COA wants Nat’l Print­ing Of­fice to re­fund P139M in il­le­gal printer rentals

Watchmen Daily Journal - - NATION - Buan, Rap­pler.com) (Lian

MANILA – The Com­mis­sion on Au­dit (COA) de­manded the re­fund of P139.46 mil­lion in rentals paid by the Na­tional Print­ing Of­fice (NPO) to pri­vate print­ers in what were found as il­le­gal lease agree­ments.

In a no­tice of dis­al­lowance dated Septem­ber 6, 2018, COA said 294 dis­burse­ment vouch­ers worth P139.46 mil­lion which were paid to 12 pri­vate print­ers vi­o­lated pro­cure­ment rules.

"Records of the trans­ac­tions, upon ex­am­i­na­tion and re­view, dis­closed that the pay­ments made to the pri­vate print­ers un­der sub­con­tract­ing is ir­reg­u­lar, in vi­o­la­tion of Sec­tion 4.6 of the Govern­ment Pro­cure­ment Pol­icy Board," COA said.

State au­di­tors held NPO Di­rec­tor Fran­cisco Vales Jr. li­able for the dis­al­lowed trans­ac­tions, as well as the fol­low­ing:

● Winifredo Talla of the fi­nan­cial man­age­ment di­vi­sion

● Bue­naven­tura Gon­za­les Jr. and Ruben Dan­cel of the pro­duc­tion, plan­ning, and con­trol di­vi­sion

● Leah dela Cruz of the bud­get sec­tion

The 12 pri­vate print­ing com­pa­nies were also held li­able.

COA said the NPO has not yet com­plied with or ap­pealed the dis­al­lowance, as it has six months to re­spond to the no­tice.

Ques­tion­able lease agree­ments were re­port­edly the cause of "en masse res­ig­na­tion" in Novem­ber 2016. Ex­change of let­ters posted on the NPO web­site point to con­flict among some NPO of­fi­cials, with Vales al­legedly putting "too much pres­sure" on the dis­grun­tled of­fi­cials for the lease con­tracts to be signed.

Vales was a for­mer Davao City of­fi­cial.

The Pres­i­den­tial Com­mu­ni­ca­tions Op­er­a­tions Of­fice, where the NPO is an at­tached agency, started an in­ves­ti­ga­tion as early as Novem­ber 2016.

Il­le­gal con­tracts

The dis­al­lowed con­tracts are for the fol­low­ing pri­vate print­ers, all for the 1st quar­ter of 2017:

* Ad­vance Com­puter Forms In­cor­po­rated P2.4 mil­lion

* Best­forms In­cor­po­rated - P9.3 mil­lion * Con­sol­i­dated Pa­per Prod­ucts In­cor­po­rated P49,542

* East­land Print Ink In­cor­po­rated - P6.8 mil­lion

* Holy Fam­ily Print­ing Cor­po­ra­tion - P38 mil­lion * JI Print­ers In­cor­po­rated - P12.7 mil­lion

* Mer­cury In­ter­na­tional Se­cu­rity Print­ing Cor­po­ra­tion - P4 mil­lion * Metro­color Cor­po­ra­tion - P1.5 mil­lion

* Nova Busi­ness Sys­tems In­cor­po­rated - P28.5 mil­lion

* Tone Guide Press In­cor­po­rated - P1.9 mil­lion

* Triprint Cor­po­ra­tion P8.7 mil­lion

* West­ern Visayas Print­ing Cor­po­ra­tion - P25.5 mil­lion

Ac­cord­ing to the 2017 au­dit re­port on the NPO, there was no valid le­gal ba­sis to en­ter into joint ven­ture agree­ments with the pri­vate print­ers.

State au­di­tors said the Na­tional Eco­nomic and Devel­op­ment Author­ity (NEDA) only al­lows joint ven­ture frame­work agree­ments (JVFAs) with govern­ment owned or con­trolled cor­po­ra­tions, "which the NPO does not be­long to," ac­cord­ing to COA.

COA said that in­stead of com­ing up with plans and pro­grams so the NPO could ac­quire ma­chines for the print­ing needs of the govern­ment, it in­stead con­tin­ued to pay mil­lions of pe­sos to pri­vate print­ers.

COA pointed out that un­der pro­cure­ment rules, when govern­ment print­ers can­not ac­com­mo­date or­ders, the NPO can "en­gage the ser­vices of pri­vate print­ers" but it can­not "sub­con­tract" them.

State au­di­tors found that of the P139.46 mil­lion in print­ing ex­penses, the NPO only earned 15%, which re­sulted in a loss of in­come for the agency.

"This is so be­cause all project costs were ex­pended by the pri­vate print­ers; thus, tan­ta­mount to sub­con­tract­ing," COA said.

As of De­cem­ber 30, 2017, COA also said P3.7 mil­lion worth of penal­ties have been in­curred be­cause of late de­liv­er­ies due to the sub­con­tract­ing.

Calling it a "scheme," au­di­tors said the con­tracts re­sulted in er­rors in fi­nan­cial state­ments, and ex­posed of­fi­cials to lit­i­ga­tion.

The NPO told COA dur­ing its exit in­ter­view that a spe­cial fund al­lowed the agency to en­ter into lease agree­ments. The NPO ex­plained that be­cause it has spe­cial funds, it is cat­e­go­rized among govern­ment in­stru­men­tal­i­ties with cor­po­rate pow­ers and/ or govern­ment cor­po­rate en­ti­ties, which are al­lowed by NEDA to en­ter into JVFAs.

But COA dis­agreed and pro­ceeded to is­sue a no­tice of dis­al­lowance, say­ing that "the man­dates of NPO are not be­ing re­al­ized as NPO is not able to pro­vide ma­jor­ity of the print­ing ser­vices needed by govern­ment agen­cies and in­stru­men­tal­i­ties."

(Photo from the NPO web­site)

The Na­tional Print­ing Of­fice is­sued a no­tice of dis­al­lowance for P139 mil­lion worth of printer rentals.

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