COA scores DPWH for ₱118-B delayed projects

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Metro Manila (CNN Philippines, September 3) — The Commission on Audit (COA) slammed the Department of Public Works and Highways (DPWH) for the delayed delivery of some ₱118 billion worth of projects in 2018.

In an annual audit report, state auditors said the agency has been slow to spend its ₱752.1-billion budget last year, having actually released only 39.7 percent or ₱298.4 billion by yearend. Some ₱55.9 billion have not been obligated as of December.

"The low disbursement rate in calendar year 2018 was mainly attributed to the delayed and non-implementation of currently obligated projects, which deprived the intended beneficiaries of the immediate access to safe and reliable road network systems, school buildings, health facilities, and reduced vulnerability of flooding," COA said.

Actual disbursements continued to lag, with the COA saying that DPWH did not "effectively manage" how it handles the billions of pesos earmarked for agency projects.

The DPWH is at the forefront of the government's "Build, Build, Build" program and received the second-biggest allocation that year.

Economic managers: Gov't on track, infra projects not delayed

Auditors also scored the DPWH for ₱118.4 billion worth of projects that remain delayed or not implemented due to poor coordination with local government units (LGUs) and partner agencies and inadequate feasiblity studies.

The undelivered projects were mostly school buildings and farm-to-market roads. Some 3,784 projects worth ₱107.2 billion were not completed by the contract deadline, 291 were suspended, 18 projects terminated, and 222 were not started at all in 2018.

The DPWH pinned the blame on typhoons and bad weather, local peace and order situation, road right-of-way, pending permits from LGUs and from other agencies, changes in design and construction plans, lack of workers, insufficient equipment, scarce raw materials, inaccessible project sites, inadequate supervision, and the late release of funds.

But government auditors said that apart from weather conditions, all other issues "should have been considered and resolved during the preliminary engineering study" on projects and pre-construction activities.

COA added that the agency should have cancelled the contracts for 157 projects worth ₱5.6 billion for exceeding the 10 percent cap for project delays. It added that these issues have been raised in 2017, but were not "properly addressed."

'Challenge accepted': Villar confident DPWH can complete projects

In its response to the COA findings, the DPWH said its offices have sent demand letters for contractors to fast-track project completion, while officials have been told to monitor all remaining contracts. It added that the agency is "committed" to ramp up construction and spending.

These delays also cost the government some ₱84 million in commitment fees for projects funded through loans and grants. These include the Asian Development Bank-funded Improving Growth Corridor in Mindanao Road Sector, where the DPWH was billed ₱20.4 million for a slow start.

"The delay in the implementation of the project resulted in the deferment of the delivery of services that could have been derived from the immediate use of the project," COA said, noting that slow progress on loaned funds could mean a bigger bill for the Philippine government.

COA auditors also discovered ₱106.6 million worth of unrelated expenses and ₱65 million worth of "irregular and unnecessary" spending from DPWH's books.

DPWH Secretary Mark Villar previously said that they hit a fresh high on spending last year, and that they are now back on track with infrastructure targets for 2019 despite a four-month delay in this year's budget.