Duterte should make an example of ERC in anti-graft drive

Atty. Dodo Dulay

Atty. Dodo Dulay

WHAT drives a man to take his own life? In the case of Energy Regulatory Commission (ERC) Director Francisco “Jun” Villa Jr., it was, in his own words, the unbearable pressure to approve contracts without proper bidding and procedure. The alleged culprit? None other than his boss, ERC chairman and chief executive officer Jose Vicente B. Salazar, a former justice department undersecretary appointed during the “DaangMatuwid” administration of former President Benigno Aquino 3rd.

In one of a series of suicide notes, Villa expressed a deep anxiety over reviewing procurement contracts at the electric power industry regulator: “My greatest fear in the bids and awards committee is the AVP by Luis Morelos which the chairman and CEO, Jose Vicente B. Salazar, chose through a rigged selection system. That will be a criminal act.”

“I have fears about my BAC (bids and awards committee) work…Our mistakes may bring on [Commission on Audit] observations and disallowances. Those may affect me financially,” Villa wrote.

The pressure brought to bear on the late ERC director was corroborated by his sister, veteran journalist Rosario “Charie” Villa who recalled that in the last conversation she had with her brother he revealed that he was being forced to sign rigged contracts which made him miserable.

“It was the morning of Wednesday, the following day when he told me he was being forced to sign some contracts that were not properly bidded [sic]out. Then I heard a bang,” Charie Villa said.

That Jun Villa’s cooperation and consent, as BAC chairman, was indispensable to the approval and awarding of bids at the regulatory agency is not disputed. Even Salazar admitted in a TV interview aired shortly after reports of Villa’s death hit the news, that he trusted Villa so much that he would not sign any paper if it did not bear the latter’s signature.

Is Villa’s crucial signature the reason why his arm was being twisted to favor certain parties?

Regrettably, there are those who cruelly insinuate that the manner of Jun Villa’s death somehow affects his credibility. To our mind, however, the way he died did not diminish but in fact, even bolstered the truth of his words. Jun Villa had no motive to make up a story. As an ancient poem once said, “Truth sits upon the lips of dying men.” And in Villa’s case, he paid the ultimate price for his convictions–his own life.

Villa’s death brings to light the susceptibility of the government’s procurement process to graft and corruption. How it has become so easy for crooked officials to rig the bidding process, from deals as small as office supplies and furniture costing a few thousand to big-ticket items like military hardware and road projects worth billions of pesos.

A former budget official has estimated that the government loses some P47billion every year to corruption in the procurement process. And this is a conservative estimate. A German think tank, the Bertelsmann Foundation, says more than 30 percent of the budget allocated to government projects is lost due to corruption. If we were to base it on the government’s infrastructure spending of P436 billion for CY2015 alone, that would amount to a staggering P130billion lost to corruption.

The passage of the Government Procurement Act (Republic Act 9184)–hailed by the World Bank as “world-class” when it was enacted more than 12 years ago–did not put an end to collusion in public bidding, bid-rigging, bid-fixing, and other anomalies associated with bidding for government contracts for goods, services and consultancies.

Although aimed at bringing about transparency by requiring all public biddings to go through the Philippine Government Electronic Procurement System (PhilGEPS) website–the online portal that serves as the primary source of information on government procurement–the procurement law suffers from many loopholes.

The Sunlight Foundation, an American transparency NGO, has said: “Despite the introduction of PhilGEPS and the mandate that all public procurement pass through the electronic bulletin system…compliance with reporting requirements is lacking, the information tracked by government entities is incomplete, and the data that is nominally available is subject to a range of barriers to public use.”

“…PhilGEPS does not capture all of the relevant information necessary for third-party oversight, in particular lacking details of the contract management phase, in which there are opportunities for contracts to be manipulated. Furthermore, full access to PhilGEPS is restricted to accredited contractors who have paid a registration fee. It does not provide a way to access bulk data to use for statistical or visual analysis. Instead, to access procurement information one must already know where to look, and must look one tender at a time,” Sunlight added.

The death of Jun Villa also highlights the need for a strong whistleblower law that would protect government employees who report or expose misconduct committed in their agency or by their superiors. Vowing to fight corruption, President Rodrigo Duterte urged Congress during his first SONA to pass a whistleblower law to “eradicate the prevalent cultures of fear and silence that have hounded our justice system.” We hope the PDP-Laban-dominated Congress can pass this important legislation during the Duterte administration.

In the meantime, Duterte can use his executive powers to push for more transparency in government by issuing an executive order directing all government agencies to publish all procurement contracts in the PhilGEPS website. This will complement the landmark Freedom of Information (FOI) executive order that Duterte issued less than a month after taking office.

As for Salazar, he should step down from the ERC notwithstanding his fixed term–if he has any delicadeza. That, or take a leave of absence while the Ombudsman or other independent investigative bodies are conducting their probe in order to remove any suspicion that he will use his office to intimidate or influence witnesses, or tamper with records that might be vital to the prosecution of the case against him.

More on the ERC in future columns.


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  1. If it is really true that ERC officials are corrupt as claimed by President Duterte, then the president should investigate and jail these officials rather than having a big mouth.

  2. Short of physically dragging Salazar and those 3 also-crooked commissioners out of their offices, we should not expect these criminals to give up their lofty positions easily.

  3. I think this is the same agency were Zenaida Ducut is the chairwoman, who is now a millionaire. Maybe because of her fat salary and bonuses. The same with some current official now. You can check their bank accounts now and you will discover unusual movement. By the way how much is the salary of a director.

  4. Jaime Dela Cruz on

    “…or take a leave of absence while the Ombudsman or other independent investigative bodies are conducting their probe in order to remove any suspicion …” I doubt that Conchita will lift a finger to investigate Salazar. Much like in DeLima”s case, Morales will simply say, “there is not need for an investigation, they are just allegations with no evidence.”

  5. Does everybody know where RA 9184 (the Procurement Law) was “conceived and born” ? It is the historically corrupt agency DPWH. Were the said loopholes mentioned in this article placed there by this agency ? Mastery of these loopholes were achieved by many corrupt agencies over the years. Look at government IT projects for example. Can anybody name one single successful government IT project ? Let’s for example list down big-ticket ones: LTO, LRA, NSO, DFA (passport), Comelec vote count and canvassing and voters registration automation aka PCOS, DPWH, Philhealth, etc. Is there even one exemplary implementation of the IT projects in these sample agencies ? Even today this law is being force-fitted for applications very much alien to typical DPWH projects that is why IT projects tend to be failures from inception, bidding and roll out. This law should have been amended more than a decade ago esp when the BOT projects started out.