THE Commission on Audit has urged the Philippine Health Insurance Corporation (PhilHealth) to step up plans to construct its own office building which has been shelved for the past 17 years shortly after the purchase of a 1.72-hectare lot on East Avenue, Diliman, Quezon City from the Bangko Sentral ng Pilipinas (BSP).
State auditors said the PhilHealth had already spent P1.062 billion on lease of office spaces, warehouse, and venue for its head office between 2009 to 2020.
From 2021 to 2025, the audit team said the agency will have to cough up another P811.74 million on rental expenses, including more than P100 million each year by the head office alone, bringing the total to P1.874 billion.
“This sizeable amount could have been utilized to fund other important projects had the construction of PhilHealth’s own building materialized,” the COA said.
Records showed PhilHealth acquired the BSP property for P439.38 million on April 13, 2003 followed by the creation of a Project Management Team (PMT) for Infrastructure Projects in September of the same year.
The PMT was later renamed as the PhilHealth Project Management Committee and tasked to facilitate procurement of services relative to the construction of the PhilHealth Corporate Center (PCC).
However, the project was bogged down by disputes with contractor hired to do the design, resolving a right-of-way issue, and budgetary adjustments.
In November 2011, the Physical Resource and Infrastructure Department informed the PhilHealth president that the original approved budget of P1.2 billion is “no longer realistic” due to the increase in the costs of labor and materials. A revised budget of P2.67 billion or more than double the original sum was set.
In 2015, the Department of Public Works and Highways was requested for technical assistance in implementing the project but it remained only on paper.
PhilHealth said that in September 2020, its president Dante Gierran received an unsolicited proposal from a private contractor for the design and construction of its main office.
Further inquiry revealed that PhilHealth could not finalize the mode of procurement due to the recurring changes of leadership in the top Management and the composition of the BOD (Board of Directors).
