Will DPWH finally crack down on ‘collusion,’ rigged bidding?

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Department of Public Works and Highways (DPWH) officials know that the taxpayers are becoming increasingly aware of how transactions are carried out and “how deals are closed” at the agency long-gripped by corruption but which President Aquino has praised to high heavens for being the cleanest and most efficient.

In view of the enactment of the 2015 National Budget and the availability of “pork barrel funds” at the disposal of implementing agencies in a pre-election year, the public cannot help being apprehensive about the activities of syndicates, such as those in the DPWH who are now targeting its infrastructure projects.

DPWH gets a whopping P303.2 billion, which represents 33.2 percent of next year’s total national budget, and which is up by 38 percent from the previous year.

Small contractors, who are also legitimate stakeholders, have a reason to be apprehensive because these underdogs always lose in DPWH bidding for projects that end up being awarded to suspect bigtime contractors.


Instead of being banned, these said-to-be erring contractors are able to corner major DPWH and other government projects owing to “right connections” inside the DPWH and having the “most influential backers” such as powerful politicians.

Contrary to denials of the Aquino administration, legislators will still “identify” or sponsor their respective pet projects.

These erring contractors do know how to coax the DPWH Bids and Awards Committee to favor them.

They are some of the “old hands” in this line of dirty business.

Alleged examples of such contractors, according to the small players, are the PhilWorks Construction Supply, owned and operated by one Grace Deleon, and the NFH Construction, owned by a certain Nathaniel Uy.

Despite these contractors’ pending case for alleged violations of Republic Act 9184, the government procurement reform law, PhilWorks and NFH have allegedly taken turns winning juicy contracts from Camarines Sur to Bataan in Region 3 suspiciously through “collusion” between these two contractors and officials of DPWH.

In reaction to nagging questions, DPWH Secretary Rogelio Singson is now seriously looking into the performance records of these two companies.

Singson also disclosed that he is considering suspending or banning these Camarines Sur-based firms.

Upon Singson’s report or recommendation, PhilWorks and NFH may lose membership or accreditation from the Philippine Contractors Accreditation Board (PCAB).

PhilWorks and NFH have allegedly failed to comply with the provisions of Republic Act 9184 or the Government Procurement Reform Act of 2003.

He also warned that DPWH officials who have failed to comply with the said provisions will be likewise sanctioned in accordance to Civil Service rules and regulations.

“Collusion” or “collusive bidding” refers to agreements by contractors or suppliers to cooperate to defeat or rig the competitive bidding process in order to inflate prices to artificially high levels.

Collusion in government projects often involves corruption, in which government officials and procurement personnel sponsor or facilitate the collusion in exchange for money.

All or part of the kickback ends up in the coffers of officials or political parties which used them to raise campaign expenses.

Common methods of collusive bidding, which PhilWorks and NFH have allegedly used include the following:

–Complementary bidding where cooperating bidders agree to submit higher priced or deliberately defective bids to ensure the selection of the designated winner at inflated prices. In exchange, the winner might pay a percentage of its profits to the losing bidders, hire them as subcontractors, or allow them to win other high priced contracts.

–Bid rotation is where participants in a bid rigging scheme often rotate winning bids by geographic areas or by type of job or by time to give each member a chance to share in the spoils.

Corrupt government and procurement officials can facilitate the bid suppression efforts by disqualifying other legitimate bidders during the bidding process in exchange for bribes from the conspirators.

A red flag is easily seen when the same companies always bid, the same companies always win and the same companies always lose.

Unusual bid patterns also raise red flags, such as the “identical” bids pitched by PhilWorks and NFH during a bidding, very close or too far apart based on prior similar tenders; bids are an exact percentage apart.

I am sure Singson will not miss these red flags. After all, he was placed there by PNoy to clean up this corruption-ridden agency.

etulfo2011@yahoo.com

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