Brillantes says no 'midnight deal' with Smartmatic

By RG Cruz, ABS-CBN News

Refurbishment of PCOS machines starts in March

MANILA - Commission on Elections (Comelec) Chairman Sixto Brillantes on Tuesday maintained that he and retiring commissioners Lucenito Tagle and Elias Yusoph gained nothing from the alleged "midnight deal" to give Smartmatic the contract to refurbish the Precinct Count Optical Scan (PCOS) machines for the 2016 elections.

Former elections commissioner Augusto Lagman on Monday criticized as a midnight deal the poll body's decision to accept Smartmatic's proposal to examine, diagnose and undertake minor repairs of the PCOS machines. 

Lagman pointed out that Brillantes had already mentioned earlier that he was already preparing for retirement. "Is this part of his preparation? Normally, when somebody else is going to take over you, let that person make those decisions. They had to make that midnight deal... It leaves a very bad taste in the mouth," he said.

But according to Brillantes, the contract was already meant to be given to Smartmatic about three or four months ago. He said they only had to restudy it after the law department insisted on a public bidding.

"It took us several weeks. Ultimately, we came up with resolution na pwede diretso sa Smartmatic on four grounds, meron kaming timeline. P300 million lang, hindi P1.2 or P2 billion, P300 million lang maximum tinitingnan namin. Magigipit na, matagal diagnostics, over 150 days to review the 82,000," Brillantes said.

"Very risky kung ibibigay sa iba. Ang nag-manufacture Smartmatic, sila ang makakakita kung defective, ano dapat repair. Pangatlo, under SC [Supreme Court] ruling, pinayagan na naman yan, nagkaayos Smartmatic Dominion, meron exclusive warranty extension, pwede bigay sa Smartmatic yan," he added.

The 8-month refurbishment of the PCOS machines will begin in March 2015.

Brillantes referred to the first phase of the repair as diagnostics, examination and minor repairs, costing P300 million. During phase 2, major repairs will cost P900 million. In phase 3, upgrading will cost P800 million. The last two phases will be covered by separate contracts.


In its resolution dated December 23, 2014, Comelec accepted Smartmatic's final extended warranty proposal for the repair and refurbishment of the over 80,000 PCOS machines.

The commission cited time, primarily, in dispensing with public bidding for the refurbishment.

"Time is of the essence in the preparation for the May 9, 2016 national and local elections such that the commission and the bids and awards committee are constrained by the tight time schedule if public bidding are to be conducted in the refurbishment and/or repair of the machines considering all the procurement activities lined up. Conducting a bid for the refurbishment and/or major repair of the PCOS machines would entail unnecessary delay in the preparations for the 2016 elections."

The Comelec argued that due to the complexity of the technology, a bidding would require two stages which may run up to as long as 88 calendar days, a process that may have to be repeated if there is a failure in the bidding.

"The refurbishment of the machines is already slated to start by March 2015. The steering committee in its implementation calendar requires at least 8 months for the refurbishment of existing machines and intends to start by March 2, 2015 and to end by November 30, 2015."

The Comelec's information technology department has declared that it requires 40 days to inspect and diagnose the PCOS and an additional 200 days to refurbish them.

"It is glaringly evident that the remaining period of about 60 days before the March target date is terribly insufficient for the conduct of the two-stage bidding."

It also noted that the poll body only has one bids and awards committee handling all the requirements for the 2016 national and 2015 Sangguniang Kabataan elections.

The commission also explained that it did not start the process of refurbishment sooner because they really intended to procure a new technology for the 2016 elections.

"We had in mind that we will be using an all new technology so that the refurbishment and/or repair of the existing machines are out of the question."

The plan to buy new machines hit a roadblock at the budget department, which recommended the reuse of the machines to Congress when it submitted the agency's budget. Congress only passed the 2015 budget in mid-December 2014.


Brillantes said the poll body also considered the risk of the old legal battle between Smartmatic and software owner Dominion voting systems, which, in 2013, led to a standoff over the source code.

Aside from time, old legal proprietary issues were also considered in the decision for Comelec to avail of Smartmatic's final extended warranty proposal for the existing PCOS machines now owned by the poll body.

"To give the refurbishment and/or repair of the PCOS machines to any 3rd party provider other than Smartmatic, the original manufacturer will be too great a risk considering the highly technical nature of the refurbishment and/or repair to be conducted on the machines."

The Comelec also said "there is a dangerous risk of damaging the integrity of the system as the 3rd party provider may not be able to fully refurbish and or repair the machines because the workings and technology of the machines are not familiar with them. We cannot take the very arduous repercussion of jeopardizing the 2016 national elections due to the non-assurance that if we will go to public bidding, the winning bidder can actually do the reverse engineering in the machines."

It also recalled that should there be a 3rd party, there may be a need to reverse-engineer the software which would in turn require another certification of the source code from SLI Global Solutions, which requires six months.


