THE Department of Information and Communications Technology (DICT), the government’s lead agency in matters related to ICT policies and cybercrime, purchased 1,000 laptop computers, 26,500 tablets, and 1,001 pocket wifi worth P170 million from a firm listed by the Bureau of Internal Revenue (BIR) as engaged in “general construction.”
If that is not tough enough to explain, government auditors also found that the supplier, a sole proprietorship under the trade name Lex-Mar General Merchandise and Contractor, had current assets listed at only P44,578,450 as of December 2019.
This means it landed a contract almost four times its value.
Based on records, the laptop computers were distributed to public school teachers in San Juan City while the tablets went to students in the cities of Makati and San Juan.
Why these two cities, both very affluent on their own, were chosen as beneficiaries was not explained.
However, the Commission on Audit noted that, from the outset, the transaction was outside the agency’s mandate limited to “formulating and implementing policies and initiatives.” It stressed this does not include providing, buying, and giving out gadgets.
“While we sympathize with the plight of learners and teachers in this time of distance learning or online classes, a donation of government property, such as in this case, may be considered as illegal expenditure,” the COA pointed out.
A review of Lex-Mar’s financial statements also showed its operating expenses do not include an entry under “salaries expense,” which prompted the COA to ask how it can provide the required technical support, online help, hotline service, and offline service center as provided in the purchase orders.
Worse, the trader’s BIR Certificate of Registration and Permit to Operate did not show that it is in the business of supplying ICT devices.
“It is doubtful whether the herein supplier has the legal capacity to engage in this kind of business. It was not shown that Lex-Mar has available employees which may show that it is technically capable to comply with the requirements of the project,” the audit team said.
The procurement was done in three separate contracts all under negotiated procurement — emergency cases (NP-EC) which means none underwent competitive public bidding.
The DICT said the transactions were all for the “accelerated implementation” of its “pilot project for Digital Learners and Digital Teachers” and claimed it is part of the government’s response to a “public health emergency due to COVID-19.”
It cited Department Circular (DC) No. 12-A issued on June 16, 2020 and DC No. 12-B dated June 17, 2020 as basis for the transactions.
The first purchase was for the sum of P50.773 million involving 1,000 laptops (P40,600 each), 1,500 tablets (P4,780 each), and 1,001 pocket wifi (P3,000 each).
Under the column Intended Beneficiaries the DICT identified “learners and teachers from Pinaglabanan Elementary School, San Juan City.”
The second and third purchases involved 6,250 tablets (P4,780 each) totaling P29.875 million and 18,750 tablets (P4,780 each) amounting to P89.625 million. Both were earmarked for the “City Governments of San Juan and Makati.”
Auditors demanded submission of proof that Lex-Mar had previously engaged in the trade of supplying gadgets, including a certificate of exclusive distributorship or a Statement of Single Largest Contract showing it had handled any transactions similar to the P170 million DICT project.
As for the DICT, the COA required the agency to show that its chosen supplier had the technical, legal and financial capacity to undertake the project and an explanation why it was selected and awarded the contract.
