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TRANSCRIPT OF PROCEEDINGS OF THE G-WATCH REPORT ON DPWH September 7, 2004 Sulo Hotel, Quezon City Ms. Flora May Cerna (G-Watch): Good morning. Today I’ll present to you work that has been going on since January of this year. As mentioned earlier, this is the third phase of monitoring by G-Watch. The monitored projects are completed projects and on-going projects. In terms of project types, we have road construction, road maintenance, flood control, airport terminal. For funding source, we have projects funded by ADB, World Bank and GBIC, and of course, we have the locally funded projects. And in terms of geographical spread, we have Luzon, Visayas and Mindanao. This is the profile of the projects that we monitored for these projects: we have 9 completed projects and 17 on-going, 6 of the 9 projects are implemented by the PMOs, 3 by the local offices, 5 of the on- going projects are implemented by the PMOs and 12 are by the local offices. In terms of funding source, we have 15 locally funded and a total of 11 foreign funded projects. In geographical spread, we have 16 projects in Luzon, 4 in Visayas and 6 in Mindanao. These are the projects that have been chosen for this round: for the completed projects in Mindanao we have 1 in Samal in Visayas, we have Eastern Samar, Cebu, Quezon, Cagayan, Catanduanes, and Ilocos Sur. For on-going projects, we have Surigao del Sur, Cagayan de Oro, Davao del Norte, Agusan del Norte, Cebu, Eastern Samar, Quezon, Nueva Vizcaya, Ilocos Sur, Quirino, Pampanga, Masbate, Marinduque, Batangas, Albay. Our methodology in naming these: we first gathered documents from the central office mostly. This are mostly progress reports, summary reports and the others are supplementary reports: like contracts, supplemental agreement, variation orders, notice to proceed, notice of award, program of work among others. Based on these documents we did a documents review or analysis. So from there we already identified the red flags maybe, and then we did site-visits. Then we were able to interview some authorities like Engineer Molano for DPWH in terms of bidding procedures, and Engr Ravanes of Procurement Watch and of course the project engineers of the projects monitored. Before we proceed to the findings, let’s define first what delay is for the G-Watch. We have two kinds of delay: the delay for the completed projects and the delay for the on-going projects. For completed projects, the project is supposed to be concluded, so delay is easy to detect. And this is how we compute it, the actual date start minus the original date start plus the final date of completion minus the original date of completion. In an infrastructure project, we have original start, but sometimes this is still postponed so for us we define that as a delay already. The same goes for final date of completion. For on-going projects, since it is still on-going, the delay is something that can’t be addressed while it’s being implemented; or it can be something that may still increase. So for on going, we have there not the final date of completion but the revised date of completion. Or simply, for both the completed and 1 on-going projects, the delay is the revised implementation period minus the original implementation period. And these are based on DPWH documents. The DPWH delay is different. Delay for them is in terms of slippages. And slippages relate to the financial disbursements of a project on the assumption it relates to actual physical accomplishment. And slippages are adjusted to the revised schedule of implementation. For us we refer to the original plan that the project be completed as planned. And the rational for that is that the planning must be made more accountable. This are the findings for completed projects. This is the table that will summarize what’s the variances in terms of time for completed projects. As you can see here, there are 9 completed projects, 6 foreign assisted, and 3 locally funded. The total variance for all these projects is a total of 1,328 calendar days or an average of 4.9 months. But if you noticed, for Luzon, the projects that incurred delay are the foreign assisted projects and you will see here also that foreign assisted projects incur greater delay: 6.5 months on the average compared to 1.6 months for locally funded. To summarize this slide, we have 6 out of 6 foreign assisted projects that incurred delays and 2 out of 3 locally funded projects that incurred delays. So for completed projects, we have one project that has incurred a delay of more than one year, the Mulanay-San Narciso in Quezon. This has increased in time by 513 calendar days and in terms of percentage, 56.1%. We computed the percentage change in time by dividing the time variance by the original time period. Here’s the profile for on-going projects: We have 5 foreign assisted projects and 11 locally funded projects, a total of 16 projects. If you notice for Visayas there are no delays. For Mindanao, we took out one project and we did not include it in this profiling of on-going projects because its for a separate discussion; it’s a special case. Nonetheless, we have 2 projects that have a total delay of 180 calendar days. We have a total delay of 2613 calendar days or an average of 5.4 months. As you see here, we have 5 foreign assisted projects that incurred much greater delays compared to locally funded projects. We have an average of 1 year and 1 month delay for foreign-assisted projects and 1.9 months delay for locally-funded projects. That is to say, that there are 3 out of 5 on going foreign assisted projects here and 7 out of 11 on-going locally funded projects that incurred delays. The delays that have occurred by more than 1 year are as follows: Macalelon-Mulanay in Quezon, Tagum-Carmen in Davao del Norte, and Cataingan-Placer in Masbate. In Macalelon and Tagum, we have 1 year and a half; in Cataingan, less than 3 years. So the percentages in change in time are as follows, 42.6%, 54.5% and 123.6%. To summarize it all: we have 18 out of 25 projects that have incurred delays or 72% of those that has monitored. 4 projects incurred delays of more than 1 year, all are foreign assisted, 1 is completed, and 3 are on going. And the increase in time range from 43% - 123%. Total variance of all the projects is 3941 calendar days or an average of 5 months. The cause of delays that have been cited or documented by the researchers based on the contract variation, variation orders, and other documentations are as follows: bad weather condition, peace and order situation, delayed GOP payments, contractor’s capability, time suspension due to preliminary inspection at 95% completion and repair of defective works, revision of plans and right of way problem. Our formula in computing for cost variance: revised contract price minus the original contract price. The percentage in change in cost is: cost variance over the original contract price. 2 For completed projects, you will see here that foreign assisted projects increase in millions while locally funded increase in thousands only. The total increase in the 9 completed projects has been 294 million or an average of 32 million. 6 out of 6 foreign assisted projects increased in cost, for local projects 2 out of 3. For on-going projects, one foreign assisted project decreased its cost, and the other one increased cost. And for Visayas, we don’t have cost change. The total cost increase for on-going projects is 365 million or an average increase of 22 million. Top 2 project cost increases in percentage are as follows: the construction and improvement of subprojects in Nueva Ecija and Tagum Carmen in Davao del Norte. In Nueva Ecija, cost increase is 29% or 165 million, and in Davao del Norte 92% or 354 million. To summarize, 14 out of 25 projects or 56% of monitored project increased in project costs. 2 projects increased by more than 25% are all foreign assisted, 1 is completed, and 1 is on going. And the total cost variance is 659 million or an average increase of 26 million. The reasons that have been cited and documented by the researchers are as follows for cost increase: change in work, which may be additional work or extra work; quantity changes in contract items and new item of work; time suspension due to preliminary inspection; and repair of defective works. So if we compare the 11 foreign assisted projects and the 14 locally funded projects, we’ll see there’s big difference: 655 million total cost variance for FAPs and for locally funded, 3 million. In terms of time variance: an average of 8 months for FAPs and 1.6 months for locally funded projects are incurred. The other relevant issues that we have found for this phase, which we have presented to DPWH last Aug 11 and DPWH has responded to, are as follows: First is sub-contracting. Initially we thought sub-contracting is not allowed. But base on our discussion last August, sub-contracting is allowed up to a certain limit. We are to verify the amount and percentage of the sub-contracted portion if it is within the limit. We also found bid irregularity, according to DPWH they were to verify if this were the same data as what they have in the field. We also found what we termed “multiple contracts.” There was one project that seems to be multiple contracts. DPWH said it couldn’t be; it is may be splitting or multi-release contract and they have yet to verify it also. We also found some miscomputations; the DPWH said this might be because of human error. They said most of the computations are manually done. Let’s go through these cases one-by-one. For the case of sub-contracting, this is the Macalelon-Mulanay in Quezon. A portion has been sub- contracted by E. Ramos Construction to Wee Eng Construction. The total portion is 18 kms. The road project net length is 43.54Kms. So it’s 41% in terms of length. But the amount that has been sub- contracted is 170 million or 18% of the contract price. According to Department Order 4 and 70 series of 2004, sub-contracting is allowed if there is prior consent from the approving authority, in this case, the Secretary of the Department. And that it should not be more than 50% of the value of the project. So 170 are clearly within the limit. However, we note that in the sub-contract agreement, it said that it should be increased or decreased by the contractor depending on its assessment of the actual work done. So 170 million may increase for as long it’s within the 50% limit. This led to thining that sub-contracting is a practice that circumvents accountability. The first issue there is it undermines the technical requirement during bid of pledging and committing number of manpower and equipment. We know that during the bidding, there are two proposals submitted: the technical and 3 financial. In the technical proposal, the bidder pledge already manpower and equipment. Therefore, when the bidder who won the contract sub-contracts, this means that the technical requirement committed in the bidding is not fulfilled because different set of equipment and manpower is used in the implmentation. Also, it increases government transaction costs through another eligibility check of sub-contractor. The sub-contractor has to go another eligibility check by the department. This is added load to the department. Furthermore, it was mentioned to us that it is the practice of the contractor to assign portions of the project at a very low cost for profit and with this, it is vulnerable to sub-standard quality of work. Therefore, with these reasons we think department order 4 and 70 series of 2004 is a step back for the department. I learned that before sub-contracting is not allowed for locally funded projects. However, by the issuance of this department order, sub-contracting was allowed again, with certain limitations. In the case of bid irregularity, initially we were provided with documents by the central office: the summary report. In Babak-Samal-Kaputian national road, the actual start of the project was before the Notice to Proceed. So this already signaled something to us. Bid date is March 28, 2003; Notice of Award is April 9, 2003; Project Start is April 25; and based on that document, the notice to proceed is June 9, 2003. Also, we noted that the notice of award is close to bid of opening, interval of 12-calendar days. In doing the process analysis, we see that the notice to proceed and project start has a gap of 1 ½ month. The notice to proceed being on a much later date. As per government Procurement Reform Act, bid procedures run for a minimum of 1 month. But this case is governed by PD1594 and EO40, so there’s no minimum period but only maximum period in between stages. For the notice of award, what is provided by PD1594 and EO40 is that, there should be 15 calendar days between notice of award and notice to proceed, and thereafter the project shall start. What can happen between notice of award and notice to proceed? Let’s say there’s notice