1. One UP. One University. One Procurement System.
Isagani L. Bagus
Acting Chief, UP System SPMO
UP Manila
25 November 2014

2. House Rules Turn off or put in silent mode all mobile phones
Take phone calls outside the Conference Room
Address questions/clarifications to the speaker
Active participation is highly encouraged
Stay awake

3. Training Objectives
Train the UP Manila personnel on procurement process as per Republic Act 9184 Implementing Rules and Regulations;
To have a uniform interpretation on the procurement process and procedures; and
Gather feedback that shall serve as a guide to help UP improve the system on procurement in all aspects and improve the quality of service that University is providing.

4. Is Procurement a Problem in UP Manila?
Question?
Is Procurement a Problem in UP Manila?

5. Answer
proCUREment

6. Common Questions in all CUs
Why procurement process is very long?
Why it took procurement more than a year?
Why specifications is wrong?
Why failed bid?
Why wrong posting in PhilGEPS.Announcement?
Why … Why …. Why

7. Solution to the Questions?
B. L. A. M. E.
Bakit
Lagi
Ako ang
Mali
Eh di naman

8. P.B.B. on Procurement P
Procurement
Process B
Best
PRACTICE

9. P.B.B. on Procurement P
Procurement
Process B
Bad
PRACTICE

10. Q and A

11. Present Status on Procurement of UP: Policy Implementation

12. Constituent U’s of UP UP Min UP Cebu UP System UPD UPM UPLB UPV UPB
UPOU
UP Min
UP Cebu

13. UP: One UP. One University. One Procurement System
UP System
UPD
UPM
UPLB
UPV
UPB
UPOU
UP Min
UP Cebu

14. Republic Act 9184? Procurement Law of the Philippines
Includes the following:
Implementing Rules and Regulations on Procurement
Procurement Policy and Procedures of the Philippines
Executive Orders
Govt. Procurement Policy Board (GPPB) Resolutions
PhilGEPS Requirements
Others: COA, UP, DBM, Procurement Service

15. Nature of Procurement

16. Nature of Procurement Infra Services Goods
Example: equipment, furniture, stationery, materials for construction, or personal property of any kind, including non-personal or contractual services, such as repair and maintenance of equipment and furniture, as well as trucking, hauling, janitorial, security, procurement of supplies and materials, etc.
Infra
Example: construction, improvement, rehabilitation, demolition, repair, restoration or maintenance of roads and bridges, railways, airports, seaports, communication facilities, civil works components of information technology projects, irrigation, flood control and drainage, water supply, sanitation, etc.
Services
Example: requiring adequate external technical and professional expertise that are beyond the capability and/or capacity of the GOP to undertake such as, but not limited to: advisory and review services; pre-investment or feasibility studies; design; construction supervision; management and related services; and other technical services or special studies.

17. Q and A

18. Major Stakeholders of Procurement in UP

19. Major Stakeholders of Procurement
End-User
Budget Officers
SPMO/BAC Secretariat
BAC Members
TWG Members
Accountant
Internal Auditor
Observers / Resource Persons
H.O.P.E.

20. Functions of Stakeholders

21. End-User Prepare the following: PPMP Technical Specifications
Particulars
Remarks
Specifications
- Consult the expert
Complete and generic (No brand please/equivalent)
Do not copy brochure/catalogue being issued by supplier
Range for minimum and maximum
After Sales
Warranty
Insurance
Training of personnel
Delivery period
Be realistic

22. End-User Approved Budget Ceiling Particulars Remarks Cost
Do not copy the brochure/catalogue provided by supplier
Value Added Tax
Included 12% VAT
Additional Warranty
Request for a costing if there is additional warranty
Bid Documents
Cost of Bid documents might also consider in computing ABC
Value for Money
Do not delay payment to supplier/s

23. Budget Officer Issue Budget Clearance / Availability of Funds
DBM Funds, UP Funds, or other source of funds
Expiration / End of Life of SARO / Budget Clearance

24. SPMO / BAC Secretariat Assist the BAC in the conduct of its functions
Serve as the main support unit of BAC
Post the Invitation to Bid in PhilGEPS, Bulletin Board, Website, and Newspaper (if necessary)
Receive suppliers queries/questions and other documents address to BAC
Prepare the bidding documents (before and after procurement)

25. Members of the BAC Advertise and/or post the Invitation to Bid
Conduct pre-procurement and pre-bid conferences
Determine the eligibility of prospective bidders
Receive bids
Conduct the evaluation of bids
Undertake post qualification proceedings
Recommend award of contracts the event to the HOPE

