Amid corruption probes, bills seek to abolish PS-DBM, PITC

As lawmakers continue to probe the Duterte government’s flagged pandemic-time purchases, bills seeking to abolish procuring agencies have been filed the House of Representatives and the Senate.

In the span of two weeks, four bills have been filed seeking to abolish the Department of Budget Management - Procurement Service (PS-DBM) and the Philippine International Trading Corporation (PITC), with lawmakers flagging the two agencies as prone to corruption.

The two bills at the House were filed by Deputy Speaker and Cagayan de Oro City 2nd District Representative Rufus Rodriguez, while the bills at the Senate were filed by Senator Imee Marcos.

“The DBM-PS has become a fertile breeding ground for graft and corruption and should be abolished as it has outlived its functions to the national government,” Marcos said in the explanatory note of Senate Bill 2388.

“The PS-DBM has also been hounded by allegations of improper procedure and overpriced acquisitions,” said Rodriguez in a statement after filing House Bill 10221 and House Bill 10222.

What do the agencies do?

Both PS-DBM and the PITC were created under the presidency of Senator Marcos’ father, the dictator Ferdinand Marcos.

The PS-DBM is an agency that acts as a shop for the government as it searches for equipment and supplies with the lowest prices.

Prior to the pandemic, it was most known for purchasing common office items like clips and papers, but it also procured special items like firearms and vehicles.

The PITC, meanwhile, is an attached agency to the Department of Trade and Industry (DTI). It has a broad mandate of being involved in the export and import of new or non-traditional products that are not normally pursued by private businesses in the Philippines.

The two agencies have become preferred procuring agencies of government agencies despite them having their own in-house procurement bodies. Marcos said the PS-DBM and the PITC had “outlived their usefulness,” and both already had a “miserable track record.”

A record of red flags

The PS-DBM and the PITC have long been flagged by lawmakers and the Commission on Audit during third-quarter budget deliberations, but this is the first time that lawmakers from both chambers of Congress called for their abolition.

The calls came as lawmakers probed suspected irregularities in their procurement during the pandemic, with PS-DBM entangled in the highly publicized probe into the Duterte government’s dealings with embattled company Pharmally Pharmaceutical Corporation.

The PS-DBM signed multibillion-peso deals with Pharmally despite the company being new and with little capital, and despite the company being linked with former Duterte economic adviser Michael Yang, raising the issue of conflict of interest.

The Duterte government insisted that all of the deals were well above the table, as allowed by the Bayanihan 1 law that Congress itself passed.

The PITC, meanwhile, has been flagged as an agency where government departments have tended to park billions in their funds.

In 2020, COA flagged PITC for awarding P129 million worth of contracts for personal protective equipment to a Davao City-based supplier when there were lower bids available. –

Rambo Talabong

Rambo Talabong covers the House of Representatives and local governments for Rappler. Prior to this, he covered security and crime. He was named Jaime V. Ongpin Fellow in 2019 for his reporting on President Rodrigo Duterte’s war on drugs. In 2021, he was selected as a journalism fellow by the Fellowships at Auschwitz for the Study of Professional Ethics.