ASEANEWS HEADLINE | MANILA: Top contractors no-show at Senate flood control probe
8 of 15 flood control project contractors ‘no show’ to Senate’s ‘PH under Water’ hearing | ANC
ANC Live: The Philippine Senate Blue Ribbon Committee begins its hearing on flood control projects on Tuesday (August 19) titled “Philippines Under Water.”
MANILA, Philippines — The Senate will subpoena the owners of the top 15 contractors who cornered the lion’s share of flood control projects under the Marcos administration, after more than half of them skipped yesterday’s Blue Ribbon committee hearing on project anomalies.
Only seven of the companies sent representatives to the Blue Ribbon hearing yesterday, prompting the committee to approve a motion to subpoena the owners of the 15 firms to compel them to attend the next hearing.
Only four companies were represented by their owners: Legacy Construction Corp. president Alex Abelido, QM Builders owner Allan Quirante, EGC Construction owner Ernie Baggao and Triple 8 Construction owner Wilfredo Natividad.
Among those who did not show up at yesterday’s hearing was defeated Pasig mayoral candidate Sarah Discaya, who sent an excuse letter citing prior commitment. She was supposed to represent Alpha and Omega Gen. Contractor & Development Corp.
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Apart from her, Roma Rimando of St. Timothy Construction Corp. also skipped the meeting, claiming she was still mourning the death of a foster parent.
Some of the contractors cited various reasons for their absence, such as medical procedures and overseas trip, while the others never replied to the Senate’s invitation.
“I hope this is not a sign of disinterest on their part because this meeting was called precisely to get to the bottom of this problem,” Blue Ribbon chairman Sen. Rodante Marcoleta said.
Sen. Erwin Tulfo lambasted the owners who did not attend the hearing, saying their excuses were flimsy.
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“They’re making a fool out of this committee by claiming they’re sick, on vacation, with prior schedule. What’s important, a prior schedule or an investigation where we’re talking of P544 billion? No small change,” Tulfo said.
Undercapitalized
Brought up at the hearing were “suspected” ghost flood control projects awarded to contractors, many undercapitalized with just P250,000 to P1 million in paid-up capital but were able to bag billions of pesos in contracts for flood control works in just three years.
Sen. Sherwin Gatchalian said one of the contractors, MG Samidan Construction, only had a P250,000 paid-up capital but managed to get 58 projects worth P5.02 billion.
Another top 15 contractor, QM Builders, has a P1.25-million paid-up capital but won 93 projects worth P7.38 billion.
Gatchalian cited the Philippine Contractors Accreditation Board as saying that a contractor must be worth at least P1 billion to be qualified for contracts worth P450 million and above.
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Giving undercapitalized corporations big ticket projects would surely result in substandard flood control infrastructure, he added.
“The Department of Public Works and Highways (DPWH) is awarding contracts to undercapitalized corporations. If a corporation is undercapitalized, and they scrimped on the projects, obviously they are doomed to fail,” Gatchalian said.
Public Works Secretary Manuel Bonoan said contracts are awarded to companies based on their technical capabilities and Net Financial Contracting Capacity (NFCC) and not so much on their paid-up capital.
QM Builders’ Quirante said his company has a P40-billion NFCC and more than P2 billion worth of assets, making it qualified to bid for contracts of up to P40 billion.
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The other undercapitalized companies which bagged big ticket projects are: Centerways Construction and Development Corp. with P1.25-million paid-up capital upon incorporation and P45-million latest paid-up capital, but with 83 projects worth P5.1 billion; Triple 8 Construction and Supply Inc. with P5-million paid-up incorporation capital and P90-million latest paid-up capital, with 57 projects worth P3.91 billion; – Wawao Builders with P50-million paid-up capital but with 58 projects worth P4.2 billion.
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Not flood prone
Senators also questioned the implementation of flood control projects in provinces that are not among the top 10 flood prone provinces.
The top 10 flood prone provinces are Pampanga, Nueva Ecija, Pangasinan, Tarlac, Bulacan, Metro Manila, Maguindanao, North Cotabato, Oriental Mindoro, and Ilocos Norte.