26. Technical Working Group
Review the specifications submitted by end-user during pre-procurement conference
Conduct evaluation on the specifications submitted by end-user
Evaluate the proposal of supplier on technical specifications
Conduct ocular inspection if necessary

27. Accountant Issued Availability of Funds
Evaluate the NFCC submitted by bidder/s
Obligate the funds after delivery
Prepare other COA requirements

28. Internal Auditor Serve as observer of the Public Bidding
Re-examined the procurement if compliant with Republic Act 1984 and COA provisions

29. Observers
To enhance the Transparency of the procurement process, the BAC shall in all stages of the procurement process, invite, in addition to the representative of the COA at least two (2) observers to sit in procurement proceedings
The observer should meet the criteria of observer as set forth in the IRR

30. Head of Procuring Entity
Approved or Disapprove the recommendation of the BAC
Constitution of BAC members
to award the contract to the winning bidder
BAC Resolutions

31. Delineation of Authority
Delegated Approval Ceilings
Board of Regents
Construction and repair, including construction management services
Purchase of equipment, materials, supplies, and services
Above Php75M
President
Php75M
Chancellors
UPD, UPLB, UPM, UPV:
Php25M
UPB, UPMin, UPOU, and UP Cebu
Php15M

32. Q and A

33. Mode of Procurement

34. AMP: Emergency Pucrhase
Mode of Procurement
Shopping
Public Bidding
AMP: Negotiated
AMP: Repeat Order
AMP: Emergency Pucrhase
AMP: Others

35. What is Small Value Procurement?
Where the procurement does not fall under Shopping in Section 52 of the IRR and the amount involved does not exceed the thresholds prescribed in IRR
Requirements: Three (3) quotations from Bona fide Suppliers
Thresholds: Below Php50, and below

36. Flow Chart for Small Value P50,000 and below
Purchase Request
End-User
Budget Clearance
Budget Office
Posting to PhilGEPS
SPMO/BAC Sec.
Delivery and Payment
Preparation of Procurement Documents
SPMO

37. NEW Flow Chart for Shopping P50,000 and below
Purchase Request
End-User
Budget Clearance
Budget Office
Posting to PhilGEPS
SPMO/BAC Sec.
Delivery and Payment
Preparation of Procurement Documents
SPMO
Request for
3-Quotations

38. Q and A

39. Shopping
Shopping is a method of procurement of goods whereby the procuring entity simply request for the submission of price quotations for readily available off the-self goods or ordinary/regular equipment to be procured directly from the supplier of know qualifications
Requirements: at least three (3) price quotations from bona fide suppliers; Purchase Request, Budget Clearance, Complete specifications (note: no brand name, and lock-in to a certain brand/specifications)

40. Shopping PRESENT Flow Chart for P100,000 up to P499,999.99
Purchase Request
End-User
Budget Clearance
End-User (at least 2 days)
Posting to PhilGEPS
SPMO (at least 7 – 9 days)
Delivery and Payment
Preparation of Procurement Documents
SPMO (within 3 days)

41. Q and A

42. Public Bidding
All procurement shall be done through competitive bidding, except as provided in Rule XVI of RA 9184 – IRR
Amount subject to Public Bidding: Php500, and above
Requirements:
Budget Clearance (dont use catalogue price as much as possible, includes cost of bid documents, value added tax)
Purchase Request (conduct intial canvass from bonafide supplier)
Complete Specifications (dont copy the catalogue specifications, no lackin)
If infrastructure/renovation: plans are needed, bill of quantities of materials, complete specifications)
If services (Terms of Reference)
PhilGEPS posting (Newspaper posting if Php2M and above)

43. Public Bidding: ABC Php500 to P2 Million
Purchase Request
End-User
Budget Clearance
Budget Office
Posting to Phil GEPS
SPMO
1-day
Public Bidding
BAC
(12 days)
Pre-Bidding Conf.
(7-days)
Pre-Proc. Conf.
SPMO
3-days

44. Public Bidding: ABC Php2 Million and Above
Purchase Request
Specifications
Proposed Budget
Budget Clearance
BUS/BUR
Availability of Funds
Pre-Proc.
SPMO/BAC Sec.
BAC
PhilGEPS/ Newspaper/ Bulletin Board
- SPMO/BAC Sec
Pre-Bidding Conference
TWG/E.U/Observer
- BAC/BAC Sec.
Public Bidding

45. Simple Question and Answer
Can we bid less than Php500,000.00?
Answer:
Yes
Why?
The Default of procurement is public bidding, when in doubt ….. Public bid