of award but no notice to proceed yet, between these two stages there may be non-acceptance of the award. Technically, puede nya pang tanggihan. Between the project start and notice to proceed also, the danger we see here is since the notice to proceed sets the affectivity of the terms provided in the approved contract, there may be the danger of non-supervision of the DPWH for 1 ½ months because the project has started without the notice to proceed. Also, it has been said that there needs to be completion of documentary requirements for the approval of contract. So when we presented this last August 11, they said mali yung date sa central office, and this has been corrected, and that it is April 25. This is a case of inconsistent data therefore. For the Bislig, we initially name this as a case of multiple contracts. But when we presented it to DPWH, they said this is not a case of multiple contracts so we just put question mark there because we don’t want to name it. In 1998, this project has a budget of 31 million; in 1999, 12 million; in 2000, 22 million, and in 2002, a supplemental agreement of 28 million, or a total of 94 million. It would seem that the document presented to us each time is a new contract, and the cost is not revised. So if we were to take 1998 budget as original project cost, then this project has increased by 63 million or 205%. All of these refer to exactly the same contract information. It is not per component; it’s one bridge for 3 different budgets. I think DPWH has something to say about this. 4 Also in 1999, it has been reported that it has already 995 of accomplishment, but the actual project start is July 13, 2000 so this is something we cannot figure out. In 2000, it reported a 92.51% of accomplishment, and in 2002 60.34% accomplishment. Upon field visit, we saw that only about 25% of the project was completed. The local official said that the project might take another 5 years to complete. So in terms of cost and time variance, the time variance of Bislig bridge as reported is 504 calendar days. But if we are to add the days that ran from 1998, then it should be 1,234 calendar days or a percentage of change in time of 159.2%. In cost variance, if we were to take the 31 million budgets in 1998, the project cost has increased by 63.8 million or 205%. These are the questions we would like to ask: how is it possible that 99.99% were accomplished in 1998 and 96% in 1999 when the contract was entered into in 2000 and actual project start is July 2000? How was this project procured? We also found some miscomputations. For Babak-Samal, we were provided the program of work. In the lower part where the font is red, we see that the engineering and administrative overhead is 350,000 and there’s a formula provided for. When we computed, the items A1 to A4 is 234,000 not 350,000; therefore, a variance of 115,000. And for Junction Tuganay in Davao del Norte, we noticed may mali sa total cost: lugi sila ng 1,000. Pero when it comes to engineering and administrative overhead, there is a variance of 122,000. So if we were to take the more conservative figure of 115,000 and we know DPWH implements more or less 30,000 projects per year, the significance of this human error would be 3.4 billion pesos. Because this is already the third phase of g-watch, the questions we would like to ask is: why do the same findings appear yearly? And why do the FAPs have large cost and time variances compared to the locally funded projects? And why do these problems remain undetected and not immediately corrected? For those projects that we have seen have documentation in the central office which would signal already. Therefore, for FAP and those obvious cases that have irregularity or those that have proper documentation, we recommend a more stringent monitoring and sanctioning. For FAP, we recommend that monitoring would be more stringent compared to local projects because they have foreign consultants, project engineer, PMO. We recommend that three- level monitoring of FAPs could be made more effective by increasing the accountability of consultants through a performance-based rate system. The consultants should be made accountable for the delays, the consultants are paid on per month basis, so incentive for them are incentives. With this, we have to make the payment system for the consultants on performance-based. And for the projects where there seems to be a lapse on the oversight functions of the project inspector by more than 6 months, sanctions must be imposed to that assigned inspector. In August 11, we recommend an immediate investigation of the cases cited. And I was given a copy of this: a memo was issued last August 18 by Director Bandonillo regarding: clarification of the findings presented. On the causes of delays, we note that bad weather conditions and peace and order situations are really unexpected events, while the others are within the control of the government. Bad weather condition, 5 according to DPWH is something that is already factored in during the planning of schedule of work, so it shouldn’t be a problem. This is where government can do something about. To minimize delays on the peace and order situation, this is what we recommend. DPWH to develop a coordinating mechanism with DILG, League of the Municipalities of the Philippines, League of Cities, Liga ng mga Barangay for the facilitation in the implementation of infrastructure projects. The leagues are self-regulatory bodies, which are able to create pressure on their peers so if there’s extortion, DPWH may go to leagues to report extortion of its members. What’s in it for DPWH to enter a Memorandum of Agreement with the leagues? Better and more efficient implementation of the DPWH projects. And for the leagues, they are the recipients of the project, and that they would like to immediately access the project benefits. The logical next step for them is to join into a MOA. For the contractors’ capability and acquisition, this is something that should be addressed already by government Procurement Reform Act. There’s only need for a strict compliance of GPRA. The contractors’ capability should be something that has been checked for post qualification, net financial capacity, and net financial contracting capacity. And the right of way acquisition is something that should be addressed by the GPRA because projects that have right of way problem should not be subjected for bidding until the right of way has been acquired. For time suspension due to preliminary inspection and repair of defective works, we’re thinking preliminary works may go on without necessarily extending the date of completion. We feel it is not necessary for the project to be suspended just to have preliminary inspection. In the revisions of plans, we recommend a more accountable detailed engineering, which is also addressed by the GPRA. The detailed engineering should have a warranty. Lastly, for the delayed GOP payments: with the fiscal crisis, DPWH must complete necessary documentation earlier for immediate release of payment from DBM. DBM, on the other hand, must improve their payment scheme for it to be more efficient. Also, DOF must raise revenues and taxpayers, us, must of course pay our taxes. We see that the delayed GOP payments are due to many reasons. Clog of documents in DPWH is one, but Asec. Asis shared with us that they are already improving the systems for this. It could also be due to DBM’s slow processing of release. Or, it could also be because there isn’t money. There are several reasons but the bulk of this responsibility is not within the control of DPWH, they say. For us though, general responsibility over delayed works due to delayed GOP payments must rest upon DPWH still. On cost increases, to minimize this, more effective and accountable planning via detailed engineering on where we minimize cost in changes. As to cost increases due to time suspension due to preliminary inspection and repair of defective works, maybe the repair of the defective works should be borne by the contractors. The increase in cost should not be shouldered by the government. During the August 11 presentation, DPWH agreed to have CSOs join with DPWH monitors in the monitoring of their projects and there have been initial talks of a MOA to be entered with G-Watch. The importance also of CSO in monitoring DPWH projects is highlighted with the fact that DPWH can only monitor about 10% of the projects that it implements. So that’s it. Mr. Dondon Parafina (G-Watch): 6 So we’ll now hear comments and reactions from our reactors. Maybe from DPWH we’ll appreciate a special reaction on the Bislig bridge: how come that it is only 25% complete but the government already spent 94 million pesos on it. So we’ll start with Honorable Raul Asis, Assistant Secretary of DPWH. Asst. Secretary Raul Asis (DPWH): Magandang umaga sa inyong lahat. Honorable Simeon Marcelo, other government officials, our guests from the LGUs, the Contractors Association, other government agencies. I’d like to give a reaction on behalf of the DPWH. First let me give some clarifications. One, on the sample size: the sample size is 26 projects and 11 FAP or about 40% and 15 locally funded 60%. But in actual, if you take the whole universe, we have about 150 FAPs. And of the 30,000 that we’re doing annually, 29,800 are actually locally funded projects. So parang may problema. Then the other one I’d like to point out is the definition of time variance or delay. Ang sabi kanina delay, as far as DPWH is concerned, is in terms of financial disbursement. Hindi ho ganun ang delay accomplishment as far as DPWH is concerned. Yung accomplishment is the money value of work accomplished. Kasi you could not add up yung mga items of work dahil iba-iba ang units of measure nila. May sqm, may hectare, etc. so the common denominator is money, and then we come up with weights. Kapag in-add ito, weighted sum, yung monetary value pag dinivide mo sa… that becomes the actual accomplishment. So yung slippage is actually measured. Yung definition namin ng slippage is the planned accomplishment minus the actual accomplishment. So if it’s positive, you are ahead of the schedule; if negative, you are behind the schedule. So both planned and actual are both expressed in terms of monetary values. Yung actual is actually taken from the statement of work accomplished. So yun yung monthly billing ng kontratista after it has been approved by the DPWH. So pareho ang definition natin. Actually in the study of construction management, yung pag-aaral na ginawa ng G-Watch centers only on just three major elements of project management namely time, cost and quality. Although merong some aspect na lumabas sa quality, spinning of from time and cost variances. Para makumpleto ang pag-aaral, we are inviting G-Watch to join us in our quality assurance assessments quarterly, I’ll discuss the three: time, cost and quality. First, on the question of time variance: It was noted that for completed projects for FAPs, the average delay is 13 months; and for locally-funded projects, its two months. For on-going projects sa FAPs, its 8 months; and for locally funded projects, its about 1.5 months. Ito yung statistics dahil medyo may problema dun sa sample size pero dinivide naman nya, so walang problema. It may really be true na representative yung 11 projects as far as the 100 projects is concerned and that the reasons cited are bad weather, peace and order, delayed progress payments, contractors’ capability. Let me briefly discuss each one of them. Yung bad weather is already factored in, so it becomes a cost, kasi meron tayong rainfall data, and nanggagaling sa PAG-ASA. So alam natin during the planning stage kung kelan papatak ito. If it is within that range, halimbawa sa August sabi dun sa PAG-ASA for that particular area, makakapagtrabaho lang kayo ng 12 days. For that month of August, ang nakafactor-in lang ay yung 12 days. Pero kung maulan ng mahigit sa 19 days allowance, yun ang magiging valid cost for delay. Halimbawa, kung yung 19 days projected ng PAG-ASA umulan ng 25 days, yung 6 days lang ang valid cost for delay hindi yung buo. Now, the problem arises dun sa timing ng scheduling kasi yung schedule 7 ginagawa before the project is done, 6 months or a year before a project is done. Halimbawa, naka- schedule sya talaga magsimula Enero o February pero nalate yung release mo, babagsak ngayon na magsisimula ka sa mga buwan ng tag-ulan. And these may be the months that the starting activities may not really be able to take off. There are activities na nakaplano or nagsimula during the dry season but because we could not really predict when the money would come, ganun yung nangyayari. Pero hindi ko sinasabi na ganun na lahat yung nangyayari. On the problem of peace and order, what the policy now of the Department is kung hindi namin kaya, we turn it over to the area engineers. Yun ang ginagawang policy ngayon ni Secretary. When we enter the MOA with the… it’s useless