EXECUTIVE ORDER NO. 359
EXECUTIVE ORDER NO. 359 -
REITERATING THE POLICY AND PRESCRIBING GUIDELINES AND PROCEDURES IN THE
IMPLEMENTATION OF THE PROVISIONS OF EXECUTIVE ORDER NO. 285,
“ABOLISHING THE GENERAL SERVICES ADMINISTRATION AND TRANSFERRING ITS
FUNCTIONS TO APPROPRIATE GOVERNMENT AGENCIES” ON THE OPERATION OF A
PROCUREMENT SYSTEM FOR COMMON-USE OFFICE SUPPLIES, MATERIALS AND
EQUIPMENT
WHEREAS,
the cost of government operations can be substantially reduced through
greater efficiency in the procurement of supplies, materials and
equipment;
WHEREAS, innovations in procurement have been successfully tested by
the Department of Budget and Management (DBM), Department of Finance
(DOF) and the Commission on Audit (COA) through the Pilot Procurement
Project and subsequently the Procurement Service;
WHEREAS, the said policies, procedures and innovations should be
institutionalized in line with the provisions of Letter of Instructions
No. 755 and Executive Order No. 285 mandating the operation of a
government-wide procurement system and price monitoring of common-use
supplies, materials, and equipment;
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, by
virtue of the powers vested in me by law, do hereby order:
Section 1. Reiteration of Policy. — The National
Government hereby reiterates the policy that procurement of government
supplies, materials and equipment shall be done in the most economical
and efficient manner by purchasing directly from reliable sources in
economic lot sizes, by observing optimum specifications and by making
prompt payment.
Sec. 2. Organization. — a. Pursuant to the
principle enunciated under Sec. 51, General Provisions, Republic Act
No. 6688, a Procurement Policy Board is hereby established to consist
of the Secretary of Budget and Management (DBM) as Chairman and, as
Members, the Secretaries of Finance (DOF), Trade and Industry (DTI),
Health (DOH), National Defense (DND), Public Works and Highways (DPWH),
Education, Culture and Sports (DECS) and a representative from the
Philippine Institute of Certified Public Accountants (PICPA).
The Board shall promulgate rules and regulations to carry out the
policy statement and intent of this Executive Order, which shall serve
as the basis for the procurement operation of the Procurement Service
(PS) of the Department of Budget and Management (DBM) and other
government agencies. In the formulation of said rules and regulations,
the Procurement Policy Board may, in its discretion, consult the
Chairman, Commission on Audit on matters falling under the functional
jurisdiction of the Commission.
The Board shall conduct periodic evaluation of the effectiveness of the
centralized procurement system as carried out by the Procurement
Service in terms of economy and efficiency measured against the
following criteria:
(1)
comparable prices in the open market;
(2) compliance
with established standards and quality as formulated by the Bureau of
Product Standards of the Department of Trade and Industry; and
(3) meeting
delivery time standards to client agencies.
For the above purpose, the Board may commission the undertaking of an
independent survey to accomplish this task.
Upon effectivity of this Executive Order, the hold-over status of all
the Members of the Procurement Council who are rendering services on
hold-over capacity in the Procurement Service shall automatically
terminate and cease.
b. In line with the mandate of Executive Order No.
285, the Procurement Service (PS) of the Department of Budget and
Management (DBM) and its Inter-Agency Bids and Awards Committee created
under Letter of Instructions No. 755 shall be maintained as the regular
organizational units to implement and operate a central procurement
system. Accordingly, DBM shall in accordance with Executive Order No.
86, establish Regional Depots as part of the regular organization
structure of the Procurement Service from which government agencies may
locally purchase their common use supplies, materials and equipment
requirements.
Sec. 3. Coverage. — All national government
agencies, including State Universities and Colleges and government
owned or controlled corporations and their subsidiaries, that require
common-use supplies, materials and equipment are covered by the
Executive Order. The central procurement system may be availed of by
local government units, on a voluntary basis.
Agencies are, however, allowed to procure directly for emergency needs
whenever there is a significant delay in the delivery of urgently
needed supplies by the Procurement Service, subject to existing
accounting and auditing rules and regulations.
Sec. 4. Operating Procedures. — The operating
procedures of the procurement system shall be prescribed by the
Procurement Service (PS). Said operating procedures shall remain in
force unless subsequently modified in consultation with the Systems and
Procedure Bureau (SPB) of DBM, subject to the approval of the
Procurement Policy Board.
The operating procedures shall cover, among others, the following:
a.
Preparation and submission of the annual agency procurement programs
for brand-new supplies, materials and equipment which are covered by
the procurement system.
b. The
appropriations for the Annual Procurement Programs of Agencies shall be
identified in their annual Work and Financial Plan. Said Work and
Financial Plan shall serve as the basis of the Department of Budget and
Management in the release of the Agency’s quarterly allotments and
monthly funding warrants.
The agencies shall remit in
advance to the Procurement Service the funds needed to service their
requirements for supplies, materials and equipment as reflected in said
Work and Financial Plan.
c. Adoption of
simplified bidding procedures as authorized under Item 12 of Letter of
Instructions No. 755 by a Procurement Service Bids and Awards Committee
whose composition shall be determined by the Procurement Policy Board.
d. In the
evaluation of supplies, materials and equipment, the applicable
standards as to specifications and test methods as formulated by the
Bureau of Product Standards shall be strictly followed; where otherwise
not available, the appropriate international and/or trade standards,
whichever is more beneficial to the government, shall apply. Evaluation
of items which are highly technical in nature shall in all cases be
attended by the technical experts of the end-user agency and
representatives of professional associations under whose field of
expertise the items may be covered.
e. The
charging of service fees by the Procurement Service to cover its
personnel services and other operational expenses as may be authorized
by the Procurement Policy Board pursuant to Sec. 33 of Republic Act
No. 6688 and Sec. 52 of Presidential Decree No. 1177, but not to
exceed five (5%) percent of the value of supplies, materials and
equipment procured and supplied to the agency concerned.
Sec. 5. Funding. — The initial funding for the
operation and initial stocking of the regional depots shall be charged
against available appropriations of the Department of Budget and
Management. This shall include the amount of three million pesos
(P3,000,000.00) for each regional depot which shall be treated,
recorded, deposited and used consistent with and in the same manner as
the PS Operating Funds established under Letter of Instructions No. 755.
In case of deficiency of available appropriations, such deficiency
shall be covered by savings from any appropriate lump-sum funds as may
be determined by the Department of Budget and Management.
Sec. 6. Repealing Clause. — The provisions of
Procurement Council Circular No. 1; Joint Circular 77-2 as amended by
Procurement Circular No. 3 and 3a; Joint Circular No. 3-B and Joint
Department of Budget and Management, Department of Trade and Industry,
and Commission on Audit (DBM-DTI, COA) Memorandum Circular, dated
October 1, 1987 prescribing the Implementing Guidelines on Government
Procurement of Bureau of Product Standards-Certified Products that are
inconsistent herewith are hereby revoked or modified accordingly.
Sec. 7. Effectivity. — This Executive Order shall
take effect immediately.
Done in the City of Manila,
this 2nd day of June, in the year of Our Lord, nineteen hundred and
eighty-nine.
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Since 19.07.98.