Amendments to government procurement law sought
MANILA -The 20-year-old Government Procurement Law, or Republic Act No. 9184, needs to be amended if the problem of underspending will be addressed decisively since this is not simply a matter of inefficiency on the part of agencies, according to Budget Secretary Amenah Pangandaman.
In the second quarter of 2023, the Philippine gross domestic product grew year-on-year by 4.3 percent, much lower than the 6 percent that economists were expecting.
Compared to the first quarter, the domestic economy shrank by 0.9 percent.
This was partly blamed on a 7.1-percent contraction in government expenditures.
On Tuesday, Pangandaman told the Senate committee on finance that as of the end of June, there were P124 billion worth of outstanding bank checks—checks that have been written but not yet given or credited to suppliers and creditors.
The budget chief added that there were other factors, such as lower-than-programmed interest payments on the national government’s financial obligations and unresolved right of way issues.
She said there were also ongoing registration and validation of payees ; procurement-related difficulties such as late delivery of goods and failed biddings due to withdrawal or disqualification of bidders, unavailability of competent suppliers, and lack of or late submission of supporting documents, among others.
On Thursday, Pangandaman said in a statement that amending RA 9184 will further help government agencies address difficulties in procurement related to their programs, activities and projects—which is identified as one of the biggest bottlenecks in government spending.
She said proposed amendments to the law would be presented to President Marcos during next week’s Cabinet meeting.
Meanwhile, government agencies are expected to turn in “catch-up” spending plans by Sept. 15, as “catch-up plans” to facilitate the implementation of the 2023 national budget for the remainder of the year.
“As what I would always emphasize, we consider budget utilization rates in evaluating the absorptive capacity of agencies,” Pangandaman said.
‘We view low (budget) utilization rate (or BUR) as the agency’s limited capacity to use new funds,” she added. “However, those agencies who need to increase their utilization rates have promised to produce catch-up plans during the budget deliberations, so we hope that their BURs will increase by then.”
Further, Pangandaman said the Department of Budget and Management has partnered with Land Bank of the Philippines on the use of a digital government purchase card (GPC) for agencies’ faster procurement of immediate miscellaneous expenses.
The use of the GPC is expected to cut the time needed to liquidate government transactions and promote reduced cash handling by government agencies, operational efficiency, transparency, and accountability in the disbursement of public funds.