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Philippine Government Procurement Law in Construction Management (of government projects)
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GPRA in Construction ManagementRepublic Act No. 9184
Government Procurement Reform Act
and its
Implementing Rules and Regulations
Outline of the Presentation
Background on GPRA GPRA in Construction Management Annex “E” Contract Implementation For Infrastructure
Projects Blacklisting Guidelines Question and Answer Portion
Government Procurement Reform Act (RA 9184)
Simplification of pre-qualification and the strengthening of post-qualification
Use of the Lowest Calculated and Responsive Bid for goods, supplies, materials and related services; and Highest Rated and Responsive Bid for consulting services
Use of the Approved Budget for the Contract (ABC) as ceiling for the bid price
Use of transparent, objective and non-discretionary criteria Increased transparency in the procurement process Professionalization of procurement officials Inclusion of Penal and Civil Liabilities
Government Procurement Reform Act (RA 9184)
Governing Principles of ProcurementTransparency
Equal Opportunity (through standardization)
Streamlined Process
Accountability
Public Monitoring
Government Procurement Reform Act (RA 9184)
General Rule: Competitive Bidding Method of procurement Open to participation by any interested party Consists of the following processes: advertisement, pre-
bid conference, eligibility screening of prospective bidders, receipt and opening of bids, evaluation of bids, post-qualification, and award of contract,
Specific requirements and mechanics of which shall be defined in the IRR to be promulgated under this Act
Government Procurement Reform Act (RA 9184)
General Process of Competitive Bidding: Advertisement Pre-bid conference Eligibility screening of prospective bidders Receipt and opening of bids Evaluation of bids Post-qualification Award of contract
Assumed the Process has been above-board
Government Procurement Reform Act (RA 9184)
Contract Implementation for Infrastructure Projects Annex “E” of IRR, RA 1984
Government Procurement Reform Act (RA 9184)
Variation Orders covers any increase/decrease in quantities, including the
introduction of new work items that are not included in the original contract or reclassification of work items that are either due to change of plans
change of plans, design or alignment to suit actual field conditions resulting in disparity between the preconstruction plans used for purposes of bidding and the "as staked plans“
construction drawings prepared after a joint survey by the contractor and the Government after award of the contract
Government Procurement Reform Act (RA 9184)
Variation Orders allowed, provided: cumulative amount of the positive or additive Variation
Order does not exceed ten percent (10%) of the original contract price
The addition/deletion of works under Variation Orders should be within the general scope of the project as bid and awarded.
The scope of works shall not be reduced so as to accommodate a positive Variation Order.
Government Procurement Reform Act (RA 9184)
Kinds of Variation Orders Change Order
Covers any increase/decrease in the quantities of original work items in the contract
Extra Work Order Introduction of new work necessary for the completion,
improvement or protection of the project which was not included as items of work in the original contract
where there are subsurface or latent physical conditions at the site differing materially from those indicated in the contract, or
where there are duly unknown physical conditions at the site of an unusual nature differing materially from those ordinarily encountered and generally recognized as inherent in the work or character provided for in the contract.
Government Procurement Reform Act (RA 9184)
Positive Variation Order Beyond 10% of Original General Rule: Subject of to another contract to be bid if
the works are separable from the original contract Exceptional cases
Urgently necessary to complete the original scope of work
Beyond 10% but not over 20% Subject to GPPB guidelines Sanctions on the designer, consultant or official who
failed to consider the Variation Order going beyond 10%
Government Procurement Reform Act (RA 9184)
Procedure for claiming a Variation Order Written Communication by contractor
Within 7 calendar days after commencement of work Within 28 calendar days Full and detailed particulars of the extra cost For purposes of investigation Failure to provide notice a waiver of any claim
Government Procurement Reform Act (RA 9184)
Procedure for claiming a Variation Order Preparation of Variation Order by Representative
Contractor’s Notice Plans Computations as to quantities
Indicate specific stations where works are needed Date of Inspection/investigations with logbook Detailed estimate of unit cost Justifications
Submission to the Head of the Procuring Entity
Government Procurement Reform Act (RA 9184)
Head refers to technical staff On the spot investigation by technical staff
To verify the work to be done Verification Report Review of quantities and prices Recommendation of Approval Approval of Head
Time frame for processing: not to exceed 30 calendar days
Government Procurement Reform Act (RA 9184)
Costing For change orders: exactly the same or similar to original
contract For extra work orders: based on
Direct unit costs used in the original contract All new components of new work items shall be fixed
prices, provided: Acceptable to both parties Based on contractor’s estimate as validated by the
procuring entity via document canvass
Request for payment: detailed accounting and amount
Government Procurement Reform Act (RA 9184)
Conditions to start work order and receive payments APPROVAL of the Head of Procuring Entity, except
Emergency Time is of the essence But cumulative increase must not exceed 5% And documented for approval
Cumulative amount exceeds 5% Needs prior approval before commencement
Government Procurement Reform Act (RA 9184)
Advance payment Written Request by contractor Not exceeding 15% of total contract price Lump sum or 2 installments According to schedule specified in ITB and other tender
documents Irrevocable standby L/C, bank guarantee or surety bond 15% Deduction from periodic progress payment Proportionate decrease in L/C or guarantee instrument
during progress of service
Government Procurement Reform Act (RA 9184)
Progress payment Monthly Statement of Work Accomplished (SWA) or
Progress billing and request for progress payment show the amounts which the contractor considers itself
to be entitled to up to the end of the month, to cover (a) the cumulative value of the works it executed to
date, based on the items in the Bill of Quantities, and
(b) adjustments made for approved variation orders executed
Check and certify by representative or project engineer
Government Procurement Reform Act (RA 9184)
Progress payment Deductions certified gross amounts of billing:
Cumulative value of the work previously certified and paid for.
