Wednesday, May 09, 2007

Corruption in public procurement . .

While surfing the internet on my leisure time, I came across this Handbook on Curbing Corruption in Public Procurement, a publication of Transparency International.

Fiscal administration practitioners and government procurement officials may find this publication interesting. Here's an excerpt:

"An avoidable misuse and abuse of public funds results from corruption. Corruption in public contracting leads to a distortion of fair competition, the waste of scare resources and the neglect of basic needs, perpetuating poverty. Massive market inefficiencies can also arise from corruption and, in the extreme, lead to the destruction of development opportunities. If corruption in public contracting is not contained, it will grow. It is estimated that systemic corruption can add 20-25% to the costs of government procurement, and frequently results in inferior quality goods and services and unnecessary purchases."

Zeroing on the Philippines, Jose Luis Syquia, formerly Executive Director of the GPPB Support Office, cited an SWS survey in 2003 that 30%-50% of government funds are wasted due to corrupt practices in procurement of books, vehicles and equipment, and infrastructure projects. By his conservative estimate, this translates to roughly Php 21 B potential leakage in government funds.

Friday, May 04, 2007

Leave Benefits of Barangay Officials a waived item!

The long wait is over for barangay officials. The DBM has issued Local Budget Circular No. 85, prescribing the supplemental rules and regulations on the leave benefits of barangay officials.

Said circular was issued to ease the restrictions provided in the original guidelines - Joint Circular No. 2004-1 issued by the DBM and CSC in March 2004. The joint circular which implements Section 81 of the 1991 Local Government Code on the leave privileges of barangay officials, specifically provides that the leave credits earned by barangay officials shall be cumulated up to one year only and shall be commuted yearly (Section 3.2); that payment of said leave benefits shall be subject to the 55% limitations on personal services; and that the leave credits earned for the particular year shall be paid in full within the first quarter of the immediately succeeding fiscal year (Section 6).

With the said restrictions, many barangay officials have not availed of their monetized leave credits mainly because their barangays have either exceeded the 55% PS cap and or cannot meet the prescribed payment deadline (March 31st of the following year) for lack of funds.

LBC 85 seeks to resolve this predicament by requiring instead that leave credits "earned in a particular year may be monetized within the immediately succeeding fiscal year" (Section 2.0); and that said benefits is waived from the PS limitation pursuant to Item viii of Section 85, General Provisions of RA No. 9401.

While some of the contentious issues surrounding the implementation of the leave privileges of barangay officials still remain unresolved, LBC 85 will enable barangay officials to eventually received their leave benefits.