2nd update - world bank
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UPDATE
August 2005
2nd
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COUNTRYPROCUREMENTASSESSMENT
REPORT
Phil ippines
Country Operations and Services UnitEast Asia and Pacific Region
August 2005
THE WORLD BANK
UPDATE2nd
Regional Vice President : Jemal-ud din Kassum, EAPCountry Director : Joachim von Amsberg, EACPF
Sector Director : Marisa Fernandez-Palacios, EAPCOTask Team Leader : Cecilia Vales, EAPCO
Contents
Foreword --------------------------------------------------------------------------------------------------- 9Introduction ------------------------------------------------------------------------------------------------ 11Big Achievements So Far ----------------------------------------------------------------------------- 12Assessment of Progress ------------------------------------------------------------------------------ 16Consolidated Agreed Actions ------------------------------------------------------------------------ 16Procurement Under Foreign Assisted Projects (FAPs) ---------------------------------------- 17Funding Requirement for Agreed Actions -------------------------------------------------------- 19
TableTable 1: Status of Completed, Ongoing and Open Agreed Actions ------------------------ 12Table 2: Procurement Under Foreign Assisted Projects (FAPs) ---------------------------- 17Table 3: Philippine Bidding Documents Harmonized with ADB, JBIC and the WB ----- 18Table 4: Amount of Threshold per Contract for Procurement Methods and Prior Reviews ----------------------------------------------------------------------------------------- 19
AppendicesAppendix 1 - List of CPAR 2nd Update Mission Participants ---------------------------------- 21Appendix 2 - Speech of Undersecretary Laura B. Pascua ----------------------------------- 23Appendix 3 - Summary of Achievements and Ongoing Agreed Actions ------------------ 25Appendix 4 - Status of Procurement Training and G-EPS Update ------------------------- 37Appendix 5 - Report on Progress of Reform in LGUs ----------------------------------------- 41Appendix 6 - Report on Progress of Reform in the Health Sector ------------------------- 47Appendix 7 - Report on Progress of Reform in the Education Sector --------------------- 50Appendix 8 - Baseline Indicator System Report ------------------------------------------------ 53Appendix 9 - Matrix of Weaknesses and Targeted Activities (as of November 2004) - 73Appendix 10 - Procurement Annex to the Loan Agreement --------------------------------- 77Appendix 11 - CPAR Update February 2004----------------------------------------------------- 79
Acronyms and AbbreviationsADB - Asian Development BankAIM - Asian Institute of ManagementAO - Administrative OrderBAC - Bids and Awards CommitteeBSP - Bangko Sentral ng PilipinasBOT - Build-Operate-and-TransferCIAP - Construction Industry Authority of the PhilippinesCDF - Countryside Development FundCIDA - Canadian International Development AgencyCOA - Commission on AuditCPAR - Country Procurement Assessment ReportCPPR - Country Portfolio Performance ReviewCSC - Civil Service CommissionDBM - Department of Budget and ManagementDepEd - Department of EducationDILG - Department of the Interior and Local GovernmentDOJ - Department of JusticeDOH - Department of HealthDPWH - Department of Public Works and HighwaysDTI - Department of Trade and IndustryEO - Executive OrderEPS - Electronic Procurement SystemGAAM - Government Accounting and Audit ManualGEF - Global Environment FacilityG-EPS - Government Electronic Procurement SystemGFI - Government-Financing InstitutionGOCC - Government-Owned and/or Controlled
CorporationGOP - Government of the PhilippinesGPIS - Government Procurement Information System
GPPB - Government Procurement Policy BoardGPRA - Government Procurement Reform ActICB - International Competitive BiddingINT - Department of Institutional IntegrityIRRs - Implementing Rules and RegulationsJBIC - Japan Bank for International CooperationLC - Letter of CreditLCE - Local Chief ExecutiveLGU - Local Government UnitLOI - Letter of InstructionsNBI - National Bureau of InvestigationNCB - National Competitive BiddingNGA - National Government AgenciesNGO - Non-Government OrganizationNEDA - National Economic and Development AuthorityOSG - Office of the Solicitor GeneralPCAB - Philippine Constructors Accreditation BoardPEAC - Pre-qualification, Evaluation and Awards CommitteePD - Presidential DecreePPB - Procurement Policy BoardPSB - Philippines Shippers’ BureauPS - Procurement ServicePWI - Procurement Watch, Inc.TIP - Transparency International PhilippinesTTL - Task Team LeaderTWG - Technical Working GroupWB - World BankWBOM - World Bank Office ManilaWG - Working Group
Acknowledgements
The Country Procurement Assessment Report(CPAR) Second Update report was prepared in No-vember 2004 by a Team led by Cecilia Vales (SeniorProcurement Specialist). The Team comprised JoelTurkewitz (Senior Public Procurement Specialist),Rene Sd. Manuel (Procurement Specialist), DominicAumentado (Procurement Specialist), Noel Sta. Ines(Procurement Specialist), Jose Luis Syquia (Consult-ant) and Evelyn Quirante (Program Assistant). TheTeam worked closely with representatives from theAsian Development Bank: Richard Ondrick, (ChiefCountry Officer), Jimmy Wu (Portfolio Manager) andCesar Valbuena (Procurement Specialist), and the Ja-pan Bank for International Cooperation: Izuru Kimura(Representative) and Flerida Chan (Project Officer).
The success of the CPAR process was largelyattributed to the ownership and commitment toprocurement reform demonstrated by theGovernment’s Procurement Policy Board (GPPB) andits Technical Support Office (TSO), led by LauraPascua (Undersecretary, Department of Budget andManagement) representing the GPPB Chairman andJose Martin Syquia (Executive Director, GovernmentProcurement Policy Board, Technical Services Office).GPPB representatives who participated were: ArcadioCuenco (Assistant Commissioner, Commision onAudit), Elmer Dorado (National Economic andDevelopment Authority), Antonio Molano, Jr.(Director, Department of Public Works andHighways), Aida Carpentero (Director, Department ofEducation), Ricardo San Andres (Assistant Secretary,Department of National Defense), Joselyn Alvarado(Assistant Secretary, Department of Science andTechnology, Loraine Sanchez (Director, Departmentof Finance), Ireneo Vizmonte (Director, Departmentof Trade and Industry) and Arturo Baloaloa (Director,Department of Energy).
We would also like to acknowledge the activeparticipation of other government officials:Constancia de Guzman (Chairperson, PresidentialAnti-Graft Commission), Teodoro Encarnacion(Presidential Assistant on Infrastructure Projects). Theprivate sector was represented by Manolito Madrasto(Philippine Constructors Association) and Aristo Mitra(Philippine Institute of Certified Public Accountants).Civil society organizations stalwarts providedenlightened discussion on governance, such asJosefina Esguerra (Executive Director, ProcurementWatch, Inc.), Jose Concepcion (Chairman,NAMFREL), Father Vicente Cajilig (Center forContextualized Theology and Ethics, University ofSanto Tomas and others who are named in Appendix1 – List of Participants.
This Report is a follow-up of the original CPAR, whichwas part of the Public Expenditures, Procurement andFinancial Management Review, and the CPAR Updatewhich was published in February 2004. The originalCPAR was prepared in June 2002 and published inMarch 2003, by a Team led by Christian A. Rey (TaskTeam Leader).
Publication review and advice were received fromLeonora Gonzales (External Relations Officer) whoalso acted as Communications Adviser. Overall designand layout of the Report was done by Horace Crowe(Consultant).
Chris HobanManager, Portfolio and OperationsManila, Philippines
Foreword
It has been three years since the comprehensive assess-ment of the Philippines public procurement system wascompleted and published in the Country ProcurementAssessment Report (CPAR) in June 2002. Substantialprogress has been made since major procurement re-form activities identified at that time were completedand are now being implemented. The CPAR processachieved its goal of being an analytical tool to help as-sess the public procurement system in the Philippinesand in the process helped to generate a dialogue withthe Government to improve procurement practices, andto help civil society and the private sector understandbetter the processes and procedures in place at that time.Following the significant progress reported in the No-vember 2003 CPAR Update, this Second Update aimsto: (a) record the status of agreed actions and analyzetheir relevance to existing priorities; (b) benchmark theprocurement reform progress against international stan-dards and in the process identify its strengths and weak-nesses; (c) discuss and agree on measures to addressthe weaknesses; and (d) review the status of harmoni-zation and/or alignment activities. This CPAR 2nd Up-date was also used to identify governance issuespertaining to procurement for input to the preparationof the World Bank’s Country Assistance Strategy for2006 to 2008.
This new Strategy supports reforms like these, whichare examples of “islands of good governance.” Thesereforms help fight corruption and support better gover-nance in the public sector, eventually resulting in im-proved services to the poor. While there are still manychallenges in implementing these reforms, the achieve-ments cited in this Report demonstrate that there arealso many successes that we can encourage, and em-power and enable others to build upon.
It is laudable that consistent Government ownership ofthe CPAR process, through the Technical Support Of-fice of the Government Procurement Policy Board, wasevident in this CPAR 2nd Update, and that the jointCPAR Mission from November 2 to 5, 2004 resulted ina fruitful dialogue as the Report presents. It is alsoremarkable that many development partner organiza-tions were able to participate, and civil society organi-zations and their members could air their issues,concerns and suggestions. The result is a documentthat truly captures the Philippines’ many achievementsin procurement reform, provides a benchmark on theprogress made compared with international standards,identifies strengths and weaknesses, and records theagreements in moving the reforms forward.
Finally, it is worth citing the significant achievementmade in the harmonization and alignment efforts in theuse of country systems. Foremost of these are theharmonization of the bidding documents for works,goods and consulting services across many governmentagencies and with the international developmentpartners policies and procedures. The documents arenow being used for all national public procurement byevery entity, including the Local Government Units.
We wish to commend the executive and legislativebranches of government for continuing to pursue a keygovernance measure that will reduce corruption in thelong term. Much now will depend on the ongoingimplementation, monitoring and enforcement of theseinstitutional and policy reforms to ensure theirsustainability in achieving good governance.
Joachim von AmsbergCountry Director, PhilippinesWorld Bank Office ManilaAugust 2005
11COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
I. Introduction
1. Overview
The Country Procurement Assessment Report(CPAR) process proved to be a successful mechanismin assessing the country’s public procurement system,identifying its strengths and weaknesses, andproviding an avenue for a dialogue among keystakeholders to address the weaknesses. The June2002 CPAR, and its subsequent first update inNovember 2003, resulted in an agreement to act uponsixty-six (66) activities to address the existingweaknesses in the country’s public procurementsystem. So far, as discussed in Section II of thisCPAR 2nd Update, ninety five percent (95%) wereeither completed or ongoing as of November 2004.On account of the improvements made, it is necessaryand critical therefore to follow-up the implementationof agreed actions in particular, and the overallprogress of the procurement reform in general. It isalso important to determine and assess the impact ofthe Reform thus far, its strengths and weaknesses,and again use the updated CPAR as a tool for dialogueon how to address the weaknesses uncovered. Alongthis line, a Joint CPAR 2nd Update Mission wasconducted from November 2 to 5, 2004, with thefollowing main objectives: (a) to assess the progressof procurement reform and identify priority areas forthe next three years; (b) review the status of thePhilippines’ Procurement Harmonization Programand identify next steps; (c) review internationalexperience on procurement monitoring andperformance measurement; and (d) firm up the rolesof civil society organizations and the private sectorto achieve sustainability.
2. Ownership
The procurement reform process on the part of theGovernment had been very strong since the originalJune 2002 CPAR, and that is evident in this 2nd
Update. The GPPB, through its TSO, participatedfully in defining the objectives and the variousactivities of the Mission, the identification of priorityareas, the execution of this second Mission and inthe formulation of the agreed actions and expectedlead times for completion. The improvements in thecountry’s procurement reform are, therefore, drivenby the Government. The development partners’assistance came in the form of funding resources andproviding expert advice on international procurementbest practices.
3. Mission Preparatory Activities andSchedule
The CPAR Team reviewed and updated the originalCPAR Agreed Action Plan in advance of the actualMission as detailed in Section II of this 2nd Update.The GPPB spearheaded two major activities thatdetermined the way forward: (a) a meeting ofprocurement experts on October 22, 2004 identifiedthe reforms’ next key priority areas; and (b) anassessment or benchmarking of the reforms’ progressusing the Baseline Indicator System (BIS) done by aTechnical Working Group composed of Ms. FleridaArias, Atty. Pia Zobel Ruiz and Atty. Jose LuisSyquia. Thus, these preparatory activities resultedin a compressed four-day Mission that coveredextensively the substantial areas of the
12COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
to the Public Works Sector as discussed in Section6 of this 2nd Update.
4. Completed Agreed Actions at theNational Level
The foundation of the reform lies in thepromulgation of the Government ProcurementReform Act (Republic Act No. 9184) in January2003 and the issuance of its Implementing Rulesand Regulations (IRRs) in September of the same
year, which covers allgovernment entities,including local governmentunits. Consultations withthe civil society at large andcomments from donorinstitutions strengthened
the reform measures mandated by the Law and itsIRRs. This was followed by concerted efforts todevelop harmonized bid documents and thus, thefollowing key reform measures are now in place andbeing implemented:
a. A single oversight body called the GovernmentProcurement Policy Board (GPPB);
b. Procurement planning and budget linkagethrough the Annual Procurement Plan;
c. Approved Budget for the Contract as ceiling forbid prices;
d. Use of Government Electronic ProcurementSystem becomes mandatory, including the post-ing of bid opportunities and awards of contracts;
e. Fixed responsibilities and accountabilities of theBids and Awards Committee (BAC), BAC Sec-retariats, Technical Working Groups, and thebidders;
f. A national and local training program for capac-ity building on the new procurement system, itsdocuments and forms – the Status of Procure-ment Training on the Laws, Rules and Regula-
progress of the Reform. In her welcome remarks,Undersecretary Pascua set the Mission’s and thereforms’ direction and reiterated the Government’sresolve in pushing procurement reform forward(Appendix 2).
II. Big Achievements So Far
Laudable achievements have been made since theJune 2002 CPAR, as listed in the Summary ofAchievements and Ongoing Agreed Actions inAppendix 3. Table 1 presents asummary status. The first updateto the CPAR recorded sixty-six(66) agreed actions. As ofNovember 2004, 42 or 64 %were completed, 19 or 29% wereongoing as of November 2004while only 5 or 7% were not yet started.
It is worth mentioning the reforms’ progress on thenational and local levels where forty-one agreedactions were completed and/or ongoing as ofNovember 2004, resulting in a 95% completionrecord. The two remaining actions not started werethose pertaining to: (a) development of a goodrecord-keeping system for LGUs and, (b) trainingof Government E-Procurement System staff and theCommission on Audit (COA) in the area of systemsecurity. On the other hand, the twenty (20) sectoralactions (Education, Health and Public Works)completed and/or ongoing agreed actions consistedof 87% of the total for the three sectors. Theremaining actions not started are those pertaining
National/Local Levels 27 14 2 43Sectoral Levels 15 5 3 23Total 42 19 5 66
Percent 64% 29% 7% 100%
Completed On-Going Open TOTAL
Table 1: Status of Completed, Ongoing and OpenAgreed Actions
The reforms’ progress on the nationaland local levels where forty-one agreedactions are completed and/or ongoingas of November 2004; resulting in a 95%completion record.
13COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
tions for the period October 2002 to December2004, and the status of the procurement trainingconducted by the Government ProcurementPolicy Board – Technical Support Office (GPPB-TSO) from October 2002 to December 2004 andstatus report on the G-EPS are shown in Appen-dix 4;
g. Move towards professionalization of procure-ment officials;
h. Use of standard bidding forms and manuals –the standard bidding documents for works, goodsand consulting services as harmonized with de-velopment partners institutions are discussed inSections 13 to 15 of this Report;
i. Standard bidding procedures using non-discre-tionary bid evaluation criteria;
j. Mandated lead-time for each procurement step;k. Stricter rules on alternative methods of procure-
ment;l. Clearly defined protest mechanism;m. Penal, civil and administrative sanctions against
erring procurement officers, bidders and contrac-tors;
n. Legal assistance and indemnification packagesfor BAC members who are subjected to harass-ment;
o. Strengthened involvement of civil society organi-zations, professional associations and non-gov-ernment organizations in policy formulation andreform implementation;
p. Harmonized standard bidding documents con-taining provisions on fraud and corruption, con-flict of interest and prohibition against relativeswithin the third civil degree of consanguinity andaffinity; and
q. Issuance of Rules for Blacklisting and Suspen-sion of Bidders, Constructors, Suppliers and Con-sultants.
5. Implementation in Local GovernmentUnits
The Procurement Law repeals the procurementrelated sections of the Local Government Code,thereby making the new law and its IRRs mandatoryfor all LGUs. One of its major reforms is prohibitingthe Local Chief Executive being directly involved inthe bidding process, since it provides that the BACChairman should not be the head of the procuringentity. Conversely, training of LGUs’ staff on thenew procurement system are ongoing through theComposite Team of Regional Trainers, where eachTeam is comprised of trainers from DBM, DILG,COA, and the Philippine League of Local BudgetOfficers. As of December 2004, seventy-two (72)provinces, or 91% of the total number of provincialgovernments, one thousand one hundred seventy nine(1179) municipalities or 79% of the total number ofmunicipal governments, and one hundred nine (109)cities or 92% of the total number of city governments,were trained, accounting for 80% of the localgovernment units. Appendix 4 of this Report providesa detailed account of the training in the LGU level asof November 2004. While capacity building isunderway, remaining concerns are: (a) the need todevelop a mechanism to accredit procurementlecturers, organizations and training programs toensure that quality is maintained; (b) inadequatekeeping of procurement records in most LGUs; and(c) monitoring of actual procurement performance.A detailed report on progress of the reform in theLGUs is in Appendix 5.
6. Progress of the Reform in KeySectors
The results of the implementation of reform measuresover the three year period are exemplified in the threesectors that were subjected to institutional analysis.
14COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Summaries on the progress made in each sector arepresented below:
Health. All agreed actions in the June 2002CPAR have been completed, except for the re-view and implementation of reforms in terms ofdecentralizing procurement. In this regard, De-partment Memorandum No. 74 was issued in-forming all Directors of the Centers for HealthDevelopment to: (a) constitute their Bids andAwards Committee (BAC); (b) institutionalizethe Annual Procurement Plan; and (c) institution-alize a procurement monitoring system that willensure adherence to the new law, its IRRs andstandard documents and forms. However, sup-port is needed in: (a) developing and conductingtraining programs on the new procurement sys-tem; and (b) the development of the Contract Dis-tribution System into a fully functional andeffective system that is utilized in all regions. Thedetailed report on the Health Sector is attached asAppendix 6.
Education. Almost all agreed actions identifiedin the June 2002 CPAR were accomplished, no-table of which was the adoption of the competi-tive bidding process for textbooks which resultedin greater efficiency and economy. The focus nowof the Department of Education (DepEd) is thecreation of its own Procurement Service Unit andthe operation of a national textbook delivery pro-gram to ensure that the books reach the students.It is necessary to support DepEd in its down-stream reform actions, such as the conduct oftraining sessions to build capacity on such mat-ters as procurement planning, database andrecords management, local and international pro-curement practices, and project management. ASpecial Report detailing the progress in this sectoris presented in Appendix 7.
Public Works. Agreed actions recorded in theCPAR that were completed include: (a) use of acomputerized registry for eligibility screening; (b)issuance of amendments to the Arbitration Law;(c) a report on capacity, quality and size of con-tracts for works under foreign assisted projects,including the mix of national and foreign fund-ing; (d) a report on bid prices/variation ordersrelative to engineer’s estimates in projects withand without fixed budget ceilings; (e) download-ing of bid documents from agency websites; and(f) the introduction of value engineering throughcase studies. However, there are agreed actionsthat remain incomplete or not started. These are:(a) rationalization of licensing procedures andharmonization with eligibility screening require-ments; (b) use of a computerized registry in allprojects including those procured in provincesand districts; (c) strengthening the quality assur-ance mechanism for design and supervision; and,(d) specialized training on cost estimation andanalysis of bid variances. A review of theseagreed actions resulted in new lead times for theircompletion.
7. Civil Society Observers
The need for civil society’s participation in theprocurement process was enabled by R.A. 9184 andits IRRs particularly by being “observers” in all stagesof the procurement process to enhance itstransparency and monitor the agencies’ compliancewith the Law, and implementing rules and regulations.In pursuing this objective, the GPPB arranged a
Civil Society Observers are “observers” inall stages of the procurement process toenhance its transparency and monitor theagencies’ compliance with the Law andIRRs.
15COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
meeting of the various civil society organizations(CSOs), professional associations (PAs), non-government organizations (NGOs), religious groups,and the academe who have been actively participatingin monitoring procurement activities and goodsdelivery. The participants recommendedestablishment of a CSO Alliance comprising PWI,as the secretariat, the Catholic Bishops’ Conferenceof the Philippines (CBCP), the University of SantoTomas Center for Contextualized Theology & Ethics(UST- CCTE) and Social Research Center (UST-SRC), National Movement for Free Elections(NAMFREL), Philippine Constructors Association(PCA), Confederation of Filipino ConsultingOrganizations Inc. (COFILCO), the Bishops-Businessmen’s Conference (BBC), and theTransparency and Accountability Network (TAN).The CSO Alliance proposed: (a) a massiveinformation campaign on the new public procurementsystem, its documents and forms; (b) institutionalizingthe standard monitoring system for BAC observersand a case-handling system linked to the Office ofthe Ombudsman; (c) screening and accreditingobservers; and (d) providing for an informationsupport system for trained CSOs.
