Sacked Navy chief denies 'insubordination'; DND says Mercado usurped authority

Patrick Quintos, ABS-CBN News

Posted at Feb 19 2018 10:59 AM | Updated as of Feb 19 2018 01:16 PM

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MANILA (UPDATE) - The former chief of the Philippine Navy on Monday strongly denied disobeying his superiors on the military's purchase of two new Navy ships under the Armed Forces modernization program.

Speaking at a Senate inquiry into the P15.7-billion frigate deal, former Flag Officer in Command Vice Admiral Ronald Joseph Mercado said his relief came as a surprise as he has a clear track record.

"I have never disobeyed any lawful order of my superior. I take pride in, and treasure, my profession the way I do to my name, my family, honor and reputation," said Mercado, who was sacked less than 3 months before his mandatory retirement.

"In my entire service to the Armed Forces, the Philippine Navy in particular, I have never been accused nor convicted of any malfeasance, misfeasance or non-feasance in the performance of my functions," he added.

Mercado also denied allegations that he was insisting that the combat management system for the warships should be provided by Dutch firm Thales Tacticos, over South Korean firm Hanwha Sytems.

"It was HHI (Hyundai Heavy Industries), the winning supplier of the frigate project that offered Thales Tacticos during the bidding process," said the former Navy chief, who also denied Special Presidential Assistant Bong Go's alleged intervention in the project.

Rappler and Philippine Daily Inquirer had reported that Go supposedly gave Defense Secretary Delfin Lorenzana in January 2017 a white paper endorsing Hanwha to provide the the CMS, and criticizing the Navy’s preference to Thales Tacticos.

Lorenzana: Sacked Navy chief 'usurped' my authority

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Mercado was relieved from his post on December 2017 following these allegations. Lorenzana admitted in the Senate hearing that Mercado was "unceremoniously" sacked but stressed that this is because the official defied his memos.

He claimed that Mercado even threatened to cancel the contract if Thales Tacticos would not be chosen as the provider for the combat management system of the warships, even though Hanwha was already found to be compliant with contract requirements.

"Admiral Mercado in one of the senior leaders' discussions -- I wasn't there but there was a minutes given to me. Ang sabi niya, he was insisting on Tacticos, and said that he will work on the cancellation of the contract kung di matuloy ang Tacticos," he said.

The frigate acquisition project was initiated by the administration of former President Benigno Aquino III. The Duterte administration signed the notice of award to winning bidder, South Korean firm Hyundai Heavy Industries, in August 2016.

Lorenzana said Mercado also prevented a meeting with Hyundai, which effectively delayed the project, prompting him to tell to President Duterte that the Navy chief was "blocking the project left and right."

Mercado, for his part, said the issue was more than the combat management system. He said Hyundai failed to submit some of the deliverables required in the contract, something he tried to communicate with the Defense Department.

"Those violations were raised to me by the project management. I can't force them to sign something violating a contract provision. Kawawa naman sila if during the audit, when they subject the transaction to the provisions, they will be held liable," he said.