COA questions failure of bidding
THE Commission on Audit (COA) questioned Mayor Michael Rama’s move in declaring the first bidding of the Cebu City Medical Center (CCMC) project a failure last December, saying he did not cite specific reasons.
“It was vaguely explained without giving specific mention of situations that would lead to the issuance thereof in accordance with the aforestated provisions of law, thus the propriety of such declaration could not be determined,” COA stated in its annual report.
The CCMC failure of bidding was one of 12 deficiencies noted by auditors in its review of 2013 operations of Cebu City.
Auditors also questioned the use of P300 million set aside for the construction of a new CCMC.
Around P203.7 million was used instead in the distribution of cash assistance to senior citizens, persons with disabilities, barangay officials and other local government workers.
Aside from the fund use, auditors questioned the demolition of the old CCMC building by contractor JLC Corporation for lack of proper documentation on the disposal of the scrap materials from the demolished building.
Sought for comment, Mayor Rama said the city administrator will handle the matter because it is still an audit finding.
“They will soon hear our side on the matter,” Rama said.
In December, the City Council found out that the P300-million fund for the new CCMC which was placed in a time deposit account, had been used to fund the distribution of cash assistance.
City Treasurer Diwa Cuevas explained at the time that under the “one-fund” concept, funds under the General Fund are not labeled and can be used as long as it will be replenished by the first month of the next year.
Under RA 9184 or the Government Procurement Reform Act, the Head of the Procuring entity can declare a failure of bidding under three situations.
First is evidence of collusion with public officials, the Bids and Awards Committee (BAC) and any of the bidders.
The second situation is if the BAC is found to have failed in following the prescribed bidding procedures.
Third is a situation where the awarding the project would not benefit the government.
In his memorandum order to the BAC in December of last year, Mayor Rama declared a failure of bidding.
He said this was done “in order to address the issues raised pertaining to the initial bidding for the construction of Phase I of the new Cebu City Medical Center (CCMC) and to avoid or preclude any suspicion of favoritism and anomalies.”
State auditors said the order didn’t state any of the three specific grounds under the law to justify a declaration of a failure of bidding.
COA also pointed out that the bidding process was almost completed when the mayor declared it a failure.
“This could be prejudicial to the immediate implementation of the project and sacrifice the delivery of quality health care services, and put the time, effort and resources spent thereon to waste, aside from spending for additional cost of advertisement once a re-bidding is undertaken, unless the certainty of the grounds used as basis thereof in accordance with the foregoing provisions of RA 9184 is properly established,” COA said.
The joint venture of AM Oreta & Company Inc and WTG Construction, which was declared as the lowest bidder for the prior bidding, was disqualified by the BAC for misrepresentation and falsification of documents when they submitted their supposed proof of their ability to construct a similar hospital project in the last five years.
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