DPWH blames contractors, slow permit application for infra delays

Aika Rey
DPWH blames contractors, slow permit application for infra delays
Public Works Secretary Mark Villar says they will suspend 43 contractors involved in more than 400 projects due to delays in implementation. This means DPWH has to bid the projects again.

MANILA, Philippines – The Department of Public Works and Highways (DPWH) Secretary Mark Villar said delays in infrastructure project implementation are caused by contractors and a long permit application process.

President Rodrigo Duterte earlier warned Villar he would be “held accountable” for delayed and failed projects. Villar said he had discussed with the President the challenges the DPWH faces with regard to project implementation.

“Nag-usap na kami at of course, sinabi ko ang mga challenges sa implementation ng infrastructure projects. Humanap kami ng changes – bibilisan ‘yang pag-apply ng permit dahil mabagal din ang approval,” Villar told a media briefing on Thursday, July 11.

(We talked and of course, I told him about the challenges in the implementation of infrastructure projects. We looked for changes, we have to speed up permit application because approval for permits take time.)

Villar was referring to permits needed from partner agencies, such as permits for right-of-way acquisitions and road blockings.

He also said they had problems with their contractors, and would suspend 43 contractors involved in more than 400 projects.

“If a certain project is delayed by 15%, that is already critical. We require them (contractors) to come up with an action plan within an acceptable time period. If they can’t follow their plan, we will cancel the contract,” Villar said in a mix of English and Filipino.

That means the DPWH would have to place the projects up for bidding again, Villar explained.

“There is a process that needs to be followed and of course, we will follow the [Government Procurement Policy Board], but we’ve already begun suspending and potential blacklisting,” he said.

‘Improved’ performance

Reacting to the recent Commission on Audit report, Villar said that the department had “actually disbursed P400 billion in 2017” for multi-year projects.

This is contrary to the audit report that said only P222.661 billion was disbursed, or 33.6% of the total P662.69-billion allocation in the 2017 budget.

“Mataas naman ang disbursement namin – P400 billion in 2017. Ang binanggit kasi nila ‘yung mga multi-year projects. Pero ang disbursement ng DPWH is P400 billion in 2017 which is the largest,” Villar said.

(We have high disbursements – P400 billion in 2017. What COA mentioned are the multi-year projects. But the disbursement of DPWH is P400 billion in 2017 which is the largest.)

Villar added that the DPWH has improved its absorptive capacity to 92% which, he said, is “the highest among agencies” – an improvement from 2016’s 50%. A higher absorptive capacity means that a government agency is able to utilize its funds for projects.

The public works chief added that contractors involved in the P326-million school building projects will repair the defects flagged by COA.

“Under the guidelines, there is a time period where these problems can be corrected by the contractors. We will not pay them until these issues are repaired. We don’t accept substandard buildings,” he said.

The recent COA report found that P73.351 billion worth of infrastructure projects were either delayed, suspended, terminated, or unimplemented.

The delay and non-implementation of projects also resulted in a very low utilization of funds for the DPWH, which cost the agency P27.647 million in commitment fees to banks.

Villar downplayed the findings and said that the department “welcomes” the suggestions of COA.

“There weren’t adverse findings in the COA report. We welcome their suggestions to continue to improve the performance of DPWH,” Villar said. – Rappler.com

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Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.