SC affirms disallowance of SBMA's P2M uniforms but no longer requires refund from execs

SC affirms disallowance of SBMA’s P2M uniforms but no longer requires refund from execs

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The Supreme Court (SC) has affirmed the Commission on Audit’s (COA) disallowance of the Subic Bay Metropolitan Authority’s (SBMA) P2.42-million expenses for the irregular procurement of uniforms—but it no longer required officials to refund the amount.

In a recent en banc decision, the SC found the liable officials of the SBMA to be in good faith, especially as they were still able to obtain the best prices and quality even without strictly following the Government Procurement Reform Act.

The SBMA officials argued that the department heads meticulously followed the procedure provided by the Uniform Committee, that they were still able to obtain the most advantageous prices, and that public bidding compromised the quality of the uniforms in the past.

The SC agreed, noting that the COA did not deny these contentions.

Although the SBMA officials did not strictly follow the letter of the implementing rules and regulations (IRR) of the procurement law, the SC said they “attempted in good faith to comply with the spirit and policy” of the said law.

The SC added that the SBMA officials lacked knowledge of the illegality of pooling uniform allowances in a trust fund for the purpose of procuring uniforms.

This issue was actually novel, and only declared to be illegal by the SC in this case.

“Petitioners cannot be faulted for improperly understanding the intricate application of the law in their devised procurement scheme,” read the decision penned by Associate Justice Alexander Gesmundo.

“It is unfair to penalize public officials based on overly stretched and strained interpretations of rules which were not that readily capable of being understood at the time such functionaries acted in good faith,” it added.

The decision even warned that punishing public officials for creative interpretation of ambiguities in the law would be “counterproductive.”

“It could result in paralysis, or lack of innovative ideas getting tried. In addition, it could dissuade others from joining the government. When government service becomes unattractive, it could only have adverse consequences for society,” the decision read. #

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