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Management Services

Report No. 2002-02


Government-Wide Audit

Solid Waste Management


OVERALL REPORT

Republic of the Philippines


Commission on Audit
MANAGEMENT SERVICES
Commonwealth Avenue, Quezon City, Philippines
Telephone Nos.: 931-9235 , 931-74-55

June 20, 2003

The Honorable Secretary


Department of Interior and Local Government
Francisco Gold Condominium
EDSA, Quezon City
Sir:
We are pleased to transmit the results of the government-wide
performance audit of Solid Waste Management (SWM) focusing on waste
collection system of ten selected Local Government Units (LGUs) within Metro
Manila. The audit was conducted in compliance with COA Assignment Order
No. 2002-21 dated July 18, 2002 by a team from this Office from July 16 to
October 30, 2002. The results of the audit were discussed with the concerned
officials and employees of the 10 LGUs audited in separate exit conferences
conducted between October 21 to November 15, 2002. Their comments were
incorporated in the report where appropriate.
The audit covered the implementation of SWM operations from January
2001 to June 2002. The LGUs included in the audit were the Cities of Manila,
Quezon, Makati, Pasay, Caloocan, Pasig, Mandaluyong, Marikina, Valenzuela
and Malabon.
The audit focused on the selection of contractors by 7 LGUs
implementing SWM by contract including the process of estimating solid
wastes generation and monitoring of contractors performance. The operations
of the three (3) LGUs undertaking SWM operations by administration were also
included in the audit for comparison purposes. The performance of the LGUs
audited were assessed using the following criteria:
1.
2.
3.
4.
5.

Established policies and procedures


Appropriate resources
Sound management and monitoring mechanisms
Effective quality assurance processes
Cost measures

To ensure that the concerns arising from the deficiencies noted in the
audit shall be properly addressed, it is suggested that the Department consider
issuing Department Order prescribing the following:
1. The minimum terms and conditions for contracting solid wastes
collection to protect the interest of the government and ensure the
effective performance of contractors. This may include among
others, the following:
a.

b.

c.

2.

Standard factor for estimating solid waste generation by


source as basis for fixing contract cost which should
include conversion factors;
Technical (experienced workers and availability of
adequate equipment for solid wastes collection, etc.) and
financial requirements (minimum capitalization
and
working capital) for contracting collection and disposal of
solid wastes;
Penalty for any deviation/violation of contract provisions
that will affect the performance of contractors such as
fielding lesser number of garbage trucks than what is
contracted for or servicing lesser area than what is
stipulated in the contract.

Setting a standard to assess solid wastes collection efficiency after


the standard estimates for garbage generation is established ( Say
90% of the estimated volume of wastes for collection).

We will appreciate your assistance in the proper implementation of


recommendations that falls within your supervision.
We acknowledge the cooperation and assistance extended to the audit
team by the officials and staff of the ten LGUs audited.

Very truly yours,


By Authority of the Chairman:

(Sgd.) ILUMINADA M.V. FABROA


Director IV
Management Services

Contents
Part I

Page

Executive Summary
Background
2
Audit Objective
3
Audi Scope and Methodology
3
Audit Conclusion
4
Managements Reaction to Audit Observations

Part II

Solid Waste Management Framework

Background
7
National Solid Waste Management Commission 8
Joint Congressional Oversight Committee
8
Metro Manila Development Authority
9
Local Government Units 10
Coordination of Waste Management Activities
11
Involvement of Industry
14
Costs Associated with Waste Management
14
Part III

Audit Observations and Recommendations

16

Chapter 1

17

Established Policies and Procedures


Introduction
18
Observation
18
Managements Response and
Teams Rejoinder
26
Recommendation
31

Chapter 2

Appropriate Resources
Introduction
34
Observation
34
Managements Response and
Teams Rejoinder 37
Recommendation
39

33

Chapter 3

Sound Management and Monitoring


Mechanisms
Introduction
Observation

40

41
41

Managements Response and


Teams Rejoinder
48
Recommendations 54
Chapter 4

Effective Quality Assurance Processes

56

Introduction 57
Observation
57
Managements Response and
Teams Rejoinder 60
Recommendation
63
Chapter 5

Cost Measures

64

Introduction
65
Observation
67, 73
Managements Response and
Teams Rejoinder 74
Recommendation
80
Part IV

Annexes

83

PART I

Executive Summary

EXECUTIVE SUMMARY

BACKGROUND
1.1.1.

The escalating generation of solid waste brought about by fast


economic growth and rapid urbanization is the responsibility of all
sectors of the society. The problem of todays solid waste, if improperly
handled, carries implications not only for our environment but also for
the health and well being of future generations. When waste ends up
where it is not supposed to be, it becomes useless, causes pollution, and
poses health risks. When it is used and put in the right place, it becomes
a valuable resource.

1.1.2.

Section 17 of the Local Government Code of 1991 provides that Local


Government Units (LGUs) shall exercise such powers and discharge
such functions and responsibilities as are necessary, appropriate, or
incidental to efficiently and effectively provide basic services and
facilities such as solid waste disposal system or environmental
management system and services or facilities related to general
hygiene.

1.1.3.

Pursuant to the above mandate, LGUs initiated the institutionalization


of their area-wide waste management system which includes the
establishment of garbage transfer stations, programmed garbage
collection, maintenance of cleanliness on streets and sidewalks,
consistent monitoring of garbage and waste disposal, instilling public
awareness on right and appropriate waste/garbage disposal and
launching such other projects and programs relative to environmental
management, hygiene and sanitation.

1.1.4.

The Solid Waste Management (SWM) system has six elements: waste
generation, transfer, recovery/processing, storage, collection and
disposal. The audit did not endeavor to cover all stages but focused on
solid waste collection which is critical among the six mentioned
elements.

1.1.5.