din kasi babantayan din namin yung contractor. If you would get military support, babantayan, doble gastos lang yon. Susunugin yung equipment ng contractor naming, kawawa naman yung contractor namin. We might as well terminate the contract and turn it over to the military. Third, the problem of delayed progress payment: Ang utang namin as of August 25 is about 11 billion sa aming mga contractors. So I think tomorrow Mr. Lito Madrasto and I will be meeting to discuss itong bills purchase window. Ang mangyayari dito, magkakaroon tayo ng financial facility where deretso magbabayad sa contractor deretsa yung Landbank o yung NDC. And because the contractors recognize yung problems natin financially, there is crisis, the contractors volunteered to shoulder the interests, pero one year lang ata, at least for the first year. We held the meeting with PCA 2 or 3 weeks ago, Secretary Boncodin was there; Secretary Soriquez was there and we agreed to finalize the MOA. PCA came out with the draft and we’re supposed to meet tomorrow with PCA and discuss, then transmit it to the DBM. Yun ang isang ginagawa namin. But I think, as far as processing is concerned, this is something within our control. It’s bad enough that we could not pay because we do not have NCA. When I used to be with the controllership and financial management where I spent 6 months, I found out na yung processing kung minsan inaabot ng 3 months to 4 months. So magsusubmit ng billing ang contractor. Then, this will be validated by the consultant. Kung minsan ibabalik sa contractor, ivavalidate ng project management office, ibabalik sa contractor, and so on. Try this process; it takes 3 to 4 months. And you can’t be paid; cash cannot be released. Yung cash tinatawag naming NCA. Yung voucher has been signed and this has been cued dun sa accounts payable system ng DBM. I think on the average of two months bago ma-process ng DBM. Actually, pag hindi ma-process, hundi magkaroon ng pondo kasi pila yun. So imagine just DPWH, 11 billion yun. Ang iba pang agency, so ganun din yung problema. We discuss this with the Execom and we recommend to the Secretary na magkaroon kami ng document tracking system. It’s nothing but an electronic routing slip. Ngayon, lahat ng papeles we’re talking about here for a start, civil works related transactions. This pertains to contracts, notice of award, eligibility, progress billings, and first payment, final payment, variation orders, would go through the document tracking system. Ang ginawa namin ngayon, may receiving kami. It’s the IT help desk. Neutral ito; computer group ito. Lahat ng kontratista, lahat ng papeles nila ay dito sinasubmit sa IT help desk sa DOTS Center. Pagdating mo sa DOTS Center, ilalog-in ito ng IT group sa computer, and then lalagyan ng orange tag. So while it’s routed, nakikita lahat ng tao. This is the DPWH express lane. So pag may orange tag, 8 visible na visible and then the contractor is given an acknowledgement receipt. Nandun yung details nun, puede sya magfollow-up later kung nasaan na yung transaction nya. On the hour and every hour, the DOTS Center transmits this, carries the document, tap the implementing offices. Sa project management office namin dinadala ito. Pagreceive dun, ie-enter ng PMOs yung exact time. The software will prescribe time for processing per office. Halimbawa, pinasok mo progress billing, pagpasok dun, nakalagay na kung sino dadaanan nun hanggang kahero, hanggang CFMS voucher approval. Nakalagay dun kung ilang araw, we’re talking here of working days, minimum of 1 day yung unit of measure namin, ilang araw yung total processing time. Nandun yung due date nya, hanggang segundo, alam nyo naman ang computer, may decimal pa yung segundo. Yun ang sinusunod namin. Ano ang advantages nito? Dati, nung may routing slip tayo, kapag natapos yung construction, nobody cares to analyze the routing slip, nawawala lang yun. Ang hirap kasi biruin mo 1000 routing slip ang inaanalyze mo. But if we store it in the computer, nakakapag-analyze ka. Ano yung mga pagbabagal? Now at the end of each month, the secretary signs memoranda to the heads of implementing offices na may delayed processing of transactions. Then at the end of the month, we generate an honor roll and a horror roll. We are now trying to come up, kulang pa kasi yung mga makina doon sa DOTS Center, but the idea is to make this a lounge for contractor where they could come in and follow up yung mga paper nila using the computer. So ang gusto naming mangyari dito, we would want to eliminate yung personal contact between the DPWH personnel and the contractor to remove the opportunity for graft. Usually pag pumasok ka sa government office, parang palengke yan, lalo na yang accounting and so on. Kasi wala, hindi alam ng contractor kung nasaan ang papeles nila. So ngayon, dun sya magfafollow-up, bibigay nya yung acknowledgement receipt nya, yung tao naming ang magke-key in tapos bibigay sa kanya through print out kung asan. Pero eventually, gusto namin sila mismo ang gumawa nun. We will have about four, four ang target naming makina, where our contractors would log-in. Since on-line na ang DPWH, ang regional offices, I hope, magagamit yun for communication para makikita ng central office lahat din ng nangyayari sa regional offices. Four of our regional offices, 52 district offices of the total 176 would be hook up by the end of the year. Itong 52 district offices nakikita din ang nangyayari sa central office. This is what we are trying to do to speed-up. Ano yung initial effect, anong resulta? We found out that hindi pa maganda, bumilis lang ng 33% yung processing namin. Marami na kaming nabigyan ng sanctions. Ang sanctions namin sa first offense, you’re wired; sa second offense, reprimand; on the third offense, 6 months suspension; and on the fourth offense, 1 year suspension without pay. This is consistent with the civil service rules. We’re talking about delayed progress payment and yung assessing contractors’ capability. It’s true na pinapayagan namin yung sub-contracting. In fact, even sa simula puedeng magsub-contract, pag- submit ng eligibility o unang bid nya. This is because there are advantages of sub-contracting also. Kasi yung specialty works hindi dapat general contractor gumagawa nun, may sub-contractor ka talaga kasi napakalaki ng overhead ng civil works contractor if he has to maintain lahat ng specialty works expertise in his organizational unit. But when you’re focused on a specialty work, nagtratrabaho ka to be the best in that field. So yung latest technology kukunin mo lagi dun. So that’s the reason why hindi natin binabawal ang sub-contracting, provided that it is approved by the head of the implementing 9 agency and that sub-contractor goes through the same eligibility check as the main contractor. The main contractor though still carries with him all the responsibilities, liable pa rin sya dun sa gagawin ng sub-contractor. What else are we trying to do? Meron kami ngayon project monitoring group na inassemble ni Secretary, bago pa lang ito. I think 2 or 3 months ago, we have a special monitoring group. It’s placed directly under my supervision. Ang una naming ginawa dito ay nagset kami ng agency target staff. I don’t know if this is the first time. Probably this is the first time we did this. We still have carry-over projects. Ang ibig sabihin ng carry-over, ang funding nanggaling sa previous years. So the current year’s program, ang funding nyan 2004 but we still have 2003 projects. Ang DBM allows us to use the obligation authority for a period of 2 years. So lahat ng 2003 funded valid yung obligation nito until December 31, 2004. But there are projects na prior pa sa 2003, I think we still have more than 500 projects na funded out of 2000, 2001, 2002. So these projects have been obligated by the implementing agency but are encountering serious problems. I think ang mga foremost nito ay yung right of way problems. May pambayad ang departamento, nag- aaway sa korte, siguro mga 10-15% ang right of way problems lalo sa Muslim areas. May pera ang departamento hindi nga lang alam kung kanino ibabayad dahil nag-aaway yung mga heirs, imagine naisama ako dito. In a Muslim family, aapat ang pamilya, napatay na lahat yung talagang heirs. Nag- aaway yung mga children ng apat na pamilya. So the court will have to decide on that. Sa amin mismo, lahat ng abugado andun. So right of way is really a problem as far as we are concerned. Dati pag may right of way, sige kunin yung right of way wala pang funding, marami kaming unfunded na ganun. Pero ngayon, the policy is, since 2 years ago or last year, lahat ng project cost on right of way should be built in sa project cost. Dati hindi, wala sa project cost yun, lump sum, kaya umabot ng 11 billion ang utang namin sa right of way. Ang nirerelease lang sa amin nila Rica ay mga 200 million a year. So you could just imagine yung utang namin, right of way yun. This is separate from dun sa pinag-uusapan na current. That’s what we are trying to do, improve that. Of course, we have yung computerization ng project monitoring group. By the way, ano yung agency target? Lahat ng carry-over projects prior to 2003 ay dapat matapos by December 31 of this year. That’s the agency target that we set. For all 2003 projects, 90% of them must be accomplished by the end of this year. And the remaining 10%, by March 2005. For the current year’s program, the target is we should complete 80% of the projects by the end of this year, and the balance of 20% by June of next year. May papasok na naman 20,000 o 15,000 na projects, wala kang gaanung pera that we would have to implement. I guess this is the first time we did that, that we set targets. And we would give sanctions to head of offices that would not be able to meet the agency targets. So naka-tie-up ito dun sa agency performance indicators na ginawa ng DBM at NEDA. We’re trying to do something about these delays perhaps maso-solve na natin ito. The other thing, yung malaking problema natin ditto is yung 15 projects sampled nyo sa ADB kakaiba. It has something unique na nangyari because ADB suspended loan disbursements nung June 1, 2003. We have a policy problem with the ADB as far as the payment of right of way. Hindi kami nagkakasundo kung ano ang gagamitin, kung yung market price o yung assessed. Gusto ng ADB masunod sila, hindi naman puede yun, makukulong yung mga tao naming kung susundin yung ADB because it’s against the law. Ang ginawa ng ADB sinuspend lahat ng loan disbursements namin. Nakapending lahat, yung una mong example, itong Macalelong, ganun ang nangyari dun, sinuspend ng ADB. What can we do? At 10 the middle of the project, humingi yung E.Ramos contractor ng sub-contractor. Kasi wala na talaga, dried up na sya, biruin mo we could not pay dahil suspendido, ayaw magre-imburse, disburse ng ADB. What can we do? Nakakuha sya ng sub-contractor, yung Wieng contractor, tumulong sa kanya. But at a certain point in time, pati sub-contractor ayaw na rin magtrabaho. Under the law, under 9184, the contractor may ask for the suspension of the works, ibig sabihin hihinto yung kontrata, if we could not pay them after 45 days from date of billing. Most of our contractors now are actually sacrificing. Tingnan nyo ang problema natin, we are trying to fast track projects but we cannot give the logistical support to the contractors. Di ba problem yun? Gusto natin bumilis ang project, wala naman tayo binabayad sa kontratista. Of course, isolated case yung sa ADB. So na-exacerbate yung problema, andun na yung problema, talagang may delay sa project, this is common sa FAPs and even in locally funded project. You know why there are delays in locally funded projects? Mali ang preliminary engineering. Why? Because we don’t have sufficient funds to carry out preliminary engineering. Ang preliminary engineering naming, I think, 200-250 million, actually nung nakaraang Congress, 2003, zero pa ng congress yun. Nilagay dun sa pork barrel nila. Maliit na nga 250 million, tinanggal pa ng Congress, inilipat sa pork barrel nila naiwan sa amin wala, zero. And so what we did, we realign some projects, we deferred o kinansel para magkaroon ng 150,000 for preliminary engineering. What’s preliminary engineering? Yan yung nagsu-survey prior to making the plans. If you do not have a survey, sa mesa ka gumagawa ng plano, nakatingala ka sa langit, tsumatsamba ka. In the absence of preliminary engineering where usually ganun ang nangyayari, lalo- lalo na kung ang pinagawa, kami ang gumagawa ng pork barrel projects. Pag sinabi ng congressman na dapat matapos kagad yan, we have to do the plan, wala ka naman pera para magsurvey, wala kang tao para gumawa ng survey, I think this is the cause why there are so many delays. In the middle of the project, you have to redesign because your plans do not suit the actual conditions. In Metro Manila alone, this is a problem, because our utility firms do not have a built-in plans, maghuhukay ka na, makikita mo, “aba, may linya pala ng NAWASA dito.” Buti kung maliit, e 1 meter pipe. I-rerelocate mo, hindi ganun kabilis magrelocate. Igagawa ng plano ng MWSS, iischedule yun kung kelen puputulan, hindi puedeng tuloy-tuloy ang putol non. Gagawin lang ng MWSS yun on wee hours of the morning. You see, yun ang problema natin. Even Meralco, even PLDT hindi maganda ang built-in nila. So whenever we coordinate with them, problema. So what are we trying to do with that? We are trying to incorporate in our plans na magkaroon tayo ng common utility line. So in your notes ilalagay na natin sa plan and specifications ng DPWH, dito kayo dadaan walang kanya-kanya. So magproprovide na, mag-aabang na ang DPWH sa line na to, dun sila kakabit lagi. So at least alam na natin kung san yung lines nila. For completed projects, ang variance on the average is 49 million and for locally-funded projects its 15,000, but this is only for completed projects. So yun ang findings. Medyo ngayon, mawawala yan, kasi under RA 9184, the maximum na puede kang magvariation order ay 10% na lang. nung contract. So hopefully this will solve that. At saka lahat nung nagdesign makukulong sya kung mali yung design nya. Hopefully that will solve the problem. Meaning right at the very start, your engineering must be complete. I think the contractors will wake up and maisip nya, importante pala to, problema to, the designers, the consultants, would now take note of this. Now, merong specific problem, puedeng iflash mo yung transparency mo yung other relevant issues. Yung may sub-contract, multiple contracts, at miscomputations. 