8. Private Sector
Constructors, suppliers and consultants are importantpartners in the operation of the public procurementsystem and in the implementation of the reform. Theyrecognized that the new Government ProcurementReform Act provides more transparent and efficienttechnology and more objective standards. However,they have two main concerns: (a) insufficientknowledge and lack of understanding of the new lawand system; and (b) the stringent qualificationrequirements of foreign assisted contracts. To addressthese, they have a number of ongoing initiatives suchas: development of an accreditation system internalto their association, briefings and seminars on the law,
introduction of a professional indemnity insurance,and promotion of joint ventures with local and foreignpartners. However, it was felt that these initiativesare not enough and more resources are needed. Theyrecommended that Government should consider: (a)the inclusion of the private sector in the nationaltraining program; (b) 7adoption of a policy on valueengineering; (c) improving the validation process ofdocumentary submissions of constructors; and (d)rationalizing the foreign assisted contracts’requirements for average annual turnover (AAT), theexperience qualification for international competitivebidding (ICB) and the amount of threshold forNational Competitive Bidding (NCB).
9. Anti-corruption Program
The Government, in April 2001, issued a directivereconstituting and enlarging the powers of thePresidential Anti-Graft Commission (PAGC,formerly Presidential Commission Against Graft andCorruption). Chairperson Constancia De Guzmanadvised the meeting of its mandate and activities.Among its tasks is to strengthen the integration ofanti-corruption efforts in the entire bureaucracy thatincludes key agencies such as: the Commission onAudit, the Ombudsman, the Civil ServiceCommission, the National Bureau of Investigationand the Department of Justice. With the appointmentof Chairperson De Guzman, major policy andoperational changes are underway to reducecorruption. On procurement matters, the plan is tostrengthen the role of internal audit units in allagencies, which will serve as the monitoring andenforcement arm of the executive leadership inimplementing its anti-corruption program. The outputof internal audit units will bridge the critical gap fromimplementation to enforcement by COA and theOffice of the Ombudsman. The CPAR Teamrecommended that this program and its keyimplementer, PAGC, be supported.
16COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
III. Assessment of Progress
10. Baseline Indicator System
In her speech that opened the CPAR Mission,Undersecretary Pascua mentioned that the “BaselineIndicator System (BIS)” recently developed by theOECD-DAC/WB offers a systematic way ofbenchmarking the country’s procurement reformefforts against established indicators for achievingeconomy, efficiency, transparency and equalopportunity for bidders. As a pre-Mission activity, aBIS Technical Working Group was tasked to assessstructural performance and determine the progressof the Philippines’ public procurement system on fourkey areas consisting of twelve (12) indicators thatwere the core components of a good publicprocurement system. The Report as adopted by theCPAR Team is presented in Appendix 8. The BISdemonstrates that the components of an effectiveprocurement system have been put in place, and nowthe challenge is to manage those components toachieve improved outcomes. It was emphasizedduring the Mission by Mr. Joel Turkewitz of theBank’s Central Procurement Unit that the BIS needsa separate set of indicators to measure actualprocurement performance supported by a monitoringand data collection system from implementing unitsup to the oversight agency.
11. Strengths and Weaknesses
Applying the BIS result, the Philippines reformachievement garnered an overall score of 68%, whichtranslates to the percentage of the twelve indicatorswhere more than fifty percent (50%) of baselineelements have been substantially met. The reformachievements done so far account for passing thestandard in the following benchmarks: (a) legislative
and regulatory framework; (b) existence ofimplementing regulations and documentation; (c)mainstreaming procedures into public financialmanagement; (d) functional normative body at thecenter; (e) existence of contract administration anddispute resolution provisions; (g) presence of anappeals mechanism; and (h) structural, ethics andanti-corruption measures. However, there are fivespecific benchmarks where 50% or less of thebaseline elements are met. These are: (a) existenceof institutional development capacity; (b) efficientprocurement operations and practice; (c) functionalityof the public procurement market; (d) effective controland audit system; and (e) degree of access toinformation.
12. Matching of Agreed Actions
Having identified the lacking elements in the currentsystem, the Mission discussed the steps which areneeded to address the gap. Ongoing activities werematched to the specific elements and new activitieswere agreed on to ensure that the identified gaps areaddressed. This resulted in a consolidated agreedaction plan as discussed in the following paragraphs.
IV. Consolidated Agreed Actions
Based on the result of the BIS and the matching ofongoing and new activities to address the gap, theCPAR Team adopted a consolidated agreed actionplan (Matrix of Weaknesses and Targeted Activies(as of November 2004) as shown in Appendix 9.Amongst the key new actions are:
Inclusion of the private sector and the CSOs inthe national training program;Provision of administrative support to the CSOAlliance;
17COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Replication of appropriate BIS for national agen-cies and LGUs to monitor actual performanceunder the law;Development of actual performance indicatorsand implementation of a system for data collec-tion and information analysis;Support for strengthening the role of PAGC, in-cluding through the internal audit units of eachagency; andIssuance of policies on value engineering and pro-curement security instruments.
IV. Procurement Under Foreign
Assisted Projects (FAPs)
In January 2003, the Government and its developmentpartners, ADB, JBIC and the World Bank agreed toharmonize six procurement areas to reducetransaction costs, simplify procedures, facilitatedecision-making and reduce capacity building costsfor foreign assisted contracts. The move towardsfurther reliance in the Philippine’s country systemswill depend largely on completion of theharmonization activities. Since then, four of theseareas are either ongoing or completed as shown inTable 2.
13. Philippine Bidding Documents(PBDs) Harmonized with ADB, JBIC and
Table 2: Procurement Harmonization as of June 30, 2005
Area
1. ImplementingRules andRegulations
2. Biddingdocuments forworks, goodsand consultingservices
3. Training andcertificationprogram
4. Procurementmanual
5. Procurementreportingformat
6. Registrationand licensingprocedureswith eligibility
Update as of June 30, 2005
Done. IRRs for domestic funded contractswere issued in September 2003. FAPsare covered by Sections 4 and 43 of theLaw.
Done in August 2004. Works and GoodsDocuments harmonized with ADB, JBICand WB. Consulting Service harmonizedwith WB.
Ongoing. Included in theprofessionalization study.
Ongoing. Procurement Manual draftedand will be harmonized simultaneous withissuance in January 2006. Seven (7)national agencies, one (1) GOCC, andone (1) LGU were selected as pilots.
Not yet started. To be donesimultaneously with ProcurementManual’s harmonization.
Not yet started.
Expected CompletionDate
Done
Done
June 2006
January 2005; pilot testingto start April 2005
June 2006
June 2005
FundingSupport
USAID andWB-IDF
WB
WB-IDF
USAID andASEM 2Grant
ASEM 2Grant
To proposefor a WB-IDF Grant
18COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
the WB
The country’s Procurement Harmonization Programtook a big leap forward with the issuance of GPPBResolution No. 10-2004 dated August 20, 2004, asamended by GPPB Resolution No. 01-2005 datedJanuary 24, 2005 requiring mandatory use, by July1, 2005, of the PBDs for Works and Goods asharmonized with ADB, JBIC and the World Bank,and the PBDs for Consulting Services as harmonizedwith the World Bank. The mandatory use of thedocuments is enforceable by law based on Section 6and Article VI thereof, providing as wellcorresponding penalties for violators. From the firstidentification of conflicting rules for each document,to workshops and discussion meetings, and then tofinal compromises to harmonize the conflicting rules,it took nineteen months to finish the initial editionwhich became the first harmonized biddingdocuments issued within the East Asia and PacificRegion. The magnitude of this achievement isdescribed in Table 3.
14. Differences with the World BankRules and Updating the LoanAgreement’s Annex to ProcurementSchedule
The Loan Agreement’s Annex to the ProcurementSchedule identifies unacceptable nationalprocurement rules that do not conform to procurementbest practices. Prior to the issuance of the HarmonizedBidding Documents, there were nineteen nationalrules for Works and Goods that were unacceptableto the Bank and were included in the NCBProcurement Annex to all Loan Agreements. Whilethe harmonization process was not 100%, its outcomedrastically reduced the differences from nineteen rulesto eight (8), a reduction of 60%, that are nowidentified in the NCB Procurement Annex. On the
Table 3: Harmonized Bidding DocumentsHarmonized with ADB, JBIC and the WB
BiddingDocuments
Original Numberof ConflictingParagraphs
HarmonizedParagraphs
RemainingUn-harmonizedParagraphs
PercentHarmonized (%)
Number of ConflictingParagraphs In:
ConsultingServices
171
162
9
95%
Works
128
101
27
79%
Goods
145
117
28
81%
other hand, the differences between the national rulesfor Consulting Services has been reduced from six(6) to four (4) rules; a reduction of 33%. Moreover,it is an evolving process since adoption of thedocuments will provide more avenues for furtherharmonization. The differences, which are the basisfor revising the standard Annex to the ProcurementSchedule of Loan Agreement are adopted by theGovernment. Affected Loan Agreements have beenamended accordingly. See Appendix 10 for the lateststandard Procurement Annex to Loan Agreement.
15. Threshold per Contract forProcurement Methods
With the progress in the harmonization effortsbetween the Government of the Philippines and donoragencies as shown by the positive rating attained byapplying the BIS, the number of agreed actionsongoing and concluded, and the current capacities ofcontractors and suppliers in terms of volume and sizeof contracts the amount of thresholds per contractfor the different types of procurement methods and
19COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
prior reviews requires a proportionate adjustment toproperly integrate the current state. Subject to theassessment of the procurement needs and content ofthe project, the revised threshold for each method ofprocurement is presented below in Table 4.
16. Prior Review Threshold
A Procurement Capacity Assessment will be appliedto each new project which will include the risk rating
for the project. The thresholds identified in Table 4and the prior review thresholds will be adopteddepending on the risk rating resulting from theAssessment.
V. Funding Requirement forAgreed Action
17. Possible Funding Sources
Aside from ADB, JBIC and the World Bank, otherdevelopment partner agencies such as: USAID,CIDA, EU, UNDP and AUSAID met with the CPARTeam to discuss the consolidated agreed actions andpossible funding resources. The EU has indicatedits readiness to fund the activities of standardizationof specification on commonly used items. The ADBagreed to review its possible funding on the expansionof the G-EPS. USAID proposed to revive the Anti-Corruption Summit for the Philippines. The WorldBank proposed for GPPB to fully utilize the IDFGrant on Procurement Oversight Agency and theASEM 2 Grant on Strengthening ProcurementInstitutions for Good Governance. The CPAR 2nd
Update Mission agreed to have a separate meetingto flesh out funding requirements.
The February 2004 CPAR can be found in Appendix11.
Item
ICB
NCB
NationalConsultantShortlisting
Category Amount per Contract
Works Over $5,000,000Goods Over $1,000,000
Works Over $200,000to $5,000,000
Goods Over $100,000to $1,000,000
Consulting Not more thanServices $200,000
Amount of Threshold per Contract forProcurement Methods
Table 4: Amount of Threshold per Contract forProcurement Methods
21COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Appendix 1 - List of CPAR 2nd Update Mission ParticipantsGovernment Procurement Policy Board
Laura Pascua, Undersecretary, DBMAntonio Molano, Jr., Director, DPWHCarlos Madamba, Jr., Senior Economic Development Specialist, NEDAArcadio Cuenco, Assistant Commissioner, COAIreneo Vizmonte, Director, DTIJoeelyn Alvarado, Assistant Secretary, DOSTAida Carpintero, Director III, DepEdLorraine Sanchez, Designated Head, DOFRicardo San Andres, Assistant Secretary, DNDTheresa Ann Diaz, Director III, DOHManuel Ocampo, Director of Information Technology and Management Services, DOERobert Martinez, Director DTIArturo Baloaloa, Director, DOE
Government Procurement Policy Board-Technical Staff Office
Jose Martin Syquia, Executive DirectorElmer Dorado, Assistant Executive DirectorDennis Nacario, StaffGenmaries Entredicho, StaffPia Zobel Ruiz, StaffDana Marie Casiano, StaffMila Manalastas, StaffAlvin Dellora, StaffMa. Lourdes Tuazon, ConsultantJeff Taylor, Consultant
Other Government Officials
Teodoro Encarnacion, Presidential Assistant, Office of the PresidentConstancia de Guzman, Chairperson, PAGCFiorello Estuar, Private Sector Member to GPPBArnaldo Reyes, Program Development Officer II, DOSTChristine Gulmatico, Administrative Officer V, DepEdMary Grace Quintano, State Counsel IV, DOJKenneth Ronquillo, Director, DOHJoel Lazo, Director, DOH
Civil Society Organizations
Josefina Esguerra, Chief Executive Officer and President, PWICipriano Ravanes, Executive Director, PWIJose Concepcion, Jr., National Chairman, NAMFRELNestor Malapajo, Jr., Officer-In-Charge, NAMFRELRev. Fr. Vicente Cajilig, OP, Director, UST-CCTEPablito Baybado, Assistant Professor, UST-CCTEJose Lugay, Chairman, Advocacy Against Graft & Corruption, CBCPEdgardo Tirona, Member Committee, CBCPMia Munoz Zafra, Member Committee, CBCPVictorino Guiterrez, Member Committee, CBCP
22COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Private Sector
Manolito Madrasto, Executive Director, PCAArmando Alli, President, COFILCOCesar V. Tuason, Second Vice President, COFILCOAriston Mitra, Member, PICPA
Asian Development Bank
Richard Ondrik, Chief Country OfficerShouhua Wu, Senior Portfolio Management SpecialistCesar Valbuena, Procurement Specialist
Japan Bank for International Cooperation
Isuru Kimura, RepresentativeFlery Chan, Project Officer
Other Development Partners
Angus MacDonald, Counsellor, Development Cooperation, AusAIDGerard Belanger, Head of Aid, Canadian EmbassyChristina Pineda, Senior Program Officer, Canadian EmbassyMichael Yates, Mission Director, USAIDFrank Hess, Operations Counsellor, EUDeborah Landey, Resident Coordinator, UN
World Bank
Joel Turkewitz, Senior Public Procurement SpecialistCecilia Vales, Senior Procurement SpecialistNoel Sta. Ines, Procurement SpecialistDominic Aumentado, Procurement SpecialistRene Manuel, Procurement SpecialistEvelyn Quirante, Program AssistantAlice Tiongson, ConsultantJose Luis Syquia, ConsultantNoriel Sicad, Consultant
23COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Appendix 2 - Speech of Undersecretary Laura B. Pascua
Good morning, on behalf of Secretary Boncodin whochairs the GPPB, let me welcome all of you to this2rd CPAR Mission. And let me thank the WorldBank (WB) for initiating and hosting this Mission.If I recall, our first CPAR was done in 2001-2002 inthe context of a bigger effort to review the financialmanagement, expenditure management and procure-ment reforms being pursued by government. Wewere still shepherding the Government ProcurementReforms Act in Congress and hence the agreed ac-tions then had to do with the successful passage ofthe law, preparing the IRRs, linking it with the newCOA Audit Manual, establishing the GPPB, and en-suring that important safeguards were put in placelike ensuring the LGUs and NGOs were consulted,setting up a national training program, making pro-curement planning mandatory, and ensuring thatthere would be no negotiations after determinationof best bid.
During the 2nd CPAR last year, as a result ofsuccessful passage of the law and the importantcompletion of IRR-A, and development of the guidefor local procurement, three out of five commitmentsthat I mentioned above were judged asaccomplished, including agency specific actions likeadoption of the pass/fail criteria in DPWH,standardization of estimated cost per bidding fortextbooks, and streamlining of textbooks’ contentevaluation, the review of the staffing of theProcurement and Logistics Server in DOH, and theDrug Price Monitoring System. During that 2nd
CPAR, 13 more emerging issues dealing withstrengthening Procurement Practices and Processeswere identified.
We meet today to look at Progress made on thesecommitments, 43 all in all, left uncompleted fromthe 1st and 2nd CPARs, to look at problems holdingup their accomplishment and to solve them oridentify the next steps in instances where substantialaccomplishment have been made. Today andtomorrow, we also look at the initial findings andprogress report made on technical assistanceprojects, which are being pursued as part of thisCPAR funded from the grants from the WB. Theseinclude the diagnostic study to strengthen the PS inthe light of the GEPS, the recommendation toprofessionalize the procurement function ingovernment, the study of the capacities of localcontractors and suppliers and the introduction ofValue Engineering to improve the design and costefficiency of proposed infrastructure projects.
This is why the GOP and the WB decided to expandthe participation to this CPAR Mission to includeall GPPB members of the Interagency BAC whohave approved these projects and, as majorprocurement departments, would have a stake inthese TAs as well as the pursuit of some of the 43commitments I mentioned above.
But the different donor organizations have a stakealso in these procurement reforms and we wouldlike to thank the USAID for helping us pass theprocurement law and helping finance the draftingof the procurement manual which is shortly to bepresented to the GPPB, the CIDA for financing thelast 3 years of the GEPS pilot using the MerksSystem and helping us ensure the properdevelopment of our own GEPS. And the EU and
24COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
WB for giving the grants by which we are able tofinance the training of all government procurementpersonnel in the NGA, GOCCs and LGUs in theGPRA and its IRRs and now in the SBDs. Theyalso financed the development of the HarmonizedBid Documents, the planned dissemination of whichwe talk about tomorrow as part of the Harmonizationeffort. We hope to interest the other donors fromthe ADB, and JBIC in the use of these PhilippineHarmonized Bid Documents as well as the draftingof Procurement Side Letters to facilitate the adoptionof common procedures and formats. Lastly, we haveincluded the PWI and the PCA in this Mission toalso contribute their expertise to make Procurementingovernment more transparent and accountable.
While we sometimes like to pat ourselves on theback with the progress made in setting in place thenew Procurement Law in government; disturbingdevelopments like the further downgrade we gotunder the quality of public and institutional worldcompetitiveness study, including that forgovernment procurement and the corruption issuein the military procurement finance management,make us realize that we have a long way to go inachieving the anti-corruption aspects ofprocurement.
The development of a Code of Ethics for CSO BACobservers, training of CSOs and development of theCSO network by PWI, the Round Table Discussionwith 10 CSOs including nationwide groups likeNAMFREL, CBCP TAN, PCA, and COFILCO offersome answers; as well as the meeting with seniorofficials last October 22 which included PAGC andthe Ombudsman. They point to the need to 1)develop an information system for greatertransparency, like the GEPS, 2) develop the InternalAudit Unit in departments to cover the Monitoringof Procurement, 3) strengthening the role of COAin enforcing compliance with the law, 4) furtherstrengthen the Oversight Committee on Procurementand,5) expand the role of CSOs and Media in reform.
We have much to tackle in the next four days andthe Baseline Indicator System developed by theOECD and the WB offers a systematic way ofbenchmarking the country’s procurement reformefforts against established indicators of achievingeconomy, efficiency, transparency, and equalopportunity for bidders. I therefore hope that byFriday, we as a group come to a consensus on howto cooperate and work together to realize more ofthe promise of procurement reform for improvingpublic services, identifying more savings for
Appe
ndix
3 -
Sum
mar
y of
Ach
ieve
men
ts a
nd O
ngoi
ng A
gree
d Ac
tions
com
plet
edon
goin
g
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3
Fun
ding
PU
BLI
C P
RO
CU
RE
ME
NT
BY
NAT
ION
AL
AG
EN
CIE
S, G
over
nmen
t-Ow
ned-
and-
Con
trolle
d C
orpo
ratio
n an
d ot
her I
nstru
men
talit
ies
Stre
ngth
en1.
Pas
sage
and
pro
mul
gatio
n of
an
Dep
artm
ent o
f Bud
get
D
ecem
ber 2
002
Don
e.U
SAID
Lega
l and
Om
nibu
s La
w o
n Pr
ocur
emen
t.an
d M
anag
emen
tTh
e La
w w
as ip
asse
d on
Feb
ruar
yPo
licy
Fram
ewor
k10
, 200
3.
2. P
repa
re im
plem
entin
g ru
les
and
Gov
ernm
ent P
rocu
rem
ent
Don
e.U
SAID
/re
gula
tions
afte
r ena
ctm
ent o
f the
Polic
y Bo
ard
The
Impl
emen
ting
Rul
es a
ndAD
BLa
w a
nd p
repa
ratio
n of
Phi
lippi
nes
Reg
ulat
ions
-A w
as is
sued
Bidd
ing
Doc
umen
ts a
nd F
orm
s.Se
ptem
ber 2
3, 2
003
and
beca
me
effe
ctiv
e O
ctob
er8,
200
3.
3. U
pdat
e G
over
nmen
t Acc
ount
ing
Com
mis
sion
on
Audi
t
Dec
embe
r 200
3D
one.
Audi
t Man
ual t
o in
clud
e th
e ne
wG
over
nmen
t Pro
cure
men
t Ref
orm
Proc
urem
ent L
aw.
Act
circ
ular
ized
as
part
of A
udit
Rul
es.
