I now understand the exasperation of Pres. Rodrigo Duterte to flaws in the government’s procurement system.
Lowest bidder indeed, is not always good.
I now seem to get a hint why it takes forever to finish repairs at the Sayre Highway in Bukidnon. Even newly finished roads get repaired or replaced And after they are done in a one section of the highway, another segment gets demolished. It does not only inconvenience road users, but may also be a waste of public funds.
Funds looks overflowing from the DPWH for Sayre Highway. But is there such a thing a thing as quality control in these road projects?
At the DPWH regional office in Northern Mindanao, as per PhilGeps data, over P2 billion infrastructure projects are being bidded out this week. Hundreds of millions are also being bidded out in the several district engineering offices in the region.
This should bode well for the build build build mantra of the administration. The public should have special interest in the 2019 projects all over the country as a significant part of the build build build budget comes from proceeds of the increased excise taxes which covers fuel, including cooking gas and other essential commodities.
Many in the construction sector are happy with government’s rapid spending on public infrastructure.
Reality however may paint a different scenario, as big, multi billionaire players in the construction sector are said to be collaborating, forming a cartel, to corner the lion’s share of public infrastructure projects.
This is moat especially disturbing in Northern Mindanao. This cartel may have left many new players from other regions, leaving aghast.
These big players are giving very steep, unheard off discounts to discourage the small, new players — which by technical and financial standards are just as qualified.
The problem with this cut throat strategy is the quality of work on projects. As inflation rises, prices of construction materials soaring, 100% increase in the excise tax on sand and gravel and filling materials, huge discounts or ‘bid dives’ by the big players doesn’t rhyme.
Low quality infra needs more maintenance and lesser lifespan. For highways for example, government cannot just say, wait, but has to repair and/or replace defective roads as soon as this shows cracks and other damages. And when this happens, the big players who may have done a hasty, low quality work, to start with, will again take a lion’s bite in a very short time — vicious cycle.
Cartels dealing with public projects almost always have participation officials of concerned government agencies.
This is something Congress may want to think about as far the procurement system is concerned. In the meantime, the Philippine Competition Commission, the COA may need to flex some muscles and exercise its regulatory powers to level the playing field.