46. Q and A

47. Negotiated
Procuring entity directly negotiates a contract with a technical. Legally and financially capable supplier, contractor or consultant
Cases to undergo Negotiated:
Two Failed Bidding
Emergency cases
Take-over of contracts
Adjacent or contiguous
Agency to Agency
Procurement Agent
Highly Technical Consultants

48. Repeat Order Procurement of goods from the previous winnig bidder
Unit price of the repeat order must be the same as or lower than those in the original contract
Not result to splitting of contracts
Within six (6) months from the effectivity of the contract stated in the NTP
Not to exceed 25% of the quantity of each item in the original contract

49. Emergency Purchase
In case of imminent danger to life or property during a state of calamity, or when the time is of the essence arising from natural or man-made calamities or other causes, where immediate action is necessary
Actors in Emergency Purchase: Argentinian and Russian

50. Flow Chart End-User BAC Chair
Write a letter of Request for Emergency Purchase after purchasing of Goods, Transportation,
And other expenses
SPMO
Recommend or not to recommend the request for emergency purchase
BAC Chair
Approve or dis-approve the request for emergency purchase
Accounting

51. New Flow Chart: Emergency Purchase
End-User Prepare for Voucher with supporting documents
Accounting Office Evaluate the reimbursement
Cash Office Payment

52. Q and A

53. Annual Procurement Plan (APP) Procurement Planning and the Preparation of the Annual Procurement Program/Plan and Amendatory/Supplementary Program/Plan

54. Annual Procurement Plan
Procurement Planning is the first step in the procurement process. This may consist of the preparation of a procurement plan or procurement program.
An APP refers to the itemized list prepared by the Head of the Agency showing the kind, estimated quantity, estimated cost, description of supplies together with the balance on hand, if any, required by the agency for the ensuing fiscal year.

55. Applicable Laws on APP
Section 3.2 of the IRR of E.O No. 302 dated Feb. 19, (Procurement Planning)
Procurement of goods shall be undertaken according to a procurement plan that the agency concerned shall formulate to ensure that the goods to be procured are available when needed.
Section 424 of GAAM
An Annual Procurement Program showing itemized quantity, description and estimated cost of supplies/materials/equipment required for a fiscal year shall be prepared by all agencies of the national government

56. The APP shall include provisions forforeseeable emergencies based on
The APP shall include provisions forforeseeable emergencies based on historical records
No procurement shall be undertaken unless it is in accordance with the approved APP
The end-user units shall prepare the respective Project Procurement Management Plan (PPMP) for the different programs, activities, and projects (PAPs)
Updating of the PPMPs and the consolidated APP shall be undertaken every 6 mons or as often as may be required by the HOPE.

57. Forms of PPMP and APP
PPMP PPMP.doc
APP APP Format.xls

58. UP System APP and PPMP

59. UP System APP and PPMP

60. UP System APP and PPMP

61. UP System APP and PPMP

62. UP System APP and PPMP Php103,281,338.03 UPS Office Goods Service
Infra l
TOTAL
72,752,671.33
3,528,666.70
27,
Php103,281,338.03

63. Illustrative Case Nature: Purchase of medicines Annual
Procurement Program
Decision No.:
COA Decision No dated Dec. 1, 1992.

64. Illustrative Case
Particulars: This is an appeal dated January 20, 1992 of the Executive Director, Philippine Trade Training Center (PTTC) to lift the disallowance on the purchase of medicines amounting to P4, The amount was disallowed by the Auditor for lack of legal basis for the charging of the expenditure to Fund 101 object codes 07(supplies) and 19(representation expenses). The Executive Director, in his appeal cited the provision of Occupational Safety and Health Standards Law which states that every employer including the government shall keep in the workplace a minimum medical facilities listed in Table 47 of the law.

65. Illustrative Case
The facilities listed therein maybe substituted with other comparable medicines. The appeal was granted. The cost of the medicines/medicinal supplies purchased can be validly charged against the allotment for supplies and materials (07) under Fund 101 as long as these medicinal supplies are included in the Annual Procurement Program of the agency in support of the Work and Financial Plan of the agency as approved by the Department of Budget and Management (DBM) or to the allotment for extraordinary and miscellaneous expenses (18) authorized under Section 26 of the 1991 General Appropriations Act.

66. Benefits of PPMP and APP
An effective plan saves time and money
An effective plan serves as a conduit to achieving entity’s objectives
An effective plan ensures compliance with regulatory policies
An effective plan provides a framework to guide procurement officers in the achievement of their tasks and duties.

