The Office of the Ombudsman has dismissed an administrative complaint filed against former Department of Health (DOH) Secretary Enrique Ona, former Assistant Secretary Nicolas Lutero 3rd and former Undersecretary Teodoro Herbosa in connection with the bidding for the modernization of the Region 1 Medical Center (R1MC) in 2012.
The Ombudsman earlier found the three guilty of grave misconduct but they filed a motion for reconsideration seeking the reversal of the resolution, which was eventually granted.
“After a considered re-evaluation of the parties’ submissions vis-a-vis the records of the case and the laws and issuances involved, this Office finds respondent-movants’ motions impressed with merit,” the Office of the Ombudsman said.
The resolution was signed by Graft Investigation and Prosecution Officer III Sergio Duke Villar and approved by Ombudsman Conchita Carpio Morales on October 27.
The complaint stemmed from the DOH’s decision to upgrade and modernize four regional hospitals, including R1MC.
Based on the Ombudsman’s earlier ruling, Joseph Rolando Mejia, who was then the Medical Center chief of R1MC, issued a Notice of Award to Northern Builders Inc. (NBI) on August 23, 2013.
Specified Contractors & Development Inc. (SCDI), one of the bidders, wrote a letter on August 28, 2013 to the Office of then President Benigno Aquino 3rd alleging that the hospital’s Special Bids and Awards Committee (SBAC) committed irregularities in the bidding of the project.
Upon receipt of a copy of the letter, Ona ordered Lutero to conduct a fact-finding probe into the alleged irregularities.
Ona also issued a cease and desist order stopping Mejia from proceeding with the bidding pending the investigation.
After alleged lapses were found in the procurement process, Ona ordered a rebidding of the project.
The DOH’s decision to have a rebidding prompted the NBI to file a complaint before the Ombudsman in December 2013.
In its earlier ruling, the Ombudsman found that the respondents had no authority to nullify the SBAC’s decision because SDCI did not file a protest. It cited Section 55 of the Government Procurement Reform Act, which provides that a protest must be filed first before the head of the procuring entity can act on matters concerning the SBAC’s decisions.
However, the recent resolution of the Office of the Ombudsman upheld Ona’s power to act on the bidding irregularities even without a protest.
The resolution stated that, as the head of the procuring entity, Ona “could disapprove the SBAC’s recommendation and had jurisdiction to exercise the reservation clause even if no protest was filed by a bidder.”
It was referring to the provision under the implementing rules and regulations of the procurement law which gave Ona, as head of the procuring entity, the right to reject bids, declare a failed bidding, or not award the deal in some situations.
“And the Notice of Award issued by Mejia could never bind Ona who was the one authorized to issue it. Ona could not be forced to enter into a contract with NBI for the R1MC modernization project on the basis of Mejia’s Notice of Award. More so in this case when Lutero’s investigation uncovered irregularities in the SBAC proceedings. Entering into a contract with NBI under the circumstances would have been the imprudent action. Moreover, Ona did not award the project to SCDI. He ordered a re-bidding for the project. Thus, he did not favor SCDI,” it said.
As to Herbosa, the Ombudsman said that the records do not show that he insisted that the SBAC continue with post-qualification procedures after Mejia said that SCDI did not qualify.
“Neither do the records show that Herbosa influenced Ona to award the project to SCDI,” it added.
The Ombudsman also found that Lutero merely conducted the probe ordered by Ona.
“The records show that SCDI’s letter to President Aquino, a copy of which was received by the Office of Secretary Ona on 30 August 2013, was referred to Lutero’s office for action on 5 September 2013 per the Document Tracking Information System. Lutero submitted to Ona his investigation report dated 31 October 2013 recommending that Ona declare a failure of bidding in accordance with the reservation clause. He thus merely conducted an investigation and submitted his report and recommendation,” it said.