NHA was putting vehicle rental costs into construction project budgets as a way to get vehicles without getting the required approval from the Department of Budget and Management (DBM) and without following the proper government procurement process. This is a way to bypass the rules for acquiring government vehicles, which is not allowed.

Why It Matters

Recommended Actions

• Provide the required DBM approval on the rental of MVs included in the pay items of NHA projects
• Otherwise, refund the amount of the service vehicle rental included in the POWs of NHA projects that were not subsequently donated to NHA, or were not supported with proof of actual use during project implementation
• Provide inventory report, acknowledgment receipt, and deeds of transfer and acceptance of the MVs and office supplies/equipment (excluding expendable items) included in the POWs of NHA projects, and Henceforth, for all rentals of MVs, secure the necessary approval from the DBM as required under DBM BC No. 2022-1 and ensure that the procurement thereof complies with the Procurement Law.

Original Audit Finding Excerpt

"The inclusion of service vehicle rental as pay item in the Programs of Work (POW) of infrastructure projects enables NHA to acquire vehicles without the necessary authority under DBM BC No. 2022-1, and without undergoing procurement as required under RA No. 9184, consequently undermining the prudent and judicious acquisition, utilization, and rental of government motor vehicles (MVs)."

Source Document