Waste must be collected in every home, apartment, building,


commercial and industrial facilities as well as streets and parks. The
uncollected garbage piling up in the streets in commercial and
residential areas within Metro Manila has been the subject of media
criticism. As most LGUs implement SWM thru contracting-out
collection and disposal of solid waste, the audit also covered

EXECUTIVE SUMMARY

assessment of the monitoring system of the LGUs on the performance


of contractors.
1.1.6.

The Government, in its efforts to introduce improvements in the present


system of SWM, enacted Republic Act No. 9003 (Ecological Solid
Waste Management Act of 2000). It provides for an ecological SWM
program, creation of the necessary institutional mechanisms and
incentives and declares certain acts prohibited with corresponding
penalties.

AUDIT OBJECTIVE
1.1.7

The audit objective was to determine whether the solid waste


collection function of selected LGUs in Metropolitan Manila was
undertaken in the most efficient and economical manner giving
consideration to:

Selection of Contractors including the process of estimating solid


waste generation
Monitoring of Contractors Performance

AUDIT SCOPE AND METHODOLOGY


1.1.8

The audit focused on the evaluation of selected contracts for the year
2001 and 2002 of the following LGUs:

Makati City
Mandaluyong City
Pasig City
Quezon City

Pasay City
Caloocan City
Manila City

The team also evaluated the operations of the following LGUs


implementing SWM by administration for comparison purposes:

Marikina City
Malabon City
Valenzuela City

EXECUTIVE SUMMARY

The performance of the LGUs were evaluated using the following


criteria:

Established Policies and Procedures


Appropriate Resources
Sound Management and Monitoring Mechanisms
Effective Quality Assurance Processes
Cost Measures

The team performed the following procedures during the audit:

Reviewed existing policies and procedures of the LGUs in the


selection of contractors and implementation of SWM by
administration;
Interviewed personnel assigned in SWM;
Reviewed selected contracts thru evaluation of selection process;
Conducted ocular inspection of facilities used in solid waste
collection function;
Reviewed records maintained in monitoring the performance of
contractors;
Evaluated the system of monitoring contractors performance;
Assessed the effectiveness of the risk management process in place;
Reviewed and evaluated the roles and responsibilities of NSWMCEMB and MMDA in SWM;
Administered survey questionnaires to selected barangay officials and
residents.

The audit was conducted from July 16 to October 31, 2002 pursuant to
COA Assignment Order No. 2002-021 dated July 18, 2002.

AUDIT CONCLUSION
1.1.9

The audit concluded that generally, selected LGUs have not efficiently
and economically carried out their SWM function through the
satisfactory selection of contractors and monitoring their performance
in the collection, cleaning and disposal of solid wastes. This was due
to failure of the LGUs to establish adequate policies and procedures on
selection of contractors to ensure that the most qualified contractors
were selected. Moreover, the performance of selected contractors were
not properly monitored due to absence of established policies and

EXECUTIVE SUMMARY

procedures including performance indicators/standards to gauge the


efficiency of contractors performance. As a result, some contractors
were not able to comply with the requirements of the contracts and
their performance were not appropriately assessed leaving some solid
wastes uncollected.
1.1.10 The team also noted that the LGUs do not have established
methodology in estimating solid wastes generation from different
sources such as markets, rivers, street sweeping, schools and other
institutions. As a result, they tend to estimate solid waste generation
from household population only of which they were using factors
ranging from .500 to 1.27 kilograms per person daily. The factor
established under the Japan International Cooperation Agency (JICA)
study for this source is .552 kg for 2002. Relatively speaking, three
LGUs were using factors higher than the established factor for this
source while the factors used by three other LGUs were not disclosed
in any document provided to the team. Since the estimated daily solid
waste generation is the basis of the contract, the reasonableness of the
contract cost is doubtful. The efficiency of the collection system could
not also be assessed.
1.1.11 The less than satisfactory performance of LGUs on SWM operation
can also be attributed to their failure to establish SWM Board to
oversee and coordinate the implementation of SWM operation.
1.1.12 As SWM is a continuing activity of the LGUs and mishandling of this
function would have a great impact on the environment and health of
the citizens, the LGUs should seriously consider addressing these
concerns.

MANAGEMENTS REACTION TO AUDIT OBSERVATIONS


1.1.13 The results of the audit were discussed with the concerned officials
and employees of the 10 LGUs audited in separate exit conferences
conducted between October 21 to November 15, 2002. Their
comments were incorporated in the report where appropriate.

PART II

Solid Waste Management Framework

SOLID WASTE MANAGEMENT FRAMEWORK

BACKGROUND
2.1

Solid waste, according to internationally accepted definition, is nonliquid waste material arising from domestic trade, commercial,
industrial and mining activities. It also includes wastes arising from the
conduct of public services such as street sweeping, landscape
maintenance, and the clearing of debris brought about by typhoons.

2.2

SWM on the other hand, refers to an integrated approach of controlling


the generation, as well as managing the storage, collection, transfer and
transport, processing and disposal of solid wastes in a manner that is in
accord with the best principles of public health, economics,
engineering, conservation, aesthetics, and other environmental
considerations, which is responsive to public needs.

2.3

Changing practices brought about by rapid urbanization, increase in


population and intensifying economic activities contributed to the
problem of SWM such as:

frequent use of disposable items such as diapers, razors, pens and lately,
even disposable cameras;
increase in packaging and the use of non-refillable materials;
indifference of some stakeholders to the advantages of recycling;
patronizing products that are made from recyclable, rather than nonrecyclable sources;
presence of household toxic wastes in the garbage stream.