4. D
evel
op a
trai
ning
pro
gram
for
Com
mis
sion
on
Audi
t
Dec
embe
r 200
3D
one.
audi
tors
on
the
Law,
its
Impl
emen
ting
Trai
ning
pro
gram
on
Law
/R
ules
and
Reg
ulat
ions
and
Pro
cure
men
tIm
plem
entin
g R
ules
and
Bidd
ing
Doc
umen
ts a
nd F
orm
s.R
egul
atio
ns d
evel
oped
; tra
inin
gof
aud
itors
(6 re
gion
s) c
ompl
eted
.C
ontin
uous
trai
ning
is b
eing
cond
ucte
d.
Stre
ngth
en5.
Est
ablis
h th
e G
over
nmen
t Pro
cure
men
tD
epar
tmen
t of B
udge
t
Jun
e 20
03D
one.
WB
-IDF
Org
aniz
atio
n an
dPo
licy
Boar
d.an
d M
anag
emen
tTh
e Bo
ard
was
con
vene
d on
Staf
fing
Febr
uary
4, 2
003
as m
anda
ted
by la
w.
6. C
ondu
ct a
stu
dy o
n th
e sc
ope
of w
ork
Dep
artm
ent o
f Bud
get
Don
e.of
the
Gov
ernm
ent P
rocu
rem
ent P
olic
yan
d M
anag
emen
t/Th
e G
over
nmen
t Pro
cure
men
tBo
ard.
Gov
ernm
ent P
rocu
rem
ent
Polic
y Bo
ard
esta
blis
hed
by th
ePo
licy
Boar
d -T
echn
ical
Law
whi
ch d
efin
es it
s fu
nctio
ns.
Serv
ices
Offi
ce
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
PU
BLI
C P
RO
CU
RE
ME
NT
BY
NAT
ION
AL
AG
EN
CIE
S, G
over
nmen
t-Ow
ned-
and-
Con
trolle
d C
orpo
ratio
n an
d ot
her I
nstru
men
talit
ies
Stre
ngth
en7.
Est
ablis
h a
natio
nal t
rain
ing
prog
ram
Gov
ernm
ent P
rocu
rem
ent
J
une
2004
On-
goin
g.W
B-ID
FO
rgan
izat
ion
for t
he n
ew p
ublic
pro
cure
men
t sys
tem
.Po
licy
Boar
dR
egio
nal t
rain
ings
on
the
Law
(AS
EM
2an
d st
affin
gIn
-dep
th tr
aini
ng n
eeds
to b
e co
nduc
ted.
and
the
Impl
emen
ting
Rul
es a
ndG
rant
);R
egul
atio
ns b
eing
con
duct
ed b
y th
eG
over
nmen
tG
over
nmen
t Pro
cure
men
tto
pur
sue
Polic
y Bo
ard.
Firs
t rou
nd o
f tra
inin
gfu
ndin
g fro
mof
nat
iona
l age
ncie
s co
mpl
eted
;A
DB
intra
inin
g fo
r LG
Us
star
ted.
Tra
inor
’sD
ecem
ber
train
ing
for L
GU
s in
par
tner
ship
with
CPR
MU
Loca
l Gov
ernm
ent A
cade
my
acco
mpl
ishe
d on
Mar
ch 2
004.
GPP
B-TS
O h
as d
evel
oped
the
mod
ules
for
the
publ
ic P
rocu
rem
ent P
ract
ition
er’s
Dev
elop
men
t Pro
gram
in c
oord
inat
ion
with
the
Dev
elop
men
t Aca
dem
y of
the
Phi
lippi
nes
for N
GA
s, L
GU
s, G
OC
Cs
and
SUC
s to
cov
er H
arm
oniz
edBi
ddin
g D
ocum
ents
as
wel
l. Fu
lltra
inin
g to
be
acco
mpl
ishe
d by
Mar
ch20
05.
8. P
rofe
ssio
naliz
e th
e pr
ocur
emen
t fun
ctio
n:G
over
nmen
t Pro
cure
men
t
Dec
embe
r 200
3O
ngoi
ng.
WB
IDF;
Polic
y Bo
ard/
Civ
il Ser
vice
Con
tract
s w
ith d
omes
tic a
ndA
SE
M 2
Gra
nt
Prep
are
a St
udy
Com
mis
sion
inte
rnat
iona
l con
sulta
nts
have
bee
nw
ill co
ver 5
sign
ed b
y Se
cret
ary
Bonc
ondi
n. T
hepi
lot a
genc
ies
Im
plem
enta
tion
(NG
A)Pr
ofes
sion
al R
egul
atio
nsde
adlin
e fo
r the
acc
ompl
ishm
ent o
fC
omm
issi
onth
is a
ctiv
ity is
Apr
il 200
5.
9. S
tudy
to c
orpo
ratiz
e Pr
ocur
emen
tD
epar
tmen
t of B
udge
t and
J
une
2003
Ong
oing
.C
IDA
/WB
-IDF
Serv
ice
as in
depe
nden
t ent
ity.
Man
agem
ent-P
rocu
rem
ent
Con
tract
with
dom
estic
con
sulta
nt h
asSe
rvic
ebe
en s
igne
d by
Sec
reta
ry B
onco
din.
Proc
urem
ent S
ervi
ce is
impl
emen
ting
the
Gov
ernm
ent-E
lect
roni
cPr
ocur
emen
t Sys
tem
and
reen
gine
er-
ing
its s
yste
ms
and
proe
dure
s.C
ompl
etio
n of
the
stud
y by
Feb
ruar
y.20
05.
Impr
ove
Proc
urem
ent
10. E
nfor
ce th
e re
gula
tion
on tr
ansp
aren
cyC
omm
issi
on o
n Au
dit
D
ecem
ber 2
004
On-
goin
g.G
over
nmen
tPr
actic
es a
ndth
roug
h pr
ocur
emen
t aud
it.Tr
aini
ng o
n th
e La
w a
nd th
eto
pur
sue
Proc
esse
sIm
plem
entin
g R
ules
and
fund
ing
from
Reg
ulat
ions
. Tra
inin
ng o
nA
DB
inPr
ocur
emen
t Bid
ding
Doc
umen
tsD
ecem
ber
and
the
Proc
urem
ent M
anua
l will
CPR
MU
be re
quire
d fo
r aud
itors
.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
PU
BLI
C P
RO
CU
RE
ME
NT
BY
NAT
ION
AL
AG
EN
CIE
S, G
over
nmen
t-Ow
ned-
and-
Con
trolle
d C
orpo
ratio
n an
d ot
her I
nstru
men
talit
ies
11. E
nfor
ce p
roce
ssin
g le
ad ti
me
thro
ugh
Com
mis
sion
on
Audi
t
Jun
e 20
04D
one.
IFIs
will
appl
icat
ion
of s
anct
ions
and
mon
itorin
gSe
ctio
n 38
of t
he L
aw m
anda
tes
cond
uct
thro
ugh
proc
urem
ent a
udit
(Adm
inis
trativ
ele
adtim
e fo
r key
ste
ps. C
omm
issi
onbr
ief i
ng w
ithO
rder
129
).Au
dit P
roce
dure
.C
omm
issi
onon
Aud
itau
dito
rsle
adtim
es fo
rFo
reig
n-As
sist
edPr
ojec
tsPr
ocur
emen
t
12. T
he Im
plem
entin
g R
ules
and
Dep
artm
ent o
f Bud
get
June
200
3D
one.
Reg
ulat
ions
of t
he la
w s
houl
d pr
ohib
itan
d M
anag
emen
t-Pro
cure
men
tTh
e La
w d
oes
not a
llow
for
nego
tiatio
n of
pric
e an
d co
ntra
ct a
mou
ntSe
rvic
esne
gotia
tion
of p
rice
and
cont
ract
(goo
ds a
nd w
orks
) afte
r bid
ope
ning
(IR
R).
amou
nt.
13. D
evel
op a
fram
ewor
k an
d gu
idel
ines
Dep
artm
ent o
f Int
erio
r and
D
ecem
ber 2
002
Don
e.AS
EM G
rant
for C
ongr
essi
onal
inse
rtion
s an
dLo
cal G
over
nmen
t/Dep
artm
ent
Stud
y an
d fra
mew
ork
subm
itted
by
Con
stitu
ency
Dev
elop
men
t Fun
d.of
Bud
get a
nd M
anag
emen
t/co
nsul
tant
s. N
eeds
follo
w-u
pLe
ague
of C
ities
activ
ities
to e
xplo
re p
ossi
bilit
y
Term
s of
Ref
eren
ce p
repa
red
of e
nhan
cing
aud
it by
the
and
subm
itted
by
Dep
artm
ent
Com
mis
sion
on
Audi
t and
of In
terio
r and
Loc
al G
over
nmen
tm
onito
ring
by th
e Pr
ocur
emen
tW
atch
, Inc
./Gov
ernm
ent-w
atch
/Ph
ilippi
ne C
ente
r for
Inve
stig
ativ
eJo
urna
lism
/oth
er N
GO
s.
14. P
rice
mon
itorin
g to
be
incl
uded
as
anG
over
nmen
t Pro
cure
men
t
Jun
e 20
03O
ngoi
ng.
impo
rtant
func
tion
of O
vers
ight
Boa
rd (I
RR
).Po
licy
Boar
d-Te
chni
cal S
ervi
ces
PS re
gula
rly m
onito
rs c
omm
only
-O
ffice
/Pro
cure
men
t Ser
vice
used
sup
plie
s. T
he G
-EPS
will
have
apr
ice
mon
itorin
g fe
atur
e fo
r non
com
mon
-use
sup
plie
s; to
be
com
plet
ed b
y M
arch
200
5.
15. T
he C
ivil S
ervi
ce C
omm
issi
on o
r the
Dep
artm
ent o
f Bud
get a
nd
Jun
e 20
03D
one.
Offi
ce o
f the
Sol
icito
r Gen
eral
to p
rovi
deM
anag
emen
tTh
e La
w p
rovi
des
for l
egal
supp
ort t
o m
embe
rs o
f the
Bid
and
assi
stan
ce a
nd in
dem
nific
atio
n of
Awar
ds C
omm
ittee
/Pro
cure
men
t Eva
luat
ion
Bids
and
Aw
ards
Com
mitt
eean
d Aw
ards
Com
mitt
ee s
ubje
cted
tom
embe
rs.
hara
ssm
ent.
16. D
evel
op o
n de
man
d sa
tisfa
ctor
yW
orld
Ban
k
Dec
embe
r 200
3D
one.
secu
ritie
s to
be
issu
ed b
y no
n-ba
nkin
gAr
ticle
XXI
of R
.A. 9
184
prov
ides
for
inst
itutio
ns. I
mpr
ove
pena
litie
s in
lieu
of b
idfo
r pen
al s
anct
ions
. The
Sec
uriti
esse
curit
y fo
r sm
all c
ontra
cts.
Rep
ort c
ompl
eted
on
June
200
4.
PU
BLI
C P
RO
CU
RE
ME
NT
BY
NAT
ION
AL
AG
EN
CIE
S, G
over
nmen
t-Ow
ned-
and-
Con
trolle
d C
orpo
ratio
n an
d ot
her I
nstru
men
talit
ies
17. R
epla
ce s
uret
y bo
nd w
ith B
ank
Gov
ernm
ent P
rocu
rem
ent
J
une
2003
Don
e.gu
aran
tee/
Lete
rs o
f Cre
dit/o
ther
form
s.Po
licy
Boar
dTh
e Im
plem
entin
g R
ules
and
Reg
ulat
ions
spe
cify
opt
ions
.
Enha
nce
18. P
ush
for 6
0% im
plem
enta
tion
by a
llD
epar
tmen
t of B
udge
t and
D
ecem
ber 2
003
Ong
oing
.Tr
ansp
aren
cyag
enci
es o
f Gov
ernm
ent E
lect
roni
cM
anag
emen
t/Pro
cure
men
tA
s of
Aug
ust 3
1, 2
004,
77%
for
Proc
urem
ent S
yste
ms.
Serv
ices
Nat
iona
l Gov
ernm
ent A
genc
ies:
38%
for G
over
nmen
t-Ow
ned
and
Con
trolle
d C
orpo
ratio
ns w
ith a
llG
OC
Cs
in N
CR
(hea
d of
fices
regi
ster
ed):
92%
of S
tate
Uni
vers
ities
and
Col
lege
s: a
nd a
llci
ties,
68%
of p
rovi
nces
, 22%
of
mun
icip
aliti
es a
nd 9
bar
anga
ysw
ere
regi
ster
ed. T
o be
com
plet
edin
acc
orda
nce
with
the
Impl
emen
ting
Rul
es a
nd R
egul
atio
ns. T
heG
over
nmen
t Pro
cure
men
t Pol
icy
Boar
d to
mon
itor a
nd re
port
onco
mpl
ianc
e qu
arte
rly.
19. E
ncou
rage
gui
delin
es a
nd tr
aini
ng o
fPr
ocur
emen
t Wat
ch, I
nc./
D
ecem
ber 2
002
Ong
oing
.In
itial
fund
ing
civi
l soc
iety
’s p
artic
ipat
ion
in p
rocu
rem
ent
Tran
spar
ency
Inte
rnat
iona
l Phi
ls.
Proc
urem
ent W
atch
, Inc
.,is
bei
ngby
ASE
Mat
all l
evel
s.in
vite
d to
obs
erve
pro
cure
men
tpr
oces
ses
in a
t lea
st tw
enty
-five
(25)
agen
cies
in th
e N
CR
. Hig
h de
man
dre
quire
s ad
ditio
nal s
taff
and
train
ing
with
wor
ksho
ps (f
unds
). To
be
com
plet
ed b
y D
ecem
ber 2
004.
20. D
evel
op g
uide
lines
and
trai
ning
of
Proc
urem
ent W
atch
, Inc
./
Dec
embe
r 200
2D
one.
WB
-IDF
Nat
iona
l Gov
ernm
ent O
rgan
izat
ions
and
Tran
spar
ency
Inte
rnat
iona
l Phi
ls.
As o
f Aut
ust 3
1, 2
004,
Pro
cure
men
tC
ivil S
ocie
ty.
Wat
ch, I
nc. d
evel
oped
a B
ACO
bser
ver C
ode
of E
thic
s, a
trai
ning
pack
age
for C
ivil S
ocie
ty O
rgan
iza-
tions
and
Pro
fess
iona
l Ass
ocia
tions
,as
wel
l as
a pu
blic
bid
ding
che
cklis
t.Pr
ocur
emen
t Wat
ch, I
nc. t
rain
ed 3
4C
ivil S
ocie
ty O
rgan
izat
ions
nat
ion-
wid
e, w
ith 1
8 si
gnin
g a
MO
A w
ith it
for p
urpo
ses
of o
bser
ving
pub
licbi
ddin
g. P
rocu
rem
ent W
atch
, Inc
.,al
so d
evel
oped
a w
eb-b
ased
cen
tral
repo
rting
/info
rmat
ion
shar
ing
and
diss
emin
atio
n sy
stem
for M
OA
partn
ers.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
LOC
AL
GO
VE
RN
ME
NT
UN
IT P
RO
CU
RE
ME
NT
Publ
ic21
. Ens
ure
that
Loc
al G
over
nmen
t Uni
ts’
D
ecem
ber 2
002
Don
e.Pr
ocur
emen
tpr
ocur
emen
t is
adeq
uate
ly c
over
ed in
prop
osed
Pro
cure
men
t Bill.
22. L
ocal
Gov
ernm
ent U
nits
’ con
cern
s/D
epar
tmen
t of I
nter
ior a
nd
Dec
embe
r 200
2D
one.
view
s w
ill be
repr
esen
ted
in th
e fo
rmul
atio
nLo
cal G
over
nmen
t/Lea
gue
ofof
the
Impl
emen
ting
Rul
es a
nd R
egul
atio
nsC
ities
once
the
Bill i
s en
acte
d.
23. L
ocal
Chi
ef E
xecu
tives
sho
uld
not
Dep
artm
ent o
f Bud
get a
nd
Dec
embe
r 200
2D
one.
chai
r the
Bid
ding
and
Aw
ards
Com
mitt
ees.
Man
agem
ent
The
Law
pro
hibi
ts a
ppro
ving
auth
ority
to b
e ch
air o
f the
Bid
san
d Aw
ards
Com
mitt
ee.
24. M
ake
the
impl
emen
tatio
n of
Ann
ual
Dep
artm
ent o
f Bud
get a
nd
Jun
e 20
03D
one.
Proc
urem
ent P
lan
by th
e Lo
cal
Man
agem
ent C
ircul
arSe
ctio
n 7
of th
e La
w re
quire
sG
over
nmen
t Uni
ts m
anda
tory
.An
nual
Pro
cure
men
t Pla
n lin
ked
to B
udge
t.
25. P
rofe
ssio
naliz
e th
e pr
ocur
emen
tG
over
nmen
t Pro
cure
men
t
Dec
embe
r 200
3O
ngio
ng.
WB
-IDF
func
tion
and
build
Loc
al G
over
nmen
t Uni
ts-
Polic
y Bo
ard/
Dep
artm
ent o
fTh
is is
par
t of t
he P
rofe
ssio
naliz
atio
nle
vel p
rocu
rem
ent c
apac
ity.
Inte
rior a
nd L
ocal
Gov
ernm
ent
Stud
y in
Act
ivity
No.
8; t
o be
com
plet
ed in
Mar
ch 2
005.
Dev
elop
a S
tudy
Im
plem
enta
tion
26. R
atio
naliz
e m
etho
d of
pro
cure
men
t and
Dep
artm
ent o
f Bud
get a
nd
60
days
from
Don
e.ex
pedi
te p
aym
ent t
o co
ntra
ctor
s an
dM
anag
emen
t/Gov
ernm
ent/
a
ppro
val o
f New
Rul
es o
n al
tern
ativ
e m
etho
ds o
fsu
pplie
rs (t
o be
dea
lt w
ith in
the
Impl
emen
ting
Proc
urem
ent P
olic
y Bo
ard
P
rocu
rem
ent L
awpr
ocur
emen
t pro
vide
d in
Sec
tion
Rul
es a
nd R
egul
atio
ns).
48 o
f Im
plem
entin
g R
ules
and
Reg
ulat
ions
.
Upd
ate
the
Gov
ernm
ent
Com
mis
sion
on
Audi
t
Dec
embe
r 200
3G
over
nmen
t Pro
cure
men
t Ref
orm
Acco
untin
g an
d Au
dit M
anua
lAc
t and
Impl
emen
ting
Rul
es a
ndR
egul
atio
ns c
ircul
ariz
ed a
sAu
dit R
ules
.
Dev
elop
and
impl
emen
t tra
inin
gC
omm
issi
on o
n Au
dit
J
une
2003
Ong
oing
; to
be c
ompl
eted
by
prog
ram
on
proc
urem
ent a
udit
Dec
embe
r 200
4.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
LOC
AL
GO
VE
RN
ME
NT
UN
IT P
RO
CU
RE
ME
NT
27. D
evel
op a
goo
d re
cord
kee
ping
sys
tem
Gov
ernm
ent P
rocu
rem
ent
for:
Polic
y Bo
ard/
Dep
artm
ent o
fPu
blic
Wor
ks a
nd H
ighw
ays/
Pr
ovin
ces/
citie
s (p
ilot p
hase
)D
epar
tmen
t of I
nter
ior a
nd
Dec
embe
r 200
4To
be
com
plet
ed b
y D
ecem
ber 2
004.
Loca
l Gov
ernm
ent
M
unic
ipal
ities
(ful
l impl
emen
tatio
n)
Dec
embe
r 200
4To
be
com
plet
ed b
y D
ecem
ber 2
004.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
PU
BLI
C W
OR
KS
SE
CTO
R
Polic
ies
and
28. F
orei
gn c
ontra
ctor
s sh
ould
be
allo
wed
DP
WH
/CIA
P
J
une
2003
The
Con
tract
ors
Lice
nsin
g La
wPr
oced
ures
to b
id w
ithou
t PC
AB lic
ense
but
will
need
proh
ibits
this
. How
ever
, the
pro
cess
to p
rese
nt th
e lic
ense
prio
r to
awar
d.is
bei
ng s
tream
lined
. Fu
rther
elab
orat
ion
requ
ired
to fa
cilit
ate
parti
cipa
tion
of b
idde
rs.
Lega
l29
. Rev
iew
the
law
on
arbi
tratio
n to
CIA
P/D
PW
H
J
une
2003
Enha
ncem
ent o
f exi
stin
g La
wFr
amew
ork
alig
n it
with
inte
rnat
iona
l pra
ctic
e.ba
sed
on U
NC
ITR
AL m
odel
isbe
ing
cons
ider
ed. T
his
requ
ires
in-d
epth
stu
dy. N
eeds
tech
nica
las
sist
ance
for t
he s
tudy
.
Impr
ove
30. S
tudy
on
regi
stra
tion
and
licen
sing
GP
PB
/DP
WH
/CIA
P-P
DC
B
Ju
ne 2
003
To b
e co
mpl
eted
. N
eeds
Proc
urem
ent
of c
ontra
ctor
s; d
esig
n an
d im
plem
ent a
nas
sist
ance
to s
tream
line.
Prac
tices
and
actio
n pl
an to
stre
amlin
e pr
oces
ses
for
Proc
esse
sre
gist
ratio
n an
d lic
ensi
ng o
f con
tract
ors.
