Alleged failure of the Land Transportation Office (LTO) to comply with regulations under the Government Procurement Reform Act when it started the P3.8-billion Motor Vehicle License Plates Standardization Program is the reason why many car owners are up in arms over the unavailability of license plates throughout the country.
This was contained in the eight-page Audit Observation Memorandum (AOM) issued by the Commission on Audit (COA). The memorandum, a copy of which was obtained by The Manila Times, was dated November 17, 2014.
The AOM is a written notification to the audit head and concerned officer/s informing them of deficiencies found in the audit of accounts, operations or transactions and requiring comments thereto and/or submission of documentary and other information requirements within a reasonable period, according to the COA website.
The COA memorandum said the LTO incurred a delay of 242 days in the procurement process from the opening of bids on May 6-7, 2013 to the issuance of Notice to Proceed on February 12, 2014.
The undue delay is contrary to Republic Act (RA) 9184 or the Government Procurement Reform Act.
Section 38 of the revised implementing rules and regulations of RA 9184 states that the procurement process shall not exceed three months or 90 days from the opening of bids to the awarding of the contract.
But based on the review conducted by the COA on the multibillion-peso contract, which was awarded to the joint venture of J. Knieriem BV- Goes and Power Plates Development Concept Inc. (JKG-PPI), the Department of Transportation and Communications (DOTC) took eight months to complete the procurement process.
The DOTC also failed to comply with the COA circular regarding submission of the contract and other supporting documents within five days from the execution of the contract.
COA found that such documents were submitted to DOTC auditors on March 24, 2014 and to LTO auditors on April 1, 2014.
“This resulted in the delayed implementation of the program and affected the LTO’s efficiency in the issuance of license plates to newly registered motor vehicles and motorcycles in 2014,” the AOM stated.
DOTC officials could not be reached for comment as of press time.
But Leo Romero, counsel of bidder Marianing and Sons Development, in an interview said the delay in the procurement process could have been caused by failure of the DOTC to obtain required documents to make the process legitimate.
Romero added that the Bids and Awards Committee (BAC) that handled the license plate supply contract proceeded with the bidding without the approval of the National Economic and Development Authority (NEDA) and a multi-year obligational authority (MYOA) from the Department of Budget and Management (DBM) as well as the required appropriation for the project.
The BAC was composed of Transportation Undersecretary for Legal Affairs Jose Perpetou Lotilla, as chairman; Rene Limcaoco as vice chairman; Julianito Bucayan Jr., alternate vice chairman and Ildefonso Patdu Jr. and Alfonso Tan Jr. as members.
Tan now heads LTO.
Aside from the late submission, COA also noted in its memorandum that other requisite documents, such as detailed computation of approved budget for the contract (ABC); results of eligibility check; abstract of bids; and Philippine Government Electronic Procurement System (PhilGEPS) registration certificate and tax clearance of JKG-PPI were also not submitted by the DOTC, thus hindering complete review and evaluation of the contract.
The LTO has been claiming that the backlog in the issuance of the license plates was not its fault and the agency was never late in issuing plates for newly-registered motor vehicles.
Tan blamed auto dealers for the delay because of their failure to immediately process registration of units bought from them.
Check and balance
The DOTC also failed to observe check and balance when it awarded the contract to JKG-PPI because the official who recommended the awarding of the contract to DOTC Secretary Emilio Abaya was also a signatory to the contract.