Republic of the Philippines NATIONAL FOOD AUTHORITY REGION-II Tabuk, Kalinga April 19, 2013 THE HONORABLE MEMBERS

Government Procurement Policy Board Unit 2506 Raffles Corporate Center 7 Ortigas Jr. Road, ortigas Center Pasig City Gentlemen: I write in connection with Single Largest Contract requirement in the conduct of bidding for government projects. I understand that the rationale for this requirement is to give the procuring entity an opportunity to determine if the prospective bidder has the technical expertise to handle the project sought to be implemented. However, as a member of NFA RO2 BAC TWG - legal, I can not appreciate the requirement whenever we conduct bidding for Handling Services which pertains to the handling by laborers of NFA stocks like palay, rice, rice bran ( darak) , tarpauline and wooden pallets. As can be seen, the execution of the above stated activity requires only pure and simple muscular strength on the part of the laborer. Other government projects are invariably indivisible in the sense that there is a fixed duration for its execution and completion. Logically therefore, the Single Largest Contract side by side with Financial Capacity ( among other reasons) are being required to insure that the project being implemented will not be left hanging due to contractors lack of money or technical expertise. This is not the case for handling services which is a day to day project if ever it can be called such. It starts when office hours begin in the morning and ends at the close of office hours in the afternoon unless there is overtime. Nothing is ever left unfinished. In other words, the sum of all fears that R.A 9184 wants to avoid by drawing up the eligibility requirements of prospective bidders, are simply absent in the case of Handling Services. Before the procurement law, warehouse supervisors of the NFA transact directly with the head laborer or CABO of the laborers in the vicinity where the warehouse is located. Upon the implementation of the said law, the laborers were effectively barred from joining the bidding because they neither have the legal entity or the financial capacity required of prospective bidders. And herein lies the inequity. Unlike in other projects where the contractor has to put in money, expertise, machinery, etc. thus entitling him to a fair return on his investment. In the case of Handling Services there

is no real investment to speak of. The very investment are the laborers themselves who, in the case of the NFA, are already existing in the vicinity of every warehouse. And so, the entity - by bringing nothing at all except his business name gets to be paid at the expense of the laborers. Section 23.5.1.3, IRR of R.A 9184 states that the procuring entity is allowed to reduce the percentage of the Single Largest Contract vis--vis the ABC, if strictly requiring the 50% would result in a monopoly. But mere reduction is not enough because the laborers have no Single Largest Contract to speak of. In fact, a review of past and present Handling Services Contracts with NFA Regions 1-4 would reveal that there is only one contractor since the implementation of R.A 9184. In view of the foregoing circumstances, it would be more conscionable if the eligibility requirements on Single Largest Contract and Financial Capacity are removed in the bidding for Handling Services and allow Pakyaw Labor to participate in the said bidding along the concepts enunciated in Section 53.12, IRR of R.A 9184 pertaining to Community Participation in certain projects and Section 4.1, Revised Guidelines on Implementation of Infrastructure Projects by Administration, appendix I, IRR, R.A 9184 dealing with Pakyaw Contracting System. It should be noted that pursuant to the above stated Revised Guidelines, Pakyaw Contracting is allowed for infrastructure projects which require technical expertise. With more reason that this should be allowed for Handling Services of NFA stocks, the activity being strictly a local affair involving as it does the laborers in the community or vicinity where each NFA warehouse is located. A GPPB resolution to this effect would somehow level the playing field in favor of the working men who, for sheer lack of wherewithal, is miserably unable to advance his cause and for which he is oftentimes abused and exploited. If the proposal is given due course, then we could give meaning to the social justice provisions of our Constitution in favor of the less privileged. Very truly yours, RAYMOND U. TAFALLA Provincial Manager, NFA Kalinga Member, TWG- Legal NFA RO2 BAC