The Commission on Audit (COA) Proper has disallowed P43.95 million in partial payments for the anomalous procurement of decorative street lighting facilities for the 2007 Asean summit in Cebu and Mandaue cities.
In a Dec. 29, 2016 decision, the COA Proper effectively reversed the June 16, 2010 ruling of the COA-Region 7 that reduced the disallowance against Mandaue and Cebu city local officials and supplier Gampik Construction and Development Inc..
COA chairman Michael Aguinaldo and Commissioners Jose Fabia and Isabel Agito said the officials and supplier should be held liable for P23.969 million, not just P13.335 million as recommended by the regional office.
Meanwhile, the Mandaue City officials and suppliers should be liable for P19.98 million, not just P11.234 million.
The COA Proper noted that the procurement was done without public bidding, because the negotiated procurement was not justified under the circumstances.
The COA said there is no legal basis for the negotiated procurement because the Asean summit was not a disaster, which was a condition for direct contracting under Section 53(b) of the Government Procurement Reform Act.
“For man-made calamities or other causes which necessitate immediate action to justify resort to negotiated procurement, it must be shown that the projects are implemented to prevent damage or loss of life to property. Calamity, on the other hand, has been defined as a disaster or misfortune,” the COA Proper said.
“The hosting of the ASEAN Summit is not a disaster. Since there is no calamity at the time the projects were implemented, there is no danger to speak of. Hence, the phrase “when time is of the essence arising from natural or man-made calamities or other causes where immediate action is necessary to prevent damage or loss of life or property or to restore vital public services, infrastructure facilities and other public utilities” does not apply to the herein procurement,” it added.