Eval
uatio
n of
31. A
dopt
the
stan
dard
pas
s or
fail c
riter
iaD
PW
H/A
DB
June
200
3D
one.
Bid
Aw
ards
for a
ll pro
cure
men
t exc
ept p
re-q
ualif
icat
ion
of A
DB-
fund
ed p
roje
cts
whi
ch w
ill al
so b
esc
hedu
led
to a
dopt
pas
s or
fail c
riter
ia in
2002
.
- do
-32
. Sta
ndar
d es
timat
ed c
ost p
er c
lass
room
,D
PW
H
Ju
ne 2
003
Don
e.fo
r bud
geta
ry p
urpo
ses,
sho
uld
not b
e a
limita
tion
to th
e re
sulti
ng b
id p
rice.
Del
iver
y,33
. Pro
vide
/stre
ngth
en q
ualit
y as
sura
nce
DP
WH
June
200
4O
ngoi
ng.
Insp
ectio
n,m
echa
nism
for d
esig
n an
d su
perv
isio
n.D
PWH
has
an
upda
ted
and
Paym
ent
stre
ngth
ened
5-y
ear Q
ualit
yAs
sura
nce
Prog
ram
, whi
ch in
volv
esof
add
ition
al Q
ualit
y As
sura
nce
Uni
ts
Enha
nce
Tran
spar
ency
34. U
se o
f com
pute
rized
regi
stry
by
all
DP
WH
D
ecem
ber 2
004
Ong
oing
.pr
ojec
ts fo
llow
ing
prog
ress
of
Pilo
t tes
t on
two
WB-
fund
edof
com
pute
rizat
ion.
proj
ects
und
er im
plem
enta
tion,
and
succ
essf
ul. T
rain
ing
prog
ram
for
on th
e us
e of
ele
ctro
nic
regi
stry
for
roll o
ut to
the
regi
ons
has
been
deve
lope
d an
d w
ill be
impl
emen
ted
by D
ecem
ber 2
004
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
ED
UC
ATI
ON
SE
CTO
R
Lega
l Fra
mew
ork
35. R
evis
e Se
ctio
n 1-
A, R
ule
IV o
fD
epED
Dec
embe
r 200
3D
one.
and
Polic
yR
A 80
47 a
nd G
ener
al P
olic
y N
o. 5
of
the
Nat
iona
l Boo
k Po
licy
to re
lax
itsre
quire
men
ts o
n im
porta
tion
of ra
wm
ater
ials
for t
extb
ooks
.
- do
-36
. Am
endm
ent o
f the
law
to a
llow
Dep
ED
Dec
embe
r 200
4Be
caus
e of
the
new
cur
ricul
um,
text
book
s of
fore
ign
auth
ors
to c
ompe
teth
is a
ctiv
ity n
eeds
to b
e pu
rsue
d.lo
cally
for S
cien
ce, M
ath
and
Engl
ish
text
book
s.
- do
-37
. Stre
amlin
e th
e po
licy
on te
xtbo
okD
epED
Don
e.co
nten
t eva
luat
ion.
Furth
er im
prov
emen
ts w
ithth
e ne
w te
xtbo
ok p
olic
y (E
nglis
h,M
ath
and
Scie
nce)
.
Org
aniz
atio
n38
. Tra
inin
g an
d em
pow
erm
ent o
f the
bid
DO
H/S
EMP2
/All A
genc
ies
Dec
embe
r 20
03D
one.
com
mitt
ee m
embe
rs (p
roffe
ssio
naliz
atio
n).
BAC
mem
bers
to A
IMpr
ocur
emen
t tra
inin
g.
Plan
ning
and
39. D
evel
op a
n ef
fect
ive
proc
urem
ent
Dep
ED
Ju
ne 2
003
On-
goin
g w
ith im
plem
enta
tion
ofM
onito
ring
plan
ning
and
inve
ntor
y m
onito
ring
syst
emsy
stem
at a
ll lev
els
(exc
ept s
choo
l)at
the
Reg
iona
l, D
ivis
ion,
Dis
trict
and
Sch
ool
to b
e co
mpl
eted
in D
ecem
ber 2
004.
Leve
ls.
Proc
urem
ent p
roce
ss a
t “sc
hool
”le
vel is
“ope
n”. N
atio
nwid
e Tr
aini
ngse
min
ar fo
r sup
ply
offie
rs a
t the
Reg
iona
l and
Div
isio
n le
vels
is b
eing
unde
rtake
n.
Cap
acity
Bui
ldin
g40
. Stre
ngth
en D
epEd
’s p
rocu
rem
ent
Dep
ED
Ju
ne 2
003
Ong
iong
.ca
paci
ty.
Nat
ionw
ide
train
ing
sem
inar
for
supp
ly o
ffice
rs a
t the
Reg
iona
l and
and
Div
isio
n le
vels
is b
eing
unde
rtake
n. P
rocu
rem
ent S
ervi
ceun
it es
tabl
ishe
d on
Dec
embe
r 200
3,bu
t stil
l nee
ds to
be
fully
sta
ffed.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Stat
us a
s of
Oct
ober
31,
200
3Fu
ndin
g
HE
ALT
H S
EC
TOR
Org
aniz
atio
n41
. Rev
iew
and
impl
emen
t Dep
artm
ent o
fD
epar
tmen
t of H
ealth
Dec
embe
r 200
3O
ngoi
ng.
Hea
lth re
form
s in
term
s of
dec
entra
lizat
ion
of p
rocu
rem
ent.
Adve
rtise
men
t42
. Dev
elop
a m
echa
nism
to e
nsur
e w
ider
Dep
artm
ent o
f Hea
lth/S
ocia
l
D
ecem
ber 2
003
Don
e.pa
rtici
patio
n an
d co
mpe
titio
nEx
pend
iture
and
Man
agem
ent
Reg
istra
tion
inst
ead
of a
ccre
dida
tion
Proj
ect 2
and
wid
er n
otifi
catio
n.
Cap
acity
Bui
ldin
g43
. Stre
ngth
en B
urea
u of
Foo
d an
d D
rug’
sD
epar
tmen
t of H
ealth
June
200
3D
one.
capa
city
to s
horte
n th
e re
gist
ratio
n pr
oces
s.In
stea
d of
up
to 6
mon
ths,
now
2-3
wee
ks.
- do
-44
. Tra
inin
g an
d em
pow
erm
ent o
f the
bid
Dep
artm
ent o
f Hea
lth/S
ocia
l
D
ecem
ber 2
003
Don
e.co
mm
ittee
mem
bers
(pro
fess
iona
lizat
ion)
.Ex
pend
iture
and
Man
agem
ent
Staf
f sen
t to
AIM
trai
ning
.Pr
ojec
t 2/A
ll Age
ncie
s
Proc
edur
es a
nd45
. Stre
amlin
e th
e pr
oced
ure
for c
ontra
ctD
epar
tmen
t of H
ealth
/Soc
ial
Dec
embe
r 200
3D
one.
Prac
tices
revi
ew b
y Le
gal S
ervi
ces
Div
isio
n.Ex
pend
iture
and
Man
agem
ent
One
wee
k in
stea
d of
one
mon
th.
Proj
ect 2
- do
-46
. Stre
amlin
e th
e ca
sh a
lloca
tion
proc
ess
Dep
artm
ent o
f Hea
lth/S
ocia
l
D
ecem
ber 2
003
Don
e.an
d ap
prov
al p
roce
ss to
avo
id d
elay
.Ex
pend
iture
Man
agem
ent
Proj
ect 2
Mon
itorin
g47
. Dev
elop
a m
ecah
nism
to m
onito
r and
Dep
artm
ent o
f Hea
lth/S
ocia
l
Jun
e 20
03D
one
for s
uppl
iers
; for
eval
uate
the
perfo
rman
ce o
f the
sup
plie
rs, a
ndEx
pend
iture
Man
agem
ent
cons
truct
ors/
cons
ulta
nts
still
cons
truct
ors/
cons
ulta
nts.
Proj
ect 2
unde
r pre
para
tion.
Org
aniz
atio
n an
d48
. Rev
iew
the
staf
fing
of P
rocu
rem
ent
Dep
artm
ent o
f Hea
lth/S
ocia
l
D
ecem
ber 2
002
Don
e Au
gust
200
2.St
affin
gan
d Lo
gist
ics
Serv
ice.
Expe
nditu
re M
anag
emen
tPr
ojec
t 2
Syst
ems
and
49. E
stab
lish
a N
atio
nal D
rug
Pric
eD
epar
tmen
t of H
ealth
/Soc
ial
J
une
2003
Don
e N
ovem
ber 2
002.
Proc
edur
esM
onito
ring
Syst
em.
Expe
nditu
re M
anag
emen
tPr
ojec
t 2
- do
-50
. Con
duct
a s
tudy
on
pric
e of
Dep
artm
ent o
f Hea
lth/S
ocia
l
D
ecem
ber 2
003
Don
e Au
gust
200
3.ph
arm
aceu
tical
s.Ex
pend
iture
Man
agem
ent
Proj
ect 2
Emer
ging
Issu
es/P
riorit
ies
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Sta
tus
as o
f Aug
ust 3
1, 2
004
Pro
pose
d
F
undi
ng
Stre
ngth
en1.
Pre
pare
impl
emen
tatio
n pl
an fo
r Mon
itorin
gG
over
nmen
t Pro
cure
men
t
Jun
e 20
04O
ngio
ng.
WB
-IDF/
Org
aniz
atio
nal
and
Eval
uatio
n ca
pabi
lity
of th
ePo
licy
Boar
dTh
e G
PP
B-T
SO
has
a to
ol to
ASEM
2C
apac
ityG
over
nmen
t Pro
cure
men
t Pol
icy
Boar
d-ev
alua
te a
genc
ies’
com
plia
nce
Tech
nica
l Ser
vice
s O
ffice
with
resp
ect t
ow
ith th
e G
over
nmen
t Pro
cure
men
ten
forc
emen
t of t
he G
over
nmen
tR
efor
m A
ct, a
s w
ell a
s ef
fect
ivity
Proc
urem
ent R
efor
m A
ct/Im
plem
entin
gof
the
Law,
kno
wn
as th
eR
ules
and
Reg
ulat
ions
.Pr
ocur
emen
t Ref
orm
Impa
ctM
onth
ly E
valu
atio
n R
epor
t. An
onlin
e m
onito
ring/
surv
ey s
yste
mw
ill be
dev
elop
ed b
y N
ovem
ber
2004
.
2. D
isse
min
ate
info
rmat
ion
on G
over
nmen
tG
over
nmen
t Pro
cure
men
t
M
arch
200
4D
one.
WB
-IDF;
Proc
urem
ent R
efor
m A
ct/Im
plem
entin
gPo
licy
Boar
d/D
epar
tmen
t of
Upo
n th
e re
ques
t of t
he G
PPB
Gov
ernm
ent
Rul
es a
nd R
egul
atio
ns to
Loc
alIn
terio
r and
Loc
al G
over
nmen
tD
ILG
issu
ed a
circ
uall t
o in
form
to p
ursu
eal
l LG
Us
of th
e G
over
nmen
tad
ditio
nal
Proc
urem
ent R
efor
m A
ct a
nd it
sfu
ndin
g fro
mIR
R-A
.AD
B
3. I
mpl
emen
t E-P
rocu
rem
ent a
s a
Gov
ernm
ent P
rocu
rem
ent
D
ecem
ber 2
004
G-E
PS c
ontra
cdt w
ith p
rivat
eG
over
nmen
t ttra
nsac
tiona
l tool
.Po
licy
Boar
d/Pr
ocur
emen
tse
rvic
e pr
ovid
er w
as s
igne
d on
to p
ursu
eSe
rvic
eAp
ril 6
, 200
4 an
d N
otic
e to
fund
ing
with
Proc
eed
was
issu
ed o
n Ap
ril 1
3,AD
B20
04. F
ull im
plem
enta
tion
ofP
hase
I of
the
G-E
PS
Pro
ject
will
be b
y M
any
26, 2
0005
; Pha
ses
II,III
, IV,
and
V w
ill be
dev
elop
edfro
m S
epte
mbe
r 1 to
Sep
tem
ber
15, 2
005.
4. T
rain
ing
Gov
ernm
ent E
-Pro
cure
men
tC
omm
issi
on o
n Au
dit/
D
ecem
ber 2
004
syst
ems
staf
f and
Com
mis
sion
on
Audi
tPr
ocur
emen
t Ser
vice
audi
tors
in th
e ar
ea o
f sys
tem
sec
urity
.
Impr
ove
5. P
repa
re a
repo
rt on
cap
acity
, qua
lity
and
Inte
rnat
iona
l Fin
anci
ng
Mar
ch 2
004
Don
e.W
BPr
ocur
emen
tsi
ze o
f con
tract
s fo
r wor
ks u
nder
For
eign
Inst
itutio
nsR
epor
t of c
onsu
ltant
s di
scus
sed
Prac
tices
and
Assi
sted
Pro
ject
s, in
clud
ing
the
mix
of
durin
g th
e C
PAR
Sec
ond
Upd
ate
Proc
esse
sna
tiona
l and
fore
ign
fund
ing.
Mis
sion
. Rec
omm
enda
tions
are
bein
g ac
ted
upon
.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
Sta
tus
as o
f Aug
ust 3
1, 2
004
Pro
pose
d
F
undi
ng
6. T
rain
ing
on H
arm
oniz
ed B
iddi
ngG
over
nmen
t Pro
cure
men
t
Dec
embe
r 200
4O
ngoi
ng.
WB
-IDF/
Doc
umen
ts a
t all l
evel
s in
clud
ing
natio
nal
Polic
y Bo
ard
GPP
B-TS
O h
as d
evel
oped
the
AS
EM
2ag
enci
es, l
ocal
gov
ernm
ent,
priv
ate
sect
orth
e m
odul
es fo
r the
Pub
lican
d ci
vil s
ocie
ty.
Proc
urem
ent P
ract
ione
r’sD
evel
opm
ent P
rogr
am in
coor
dina
tion
with
the
Dev
elop
men
t Aca
dem
y of
the
Phi
lippi
nes
for N
GA
s, L
GU
s,G
OC
Cs,
and
SU
Cs
to c
over
Har
mon
ized
Bid
ding
Doc
umen
tsas
wel
l. Fu
ll tra
inin
g to
be
acco
mpl
ishe
d by
Mar
ch 2
005.
7. P
repa
re a
repo
rt on
bid
pric
es/v
aria
tion
Gov
ernm
ent P
rocu
rem
ent
S
epte
mbe
r 200
4D
one.
Gov
ernm
ent
orde
rs re
lativ
e to
Eng
inee
r’s E
stim
ates
inPo
licy
Boar
d/D
epar
tmen
t of
The
repo
r of t
he c
onsu
ltant
slw
ill re
ques
proj
ects
with
and
with
out f
ixed
bud
get
Publ
ic W
orks
and
Hig
hway
s/w
as d
iscu
ssed
dur
ing
the
CPA
RJa
pan
Bank
for
ceilin
gs.
Com
mis
sion
on
Audi
tSe
cond
Upd
ate
Mis
sion
.In
tern
atio
nal
Rec
omm
enda
tions
wer
eC
oope
ratio
nco
nsid
ere.
8. P
ilot t
estin
g of
the
Proc
urem
ent M
anua
lG
over
nmen
t Pro
cure
men
t
Sep
tem
ber 2
004
Ong
oing
.A
SE
M 2
in a
t lea
st n
ine
(9) a
genc
ies/
Loca
l Gov
ernm
ent
Polic
y Bo
ard/
All A
genc
ies/
Term
s of
Ref
eren
ce s
till t
o be
Gra
ntU
nits
.Lo
cal G
over
nmen
t Uni
tsfin
aliz
ed. M
anua
ls s
till t
o be
revie
wed
.
9. D
ownl
oadi
ng o
f bid
ding
doc
umen
tsG
over
nmen
t Pro
cure
men
t
D
ecem
ber 2
004
Don
e.fro
m th
e Pr
ocur
emen
t Ser
vice
s or
Polic
y Bo
ard/
Dep
artm
ent o
fG
-EPS
has
full c
apab
ility
agen
cy w
ebsi
te.
Hea
lth o
r Dep
artm
ent o
f Pub
licto
allo
w d
ownl
oadi
ng o
fW
orks
and
Hig
hway
sbi
ddin
g do
cum
ents
.
10. I
mpr
ovem
ent o
f ski
lls in
est
imat
ing
Gov
erm
ent P
rocu
rem
ent
Sept
embe
r 200
4O
ngio
ng.
WB
-IDF
pric
es a
nd a
naly
zing
bid
var
ianc
es.
Polic
y Bo
ard/
Dep
artm
ent o
fTe
rms
of R
efer
ence
hav
e be
enPu
blic
Wor
ks a
nd H
ighw
ays
draf
ted
11. I
nclu
de p
rocu
rem
ent m
etho
d fo
r sm
all
Gov
ernm
ent P
rocu
rem
ent
June
200
4D
one.
wor
ks in
the
Impl
emen
ting
Rul
es a
ndPo
licy
Boar
dG
uide
lines
for I
mpl
emen
tatio
nR
egul
atio
ns o
r pro
cure
men
t man
ual.
of P
roje
cts
by A
dmin
istra
tion
appr
oved
by
Res
olut
ion
No.
12. I
ntro
duce
a s
yste
m o
f val
ueG
over
nmen
t Pro
cure
men
t
Ju
ne 2
004
Don
e.W
B w
illen
gine
erin
g an
alys
is o
n a
pilo
t bas
is, t
oPo
licy
Boar
d/D
epar
tmen
t of
Initi
al in
trodu
ctio
n of
the
prov
ide
fund
ing
chec
k th
at d
esig
ns a
nd c
ost e
stim
ates
Publ
ic W
orks
and
Hig
hway
sco
ncep
t of v
alue
eng
inee
ring
for t
rain
eren
sure
bes
t val
ue fo
r mon
ey. B
egin
with
by a
fore
ign
expe
rt w
asth
ree
sele
cted
pro
ject
s an
d in
vite
fore
ign
cond
ucte
d on
Jun
e 14
, 15
expe
rts to
sha
re in
tern
atio
nal e
xper
ienc
e.an
d 18
, 200
4 at
the
Wor
ld B
ank.
The
GP
PB
and
DP
WH
will
stil
lha
ve to
und
erta
ke th
e pi
lot p
roje
ct.
13. P
ilot “
desi
gn a
nd b
uild
” pro
cure
men
tG
over
nmen
t Pro
cure
men
t
Ju
ne 2
004
Don
e.sc
hem
es in
at l
east
one
con
tract
.Po
licy
Boar
d/D
epar
tmen
t of
A nu
mbe
r of w
ater
sup
ply
and
was
tePu
blic
Wor
ks a
nd H
ighw
ays
man
agem
ent p
roje
cts
are
unde
rD
esig
n an
d Bu
ild p
rocu
rem
ent.
Enha
nce
Tran
spar
ency
14. C
apac
ity b
uild
ing
of C
ivil S
ocie
tyG
over
nmen
t Pro
cure
men
t
Ju
ne 2
005
Ong
oing
.A
SE
M 2
Gra
ntO
rgan
izat
ions
as
Gov
ernm
ent’s
Polic
y Bo
ard
This
will
be d
one
with
the
new
lypa
rtner
s an
d Bi
d an
d Aw
ards
crea
ted
Allia
nce
of C
SO
s w
ith P
WI
Com
mitt
ee o
bser
vers
.as
the
Secr
etar
iat.
15. D
efin
e th
e qu
alifi
catio
n cr
iteria
toG
over
nmen
t Pro
cure
men
t
Ju
ne 2
004
Don
e in
the
bidd
ing
docu
men
tsm
atch
bid
ding
requ
irem
ents
in th
ePo
licy
Boar
d/D
epar
tmen
t of
for w
orks
har
mon
ized
with
AD
B,pr
ocur
emen
t man
ual.
Publ
ic W
orks
and
Hig
hway
sJB
IC a
nd W
B.
16. C
olle
ct a
nd d
isse
min
ate
data
on
actu
alG
over
nmen
t Pro
cure
men
t
Ju
ne 2
004
Ong
oing
.bi
d pr
ices
of c
omm
on p
rocu
rem
ent i
tem
s,Po
licy
Boar
d/C
omm
issi
on o
nG
-EP
S is
mon
itorin
g bi
d pr
ices
of
e.g.
cla
ssro
oms,
road
s, m
edic
al s
uppl
ies,
Audi
t/Pro
cure
men
t Wat
ch,
com
mon
ly u
sed
item
s. A
sta
ndal
one
wat
er s
uppl
y, a
nd b
ooks
pro
cure
d by
diff
eren
tIn
corp
orat
edst
udy
will
be d
one
for s
elec
ted
item
s.