67. Q and A

68. Updates on the Revised Implementing Rules and Regulations (IRR) of Republic Act No. 9184

69. Guidelines on Ordering Agreement

70. Guidelines on Ordering Agreement
GPPB Resolution dated 27 January 2012
Expands the application of Ordering Agreements to the following:
Expendable and Non-expendable Goods
Services for Hotel Accomodation, Air Travel, and Repair and Maintenance

71. Guidelines on Ordering Agreement
Ordering Agreement – written agreement in the nature of an option contract between the PE and the winning bidder granting the PE the option to either place an order for any of the Goods identified in the Order Agreement List or not buy at all, within a given period of time.
Order Agreement List (OAL) – list of Goods, and their corresponding technical specifications, scope of work, projected quantities, and fixed prices, subject of the Ordering Agreement.

72. Guidelines on Ordering Agreement
Delivery Order Contract – contract that authorizes and obligates a supplier/service provider to deliver certain quantity or render a particular service within an agreed period and at a fixed price per unit, item or identified service pursuant to an Ordering Agreement.

73. Guidelines on Ordering Agreement
PPMP
APP
Competitive Bidding
Ordering Agreement
Delivery Order Contract
Termination

74. Policy relative to DOLE DO 18-A
DOLE DO 18-A (14 November 2011)
Issued to address unscrupulous undercutting of contract rate by service providers (e.g., security and janitorial)
Requires that administrative cost should not be less than 10% of the total contract cost

75. Sample STANDARD COMPUTATION Payable Directly to Servicemen: 6,500.00
a. Basic Salary
b. Night Differential
c. Emergency COLA
d. 13th Month Pay
e. Service Incentive Leave Pay
Payable as Employee’s Share:
500.00
a. Social Security Premiums
b. Philhealth Premiums
c. ECC Insurance Premiums
d. Pag-ibig Fund Contribution
Total Cost
6,000.00
10% Administrative Cost
600.00
Possible Bid Price
6,600.00

76. Policy relative to DOLE DO 18-A
GPPB PM dated 30 November 2012
Section 9 (b) (ii) of DOLE DO 18-A prohibits bidders from offering bids lower than the sum of the Total Reimbursable Costs and 10% Administrative Cost.
Scenario results in the imposition of floor in bid prices.
Runs counter to Section 31 of RA 9184.
GPPB is of the view that Section 9 (b) (ii) of DOLE DO 18-A should be considered INVALID, and thus, cannot be a source of any right, duty, obligation, or power.
Reiterated in GPPB PM dated 11 April 2014

77. Bid Securing Declaration…

78. Bid Securing Declaration
GPPB Resolution dated 27 January 2012
Adopts Bid Securing Declaration as an additional form of bid security
A document/undertaking signed by the bidder committing to pay the corresponding fine and be suspended for a period of time from being qualified to participate in any government activity in the event of violation of any of the conditions stated therein as required by the GPPB Guidelines.

79. Bid Securing Declaration
Section 27, RA 9184
All Bids shall be accompanied by a Bid Security, which shall serve as a guarantee that, after receipt of the Notice of Award, the winning bidder shall enter into contract with the Procuring Entity within the stipulated time and furnish the required performance security. The specific amounts and allowable forms of the Bid security shall be prescribed in the IRR.

80. Bid Securing Declaration
Existing forms
Have substantial monetary value.
Increases transactional costs and bid prices.
Bid Securing Declaration
Insignificant monetary value
Increases bidder’s participation
Decreases the transactional costs
Reduces bid prices

81. Bid Securing Declaration
Period of Effectivity
Reasonable period determined by the HOPE
Not to exceed 120 calendar days from the date of opening of bids (unless duly extended by the bidder upon the request of the HOPE)

82. Bid Securing Declaration
Automatic Expiration
Bid validity period or any extension expires
All bidders are declared ineligible or post-disqualified (no request for reconsideration filed/waiver is filed)
LCRB/HRRB furnishes the Performance Security and signs the contract

83. Bid Securing Declaration
Grounds for Enforcement
Withdraws bid during bid validity period; or
Fails or refuses to accept award and enter into contract or perform any and all acts necessary to the execution of the contract, in accordance with the bidding documents, after having been duly notified of the acceptance of its bid during the bid validity period

84. Bid Securing Declaration
Penalties
Automatic blacklisting for 2 years in ALL government procurement activities, and
Payment of fine
For multiple bidders: difference between the evaluated bid prices of LCRB/HRB with the next LCRB/HRB.
In case bidder is the LCRB/HRB, the amount shall be based on the difference between the evaluated bid price and ABC.
For a single bidder: difference between the evaluated bid price and ABC.

