DOF uncovers P50m ‘white elephant’ IT project

August 30, 2017

The Department of Finance (DOF) has uncovered a P50 million “white elephant” left behind by the past administration that calls for a state-of-the-art “Disaster Recovery” site to back up the operations of the Bureau of Treasury (BTr) in Manila from a city in the Visayas, where major telecommunications providers have not yet installed high-speed broadband connectivity networks to support the system’s critical requirements.

In a report to Finance Secretary Carlos Dominguez III, Treasury officials said at a recent DOF executive committee (Execom) meeting they had learned of the project when the vendor informed them that it was ready to turn over the DR Site to the agency, a statement by the DOF said.

The project calls for the supply, delivery, installation and commissioning of various information and communications technology equipment, including the supply of labor, services and materials in support of the BTR’s operations in Manila from the remote location in the Visayas.

National Treasurer Rosalia de Leon said during that Execom meeting the site’s remote location “is not ideal for the Treasury’s critical systems” and telecommunications facilities such as high-speed fiber cables have not been set up by PLDT or Globe Telecom in the area, defeating the purpose of setting up the ICT facilities.

“I want you to get to the bottom of this and find out who was behind this project,” Dominguez said upon learning of the multi-million-peso structure that he described as a “white elephant.”

De Leon said no funds have been allocated for maintenance and operation of the DR under the 2017 budget.

“We also have no budget under the 2017 GAA (General Appropriations Act) to maintain and operate the DR as our current maintenance costs for the Ayuntamiento’s unified communications system is only about P28 million annually,” De Leon said.

The BTr’s main office is located at the Ayuntamiento de Manila building in Intramuros.

De Leon said they found out the Disaster Recovery site was too costly to operate and maintain because it needs to run at full capacity 24 hours a day, seven days a week, and requires security personnel to guard the property.

She said the BTr has no technical capability to run the Disaster Recovery data center.

Dominguez instructed De Leon to find ways to put the project to good use and to hire a private service provider to ensure it runs efficiently.

The site consists of a structure that houses precision air-conditioning units, a cold aisle containment system, uninterruptible power supply, an FM200 fire suppression system, access raised floor, tempered glass enclosures, acoustic ceilings, wall claddings, generator sets, variable refrigerant flow indoor units, a CCTV system, door access system that includes scanners, and temperature, humidity and water leak detection systems.

De Leon said the vendor operates and maintains the equipment until it is fully turned over to the BTr.

The contract amount for the center is P49,804,900.

According to the BTr, 80 percent of the contract amount was disbursed to project supplier Multi-Fold Links Inc.

The project was started in August 16 last year, when De Leon was not yet the national treasurer and the Duterte administration was still less than two months in office. Its turnover or end date was originally set last February 12, but was moved to July 15. DMS