After flyover bridge issue, now comes the rice!

AFTER THE controversial flyover issue, now the rice purchase made by the local government for Zamboangueños at the height of the Covid-19 pandemic in 2020, is again being revived as a black propaganda ahead of the May polls.

With the elections nearing, political foes of Mayor Beng Climaco have revived the issue of the proposed flyover project with politicians running for the polls, again riding on the topic and taking advantage of the propaganda.

But the overpass project of the Department of Public Works and Highways had been halted since 2019 after DPWH failed to comply with the local government requirements and its funds returned to the national government.  

Now, Climaco’s enemies are spreading black propaganda anew and this time the so-called overpriced purchases of welfare goods despite repeated denials by the local government. 

Climaco, who is now on her third and last term, said with respect to the issues and allegations on overpricing and alleged corruption and the Audit Observation Memorandum and Notice of Disallowance from the Commission on Audit on some transactions of the previous years, this does not automatically equate to conclusive evidence of the liability of all concerned.  

“Our respective replies were already submitted to the concerned agency, who we consider as our enabling partner for good governance and in the achievement of the City’s goals and objectives. Hence, let due process of law take its course, rather than spread sheer speculation to perceive and ascribe corrupt intent and conspiracy of wrongdoing of the personnel involved,” Climaco said. 

“In fact, there are no fixed rules as to what constitutes an unlawful expenditure. In post audit exercises, apparent excess payments or overpricing initially shown by the discrepancy between the actual agency expenditure and the estimates of the Commission on Audit is not a conclusive determination of unlawful expenditure,” she explained. 

The mayor said the characterization of the expenditure would be determined by the “circumstances of time and place, behavioral and ecological factors, as well as political, social and economic conditions.”  

In other words, she said, the expenditure would be judged on varied factors to include its legality, regularity, necessity, reasonableness, and moderation. “Este el verdad y claro que el gobierno local nohay viola ley na este maga proceso,” Climaco said. 

Procurement law followed 

In June 2020, the Bids and Awards Committee or BAC flatly rejected allegations of overpricing in the purchase of some 250,000 bags of rice intended for each household in all 98 villages here affected by the pandemic.  

Erwin Bernardo, the BAC chairman, said the acquisition of rice went through negotiated procurement under emergency cases, particularly in the instance, “when time is of the essence arising from natural or man-made calamities.” 

The BAC approved the purchase of rice at P1,300 per 25 kilo-bag after the supplier, 5MJ Marketing, submitted all legal documents required by laws. 

Bernardo explained that in order to determine whether the supplier is technically, legally and financially capable to address the emergency, BAC required 5MJ Marketing to submit the following documents – the PhilGeps (Philippine Government Electronic Procurement System) Platinum Certificate, Omnibus Sworn Statement, Latest Income Tax Returns and Business Permit. 

He said aside from the submission of the documents, it is very important that the supplier has an excellent track record with the procuring entity.  “It is equally important to use the contents of the PhilGEPS electronic registry of suppliers to determine the eligibility of a supplier relative to its past transactions with other entities of the government,” he told The Zamboanga Post newspaper, adding, “the procurement of rice was done within the bounds of the procurement law and the price is reasonable based on the prevailing market price.” 

Bernardo said the procurement of rice went through the process and it was done within the bounds of the procurement law and the price is reasonable based on the prevailing market price. 

“It cannot be denied that we are in a state of worldwide calamity. Hence, this alternative mode of procurement was resorted to instead of the usual competitive bidding because it relates to time element as the primordial reason,” he said.  

Bernardo further explained that the procedure is, upon receipt of the purchase request together with supporting documents to include the approved budget for the contract from the end-user which is the City Social Welfare and Development Officer, the BAC may directly negotiate with a supplier with technical, legal and financial capability to deliver the goods. And upon confirmation and ascertainment of such capability to address the emergency, the head of the procuring entity, upon recommendation of the BAC, shall immediately award the contract to the supplier. 

He said while rice is sold by retailers and traders at lower price, the Procurement Law (RA 9184) mandates that local government units only transact with “technically, legally and financially” eligible suppliers, that is, compliant with requirements set by law.  

“Inasmuch as we want to buy directly from traders and retailers, requirements of the law (RA 9184) preclude us from doing so. The amount of P1,300 per sack was indicated in the purchase request and the approved budget for the contract before it reached the BAC. And upon receipt of the purchase request, the BAC made its own calculation based on the prevailing market price.  During the market survey, the price ranged from P1,120 to as high as P1,250.” 

“Allowing the 10% mark-up under COA rules, the allowable price per sack would be around P1,232 to P1,375.  The 10% mark-up is intended for handling costs, labor costs, other overhead expenses incurred by the supplier and his allowable profits,” Bernardo said. 

He said the BAC cannot settle with the lowest amount only because, considering the instability of supply and abnormal demand in the market, the supply for the lowest priced premium rice may not suffice the demand of the City Government which is 250,000 sacks.  Hence, the ceiling price was pegged at P1,300 so that the supplier can still go for other rice brands of higher price without going beyond the ceiling price. 

Bernardo clarified that the price of rice is variable and can easily change depending largely on the law of supply and demand amid the pandemic. 

“We are in a state of extraordinary times and not normal times where time is of the essence in the procurement process.  The City Government cannot purchase it directly from the retailers or wholesalers, as some would tend to believe, because of the volume of the transaction nor can it split the contract since it is prohibited by law.  It needs the services of the supplier who will buy it from retailers and traders and deliver it and collect (it) later from the (local) government,” he said. 

He also cited that COA allows 10% mark-up on normal or ordinary times and considering the different factors affecting price and supply in the market such as higher labor cost due to scarcity of laborers, doubling of cost of transportation of goods, disruption of normal supply in the market since even ordinary buyers hoarded for their own supply, “the City Government complied with the 10% allowable mark-up during this pandemic to religiously comply with laws and rules. Had the City Government not provided the allowable higher maximum price per sack, we will not be able to procure the needed 250,000 sacks and be able to distribute the same to the people of Zamboanga City, because the supply for the lowest price is not sufficient.” 

Bernardo said the few reported cases of spoiled rice were immediately replaced by the supplier. “As admitted by the supplier, rice spoilage may not be easily detected in big volumes of rice.  The immediate replacement of spoiled or low quality rice signifies the City Government's commitment in assuring that the supplier fully complies with its obligations,” he said. 

Climaco’s foe have used the rice issue in attacking her despite the transparency and strict processes imposed by the local government in the procurement of welfare goods and other necessities in the middle of the health crisis. 

The mayor shrugged off all black propaganda and fake news and false information against the local government and urged her political enemies to move on if they cannot help in unified efforts to fight the pandemic, heal the sick and feed the hungry. (Zamboanga Post)