11 Yung multiple contracts, I don’t think multiple contracts yan. Usually, DBM will not give funding for the entire project. Usually locally-funded project, hindi multi-year ang funding. Ang nagkakaroon lang ng multi-year kadalasan FAPs. For us to be able to enter into a loan with a lending institution, DBM would issue yung tinatawag na Forward Obligational Authority or FOA. Parang sinasabi na, ito committed ng gobyerno through out hanggang matapos yung project. But usually this happens only for FAPs. For local-funded projects, the funding is on an annual basis. Annually, may obligational authority, so if you have a project that would take you three years to do, if your funds for that, let’s say two years may pondo ka sufficient, dalawang kontrata talaga yun. Hindi ka puedeng mag-enter into a contract kung walang available funds. Di ba? So you enter into a contract only for that portion responding only to that corresponding calendar year. The following year, yung phase two, another contract yun. Kaya nagkakaroon ng multiple contracts. Usually, halimbawa the cost of a bridge is 200 million, may priorities yan , maraming nag-aaway na mga probinsya sasabihin nila imperial Manila na naman kayo, kami dito sa Nueva Ecija, kami dito sa Cebu walang pera. So you have to divide this. Yung mabibigay mo sa 200 million, 20 million, 10 million, 30 million lang. So anong itatayo dun per year? Makikita ng tao, ang tagal nun, pinababayaan, kinurakot ng DPWH. But the truth of it is yung pera nya ay para dun lang. The following year, tatayuan na naman ng yearder ng department yan. Sa kapabayaan, syempre iwanan ng contractor yun. Kung minsan may natitirang bakal, kinakalawang yun, nakikita ng taong bayan yun. The following year matatapos, matutuwa ang mga tao. Tapos may tulay pero walang approaches. Pano gagamitin yan walang approaches? Ihahanap na naman ng pondo. Nangyayari to lalo na sa mga pork barrel projects where immediate yung gustong impact ng mga politicians natin pero di sufficient yung pondo. So nagiging piece meal. You could imagine sa tulay kitang kita yun, sa kalye hindi nakikita yun, sa building kitang kita yun. On bid irregularity, ganito nangyari nun. Nagpakuha ako, the date of the notice to proceed is actually April 15. I don’t know kung ganito talaga ang nangyari. But this might be the possibility, yung project monitoring naming works with initial data that is entered way before the project is started. Halimbawa, Enero pinasok lahat ng project mo for 2004, pero kung hindi ina-update ito, kunwari it’s due to start at January, but it actually started in April or May, usually ang nakareflect yung luma. This is the possibility. I’m not sure. The notice to proceed actually is dated April 15, and the contract time took effect April 25. So there is actually no work done before April 25. Although there are instances when contractors start at their own risks. Hindi naming pinayagan yun kasi masama yun because if the contractor starts at his own risk, ibig sabihin walang DPWH supervision, wala kaming basis na bantayan yung project. We discourage that. Pero meron talaga contractor hot na hot sisimulan na nya, alam nya matagal lang yung documentation. Sabi nga natin ngayon may document tracking system, perhaps we could work on that. Nasagot ko na yung sub-contracting, that’s the Babak-Samal, and then yung Bislig nasagot ko na. Yung miscomputations, I think maling form yung ginamit ng implementing office. It used to be ESAO, engineering supervision and administrative overhead, 3% lang, dun sa bago ngayon we’re using 3½% . This is special provision of General Appropriations Act, yun ang nangyayari, and so yung discrepancy amounting to 0.5%. 12 The good news is we acquired software known as ASHTO, American Association of State Highway and Transport Officials. We would be the first country outside America to use this. About 29 states in America are using the ASHTO software. So it’s an integrated project management software na nandun yung estimating, andun yung tendering, andun yung monitoring, andun yung contract management and project management. So initially, we would want to activate itong estimating and tendering phases of the software. Kaya lang, kelangan pang iconfigure nung system kasi tailored ito sa US. Halimbawa, sa halip na district nakalagay, ang nakalagay state, county, sa halip na peso, nakalagay dollar. And of course, they have their own procurement law. We are trying to revise this to suit our procurement law. In some cases we are trying to customize your reports to suit our needs. Hopefully we should be able to operationalize this by March or middle of next year. That’s as to software that will take care of all the calculations, so mawawala dapat yung manual calculations. We would have a price database na kinukuha namin and inistore sa computer and then the quantities will have to be taken off from the plants by the estimator. Pero hindi nya nakikita yung resulta ng multiplication. Ipapasok nya lang yung quantities, dimensions, the computer will generate the quantities and then the computer would access the price database to get unit prices and to get the total for you to arrive at the total agency estimate. Pwede natin itago to, isa lang nakakaalam ng password kung kelan igegenerate. Unlike yung manual, kelangan matapos long before the bidding kasi pipirmahan pa. Ito, puedeng yung mismong bidding pagbukas saka pa lang ira-run, seconds lang itatakbo ng computer. So mawawala yung leakage. We are trying to maximize the use of computer to help us out dito sa fight against graft and corruption. Other things we are doing sa cost: last Wednesday, we started the parallel run of the new government accounting system. I think we are one of the pilot agencies of COA. Under the stewardship of Chairman Carage of COA, dinevelop nila itong NGAs. Walang consultants na ginamit si Chairman dito, ginamit nya COA staff at mga estudyante, PUP ata yun. And they’ll develop this in about 18 months. Now we’re running it. Nakaparallel pa, ibig sabihin naka-run yung computer pero nagmamanual pa rin kami, baka may sabit pa. Eventually pag malinis na, NGAS will take over all our financial transaction. Yun siguro ang key to financial problems. Of course. that doesn’t solve the problem on availability of cash. Lastly, let me just inform you that the Secretary has created an integrity board in DPWH. It’s Chaired by myself and sitting as members are Lito Madrasto, representing PCA, and Mr. Willie Nastor representing NACAP. Ang objective nito ay mapahatid sa min lahat ng reklamo ng mga kontratista against our officials. Sabi nga ni Lito, kokonti nagfafile ng reklamo kasi meron ng forum na tatakbuhan yung contractor. Supporting that group are complaints and actions center naming, yung regular intelligence section that does the investigation. But PCA and NACAP are actually working out para magkaroon ito ng grant or some foreign assistance para magkaroon kami ng sariling Secretariat and investigative group na independent. So it’s PCA and NACAP that’s working this out with I think the World Bank. If you have that then we have an integrity board na independent. For quality, the last, we have what we call our quality assurance units. I’m also Assistant Secretary for research and standards where the quality control function resides. So, quarterly we sent out two engineers per region who would stay there for 15 working days and assess projects. On the average, we assess 20 or more. Basta sa buong taon, ang naa-assess namin ay 10%. Out of 20,000 – 30,000, we are only able to assess about 1,500 projects. Ganun lang yung sample namin. 13 This QAUs comeback to central office to prepare the report and then we ask the contractors to correct the works prior to payment. So kung may defect yung work, hindi na babayaran. So andun sya pero hindi nababayaran. Ang problema minsan nakikita ng tao. Sasabihin, bakit kagagawa lang nyan ginigiba na naman ng DPWH. If they’re not properly informed, ganun ang mensahe sa kanila. So what we are doing, ini-sprayan ng red, tapos ang nakalagay DPWH rejected. Pag dumaan ang tao makikita nila reject pala yun. Ang dating kasi sa tao sinasayang ng DPWH ang pera, kagagawa lang, ginagiba na naman ng Departamento. Yun ang problema kapag kulang ang information drive ng isang government agency. But this has been in existence since 1990. Actually, World Bank ang nagtulak sa amin you should have this quality assurance, you should strengthen your quality assurance. This triggers the coming up of a new law. We did it 1990. Pero tao yan, parang pulis, pag matagal na sa isang lugar, nagkakaroon ng familiarity, nagiging kaibigan na ng contractor, ng agency and so on. When I was still director of that bureau, I think 5 years ago, naglagay ako ng validation group. These are 5 senior people, lima lang na pinagkakatiwalaan ko. Weeks after the QAU units’, pupunta ngayon tong validation group, mga hepe to, bringing with them AUV report. Itse-check lang kung meron talagang ganong depekto e mali. Pag may nadagdag dun, ibig sabihin hindi nakita ng QAU either nakapikit yung mata at tumingin sya sa iba or hindi nya kinover yung buong project. And the most we could do is mga 1 taon sya di palalabasin, igragrounded sya. But ang naging problema ko, suppose macorrupt itong second level, will you create a 3rd level, will you create a 4th level? When would it stop? Ganun ang problema natin sa sistema natin. It has to be built on trust; it has to be built on character, sufficiency in character. Yan yung rare sa atin ngayon. If I could have 16 engineers, 1 per region, patrolling all projects na kumpleto yung character, I think we would be better off. Where do I get those 16? Si Abraham nga nakipagtawaran sa Dios, mula sa 50 hanggang lima hindi nakakita sa Sodom and Gomora. Much as we are trying to do to reform, ito yung problema natin. But I think ang susi, the key to these reforms is IT. When we’re able to make our operations transparent, our transaction with the Congressman, our transactions with the Contractors, our transaction with the suppliers known to the public, I think mag-iimprove yung operations namin, mababawasan yung graft and corruption. Dapat kasi yung maging move ng department is preventing the occurrence of graft and corruption. Yung ombudsman, sya na yung manghuli nung nagawa Yun ang sinasabi ko sa internal audit service namin, hindi nya trabaho maghanap ng anomalya, kung nakakita sya ng anomalya, dapat aksidente lang. In the course of auditing the system naka-unearth ng anomalya. But the primary function of internal audit is to see to it that the systems are working. Related pala, with the concurrence dun sa integrity board, we are moving towards ISO accreditation of our major suppliers and our contractors and our consultants. We tried this several years back sa malaking project, the problem is when we put this sa specifications, ang nangyari na-disqualify lahat ng Pilipino puro Japanese at Koreans ang nakapasok kasi wala silang ISO. So we have to give ample time for Filipino construction industry na nakakuha ng accreditation. Ano maganda dun? May 3 rd party who’s watching them. Hindi kelangan magfocus ng DPWH, naghahanap ng anomaly. It does its own work operations. The ISO group watches over yung 2nd party. Kung may nakitang anomalya, sususpindihin sya. 14 We commend what G-Watch is doing and if we could be of further help, then just let us know. Thank you, magandang umaga po sa inyong lahat. Mr. Dondon Parafina (G-Watch): Maraming