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Solon, COA hit delays of LTO foreign IT contractor

The Philippine Star

MANILA, Philippines — Concerns over the rollout of the Land Transportation Office’s (LTO) information technology (IT) system were raised during the deliberation of the Department of Transportation’s (DOTr) 2022 budget last September 15 at the House of Representatives.

Bagong Henerasyon Party-list Representative Bernadette Herrera-Dy cited the findings of the Commission on Audit (COA) published earlier this year, which revealed that the P3.44-billion LTO computerization project or the Land Transportation Management System (LTMS) has been delayed for over three years.

The contract in question is divided into two components—Component A or the LTMS (P3.44 billion) and Component B (P4.78 billion)—which are composed of various projects for the procurement of hardware, software, and services related to LTO’s automation. The said project has been awarded to a Joint Venture led by a German IT firm in May 2018.

Based on the COA report, the deliverables of LTMS were supposed to be submitted to LTO in December 2018. However, the audit body noted that LTO extended and changed the deadline “in favor of the vendor without a valid and justifiable reason.” 

COA also observed that the approval of extension orders for the LTMS without proof of due diligence, and acceptance of customized core applications even with unresolved defects caused undue payments to the vendor, which is “disadvantageous to the government and delayed processing of transactions causing unnecessary burden to its clients, respectively.”

Aside from the project delays and unclear basis for numerous extensions, COA also flagged the non-utilization of already procured peripheral devices in some LTO offices, which is considered unnecessary expenditure and wastage of government funds. These peripheral devices include fingerprint scanners, signature pads and web cameras, among others.

A significant finding was the non-imposition of penalties on the contractor despite the same being provided by the procurement law of R.A. 9184. This prompted the House of Representatives’ Committee on Appropriations to ask LTO several questions during the budget hearing.

Herrera-Dy questioned the German contractor’s capability to deliver the project, which could have helped LTO in the automation of its internal and external functions. She also directed DOTr and LTO to investigate the issues on delays and allegations of inadequacy and incapacity of the contractor to comply with the agreements of the contract.

In response, LTO Assistant Secretary Edgar Galvante explained that the COA might have only cited a portion of the project that should have been completed within six months. He clarified that the project in question is in phases and that Component A is already 80% complete. Extensions were made because some LTO offices failed to respond due to the ongoing pandemic. DOTr and LTO are expected to submit the results of their investigation to the House of Representatives.

 

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BAGONG HENERASYON PARTY-LIST COA LTO
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