2.4

Under R.A. 9003, National Solid Waste Management Commission


(NSWMC) was created with the Secretary of the Department of
Environment and Natural Resources (DENR) as the chairman with 14
members from the government and 3 from the private sectors. The
NSWMC took over the functions of the defunct Presidential Task Force
on Waste Management. The DENR Environmental Management
Bureau (EMB) acts as the secretariat of the Commission. The NSWMC
oversees the implementation of SWM plans and prescribe policies to
achieve the objectives of the Act.

2.5

Under R.A. 7160, (Local Government Code of 1991), LGUs, i.e.,


Cities, Municipalities and Barangays, have the primary responsibility
over the collection of solid wastes. Disposal of solid wastes was the
function of MMDA. However, due to solid wastes crisis experienced in

SOLID WASTE MAGEMENT FRAMEWORK

the Metropolis in 2000 and 2001, this function was passed by the
MMDA to the LGUs. The MMDA now merely provides financial
assistance to the LGUs to assist them in the disposal function. Under
R.A. 7924 (Law creating MMDA), MMDA shall take the role of a
virtual coordinating body in SWM. Thus, it is considered as a regional
office for the 17 Cities and Municipalities within Metro Manila.

2.6

National Solid Waste Management Commission

2.6.1

The major functions in relation to SWM are to:

2.6.2

2.7
2.7.1

Prepare the National Solid Waste Management Framework;


Approve local SWM plans;
Review and monitor the implementation of local SWM plans;
Coordinate the operation of local SWM boards;
Assist provincial, city and municipal SWM boards in the preparation,
modification and implementation of waste management plans;
Adopt a program to provide technical and other capability building
assistance and support to LGUs in the development and implementation of
source reduction program.

The NSWMC shall report to Congress, not later than March 30 of every
year following the approval of R.A. 9003, the detailed account of its
accomplishment and progress on SWM during the year and the
necessary recommendations on the need for legislative action.

Joint Congressional Oversight Committee


Under Section 60 of R.A. 9003, a Joint Congressional Committee was
also created to monitor the implementation of the Act and oversee the
function of NSWMC.
It is composed of 5 Senators and 5
Representatives appointed by the Senate President and Speaker of the
House of Representatives, respectively. The Oversight Committee is
co-chaired by a Senator and a Representative designated by the Senate
President and the Speaker of the House of Representative, respectively.

SOLID WASTE MAGEMENT FRAMEWORK

2.7.2

In accordance with the Rules of Procedures adopted by the Oversight


Committee on August 28, 2002, it shall, in aid of legislation, perform
among others, the following functions:

Set the guidelines and over-all framework to monitor and ensure the
proper implementation of R.A. 9003;
Submit periodic reports to Congress;
Determine inherent weaknesses in the law and recommend necessary
remedial legislation;
Perform such other duties and functions as may be necessary to attain its
objectives pursuant to the provisions of R.A. 9003.

2.8

Metro Manila Development Authority

2.8.1

Under R.A. 7924, the primary responsibility of MMDA for SWM is to


provide LGUs the services of solid waste disposal and management
which include formulation and implementation of policies, standards,
programs and projects for proper and sanitary waste disposal.

2.8.2

In Metro Manila, the Provincial/Regional Solid Waste Management


Board shall be chaired by the chairperson of MMDA with the mayors
of its component Cities and Municipalities as members, as provided
under R.A. 9003.

2.8.3

The major functions/responsibilities of the Board are to:

Develop a provincial SWM plan from the submitted SWM plans of the
respective city and municipal SWM boards which shall be submitted to
the NSWMC for approval;
Provide the necessary logistical and operational support to its component
cities and municipalities in consonance with subsection (f) of Section 17
of R.A. 7160;
Convene joint meetings of the provincial, city and municipal SWM boards
at least every quarter for purposes of integrating, synchronizing,
monitoring and evaluating the development and implementation of its
provincial SWM plan;
Represent any of its component City or Municipality in coordinating its
resource and operational requirements with agencies of the national
government.

SOLID WASTE MAGEMENT FRAMEWORK

2.9

Local Government Units

2.9.1.

Under R.A. 7160, among the basic services and facilities that shall be
provided by the LGUs is solid waste collection.

2.9.2

Section 12 of R.A. 9003 requires each city or municipality to form a


City or Municipal Waste Management Board which shall be headed by
the City/Municipal mayor. Its major duties and responsibilities are to:

2.9.3

Develop the City or Municipal SWM Plan that shall ensure the long-term
management of solid waste, as well as integrate the various SWM plans
and strategies of the barangays in its area of jurisdiction. In the
development of the SWM Plan, it shall conduct consultations with various
sectors of the community;

Adopt measures to promote and ensure the viability and effective


implementation of SWM programs in its component barangays;

Oversee and monitor the implementation of the City or Municipal SWM


Plan through its various political subdivisions and in cooperation with the
private sector and the NGOs;

Coordinate the efforts of its component barangays in the implementation


of the city or municipal SWM Plan;

Review every two (2) years or as the need arises, the City or Municipal
SWM Plan for purposes of ensuring its sustainability, viability,
effectiveness and relevance to local and international developments in the
field of SWM.

The City or Municipal SWM Plan shall be composed among others of:

city or municipal profile


waste characterization
collection and transfer:
a)

segregation of different types of solid waste for re-use, recycling and


composting;
b) hauling and transfer of solid waste from source or collection points to
processing sites or final disposal sites;
c) issuance and enforcement of ordinances to effectively implement a
collection system in the barangay; and

10

SOLID WASTE MAGEMENT FRAMEWORK

d) provision of properly trained officers and workers to handle solid


waste disposal.

2.10

processing
source reduction
recycling
composting
solid waste facility capacity and final disposal
education and public information on source reduction, recycling and
composting programs
special waste
resource requirements and funding
incentive programs

Coordination of waste management activities

2.10.1 Since various aspects of waste management are spread over a number
of agencies, it is important that the duties and responsibilities of each
agency are clear and that their activities are well-coordinated. This is
necessary to ensure that all agencies involved in SWM are working
toward common goals. Since R.A. 9003 took effect in December 2001,
most of the LGUs have incorporated their SWM plan either in their
Medium-Term Development Plan (MTDP) or Investment Plan for
2002.