Salamat din po ASEC Asis. For a comment and reaction from the private sector from a non- government organization, can we have the comment of Mr. Bill Luz of Makati Business Club? Mr. Bill Luz (MBC): Thank you and good morning. First of all, my congratulations to the G-watch for undertaking the project and for its thoroughness in monitoring the project. I guess the challenge before us is how to replicate and expand the coverage of such a project that allow more people or train more people and equip them to be able to undertake the monitoring. There are three areas that were focused on, at least three issues already mentioned, timeliness, cost and quality. Those are the three items. And I think they are well documented in terms of the impact or whether they were foreign assisted or local projects. But there’s a 4th that I would like to bring up, w/c I think we have to develop a certain set of matrix. So there’s timeliness, there’s cost, there’s quality and for me, there’s necessity. Do we really need that project? Because sometimes, I get the feeling that we’re just gonna build the project because there’s money out there in the budget. In a surplus situation, especially perhaps for a local government unit and so many to built just for the sake of building. This is something I think we have to make sure that we’re going to spend it on things we really need. Without going into details of the time, cost, quality and necessity indicators, I think there’s a good argument we made for documenting in a systematic way a set of practices and benchmarks for construction activity. I think this is not, should not be that difficult because I believe this is being done regularly by many private corporations And I’m sure, by a lot of contractors and by DPWH itself. The key is how to do it consistently and persistently over time in a fashion that’s going to be cost effective. Let’s just look at, say, three projects, to check for timeliness, cost, quality and necessity. Not all three projects I’m going to give touch on all of four issues. But they stick on my mind because it seems to be rather easy to measure. Were they really brought in at a right cost? Were they necessary? Did they have the quality? So on and so forth. My three examples: the famous Macapagal Boulevard on an out in the reclaimed area of Roxas Boulevard. Last I recall, it was split into three sections and have three separate contractors. Am I correct? It seems to be that one section was much, much more expensive than the other two sections. And the simple explanation here is that the other two sections were built on private money and the expensive section was built on our money. Right? So we pay the price. Yet I don’t understand how this can possibly happen and how people can get away with this. Easy to benchmark. It’s not even comparing one road with another, instead comparing one stretch to another stretch of the same road, presumably with quite same specifications, if not, identical. Number two, let’s look at some public buildings, Makati City Hall is another good example. I don’t know how much it cost to construct per square meter versus, say, a comparative building. Admittedly, I’ve been that building many times. This is a grade A building, an intelligent building, as there are others in the Makati area. But I’d like to see a comparison between the costs per square meter basis versus a similar building, on a similar size, or similarly spec building in Makati. Then you’ll get an idea of a nice benchmark in terms of pricing. 15 But my latest favorite has nothing to do with timeliness, cost or quality but necessity, this is the Meralco avenue overpass in Ortigas complex crossing the corner of Meralco Avenue and Julio Vargas which in my mind was not busy a corner to begin with. Certainly not like Edsa - Ortigas or whatever other overpasses, or anything on Edsa, Actually, there was a traffic light there. I think all you need is traffic light adjustment and yet there was a nice overpass beautifully built, can’t be more than 3 to 4 hundred meters long. I understand it was about 300 million pesos, which make it a cool “how much” per square meter, a million per meter. A million per meter? That has to be the most expensive road in the country. And the thing is, what’s mind boggling is, the quality is great, again the matter of necessity. Do we really need to spend that kind of money for a project to cross the street? And I heard someone they are rather misled when they took the overpass, because the sign said “Shaw Boulevard” or something like this. They were in the impression that when they get up the overpass, by the time they get down they’ll be quite near Shaw boulevard, and they’re quite far. They just actually cross street and they landed not quite at the BENPRES building. I think and of course, you still have to drive a little ways in order to get there. In other words, again do we need that kind of expense for that kind of project? There must be some ways of measuring this “do we need this project”. I’m glad, the assistant secretary mentioned, there was an ISO rating. I think it might be one good way to build up quality over time. Because ISO ratings are not about the quality of your product, but the quality of management system within your company. And the trick with ISO is not attaining ISO but keeping it, it's bad enough. To attain ISO ratings are extremely difficult. Companies take about a year to live up and meet an ISO rating. The problem is, once you get there, you’re inspected every year. And the worst thing that can happen to you is you get it and then you lose it. So you don’t want publicly losing your ISO rating. I know that because one of my current assignments is I work on a company with an ISO rating. And we are checked regularly to keep our ISO rating and woe to us if we lose our ISO rating. Because I think, there is a threat to pay among management staff and the employees if we ever lost our ISO rating. On the benchmarking, there are a lot of efforts for government for e-procurement systems and software systems and thesis, which I think, are good. However, I think it will be easier if government outsources this service to a private company who can worry about the hardware maintenance, software maintenance and all the attendant cost. Given the scarcity of resources in the government, I don’t think it got the funds to invest and re-invest. And one of the things we see in IT system is the need for constant maintenance and re-investment on both the hardware and the software side and so it seems to be more logical to subscribe to a service. I hate to mention a name, I might be accused of pitching in a name, and I’m not connected to any of those companies. I don’t wanna be accused of advertising any of them. But these companies and several other private portals, they have even created their own vertical portals for the construction and materials industry so I can't see why, the government who is practically the biggest buyer of these products, can’t go on board this things and really expand that marketplace and get all that database management as part of the fee. In the same way if you take a look at companies now, I know of companies which has stop buying equipments and they lease the equipment so that accounting treatment is just different. As far as acquisition of assets are concerned, they take capital cost, they take an operating cost. In case of the government, it’s the same thing. It takes capitol cost on it treated as part of the operating budget and pays it out annually as a fee. I think in the long run probably cheaper and more efficient for the government to cover its own IT needs in that fashion. 16 The other ones I want to react on, one of the assistant secretary’s points of view also, regarding the right of way issues and the payments, I can understand the heirs were fighting over the payments and therefore the government does not know whom to pay. In such cases, I wonder if it can be more practical to place it in a SO account so we can move on with the project anyway. Let the court settle the estate solve the problems and let the SO account pay out the heirs so the government is not stopped or the projects and the public are not inconvenienced by delays only because they are fighting over the estate. On the integrity board, which I think is a great idea, one thing, which I think DPWH can consider for integrity board is rather than hiring investigator to do the investigating, transfer part of that budget. Transfer part of the budget to the ombudsman so that you can have a third party investigator take over that function, if necessary, provided of course, they’re within their competence, if they are lawyers not engineers, depends on the nature of investigation. At the end of the day I think, this will only be cleaned up if somehow we see some penalties levied against some people who don’t perform or contractors that don’t perform. Whether we collect somehow on the performance bonds or hit them hard for re-work cost, a lot of re-work has been mentioned. I don’t know how bare the cost of the re-work is. I think we should have quality but it will be good if we publicize which contractor so that eventually you get to learn from these mistakes. But at the end of the day, there has to be some, I guess, reward and penalty system for the work done. And unless corrective action is taken, then we’ll forever have these problems on time, cost, quality, and necessity of projects. Again, at the end of the day, what we need to have is get more citizen involvement. This is what I like about the G-watch project because it’s done by non-technical persons using very basic tool to observe. I’m sure the tools can be improved over time, maybe made simpler perhaps, for other people to handle. And over time, I hope we can develop a tool kit that ordinary citizens can use. I read an article lately in India. They use students, teenagers, and very simple template to monitor projects. Maybe this is something that can be done also with schools of engineering where this can be a part of their practicum; where they can go out and actually measure project and survey work and make it a part of a 3-unit practicum course, or NTSCP, or something like this; where they can go out and actually measure roadwork, the width and all other things. They’re honing their engineering skills but at the same time doing some public service. And once we get people used to doing that, as we see some NGOs, then I think people will feel a sense of ownership over those roads. Because, well in fact, they do own those roads because they pay for them. Mr. Dondon Parafina (G-Watch): Thank you Mr. Bill Luz. I think we have a representative here from the League of Municipalities of the Philippines in behalf of Mayor Calderon. So can we hear from Ms. Li-ann? Ms. Li-Ann De Leon (LMP): Magandang umaga po sa inyong lahat. Allow me to extend our congratulations to the Government Watch of the Ateneo School of Government for conducting this very valuable study. 17 This study gives important input for national policy lawmakers and local chief executives as far as the implementation of DPWH infrastructure projects are concerned. Your findings reaffirm the guidelines and challenges being faced by the DPWH while implementing these projects. Let me share with you, after a thorough discussion with the Secretary General, Mayor Gerardo Calderon and some of the Mayors plus our consultant Professor Banlaoi, let me share with you our reaction and some important pointers to raise regarding the recommendations of G-watch. There is no simple solution to the overwhelming problems being faced by DPWH to overcome these challenges. Their recommendation was really taken account but let me give you specific comments on your 4-point recommendation and please note that our recommendations are based on your power point presentation and of course draft of your report. On delays due to peace and order problem, G-watch urges DPWH to get security assistance from the DILG and concerned LGUs during project implementation. This particular recommendation is easier said than done. First, security provision is not the responsibility of DILG or the concerned LGUs. Security is the main responsibility of the PNP and the AFP. Although the PNP is under the supervision of the DILG, the DILG itself does not have the operational resources to provide security to various DPWH projects. What DILG and concerned LGUs can do is to facilitate possible collaboration between DPWH and PNP while conducting infrastructure projects in certain localities. In fact, the Philippine municipalities have difficult issues with DILG and PNP on the supervision of police forces assigned to LGUs. It has been the battle cry of the Philippine municipalities to get back the control over the Philippine police. During our last year general assembly, the LMP adopted unanimously a resolution addressed to our President and higher authorities pressing the return of control and supervision