If newly installed Department of National Defense (DND) Secretary Delfin Lorenzana wants to start with a clean slate at the scandal-ridden agency, he should immediately review all biddings conducted by his predecessor, and if warranted, revoke all pending deals tainted with irregularities or allegations of corruption.
We recall that Lorenzana, a former special presidential representative for veterans affairs at the Philippine embassy in Washington, DC, was offered the DND post by then presidential candidate Rodrigo Duterte. Lorenzana narrated that during his “job interview,” Duterte told him he was needed in the anti-corruption drive to clean up government agencies.
“The President mentioned to me at least six graft-ridden government agencies where he needed help. He asked us to submit our résumé and trust him to place us where we were needed. I did, and a week later, I went back to Washington,” Lorenzana said. With his appointment to the DND, it is clear Lorenzana has his work cut out for him.
For decades, corruption scandals have hounded the Armed Forces of the Philippines (AFP) and the DND, with a former military general being convicted and imprisoned for graft after amassing millions of pesos during his tenure as AFP comptroller.
When DND took over (or more accurately, “centralized”) the multibillion peso procurement of military hardware from the AFP during the early months of the Aquino administration, things only got worse.
There was the P3.2-billion deal to buy some 1,200 military trucks costing P2.7-million each from Kia Motors of South Korea allegedly for operations and disaster response. Aside from the very expensive spare parts and consumables like tires (which cost P32,000 each to replace), the Korean-made KM450 vehicle were prone to breakdown and could accommodate only half the people that would normally fit in the AFP’s World War II vintage M35 military trucks.
The DND also bought the ambulance version of the same KM450 truck at P5 million each, just P500,000 cheaper than the US-made and more reliable Hummer military trucks. Why DND officials chose to buy Korean-made vehicles that are more costly to maintain, of lower quality, and only 10 percent cheaper than their battle-tested American counterpart, certainly smells fishy.
Another controversial DND procurement deal is the P1.2-billion contract to buy 21 refurbished Huey helicopters, which whistleblower Rhodora Alvarez claimed was “tailor-fitted” to favor a certain supplier – Rice Aircraft Services Inc. (RASI). Apparently, RASI joined 3 prior biddings but failed to pass the basic requirements. It only managed to get the contract after the DND opted for a “negotiated bidding.”
Alvarez also claimed former Defense Secretary Voltaire Gazmin was promised a 7 percent kickback (about P84 million) while a further 5 percent would be divided among Defense Undersecretary Fernando Manalo and other defense officials.
A Senate investigation later revealed that RASI was only able to only deliver 7 of the 21 choppers, four of which showed engine defects, with the engine of one of the Hueys needing to be changed entirely while two others had engine leaks and one other chopper refusing to start.
There are still several unfinished deals inherited by the Duterte administration.
One project that Lorenzana should look deeper into is that of the Marine Forces Imagery and Targeting Support Systems (MITSS) worth P685-million. This project involves the purchase of six small, unmanned aerial vehicles (UAVs) – commonly known as “drones” – for the Marine Corps.
We got hold of the Bid Notice for the project published on the Philippine Government Electronic Procurement System (Philgeps) website on July 29 of this year (Friday), announcing the conduct of a pre-bid conference on the next working day, August 1 (Monday).
What we found quite unusual was the notation in the Bid Notice appearing under the heading “Other Information,” which said that, “the bidding process for this project is already finished.” This probably explains why a media colleague who went to the pre-bid conference last Monday found the venue (i.e. the DND-BAC conference room) closed and doors locked.
But if bidding of the project has really been completed, isn’t it highly irregular that the pre-bid notices required under the Government Procurement Reform Law (RA 9148) are only being done now, more than two years after the scheduled bid opening on January 6, 2014? And if the bidding process is, indeed, finished, then obviously the pre-bid conference to be conducted by the DND is just “moro-moro” – a blatant violation of procurement rules. Paging Ombudsman Conchita Carpio-Morales!!
DND insiders told us that a certain Triton Communications, a local company selling radio communications equipment and systems, was given the drone supply project for its bid of P620 million. How a mere dealer in communications equipment can get the contract to supply high-tech UAVs that cost P110 million more expensive than the drone of a better-known international UAV manufacturer, which already supplies a number of military forces around the world, is a big mystery. Well, maybe not, given the country’s notoriously crooked procurement system.
We’re told there were objections to giving the contract to Triton Communications, not only because it wasn’t a drone manufacturer but also because the UAVs it offered were allegedly not being “used by the Armed Forces of the country of origin or by the Armed Forces of at least two (2) other countries,” as required by the bidding rules, but the dissenting voices were eventually silenced by former high-ranking DND officials.
With Duterte’s marching order to his Cabinet members to stop corruption, Lorenzana faces the herculean task of bringing “change” to the DND. Whether he can truly reform the tainted procurement process and dismantle the seemingly entrenched syndicate in the agency during his tenure remains to be seen.