THE Commission on Audit (CoA) has raised questions about the selection process adopted by the Metropolitan Waterworks and Sewerage System (MWSS) for the contractor of the New Centennial Water Source- Kaliwa Dam Project.
In an audit memorandum dated June 10, CoA noted that the three contractors approved by the technical working group were: Consortium of Guangdong Foreign Construction Company Ltd and Guangdong Yuantian Engineering Co.; Power Construction Corp. of China Ltd; and China Energy Engineering Corp. Ltd (CEEC).
CoA found that one of the shortlisted cadindates did not have the required permits, while another did not submit a bid within the project budget.
“However, during the opening of bids and in the evaluation of minimum Eligibility Requirements of the contractors, Consortium of Guangdong Foreign Construction Co. Ltd. was found to be non-complying,” CoA said.
The consortium was found to lack a mayor’s and business permit, Philippine Contractors Accreditation Board (PCAB) license, Philippine Government Electronic Procurement System (PhilGEPS) Platinum Certificate, and a validated Single Largest Completed Contract (SLCC).
Power Construction Corp. of China also submitted a bid of P13.042 billion which is higher than the approved budget for the contract by P842 million.
“As a result, only China Energy Engineering Corp. Ltd qualified which is questionable considering that the two bidders were disqualified in the 1st and 2nd stages of the process due to the seemingly intentional purpose of the bidders not to comply with the TWG (technical working group) requirements,” CoA said.
Projects funded by foreign aid are typically nominated by the donor country’s government, from which the Philippines is free to select.
CoA said the two bidders were only included to comply with the Procurement Law’s three-bidder requirement.
It also found that the winning contractor CEEC conducted preliminary project activities despite the non-effectivity of the Loan Agreement and as provided under the Mobilization Schedule of the Contract Agreement.
“The contract agreement between the MWSS and CEEC expressly provides that the winning contractor shall only begin mobilization by conducting topographic mapping and geologic drilling after the receipt of Notice to Proceed,” CoA said.
“The MWSS cannot assume any liability in case the loan agreement is not perfected nor declared effective. Thus, the contractor shall bear all the risk of loss and damages, if any, as a result of its actions,” it added.
CoA recommended that the MWSS explain the acceptance of the two other bidders despite non-compliance with the vetting/pre-qualification requirements.
CoA also recommended that MWSS ensure that the contractor complies with the contract, which rules out conducting any preliminary project activities.
The P12.1 billion Kaliwa dam will be built along the Kaliwa River in the towns of General Nakar and Infanta, Quezon province. It is expected to provide 600 million liters per day (MLD), adding to the current supply to Metro Manila of 4,132 MLD. — Vince Angelo C. Ferreras
