Sleazy procurements follow pattern/Duque explains ambulance ‘overprice’

Scandalous government procurements follow a pattern. Deals are cooked behind closed doors, not publicly bidded. Contractors are patently favored even if financially and technically unqualified. Denials of wrongdoing are profuse. The President is dragged down in stench defending his men.

PH Trams was only two months old when awarded the Metro Rail Transit-3 maintenance in 2012, exposed here in Gotcha. Its paid-up capital was only P62,500 (the minimum required for P1-million authorized). It had no experience in rails. “Emergency” negotiations were rushed. Then it was awarded P575 million over ten months – 9,200 times its worth.

The transport department transferred the contract to two other inexperienced firms. But the same ruling party financiers were behind them. Then-president Noynoy Aquino ignored the resulting deterioration of MRT-3. His administration became so reviled. The transport secretary was indicted in 2018. The MRT-3 chief was convicted in 2020.

Pharmally Inc. was only six months old when contracted for emergency pandemic supplies starting April 2020. Its paid-up capital was only P625,000 (for P10-million authorized). Financier-guarantor was presidential Chinese friend and economic adviser Michael Yang. Prices of personal protective equipment, face masks and shields were negotiated. In ten months it cornered P42 billion – 67,200 times its worth.

Starpay was faltering when tasked to disburse more than P50 billion in “ayuda” in 2020, senators allege. With only P62,500 paid-up capital, it bagged 800,000 times its worth. It was unable to pay out P8.2 billion to more than two million needy families.

President Rodrigo Duterte’s popularity is dropping deep and fast.

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Health Secretary Francisco Duque III replies to the points raised by Sen. Panfilo Lacson in Gotcha, 8 Oct. 2021, “P841-M Overpriced Ambulances, P2.7-B Expired Meds Unexplained.” Lacson had alleged P1-million overprice in each of 841 ambulances procured by the Dept. of Health. He deduced this by comparing the DOH purchase price with that of two local government units and the Philippine Charity Sweepstakes Office. The LGUs and PCSO had copied the DOH specs, including all the accessory equipment. Lacson also advised Duque to look into a possible procurement Mafia in DOH behind the P2.7 billion in expired, expiring and overstocked medicines year after year, same brands, same suppliers.

Duque says: “The DOH has always been open and transparent in all transactions, and remains committed to improving processes to better serve the people. It takes cognizance of any allegation of irregularities, and has always been open to inquiries and discussions to address such matters.

“On ‘overpriced’ ambulances, the DOH sets the record straight that the 839 units are within the approved budget, compliant with licensing standards set in DOH Administrative Order 2018-0001, and underwent competitive, fair bidding.

“In 2019 the DOH, through its 17 Centers for Health Development and 54 hospitals, procured Type 1 ambulances, fitted with 30 life support equipment for transporting patients in acute medical peril, for trained responders to apply immediate medical interventions.

“The implementing units procured the ambulances between P2.1 to P2.5 million each, all within the Approved Budget Contract of P2.5 million.

“In surveys conducted with some LGUs and PCSO, it was found that the ambulances bought at around P1.5 million per unit are only fitted with 10 to 12 basic equipment, meant only to transport patients in a non-immediate life-threatening condition.

“The DOH submitted to the Senate on Oct. 4, 2021 all pertinent documents on the ambulance procurement, such as bidding documents from the health facilities, Terms of Reference and policy references. These ambulances are distributed to the implementing units, indispensable in providing swift medical intervention and in saving lives.

“As to the Senate inquiry on the P2.7-billion expired, overstocked and near-expiry items flagged by the Commission on Audit, the DOH clarifies that these refer to the total inventories from 2013 to 2020.

“In 2020, the COA found about P95 million worth of expired, overstocked and near-expiry inventories. Delivery of medical services is untenably affected by the COVID-19 pandemic due to the enforced mobility restrictions and physical contact, and fear of people to go to health facilities. Some facilities experienced decreased admissions for other illnesses and low turnout of hospital confinement, resulting in the low utilization of inventory and inevitable overstocking of medicines.

“Nevertheless, we assure the public that corrective measures are being taken by our operating units such as transfer of slow-moving/idle stocks to facilities where most needed, and requests to suppliers for replacement of near-expiry items.

“In 2018 DOH established a Procurement and Supply Chain Management Team which steps away from the traditional vertical management approach in which each health program has a separate supply chain system, and which paved the way to the creation of the Supply Chain Management Service in 2019. The SCMS has significantly acted for the decline in the quantity of expired or near-expiry drugs, medicines and other health commodities.

“Even with our non-attendance in the hearings to give way to COVID-19 response related tasks, we continue to give our full support and cooperation to the Senate. We will submit data and documents they have requested, as we have been doing in the past weeks, to aid the investigations. We are one in their pursuit of truth and accountability.”

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