Nene: House too quick to clear World Bank contractors

Senate Minority Leader Aquilino Pimentel Jr. said yesterday that the decision of the House of Representatives to clear the contractors banned by the World Bank (WB) for alleged collusion and bid rigging is premature.

He also revealed that upon his request, the World Bank has agreed to submit evidence of the alleged bid rigging of government road projects that would be the basis for the criminal prosecution of public officials and contractors involved in the anomalies.

“A top official of the World Bank in the US has agreed to provide the necessary evidence that can be the basis of criminal prosecution of those involved in the collusive practice,” Pimentel told reporters during the weekly Balitaan sa Rembrandt Hotel in Quezon City.

Pimentel said he contacted his source at the World Bank headquarters and asked if they are willing to provide the Philippine government with the evidence that was the basis of their decision to blacklist several contractors and ban erring contractors in road projects funded by the bank.

The World Bank has reportedly submitted copies of the report to the Department of Finance and the Office of the Ombudsman.

Pimentel said the evidence was gathered through a careful and intensive process of investigation and evaluation of the bank’s investigative office, the Integrity Vice Presidency (INT).

INT is tasked with the investigation of fraud and corruption in bank-financed projects. It reports directly to the president of the World Bank and is staffed by expert investigators, legal specialist, and forensic experts.

Pimentel declined to give details of the evidence obtained by the INT during its investigation but said it can be the basis for the criminal prosecution and would expose the identities of government officials and contractors who conspired to rig the projects.

“The criminal cases may involve graft and corruption and other criminal offenses depending on integrity of the evidence,” he said.

He also said that the House of Representative must be prepared for the explosive evidence that he will present to the Senate as soon as he gets hold of the World Bank report.

“Those involved in the collusive practices would not be happy but with the cooperation of the WB we can now pinpoint personalities involved in the anomaly,” he said.

The bank had earlier stood pat on its findings, saying that the sanction board came up with the decision after a thorough investigation by its investigative body of forensic and legal experts.

Bert Hofman, World Bank’s country director in the Philippines, said in a letter to the Senate that the investigation found evidence that several firms and individuals have engaged in collusion in connection with two contracts under the project.

Hofman said all of the firms and individuals in the case were given ample opportunity to defend themselves. They all received the bank’s notice of sanction proceeding in May 2008 and were given 90 days to submit their response and contest the allegations against them. The companies could request for a hearing before the sanctions board, and sources at the WB said some of them did so.

Senator wants tougher laws

Sen. Panfilo Lacson proposed a tougher government procurement law to protect taxpayers from corruption, after it was found that the contractors banned by the World Bank were able to win other government infrastructure projects.

Lacson also urged Sen. Miriam Defensor-Santiago to continue with the investigation into the alleged collusive practices of contractors in bidding for government projects as exposed by the WB to determine the right amendments to the country’s laws.

He said the implementing rules of Republic Act 9184 or the Government Procurement Act should include the ban of a contractor by a foreign agency as enough bases to disqualify it from bidding on government projects.

“Under Section 23.6(d) of the present implementing rules and regulations, a bidder is qualified to join the bidding if it is not blacklisted or barred from bidding by the Philippine government. We should toughen our procurement law by making blacklisting by a foreign agency like the World Bank a basis for disqualification. This is one way to protect our procurement system from corruption,” he said in a statement.

Lacson lamented that the Department of Public Works and Highways (DPWH) allowed some contractors banned by the World Bank to continue bidding on government projects, which again embarrassed the country before the international community.

Even if the government invokes the implementing rule to justify the continued participation of the blacklisted firms, this will send the wrong signal to the world that the Philippines tolerates or encourages corruption, Lacson said.

“This is especially glaring considering that one of the contractors who was blacklisted but still allowed to bid has been shown to be close to very powerful personalities,” he said.

During the Senate hearing on alleged collusive practices among contractors that marred WB-funded projects, Lacson cited entries from an appointments book of First Gentleman Jose Miguel Arroyo showing the President’s husband met at least 20 times in 2002 alone with Eduardo de Luna, one of the contractors banned from World Bank-funded projects.

He said the Ombudsman should be taken to task for sitting on the case of the Filipino contractors blacklisted by the WB.

Documents reaching Lacson showed the WB transmitted its findings to the Department of Finance on Nov. 16, 2007. The DOF forwarded this report to the Office of the Ombudsman on Nov. 19, the next working day.

“Had the Ombudsman performed their task, the firms could have been blacklisted and the story would have been different,” Lacson said.

Lacson said the Senate should continue the public hearings on the scandal involving World Bank-funded projects, “with or without eyewitnesses” to a P70-million bribery attempt in April 2003.

He said Santiago must allow the Senate and the appropriate committee to revisit the law and expand the coverage of blacklisting entities to include financial partners in implementing projects.

Lacson also ignored a deadline imposed on him by Santiago to produce a witness to the supposed link between the First Gentleman and De Luna, president of E.C. De Luna Construction Corp.

De Luna allegedly brought P70-million bribe money to the LTA Building in Makati City where the First Gentleman used to hold office in order to get a P1.4-billion road project.

Lacson questioned Santiago’s sudden termination of the inquiry into the WB’s expose as she gave Lacson two weeks to convince his witness to testify on the bribery and collusive practices among contractors and government officials or people close to Malacañang.

Senate President Juan Ponce Enrile said without a witness, Lacson’s story would only be hearsay since the appointments book showing that Mr. Arroyo and De Luna met a number of times in 2002 would not be enough to prove his allegations.

“I’m sorry that Senator (Santiago) is missing the point. The core issue contained in my resolution is the blacklisting of the Filipino construction firms because of collusive practices. The mention of the First Gentleman was incidental because of his closeness to one of the blacklisted firms,” Lacson said.

“The investigation must be continued to find out how Republic Act 9184 could be implemented properly, especially the bidding processes,” Lacson added.

Lacson said the First Gentleman has more to explain than just the fact that the First Gentleman and De Luna know each other.

Minority Leader Pimentel said he could not expect the House of Representatives to conduct a fair hearing on the matter because they were profiting from Malacañang.

The House members did not pursue the alleged link between the First Gentleman and De Luna and even cleared the contractors of collusive practices, contrary to the findings of the World Bank.

Both local and foreign firms blacklisted by the World Bank were still permitted by the administration to undertake government projects. – With Aurea Calica