Conflict of interest? Duque insists family's firms transacted with gov't legally

Dharel Placido, ABS-CBN News

Posted at Aug 14 2019 03:42 PM | Updated as of Aug 14 2019 04:47 PM

MANILA - Health Secretary Francisco Duque III on Wednesday maintained his innocence amid allegations that he abused his power so his family’s firms could bag government contracts.

Sen. Panfilo Lacson has castigated Duque after discovering that the latter’s family-owned building in Dagupan City, Pangasinan was being leased to PhilHealth.

Lacson also accused Duque and his family of conflict of interest when their pharmaceutical firm, Doctors Pharmaceuticals Inc. (DPI), bagged government contracts.

Duque maintained he did not abuse his power as health secretary.

“Sa aking mahabang serbisyo sa gobyerno, hindi ko kailanman binahiran, at di ko kailanman babahiran ang magandang pangalang ipinamana sa akin ng aking ama, former health secretary Francisco Duque Jr.,” Duque said in a prepared speech at a Senate Blue Ribbon Committee hearing.

(In my years of government service, I did not taint nor will I ever taint the good name bequeathed by my father, former health secretary Francisco Duque Jr.)

“Ours is not a legacy of wealth but of service. My public record is an open book of which I am proud.”

Duque said PhilHealth’s lease of the Pangasinan building, owned by Lyceum-Northwestern University under corporate name Educational and Medical Development Corporation (EMDC), was not disadvantageous for the state-run health insurance agency.

He explained, PhilHealth transferred to the building in 2012 after its previous office was declared a fire hazard. He added, the rent for the building was reasonable.

“There is absolutely nothing anomalous about the lease. It went through proper procurement,” said Duque.

At the time of the start of lease period, Duque was serving as chairman of the Civil Service Commission (CSC) under the Aquino administration. As CSC chair, he was an ex-officio member of the PhilHealth board.

Duque said PhilHealth approached the Duque family so it could lease the property.

He said the lease was supposed to be terminated in 2017, way before the issue was raised and two years ahead of the end of the lease contract, as the university needed more space due its growing student population. However, PhilHealth did not leave the building “for reasons I am not aware of,” Duque said.

Duque said while asking PhilHealth to vacate the building would have been the “ideal scenario,” the agency’s regional office had nowhere to go. He added, the place was accessible to the agency’s office and its clients.

He also said he told then PhilHealth President Alexander Padilla about the lease and the latter did not find anything wrong about the transaction.

“Walang conflict of interest dahil ang negosyo ng korporasyon ng pamilya - eskuwelahan, unibersidad - walang direktamenteng regulatory authority ang PhilHealth or DOH,” he said.

(There was no conflict of interest because the business, a school, is not regulated by the PhilHealth or DOH.)


Duque also maintained there was no conflict of interest in his family’s pharmaceuticals firm DPI’s dealings with the government.

He explained that DPI, established in 1946, had been dealing with the government way before he was born.

Lacson said the DPI bagged government contracts in 2005, the year Duque was confirmed as health secretary under the Arroyo administration.

But Duque explained that the transactions were with local government units, not the health department.

He added, he divested from the company in 2005.

DPI’s chair, Duque’s brother Cesar, said the firm had no contracts with the DOH during the time Duque served as health secretary.

“It was a very specific instruction to the management of the company,” Cesar said.

Duque first served as health secretary from 2005 to 2009 under then President Gloria Macapagal-Arroyo. He reassumed his post under President Rodrigo Duterte in 2017.

He was CSC chairman from 2010 to 2015.

During the hearing, Lacson released two award notices of transactions between the DOH and DPI, with contract dates ending Nov. 30, 2017 and Dec. 31, 2017.

Cesar explained, the contracts were probably struck at the time his brother was not in government.

But Lacson said the contracts should have been canceled when Duque assumed his post as health secretary, noting that government officials should be held to a higher standard.

“We don’t need to learn rocket science to conclude, to even suspect that there’s really conflict of interest,” Lacson said.