Press Release
January 16, 2014

Nancy seeks clarity in leasing government assets
Bill to formulate rules and procedures

Senator Nancy Binay filed a bill seeking to clarify the rules and procedures in entering into lease agreements with government agencies.

In Senate Bill 2001, the lady senator said that the Government Procurement Reform Act or Republic Act 9184 "does not contemplate lease of government assets."

"Lease of assets are income-generating activities for the State and is well beyond the ambit of the Procurement Act," Binay said.

Assets, according to the bill, are real or personal property, which shall include lands, buildings and building space.

The lease of government owned properties, the Government Procurement Policy Board, said falls under Executive Order 301, or "Decentralizing Actions on Government Negotiated Contracts, lease Contracts and Records Disposal."

The GPPB is the agency responsible for procurement policy formulation and the implementation and monitoring of effective public procurement reform in government.

EO 301, however, Binay said, only provides which agencies have jurisdiction over lease contracts, "but is unclear in the procedure that should be followed by government entities in entering into such transactions."

"The disposition of government assets must be simplified," Binay said, "so that all branches, departments, agencies, subdivisions, and instrumentalities of the government, including government-owned and controlled corporations, and local government units are guided by a mechanism that would ensure proper disposition of government assets."

The Department of Public Works and Highways (DPWH) will be tasked to formulate the standards or guidelines for the determining the reasonableness of the terms of lease contracts and rental rates of the government assets for use by private individual, corporation, association, or other juridical entity.

"The uniform standards or guidelines shall promote ideals of good governance, and shall adopt reasonable terms responsive to present commercial conditions," Binay said.

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