Brillantes hit back at Lagman and urged him to prove his allegations that the PCOS can be tampered.

"Nagsalita na naman si kaklaseng (Lagman)... Alam mo basta eleksyon nagpapapansin...," he said. "Rinig na rinig ko tapos na interview sa refurbishing, may pahabol, sabi niya, 'Alam mo yang Smartmatic na PCOS, it can be easily tampered.' Sabi ko ginamit na natin dalawang eleksyon, it can be easily tampered? Dapat matagal na ni-raise, six years ago. Bakit sinasabi ngayon?"

"Gusto ko malaman. Iimbitahin ko siya pumunta, pakita gaano kadali i-tamper. We're going to invite him formally. If it is true, show us how it is done so we can correct it. If he cannot prove it, he should stop talking. He's already 75."

Brillantes added, "Namemersonal lang yan. Pag midnight, may nangyayari sa aming magre-retire, may pakinabang kami... Magpakitaan kami lifestyle ng bawat isa, sino mas mayaman, may bagong condo, sino mayaman all the time. Ako, di umaalis, sa bahay ko since 1971."

Brillantes suspects Lagman wants to push for an open election system which allows for automated canvassing but manual counting of votes.


Lagman, in a text message, refuted Brillantes' statements.

"Who's going to do the tampering? Anyway, I don't have to watch it demonstrated. I know it can easily be done. Just rig the computer programs. Hahaha! Kung hindi mo kayang sagutin ang arguments, atakehin mo yung tao. Pera ko, pera ng mga kaibigan ko, at borrowed money ang ipinagpagawa ko ng 5-storey condo namin. Malinis na pera yan. Inumpisahan ang construction bago ako na-appoint sa Comelec. Nakasira pa nga yung pagka-appoint sa akin. Nagka-delay-delay. Ako pa? Nagsoli pa nga ako ng pera nung nasa Comelec ako eh," Lagman said.

The Comelec cited a provision in the procurement law in dispensing with the public bidding because "the goods procured are of proprietary nature which can be obtained only from the proprietary source of the PCOS licensed technologies and from the exclusive manufacturer."

It recalled the legal squabble between Smartmatic and Dominion, which has been settled, among others, with an agreement that Dominion will give Smartmatic full and unencumbered access to the licensed technology for use in the country, including the latest Philippine PCOS source code.

Comelec is also wary that Smartmatic will not take responsibility for malfunctioning machines tampered by other entities. Also, if a different provider changes even one single component in the machine, the source code of the PCOS will have to be updated which will render the certification void.

Comelec also argued that the PCOS is exclusively manufactured in the Philippines by Smartmatic which does not have subdealers and there is no direct substitute for the product.

Lastly, the extended warranty is part of the 2009 automated election system (AES) contract which was already the product of a public bidding.

The proposal includes the warranties already provided under parts of the AES contract as well as a commitment that the price for the parts, labor and technical support and maintenance is fixed at the prevailing market prices and for the periods stated in the extended warranty proposal.

Smartmatic's proposal also said that "since the program did not take place earlier this year (2014) the 5-month program of work covered by this proposal will run into the start of 2015. Each of the PCOS machines will go through the program."

Smartmatic commits that during the 2014 extension to the warranty, it will:

examine every PCOS for the refurbishment required to bring them back to the working order after an extended period in storage and with no preventive maintenance;

complete a full diagnostic on all the machines;

perform a full preventive maintenance program;

for minor repairs those not needing parts, complete repair on the machines on all the PCOS;

subject to the exclusions in the exclusions section below, where parts lead-time allows and up to a maximum of 4% of the units, we will also repair any of the PCOS that require major repair subject to the exclusions below.

The law department of the Comelec had reviewed the contract for the extended warranty proposal and is of the opinion that "nothing is wrong in resorting to direct contracting or single source procurement under certain conditions."


Commissioner Luie Tito Guia, one of the two commissioners who dissented, justified his dissent.

"It was basically pagkakaiba ng judgment as to how things should be. Valid din naman judgment ng majority, timeline is very important. Elections is operations issue. We want to have comfortable time to prepare. Ako naman, what I saw, it's also important to look at the process. Process is as important as result. In the end, what we're after is credibility of the election, acceptability of election results," Guia said.

"No matter how perfect or accurate the process is, when people don't believe it is so, you'll create doubt. It's a judgment call on my part to say mas maganda siguro pag una that's our machine, our internal personnel should do repair. Kung di pwede, competitive bidding is better option."

Brillantes, Tagle and Yusoph will retire on February 2. Brillantes said he has no idea who will replace him, but he did give an idea of his preference.

"Gusto ko sana babae, matapang, bata. (Leila De Lima?) Hindi. Si Kim Henares yun. Ayaw ko na nga babanggitin babae, bata, matapang. Sana. Wala ako naririnig, mahina na pandinig ko, 75 years old na ako eh," he said.