Republic of the Philippines

COMMISSION ON AUDIT

Komisyon ng Pagsusuri

COA flags DOH over messy distribution of pandemic-related purchases

MEDICAL supplies and equipment worth P166.21 million purchased by the Procurement Service of
the Department of Budget and Management (PS-DBM) in 2020 and 2021 using funds from the
Department of Health (DOH) ended up with offices and persons they were not intended for. Another
batch of procurements totaling P18.56 million disappeared or their whereabouts unknown even if the
property transfer reports (PTRs) showed there was proper delivery and acceptance.

Yet a separate finding by the audit team shows supplies arrived a little bit lighter that otherwise
indicated in the distribution lists (DLs).These were revealed in the 2021 audit report on the DOH
released by the Commission on Audit.The COA has recommended that the secretary of Health require
the head of the agency’s Supply Chain Management Service (SCMS) to submit proof that every single
one of the supplies and equipment purchased by the PS-DBM as part of the COVID-19 response of the
DOH.

Out of 163 letters sent, only 67 replies came back. From the responses, the audit team isolated 11 that
hinted at deficiencies on the distribution of items totaling P185.603 million. Records showed P166.21
million worth of supplies and medical equipment were intended for delivery to the Cagayan Valley CHD,
the Southern Isabela Medical Center (SIMC), and the Ninoy Aquino Stadium COVID Site at the Rizal
Memorial Sports Complex in Manila.

None of the three target recipeints received any of the items. “The confirmation replies pertaining to
three recipient-agencies disclosed that the items were delivered to offices/regions other than (the ones)
indicated in the DL,” the COA noted. Inquiry by members of the audit team led them to the discovery
that a third of the deliveries landed with the Office of Civil Defense.

More worrisome however was the final destination of the balance of items worth P108.61 million that
went to unidentified persons and offices. “Items totaling P54,180,412 were received instead by the OCD
while a total of P108,609,640 were received by individuals whose office/agencies could not be
identified,” auditors said. Some 150,000 pieces of surgical masks worth P3.42 million that was intended
for Northern Mindanao CHD turned up at the Caraga CHD.

Auditors were also stumped by what happened to P18.56 million worth of supplies earmarked for use by
the Northern Mindanao CHD, Dr. Jose Rizal Memorial Hospital in Dapitan City, Margosatubig Regional
Hospital in Zamboanga del Sur, the Department of the Interior and Local Government (DILG), the
Department of Education (DepEd), and the Maria Lourdes Maternity Hospital in Makati City.

“The confirmation replies pertaining to the six recipient-agencies showed that the COVID-19 items were
not received by them,” the COA said. On the other hand, while Metro Manila CHD and Caraga CHD
confirmed having received supplies based on the distribution list, the quantities showed discrepancies.
Auditors said there were shortages amounting to at least P835,402.

How and by whose hand the under-delivery happened was not determined but the audit team said it
should be taken as evidence of diversion from the intended recipients. “This condition denotes
possibility of unauthorized and undocumented changes in DLs, resulting in such discrepancies,” it
pointed out. The DOH said the OCD was asked to submit and explanation since the discrepancies were
“observed during deliveries in which the latter was in charge.”

It said the OCD gave assurances that deliveries of medical supplies, personal protective equipment, and
other related materials were successfully made. The COA however insisted that OCD’s response should
be backed by documents as proof of deliveries, particularly the batches that were received by peersons
whose offices and agencies could not be identified.