The Office of the Ombudsman indicted former Department of Transportation (DoTr) secretary Joseph Emilio Abaya and 16 others over a P4.2billion contract with several private companies for a three-year maintenance service of the problematic Metro Rail Transit 3 (MRT3).
Ombudsman Conchita Carpio Morales found probable cause to charge Abaya and the other respondents for violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act (Republic Act No. 3019) over the anomalous MRT3 maintenance contract.
Abaya was transportation secretary under the Benigno Aquino administration.
Also facing charges are DoTr Undersecretaries Edwin Lopez, Negotiating Team head Rene Limcaoco and his deputy Catherine Jennifer Francis Gonzales; MRT3 General Manager Roman Buenafe, Assistant Secretary for Procurement Camille Alcaraz, MRT3 Bids and Awards Committee Vice-Chairperson Ofelia Astrera, Attorney Charissa Eloisa Julia Opulencia, Engineering Division chief Oscar Bongon, Engineer Jose Rodante Sabayle.
Private respondents Eldonn Ferdinand Uy of Edison Development and Construction, Elizabeth Velasco of Tramat Mercantile Incorporated, Belinda Tan of TMI Corporation, Inc., Brian Velasco of Castan Corporation, and Antonio Borromeo, Jun Ho Hwang and Elpidio Uy from Busan Universal Rail, Inc. (BURI) were also included in the indictment.
Rigged for a single provider
The Office of the Ombudsman’s Special Panel of Investigators found that in October 2014 and January 2015, the DOTr conducted two biddings for the three-year maintenance service contract for the MRT3.
Both biddings failed due to non-submission of bids.
On 28 January 2015, Abaya issued a Special Order creating the MRT3 Bids and Awards Committee (BAC) for the procurement of goods, infrastructure projects and consulting services of the MRT3 system, the Ombudsman said.
On March 2015, the MRT3 BAC issued Resolution No. 002 recommending it resort to Negotiated Procurement through Emergency Cases under Section 53.2 of the Revised Implementing Rules and Regulations (RIRR) of the Government Procurement Reform Act (Republic Act No. 9184).
Documents, however, show that the contract was set to be awarded to a single maintenance service provider that would establish a Single Point Responsibility for several services, the Ombudsman said.
On 21 December 2015, the MRT3 BAC issued Resolution No. 14 Series of 2015 recommending that the project be awarded to Busan JV.
On 07 January 2016, the DOTr, the MRT3 and the Busan JV entered into a contract for the long-term maintenance contract.
‘Incapable of undertaking maintenance project’
In its Consolidated Annual Audit Report (CAAR) for 2016, however, the Commission on Audit (COA) observed that the “DOTr still failed to provide the riding public with a safe and comfortable transport system even with the procurement and delivery from August 2015 to January 2017 of 48 new LRVs with a total cost of P3,759,382,400.00.”
“Despite four years in the procurement process and total payments of P527,761,083.00 (equivalent to 14 percent of the contract price) to Dalian, the LRVs remain inoperational and unaccepted by the DOTr as of reporting date due to glitches in the power supply and signaling system. These resulted from the DOTr’s poor planning and other major procurement lapses,” the COA added.
The Special Panel of Investigators found that respondents extended unwarranted benefits, advantage and preference to the contractor when it awarded the project to Busan JV, an ineligible and unqualified entity, the Ombudsman said.
“In sum, the Busan JV was not technically, legally and financially capable to undertake the MRT3 long-term maintenance contract. Despite its being unqualified, the contract was still awarded to it by the DOTr, in violation of Section 53 of the RIRR of R.A. No. 9184, which requires that in negotiated procurement, the procuring entity should negotiate with a technically, legally and financially capable supplier, contractor or consultant,” the Ombudsman said.
The panel said then Secretary Abaya has immediate and primary responsibility for all government funds and property pertaining to his agency at the time of the questioned transaction.
Bagong Alyansang Makabayan (Bayan) secretary general Renato Reyes Jr. who led the filing of the complaint against Abaya last November welcomed the Ombudsman’s decision
“These maintenance contracts involving what we alleged are unqualified providers were partly to blame for the sorry state of the MRT3,” Reyes said.
“We are still a long way from achieving justice for commuters and taxpayers but we hope that the case will lead to genuine accountability,” he added.
Reyes advised the Rodrigo Duterte government to likewise examine the policy of privatizing the train system, its functions and maintenance.
“This has been routinely abused by both government officials and private groups to the detriment of the commuters and taxpayers,” Reyes said. # (Raymund B. Villanueva)