Key
Are
aA
ctiv
ity a
nd A
gree
d A
ctio
nR
espo
nsib
le A
genc
yTi
met
able
St a
tus
as o
f Aug
ust 3
1, 2
004
Pro
pos e
d
F
undi
ng
37COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Appendix 4 - Status of Procurement Training and G-EPS Update
Agencies
National GovernmentAgencies (NGAs) Main/Regional Offices Bureaus Attached Agencies
Local GovernmentUnits (LGUs)(excluding barangays) Provinces Cities Municipalities
Government-Owned orControlledCorporations (GOCCs)and other GovernmentCorporate Entities(GCEs) Chartered GOCCs Non-Chartered GCEs GOCCs by Judicial Decisions
State Universities andColleges (SUCs) SUCs in NCR SUCs in other regions Other attached SUCs
TOTAL
No. of Existing Agencies
7391
435 145 159
1,6922
79 119 1,494
7233
76 57 590
1124
8 102 2
3,266
No. of Trained Agencies
549
404 48 97
1,228
66 91 1,071
167
61 14 92
112
8 102 2
2,056
Percentage ofAgencies Trained
62.32%
92.87% 33.10% 61%
77.23 %
83.54% 76.47% 71.68%
40.14 %
80.26% 24.56% 15.6%
100%
100% 100% 100%
70%
Status of Procurement Training on Procurement Laws, Rules and Regulations (October2002 – December, 2004)
1 Source: Department of Budget and Management (DBM) Directory, Organization and Productivity Information Bureau (OPIB) –DBM, Agencies’ Main Offices, Agencies’ Website2 Source: Department of Interior and Local Government3 Source: Department of Finance4 Status Report on G-EPS (2001-December 2004)
Status Report on G-EPS (2001-December 2004)5
5 Source: Office of Philippine Government Electronic Procurement System (PhilGEPS)
Total
3,558
2,993
75,842
3,531
10,529
Agency
No. of Agencies Registeredw/G-EPS
No. of Agencies Trained onG-EPS
No. of Notices Posted
No. of Agencies who Postedon G-EPS
No. of Awards Posted
Total
3,186
11,176
6,734
16,536
59,064
Supplier
No. of SuppliersTrained
No. of RegisteredSuppliers
No. of Suppliers thatDownloaded Notices
No. of Notices Downloaded bySuppliers
No. of Downloaded Noticesby Suppliers
0
200
400
600
800
1000
1200
4th Qtr. 2002 2003 2004
Agencies
05000
1000015000200002500030000350004000045000
2001 2002 2003 2004
AGENCY
No. of Agencies Registered w/G-EPSNo. of Agencies Trained on G-EPSNo. of Notices Posted
No. of Agency who Posted on G-EPSNo. of Awards Posted
0
5000
10000
15000
20000
25000
30000
2001 2002 2003 2004
SUPPLIER
No. of Suppliers Trained
No. of Registered Suppliers
No. of Suppliers thatDownloaded Notices
No. of Notices Downloaded bySuppliers
No. of Downloaded Notices bySuppliers
41COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Appendix 5 - Report on Progress of Reforms in LGUs
1. In line with the thrust to fully disseminate the new procurement procedures, the Government ProcurementPolicy Board (GPPB) spearheaded a move to create an efficient and expeditious system of rolling outtraining of Republic Act (R.A.) 9184, otherwise known as the "Government Procurement Reform Act,"and its Implementing Rules and Regulations Part A (IRR-A) to more than 48,000 local government units.The Department of Budget and Management (DBM) tasked the Local Government Academy (LGA), thetraining arm of the Department of Interior and Local Government (DILG), to bring together a team ofnational trainors and to assist in advocating the new law through the conduct of training for a pool oftrainors from every region who, in turn, will handle the training of procurement officials - such as themembers of the Bids and Awards Committee (BAC), BAC Secretariat and the Technical Working Group(TWG) - in the respective Local Government Units (LGUs) located in their own regions. The pool oftrainors consisted of a Composite Team of Regional Trainors for each region. Each team was comprised ofrepresentatives from DBM, DILG, Commission on Audit (COA), and the Philippine League of Local BudgetOfficers (PHILLBO).1 The objective was to bring together different departments dealing with differentfacets of local government so that together they could answer all possible questions and resolve issues plusprovide information to LGUs. The goal of the entire program was to train all LGUs in the country on thebasic provisions of R.A. 9184. The strategy includes the standardization of all materials for the trainingand the distribution of Frequently Asked Questions (FAQs) from concluded training on R.A. 9184 to theparticipants.
2. After having trained the trainors, the Government Procurement Policy Board Technical Support Office(GPPB-TSO) then entered into a Memorandum of Agreement (MOA) with the PHILLBO for theorganization, arrangement, management and administration of the procurement training to be conductedby the Composite Team for LGUs in all the regions with DBM acting as the lead agency and over allcoordinator of the Team. The methodology of the LGU training programs generally utilized lecture-discussions, open forums, and workshops using case analyses and mock biddings, and pre-training andpost-training evaluation sheets.
3. Table 1 shows the status report on the training of LGUs conducted by the Composite Teams from Aprilto December 2004. This table is based on those reports that have been sufficiently documented by theGPPB-TSO. It has to be mentioned as well that, prior to the creation of the Composite Teams, the GPPB-TSO had initially conducted regional training on the new procurement law, and that this training includedLGU participants composed of Local Government Officials, Local Budget Officers, Engineers, MunicipalTreasurers, BAC Members/Secretariat and Procurement/Supply Officers. The training was conducted inRegions II, III, IV, V, VI, VII, VIII, IX, X, XI, NCR, and the Cordillera Autonomous Region (CAR) withina period from October 2002 until December 2003. Using the same GPPB-TSO pool of speakers, a similar
1 The PHILLBO is a private organization whose membership consists of local budget officers throughout the country and whosepurpose is to constantly build up, improve and strengthen the capacities of its members in LGUs through appropriateinterventions responsive to the changing demands and opportunities of the times.
42COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Region
II
III
III
IV - A2
V
VI
VII
VIII
IX
X
XI
XII
XIII
CAR
NationalCapital Region(NCR)
AutonomousRegion of MuslimMindanao(ARMM)
Total
Participants (LGUs)
Percentage ofLGUs Trained
125/12996.90%
93/9394.90%
120/13787.59%
119/14880.41%
85/12369.11%
139/139100%
130/13695.59%
139/14993.29%
52/7470.27%
98/98100%
46/5288.46%
47/5487.04%
56/7772.73%
58/8369.90%
15/1788.24%
38/10038%
1,360/1,69280.38%
Province
4 trained/4 P100%
5 trained/5 P100%
7 trained/7 P100%
5 trained/5P100%
6 trained/6 P100%
6 trained/6 P100%
4 trained/4 P100%
6 trained/6 P100%
3 trained/3 P100%
5 trained/5 P100%
4 trained/4P100%
4 trained/4 P100%
4 trained/4 P100%
6 trained/6 P100%
3 trained/5 P60%
72 trained/79 P91.14%
Municipality
113 trained/117 M96.58%
85 trained/90 M94.44%
103 trained/118 M87.29%
103 trained/132 P78.03%
73 trained/107 M68.22%
117 trained/117 M100%
114 trained/120 M95%
129 trained/139 M92.81%
44 trained/66 M66.67%
85 trained/85 M100 %
38 trained/43 M28.37%
38 trained/45 M84.44%
49 trained/70 M70%
51 trained/76 M67.11%
3 trained/4 M75%
34 trained/94 M36.17%
1,179 trained/1,494 M78.92%
City
8 trained/8 C100%
3 trained/3 P100%
10 trained/12 C83.33%
11 trained/11 P100%
6 trained/10 C60%
16 trained/16 C100%
12 trained/12 C100%
4 trained/4C100%
5 trained/5 C100%
8 trained/8 C100%
4 trained/5 C80%
5 trained/5 C100%
3 trained/3 C100%
1 trained/1 C100%
12 trained/13 C92.31%
1 trained/1 C100%
109 trained/119 C91.60%
Table 1: Summary Status Report of the Training for Local Government Units (period covering April to December2004)
1 For Region IV-B, training was handled by the Commission on Audit.
43COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
program was also conducted by the PHILLBO in November and December 2003, at Tagaytay City, IloiloCity and Davao City, covering the three island clusters of Luzon, Visayas and Mindanao, respectively.These special PHILLBO training seminars had a total of two thousand two hundred and sixty-two (2,262)participants, composed of Local Government Officials, Local Budget Officers, Engineers and MunicipalTreasurers.
4. The GOP, through the DBM-Procurement Service (PS), has also been actively marketing the G-EPS tothe LGUs, by conducting regional seminars and hands-on trainings for LGUs on its use. Table 2 showshow many LGUs have already undergone hands-on training on the G-EPS beginning in October 2002,while Table 6 shows the number of LGUs registered with the G-EPS, vis-à-vis the total number of existingLGUs.
Table 2: Number of LGUs Trained (hands-on) on the G-EPS (period covering October 1, 2002 to December 31,2004)
Table 3: Total Number of LGUs v. LGUs Registered with G-EPS (as of December 31, 2004)
5. From the above, it can be said that the GOP has been undertaking a vigorous program to disseminate andmarket the new procurement law and the G-EPS to the LGUs. Moreover, despite a low number of hands-on training on the use of the G-EPS, there appears to be a high rate of LGU registration with the G-EPS atthe provincial and city government levels. This high rate of registration appears to spring from the continuousinformation campaigns of the GPPB-TSO on the new procurement law, because the training invariablyidentifies the G-EPS as one of the mandatory features of the reform. As such, registration with the G-EPSmay, in fact, be considered as one of the indicators of the impact of R.A. 9184, and given the high rate ofregistration in the Provincial and City Governments, it becomes apparent that LGUs at this level areincreasingly becoming aware of the law and adopting it. On the other hand, the low rate of G-EPS registrationin Barangays may be attributed to a lack of training at that level and sheer lack of infrastructure.
4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr2002 2003 2003 2003 2003 2004 2004 2004 2004 Total
LGUs 90 33 22 0 81 34 11 18 54 343
Total Number of LGUs
79
119
1,494
41,975
43,667
Provincial Government
City Government
Municipal Government
Barangay
Total
Total Registered with G-EPS
60
107
438
41
646
1 GPPB-TSO2 Id.
44COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
6. To further elucidate on the impact of R.A. 9184 on the LGUs, the survey of the GPPB-TSO on LGUcompliance with the Annual Procurement Plan (APP) BAC requirements may prove to be helpful. Thissurvey was conducted by the GPPB-TSO in twenty-seven LGUs – comprising twenty-three cities/municipalities and thirteen provinces – representing the CAR, Regions I, III, IVA, IV-B, V, VI, VII, IX, XI,and the National Capital Region (NCR), from June to December 2004. First of all, it showed that all therespondents affirmed that they adopted a centralized system of procurement, which means that these LGUsare able to consolidate procurement requirements at either the Provincial, City or Municipal levels; therebyfacilitating the introduction of reforms, as most efforts may be focused on only one main and central office.
Secondly, looking at the APP and BAC provisions of R.A. 9184, Table 4 shows the percentage of complianceby the respondent LGUs with essential provisions of the law on the preparation and use of the APP, and theformation of the BAC. It should be noted, however, that some assertions contained therein may be self-serving and would have to be validated. At any rate, the results of the survey may be sufficient to justify theassertion that the reforms in the new procurement law may effectively be implemented at the Provincial,City and Municipality levels.
Table 4: LGU Compliance with APP and the BAC Requirements (as of December 31, 2004)1
Percentage of Compliance
89.8%
100%
100%
69.6%
75.2%
48.4%
45.75%
APP Requirement
Preparation of the Annual Strategic Plan
Approval of APP by Head of Procuring Entity or 2nd RankingOfficial, duly designated
APP is consistent with yearly-approved budget
APP has provisions on foreseeable emergencies, based onhistorical records
APP includes a Project Procurement Management Plan(PPMP) for each individual project
Existence of PMO that is supposed to be responsible forpreparing and updating the PPMP
BAC Secretariat is responsible for the consolidation of thePPMPs into an APP
1 GPPB-TSO
45COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Recommendations
7. Accrediting Procurement Training Programs. As pointed out above, the nationwide procurement trainingprogram of the GPPB-TSO is considered by almost all participants as both effective and advantageous.However, with the onset of this program, various groups have reportedly been undertaking their own seminarsand training programs on the new law for both NGAs and LGUs - sometimes charging hefty amounts.While the initiatives of these groups and organizations may be a welcome sign of an increased demand forknowledge on the law, the quality of these programs have sometime been questioned, and the danger ofmisinformation has been raised. In fact, it has been reported that some speakers would merely use thepresentations of the GPPB-TSO designated trainors but would not be able to explain the contents thereof.It should be noted that the GPPB has been training a national composite team of trainors specifically for thepurpose of ensuring that the new procurement law would be rolled-out to the regions with the appropriatequality checks. These composite teams are also the same groups that are currently being trained on the newharmonized Philippine Bidding Documents, so that they may likewise conduct the next level of training inthe regions. Despite this, it is recognized that these composite teams are still insufficient to cope with thepresent demand for training - discounting even the private sector. As such, although independent groupsand organizations may be allowed to conduct their own training programs on the new procurement law, itis highly recommended that the GPPB develop a mechanism to accredit procurement lecturers and theorganizations that seek to conduct public procurement training seminars, to ensure the quality of both,including that of the entire program. Although the accreditation system may not necessarily include in-house training programs, agencies seeking qualified speakers therefore may simply refer to the list ofaccredited lecturers maintained by the GPPB. This accreditation system may also be linked to the GOP'sefforts to develop a certificate program and professionalize the public procurement practice.
8. Record Keeping and Maintaining of LGU Performance. To support the training programs and as a"follow-through" for capacity building efforts at the LGU level, there is a need to strengthen the LGUs'capacity to to manage and maintain procurement records. These records will, in turn, serve as critical inputfor micro-level maintenance of LGU procurement performances.
47COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
1. As provided in the November to December 2003 Country Procurement Assessment Report (CPAR) Update,all the activities and agreed actions in the March 2003 CPAR for the Health Sector have been completed,except for the review and implementation of reforms in terms of decentralization of procurement. In thisregard, Department Memorandum No. 74, dated June 19, 2003, was issued by the Secretary of Health,directing all Directors of the Centers for Health Development (CHDs) (the equivalent of the Regional Offices)to: (i) constitute/reconstitute their Bids and Awards Committees (BACs) in accordance with Republic Act(R.A.) 9184, otherwise known as the “Government Procurement Reform Act;” (ii) institutionalise thepreparation of the Annual Procurement Plan (APP); and (iii) institutionalise a procurement monitoring systemthat will ensure adherence to the procurement timelines provided in R.A. 9184. However, there is still a needfor developing the capacities of the BACs in the various regions through training programs and seminars onprocurement. Moreover although the decentralized BACs were created by Department Memorandum No.74, the Department of Health (DOH) maintains a centralized distribution system for essential drugs.1 Itshould be noted that a Contract Distribution System (CDS) was developed by the DOH with assistance fromthe World Bank for the purpose of monitoring the demand and consumption of essential drugs. But, untilnow, this is being fully implemented only in one region, i.e., Region VI. Among the barriers to the fullimplementation of the CDS are misconceptions in the regions regarding the payment of distributors, issueson the procurement of drugs at the CHD level, warehousing, the need to upgrade facilities, and problems inmanaging the supply chain.2
2. As part of organizational reforms, by virtue of Department Order No. 210-E, dated August 2002, the DOHrestructured its Procurement and Logistics Service, by dividing it into two divisions, the Procurement Divisionand the Materials Management Division, each headed by a Director. The former acts as the Secretariat forthe Central Office Bids and Awards Committee (COBAC) and is responsible for requirements planning,sourcing and ordering, while the latter is responsible for receipt of goods, preparation of payment documents,storage and distribution. Thus, by separating logistics from the actual procurement activities, there is anincreased check and balance in the new organizational set-up.
3. With the DOH dividing its Procurement and Logistics Service into the Procurement Division and theMaterials Management Division, it has established an internal oversight committee, the ProcurementCommittee, to ensure effective operation and proper coordination between these two offices as well as thefinance units. However, a lot more has to be done on the logistics side, particularly in distribution , as therehave been problems in recent deliveries. In the case of SEMP2, while procurement (through UN agencies)
Appendix 6 - Progress of Reforms in the Health Sector
1 Based on an interview with Department of Health Undersecretary Alexander A. Padilla, Engr. Joel N. Lazo, Chief of theProcurement Division, Department of Health, and Dr. Maria Virginia Guzman-Ala, Chief, Project Management Division,Department of Health (October 4, 2004).2 Id.
48COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
and deliveries up to central warehouses have improved a lot, the on-ward distribution to the end-points (fieldoffices) in the system is a concern. Often, vaccines and drugs are distributed to the end points with only ashort time remaining before their expiry dates. The problems have become critical recently because of alogjam in the contract of a forwarder that is effecting the distribution of vaccines and drugs.
4. The November to December 2003 CPAR Update noted the strengthening of the capacity of the Bureau ofFood and Drugs (BFAD) so that the registration process has been shortened from six (6) months to two (2) tothree (3) weeks. Recently, the BFAD bid out the development of an Automated Total Solution that is intendedto further speed up the process. The project is fully locally funded and covers the purchase of equipment,system design, network installation and internet services. Hardware delivery will be completed early thisyear to allow the Design Phase and Pilot Testing to be accomplished in 2005, and the full implementation ofthe system is planned for 2006.
Recommendations
5. Supporting DOH Reforms. The DOH may need technical assistance to further develop the CDS into afully functional and effective system that is utilized in all regions. This may require addressing such issues asthe authority of CHDs to procure drugs, the upgrade of existing facilities, and a review of the DOH’s entirecentralized logistics network for drugs, i.e., not only from planning to contracting, but including warehousingand distribution.
49COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
1. Among the activities and agreed actions in the March 2003 Country Procurement Assessment Report(CPAR) for the Education Sector are the development of an effective procurement planning and inventorymonitoring system at the Regional, Division, District and School levels, and the strengthening of the Departmentof Education’s (DepEd’s) procurement capacity. To this end, DepEd, has focused much attention to twomajor areas of reform, namely the National Textbook Delivery Program (Textbook Count) and the creation ofits very own Procurement Service (PS).
2. In 2003, the DepEd undertook its first Textbook Count program, involving the procurement and delivery ofthirty seven million (37 Million) textbooks and teachers’ manuals under the 2nd Social Expenditure ManagementProject (SEMP2)/Third Elementary Education Project (TEEP), amounting to One Billion Three HundredMillion Pesos (Php1.3 Billion), awarded to six publisher/printer groups. This involved five thousand sixhundred twenty-three (5,623) delivery sites and over thirty thousand (30,000) separate deliveries nationwide.
3. The problems addressed under the 2003 Textbook Count were over-pricing, unqualified bidders winningbids, long delays in delivering textbooks, under-deliveries and substandard quality of textbook printing, bindingand packaging. Under previous findings of the Philippine Center for Investigative Journalism (PCIJ), in 1998and 1999, the average delivery period was twenty-four months and the average price per textbook was NinetyPesos (Php90.00).1 Now, by virtue of the 2003 Textbook Count, the opening of bids up to awarding ofcontract were undertaken from November 13, 2002 to January 2003, so that the contracts were awarded onMarch 2003, at an average price of Forty-one Pesos (Php41.00) per textbook (with Lesson Guides). Moreover,deliveries were completed by the end of November 2003 – translating to a completed procurement cyclewithin twelve months.2 This program also helped achieve a textbook to pupil ratio of 1:1 (except for Math 3textbooks for elementary and Math IV textbooks for high school),3 from previous ratios of 1:6 at the elementarylevel and 1:8 at the high school level.4 These results were achieved through: (i) the conduct of transparentbidding procedures that were publicly-viewed, taped and conducted with non-governmental organization(NGO) observers, all in accordance with Republic Act (R.A.) 9184; (ii) two-level, mutually exclusive, technicalevaluation process (involving financial and content evaluation); (iii) planned and surprise plant visits withCivil Service Organization (CSO)/NGO partners to check on quality; (iv) the use of a common deliveryschedule set by the DepEd as the client and not by the publishers/suppliers; (v) the use of CSOs and NGOsto monitor and inspect deliveries; (vi) detailed and full disclosure of deliveries to principals and district
1 Presentation delivered by Department of Education Undersecretary Juan Miguel Luz, during the Combating Corruption Conference, Manila,Philippines, entitled “National Textbook Delivery Program (Textbook Count) – Libro Ko, Kinabukasan Ko” (September 21, 2004).2 Id.3 Based on an interview with Department of Education Undersecretary Juan Miguel Luz and Ms. Aida Carpentero, Director of the ProcurementService, Department of Education (September 20, 2004).4 See Philippine Center for Investigative Journalism, Betrayals of the Public Trust: Investigative Reports on Corruption, at 65 (2000).
Appendix 7 - Progress of Reforms in the Education Sector
50COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
supervisors through individual letters; (vii) published school-by-school delivery schedules in local newspapers,with actual textbook numbers and range of delivery dates; and (viii) radio advertisements to announce textbookdeliveries to the general public.5
4. The DepEd has also successfully undertaken its 2nd National Textbook Delivery Program for 2004 (TextbookCount 2), involving thirteen million six hundred thousand (13.6 Million) textbooks amounting to Six HundredSixty Million Pesos (Php660 Million), to over thirty-five thousand (35,000) delivery sites nationwide, fromJuly through November 2004. Similar to the 1st Textbook Count, the 2nd Textbook Count involved partneringwith an even larger number of CSOs and NGOs (18), as well as the Government Procurement Policy Board(GPPB); but, this time, the program also taps the Boy Scouts and Girl Scouts of the Philippines organized ateach of the school sites. Aside from the World Bank financed SEMP2 and TEEP projects, textbooks from theAsian Development Bank’s Secondary Education Development and Improvement Project (SEDIP) wereincluded in the textbook delivery program for the first time. This necessitated better coordination within andoutside of DepED in view of the number of projects, suppliers/forwarder and delivery sites involved.
