Overview
This Senate Blue Ribbon Committee hearing investigated alleged corruption and irregularities in the allocation, insertion, and implementation of flood control and infrastructure budgets in the Philippines, focusing on the 2025 General Appropriations Act. Testimonies from legislators, local government officials, contractors, and resource persons highlighted issues of budget manipulation, non-transparent insertions, substandard and ghost projects, and widespread demands for kickbacks among public officials.
Attendance and Acknowledgments
- Comprehensive roll call of present senators, government officials, agency representatives, DPWH regional and district engineers, contractors, insurance executives, and resource persons.
- Noted absences and received official excuses or regret letters from several key invitees (e.g., Mayor Magalong, DPWH Secretary Dizon, former Undersecretary Pipo).
Budget Insertion Process in Congress
- Congressman Toby Tianko detailed a two-track insertion system involving a small committee and BICAM, where only a few members controlled major budget amendments.
- Lack of documentation and transparency around small committee reports and BICAM insertions.
- Significant budget increases (up to 17.5B in certain districts, especially Mindoro) not requested by local congressmen but inserted by key committee members.
- Practice of “parking” and “sagasa” explained: parking involves district congressman’s consent; sagasa is imposed without their consent.
Findings on Flood Control Funding
- Disproportionate funds allocated to select districts (e.g., Mindoro received 30B despite a 12B master plan).
- Unusually high allocations to party-list groups.
- Lack of project justification and documentation for many insertions.
- DPWH and local contractor design and implementation failures leading to disastrous and overpriced flood infrastructure.
Testimony of Governor Dolor
- Expressed gratitude for funding, but frustration and disappointment due to implementation failures, substandard and ghost projects, and lack of consultation.
- Detailed overpricing (up to 1M/linear meter), substandard construction, and unimplemented or misallocated projects in Mindoro.
- Alleged standardized kickbacks (up to 42% of project value) requested by officials.
Allegations by Contractors (Diskaya Testimony)
- Contractors coerced into regular kickback payments (10–25% of project value) to DPWH officials and congressional staff/bagmen to ensure project implementation.
- Named specific public officials, engineers, and intermediaries involved in demand for illegal commissions.
- Provided details of illicit transactions, threats, and systemic corruption at multiple levels.
Issues Raised on Procurement and Regulation
- Early procurement (“bid short of award”) rules clarified; only allowed for NEP-listed projects under RA 12009.
- Inserted projects outside NEP not eligible for pre-procurement, raising questions on legality and process integrity.
Committee Discussion and Debate
- Senators expressed concern over monopolized budget processes, rushed approvals, lack of transparency, and the failure of checks and balances in Congress.
- Calls for stricter adherence to legislative and regulatory procedures, and a review of the budget approval process.
Decisions
- Excuse Mayor Magalong due to anticipation of House testimony.
- Require Usec Cathy Cabral to submit documents on all projects bid “short of award”.
- Committee to require submission of all relevant bidding, district, and proponent records from resource persons.
Action Items
- TBD – Usec Cathy Cabral: Submit complete documentation of projects bid “short of award” to the committee.
- TBD – Blue Ribbon Staff: Secure electronic records from Congressman Tianko and distribute to committee members.
- TBD – Contractors: Provide sworn affidavits and supporting documentary evidence of transactions and kickbacks.
- TBD – Blue Ribbon Committee: Investigate allegations and pursue possible reforms on budget process and DPWH project implementation.
Questions / Follow-Ups
- Clarify which districts received insertions, who proposed them, and whether local officials consented.
- Confirm how much of the allocated budget resulted in completed, quality infrastructure.
- Investigate further the specific individuals and mechanisms facilitating “parking”, “sagasa”, and illegal commissions.