Non-Policy Opinions

2007-08-13

NPM 042-2007

Requesting Entity: Philippine Orthopedic Center

Issues Concern: Lowest Calculated Bid vis-a-vis PADPAO Rate

 

Details

Whether award of contract may be made to the lowest calculated bidder whose offer is below the prescribed PADPAO rate or to the bidder with the highest offer whose bid is responsive to the PADPAO rate.

[A]ll PSA participating in the bidding for government contracts may offer different bid prices, even though it is below the PADPAO rate, without being charged of cut-throat competition or violating the provisions of the IRR of R.A. 5487, provided that they do not go below the standard salaries and benefits for the guards and the mandated taxes in the minimum cost distribution formula.

The BAC of procuring entities will then conduct a detailed evaluation of bids of those bidders that comply with the requirements of Section 25.3 of the IRR-A of R.A. 9184. The total calculated bid prices, as evaluated and corrected for computational errors, discounts and other modifications, will then be ranked in ascending order to determine the bidder with the Lowest Calculated Bid. (Section 32.4.4 of the IRR-A of R.A. 9484)

From the foregoing, it can be gleaned upon that procuring entities may award the contract to bidders with the Lowest Calculated and Responsive Bid even though it is below the PADPAO rate without being charged of cut-throat competition, provided that they do not go below the standard salaries and benefits for the guards and the mandated taxes in the minimum cost distribution formula.