5. Using the provisions of Section 14 of R.A. 9184 and its Implementing Rules and Regulations Part A (IRR-A), which provides for the creation of a Secretariat in the procuring entity to support the Bids and AwardsCommittee (BAC), the DepEd created the PS. The creation of the PS was also committed to by the GOP tothe World Bank under the SEMP loan, which provides for the improvement of the performance and efficiencyof DepEd procurement systems, financial management and information communication systems.
6. The PS is tasked to act as BAC Secretariat at the central office in all biddings costing Two Hundred FiftyThousand Pesos (Php250,000) and above, as well as provide technical support in the evaluation of bids, theimplementation of a procurement tracking system, and the overseeing of contract administration, amongothers. All procurements below the Php250,000 threshold are handled by the Property Division.
The PS is headed by a Director III, and has a staffing complement of sixteen. All the positions available havebeen filled from internal and external recruitments.
7. The general functions of the PS cover the acquisition of goods and consulting services, and the contractingfor infrastructure projects; secretariat and support services to the BAC; the provision of efficient recordsmanagement of procurement documents; and contract administration. Its special functions are:
• Formulate plans, policies, standards and guidelines pursuant to R.A. 9184 and other relevant laws,rules and regulations.
5 Supra note 1.
51COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
• Procure goods and consulting services and contract for infrastructure projects, including lease ofgoods and real estate, through local or international competitive bidding, or when necessary, any ofthe alternative methods of procurement.
• Maintain the procurement database and records management.
• Liaise with the GPPB-Technical Support Office (TSO).
• Provide opportunities for the training of personnel to professionalize the procurement service and theprocurement functions within DepEd.
• Advise the Secretary of Education on procurement matters.
Recommendations
8. Supporting DepEd Reforms. The initiative of the DepEd to institutionalize internal procurement reformsthrough the creation of its PS has to be supported. In particular, now that the PS is fully staffed, it would needto undergo training sessions to build its capacity on database and records management, project management,local and international procurement procedures, and effective planning, among others. It would have toestablish an effective partnership with the GPPB-TSO to be kept abreast with updates on the GOP’s overallprocurement reform program. It would also need to institutionalize its arrangements with CSOs/NGOs for acontinued effective partnership in procurement and contract administration undertakings.
53COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Appendix 8 - Baseline Indicator System ReportBaseline Indicator System with Weights
The assessment of the Philippines’ public procurement system was conducted on the basis of four (4) keyareas called “Pillars,” which are composed of twelve (12) Indicators that have been identified as the corecomponents of a public procurement system. These twelve (12) Indicators are, in turn, composed of Baselinesthat are considered the desirable standards against which the existing elements of the Philippines’ publicprocurement system may be assessed. The table below provides for the descriptive analysis of the ratingas to where, how and why the Philippines fully or fails to achieve this standard.
For the assessment, points were given to each Baseline, the total of which corresponds to weights assignedto each of the Indicators. In turn, the weights of these Indicators comprise the total score for each of thefour (4) Pillars. To reflect their equal importance, each of the Pillars was given a weight of twenty-fivepercent (25%) each, amounting to a grand total of one hundred percent (100%). The distribution of pointswas based upon the importance and relevance of each of the Baselines and Indicators involved, in relationto the Philippines’ public procurement reform program.
Baselines
• Baseline (a) – Scope of application and coverage of thelegislative and regulatory framework (20% of Indicator)
1. Contracting entities at all levels, including governmentauthorities, municipalities, regional authorities and utilities/state-owned enterprise, are covered (5%)
2. All areas of procurement; works, goods and consultingservices are included (5%)
3. Procurement using public funds, irrespective of contractvalue, is included (5%)
4. The applicable legislative and regulatory framework isstructured, consistent, and accessible to users and allinterested stakeholders (5%)
Answers/Comments
• Yes. Sec. 4, R.A.9184.
• Yes. Sec. 4, R.A.9184.
• Yes. Sec. 1, IRR-A, R.A. 9184.
• Yes. R.A. 9184.provides for openand competitivebidding.
Indicators
• Indicator 1 – Publicprocurementlegislative andregulatory frameworkachieves the agreedstandards andcomplies withapplicable obligations(15%)
PILLAR I – THE LEGISLATIVE AND REGULATORY FRAMEWORK (25%)
Baselines
• Baseline (b) – Procurement methods (15% of Indicator)
1. Stated preference for the use of open, competitiveprocurement unless otherwise justified in accordance withthe legislative and regulatory framework (3.75%)
2. International competitive tendering methods defined forspecified contracts (e.g. where monetary thresholds exist)that are consistent with international standards (3.75%)
3. Defined basis for the procurement method, if other thanopen competition (3.75%)
4. Negotiated procedures and direct purchasing only underwell defined and justified circumstances, subject to controls(3.75%)
· Baseline (c) – Advertising rules and time limits (10% of Indicator)
1. Mandatory and accessible publication of opportunities forcompetitive procurement (3.33%)
2. Mandatory publication of result information on contractawards based on defined thresholds (3.33%)
3. Minimum time limits for submission of tenders andapplications, which should be consistent with methods ofprocurement, national conditions and when applicable,international requirements (3.33%)
· Baseline (d) – Rules on participation and qualitative selection(15% of Indicator)
1. Fair, predictable and defined rules for participation that relyon qualifications and ability to perform the requirement(3.75%)
2. Limited and controlled use of price preferential clauses(3.75%)
3. Debarment process if covered, on defined basis, allowingfor due process and appeal (3.75%)
4. Rules for participation of government-owned enterprise thatprovide for equal treatment in competitive procurement(3.75%)
·
Answers/Comments
• Yes. Sec. 10, R.A.9184.
• No. R.A. 9184 isgenerally not opento foreigncompetition, butexceptions exist.
• Yes. Secs. 48 to 54,R.A. 9184.
• Yes. Secs. 50, 52and 53, R.A. 9184.
• Yes. Sec. 21, R.A.9184.
• Yes. Postingrequirement in G-EPS.
• Yes. Annex C, IRR-A, R.A. 9184.
• Yes. Secs. 23 and24, R.A. 9184.
• Yes. R.A. 9184 hasclear conditions.
• Yes. R.A. 9184 hasblacklisting andprotest mechanismsand.
• Yes. R.A. 9184allows GOCCs to bidcompetitively.
Indicators
• Indicator 1 – Publicprocurementlegislative andregulatory frameworkachieves the agreedstandards andcomplies withapplicable obligations(15%)
Baselines
• Baseline (e) – Tender documentation and technical specifications(5% of Indicator)
1. The minimum content of the tender documentation isspecified (2.5%)
2. Neutral technical specification with reference tointernational standards where possible (2.5%)
• Baseline (f) – Tender evaluation and award criteria (15% ofIndicator)
1. Objective, fair and pre-disclosed criteria for evaluation andaward of contracts (7.5%)
2. Clear methodology for evaluation of tenders based on priceand other fully disclosed factors leading to award ofcontract (7.5%)
• Baseline (g) – Submission, receipt and opening of tenders (15%of Indicator)
1. Public opening of tenders in a defined manner that ensuresthe regularity of the proceedings (5%)
2. Clear requirement to maintain records of proceedings andprocess that are available for review/audit (5%)
3. Requirement to maintain security and confidentiality oftenders prior to bid opening (5%)
• Baseline (h) – Complaint review procedures (5% of Indicator)
1. Inclusion of complaint and remedy procedures that providefor fair, independent and timely implementation (5%)
·
Answers/Comments
• Yes. R.A. 9184provides forminimumrequirements.
• Yes. R.A. 9184prohibits use ofbrand names.
• Yes. Secs. 32 and33 of R.A. 9184.
• Yes. Secs. 32 and33 of R.A. 9184.
• Yes. Sec. 29, R.A.9184.
• Yes. BACSecretariat requiredto keep records ofbidding.
• Yes. Confidentialityclause and penalprovisions in R.A.9184.
• Yes. Art. XVII, R.A.9184.
Indicators
• Indicator 1 – Publicprocurementlegislative andregulatory frameworkachieves the agreedstandards andcomplies withapplicable obligations(15%)
Baselines
• Baseline (a) – The existence and availability of implementingregulation that provides defined processes and procedures notincluded in higher level legislation (20% of Indicator)
• Baseline (b) – The existence and availability of model tenderdocuments for goods, works and services (20% of Indicator)
• Baseline (c) – The existence and availability of procedures forpre-qualification (10% of Indicator)
• Baseline (d) – The existence and availability of proceduressuitable for contracting for services or other requirements wheretechnical capacity is a key criteria (10% of Indicator)
• Baseline (e) – The existence and availability of user’s guideor manual for contracting entities (20% of Indicator)
• Baseline (f) – The existence and availability of GeneralConditions of Contracts for public sector contracts coveringgoods, works and services consistent with nationalrequirements and international requirements whenapplicable (20% of Indicator)
·
Answers/Comments
• Qualified Yes. IRR-A, R.A. 9184 coverslocally-fundedprojects, whileForeign-AssistedProjects are coveredby Secs. 4 and 43 ofthe law.
• Yes. Sec. 6, R.A.9184 andHarmonizedPhilippine BiddingDocuments.
• Yes. Eligibility isequivalent toprequalification.
• Yes. R.A. 9184allows QBSprocedures forconsulting services.
• Qualified Yes.ProcurementManuals have beendrafted and ready forissuance.
• Yes. In theHarmonizedPhilippine BiddingDocuments.
Indicators
• Indicator 2 –Existence of ImplementingRegulations andDocumentation (10%)
Baselines
• Baseline (a) – Procurement planning and data on costing is partof the budget formulation process and contributes to multi-yearplanning (30% of Indicator)
• Baseline (b) – Budget Law supports timely procurement, contractexecution and payment (10% of Indicator)
• Baseline (c) – No initiation of procurement actions withoutexisting budget appropriations (20% Indicator)
• Baseline (d) – Contract execution is subject to budgetarycontrols to ensure sufficient funding for contract (20% Indicator)
• Baseline (e) – Budgeting system provides for timelyrelease of funds to make payments against contractualobligations (20% of Indicator)
• Baseline (a) – The status and basis for the functional normativebody at the centre (the Body) is covered in the legislative andregulatory framework (30% of Indicator)
• Baseline (b) – The responsibilities of the Body address a definedset of functions which include, but are not limited to: theprovisions of advise to contracting entities; drafting amendmentsto the legislative and regulatory framework and implementingregulations; providing monitoring of public procurement;providing procurement information; reporting on procurement toother parts of government; developing and supportingimplementation of initiatives for improvements of thedevelopment of implementing staff (20% of Indicator)
• Baseline (c) – Organization and staffing of the Body and thelevel of independence and authority (formal power) of the bodyto exercise its duties is sufficient and consistent with theresponsibilities (30% of Indicator)
• Baseline (d) – Responsibilities of the Body provide for separationand clarity so as to avoid conflict of interest (20% of Indicator)
·
Answers/Comments
• Yes. Art. II, R.A.9184 and P.D. 1177.
• Yes. P.D. 1177 andin GAA.
• Yes. R.A. 9184provides forApproval Budget forthe Contract prior toprocurement.
• Yes. R.A. 9184, P.D.1177, P.D. 1445.
• Qualified No.Delayed release offunds at times, butthere is a pilotpayment systemthrough the banksfor DPWH.
• Yes. Art. XX, R.A.9184.
• Yes. Art. XX, R.A.9184.
• Yes. Art. XX, R.A.9184 provides forcabinet-levelrepresentation and aTechnical SupportOffice.
• Yes. Art. XX, R.A.9184 provides for anindependent inter-agency body.
Indicators
• Indicator 3 –MainstreamingProcedures intoPublic FinancialManagement (9%)
• Indicator 4 –Functional NormativeBody (the Body) at theCentre (8%)
PILLAR II – CENTRAL INSTITUTIONAL FRAMEWORK AND CAPACITY (25%)
Baselines
• Baseline (a) – A system exists for collection and dissemination ofprocurement information, including tender invitations, request forproposals and contract award information (15% of Indicator)
• Baseline (b) – A sustainable strategy exists to provide trainingadvice and assistance to develop the capacity of governmentand private sector participants to understand the rules andregulations and how they should be implemented (30% ofIndicator)
• Baseline (c) – Systems and procedures exist for collection andmonitoring of national procurement statistics (25% of Indicator)
• Baseline (d) – Quality control standards are disseminated andused to evaluate performance of staff and address capacitydevelopment issues (30% of Indicator)
·
Answers/Comments
• Qualified Yes. Acentral portal existsbut contract awardinformation is not yetaccessible.
• Qualified Yes. Sec.16, R.A. 9184 andprogram toprofessionalizepublic procurement,but private sector isnot included.
• No. Rudimentarysystem which has tobe developedfurther.
• No. Quality controlstandards still haveto be developed.
Indicators
• Indicator 5 –Existence ofInstitutionalDevelopmentCapacity (8%)
Baselines
• Baseline (a) – At the contracting entity level, the level ofprocurement competence among government officialswithin the entity is consistent with their procurementresponsibilities (25% of Indicator)
• Baseline (b) – At the contracting entity level, theprocurement training and information programmesimplemented for government officials, as well as for privatesector participants is consistent with demand (25% ofIndicator)
• Baseline (c) – At the contracting entity level, the existence ofadministrative systems for public procurement operations, andinformation databases to support monitoring of performance andreporting to and responding to the needs of other relatedgovernment systems (25% of Indicator)
• Baseline (d) – At the contracting entity level, the existence andimplementation of internal control mechanisms for theundertaking of procurement operations at the contracting level,including a code of conduct, separation of responsibilities as acheck/balance mechanism and oversight/control of signature/approval authority (25% of Indicator)
·
Answers/Comments
• No. Professionalprogram is not yet infull swing.
• No. The demand ofpublic and privatesector participantsstill has to be met.
• Qualified Yes.Administrativesystems exist, butthese have to beimproved becausethey do not yetadequately supportmonitoringperformance.Although someagencies havesuccessfullydevelopedprocurementsystems andinformationdatabases to supportmonitoring activities.
• Qualified Yes. E.O.109-A provides forsigning authorities,and various laws andexecutive orders tostrengthen internalcontrol mechanismshave been issued.Although mostagencies haveinternal audit unitsand/or internalcontrol systems, thishas not beeninstitutionalized on anationwid scale.
Indicators
• Indicator 6 – EfficientProcurementOperations andPractice (10%)
PILLAR III – PROCUREMENT OPERATIONS AND PUBLIC PROCUREMENT MARKETPERFORMANCE (25%)
Baselines
• Baseline (a) – The public procurement market in the country hassufficient numbers of producers/suppliers to provide forcompetition and comparative pricing for goods, works andservices when compared to prices paid for similar requirementsin local, regional or international markets as applicable (30% ofIndicator)
• Baseline (b) – The quality and consistency of submissions by theprivate sector to the government enables the application of theprocess leading to the award and completion of contracts (20%of Indicator)
• Baseline (c) – The participation rate of tenderers in response tocompetitive tender invitations is consistent with the capacity ofthe marketplace (20% of Indicator)
• Baseline (d) – The private sector confidence in the legal andregulatory framework governing the procurement process isevidenced by their use of complaints or protests mechanisms(30% of Indicator)
• Baseline (a) – Procedures are defined for undertaking contractadministration responsibilities to include inspection andacceptance procedures, quality control procedures and methodsto review and issue contract amendments in a timely manner(50% of Indicator)
• Baseline (b) – Dispute resolution procedures are included in thecontract document providing for an efficient and fair process toresolve disputes arising during the performance of the contract(25% of Indicator)
• Baseline (c) – Procedures exist to enforce the outcome of thedispute resolution process (25% of Indicator)
Answers/Comments
• Yes. Sufficientenough to conduct acompetitive biddingfor most items andworks.
• Yes. Private sectoris generally capableof complying withbiddingrequirements.
• No. Politicalinterventions distortcompetition andparticipation rate.There are privatesector companiesthat have not beenparticipating.
• No. Few complaintsreceived.Information onconfidence level islacking becauseR.A. 9184 isrelatively new.
• Yes. R.A. 9184provides for contractadministration,variation orders/amendments andwarranties.
• Yes. Art. XVIII ofR.A. 9184.
• Yes. Arbitration Lawprovides for this.
Indicators
• Indicator 7 –Functionality of thePublic ProcurementMarket (10%)
• Indicator 8 – Existenceof ContractAdministration andDispute ResolutionProvisions (5%)
Baselines
• Baseline (a) – A legal framework, organization, policy andprocedures for internal and external control and audit of publicprocurement operations exists and operates to provide afunctioning control framework (25% of Indicator)
• Baseline (b) – Enforcement and follow-up on findings andrecommendations of the control framework provide anenvironment that fosters compliance (20% of Indicator)
• Baseline (c) – The internal control system provides timelyinformation on compliance to enable management action (20% ofIndicator)
• Baseline (d) – The internal control systems are sufficientlydefined to enable performance audits to be conducted (10% ofIndicator)
• Baseline (e) – Auditors are sufficiently informed aboutprocurement requirements and controls systems to conductquality audits that contribute to compliance (25% of Indicator)
·
Answers/Comments
• Qualified Yes. Lawssuch as P.D. 1445and R.A. 3456govern thesematters. Existingsystems in mostagencies have to beimproved. Mostagencies have nointernal audit units/internal controlsystems.
• No. There is lack ofenforcement.
• No. Weak internalcontrol in mostagencies.
• Yes. Internal controlsystem existing areclearly defined.
• Qualified Yes. Someauditors are notsufficiently informedof procurementrequirements. Thereare complaints aboutconflicting COAinterpretations ofprocurement law.
Indicators
• Indicator 9 – EffectiveControl and AuditSystem (8%)
PILLAR III – THE INTEGRITY AND TRANSPARENCY OF THE PUBLIC PROCUREMENT SYSTEM(25%)
Baselines
• Baseline (a) – The existence and operation of a complaint reviewsystem that gives participants in the public procurement processa right to file a complaint within the framework of anadministrative and judicial review procedure (25% of Indicator)
• Baseline (b) – Decisions are deliberated on the basis of availableinformation and the final decision can be reviewed and ruledupon by a body with judicial capacity under the law (15% ofIndicator)
• Baseline (c) – The complaint review system has the capacity tohandle lodged complaints efficiently and a means to enforce theremedy imposed (25% of Indicator)
• Baseline (d) – The system operates in a fair manner, withoutcomes of decisions balanced and justified on the basis ofavailable information (10% of Indicator)
• Baseline (e) – Decisions are published and made available to thepublic (15% of Indicator)
• Baseline (f) – Administrative review body is separate from theregulatory body (10% of Indicator)
• Baseline (a) – Access to information is supported by publicationand distribution of information through available media withsupport from information technology when feasible (50% ofIndicator)
• Baseline (b) – Systems exist to collect key data related toperformance of the procurement system and to report regularly(25% of Indicator)
• Baseline (c) – Records are maintained to validate data (25% ofIndicator)
Answers/Comments
• Yes. Art. XVII ofR.A. 9184.
• Yes. Art. XVII ofR.A. 9184.
• Yes. There areadministrative, civiland criminalliabilities in R.A.9184.
• No. No sufficientinformation exists inthis area.
• No. There is norequirement topublish decisions.
• No. There is nocentraladministrativereview body.
• Qualified No. R.A.9184 requirespublication/ postingin generalnewspapers,websites and the G-EPS, but full accessof information is notfully institutionalized.
• Qualified No.Although someagencies havesystems, the keydata actually needsto be identified.
• Qualified Yes.Agencies maintainrecords. Contents ofthe records have tobe defined.
Indicators
• Indicator 10 –Efficiency of AppealsMechanism (5%)
• Indicator 11 – Degreeof Access toInformation (4%)
Baselines
• Baseline (a) – The legal and regulatory framework forprocurement, including tender and contract documents, includesprovisions addressing the issues of corruption, fraud, conflict ofinterest and unethical behaviour and states actions which can betaken with regard to such behaviour (either directly or byreference to other laws) (50% of Indicator)
• Baseline (b) – Special measures by the government to preventand detect potential fraud and corruption in public procurementis addressed in an anti-corruption programme (25% of Indicator)
• Baseline (c) – Stakeholders (private sector and civil society)support the creation of a procurement market known for itsintegrity and ethical behaviour (25% of Indicator)
Answers/Comments
• Yes. R.A. 9184includes provisionson all these matters.Other laws alsoaddress these, e.g.,R.A. 3019 and 6713.
• Qualified Yes. Thereis an anti-corruptionprogram thatinvolves CSOs, butit needs furtherdevelopment toaddresseffectiveness.
• Yes. There is strongCSO involvement,which finds supportin Secs. 13 and 64of R.A. 9184.
Indicators
• Indicator 12 – Ethicsand Anti-corruptionMeasures (8%)
Assessment Ratings
The following Assessment Ratings per Indicator shall be used to determine the level of achievement met bythe Philippines, to provide a profile or mapping of its existing public procurement system. The AssessmentRatings are based upon the points garnered for each Baseline.
