Chiz finds ZREC, NABCOR officials feigning ignorance on procurement rules

By Office of Senator Chiz Escudero
September 5, 2013

PASAY CITY – Officials of the ZNAC Rubber Estate Corporation (ZREC) and National Agribusiness Corporation (NABCOR) were grilled by Senator Chiz Escudero on their knowledge of the government procurement rules during the second hearing of the senate blue ribbon committee on the pork barrel scam. ZREC and NABCOR are two of the government implementing agencies Escudero last week asked to be invited to the hearing for their roles in awarding funds to non-government organizations (NGO).

Escudero, chairman of the Senate committee on finance and author of the resolution which asked the senate to probe the pork barrel scam said “those two are agencies commonly appearing as conduits for PDAF releases to seemingly favored NGOs even with questionable existence.”

The senator said under the Government Procurement Policy Board’s (GPPB) Resolution No. 12-2007, which stipulates guidelines on NGO participation in public procurement, there are only two modes of awarding a project to an NGO. One is by public bidding, two is by negotiated procurement.

Escudero was baffled when Allan Javellana, former NABCOR president admitted before the committee that mere endorsement by a legislator already prompted them to award contract to a particular NGO.

Salvador Salacup, current Department of Agriculture assistant secretary and former ZREC president also admitted that “the only set of validation requirements were the SEC, BIR, LGU permits for project experience and certified financial statements.”

“Who told you that those are the only requirements?” Escudero asked. “Was just a policy that was inherited by ZREC,” Salacup answered.

Escudero also asked Salacup if he is familiar with the COA and GPPB rules on NGO participation in public procurement to which the latter said no.

“It is very incredible for these officials to feign ignorance of the existing procurement law which has been in place since 2007. I asked them about this because they have been totally ignoring the laws governing procurement. If it’s a negotiated procurement, the NGO is required to come up with the performance, security or bond equivalent to the amount of the project. This is because in cases like when it reneges or dissolves or disappears, like in most of these 82 NGOs, the government has a hold on them.”

“Now in clear violation of existing laws and regulations, these line agencies simply awarded funding to the seemingly favored NGOs. As long as there are endorsements from legislators, as they admitted, they funneled funds hook, line and sinker.”

Escudero said with the appalling wastage of public funds from the PDAF, he wants to examine if there are remaining pending or on-going PDAF allocations to be implemented by NGOs.