of the police forces to the mayor. If it can’t be done due to legal impediments such as the Philippine Constitution that mandates the national police organization under the national government, the municipal mayors express the willingness to have a national police provided there. There will be local police under a two-level system. If this proposal pushes through, then the provision of security to DPWH projects by LGUs particularly will be addressed. The G-watch also recommends the development of a coordinating mechanism with DILG, LMP, LCP, Liga ng mga Barangay for the facilitation and the implementation of infrastructure projects through a MOA. There’s a need for G-watch to spell-out the nature of this MOA. What kind of facilitation that G- watch wants to have in the MOA? G-watch identifies LMP, LCP, Liga ng mga Barangay as possible partners for the DPWH to address the peace and order problem in project areas. We have four major Leagues in the local associations here in the Philippines. We have to include League of Provinces of the Philippines baka kasi magtampo sila. I hope G-watch makes further elaboration on the idea of coordinating mechanism to address the peace and order problem and to overcome delays in the implementation of the DPWH projects. Speaking of the DPWH, since ASEC is here, the LMP has an existing partnership with the DPWH on the implementation of co-sharing programs. In 1998, LMP in partnership with DPWH in municipal road projects. This partnership leads to the concreting of more than 1250 km of municipal roads benefiting more than 50 municipalities. In other words, partnership between LMP and DPWH is already in place. Wha’s needed is to sustain, maintain, and intensify this partnership in order to broaden its benefit to the Philippine municipalities. But we observe that we can facilitate the completion of infrastructure project if LGUs will be given more authority to oversee the said projects. DPWH also devolve this function to LGU. Let me take this 18 opportunity to remind the DPWH with regards to our existing partnership with regards to the 1 million co-sharing program with the 1,500 municipalities all over the country. The 1500 LGUs are waiting for the implementation of this projects. On the delays due to problem in the release of GOC to counterpart FAPs, G-watch recommends to clarify the cause of the problem, like the lack of fund. And the prospect for a solution such as exploring other alternative mode of payment. This recommendation provides a useful insight on how to deal with the problem but the recommendation is too general to grasp. To make this recommendation more useful to the stakeholders, there is a need for G-watch to identify and provide specific alternative mode of payment. Instead of saying if you want to catch a fish, then go fishing. G-watch should have recommended specific ways on how to catch the fish. For example, buying a hook, string, stick, bait, etc. on problems due to contractors fault. G-watch recommends that contracts must be reviewed and penalties must be considered. Again, this is a general recommendation. What kind of review process do we have to undertake? How much penalties do we have to impose to prevent contractors from having fault? On community role in project monitoring, G-watch recommends a participatory audit. Please, pardon our ignorance, also with our Mayor, but we feel the need for G-watch to describe further the concept of participatory audit and how this can be applied to Philippine municipalities. As far as the implementation of the DPWH projects is concerned, what I understand about participatory audit is the conduct of state audit with the involvement of representatives of civil society and private professional organizations trained and deputized as members of COA audit team. While participatory audit can minimize corruption, how can it solve the delay in the implementation of DPWH projects? These are just some of our random thoughts about the presentation and we truly appreciate the initiative of G-watch and the ASG in conducting this very worthwhile project. So I hope our comments will provide you some inputs to improve the paper and we are very grateful that you are engaging LMP salutes this very noble undertaking. Maraming salamat po. We hope that our partnership with Ateneo will be more intensified. Mr. Dondon Parafina (G-Watch): We have heard the comments of all our reactors here in the presidential table. We now open the floor to hear some comments and insights, questions from all our guests. Maybe we should hear from PCA, Mr. Lito Madrasto. Mr. Lito Madrasto (PCA): Good afternoon. Thank you for inviting us here. And to G-watch, congratulations in behalf of my organization the PCA. The result is not something surprising for us because this has been an issue that we have been discussing with government for the past five decades already. But it is something worthwhile people in this room should understand that not everything are lost. We have seen the transformation of public works and the government these past few years trying to transform to something different, something better for our people. There are things that are not touched on. And I feel I don’t know if it is by design, or really, you forgot about it. 19 The issue of the need. Is it really needed? And I go back to one area that I am now under the rest talking about the CDF and even the IRA, the project that has been mentioned by our friend Bill Luz. You’re still a Filipino, right? Let us not put the blame on DPWH because it is not a national project, the overpass, it is a local project. It is funded by IRA. When we supported the IRA when it was first thought of Senator Nene Pimentel, the whole concept is for everybody in the government even LGU to truly open. To have a wide understanding of what they need. The error here in our country is that we are myopic when we think of solution. That is the problem. Why we spend so much money unnecessarily. For example, that overpass, I realize what the problem was because my office is in that area. We’re the first building in that area, nobody else was there we were all alone. That is the Padilla Building, my building, before BENPRES, and even Lopez put up MERALCO there. So I know the situation and the traffic that they were trying to solve was not MERALCO Avenue but rather Julio Vargas. To us, in the construction industry, it was funny, why? The solution should not have been the flyover, what would have been better should have been only a depress road. Because if you notice, Julio Vargas is on top of a hill, it would have been faster, it would have been cheaper. But unfortunately, most of our local government units do not confer with the people who understand it better which is the DPWH. I have seen that so often because I always travel all over the country and I always am surprised. Why do we have this when it’s not needed? Because the solution is to address a need of a barangay not realizing that that need there is also an equal need on the other side and it would have been bridged. So that is the issue. We have come up with a situation wherein each barangay wants to think separately this state from another barangay. So you have a situation where the mayor or the province, funds a road from one barangay leading to another barangay but since the money is not enough it ends up midstream. Then the other barangay approach a congressman or a senator and he’s able to get funding and he puts up another road here. It also ends midstream. It never meets. And we throw out money unnecessarily. We have forgotten the idea of linking up, barangays to barangays, barangays to municipality, municipality to municipality, even to the provinces and to the national government. I do believe the concept of central planning is imperative. We have to think that way, we have very meager resources, and we’re throwing out away so much money unnecessarily. Because everybody wants a king of his own kingdom. S So right now, we’re surprised; we’re doing so much work but are they needed? No. I’m sorry to say, it’s not. Because a lot of things there are not link up to one another and that are something, I’ve been discussing for so long. But what can the department do? What can the intra-agencies do? They are limited only to their certain budget and to their certain projects. Another area that I'm so hacked about is the CDF; it’s the same thing. You see, the CDF, let me explain that it’s not true that the legislator holds the money of the CDF. It is still with the different agencies. Unfortunately, it was they who decide what the project is. So we go back again, is that project really needed? The project that was shown there, the bridge, I know why. It’s similar to a 5-km road that a congressman puts up on a one-kilometer per year basis. Unfortunately, those 5 kms needs 6 years to finish, because 1 km per year and then the last is the gutters. Unfortunately, on his second term he loses, so the road ends. And they hope to God that the next congressman thinks of putting up, finally, the next 2 kms, right? Unfortunately, the new congressman never won in that area so they forget that. That’s the situation we have and that’s why we were saying, why you couldn’t just identify the project. Let the infrastructure agency involved handle everything so 20 that then he can decide if he has enough money for that goddamn road. Let him start it, and it doesn’t have to chop-up. On the issue of sub-contracting, that is something that we contractors, the bigger ones, are unable to solve. We don’t know what we would do when we are faced with local politicians insisting that there are small contractors in their area and that they be given some contracts or else we don’t get the permit to work. I hope the League does something about it. Before our problem was only the province—that you have to traverse a road to a province of two provinces; then it became different municipalities; now we are confronted with different barangays. When will it end? That adds up to the cost; that adds up to the delays. The most important here the department is now working on it and the respond of the government is 9184, wherein consultants now have to do something about their work because this time if something is wrong, if there ain’t going to be variation orders, because they forgot something, then it’s going to be charged to the consultants. That is why on the consultants now, we are trying to help also; we are trying to put up the professional indemnity insurance so that they can have, themselves insured. But that does not stop there. Government has to do something about the amount that they set aside for pre-construction activities. You see, when you go overseas, planning is more important than the implementation. Here in this country, our budget for pre-construction planning even for the foreign funded is 7% - 10% of the total project value. Unfortunately, work divides the trend. The benchmark is 25%. Here we don’t like to put money in planning and that is why last year it’s zero. It’s crazy. It’s the same manner that congress takes out a budget even for training. They question why there is a budget for safety. You see when there is an accident the project is going to be delayed. If you don’t have budgets for safety considerations, then you are nearing accidents; then you are delayed. We must understand that that’s the element of construction, so planning is very important. For example, if you are going to put up a road of 20 – 50 kms, imagine how many boreholes you have to do to check the sub-strata. But if you are going to give them a budget so meager wherein instead of coming up with a borehole of every how many, 100 meters, they do it every 500 meters? Imagine what appears when you start doing work, you’re surprised what’s under. You now have to realign everything and start doing changes here and there. You know the delay of realignment is already cost additional. But then if you have to move around, if it’s additional length, it becomes more expensive, and you now have a new right of way problem to consider. When you’re talking of infrastructure, you cannot plan on paper on the table. You have to go there on the field. Right now, we have a project where we’re having problem. Two agencies are fighting it over because one insists on looking at it on an alignment based on the table. Sabi nga namin, get a helicopter and see for yourself why it can’t be going straight. Cause to go straight, you have to double the value of the project because you have to go through a mountain and tunnel through. Thank you. Dir. Ricalinda Adriatico (DBM): First, in behalf of our Secretary Boncodin, other DBM officials, and the DBM family, we would like to congratulate the G-Watch group. This is very timely considering the financial constraints of the whole bureaucracy. First, actually this is not a reaction but for the information of the group, on the issue of delayed GOP payment. It was recommended by the GOP that the DBM should