Investigating what went terribly wrong in the procurement process of Light Rail Transit-2 (LRT-2) was one of the last official actions of the late Dante Jimenez, chairman of the Presidential Anti-Corruption Commission (PACC), before he succumbed to aortic aneurism on January 29 this year.
The LRT-2 case involves alleged indiscretions on the purchase of P170.3 million worth of equipment (such as rolling stock diagnostic tools, scissors lift and articulating boom, conveyance, among others).
Jimenez said then that his office unearthed what seemed to be a collusion among LRT-2 officials and equipment suppliers, which deserved the filing of charges against light rail officials and the companies that took part in the bidding.
The PACC cited, for instance, that what the LRT-2 received—re-railing and rolling stock diagnostic equipment—were not those that were sanctioned by the Bids and Awards Committee of the Department of Budget and Management (DBM). In particular, the sticker printout on the crate containing re-railing equipment identified it as having been shipped by CRRC Dalian Co. Ltd. Corp., as ordered by the winning bidder Kempal Construction and Supply Corp.
It turned out that what the crate actually had inside were equipment from Bemco, an Indian company. Worse, the PACC noted, the signature in the Light Rail Transit Authority (LRTA) Inspection and Acceptance Report was forged.
What becomes more intriguing is that CRRC Dalian vehemently denies having anything to do with the whole fiasco. In a phone interview, the company told BusinessWise that CRRC Dalian has never been a supplier of Kempal (BusinessWise tried but failed to get reactions from LRTA and Bemco. Only CRCC Dalian accommodated our call).
A company representative told us that CRRC Dalian has already written the PACC, the LRTA Administrator, and the Executive Director of Procurement Services (PS) under the Department of Budget and Management (DBM) to inform them that “[it] did not supply any equipment for the LRT- 2 project and that Kempal Construction and Supply Corp. is not a customer” of the company in the Philippines.
Another irregularity uncovered by the PACC concerned the escalators bought for LRT-2 stations. The LRTA ordered escalators with a required capacity of 9,000 persons per hour, but those delivered could only accommodate 6,000 persons per hour. What’s more, these escalators broke down long before their warranty date expired.
Jimenez said then that his office would forward its findings to a special task force headed by the Department of Justice. PACC is a member of the task force along with the National Bureau of Investigation, the Office of the Special Assistant to the President, the National Prosecution Service, the DOJ Office of Cybercrime and the Anti-Money Laundering Council.
LRTA spokesman Hernando Cabrera was quoted as saying that Administrator Reynaldo Berroya already ordered last year a probe involving the transaction. “We have already rendered the report and findings on the matter of the Rolling Stock Diagnostic Tools,” he said. Although the report on the re-railing tools was already being prepared, Cabrera added that “the investigation on the Scissor Lift and Articulating Boom, and Conveyance is still ongoing.”
This LRT-2 case highlights how public procurement is particularly susceptible to corruption, providing a lucrative source of “livelihood” for the best briber and the corruptible government official. Public office is clearly misused when procurement rules are violated or when legitimate deviations are made. Worried about substandard government infrastructure? Check the padded pockets and bank accounts of those involved in the purchase of public goods and services. The scourge of corruption in any form—graft, embezzlement, bribery, lobbying, extortion, cronyism, nepotism, parochialism, patronage, and influence-peddling—has long been the national headache that won’t go away.
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