Based on the Sumbong sa Pangulo database analyzed by The STAR, Cebu-based QM Builders implemented flood control projects mostly in Cebu and some in Negros Oriental. MG Samidan had river basin and flood control projects in La Union. Centerways implemented projects in Albay. None of these provinces are in the top flood prone list.
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Replying to a query from Marcoleta, Bonoan said the department’s field officers were still validating the projects but conceded that “there seems to be some ghost projects as reported in Bulacan.” Information from the DPWH showed that there are 668 flood control projects in Bulacan.
Marcoleta said Wawao Builders cornered about P9 billion worth of flood control projects nationwide, the lion’s share of which are in the three territories in Bulacan – pegged at P5.971 billion.
Bonoan admitted that contractors in Bulacan flood control projects already received payment after the completion of the projects.
Senate Minority Leader Vicente Sotto III questioned Bonoan on how Wawao Builders was able to corner P5.9 billion worth of projects and who could have been responsible for inserting the contracts in the DPWH budget. The DPWH chief could not answer.
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Sen. Raffy Tulfo, meanwhile, questioned why blacklisted companies were still allowed to bid for flood control projects. He said that based on his research, only one of the 103 blacklisted contractors was blacklisted for flood control projects by the DPWH. “Why only one? It’s long been an issue, but why only one was flagged?”
Bonoan explained that the authorization for blacklisted contractors to take part in projects is still being validated.
“So if there’s no derogatory information that would come out in the bidding process, they could be allowed to participate in the bidding,” he said.
Tulfo remarked that most DPWH employees were themselves contractors. “So they make their own ghost projects and they don’t blacklist themselves,” Tulfo said.
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Tulfo named DPWH regional director Gerald Pacanan as being behind a “chop chop” modus of earning kickbacks from flood control projects in Region IV-B. Pacanan was not invited in the hearing.
Marcoleta, meanwhile, urged the DPWH to look into several companies beyond the Top 15 cited by President Marcos, such as 11-16 Construction, Ferdstar Builders, Northern Builders, AC Soliven Construction, AL Salazar Construction and RA Pahati.
“Take note of this and let’s help one another dig this up. Even if they’re now ghosts, I’m sure there are skeletal remains that we can examine in the next hearing that can help us determine how much the government is really losing,” he said in Filipino.
As the Senate Blue Ribbon committee proceeds with its investigation, Baguio City Mayor Benjamin Magalong said he is willing to share information with the Senate or with the House of Representatives, although neither of the two chambers has invited him to shed light on the issue.
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“Whatever they ask of me, I will give them,” he said in Filipino. He added he is also hoping to be invited by President Marcos so he can personally discuss in detail his knowledge of anomalies in infrastructure projects involving officials and lawmakers.
Isabela wants more projects
With most of flood control projects appearing to be in Bulacan, Isabela Gov. Rodito Albano said his province and neighboring Cagayan should be given priority as the Cagayan River and its tributaries are among the country’s largest waterways.
In an interview on One News’ “Storycon,” Albano said he was surprised that Cagayan was not included in the list of provinces that received major flood control funding.
“Instead of being number three, we should have been number one. Flood control should really be for Isabela and Cagayan. I’m wondering why Cagayan wasn’t on the list,” he said in Filipino.
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Albano stressed that the Cagayan River runs through Nueva Vizcaya, Isabela and Cagayan, with Isabela hosting 20 tributaries and the Magat Dam, one of the country’s largest.
“We really need flood control projects here,” he added. “If these are real projects, good. But if they are ghost projects, that’s another story.”
Asked about alleged irregularities in flood control programs, Albano said local governments should not be blamed because project planning and implementation are handled by the DPWH, regional directors and district engineers.
“It’s impossible for a provincial budget to cover the entire Cagayan River,” he said. “The DPWH and its engineers are the frontliners who decide where projects go,” he added. — Mark Ernest Villeza, Daphne Galvez, Rainier Allan Ronda, Artemio Dumlao
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