Mercado ‘cleared’ Mrs Binay in ‘overpricing’

MANILA, Philippines – Before he became the Binays’ public enemy number 1, former Makati vice mayor Ernesto Mercado was their most loyal damage-control absorber, a rabid defender against allegations of graft and corruption hurled against the Binay couple.

At one time, Mercado even argued that the Binays should not be held accountable for any wrongdoing in city hall since their job is only “ministerial” in nature.

He projected himself as a reformist, but one who would tolerate irregularities.

Twelve years later, Mercado is now saying the Binays practically dipped their fingers into all city hall contracts and got kickbacks in the process.

As early as 2002, Mercado, who was then on his first term as vice mayor, had confirmed there were anomalies and irregularities in the procurement and bidding processes of the Makati City government – from fictitious deliveries to overpricing.

But to accuse the mayor of being involved would be “unfair”, since the job is only “ministerial, he argued then.

In 2001, the Commission on Audit (COA) created a special task force to review and audit contracts by local government officials for 2000 and 2001. At the time, Mrs. Elenita Binay was the mayor of Makati (1998-2001), replacing her husband, now Vice President Jejomar “Jojo” Binay who had already served 3 terms as mayor.

The city government of Makati was among those audited by the special task force.

Questionable procurements under Mrs Binay 

In its report, the COA special task force found several anomalies in its procurement projects – from hospital equipment to computer and air-conditioning units and educational materials.

Among others, the COA team, then led by Heidi Mendoza (who later became COA commissioner), found questionable the award to procure hospital equipment to a distributor, Apollo Medical Equipment, which had a questionable identity.

Apollo Medical, the COA team said, was awarded a total of P70.561 million in transactions replete with falsification and misrepresentation, “resulting [in] undue injury amounting to P61.249 million.”

One of these transactions involved the purchase of sterilizers which cost city hall P10.339 million, when the canvassed cost only amounted to P120,500, the COA report said.

Another was the procurement of hospital beds for the Ospital ng Makati, which totaled P36.431 million when the cost amounted to only P2.447 million based on import documents gathered by COA.

Highly questionable was the fact that Apollo Medical already submitted its price canvass request, “ahead of the purchase request” by the city government by one month and 11 days.

Further investigation by the COA showed that the hospital beds, which Apollo initially claimed were from New Jersey, USA, were actually made in Taiwan, with Mabuhay 2000 Enterprises Inc as the sole distributor. Mabuhay 2000 was later renamed AgriNurture Inc, owned by businessman Antonio Tiu, who is now caught in the hidden wealth controversy involving the Binays. 

Tiu has denied acting as dummy for the Binays, specifically involving the ownership of a 350-hectare property in Batangas.

In yet another transaction, the city government procured an ultrasound machine from Apollo Medical in the amount of P7.98 million when the actual price was only P1.299 million. Worse, the model for the ultrasound machine had already been phased out by the manufacturer and a more advanced unit was available at only P925,000, COA said.

In all these transactions, COA said Apollo Medical misrepresented itself as the sole distributor of the procured equipment, “thus avoiding the conduct of public bidding.”

Books, office equipment, missing X-ray

Apart from the medical equipment, the COA team also uncovered anomalies in the purchase of educational materials and office equipment during Mrs Binay’s term.

In 2000 and 2001, the city government bought books with a total amount of 223.674 million “without securing the best term for the government contrary to provisions in DECS Order No. 35.” The COA team found out that no discounts were obtained for the purchase of the educational materials, resulting in about  P18 million in losses.

Office equipment were also procured in the amount of P7.229 million, when a separate canvass showed these only amounted to P2.394 million, the COA said.

Still, one X-ray machine, costing P1.6 million, was purchased in 1999, without any actual delivery. It was only delivered in 2001, after the COA team noted the missing X-ray machine.

Exit conference

In an exit conference conducted February 27, 2002 between city hall officials and a COA team that looked into certain procurements under Mrs Binay, several times, Mercado agreed with the COA observations that the city hall bidding and procurement system were flawed and needed to be overhauled.

“Tanggap namin ang findings, kailangan baguhin ang sistema…Aminado kami sa overpricing…,” Mercado said during the exit conference. (We accept the findings. There is a need to change the system….We admit there was overpricing.)

While candidly admitting the COA findings, Mercado said involving the mayor was not fair.

“Totoo yan hindi ko tinututulan, but it is unfair para ang Mayor ang nadedemanda, kahit sabihin pang command responsibility, ang trabaho lang ng mayor ay ministerial,” Mercado said. (We admit, I am not objecting [to the COA findings], but it is unfair to charge the mayor, even if you say command responsibility…the job of the mayor is only ministerial.)

In the case of Apollo Medical, Mercado said the company apparently tricked the city government in its transactions. “Biktima kami (We are the victims here).” He assured the COA team that Apollo Medical would be charged in court.

Mercado sought to toss the blame on corrupt government personnel who would turn a blind eye with bribes tantamount to only loose change.

“Sa gobyerno, may mga inefficient na empleyado, maraming tao na naabutan ng P200-P300 hindi itama ang trabaho,” he said. (In government, there are inefficient employees who will not do their job properly for P200-P300.)

Case filed, dropped, refiled  

On the strength of the COA findings, former Makati councilor Roberto Brillante filed graft and plunder charges against Mrs Binay and other Makati city hall officials, including former councilor Ernesto Aspillaga, who was one time a member of the Bids and Awards committee. Aspillaga had testified in the Senate Blue Ribbon sub-committee hearing that all bids in Makati were “moro-moro” or rigged.

In 2011, then acting Ombudsman Orlando Casimiro dropped the charges against Binay but pushed for the prosecution of certain city hall officials. (READ: VP Binay lobbied for General Garcia)

But current Ombudsman Conchita Carpio Morales refiled the case against Mrs Binay before the Third Division of the Sandiganbayan. The former mayor decried the move, saying the charges were dismissed in 2011. (READ: Binay camp: Mendoza’s COA report already discredited) – Rappler.com