SENATE Minority Leader Frank Drilon is banking on a resigned ranking official of the Department of Budget and Management (DBM) to unravel a “most unusual” P42-billion fund transfer to purchase “overpriced face masks and shields” as part of emergency measures against Covid-19.
In a statement Thursday, Drilon prodded ex-DBM Undersecretary Lloyd Christopher Lao to testify before a Blue Ribbon investigation and spill the beans on the overpriced procurement of face masks and face shields, along with other medical supplies.
The Minority Leader sees Lao, being a ranking insider, as the potential “missing link” that could help probers unravel the anomaly, which was raised anew by Sen. Imee Marcos during Wednesday’s Blue Ribbon hearing on audit reports on the Department of Health’s handling of P67-billion pandemic funds.
Marcos wanted to know, as Blue Ribbon chairman Sen. Richard Gordon was grilling DBM and DOH officials, why P42 billion in pandemic funds lodged with DOH under Bayanihan law were transferred to the DBM, with the Lao-headed DBM Procurement Service was to handle procurement of the face masks and shields, among others.
“He [Lao] leaves behind him so many questionable transactions which we will dig into,” Drilon said on Thursday, adding: “We will not leave any stone unturned in uncovering what could be a possible overpricing in [the] Procurement Service.”
The Commission on Audit (COA), in its report on DOH fund management on August 11, had questioned the transfer of monies between the two departments due to “lack of documentary requirements.”
Drilon said Senate probers are also keen to know “who is the official who directed the transfer of P42 billion? Is this done as a matter of course or is this the first time it was done? It is something unusual. A government official would be afraid to do this unless directed by somebody higher. This is what I want to find out,” Drilon said, noting “the former undersecretary quietly resigned from his post last June.”
The senator suggested that “if there was overpricing, Lao should satisfactorily explain, otherwise he might be made responsible. We are not talking here of small money.”
He affirmed that “there is a possible overpricing in the purchase of face masks to the tune of P1 billion,”
Drilon, citing the COA report, noted that the DBM-PS procured around 113,905,000 pieces of face masks from different suppliers at an exorbitant price as high as P27.72 apiece, way beyond the P2 to P5 suggested retail price (SRP) released by the DOH. During Wednesday’s hearing, Drilon asked Gordon how much the Red Cross-purchased masks last year cost, and Gordon said it was P5 each at the height of the supply crunch worldwide, but the price slid later.
The procurement of face masks, Drilon noted, cost the government around P1.66 billion in sum, double what it should have shelled out only, or “around P569.52 million.”
Drilon also suspected “possible overpricing” of face shields at P100 million.
Citing a COA report, he added the DBM-PS purchased 1,317,711 pieces of face shields at P120 each or for a sum of P158.13 million. However, he noted that the DOH’s SRP for a face shield is anywhere from P26 to P50 per piece only, far from P120.
Following the SRP of P50 for face shields, the total price should only be around P65.89 million, said Drilon.