PH lost P1 billion due to overpriced PPEs procured by budget department: Hontiveros

Gillan Ropero, ABS-CBN News

Posted at Sep 17 2020 12:15 PM | Updated as of Sep 17 2020 03:16 PM

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MANILA (UPDATE) — The Philippines lost some P1 billion in funds to overpriced protective equipment that the budget department procured from April to May in response to the COVID-19 pandemic, a senator said Thursday.

Three million out of 5 million sets of personal protective equipment that the DBM bought were from Chinese companies, said Sen. Risa Hontiveros.

The PPE sets are overpriced by P200 to P500 each when compared with the Philippine General Hospital's estimated price of P1,200 to P1,500, Hontiveros said.

"Overpriced na nga, di pa pinapagawa sa Pilipinas. Sayang na sa pera, mukhang may kinita pa," she told ABS-CBN's Teleradyo.

(These are overpriced and not made in the Philippines. It seems somebody even made money from this procurement.)

"P1 bilyon na dapat sana ay pupunta sa mas maraming PPEs. Lalo na sa panahong ito na dumadami ang bilang ng ating health workers na namamatay dahil sa inadequate protection," she added, citing the World Health Organization's data stating that the Philippines has the highest rate of infection among health workers in the Western Pacific region.

(P1 billion that could have been used to buy more PPEs, especially at a time when many of our health workers die due to inadequate protection.)

The P1 billion lost to overpriced PPEs could have been used to increase the salary of health workers, Hontiveros said.

"Imbis na pag-ban sa mga nars ang atupagin, hindi ba dapat inasikaso na lang ang pagtaas ng pasahod ng ating frontliners?" she said, referring to the deployment ban on health workers to ensure an adequate medical workforce in the country while the pandemic persists. 

(Instead of banning nurses from going abroad, should we not use this to increase the salary of our frontliners?)

The Department of Health had also faced criticism over its overpriced procurement of PPEs.


The DBM, in a statement Wednesday, said it "encountered challenges in getting more qualified local suppliers capable of meeting the requirements of the DOH due to business disruption caused by the community quarantine and high global demand [for] medical supplies and equipment."

Budget Undersecretary Lloyd Lao, who heads the agency's procurement service or PS-DBM, "directly negotiated with medical equipment manufacturers in China" to address the problem and to "further lower procurement cost," the agency said.

“The PS-DBM reiterates its commitment to be of service to the Filipino people by providing smart procurement solutions especially during this pandemic,” it said.

In a statement later Thursday, Lao said 7 contracts for PPE sets were awarded to China-based firms from April to May because "no local supplier" could comply with the DOH's required 8-piece PPE set budgeted at P2,000 each.

The sole local company that offered a contract was declared non-compliant due to a higher price at P2,873 and its on-hand stocks were inadequate, according to Lao.

Price offers received from China-based suppliers averaged at P1,773.51, he added.

"It is for this reason that the PS-DBM deemed it only proper and beneficial for the Philippine government to award the urgently-needed PPEs to foreign suppliers," Lao said.

The PS-DBM has asked Hontiveros' office to provide documents and the names of local suppliers that could have offered lower prices from April to May but it has yet to reply, he added.

Local manufacturers at the start of the pandemic retrofitted their business to produce PPEs and other medical equipment, Hontiveros said.

"Nag-invest sila, gumastos para magkaroon ng kapasidad particular sa PPE manufacturing tapos bigla na lang silang natengga, hindi prinocure 'yung de kalidad na produce nila," she said.

(They invested their money to have the capacity to manufacture PPEs and then government did not even buy their quality products.)

The senator said she has filed a bill that seeks to mandate government to buy supplies from local producers in the event of a pandemic.

"Sa panahon na naghihingalo ang mga negosyanteng Pilipino ang laking insulto naman na dayuhang kompanya pa ang nabigyan ng kabuhayan kaysa sa kanila," she said.

(At a time when Filipino businessmen are facing difficulties, it's an insult to support the livelihood of foreign companies.)


Sen. Drilon earlier said the country had lost P422 million in potential savings due to the DBM's purchase of supposedly overpriced test kits.

The purchase involved 3 “negotiated contracts,” and the procurement did not go through open bidding, he said.

The PS-DBM said it sought help from Chinese Ambassador to the Philippines Huang Xilian in procuring Sansure test kits from Beijing at P918 each, cheaper by 45.9 percent than its first procurement of P1,464.88 per test last April 20.

"In total, DOH saved around P1.2 billion for the procurement of test kits, extraction machines, and other consumables, and another P800 million from the purchase of personal protective equipment sets," it said.

Under the agency's rules, it said the procurement process begins when the PS-DBM receives an agency procurement request from state departments.

The PS-DBM then holds its "own market scanning wherein interested suppliers submit their price offer relative to the item to be procured."