Level of Achievement
0 – 20% of Indicator 21 – 50% of Indicator 51 – 80% of Indicator 81 – 100% of Indicator
Legend:
NA – No Baseline elements substantially metPA – Less than 50% of Baseline elements substantially metSA – More than 50% of Baseline elements substantially metFA – All baseline elements are substantially met
Application
Applying the BIS weights upon the Philippines’ national procurement system, a Grand Total Score of67.29% was garnered as a result of the scores achieved by the Philippines in the attached BIS Rating Sheetand Charts. Adopting the above Assessment Ratings for the Indicators, this translates to a Level ofAchievement whereby more than fifty percent (50%) of ALL Baseline elements have been substantiallymet (SA).
NA PA SA FA
BIS
Ratin
g Sh
eet
25.0
0%22
.44%
89.7
4%FA
15%
14.4
4%96
.24%
FA
0.20
00.
200
3.00
%0.
050
0.05
00.
050
0.05
00.
050
0.05
00.
050
0.05
00.
150
0.11
31.
69%
0.03
80.
038
0.03
80.
000
0.03
80.
038
0.03
80.
038
0.10
00.
100
1.50
%0.
033
0.03
30.
033
0.03
3
0.03
30.
033
0.15
00.
150
2.25
%0.
038
0.03
80.
038
0.03
80.
038
0.03
8
0.03
80.
038
0.05
00.
050
0.75
%0.
025
0.02
5
0.02
50.
025
0.15
00.
150
2.25
%0.
075
0.07
50.
075
0.07
50.
150
0.15
02.
25%
0.05
00.
050
0.05
00.
050
0.05
00.
050
0.05
00.
050
0.75
%
0.05
00.
050
Leve
l of A
chie
vem
ent
Pilla
rs/In
dica
tors
/Bas
elin
es
2. In
tern
atio
nal c
ompe
titiv
e pr
oced
ures
Base
line
(d) R
ules
on
parti
cipa
tion
and
qual
itativ
e se
lect
ion
1. M
anda
tory
and
acc
essi
ble
publ
icat
ion
of o
ppor
tuni
ties
2. M
anda
tory
pub
licat
ion
of re
sults
bas
ed o
n th
resh
olds
3. M
inim
um ti
me
limits
for s
ubm
issi
on o
f ten
ders
con
sist
ent w
ith
met
hods
of
proc
urem
ent
4. J
ustif
icat
ions
and
con
trols
for n
egot
iatio
n/di
rect
con
tract
ring
2. A
ll ar
eas
of p
rocu
rem
nt in
clud
ed
3. U
se o
f pub
lic fu
nds
rega
rdle
ss o
f val
ue
3. D
efin
ed b
asis
for u
se o
f oth
er p
rocu
rem
ent m
etho
d
1. P
refe
renc
e fo
r ope
n an
d co
mpe
titiv
e bi
ddin
gBa
selin
e (b
) Pro
cure
men
t Met
hods
Rat
ing
Pilla
r I -
The
Legi
slat
ive
and
Reg
ulat
ory
Fram
ewor
k W
eigh
ts
1. S
cope
and
cov
erag
e
Base
line
(a) S
cope
of a
pplic
atio
n an
d co
vera
ge o
f the
legi
slat
ive
and
regu
lato
ry fr
amew
ork
2. L
imite
d an
d co
ntro
lled
use
of p
rice
pref
eren
tial c
laus
es
4. C
onsi
sten
t and
acc
essi
ble
to a
ll
2. C
lear
met
hodo
logy
for e
valu
atio
n ba
sed
on d
iscl
osed
fact
ors
Base
line
(g) S
ubm
issi
on, r
ecei
pt a
nd o
peni
ng o
f ten
ders
1. P
ublic
ope
ning
in a
def
ined
man
ner
2. C
lear
requ
irem
ent t
o m
aint
ain
reco
rds
for r
evie
w/a
udit
3. R
equi
rem
ent f
or s
ecur
ity a
nd c
onfid
entia
lity
of te
nder
s
1. C
ompl
aint
and
rem
edy
proc
edur
es in
clud
ed a
nd p
rovi
des
for f
air,
inde
pend
ent a
nd ti
mel
y im
plem
enta
tion
Base
line
(c) A
dver
tisin
g ru
les
and
time
limits
Base
line
(h) C
ompl
aint
revi
ew p
roce
dure
s
Base
line
(f) T
ende
r eva
luat
ion
and
awar
d cr
iteria
4. E
qual
trea
tmen
t for
gov
ernm
ent o
wne
d en
terp
rises
in c
ompe
titiv
e pr
ocur
emen
t
2. N
eutra
l tec
hnic
al s
peci
ficat
ions
with
refe
renc
e to
inte
rnat
iona
l st
anda
rds
whe
re p
ossi
ble
1. M
inim
um c
onte
nt o
f ten
der d
ocum
enta
tion
spec
ified
3. D
efin
ed d
ebar
men
t pro
cess
w/ d
ue p
roce
ss a
nd a
ppea
l
1. F
air,
pred
icta
ble
and
defin
ed ru
les
base
d on
qua
lific
atio
ns
Base
line
(e) T
ende
r doc
umen
tatio
n an
d te
chni
cal s
peci
ficat
ions
1. O
bjec
tive,
fair,
and
pre
-dis
clos
ed c
riter
ia fo
r eva
luat
ion/
awar
d
Indi
cato
r 1 –
Pub
lic p
rocu
rem
ent l
egis
lativ
e an
d re
gula
tory
fram
ewor
k ac
hiev
es th
e ag
reed
sta
ndar
ds a
nd c
ompl
ies
with
app
licab
le o
blig
atio
ns
Lege
nd:
NA
- No
Base
line
elem
ents
sub
stan
tially
met
PA -
Less
than
50%
of B
asel
ine
elem
ents
sub
stan
tially
met
SA -
Mor
e th
an 5
0% o
f Bas
elin
e el
emen
ts s
ubst
antia
lly m
etFA
- Al
l Bas
elin
e el
emen
ts a
re s
ubst
antia
lly m
et
Indi
cato
r 2 -
Exi
sten
ce o
f Im
plem
entin
g R
egul
atio
ns a
nd D
ocum
enta
tion
10.0
%8.
00%
80.0
%FA
0.20
00.
100
1.00
%
0.20
00.
200
2.00
%
0.10
00.
100
1.00
%
0.10
00.
100
1.00
%
0.20
00.
100
1.00
%
0.20
00.
200
2.00
%
Bas
elin
e (b
) – T
he e
xist
ence
and
ava
ilabi
lity
of m
odel
tend
er d
ocum
ents
fo
r goo
ds, w
orks
and
ser
vice
s
Bas
elin
e (c
) – T
he e
xist
ence
and
ava
ilabi
lity
of p
roce
dure
s fo
r pre
-qu
alifi
catio
n
Bas
elin
e (d
) – T
he e
xist
ence
and
ava
ilabi
lity
of p
roce
dure
s su
itabl
e fo
r co
ntra
ctin
g fo
r ser
vice
s or
oth
er re
quire
men
ts w
here
tech
nica
l cap
acity
is a
ke
y cr
iteria
Bas
elin
e (e
) – T
he e
xist
ence
and
ava
ilabi
lity
of u
ser’s
gui
de o
r man
ual f
or
cont
ract
ing
entit
ies
Bas
elin
e (a
) – T
he e
xist
ence
and
ava
ilabi
lity
of im
plem
entin
g re
gula
tion
that
pro
vide
s de
fined
pro
cess
es a
nd p
roce
dure
s no
t inc
lude
d in
hig
her
leve
l leg
isla
tion
Bas
elin
e (f)
– T
he e
xist
ence
and
ava
ilabi
lity
of G
ener
al C
ondi
tions
of
Con
tract
s fo
r pub
lic s
ecto
r con
tract
s co
verin
g go
ods,
wor
ks a
nd s
ervi
ces
cons
iste
nt w
ith n
atio
nal r
equi
rem
ents
and
inte
rnat
iona
l req
uire
men
ts w
hen
appl
icab
le
25.0
0%17
.90%
71.6
0%SA
9.00
%8.
10%
90.0
%S
A0.
300
0.30
02.
70%
0.10
00.
100
0.90
%
0.20
00.
200
1.80
%
0.20
00.
200
1.80
%
0.20
00.
100
0.90
%
8.00
%8.
00%
100.
00%
FA0.
300
0.30
02.
40%
0.20
00.
200
1.60
%
0.30
00.
300
2.40
%
0.20
00.
200
1.60
%
8.00
%1.
80%
22.5
%P
A0.
150
0.07
50.
60%
0.30
00.
150
1.20
%
0.25
00.
000
0.00
%
0.30
00.
000
0.00
%
Bas
elin
e (a
) – P
rocu
rem
ent p
lann
ing
and
data
on
cost
ing
is p
art o
f the
bu
dget
form
ulat
ion
proc
ess
and
cont
ribut
es to
mul
ti-ye
ar p
lann
ing
Bas
elin
e (c
) – O
rgan
izat
ion
and
staf
fing
of th
e B
ody
and
the
leve
l of
inde
pend
ence
and
aut
horit
y (fo
rmal
pow
er) o
f the
bod
y to
exe
rcis
e its
du
ties
is s
uffic
ient
and
con
sist
ent w
ith th
e re
spon
sibi
litie
s
Bas
elin
e (d
) – R
espo
nsib
ilitie
s of
the
Bod
y pr
ovid
e fo
r sep
arat
ion
and
clar
ity s
o as
to a
void
con
flict
of i
nter
est
Indi
cato
r 5 –
Exi
sten
ce o
f Ins
titut
iona
l Dev
elop
men
t Cap
acity
B
asel
ine
(a) –
A s
yste
m e
xist
s fo
r col
lect
ion
and
diss
emin
atio
n of
pr
ocur
emen
t inf
orm
atio
n, in
clud
ing
tend
er in
vita
tions
, req
uest
for p
ropo
sals
an
d co
ntra
ct a
war
d in
form
atio
n
Bas
elin
e (b
) – A
sus
tain
able
stra
tegy
exi
sts
to p
rovi
de tr
aini
ng a
dvic
e an
d as
sist
ance
to d
evel
op th
e ca
paci
ty o
f gov
ernm
ent a
nd p
rivat
e se
ctor
pa
rtici
pant
s to
und
erst
and
the
rule
s an
d re
gula
tions
and
how
they
sho
uld
be im
plem
ente
d
Bas
elin
e (d
) – C
ontra
ct e
xecu
tion
is s
ubje
ct to
bud
geta
ry c
ontro
ls to
en
sure
suf
ficie
nt fu
ndin
g fo
r con
tract
Bas
elin
e (e
) – B
udge
ting
syst
em p
rovi
des
for t
imel
y re
leas
e of
fund
s to
m
ake
paym
ents
aga
inst
con
tract
ual o
blig
atio
ns
Indi
cato
r 4 –
Fun
ctio
nal N
orm
ativ
e B
ody
(the
Bod
y) a
t the
Cen
tre
Bas
elin
e (c
) – S
yste
ms
and
proc
edur
es e
xist
for c
olle
ctio
n an
d m
onito
ring
of n
atio
nal p
rocu
rem
ent s
tatis
tics
Pilla
r II -
Cen
tral
Inst
itutio
nal F
ram
ewor
k an
d C
apac
ity
Bas
elin
e (b
) – B
udge
t Law
sup
ports
tim
ely
proc
urem
ent,
cont
ract
ex
ecut
ion
and
paym
ent
Bas
elin
e (c
) – N
o in
itiat
ion
of p
rocu
rem
ent a
ctio
ns w
ithou
t exi
stin
g bu
dget
ap
prop
riatio
ns
Indi
cato
r 3 –
Mai
nstre
amin
g P
roce
dure
s in
to P
ublic
Fin
anci
al M
anag
emen
t
Bas
elin
e (d
) – Q
ualit
y co
ntro
l sta
ndar
ds a
re d
isse
min
ated
and
use
d to
ev
alua
te p
erfo
rman
ce o
f sta
ff an
d ad
dres
s ca
paci
ty d
evel
opm
ent i
ssue
s
Bas
elin
e (a
) – T
he s
tatu
s an
d ba
sis
for t
he fu
nctio
nal n
orm
ativ
e bo
dy a
t th
e ce
ntre
is c
over
ed in
the
legi
slat
ive
and
regu
lato
ry fr
amew
ork
Bas
elin
e (b
) – T
he re
spon
sibi
litie
s of
the
Bod
y ad
dres
s a
defin
ed s
et o
f fu
nctio
ns w
hich
incl
ude,
but
are
not
lim
ited
to: t
he p
rovi
sion
s of
adv
ise
to
cont
ract
ing
entit
ies;
dra
fting
am
endm
ents
to th
e le
gisl
ativ
e an
d re
gula
tory
fra
mew
ork
and
impl
emen
ting
regu
latio
ns; p
rovi
ding
mon
itorin
g of
pub
lic
proc
urem
ent;
prov
idin
g pr
ocur
emen
t inf
orm
atio
n; re
porti
ng o
n pr
ocur
emen
t to
oth
er p
arts
of g
over
nmen
t; de
velo
ping
and
sup
porti
ng im
plem
enta
tion
of
initi
ativ
es fo
r im
prov
emen
ts o
f the
dev
elop
men
t of i
mpl
emen
ting
staf
f
25.0
0%12
.50%
50.0
0%PA
10%
2.50
%25
.00%
PA
0.25
00.
000
0.00
%
0.25
00.
000
0.00
%
0.25
00.
125
1.25
%
0.25
00.
125
1.25
%
10.0
0%5.
00%
50.0
0%P
A0.
300
0.30
03.
00%
0.20
00.
200
2.00
%
0.20
00.
000
0.00
%
0.30
00.
000
0.00
%
5.00
%5.
00%
100.
00%
FA0.
500
0.50
02.
50%
0.25
00.
250
1.25
%
0.25
00.
250
1.25
%
Bas
elin
e (d
) – A
t the
con
tract
ing
entit
y le
vel,
the
exis
tenc
e an
d im
plem
enta
tion
of in
tern
al c
ontro
l mec
hani
sms
for t
he u
nder
taki
ng o
f pr
ocur
emen
t ope
ratio
ns a
t the
con
tract
ing
leve
l, in
clud
ing
a co
de o
f co
nduc
t, se
para
tion
of re
spon
sibi
litie
s as
a c
heck
/bal
ance
mec
hani
sm a
nd
over
sigh
t/con
trol o
f sig
natu
re/a
ppro
val a
utho
rity
Bas
elin
e (a
) – A
t the
con
tract
ing
entit
y le
vel,
the
leve
l of p
rocu
rem
ent
com
pete
nce
amon
g go
vern
men
t offi
cial
s w
ithin
the
entit
y is
con
sist
ent w
ith
thei
r pro
cure
men
t res
pons
ibili
ties
Pilla
r III
- Pr
ocur
emen
t Ope
ratio
ns a
nd P
ublic
Pro
cure
men
t Mar
ket P
erfo
rman
ce
Indi
cato
r 6 –
Effi
cien
t Pro
cure
men
t Ope
ratio
ns a
nd P
ract
ice
Indi
cato
r 8 –
Exi
sten
ce o
f Con
tract
Adm
inis
tratio
n an
d D
ispu
te R
esol
utio
n P
rovi
sion
s
Bas
elin
e (c
) – P
roce
dure
s ex
ist t
o en
forc
e th
e ou
tcom
e of
the
disp
ute
reso
lutio
n pr
oces
s
Indi
cato
r 7 –
Fun
ctio
nalit
y of
the
Pub
lic P
rocu
rem
ent M
arke
t
Bas
elin
e (b
) – T
he q
ualit
y an
d co
nsis
tenc
y of
sub
mis
sion
s by
the
priv
ate
sect
or to
the
gove
rnm
ent e
nabl
es th
e ap
plic
atio
n of
the
proc
ess
lead
ing
to
the
awar
d an
d co
mpl
etio
n of
con
tract
s
Bas
elin
e (d
) – T
he p
rivat
e se
ctor
con
fiden
ce in
the
lega
l and
regu
lato
ry
fram
ewor
k go
vern
ing
the
proc
urem
ent p
roce
ss is
evi
denc
ed b
y th
eir u
se o
f co
mpl
aint
s or
pro
test
s m
echa
nism
s
Bas
elin
e (a
) – P
roce
dure
s ar
e de
fined
for u
nder
taki
ng c
ontra
ct
adm
inis
tratio
n re
spon
sibi
litie
s to
incl
ude
insp
ectio
n an
d ac
cept
ance
pr
oced
ures
, qua
lity
cont
rol p
roce
dure
s an
d m
etho
ds to
revi
ew a
nd is
sue
cont
ract
am
endm
ents
in a
tim
ely
man
ner
Bas
elin
e (c
) – T
he p
artic
ipat
ion
rate
of t
ende
rers
in re
spon
se to
co
mpe
titiv
e te
nder
invi
tatio
ns is
con
sist
ent w
ith th
e ca
paci
ty o
f the
m
arke
tpla
ce
Bas
elin
e (b
) – A
t the
con
tract
ing
entit
y le
vel,
the
proc
urem
ent t
rain
ing
and
info
rmat
ion
prog
ram
mes
impl
emen
ted
for g
over
nmen
t offi
cial
s, a
s w
ell a
s fo
r priv
ate
sect
or p
artic
ipan
ts is
con
sist
ent w
ith d
eman
d
Bas
elin
e (a
) – T
he p
ublic
pro
cure
men
t mar
ket i
n th
e co
untry
has
suf
ficie
nt
num
bers
of p
rodu
cers
/sup
plie
rs to
pro
vide
for c
ompe
titio
n an
d co
mpa
rativ
e pr
icin
g fo
r goo
ds, w
orks
and
ser
vice
s w
hen
com
pare
d to
pr
ices
pai
d fo
r sim
ilar r
equi
rem
ents
in lo
cal,
regi
onal
or i
nter
natio
nal
mar
kets
as
appl
icab
le
Bas
elin
e (c
) – A
t the
con
tract
ing
entit
y le
vel,
the
exis
tenc
e of
ad
min
istra
tive
syst
ems
for p
ublic
pro
cure
men
t ope
ratio
ns, a
nd in
form
atio
n da
taba
ses
to s
uppo
rt m
onito
ring
of p
erfo
rman
ce a
nd re
porti
ng to
and
re
spon
ding
to th
e ne
eds
of o
ther
rela
ted
gove
rnm
ent s
yste
ms
Bas
elin
e (b
) – D
ispu
te re
solu
tion
proc
edur
es a
re in
clud
ed in
the
cont
ract
do
cum
ent p
rovi
ding
for a
n ef
ficie
nt a
nd fa
ir pr
oces
s to
reso
lve
disp
utes
ar
isin
g du
ring
the
perfo
rman
ce o
f the
con
tract
25.0
0%15
.05%
60.2
0%SA
8.00
%2.
80%
35.0
0%P
A0.
250
0.12
51.
00%
0.20
00.
000
0.00
%
0.20
00.
000
0.00
%
0.10
00.
100
0.80
%
0.25
00.
125
1.00
%
5.00
%3.
25%
65.0
0%S
A0.
250
0.25
01.
25%
0.15
00.
150
0.75
%
0.25
00.
250
1.25
%
0.10
00.
000
0.00
%
0.15
00.
000
0.00
%0.
100
0.00
00.
00%
Indi
cato
r 10
– E
ffici
ency
of A
ppea
ls M
echa
nism
Bas
elin
e (d
) – T
he s
yste
m o
pera
tes
in a
fair
man
ner,
with
out
com
es o
f de
cisi
ons
bala
nced
and
just
ified
on
the
basi
s of
ava
ilabl
e in
form
atio
n
Bas
elin
e (e
) – D
ecis
ions
are
pub
lishe
d an
d m
ade
avai
labl
e to
the
publ
ic
Bas
elin
e (f)
– A
dmin
istra
tive
revi
ew b
ody
is s
epar
ate
from
the
regu
lato
ry
body
Bas
elin
e (b
) – D
ecis
ions
are
del
iber
ated
on
the
basi
s of
ava
ilabl
e in
form
atio
n an
d th
e fin
al d
ecis
ion
can
be re
view
ed a
nd ru
led
upon
by
a bo
dy w
ith ju
dici
al c
apac
ity u
nder
the
law
Indi
cato
r 9 –
Effe
ctiv
e C
ontro
l and
Aud
it Sy
stem
Bas
elin
e (a
) – T
he e
xist
ence
and
ope
ratio
n of
a c
ompl
aint
revi
ew s
yste
m
that
giv
es p
artic
ipan
ts in
the
publ
ic p
rocu
rem
ent p
roce
ss a
righ
t to
file
a co
mpl
aint
with
in th
e fra
mew
ork
of a
n ad
min
istra
tive
and
judi
cial
revi
ew
proc
edur
e
Bas
elin
e (c
) – T
he in
tern
al c
ontro
l sys
tem
pro
vide
s tim
ely
info
rmat
ion
on
com
plia
nce
to e
nabl
e m
anag
emen
t act
ion
Bas
elin
e (a
) – A
lega
l fra
mew
ork,
org
aniz
atio
n, p
olic
y an
d pr
oced
ures
for
inte
rnal
and
ext
erna
l con
trol a
nd a
udit
of p
ublic
pro
cure
men
t ope
ratio
ns
exis
ts a
nd o
pera
tes
to p
rovi
de a
func
tioni
ng c
ontro
l fra
mew
ork
Bas
elin
e (d
) – T
he in
tern
al c
ontro
l sys
tem
s ar
e su
ffici
ently
def
ined
to
enab
le p
erfo
rman
ce a
udits
to b
e co
nduc
ted
Bas
elin
e (e
) – A
udito
rs a
re s
uffic
ient
ly in
form
ed a
bout
pro
cure
men
t re
quire
men
ts a
nd c
ontro
ls s
yste
ms
to c
ondu
ct q
ualit
y au
dits
that
co
ntrib
ute
to c
ompl
ianc
e
Bas
elin
e (b
) – E
nfor
cem
ent a
nd fo
llow
-up
on fi
ndin
gs a
nd
reco
mm
enda
tions
of t
he c
ontro
l fra
mew
ork
prov
ide
an e
nviro
nmen
t tha
t fo
ster
s co
mpl
ianc
e
Bas
elin
e (c
) – T
he c
ompl
aint
revi
ew s
yste
m h
as th
e ca
paci
ty to
han
dle
lodg
ed c
ompl
aint
s ef
ficie
ntly
and
a m
eans
to e
nfor
ce th
e re
med
y im
pose
d
Pilla
r IV
- The
Inte
grity
and
Tra
nspa
renc
y of
the
Publ
ic P
rocu
rem
ent S
yste
m
4.00
%2.