2.11 Activities undertaken under R.A. 9003:


2.11.1 The P20M appropriated from Organizational Adjustment Fund under
RA 9003 for the initial operating expenses of the NSWMC, the
National Ecology Center and the LGUs to carry out the mandate of the
Act has not been released by the Department of Budget and
Management. As a result, the NSWMC, thru the DENR-EMB was not
able to undertake majority of its mandated functions. Nevertheless, the
NSWMC has reported the following accomplishments with EMB
utilizing the available funds of the Bureau:

11

SOLID WASTE MAGEMENT FRAMEWORK

Gathering data needed for the preparation of the National SWM Status
Report to be used as basis in formulating the National Solid Waste
Framework;
Issued the Implementing Rules and Regulations (IRR) of R.A. 9003 with
the assistance of the United Nations Development Program (UNDP);
Drafted 7 guidelines to support the enforcement of the Act;
Issued guidelines to encourage LGUs to establish and operate Materials
Recovery Facilities (MRFs) and composting facilities;
Issued guidelines on the operation of controlled dumps as temporary
disposal sites until 2006;
Finalized guidelines on duty and tax-free importation of Waste Recovery
and Recycling Equipment with the Department of Finance;
On-going formulation and pilot- testing of model SWM Plans in 3
provincial cities;
Implementation of Integrated SWM Programs with donor assistance in the
Visayas (Regions VI, VII and VIII);
Provided assistance to 30 LGUs in the conversion of open dumpsites to
controlled dumpsites, one of which was Lingunan dumpsite in Valenzuela
City;
Assessed potential sites for waste processing and disposal facilities;
Conducted technical review and technology evaluation of 23 proposed
waste management projects and technical advice to proponents;
Showcased MRFs and Ecological SWM projects nationwide;
Conducted information and education campaign:
a.
b.
c.

Prepared, printed and distributed manuscripts, brochures, flyers


and leaflets;
Conducted 46 lectures and 6 observation trips to pilot projects in
MRF;
Conducted trainors training for DENR regional offices and LGU
leagues with University of the Philippines Center for Integrated
Development Studies (UPCIDS).

Negotiated for the approval of 5 foreign-assisted projects to be funded by


UNDP, Asian Development Bank (ADB), German Development
Bank/German Agency for Technical Cooperation (GTZ/KFW), Japan
Bank for International Cooperation (JBIC), United States Agency for
International Development (USAID).

2.11.2 The following LGUs were able to partially implement R.A. 9003 thru
the following:

Marikina implemented the waste segregation scheme by directing


residents to segregate their solid waste into biodegradable and non-

12

SOLID WASTE MAGEMENT FRAMEWORK

biodegradable and fielding two trucks at the same time for collection. The
scheme enabled the City to give livelihood to families engaged in
scavenging by commissioning them as sorters of solid waste paid on a
daily basis while at the same time earning an income from sale of
salvaged solid waste for the City.

The City of Valenzuela on the other hand, has established its Ecology
Learning Center (ELC) in April 1999 which was further
strengthened/improved to meet the requirements of RA 9003. Based on
their 10-year ESWM Plan, R.A. 9003 will be implemented as follows:
Period
1999-2001
2002-2004
2005-2008

Implementation/Coverage
Involving 4 barangays
Including additional 15 barangays
Covering the 32 barangays of the City

Malabon City has also partially implemented waste segregation and


composting in 3 barangays and tapped recycling companies where
recyclable materials are sold.
As reported, the City has
accredited/registered 60 junkshops with an average of 3 wastes pickers
(ECO aides) per junkshop and 5 recycling companies. There are also a
number of Subdivision Homeowners and neighborhood Associations in
Barangays Potrero, Concepcion, Niugan, Tinajeros and Tonsuya
implementing wastes segregation through recycling and composting.
There are also 7 major organizations with social components for Waste
Management.

2.11.3 As head of the Regional Waste Management Board/Metro Manila


Council on SWM for Metro Manila, MMDA had likewise initiated
various meetings with City/Municipal mayors and drafted the proposed
Guidelines and Procedures for the Unified Approach on SWM for
households, business establishments and institutions in Metropolitan
Manila which has the following components:

Storage of waste
Discharge or set out of waste for collection
Waste collection system
Waste collection truck standards
Conduct of public information, education and communication (IEC)
campaigns
Administrative procedures and imposable administrative fines
Collection and disposition of fines
Penal provisions

13

SOLID WASTE MAGEMENT FRAMEWORK

2.11.4 As of February 28, 2002, a total of P112,014,130 was granted by the


MMDA to 16 cities/municipalities in the Metropolis in the form of cash
advances for the maintenance and operation of disposal facilities in
LGUs. Of this amount, only P20,980,803.42 has been liquidated by 5
LGUs. In addition, Malabon City was granted permission by the
MMDA Chairman on October 18, 2001, to utilize the 5% Internal
Revenue Allotment (IRA) of the City supposed to be remitted to
MMDA as contribution for the operation and maintenance of disposal
facilities including the Citys dumpsite in Catmon, Malabon, for SWM
services.

2.12 Involvement of industry


2.12.1 Not all LGUs audited were servicing industrial and commercial sectors
of the City as most of the owners of industrial/business establishments
contracted the services of private haulers to collect and dispose of their
solid wastes.