85. Payment of Fine Approved Budget for the Contract
Penalty of 3rd Lowest or Single
Third Lowest or Single
Penalty of 2nd Lowest
Second Lowest
Penalty of Lowest
Lowest
PhP 10,300,000.00
PhP 700,000.00
PhP 9,600,000.00
PhP 400,000.00
PhP 9,200,000.00
PhP 99,001.00
PhP 9,100,999.00
Back

86. Sale of Bidding Documents…

87. Sale of Bidding Documents
GPPB Resolution dated 24 February 2012
Provides standard rates for the sale of bidding documents
Rationalizes the fees
Regulates price of Bidding Documents
Lessens the exercise of discretion of PEs
Encourages market participation and competition

88. Sale of Bidding Documents
Approved Budget for the Contract
Maximum Cost of Bidding Documents in PhP
500,000 and below
500.00
More than 500,000 up to 1 Million
1,000.00
More than 1 Million up to 5 Million
5,000.00
More than 5 Million up to 10 Million
10,000.00
More than 10 Million up to 50 Million
25,000.00
More than 50 Million up to 500 Million
50,000.00
More than 500 Million
75,000.00

89. Policy on TWG Membership

90. Policy on TWG Membership
GPPB Resolution dated 27 April 2012
Adopts an official position relative to HB 5366
HB 5366 seeks to amend RA 9184 by appointing a “third party” from either a recognized academic institution or from a government office that is not part of the organizational structure of the procuring entity as a BAC member with respect to the procurement of highly technical equipment by the AFP and the PNP
“Third party” seen to help in evaluation of eligibility of bidders and technical specifications imposed by the bidding documents

91. Policy on TWG Membership
GPPB Circular dated 3 August 2012
Section 12.1 of the revised IRR of RA 9184 allows the BAC to create a TWG from a pool of technical, financial, and/or legal experts to assist in the procurement process
TWG need not be limited to the employees or officials of the PE
BAC may engage the assistance of other government personnel and officials, and consultants from the private sector and academe with proven expertise

92. Eligibility Criteria on Infrastructure Projects

93. Submission of Letter of Intent

94. Submission of Letter of Intent
GPPB Resolution dated 23 November 2012
Deletes Sections and of the Revised IRR of R.A. 9184
Provisions requiring the submission of a written LOI and/or application of eligibility together with the latest Class “A” Documents in case the procuring entity maintains a registry system using the PhilGEPS or its own electronic system.
Rationale:
Harmonize with the rules on the use of the GOP-OMR
Prevent collusion among bidders

95. Submission of Statement of Ongoing and Completed Contracts

96. Submission of Statement of Ongoing and Completed Contracts
GPPB Resolution dated 23 November 2012
Amends Section 23.1(a)(iii)
Statement of the prospective bidder of all its ongoing government and private contracts, including contracts awarded but not yet started, if any, whether similar or not similar in nature and complexity to the contract to be bid, within the relevant period as provided in the Bidding Documents
Statement identifying the bidder’s single largest completed contract similar to the contract to be bid, except under the conditions provided for in Section of the IRR, within the relevant period as provided in the Bidding Documents in the case of goods.

97. Financial Eligibility Requirement

98. Financial Eligibility Requirement
GPPB Resolution dated 30 July 2013
Amends Secs. 23.1(a)(vi), , and of the GPRA IRR
Credit line commitment (CLC) is NO longer an acceptable financial eligibility requirement
ONLY the computation of the NFCC will now be accepted
The values of the current assets and current liabilities shall be based on the data submitted by the bidder to the BIR through its EFPS

99. Submission of Tax Clearance

100. Submission of Tax Clearance
GPPB Resolution dated 30 July 2013
Amends Secs. 23.1(a) and 24.1(a) of the GPRA IRR, ITB Clause 12.1(a) of both the PBDs for Goods and Infrastructure Projects, and Eligibility Documents Clause 2.1 of the PBDs for Consulting Services
Tax clearance per Executive Order 398, Series of 2005, as finally reviewed and approved by the BIR.
Amends Sec of the GPRA IRR, ITB Clause 29.2 of the PBDs for Goods, ITB Clause 28.2 of PBDs for Infrastructure Projects, ITB Clause 27.2 of the PBDs for Consulting Services to delete the tax clearance requirement

101. Options for Bid Security

102. Options for Bid Security
GPPB Resolution dated 30 August 2013
Amends Secs. 27.2, 27.5 and 39.2 of the GPRA IRR and the corresponding Clauses in the PBDs
The procuring entity shall indicate in the Bidding Documents the acceptable forms of bid security that bidders may opt to use, which shall include the Bid Securing Declaration provided in Section 27.5 of this IRR and at least one (1) other form, the amount of which shall be equal to a percentage of the ABC in accordance with the following schedule:

103. Maraming Salamat
25 November 2014