develop a better and efficient payment scheme. For the information of the group, I’m sure Mr. Madrasto is very aware of this, and of course, 21 ASEC Asis, at the start of the year the DBM Secretary implemented or adopted the new payment scheme about the payment of claims of the contractors of the DPWH. Meaning, under the new scheme, DBM will issue a NCA to the government institutions. For example Landbank, the DBP or the Veterans bank, the payment should now be credited directly to the account of the creditor; it will not pass thru anymore to the DPWH for DPWH to issue MDS check. So medyo nawala na yung isang layer, madali na yung pagbayad. However, as represented by ASEC Asis a while ago, it will take 2 – 3 months for them in the processing of this documentation. So under the new scheme, the policy there is we will release the NCA based on a first in – first out policy. Meaning, that we have this cut-off date wherein the request that should be included in the payment or claims which is under the new scheme should be submitted or received by the DBM on or before of the 25th of every month. So for instance, for August, we have already processed the request received from the DPWH for the period April 26 – May 25 and as of today, of the total NCA request of the DPWH, we have already released almost 65% and the unpaid is equivalent to 35%. And for this month, I’m sure Mr. Madrasto is aware of this, we had a meeting with the Secretary two weeks ago. Then our Secretary informed the group that DBM would be releasing 3 billion starting this September. So if we will release 3 billion for September, then I’m sure the claim of the DPWH will be lessen. So that will now be less than 30 – 35 % because our unpaid to date is already 35%. We have updated our request, actually Sir, what we have right now is…well anyway, our unpaid is 9 billion. Maybe the 11 billion is still with the office, the implementing units. So that’s our policy. Ang sabi nga natin kapag ang claims ng ating mga contractors are not received within the cut-off date, so again that it will then be cued to the next payment next month. With this scheme during our meeting with the Secretary, again the PCA headed by Mr. Madrasto, recommended a new system to be adopted aside from the new payment scheme. And that’s the financing facility, which is the DBM, will issue a new payment schedule and then the bank will be the one to pay. Then the contractors will be the one to shoulder any interest in that. And hopefully, maybe we can have a meeting with the DBM and the DPWH. On the issue of the right of way problem, though we recognize that this is really a big issue on the part of the DPWH and on the part of DBM. Because as represented a while ago by ASEC Asis, the total claims for the right of way prior year is 12 billion. Of that 12 billion, we have 6 billion for the claims of region 12 alone. And what we are releasing only is only apportion of that. It’s only 639.5 million. And there’s really a pressure on DPWH and of course sa DBM. Kasi may mga Muslim po dyan na from time to time ay talagang pumupunta po sila sa amin. That’s why with the recommendation of the Secretary, the DPWH established a task force to evaluate these claims for the road right of way. As for the insufficiency of funds on both locally-funded and FAPs, again we recognize that one because talagang kulang po ang ating pondo. That’s why for 2005, when we crafted this 2005 budget, we already have this figure and we have undertaken this technical budget. We did it first to confirm this ceiling with the agency the projects to be undertaken for 2005. But again to be consistent, this has to be consistent with the 10-point agenda of the President. Ang issue kanina is kailangan ba talaga natin ang project na yan? Kailangan ba talaga natin i- implement yan? With this agenda ng ating presidente, siguro nga yun po ang priority natin. On the issue of countrywide or the pork barrel projects of the congressman, what we did for DPWH, what has been endorsed by DPWH are projects pertaining to national projects only. And for the release 22 of this pork barrel, this congressional allocations of congressmen, again the Secretary, because we have this project menu, yun po yung mga projects qualified for funding for the congressional allocations. So before, we will release SARO for these, we coordinate with DPWH. And of course, the committee on AFRO, they have to check whether these products are qualified for funding under the project menu. Again, this project menu for 2005 should, as being studied and recommended by the Secretary, should again be consistent with the 10-pt agenda of the President. Again, thank you very much for inviting us in this occasion because we believe that this is very timely. And then it’s only in this kind of undertaking wherein we could also thresh-out some problems with regards to budgetary releases and of course with budgetary problems and issuances. Thank you very much and good morning. Dir. Evelyn Baliton (Ombudsman): Perhaps I’ll comment on the preventive aspect to give significance to the corruption prevention aspect of the office or as part of the constitutional mandate of the office of the ombudsman. We will monitor the anti-corruption strategies that the DPWH has crafted and perhaps we will continue also to have some consultations with other agencies with respect to helping the DPWH in coming up with the strategies on how to address these concerns especially in the identified areas of corruption in the implementation of projects. And of course, I have also some concerns on the sanctions. I observe that during the presentation, it has been identified errors in computations attributed to human error. But if these errors are committed repeatedly, there should be some perhaps some sanctions on the apparent inefficiency of certain officers who are suppose to be expected to be more careful and more efficient in the performance of their function. And on penalties or sanctions on erring officials, there are the laws are in place so it’s just a matter of implementing these laws. Thank you. Dondon: thank you. I think we should hear from international groups. We have here representative from the World Bank, maybe we should hear from you being one of the sponsors of the project. Mr. Dominic Aumentado (WB): Good morning. First, let me congratulate G-Watch for coming up with the report and DPWH for actively participating in this review. Sabi nga nila it takes two to tango. We have heard all these findings and these are nothing new. Dondon mentioned about the DepEd textbook count, he mentioned 18 or so civil society organization participating on this undertaking, and in fact some of the grass roots levels like the PTCA. This is something I hope can be replicated in DPWH. I don’t know in what matter, but Asec Asis mentioned about 30,000 projects. I think of these 30,000 projects very few of which are really technically complex. A large number of this are simplified projects like school buildings, wherein you implement 1.8 billion budgeted school building program per year; some small water supply system; some small water drainage constructions. And these really something that the community, the civil society organization can easily monitor without the need for a complicated consultants or a technical expertise required for this projects. In fact, we all know that though DPWH and other structure projects has budget supervision, these are mostly not enough and most of the time, the supervision are not there 24 hours of the day, 7 days a week. But the communities who are the stakeholders in this project, who lives in these areas, would always be there. And it’s just a matter of, as you mentioned, making information available, the documents available; and probably the CSO teaching them or training them on the simple use of these 23 documents. Like, available ba yung schedules, available ba yung plans? Because we don’t really need consultants to know this. The committee would be able to probably measure length of market road, ilang inches ang thickness ng kada schedule. Kung school building, ilang thickness ng steel bars or even the concrete. Ano bang halo? These are something hindi na kailangan siguro ng expertise ng engineers. I’m just talking about the simple projects, I believe that with the greater community participation plus of course, your IT work making available all these information and document, more can be done, more can be improve on the way the infrastructure business in this country. In the study, you only focused on the construction side. I think these are something that is not new to us, to a lot of people anymore. But I remember when I was a young engineer; I always concentrate on the construction management. In fact, if you are very good in the construction management, you can only shorten the period of construction by so much time. But what I realize is that even if you are good in construction management, there are pre-construction activities, which actually delays the project. And if you take the over-all implementation schedule, you are even delay even if the construction is efficient. In fact talking about time, cost, quality and necessity, we should all go back upstream to what we take into consideration: the feasibility study, appraisal, pre- engineering, engineering procurement, and you will be surprise that the time, the delay in all these activities, may even be more bigger than the construction delays. And of course, because of the delays there’s a cost implication because projects that could not have been undertaken one or two years ago or implemented now, would certainly have inflation. Because of high cost now that you will have to shoulder, you have to cut on the quality not because the contractors are not complying with the quality, but because of even during the planning you have to revisit your drawings because your budget is no longer sufficient for a project planned 2 or 3 years ago. Because of this pre-construction activity delays and this we have not focused much with the RA9184, hopefully, this are given due emphasis. All these steps, particularly on the procurement aspects are given maximum time limit. Again, as mentioned by our colleague from the office of the ombudsman, its really a matter of enforcement. If the implementing agency are the responsible units are not following this time, then perhaps it’s time to do something about this. Mr. Chris Pablo (WB): I would like to add to what my colleague mentioned. Let me congratulate Toix and her group for a very interesting, provocative report. You see, we have a lot of information and analysis on causes of delays. And in fact the report prepared by the group, it’s not bad really for the public works. In fact, it points a very good picture. If you look at the reports prepared by the ADB, World Bank, it’s not as kind as what has been projected Dodjie mentioned about. It shows only half of the picture, half because it only counts actual start of the project, when actual digging starts. But it’s surprising; it did not mention procurement, which is way, much bigger problem. It’s very important because of cost implication especially for FAPs where you have to borrow money for funding. So I say it’s only half of the picture. Because if you say a year in delay, that’s nothing if you look into actual delays in implementation. But having said that, we should acknowledge that there are a lot of reforms implemented in public works, and I think this is a very good venue because we say we want to help public works improve for 24 the better and things are happening. Let me mention that they’ve done a lot in terms of streamlining the procurement processes, quality assurance as Asec Asis mentioned; there’s a lot of work being done to improve prioritization. Mr. Luz mentioned about necessity. They’re developing a more sophisticated way of identifying and prioritizing projects. They do cost-benefit allowances of sections approach. This way we will minimize the famous fly over like the one we have near our office. So I think, if we really work close to public works, we’ll see a lot of things are happening, it’s not as bad as we think. But you know a lot of work needs to be done. We welcome the effort of G-Watch in trying to develop better systems for public works. As a final comment, let me invite our friends from G-Watch to take a look at joint supervision mission reports of NEDA, the banks, ADB, JBIC and World Bank. It looks at a bigger set of projects, and you can have a better sense of how delays, problems in implementation are being addressed. Thank you. Mr. Dondon Parafina (G-Watch): Both Mr. Dodjie and Mr. Bill Luz mentioned about the participation of CSOs or the Non-Government organization in the monitoring and inspection of public works. That will definitely address the problem in sampling. Hopefully, with that kind of participation, we can cover all those projects; have they monitored by the CSOs and the NGOs. And we are optimistic