2.13 Costs associated with waste management


2.13.1 The management of solid wastes in Metro Manila involves significant
costs to the government and the LGUs. The total cost of SWM incurred
by the LGUs cannot be determined since detailed costing data was not
available at the time of the audit. Only the total cost of contracting out
the services, for the collection, cleaning and disposal of solid waste in
the 7 LGUs and the cost of implementing SWM by administration in 3
LGUs audited were obtained. These are as follows:
EXPENSES
CITY

2001

2002

BY CONTRACT:

Quezon
Manila
Makati
Pasay
Caloocan
Pasig

P 681,476,044.45**
473,153,280.00**
534,066,584.22**
224,980,320.00**
286,556,805.00**
177,945,002.00

P 541,170,098.28*
493,468,800.00**
NA
232,320,000.00**
247,380,000.00**
175,708,494.00**

14

SOLID WASTE MAGEMENT FRAMEWORK

CITY

Mandaluyong

EXPENSES
2001
140,603,097.21@

2002
NA

BY ADMINISTRATION:

Marikina
Malabon
Valenzuela

63,834,061.69
43,907,342.96
49,068,836.00

NA
25,046,857.33***
38,700,187.00***

- Contract cost from July 2002 to June 2003, Actual expenses as of


June 2002
was P 294,701,775.07.
** - Contract cost
*** - January June, 2002
NA - Not available
@ - total expenses

The expenses relating to other activities in SWM operations such as


salaries of WMO personnel and expenses in monitoring could not be
derived as the cost were incorporated in the expenses of the Department
where WMO was part of.
2.13.2 The costs incurred by industries, commercial/business establishments
and selected subdivisions, which are not being serviced by the City
Governments, for the collection and disposal of their wastes are not
also included in the above figures.

15

PART III

Audit Observations
and
Recommendations

16

CHAPTER 1

Established Policies and Procedures

17

ESTABLISHED POLICIES AND PROCEDURES

INTRODUCTION
3.1

The success of any undertaking depends partly on established policies


and procedures pronouncing the purpose and objective of the activity or
program and specifying the step by step procedures to attain the
objective. These policies and procedures should be properly
disseminated to concerned officials and employees to guide them in the
performance of their duties and responsibilities.

3.1.1

Generally, LGUs contracting out the collection, cleaning and disposal


of solid wastes do not have adequate guidelines in the selection and
awarding of contracts for this type of service. In two LGUs, the
eligibility requirements of the contractors were defined. However, the
contractors commitment for the same services with other LGUs and
private entities were not required to be submitted. Hence, LGUs could
not assess the actual resources committed to the services being bidded
out.

3.1.2

In other LGUs, basic factors such as contractors financial capability,


track record and adequacy of equipment were not even considered in
the evaluation of contractors capability. As a result, some contractors
awarded the contracts were not qualified to undertake the services
required leaving some solid waste in some areas uncollected.

OBSERVATION
Generally, LGUs do not have adequate policies and procedures in
the selection of contractors for the collection, cleaning and disposal
of solid wastes. While two LGUs were able to define contractors
qualifications, the bidders were not required to submit their current
and present commitments with other LGUs and private entities to
assess the actual resources committed to the services being bidded
out. In other LGUs, basic factors such as financial capability,
adequacy of equipment, experience/track record on solid wastes
hauling, technical proposal and work plan were not even considered
in the evaluation. This resulted in the awarding of contracts to
contractors not qualified to undertake the required services as
18

ESTABLISHED POLICIES AND PROCEDURES

manifested in their inefficient performance which increased the risk


of uncollected solid wastes posing health and environmental hazards.
3.1.3

Of the ten LGUs covered in the audit, 7 were contracting out the
collection, cleaning and disposal of solid wastes to private contractors
either on a clean up or per trip basis. The audit however disclosed that
while contracting out has been practiced for several years, the LGUs
have not established policies and procedures in selecting contractors to
undertake SWM operations. The City Governments of Quezon and
Pasig however managed to define the qualification of contractors
allowed to participate in any bidding undertaken for this purpose.
However, the bidders were not required to submit their current and
present commitment with other LGUs and private entities for the
provision of the same services to assess the actual resources available
for the services being bidded out.

3.1.4

In other LGUs, their requirements were incorporated either in the


Instructions to Bidders or prequalification documents. The team
however noted that basic factors such as capitalization, track records/or
experience and number of equipment needed to undertake the required
services were not even specified in these documents.

3.1.5

In the case of Manila, the Citys requirements and specific activities


were incorporated in the contract. The contractors were however not
required to submit technical proposal or comprehensive work plan
indicating strategies to undertake the contracted activities.

3.1.6

All these deficiencies contributed in awarding of contracts to


contractors not qualified to undertake solid wastes collection and
disposal.

3.1.7

Of all LGUs, the City Government of Quezon was the only City to have
issued Executive Order providing guidelines in the conduct of public
bidding and award of contract for solid waste collection and disposal
services.

3.1.8

Under the Executive Order, the Quezon City Government will issue
Terms of Reference (TOR) where the contractors qualifications are set
as follows:

Two years in the solid waste hauling service or similar activity;

19

ESTABLISHED POLICIES AND PROCEDURES

Has at least the minimum number of trucks to service the district/subdistricts bidded for and at least 20% of the minimum as reserve units.
In case the prospective bidder opts to apply in more than one
district/sub-district, the minimum number of units should be
equivalent to the minimum number of trucks required in said
districts/sub-districts plus the 20 % as reserve units;
Owns 50% of fleet;
Has at least 1 service vehicle for every 10 units of truck for
monitoring and information dissemination. Said vehicles should be
equipped with a public address system;
Must provide with the necessary Information and Educational
Campaign (IEC) materials for their information dissemination
activities;
Has a complementing solid waste and/or dispatching area appropriate
to the size of its fleet equipped with maintenance facilities and
manpower;
Eligible contractors may submit bids in one or more than one
district/sub-district open for bidding;
Has the financial capability to sustain operations during the duration
of the contract;
Submission of Work Plan containing the following information:
a.
b.
c.
d.
e.