00%
50.0
%P
A0.
500
0.25
01.
00%
0.25
00.
125
0.50
%
0.25
00.
125
0.50
%8.
00%
7.00
%87
.50%
FA0.
500
0.50
04.
00%
0.25
00.
125
1.00
%
0.25
00.
250
2.00
%
Gra
nd T
otal
100.
00%
67.8
9%
Bas
elin
e (c
) – S
take
hold
ers
(priv
ate
sect
or a
nd c
ivil
soci
ety)
sup
port
the
crea
tion
of a
pro
cure
men
t mar
ket k
now
n fo
r its
inte
grity
and
eth
ical
be
havi
our
Bas
elin
e (c
) – R
ecor
ds a
re m
aint
aine
d to
val
idat
e da
ta
Indi
cato
r 12
– E
thic
s an
d A
nti-c
orru
ptio
n M
easu
res
Bas
elin
e (a
) – T
he le
gal a
nd re
gula
tory
fram
ewor
k fo
r pro
cure
men
t, in
clud
ing
tend
er a
nd c
ontra
ct d
ocum
ents
, inc
lude
s pr
ovis
ions
add
ress
ing
the
issu
es o
f cor
rupt
ion,
frau
d, c
onfli
ct o
f int
eres
t and
une
thic
al b
ehav
iour
an
d st
ates
act
ions
whi
ch c
an b
e ta
ken
with
rega
rd to
suc
h be
havi
our
(eith
er d
irect
ly o
r by
refe
renc
e to
oth
er la
ws)
Bas
elin
e (b
) – S
peci
al m
easu
res
by th
e go
vern
men
t to
prev
ent a
nd d
etec
t po
tent
ial f
raud
and
cor
rupt
ion
in p
ublic
pro
cure
men
t is
addr
esse
d in
an
anti -
corr
uptio
n pr
ogra
mm
e
Indi
cato
r 11
– D
egre
e of
Acc
ess
to In
form
atio
n
SA
Bas
elin
e (b
) – S
yste
ms
exis
t to
colle
ct k
ey d
ata
rela
ted
to p
erfo
rman
ce o
f th
e pr
ocur
emen
t sys
tem
and
to re
port
regu
larly
Bas
elin
e (a
) – A
cces
s to
info
rmat
ion
is s
uppo
rted
by p
ublic
atio
n an
d di
strib
utio
n of
info
rmat
ion
thro
ugh
avai
labl
e m
edia
with
sup
port
from
in
form
atio
n te
chno
logy
whe
n fe
asib
le
BIS Charts
9 6 .2 4 % 8 0 .0 0 % 9 0 .0 %10 0 .0 0 %
2 2 .5 0 % 2 5 .0 0 %
5 0 .0 0 %
10 0 .0 0 %
3 5 .0 0 %
6 5 .0 0 %
5 0 .0 0 %
8 7 .5 0 %
0 .0 0 %
2 0 .0 0 %
4 0 .0 0 %
6 0 .0 0 %
8 0 .0 0 %
10 0 .0 0 %
Philippines Level of Achievement: BIS Indicators
22.44%
17.90%
12.50%15.05%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
Pillar I (FA) Pillar II (SA) Pillar III (PA) Pillar IV (SA)
Philippines Level of Achievement: BIS Pillars
0
2
4
6
8
10
12
14
16
Indicators
Philippines Level of Achievement: BIS Indicators
Rating 14.44 8 8.1 8 1.8 2.5 5 5 2.8 3.25 2 7
Weight 15 10 9 8 8 10 10 5 8 5 4 8
1 2 3 4 5 6 7 8 9 10 11 12
Appendix 9 - Consolidated Agreed Actions
Indicator
Existence ofinstitutionaldevelopmentcapacity
Specific Weakness
1. Contract award information notavailable and accessible in the existingsystem.
2. Sustainable strategy is not yetdeveloped to provide training adviceand assistance to develop the capacityof government and private sectorparticipants to understand the rules andregulations and how they should beimplemented.
3. Lack of systems and procedures forcollection and monitoring of nationalprocurement statistics in addition to theabsence of a similar system to collectprocurement related data to monitorperformance of agencies.
4. Lack of quality control standards toevaluate performance of staff andaddress capacity development issues.
Current Activities/Actionsto be Undertaken
Issuance of guidelinesreminding all heads ofprocurement entities andBACs to post in G-EPSawards of contract. TSOwill monitor compliance.
a) On-going;implementation of nationaltraining the trainorsprogram for agencies andLGUs.b) On going; medium termapproach to capacitybuilding is to accredit StateUniversities and Colleges,including the NationalDefense College;c) On going; is thedevelopment of long termplan to professionalizeprocurement as a career forpractitioners?d) Not started yet; is privatesector training to beincluded in the trainingprogram.
To be done –a) Develop actualperformance indicators andimplement a system fordata collection andinformation analysis fromcontracting entities up toGPPB;b) Replicate appropriate BISto assess national agenciesand LGUs, as managementtool.
To be done – include settingup of quality controlstandards to evaluate staffperformance and addresscapacity developmentissues in theprofessionalization programmentioned in No. 2(c).
Responsible Agencies,Funding and Timetable
GPPB -TSO
GPPB, SUCs, Group ofCSOs
GPPB
GPPB-TSO
GPPB
Matrix of Weaknesses and Targeted Activities (as of November 2004)
Indicator
Efficientprocurementoperation andpractice
Specific Weakness
5. At the contracting entity level, thelevel of procurement competenceamong government officials within theentity is not yet consistent with theirprocurement responsibilities.
6. At the contracting entity level, theprocurement training and informationprograms implemented for governmentofficials, as well as for private sectorparticipants is not yet consistent withdemand.
7. While administrative systems existat the contracting entity level, they donot adequately support monitoringprocurement performance in mostagencies.
Current Activities/Actionsto be Undertaken
a) Link to No. 2.b) To be done – conduct oftraining program to improveof skills in estimating pricesand analyzing bidvariances.c) To be done as follow-upto Value Engineering (VE)Briefings which are: (i) toenhance capacity for valueengineering focusing moreon upstream reviews; (ii)issuance of guidelines toagencies for the use ofvalue engineering.
a) On-going; should belinked to No. 2. Expansionof the training should bedone to meet demands.b) To be done – the trainingprogram should include theprivate sector and the civilsociety observers.
a) Link to No. 3.b) On-going; developmentof G-EPS will provide online information oncommonly used suppliesprocurement such as prices,contracts performance, etc.c) To be done – collection oftechnical specifications onnon-commonly usedsupplies such drugs, etc.,catalogue and disseminateon line.d) To be done – stand alonestudy on comparison of bidprices for commonprocurement items, such asclassrooms, medicalsupplies, water supply andbooks procured by selectedagencies.e) On-going;implementation of E-Procurement as atransactional tool.
Responsible Agencies,Funding and Timetable
GPPB
GPPB
a) GPPBb) GPPB, PS (September2005)
c) GPPB, PS (funding byEU)
d) GPPB, COA, G-Watch, byJune 2005, funding by WB-IDF.
e) GPPB, PS by September2005 with possible fundingfrom ADB.f) GPPB, BSP, IC, DOF andWB.
Matrix of Weaknesses and Targeted Activities (as of November 2004)
Indicator
Functionality ofthe PublicProcurementMarket
Specific Weakness
8. Inadequate internal controlmechanisms for undertakingprocurement operations at thecontracting level.
9. The participation rate of tenderers inresponse to competitive tenderinvitations is not consistent with thecapacity of the marketplace. Thereason is that political interventionsdistort competition and participationrate. A number of private sectorcompanies are not participating.
Current Activities/Actionsto be Undertaken
f) To be done as follow-upto recommendations in theSecurity Report: (i) discussprocurement securityrelevance with BSP andInsurance Commission, and(ii) issue guidelines onselective reputable suretycompanies.
a) To be done –implementation ofProcurement Manual in allagencies and harmonizationwith donors.b) To be done – (i)strengthen the internalcontrol mechanism atagency level by: enforcingthe law that mandatescreation of internal auditunits; (ii) prepare internalaudit manual onprocurement; and (iii)implementation of a trainingprogram for internalauditors.
a) To be done – ntensiveinformation disseminationand familiarization on thenew law to the privatesector and civil society tobring trust and confidencein the new system.b) To be done – support toprivate sector initiatives ontrainings on the newsystem.c) To be done – includeprivate learning institutionsin accreditation ofprocurement traininginstitutes to cater to privatedemand.d) To be done – issuanceof a policy thatadvertisements shouldinclude key evaluationcriteria.
Responsible Agencies,Funding and Timetable
f) GPPB, BSP, IC, DOF andWB.
a) GPPBProcurement Manual to beissued in January 2005; Pilottesting in 6 agencies;
b) January 2005 (Prepare forpossible IDF funding).
GPPB
Matrix of Weaknesses and Targeted Activities (as of November 2004)
Indicator
Effective controland AuditSystem
Degree ofaccess toinformation
Specific Weakness
10. Lack of enforcement and follow-upon findings and recommendations fromthe control framework.
11. The internal control system ofagencies does not provide timelyinformation on compliance to enablemanagement action.
12. While the law requires publicationin the G-EPS, websites andnewspapers, the full access toinformation by the civil society is notyet fully institutionalized.
13. Some agencies and LGUs are notmaintaining records to validate data.
Current Activities/Actionsto be Undertaken
a) On-going; implement theGuidelines for Suspensionand Blacklisting of Bidders,Suppliers and Constructors.b) To be done – strengthenthe role of Presidential Anti-Graft Commission inensuring that procurementaudit is institutionalizedthrough the internal auditunits of each agency.Training on fraudexamination and audit.c) To be done – (i) COAshould include as part of itsAnnual Report anassessment of adequacy ofinternal control mechanismin weak agencies; and, (ii)training of investigators onfraud examination andaudit.d) To be done – provideactive assistance toOmbudsman for successfulprosecution of procurementcases.
To be done – agenciesshould institute adequateinternal control mechanismto ensure that timelyinformation are provided toagency management. Linkto No. 10.
a) On going. Support toPWI in improving trainingdesign and delivery for BACcivil society observers(CSOs).b) To be done – informationsupport system for trainedBAC CSOs.
To be done – issuance ofguidelines for proper recordmanagement for nationalagencies and LGUs.Prepare the TOR and hireconsultant.
Responsible Agencies,Funding and Timetable
a) GPPB
b) PAGC, COA
c) COA, OMB
d) PAGC
PAGC, COA
a) GPPB
b) OMB, COA
GPPB
Matrix of Weaknesses and Targeted Activities (as of November 2004)
Appendix 10 - Annex to the Procurement Schedule of Loan Agreement
1. Eligibility screening shall not be applied. However, bids that do not contain any of the followingdocuments will not pass the documentary compliance check: (a) evidence of the required financial,technical or production capability; (b) audited financial statements; (c) credit line, or cash depositcertificate; (d) bid security; and (e) authority of the bid signatory.
2. In the case of prequalification, if any bidder is denied access to the bidding process for reasonsunrelated to its financial and technical qualifications to perform the contract, prior concurrence ofthe Bank shall be sought.
3. A ceiling maybe applied to bid prices, with prior concurrence of the Bank in advance of bidding.However, the Approved Budget Estimate maybe disclosed in the advertisement or in the biddingdocuments.
4. Domestic or regional preferences will not be applied in the evaluation of bids, and other preferencesin effect in the Philippines will not be used except with the prior concurrence of the Bank.
5. Suppliers and contractors will not be required to purchase only local goods or supplies or materials.
6. In case of contracts for prior review, modifications exceeding 15% of contract amount and materialchanges in the conditions during implementation require prior Bank concurrence.
7. Foreign suppliers and contractors shall be allowed to participate, if interested, without first beingrequired to associate with, or enter into joint venture with, local firms. Moreover, foreign biddersshall be allowed to bid, even without registration, licensing, and other government authorizations,leaving these requirements for after award and before signing of contract.
8. For works contract, the experience qualification requirement shall be: (a) at least one previouscontract at 80% of the estimated cost of the contract being procured; and (b) an annual turnoverfrom all works averaged over the last three years equal to 100% of the estimated cost of the contractbeing procured.
79COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Overview
Following the completion of the Country ProcurementAssessment Report in June 2002, which was publishedin March 2003, there has been a great deal of progressin pushing procurement reform in the Philippines. ThisCPAR Update was undertaken in November-December2003 to take stock of achievements so far, and to reviewthe priorities for further action in procurement reform.
Discussions were held between the World Bank andthe Government in November 2003 to review the statusof actions identified in the first CPAR which wererecommended and taken, and to discussrecommendations for future actions to carry forwardthe reform process. The Japan Bank for InternationalCooperation (JBIC) and the Asian Development Bank(ADB) also joined key meetings. The Bank MissionTeam met with other key stakeholders such as theCouncil of Engineering Consultants of the Philippines,the Philippine Contractors Association, ProcurementWatch, Incorporated and the Philippine Center forInvestigative Journalism. The list of participants to theMission and persons met by the Mission Team ispresented in Appendix 1 (see the CPAR Update). In awrap-up meeting held on December 11, 2003, the keyfindings and recommendations were discussed with theGovernment Procurement Policy Board (GPPB)chaired by Secretary Boncodin.
Big Progress in Procurement Reform
Laudable achievements have been made in theGovernment’s agenda for procurement reform in thepast year, as follows:
Passage and promulgation of the Government Pro-curement Reform Act (GPRA) on January 10, 2003(Republic Act No. 9184). The Law consolidates
the more than sixty laws pertaining to public pro-curement and institutionalizes transparency mea-sures including the use of electronic procurementand the participation of Civil Society Organiza-tions. The Law covers all national agencies, gov-ernment owned and controlled corporations, allgovernment entities and instrumentalities.The inclusion of all Local Government Units inthe coverage of the Government ProcurementReform Act.The issuance of Implementing Rules and Regula-tions (IRRs) for the Law on October 8, 2003.The creation of the Government ProcurementPolicy Board vested with sole authority to overseeprocurement reform and protect the national inter-est in all matters affecting public procurement. ATechnical Support Office was created by the Imple-menting Rules and Regulations to undertake theday-to-day operations of the GPPB in the perfor-mance of its duties and responsibilities in policymaking, monitoring compliance, and training andadvocacy.Mandatory use of the Government Electronic Pro-curement System (G-EPS) for the procurement ofcommon supplies and to promote transparency andefficiency through the establishment of a centralgovernment procurement web site to be the primarysource of information on all government procure-ment transactions. Initially, this has involved theposting of bid invitations and awards in the pro-curement web site.The monitoring and enforcement of procurementrules as well as ensuring efficiency and effective-ness for each step of the procurement processthrough procurement audit.The provision of penal sanctions against violatorsof the Law, and its rules and regulations.The development of a procurement manual and
Appendix 11 - CPAR Update February 2004 (without Appendices)
80COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
Review of the June 2002 CPARAgenda
The CPAR was a comprehensive document that coveredthe entire public procurement system of the countryplus an in-depth study of three sectors: Public Works,Education and Health. It contained fiftyrecommendations and agreed actions. Responsiblegovernment agencies reported on the status ofcompletion of each agreed action. These agreed actionswere classified into (a) national and local governments,and (b) the three sectors. The detailed statusarepresented in Appendix 2 (see the CPAR Update).Most of the recommendations have either beencompleted (58%) or are on-going (26%). The data inTable 1 provides an overview.
Some activities that are still to be completed relateto:
Professionalization of the procurement function;Corporatization of procurement services;Study on securities and bank guarantee;Streamline and reducing delay in registration andlicensing procedures;Establishment of record keeping systems at theLGU level; andEligibility of textbooks with foreign authors(Science, Math and English).
Emerging Issues/Priorities
Several new issues emerged which were not includedin the June 2002 CPAR. These arose from ongoingdiscussions with government, and issues that arose fromthe completed activities. For example:
Some key priorities identified by Governmentinclude the apparent high cost of some works andgoods procured by Government and the eligibilityof Philippine firms to compete for internationallyfinanced contracts;It was also noted that government has madeconsiderable progress in electronic procurementsystems and further development now needs to bepursued; and,With the passage of the new Law, issuance of theImplementing Rules and Regulations andcompletion of harmonized bid documents, a majorchallenge is to disseminate the new rules andprocedures, and provide training at all levelsincluding local government units, the private sectorand in civil society.
The focus of the CPAR Update therefore is on newactivities to achieve these objectives. Discussions wereheld on how to implement funding requirements and toexplore possible opportunities for partnerships withinternational organizations. There was a strong senseof commitment among the various organizations towork together to follow-up on the strong momentumfor procurement reform–to achieve better governanceand better value for money for public spending in thePhilippines. Some of these partnerships are reflectedin the joint responsibilities shown in the matrix inAppendix 3. Important priorities that were identifiedare:
Disseminate information on Government Procure-ment Reform Act/Implementing Rules and Regu
National/Local Levels 15 7 5 27Sectoral Levels 14 5 4 23
29 12 9 50
Completed On-Going Open TOTAL
Table 1: Status of Recommendations in the March2003 CPAR
standard bidding documents and forms (harmo-nized with thosse of the major international financ-ing institutions: World Bank, ADB and JBIC) tofacilitate compliance with the new law.
81COUNTRY PROCUREMENT ASSESSMENT REPORT 2ND UPDATE
lations to all stakeholders including local govern-ments, the private sector and civil society;Implement E-Procurement as a transactional tool;Preparation of a report on capacity, quality and sizeof contracts for works;Training on harmonized bidding documents at alllevels including national agencies, local govern-ments, the private sector and civil society;Introduce a system of value engineering analysison a pilot basis to check that designs and cost esti-mates ensure best value for money;Pilot “design and build” procurement schemes inat least one contract; andCapacity Building of Civil Society Organizations(CSOs).
Discussions with the PrivateSector
The discussions with the Philippines ContractorsAssociation and the Council of Engineering Consultantsof Philippines (CECOPHIL) indicated some positiveelements in the introduction of the GPRA and IRRs.The discussions disclosed some serious concernsrelating to:
Qualification criteria for short listing of consult-ants and contractors, especially under contractsfunded by International Financing Institutions;Transparency of the pre-qualification/eligibility andevaluation processes;Lack of interest of contractors to participate in pro-vincial procurement as a result of provincial pref-erence provisions;Capacity building of Civil Society Organizationswith extended participation as observers in the Bidsand Awards Committees;Adjustment of prices of contracts with long comple-tion periods;
No clear mechanism in submitting a legitimate pro-test; andHiring only of international firms as coordinatingconsultants.
These are legitimate concerns, which need to beaddressed in the on-going efforts of the government toensure an efficient, transparent and open competitiveprocess, however, it appears that almost all of theseissues had been addressed in the Law and in theImplementing Rules and Regulations. Further, someof them are likewise considered in the procurementmanuals and harmonized bidding documents. Whatappears to be lacking is the dissemination of informationand training of the private sector and civil society. Theseactivities are included in the emerging issues/prioritiespresented in Appendix 3 (see the CPAR Update).
Meeting with GPPB and NextSteps
In a meeting held on December 11, 2003, the GPPBand the Bank agreed on the following next steps:
Appointment of the new Executive Director ofTSO-GPPB soonest. The new TSO Executive Di-rector is on board.Issuance of harmonized bid documents with neces-sary forms.Responsible Agencies will implement agreed ac-tions on dates specified. Progress will be monitoredjointly by the TSO-GPPB and the World Bank.International partners will make the promised as-sistance available. A request for ASEM 2 funds isbeing processed internally by the World Bank.GPPB will discuss with other donors possible as-sistance.Finalize World Bank Procurement Side Letter. TheTSO-GPPB, DOF and NEDA representatives willstart discussing the draft Side Letter, included asAppendix 4 (see the CPAR Update).
.
UPDATE2nd
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