DPWH told to recover P431M from contractors of overpriced projects

Adrian Ayalin, ABS-CBN News

Posted at Oct 19 2020 05:39 PM

President Rodrigo Duterte greets Public Works Secretary Mark Villar prior to the start of the 46th Cabinet Meeting at the Malacañang Palace on March 2, 2020. Simeon Celi, Presidential Photo/File

MANILA — The Commission on Audit (COA) has told the Department of Public Works and Highways (DPWH) to recover a total of P431.933 million from contractors of projects which exceeded allowable costs. 

In the 2019 audit on the DPWH made public by COA recently, state auditors said that 184 projects nationwide were found "excessive" by COA's technical audit specialists using the Approved Budget for the Contract, or ABCs, as reference values.

Various deficiencies ranging from excessive costing and overestimated quantities of items were found in the construction of roads, bridges, school buildings, flood control projects, and multi-purpose buildings.

"This deficiency between the contract cost and COA estimate cost should have been corrected and rectified during the bid evaluation conducted by the Bids and Awards Committee-Technical Working Group on the bid price of the contractors prior to declaration of the Lowest Calculated Bid," the audit team said.

The auditors recommended that deductions from contractors can be done from their succeeding claims or from retention money or other securities posted by the contractors.

The audit report noted various comments from DPWH regional offices justifying the overpricing of contracts, such as smaller quantities of work items turning out to be insufficient, further requiring larger quantities.

Delays in the implementation of projects were also cited such as inconveniences of residents during construction,. as well as unavailability of such items as steel sheets during the implementation of the project.

Other engineering districts, however, agreed with the COA recommendation.

"We agree with the recommendation and will see to it that it will be implemented as soon as possible," the DPWH Agusan del Norte management told the audit team.

Auditors also noted a total of P101.69 billion worth of problematic projects, including P3.206 billion worth of projects which have not yet started.

The total amount also includes P65.989 billion projects not completed within the specific contract time, suspended projects worth P31.051 billion, and terminated projects totaling P1.444 billion.

Auditors noted that the DPWH management and its consultants failed to consider factors such as typhoons, peace and order situations, road right-of-way, local government permits and others.

The DPWH, however, reasoned out that the release of capital outlay allotments for certain projects were delayed, among others.

"Efforts such as planning, coordination, periodic inspection and close coordination are being made. Further management will send letters to contractors with negative slippage to accelerate implementation," the DPWH told the audit team.

The report noted as well that technical defects were found in 461 projects worth P376.138 million. 

The DPWH told the audit team that the defects have already been coordinated with contractors.

"Several rectifications have already been made and liquidated damages imposed/collected," the DPWH management told the audit team.

A copy of the audit report was received by the office of DPWH Secretary Mark Villar on September 30, 2020.

President Rodrigo Duterte last week said he still has "full trust and confidence" in Villar despite alleged corruption in his agency.

Duterte, in a late night speech last Wednesday, said a portion of the DPWH funds are being used to "give" to certain people, whom he did not identify.

A day after, Sen. Panfilo Lacson claimed that lawmakers and DPWH officials asking for "kickbacks" from contractors that won projects from the agency have become an "open secret."

Contractors have been "openly" talking behind the back of department officials and lawmakers who have been asking for commissions, Lacson said in a statement.

"Officials from the executive and legislative branches who ask for 'only' 10 percent are 'mabait, maginoong kausap,' (kind, gentlemanly), and those who demand 20 to 30 percent are 'matakaw' (greedy). Those who demand advance payments and renege on their word (are) 'balasubas' (swindler) and 'mandurugas' (cheater)," he said.