Collection equipment mix;


Schedule for collection for each type of cell;
Identification of collection system for inaccessible areas in
coordination with the City and Barangay;
Motor pool or garage appropriate to accommodate its trucks
within the City;
Strategies to conduct information and education campaign at
the community level in coordination with the City
Government.

The TOR also set penalties in case contractors failed to comply with
the following requirements to be deducted from the contractors billing:
Violation/Requirement

Lack of any paraphernalia/


accessories
including
nonwearing of uniforms and
identification cards
Improper solid waste collection

No waste collection was done

Penalties
P250.00
per
lacking/truck/day

item

Amount equivalent to one


cell/day
150 % of the amount of one
cell/day

20

ESTABLISHED POLICIES AND PROCEDURES

Violation/Requirement

Spilling while in transit

Allowing unauthorized crew on


board the truck during collection
Crew asking or soliciting either
cash or in kind
Scavenging during collection
and/or while on route
Non-action on complaints within
the day of reporting

Penalties
Amount equivalent to one
cell/day
Amount equivalent to one
cell/truck/day
150 % of the amount of one cell
/day
Amount equivalent to one
cell/complaint/day
Amount equivalent to one cell

These requirements contributed in ensuring the selection of qualified


contractors. However, as discussed earlier, the LGUs should also
require the bidders to submit their current and present commitment to
undertake the same services with other LGUs and private entities
including the list of equipment and relevant resources committed to
said entities. These information should be considered in evaluating the
contractors capability to undertake the required services with a specific
LGU. While the bidders may have submitted sufficient resources to
undertake the services being bidded out, their commitment with other
Organizations affect their performance as manifested in the results of
audit.
3.1.9

The failure of the LGUs to establish policies and procedures for SWM
operation resulted in awarding of contracts to contractors who were not
capable of undertaking the tasks as illustrated below:

Caloocan City

a.

Southport Trading and Warehouse Services, Inc. was awarded a


contract for the collection and disposal of solid wastes in Area I
when the contractor has only 13 units 10-wheeler dump trucks
and 7 units 6-wheeler dump trucks. The number of trucks
required for this contract per teams computation based on
estimated solid wastes to be collected of 984 cu. m. daily
considering the citys standard of 2 trips per day is 31 units 10wheeler dump trucks. In a survey conducted by the team, 26% of
101 residents who claimed of incidence of uncollected solid
wastes were being serviced by this contractor.

21

ESTABLISHED POLICIES AND PROCEDURES

b.

Other accredited contractors of Caloocan City could not be


evaluated as to sufficiency of equipment as there were no lists of
equipment provided to the team.

c.

During the audit, the audit team was consistently reminding the
SWM officials on uncollected solid wastes most particularly in
major thoroughfares in Barangay 177 particularly along Zabarte
road within the jurisdiction of Caloocan City.

d.

The team also observed the increased incidence of uncollected


solid wastes during and after the audit which is also manifested in
the results of survey conducted by the team in selected areas.

Makati City
The contractor in different areas have not been meeting the
required number of trips as illustrated below:

Contractor
E.C. Sarrol
REN Trans.
Corp.
R.T.
Machineries,
Inc.
ACY Trans.
Corp

Req.
Daily
No. of
Trips

No. of
Trips /
Day per
Dispatch
Report
(Range)

Discrep
-ancy
per
Day

No. of
Equip.
Utilized

Contractors
Equipment
per
Inspection

No. of
Equip.
Req.

29

20-26

3-9

12

27

15

67

48-56

11-19

26

350

34

38

29-32

6-9

16

20

19

69

45-55

14-24

26

44

35

203

Quezon City
a.

While it is required in the Citys regulations that the bidders


should have at least the minimum number of trucks/equipment to
service the district/sub-districts and at least 20% of the minimum
as reserved, three bidders were awarded the contracts without
meeting the minimum requirement as illustrated below:

District

Contractor

Min.
Req.
No. of
Trucks

I
III
IV

Dodge
Omni
IPM

47
50
56

20%
Reserve

Total
No. of
Trucks
Req.

No. of
Trucks
per
Proposal

Difference

Contractors
score per
BACs
evaluation

9
10
11

56
60
67

54
51
56

2
9
11

15 %
15 %
14 %

22

ESTABLISHED POLICIES AND PROCEDURES

b.

As illustrated above, two were given perfect score of 15% and


the other 14% when they were short by 2 to 11 equipment.

c.

Review of the dispatch reports submitted by OMNI to SWMO


showed that it was able to field a daily average of only 39 trucks
equivalent to only 65% of the minimum of 60 units required
under its TOR. As a result, the contractor was able to cover only
2,226 cells for the month of July 2002 when the contract required
the servicing of 2,454 cells. This had unfavorably affected the
contractors performance in collecting solid wastes within
District III.

Manila City
While the contract specify the requirements of the City, the
bidders were not required to submit work plan or technical
proposal detailing the strategies to implement the services
required under the contract. As such, the obligations of the
contractors were not clear. In the equipment work plan
furnished to the team, it would even appear that a lesser number
of equipment would be fielded than what has been required
under the contract. Some issues not clear in the contract follow:
a.
b.
c.

The time of collection and distribution of equipment;


Collection method;
Strategies to produce and disseminate the required leaflets and in
fielding the number of street sweepers contracted;
d. Minimum volume of solid wastes to be collected daily;
e. Manner of utilizing the service vehicles, the stationary dump
trucks, water trucks and truck mounted street sweepers.

Mandaluyong City
The basis of awarding the contract to the lone contractor could
not be determined as there were no bid and other related
documents provided to the team attesting the qualifications of
the contractor. The contract has been consistently awarded to
the same contractor since 1999 with the contract cost for CY
2001 increased by 46.11% without any explanation and
justification.

