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Under centralized purchases: DBM wholesaler of paperclips, ink

Next year, it becomes sole source of govt office supplies By Jan. 1 next year, all government agencies will buy some P58.8 billion worth of paperclips, ball pens, pencils, bond paper, folders, envelopes, printer ink and even hand sanitizers from one big wholesale store – the Budget Department, Senator Francis Escudero said Friday. At the same time, some P400 billion in infrastructure projects will be singlehandedly undertaken by the Department of Public Works and Highways, Escudero added. “The national government imposed centralized purchases, bidding and construction to avoid funds being anomalously converted into bonuses,” said Escudero, chairman of the Senate finance committee. “All savings are no longer convertible into cash bonuses by yearend and will now revert to the National Treasury.” Yearend cash bonuses have been uniformly pegged at P5,000 for all 1.2 million state workers and government officials and executives, including President Benigno Aquino III and his Cabinet. In the past, Escudero said, some agencies earmarked projects that they did plan to carry out so they would have year-end savings that they could use to declare bonuses for their employees. For example, the Education Department in one year might budget for the hiring of 15,000 teachers but hire only 7,000, and funnel the “savings” to bonuses. Budget Secretary Florencio Abad said government can make as much as 37 percent in savings through a “bulk sale discount” system for all “common-use supplies.” “The agencies will no longer waste time on bidding because the national government will take care of that for them. It now becomes a government-to-government transaction. The bulk purchases of common-use supplies would be cheaper and can save for the government at least 37 percent if same brand and 62 percent if of a similar kind,” Abad told the Manila Standard. Starting next year, the Budget Department will no longer release cash for most maintenance and other operating expenses (MOOE) outlays, but issue vouchers, Abad said. Escudero said the purchase of common-use supplies is provided for in the 2014 budget and is imbedded in the MOOE of each agency. But he said not all of the P58.8 billion in MOOE is under common use. “We still don’t have dis-aggregated figures for this. But I fully support this in order to have a ‘bulk sale discount’ and in order to standardize costs,” Escudero said. Abad said the allocation for infrastructure capital outlay for 2014 amounts to P400 billion. “The DPWH will also implement the infrastructure projects of other agencies, including construction of Department of Education school buildings amounting to P39.028 billion, construction and upgrading of retained hospitals and health units of the Department of Health at P2.785 billion and farm-to-market roads of the Department of Agriculture at P12 billion,” Escudero said. “It’s DPWH that has core competence to design and build infrastructure and not the agencies aforementioned,” Escudero said. In 2014, Abad said the P400-billion budget for infrastructure is close to 3 percent of the gross domestic product. In 2015, some P600 billion would be appropriated or 4.1 percent of GDP and in 2016, at least P830 billion or 5.0 percent of GDP. Abad said it would be the DPWH and Department of Transportation and Communications that would implement the projects, some of which would be under the government’s private-public partnership program. The Budget secretary said the DBM has already designed the infrastructure allocations ahead of the budget year because bidding and notices of award must be done a year before the construction begins. Marathon hearings and deliberations for the P2.268-trillion national budget for 2014 will begin on Aug. 7 with the Palace’s economic team and managers, led by Abad, to present the entire budget for congressional approval. “This is so because the DPWH and DOTC are obligated to execute the projects in the first week of January and must be completed for most in the first semester,” Abad said. He said all appropriations lapse within the year and carryover to the following years is strictly prohibited. Escudero said to augment the flat-rate P5,000 yearend bonuses, the national government this year implemented a performance-based bonus where state employees rated 90 percent or better will be able to receive from P10,000 to P45,000 in incentives. “If they perform as public servants are expected to do, and better, their P5,000 will cumulatively reach up to P50,000,” Escudero said. Escudero said the common procurement approach would pinpoint accountability and responsibility with the DBM. Excessive bonuses, including those in government-owned and -controlled corporations, were being streamlined, Escudero said, and were barred following an executive order issued by President Aquino.
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