Press Release
October 14, 2020

DTI agency's failure to buy P9 B worth of critical equipment harms frontliners' capability

President Duterte's promises of new equipment for "his beloved uniformed services" are being betrayed by the Philippine International Trading Corporation's (PITC) "failure to deliver them on time or deliver them at all."

The intent of another branch of government - Congress - that appropriated funds be spent immediately is also undermined "by the designated buyer's failure to deliver the goods within the agreed time," Recto said.

"To comply with the President's wishes, nagkukumahog ang DOF to raise money, and Congress is being nagged to pass the annual budget on time, only for procurement entities to waste several fiscal years in making the purchase," Recto said.

Recto said the "pasa-buy" system in which departments transfer billions of pesos to two agencies - the PITC and the DBM Procurement Service - should be constantly monitored by the Office of the President and subject to oversight by the two houses of Congress.

Recto made the statement after COA documents submitted to the Senate showed that PITC failed to utilize the P9.17 billion that agencies gave the DTI-attached agency over a period of 10 years to make purchases on their behalf.

The COA report showed that these unutilized fund transfers made from 2009 to 2019 have not yet been returned to concerned client-government agencies or the National Government, according to Recto.

"Yung isang case dito yung sa PNP. Binigyan ng P1.347 billion in 2016 para sa sasakyan, baril at mga kagamitang kailangan ng pulis. Pero ano resulta? P311 million pa lang na halaga ng mga ito ang naideliver ng PITC," Recto said.

"In the case of the Philippine Army, PITC's completion rate from 2007 to 2019 is 45 percent, which is a high abort figure," Recto said.

"The Philippine Army failed to demand the full refund of long-outstanding balances aged three years and above amounting to P495.279 million, pertaining to the excess or unutilized funds transferred to PITC," Recto said, citing a COA report.

Funds transferred by the Philippine Air Force to PITC for purposes of procurement outsourcing has accumulated to P736.14 million as of end 2019 due to non-delivery of items of requisitioned projects, Recto added.

"Mahaba ang listahan ng utang ng PITC. Marami-rami rin ang nag-aabang ng delivery," Recto said.

He cited the case of the P3.27 billion worth of undelivered buildings and firetrucks to the Bureau of Fire Protection, which PITC was supposed to build and buy.

"They were contracted to build 98 fire stations for a package cost of P892.3 million. Nasemento na ng China ang dagat sa West Philippine Sea, pero itong mga maliliit na building na ito, wala pang full turnover," he said.

Recto said if what is to be procured are big-ticket items like train parts, aircraft and defense equipment, "then maybe the designated buyer should bulk up its in-house technical competence in choosing what to buy."

Recto said he will raise the issue of delayed procurement of critical equipment during the Senate plenary debates on the 2021 National Budget next month.

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