The Commission on Audit (COA) has chastised the Procurement Service of the Department of Budget and Management (PS-DBM) for failing to implement last year's audit recommendation to blacklist the supplier of "pricey" and "outdated" laptops worth P2.4 billion for the Department of Education (DepEd).
According to the COA's 2022 annual audit report on the PS-DBM, the previous recommendation to come up with a resolution on the "termination of contracts or blacklisting of suppliers" in connection with the controversial laptop procurement deal was still "not implemented" by the PS-DBM as of Dec. 31, last year.
According to the COA, the blacklisting and termination review committee has not yet performed blacklisting proceedings over the relevant contracts; hence, no decision on contract termination or supplier blacklisting has been issued.
This contradicted the PS-DBM management's allegation that the resolution on contract termination and supplier blacklisting had already been presented to the head of the purchasing entity—in this case, Vice President and Education Secretary Sara Duterte—for final approval.
The COA's statement can be seen in the 2022 annual audit report under the "Status of Implementation of Prior Year's Audit Recommendations" section.
Under the previous administration, the DepEd made news after the COA reprimanded it for the procurement of "expensive" and "outdated" laptops worth P2.4 billion in 2021 for distribution to public school teachers.
The PS-DBM was then shown to have carried out the contentious procurement. In its 2021 management letter to the PS-DBM, the COA recommended the formation of an investigation committee to conduct proceedings and "determine the imposition of administrative sanctions" against all PS officials and employees responsible for the formulation of technical specifications and evaluation of the supplier's compliance with legal and technical requirements.
The COA further suggested that the committee "immediately conduct termination and blacklisting proceedings for the aforementioned projects" and produce a "resolution on the termination of contracts or the blacklistings of suppliers, if warranted.
The state auditor highlighted in its 2022 audit report that while the PS-DBM was able to form the inquiry committee, no resolution on supplier blacklisting was given.
Nonetheless, the COA stated that the framework agreement with the supplier eventually terminated on September 6, last year.
The supplier, a joint venture of Sunwest Construction and Development Corp., LDLA Marketing and Trading Inc., and VST ECS Philippines Inc., was apparently preferred by PS-DBM over three other bidders despite failing to meet project specifications, particularly the required clock speed and processor cache for the laptop units, according to the agency.
According to the COA, the joint venture should have been disqualified from bidding since its offered product, a Dell Latitude 3420, was equipped with an out-of-date processor, an 11th-generation Intel Core Celeron with 1.8 gigahertz (GHz) clock speed and 4 megabytes (MB) of processing cache.
The agency also stated that this was a departure from the technical parameters previously agreed upon by the DepEd and PS-DBM in their memorandum of understanding dated December 22, 2017, which stated that the laptops to be acquired should have a minimum base speed of 1.9 GHz and a processor cache of 2 MB.
The COA also chastised the DepEd in a separate 2021 audit report for accepting the PS-DBM's recommended approved contract budget of P58,300 per unit "despite the fact that the estimated price based on the DepEd's approved annual procurement plan and agency procurement request is P35,046.50 only."
The COA stated that the goods were "expensive" for an entry-level laptop, resulting in a drop in the number of acquired units to 39,583 from the original objective of 68,500 units.
