Press Release
February 5, 2009

Gordon seeks changes to gov't procurement law

Independent Senator Richard J. Gordon wants the 2003 Government Procurement Reform Act amended to prevent non-government organizations (NGOs), private institutions and foundations from being deviously used in operations aimed at defrauding the government.

Gordon, chairman of the Senate blue ribbon committee, said his proposed measure is one of four recommended legislations included in the preliminary report being prepared by the committee on its investigation into the P728-million fertilizer fund scam, allegedly engineered by former agriculture undersecretary Jocelyn Bolante.

The amendment to Article 1, Section 4 of Republic Act (RA) 9184, or the Government Procurement Reform Act, seeks to include private institutions, NGOs, people's organizations and other private entities that receive monies in the coverage of the said act.

"The said law was enacted to employ much needed reforms in the country's procurement system but six years after its enactment, corruption in the public and private sector is still pervasive," Gordon said.

"The Philippines has fallen further in a global survey ranking countries in terms of perceived corruption, dropping to 141st, down 10 places from last year, among 180 countries surveyed by Transparency International," he added.

Gordon said the committee is set to propose some remedial measures intended to fill up gaps and loopholes in at least four national laws to prevent devious individuals from taking undue advantage of the present defects of these laws to defraud the government.

Three other laws proposed to be amended are the 2001 Anti-Money Laundering Act (AMLA) and its Implementing Rules and Regulations, the Secrecy of Bank Deposits Act, and the Omnibus Election Code.

Gordon said the committee wants to prevent a repeat of the fertilizer fund scam, wherein a number of foundations, NGOs and associations become agents or conduits for money laundering transactions together with officials of the Department of Agriculture (DA).

The National Organization for Agricultural Enhancement and Productivity, Inc. was identified as the foundation used as proponent in the part of the scheme that was operated by witnesses Jimmy Paule, Marites Aytona, Leonicia Llarena, Marilyn Araos, Jose Barredo, Julie Gregorio and Reden Antolin.

"With the testimonies of our witnesses, the scheme was revealed on how the foundations which were used as alleged proponents for the DA's farm input-farm implement project turned out to be conduits for laundering a large amount of funds," Gordon said.

"It is very unfortunate to learn that our poor farmers who were supposed to produce rice cannot even bring food to their own tables because the allocated fund for agriculture was pocketed by private individuals," he added.

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