Portion of the advance payment to be recouped for the month.
Retention money in accordance with the condition of contract.
Amount to cover third party liabilities. Amount to cover uncorrected discovered defects in the
works.
Government Procurement Reform Act (RA 9184)
Retention Money 10% of Progress Payments
For first 50% of value of works: 10% of total amount due
For last 50%: no additional retention if the work is satisfactorily done and on schedule
Due for release upon final acceptance of the works Could be substituted provided satisfactory and on time
Government Procurement Reform Act (RA 9184)
Contract Completion 95% completion Inspectorate team
Inspection Punch-listing
Remaining works Deficiencies Time for full completion of project
Preparation for Final Turn Over
Government Procurement Reform Act (RA 9184)
Liquidated Damages If delay exceeds a time duration equal to 10% of contract
time plus any extensions PE may rescind the contract Forfeit the security Takeover the project or award to another through negotiated contract
If delay exceeds 10% Automatic takeover or award to another Automatic forfeiture of security
Government Procurement Reform Act (RA 9184)
Suspension of Work by Procuring Entity Force Majeure Failure of contractor to correct unsafe work conditions or
conditions unsafe to public Failure of contractor to carry out valid orders Adjustment of plans to suit field conditions as necessary
during construction
Government Procurement Reform Act (RA 9184)
Suspension of Work by Contractor Right of way problems Failure to issue requisite construction plans Peace and order conditions
Certified in writing by PNP Confirmed in writing by DILG
Failure to deliver government-furnished materials and equipment
45-day delay in payment for progress billings
Government Procurement Reform Act (RA 9184)
Extension of Contract Time Additional Work Other special circumstance PE determines amount of extension Notice of circumstance justifying extension
Prior to expiration of contract Within 30 days after such work has been commenced or
after the circumstance leading to such claim has arisen Failure to provide notice: waiver of claim Subject to investigation
Government Procurement Reform Act (RA 9184)
Extension of Contract Time No extensions allowed for:
Ordinary unfavorable weather conditions Inexcusable failure or negligence of contractor to
provide required equipment, supplies and materials Reasons given to support request was already
considered in the original contract Only when affected activities fall within the critical path of
the PERT/CPM network
Government Procurement Reform Act (RA 9184)
Extension of Contract Time Rainy/unworkable days
Based on actual conditions of the site In excess of the rainy/unworkable days allowance
determined in the original contract major calamities such as exceptionally destructive
typhoons, floods and earthquakes, and epidemics non-delivery on time of materials, working drawings, or
written information to be furnished by the procuring entity
Government Procurement Reform Act (RA 9184)
Extension of Contract Time Rainy/unworkable days
non-acquisition of permit to enter private properties within the right-of-way, resulting in complete paralyzation of construction activities
other meritorious causes as determined by the Government's authorized Engineer and approved by the procuring entity
Government Procurement Reform Act (RA 9184)
Extension of Contract Time Public Conditions
Shortage of Construction Materials General Labor Strikes Peace and Order Problems
These may be considered provided: Publicly-felt certified by appropriate government agencies such as
DTI, DOLE, DILG, and DND, among others Attached bondsmen’s consent to request for extension
Government Procurement Reform Act (RA 9184)
Blacklisting Failure of contractor, due solely to his fault or negligence to
mobilize and start work within the specified period in the NTP Failure by the contractor to fully and faithfully comply with
its contractual obligations without valid cause, or failure by the contractor to comply with any written lawful
instruction of the procuring entity or its representative(s) pursuant to the implementation of the contract
Assignment and subcontracting of the contract or any part thereof or substitution of key personnel named in the proposal without prior written approval by the procuring entity
Government Procurement Reform Act (RA 9184)
Blacklisting poor performance by the contractor or unsatisfactory quality
and/or progress of work arising from his fault or negligence as reflected in the Constructor's Performance Evaluation System (“CPES”) rating sheet In the absence of a CPES Rating Sheet, poor performance
is: Negative slippage of 15% and above within the critical path of
the project due entirely to the fault or negligence of the contractor
Quality of materials and workmanship not complying with the approved specifications arising from the contractor's fault or negligence
Government Procurement Reform Act (RA 9184)
Blacklisting Willful or deliberate abandonment or non-performance of
the project or contract by the contractor resulting to substantial breach thereof without lawful and/or just cause
Consequence: Suspension Forfeiture of Performance Security
Government Procurement Reform Act (RA 9184)
Blacklisting Lawful instructions, include but are not limited to:
Employment of competent technical personnel, competent engineers and/or work supervisors
Provision of warning signs and barricades in accordance with approved plans and specifications and contract provisions
Stockpiling in proper places of all materials and removal from the project site of waste and excess materials, including broken pavement and excavated debris in accordance with approved plans and specifications and contract provisions
Government Procurement Reform Act (RA 9184)
Blacklisting Lawful instructions, include but are not limited to:
Deployment of committed equipment, facilities, support staff and manpower
Renewal of the effectivity dates of the performance security after its expiration during the course of contract implementation
Government Procurement Reform Act (RA 9184)
Blacklisting Procedure Termination of Contract due to default Immediate Issuance of Blacklisting Order Forfeiture of performance secuty Notification of the GPPB
Government Procurement Reform Act (RA 9184)
Question and Answer Portion
GPRA in Construction ManagementThank you very much!