Public works secretary ‘Vince Dizon’ at a Palace media briefing. (Photo from the Philippine Information Agency)
At a press briefing in Malacañan Palace, public works secretary Vivencio ‘Vince’ Dizon announced the issuance of new budget guidelines for the Department of Public Works and Highways (DPWH) that starts with a new policy on proposed budgets for project consultants.
In an order issued early last week, Dizon outlined guidelines on the preparation, review and updating of Approved Budget for the Contract (ABC) for consulting services under locally funded and foreign-assisted projects of the agency.
Accordingly, under Department Order No. 184, the ABC will now strictly serve as the ceiling for bid prices in locally funded consulting projects. Any offer that goes beyond the ABC will be disqualified outright.
Also provided for in Dizon’s latest directive is for the ABC, referred to as the estimated project cost (EPC) in foreign-assisted projects, to follow the rules of donor or lending institutions with no increase beyond the approved loan or grant amount proceeding without clearance from oversight agencies such as the Department of Budget and Management (DBM) or the Department of Economy, Planning and Development (DEPDev).
“Compared to earlier rules, the new order imposes tighter controls by mandating documented market scoping, automatic disqualification of bids above the ceiling and higher-level approvals for any cost adjustments in foreign-assisted projects,” the secretary pointed out.
“Previous rules introduced during the time of former DPWH secretary and now Sen. Mark Villar had set a ‘management fee’ as the ABC for the project consultancy contract which took into consideration the actual cost of services to be rendered by the consultant. This called for the computation of a remuneration cost, overhead cost, a ‘social charge’ and the ‘management fee’ as well as a multiplier formula, not counting a ‘contingency’ fund,” he added.
In addition, the new budget guidelines also direct the DPWH Bureau of Design to validate all ABC packages and issue updated costing guidelines annually to reflect changes in law, funding rules or market conditions.