23

ESTABLISHED POLICIES AND PROCEDURES

Pasay City
a.

The bidders commitment with other cities and municipalities


were not required to be disclosed. The City then was not able to
consider in the evaluation, the current business interest of some
bidders in other localities such as:

Contractor
a. Greenline
Onyx
Envirotech
Phils. Inc.
(GOEPI)

On-going Contracts
-

b. RM
Maintenance
Services
b.

Quezon City
San Juan
Ayala Center
Association
Ecology
Village
Ecology
Village
Condominium

2001-2002
1992-2002
1995-2001

Caloocan City

2001-2002

1998-2002
1998-2002

This will affect the provision of critical elements of the


contracts specifically, capital and equipment. Consider this:

Truck/Equipment
per inspection
GOEPI
RM
Maintenance

c.

Period Covered

11 10 wheeler DT
12 6 wheeler DT
13 10 wheeler DT
2 6 wheeler DT

Equipment requirement in
the cities with existing
contracts
Quezon
Caloocan
40

Equipment
required
for Pasay
8

14

This only shows that the bidders do not have enough equipment
to simultaneously enter into contract with different Cities. Their
capability to collect and dispose of solid wastes in their
areas/sectors were therefore questionable. This was manifested
by uncollected solid wastes noted by the team during ocular
inspection at Tolentino Street under Sector 3-E serviced by RM
Maintenance Services. (Annex 1)

24

ESTABLISHED POLICIES AND PROCEDURES

Pasig City
The bidders were likewise not required to submit their on-going
and current commitment with other LGUs and private
organizations. This led to the contractors failure to efficiently
collect solid wastes in their area of responsibility as in the case
of IPM Construction. The contractor has simultaneous contracts
with Pasig and Quezon City Governments and the Municipality
of Taguig. For the month of November 2002 alone, the
contractor failed to collect 1 to 5 dump trucks and 2.5 to 10 mini
dump trucks of solid wastes daily within 19 days.

3.1.10 The selection of qualified contractors is necessary as some of the risks


associated with SWM were transferred to the contractors. Risks
associated with the operation of SWM should be properly managed by
addressing them in the formulation of policies and procedures. Risk
management is recognized as an integral part of good management
practice. It is the term applied to a logical and systematic method of
establishing the context, identifying, analyzing, evaluating, treating,
monitoring and communicating risks associated with any activity,
function or process in a way that will enable organization to minimize
losses and maximize opportunities.
3.1.11 It is also important to note that an effective risk management
encompasses the acceptance of small mistakes, while encouraging
officials to consider the lessons learned in order to avoid the same
mistakes in the future.
3.1.12 The presence of uncollected solid wastes due to selection of unqualified
contractors poses health and environmental risks to the stakeholders
and the public as uncollected waste is a place for breeding disease
vectors and pollutes water bodies. It also causes aesthetic problems
such as odor and considered as eye sores.
3.1.13 The audit also covered 3 cities undertaking SWM by administration.
Evaluation of their existing systems revealed the following practices
that contributed in the enhancement of the Cities SWM operations:

Marikina City

a. Waste segregation at source;


b.

Bringing solid wastes out on scheduled collection day;

25

ESTABLISHED POLICIES AND PROCEDURES

c.
d.
e.

f.

Malabon City
a.
b.
c.
d.

Proper handling of solid wastes by collection crews eliminating


spillage and scatters during transport;
Cleaning/flushing of equipment and facilities to eliminate odor;
Requiring public transports to provide trash containers for their
passengers to eliminate indiscriminate throwing of wastes on the
roads while in transit; and
Maintenance of Motor pool.

Designation of temporary stations or pick-up points where barangay


residents could place their solid wastes;
Encourage support from barangay. There were barangays which
directly dispose their collection to the dump site;
Implementation of wastes segregation and composting in 3
barangays;
Accrediting junkshops and tapping recycling companies.

Valenzuela City
a. Drafting and implementation of the Citys Ecological Solid Waste
Management Plan (ESWMP) which specify the objectives,
implementation strategies and specific activities to be undertaken
under RA 9003;
b. The gradual transfer of responsibility from the City Government to
Barangays of collection, transport and disposal of recyclables and
biodegradables. Collected segregated bio and non-biodegradable
wastes in 6 barangays were brought to the Ecological Learning Center
(ELC) for processing and recovery. Recyclable wastes were also sold
to selected recycling companies and/or used by students on their
projects or brought home for processing. (Annex 2)

Managements Response

Teams Rejoinder

Response provided by the Mayor,


Quezon City:
Inspite of all these observations,
the City is satisfied with the
performance of these winning
bidders. Although their efficiency
in July was low, this can be
attributed to the fact that the new

The team evaluated the contractors


performance
in
July
2002.
Considering the contract covers July
2002 to June 2003, unless the
contractors increased the number of
equipment to cover all the cells

26

ESTABLISHED POLICIES AND PROCEDURES

Managements Response

Teams Rejoinder

system of collection, the Package


Clean-Up System, was just
implemented on July 1, 2002. The
change in the system brought about
unforeseen
circumstances.
Although the City, the EPWMD
and the winning contractors
prepared well for the change there
were
certain
extenuating
circumstances that gave rise to the
problems in the collection. One
classic example was the short
period that the City gave the
contractors to prepare their
equipment to comply with all the
requirements set forth in the
Contract of Agreement. However,
records will show that the City and
the contractors were able to finetune the new system so as to
normalize
the
solid
waste
collection
operations.
The
performance efficiency of the
contractor for the month of August
reached as high as 99.96 while the
lowest is 97.26.

required under the TOR, the


contractors would not be able to
totally maintain a garbage-free area.
Results of the survey conducted from
August 2002 to September 2002 also
showed that 24 or 51% out of 43
respondents still complained of
uncollected piles of solid waste in
their areas. This would therefore put
to question the alleged high efficiency
performance in the month of August.

