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Wednesday, November 02, 2005
BACs now allowed to use entire collection for honoraria
The local bids and awards committees (BAC) may now use up to 100 percent of its total collections from sale of bid documents and other bidding fees to pay for the honoraria of its head and members, the Department of Budget and Management (DBM) said.
But the DBM, in a circular released last month, said the BAC is not entitled to an honorarium when alternative modes of procurement are used.
This means that honoraria should only be released when the purchase involves competitive bidding and when the purchase of a project was successfully completed.
A procurement project shall be considered successfully completed once the contract has been awarded to the winning bidder.
Budget Secretary Romulo Neri issued Budget Circular 2004-5A to end the confusion caused by an earlier circular issued on March 23, 2004 on the guidelines on the granting of honorarium to government employees involved in procurement of supplies, goods and infrastructure.
The new circular also intends to amend and clarify the fund source for the honorarium.
Violations
The Commission on Audit (COA), in its separate annual audit report on local government units (LGUs) for their fiscal year last year, has cited common violations in the old circular. The violations include overpayment of the BAC honoraria or charging the amount to the general fund.
The reports were released last September, drawing criticisms from Gov. Gwendolyn Garcia and other local chief executives.
For Cebu Province alone, 19 municipalities were ordered to refund the entire amount they disbursed to their BAC heads and members.
The old guidelines provided that the BAC can use only 50 percent of their collections from the sale of bid documents; fees from contracts/supplier registry; fees charged for copies of minutes and bid openings, BAC resolutions and other BAC documents; protest fees; liquidated damages; and proceeds from bid/performance security forfeiture.
But the new circular that Neri issued last Oct. 7 now supersedes the circular dated March 23, 2004.
Honoraria
Section 5.2 of the new circular says a competitive bidding is negotiated when a failure of bidding occurs for the second time.
The agency then shall draw up a list of at least three suppliers or contractors who will be invited to submit bids.
But honoraria will not be paid when the purchase is through direct contracting, repeat order, shopping, negotiated procurement or when the project is undertaken by the administration, in the case of infrastructure projects.” (A negotiated procurement occurs when the agency “directly negotiates with previous supplier, contractor, consultant.)
No honoraria shall also be paid if the purchase is negotiated under Section 53 c to g of the Implementing Rules and Regulations of the Government Procurement Reform Act.
The honorarium for the head of the committee should not exceed P3,000 per procurement project, P2,500 for the members and P2,000 for the technical working group and its members.
The average amount of honorarium per month over one year shall not exceed 25 percent of the person’s basic monthly salary. (GAC)
(November 2, 2005 issue)
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