Senators grill budget, education execs over conflicting prices amid probe into 'pricey' laptops
MANILA, Philippines — Senators on Thursday grilled executivess of the Budget and Education Departments on the procurement deals for entry-level laptops meant for public school teachers, which state auditors flagged for being "pricey" for their specifications.
The Commission on Audit flagged the P2.4-billion deal for laptops that the Department of Education bought through the Department of Budget and Management Procurement Service which auditors said were too expensive yet outdated.
At the first hearing of the Senate Blue Ribbon Committee on the DepEd laptop fiasco, senators inquired about the pre-bidding stage of the transactions and found that the early documents before the budget contract was decided showed much lower prices than the final contract.
Over the course of the hearing, lawmakers established that the laptops originally cost P35,000 per the price agreed to by the DepEd before the PS-DBM conducted its preliminary market survey.
But the final price tag in the Approved Budget Contract was eventually listed at P58,000 per unit, good for a 66% increase.
'Externalities' due to pandemic
Asked about the increase, former budget undersecretary Lloyd Christopher Lao attributed it to a number of "externalities" and add-ons including the coronavirus pandemic, warranties, servicing, and software. He said that the PS-DBM initially completed the bidding in June when the price for an Intel core i5 machine was still at P32,000.
"Everyone was working from home and going online, so the demand for laptops increased...that's the reason why prices went up, because stocks were emptied. When we started the market survey, the prices went up...That's a factor," Lao said in mixed Filipino and English.
Sen. Risa Hontiveros questioned what she said were the "modus operandi, certain procedures observed since the time of former Usec Lao," pointing out that prices should have depreciated rather than increase with new laptop models coming out since then.
"Why weren't you surprised when the price increased by that much?" Sen. Ronald dela Rosa also said in Filipino. "Why were you okay with that happening?"
Citing data from the Valenzuela City Procurement Department, Sen. Sherwin Gatchalian pointed out that the over 4,000 laptops procured by the city with mostly similar specifications cost less than half at just P19,900 per unit.
PS-DBM executive director Dennis Santiago passed the buck to the Department of Education once more, saying it was the DepEd that provided the "technical requirements" before the procurement duties were handed on to the DBM.
"It is the practice of the procurement service that whenever there is a request from an agency, the procurement service would approach the market and conduct another canvass to confirm the ABC approved budget for the contract," he explained.
He added that when the DepEd submitted the documents to the PS-DBM, they had already conducted their own market survey that showed the laptops should have been priced at the original P35,000 apiece.
But the PS-DBM's own findings from consultations with suppliers like Huawei, Columbia Technologies, Bowman Tech, and VSTECS a year later reportedly yielded prices ranging from P42,000 to P58,000 for the same machines.
"Are prices rising that fast and high in market surveys if taken just one year apart? Is that possible?" Hontiveros said in Filipino.
"From P35,000 to a range of P42,000 to P60,000. Considering the pandemic, that the supply chain is broken, production is difficult, isn't it our competition among companies in this severe crisis that the price will decrease and not increase?"
Santiago responded: "These are the prices that were reflected on the record, but of course, there is a possibility that it will increase or decrease depending on demand, availability, and market suppliers available and there are so many externalities on the effect to the market price."
This comes after the DepEd deferred to the PS-DBM when the controversy first blew up, saying it should be up to the procurement service to explain the price increase and not them.
Midway into the hearing, former education secretary Leonor Briones also had to be brought to the Senate clinic for a medical check-up in the middle of the hearing. Tolentino allowed this, saying he recognized her stressful situation. Briones said she would stay "for as long as she can."
"It was your undersecretaries who made the contract and implemented it. You should be helping Secretary Briones! She's been answering for you!" the senator even said addressing other former education officials present at the hearing as he gave Briones an easy out.
Tolentino also questioned why a clause in the Food and Drug Administration law was included in some of the documents outlining the procurement of the laptops meant for public school teachers.
"What do laptops have to do with [former] FDA Administrator [Eric] Domingo? We're talking about laptops here," he said in Filipino.
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