that that CBCP led mobilization of volunteers for DPWH monitoring will push through. I think that signals… comments from CSOs, from the NGOs. Mr. Bill Luz. Mr. Bill Luz (MBC): Don, maybe it’s worth mentioning at this point, I wear two hats here, one is MBC, the other one is NAMFREL. And we are working with CBCP, CODE NGO, and Procurement Watch and all other groups. And the office of Sonny Marcelo to try to get more people to be on bids and awards committee to check more on the procurement and on the actual project monitoring and the implementation side of the work. We have scheduled a series of sessions, some of them for trainers, some of them for volunteers for the bids and awards committees. Starting with an orientation on September 21, and later on the actual training session in October and November. The objective is to try to place accredited and certified volunteers into selected bids and awards committees at certain levels. Mostly right now for national office projects but eventually, I suppose, if the technology is transferable and we can train enough people, I think it should also apply to local government units as well or local projects. I think it’s important at this stage to look at ways and means of getting more NGO and Civil Society participation in the projects in as much as these projects are paid for by taxpayers. I also have to think that people have a sense of ownership in projects. They will also, hopefully, not only take care of them but also pay their taxes more religiously as well. Pork barrel has been mentioned many times. That’s one of the things we should address immediately. In the case of pork barrel, it is not just, like I said, the money never goes directly to the legislator. It’s always the selection of the project, which is made by the legislator, and in fact, that’s the root of the problem. It’s the selection of problem on a political, using a political methodology or criteria or whatever you want to call it. 25 Why do we bother with development planning? Tutal someone can make a decision pala, so I mean who’s kidding whom? Why do we bother with the 5-year medium term development plan when actually 225 guys or 250 people can get to make a decision outside the development plan? Now a big rationalization says well you know it’s ok so long as it’s aligned to the 10-pt plan. First, the 10-pt plan is that it’s really hurting the situation, did not go through the whole medium term development plan process. We should really look at it in a broader context. But some of this has to have some rhyme or reasons by project are selected. And certainly, it cannot be what we see. I’m sure there are a lot of projects there in pork barrel, but we cannot judge it with just by the few good projects. We have to judge it by the methodology by which the projects are selected so we can have some consistency. We could get lucky. There are people there who are responsible, who pick good projects. But more often than not, we’re getting unlucky, we’re picking bad projects. So this is something that we should totally remove. One of the problems I see is that politicians are very skillfully shifted the argument away from pork barrel to how much are you willing to donate to bail out this government. And I think we should get back and say, look, we cannot run this government by donations. Donation skirts the real problem; it completely ignores it. In fact, donation is unsustainable. Besides, who’s going to handle our donation? Let’s face it, how many people have you heard say, I’m willing to give something but I rather give it directly to a project? Whether that project is Habitat for Humanity, or I’ll build a schoolhouse here, or Gawad Kalinga or whoever. Most people say I want to give direct. What’s the subtext of people saying I want to give direct? The subtext is we don’t trust you to spend our money. That’s the underlying message. People want to help but they don’t trust the government agency to spend their money. This is why, I’m so disturb by all these talk of let’s raise enough donations, but who do you give it to? How is it gonna be spend? All these are questions left unanswered. Let’s get back to the core problem. Let’s look at the necessity of some project and make a hard and fast decision. Resources are scarce so let’s spend them wisely. Finally, I want to react on what Lito was saying about the linkages in projects. We use to describe some projects as a road leading from nowhere to nowhere. Why is that? It’s because the matrix we use lead us to think that way. To no fault of anybody, it’s just the way it has evolved. We tend to measure everything in terms of kilometers built or lineal meters built or what have you. Actually, probably the more relevant are the connections or the intersections because that represents connectivity or connectedness. A hundred kilometer stretch or a thousand km stretch is meaningless in itself if it goes from nowhere to nowhere. But if it created many connections and intersections and connected many people, communities, and markets and helps move products, then it’s a different story altogether. I don’t know there must be a way somehow of adjusting, and I’m not an engineer, so maybe Lito and Asec Asis, they can come up with, there must be a measure of connectedness that put some relevance into this thing. In the manufacturing side, they don’t look at the production only, but they look at the value added. So we’re looking here is the equivalent of value added to that public works project. And if we could apply that same methodology as we did from national projects to local projects or to other projects. 26 By the way, the three examples earlier, Lito’s correct, they’re not DPWH projects; yhey’re actually by agencies. A city hall is by a local government; that same overpass is a local project; the Macapagal Boulevard actually is neither, it belongs to PEA, which is a state authority. So it’s one of those agencies, who have control of its own area. But the public don’t really care. It’s public money; it was built by a government agency; it is something that people see as something very wrong. And whatever that perception is, it doesn’t matter who did it, it still boils down to fundamentally the same thing, public money was used or misused or not use on a proper project for which we bore the brunt of the cost through the government so that, I think must be corrected. Dir. Evelyn Bariton (Ombudsman): Just a burning point: given all the reactions on the table and in the room, clearly we are coming together to strengthen that wider governance capacity. Clearly civil society is getting in and government need civil society to strengthen that mechanism. Already we’re to say that contestability on mechanism being reviewed and being provoked and stretch. As GOP oversight agency, I think we clearly saw that need for civil society to get into the monitoring side of the government projects. So I think its very good thing that Ateneo is here and I think talking about the sustainability of the efforts of Ateneo. As a GOP oversight, we are looking for partners in ensuring that we do our own monitoring work and bring in more objectivity to the cost base or the info base that we have in government. And I think that if we get partners from the civil society to supply us that kind of objectivity as well and I think we could have better partners we could have a better role in monitoring projects. Mr. Philip Ting (NAPC): First, I would like to congratulate G-Watch for their work. We have heard this morning words like the sense of ownership of people. I’ve heard the World Bank representative say the participation of people in monitoring of projects. I would just like to share what we have right now in NAPC in as most people know as the regional KALAHI convergence group which actually what we are trying to advocate. The guy from the construction was talking about in a sense the need for convergent planning. The sense of planning base on needs and we’d like to introduce though we already know that. Perhaps we could provoke some champions to come out into the open. We’d like to be able to introduce the idea of convergent planning which we’re trying to do sa regional convergence groups. And I’d like to refer to everyone to materials issued by World Bank on community-driven development. I believe Buban Batnagari (?) is handling that from the World Bank, that actually has a lot to say about community participation in monitoring. And one of the projects… we could call that … we could consider that as a best practice, would be the way KALAHI-CIDDS is doing its project selection. The step is one of the ways that permit the community to participate in the selection of the project, the identification of the project itself. This might have some relevance to what was said kanina, just earlier, about fitting projects to needs. So I guess that’s the point of reference to... you could consider that as a cross-disciplinary Mr. Dondon Parafina (G-Watch): It’s already 12:30, medyo gutom na tayo. So we cut the discussion at that point. But we can continue while we are eating our lunch. To synthesize what we’ve discussed, napakarami na nun, and to close this activity, may we call on the G-Watch Adviser Mr. Simon Gregorio. Mr. Simon Gregorio (G-Watch/ ASG): 27 I beg your indulgence for a few more minutes. Just to synthesize, I think the discussion today, this morning, gave us an idea that road projects are too important to be left to the engineers and contractors. I think it’s everybody’s concern especially now that we are in a fiscal crisis where money is scarce and to spend it wisely is a necessity, an imperative. There are very important points for us to consider. First is that the necessity of the project must be the top most in our mind. Whether we need the project or not is the most important. Secondly, to establish certain benchmarks and standards by which we can gauge the performance of this project. I think G- Watch has come up with several metrics or several parameters for judging time, cost, and quality. I think the challenge now is really to simplify since we know that people need to be involved. And this is not just the concern of engineers, but also we want everyone to be concerned. So I think the challenge now is to replicate and simplify the tools and to get people to participate in this monitoring. Thank you. -END- 28 PARTICIPANTS GOVERNMENT OFFICES Name Office 1 David Desamito Career Executive Service Board 2 Marcelino Hanopol Jr. Commission on Audit 3 Dir. Edgardo Diansuy Commission on Human Rights 4 Darlene May Icasiano Department of Budget and Management 5 Dir. Ricalinda Adriatico Department of Budget and Management 6 Hon. Raul Asis Department of Public Works and Highways 7 Engr. Melrose Pailma DPWH-Bureau of Construction 8 Dir. Clarita Bandonilla DPWH-Bureau of Construction 9 Dir. Antonio Molano DPWH-Bureau of Research and Standards 10 Engr. David Galang DPWH-IBRD-PMO 11 Engr. Ulyses de Guia DPWH-IBRD-PMO 12 Atty. Roline Jabalde DPWH-Resident Ombudsman 13 Li-Ann De Leon League of Municipalities of the Phils. 14 Mayor Gerardo Calderon League of Municipalities of the Phils. 15 Prof. Banlaoi League of Municipalities of the Phils. 16 Atty. Romeo Plata League of Municipalities of the Phils. 17 Dr. Virgilio Salentes National Economic Development Authority 18 Dir.Evelyn Baliton Office of the Ombudsman 19 Hon. Simeon Marcelo Office of the Ombudsman 20 Jin Miranda Ombudsman-Associate GIO III 21 Atty.Rafael Hipolito Ombudsman-GIPO 22 PCI Raymund Luzano Philippine National Police 23 PCI Susan Jalla Philippine National Police 24 PO1 Ma. Antonette Mancenon Philippine National Police 29 NON-GOVERNMENT Name Organization 1 Tony Villasor ACFOD 2 Dr. Jose Baesa Alliance of Volunteer Educators 3 Benjamin Barretto Ateneo School of Government 4 Prof. Juan Mayo Ragragio Ateneo School of Government 5 Gladys Honey Selosa Ateneo School of Government, G-Watch 6 Joy Aceron Ateneo School of Government, G-Watch 7 Redempto Parafina Ateneo School of Government, G-Watch 8 Simon Peter Gregorio Ateneo School of Government, G-Watch 9 Christopher Ragudo Boy Scouts of the Philippines 10 Nixon Canlapan Boy Scouts of the Philippines 11 Joel Pagsanghan CODE - NGO 12 Adrian Ocampo CODE - NGO 13 Josephine Castillo DAMPA 14 Evelyn Abagao DAMPA 15 Edgar Guardian FAO-PATSARRD 16 Reylynne dela Paz Fellowship of Christians in Government 17 Andie Lasala Konsyensyang Pilipino 18 Guillermo Luz Makati Business Club 19 Phillip Ting National Anti-Poverty Commission 20 Rory Tolentino Partnership for Transparency Fund 21 Joel Jaja Resco Philippine Barangay Journal 22 Manolito Madrasto Philippine Constructors Association 23 Engr. Cipriano Ravanes Jr. Procurement Watch, Inc. 24 Ky Johnson The Asia Foundation 25 Vivien Cortez The Asia Foundation 26 Christopher Pablo The World Bank 27 Dominic Aumentado The World Bank 28 Rene Manuel The World Bank 29 Flora May Cerna Transparency and Accountability Network 30 Leslie Flores Transparency and Accountability Network 30