THE Procurement Service (PS) of the Department of Budget and Management is getting heat from government auditors following a discovery that it accepted the delivery of mechanical ventilators in 2021 despite the absence of backup rechargeable batteries as required in the P630 million contract.
The Commission on Audit said the failure of supplier Saviour Medevices, Inc. to provide batteries for the ventilators should have been sufficient ground for the PS to cancel the contract. Instead, the agency agreed to dispense with the specification for a battery and accepted the items delivered despite being incomplete.
According to the Bids and Awards Committee (BAC) of the PS, the catalog submitted by the supplier was the one it accepted for price analysis and also used by the agency’s Technical Working Group (TWG) for its review and evaluation.
The item catalog showed that the ventilator model offered to the PS “has a battery life of three hours” despite having a compressor as an option to allow the use for 24 hours in the absence of air from a central source.
But neither the BAC nor the TWG required the supplier to provide a sample equipment for testing.
Under the contract, Saviour is required to deliver 750 mechanical ventilators for a total contract price of P630 million.
Upon delivery of the first batch of ventilators, PS personnel found that the supplier failed to include a backup battery as alternative power supply prompting the issuance of a rejection notice.
Auditors noted that in its letter justifying the absence of batteries, Saviour said that due to their size, the ventilators “are impractical to be powered with batteries” assuring the agency that even during power outages, the ventilators can continue working for three hours provided that they remain connected to the hospital’s compressed gas pipelines or has a separate gas tank supply.
The COA said the letter is an “implied admission” by the supplier that its product did not have a rechargeable back-up battery that can power up a medical air compressor — a technical specification for the ventilators.
More puzzling for the audit team was the decision of the PS to eventually accept the ventilators without the backup batteries.
It said an officer-in-charge (OIC) of the Operations Group of the PS endorsed the request for reconsideration by the supplier to the Department of Health (DOH).
“In its reply letter, the Undersecretary of Health gave favorable recommendation to the request for reconsideration which found the justification of the supplier acceptable,” the audit team noted.
The decision cited “the urgent need for mechanical ventilators” because of the COVID-19 pandemic.
The COA found the explanation inadequate insisting that it was the job of the PS to ensure that the supplier fulfill the requirements in the government contract.
“The fact that the procurement at hand is an emergency procurement does not give the occasion for the BAC to accept product literatures submitted by the bidder at face value,” it pointed out.
The audit team also emphasized that there were other suppliers who offered ventilators equipped with air compressors at much lower cost during the market survey.
Most importantly, it pointed out that the backup batteries were required to provide additional safety margins for patients using them when hospitals suffer a power failure.
“In cases of power outages at the hospitals, it is imperative that the mechanical ventilators continue to operate through a back-up battery, precisely because mechanical ventilators provide support for patients with respiratory issues,” the auditors said.
Commenting on the audit findings, the PS management invoked “extraordinary times” saying it had to make hard choices due to the restrictions under a global health crisis.
“These medical supplies were procured amidst shifting quarantine classifications, community lockdowns, shifting work arrangements, and persisting effects brought about by COVID-19. Thus, it is important to take into consideration that existing rules and regulations maybe very difficult to implement considering the unpredictable and constantly changing situations,” the agency said.