Response provided by the Vicemayor of Makati:


Since 01 January 2002, the City
has adopted the Package Deal
System of contracting its garbage
collection and disposal. The
objectives are defined in all the
contracts with the garbage
contractors.
The Package Deal contract requires

The team acknowledged that the


objective of the contract and the
obligations of the contractor are well
defined in the contract except for the
number of equipment to be fielded.
This should be clearly stated in the
contract. The term sufficient
number is subject to different
interpretation and does not bind the

27

ESTABLISHED POLICIES AND PROCEDURES

Managements Response

Teams Rejoinder

the contractors to field sufficient


number of dump trucks in the
collection of waste in the service
areas. Thus, the contract states that
the contractor shall provide the
requisite
number
of
dump/compactor trucks, payloader
and other support equipment
sufficient in number for the
performance of its services and
shall be in good running condition
with a well maintained physical
appearance to be used exclusively
for Area (service area).

contractors to field a specific number


of equipment daily. The City should
also consider conducting a spot
inventory of all equipment marked, as
prescribed by the City to ensure that
sufficient equipment were servicing
the City Government of Makati.

The City Government is not


precluded from requiring the
contractors to field additional
trucks if necessary, due to
unforeseen eventualities and based
on the results of the daily
monitoring being conducted by the
Datu Basurero, barangay, District
Operations staff and complaints
received and recorded by the
Action Line.

As discussed in the report, the


contractors were not even fielding
sufficient number of trucks to collect
the estimated garbage generation for
the day. The number of trips daily as
summarized from the Daily Dispatch
Report is less by 3 to 24 trips a day.

Response provided by the Mayor,


Manila:
Our policies may not be perfect but
surely it is working for the City of
Manila.

The policies may be working for the


City. But for such policies to be
effective,
the
same
should
continuously be enhanced and
improved. As it is, there were some
deficiencies that need to be corrected

Although the contractor has not


submitted a work plan in writing,

The team recognized that there could


be verbal discussion to resolve

28

ESTABLISHED POLICIES AND PROCEDURES

Managements Response

Teams Rejoinder

it being not part of the contract, the


DPS has discussed this with the
former. In fact, adjustments have
been made to improve the work
plan as a result of these meetings.

various issues. However, if such


discussion and commitments were not
put in writing, it could easily be
forgotten and could not be properly
monitored. The effectiveness and/or
deficiencies on such strategies
therefore could not be assessed.

There is a work plan as to how


trucks will be dispatched and the
audit task force was given a copy
of this.

As discussed in the report, the


equipment work plan furnished to the
team does not reconcile with the
equipment requirements per contract.

Response provided by the City


Administrator, Pasay:
The
Bidding
and
Awards
Committee will look into the
policies and procedures in the
selection process and should any
improvements most beneficial to
the City Government surface it
shall be adopted without delay.

The team appreciates the LGUs


reaction on the teams observations.

The CY 2003 Terms of Reference


will require the contractors to
declare other on-going contracts
with the LGUs and private
establishments to enable the
selection committee to gauge their
capacities to efficiently perform
even in the presence of other
contracts.

Response provided by ESC Head,


Mandaluyong:
January 1, 2001 was the start of the

The contract for CY 2001 contains

29

ESTABLISHED POLICIES AND PROCEDURES

Managements Response

Teams Rejoinder

worst garbage scenario that


affected the entire Metro Manila.
The City of Mandaluyong was one
of those LGU's hardly hit because
it does not have a land area that
can accommodate a temporary
garbage storage or disposal site.

the same provisions as that of CY


1999 except for the increase in cost
per trip which is not explained at all.
The provision for the use of the
MMDA
dumpsite
is
also
incorporated therein. It specifically
provides that the present designated
dumping site being used and availed
of by the City is the First Metro
Manila Sanitary Landfill Station at
San Mateo, Rizal. It is also provided
therein, that should there be certain
dues or fees that shall be imposed at
the dumpsite area, said dues or fees
shall be for the account of the City
which shall be billed separately
provided that the same are supported
by official receipts of payment. The
cost of dumping therefore could not
be used as a basis of increasing costs
since it is shouldered by the City and
specifically identified in the contract.
Besides, there were no documents to
show that the contractor was
dumping in places such as
Pampanga, Nueva Ecija and the like.
For CY 2002, when the costs per trip
is similar to CY 2001 which was
higher by 46.11% when compared
with the previous contract, the
contractor is dumping in Valenzuela
City and Coastal Road as reflected in
the trip tickets. These places are
relatively nearer to the City than San
Mateo Landfill.

Due to the worsening garbage


crisis, and like other LGU chief
executives, the City Mayor
demanded from the contractor
immediate action and solution to
the problem.
The local chief
executive and the contractor has to
execute the so called "guerilla style
of dumping" by availing of secret
dumpsite regardless of the
distance, costs and consequences.
Private landowners took advantage
of the worsening condition, by
offering the use of their vacant vast
track of lands but at the same time
charging astronomical rates per
truckload. Garbage are dumped
either in Bulacan, Pampanga,
Nueva Ecija, Cavite, Laguna and
as far as Batangas. There have
been several instances when dump
trucks and personnel were detained
for illegal dumping.

On Risk Management Process


Generally, all LGUs agreed to the

The team appreciates the responses of

30

ESTABLISHED POLICIES AND PROCEDURES

Managements Response

Teams Rejoinder

teams observations on the need


for structured processes in
managing risks.

the LGUs on this observation and in


realizing the importance of having a
structured processes in managing
risks. This is applicable not only on
SWM operation but in other LGUs
operations as well.

RECOMMENDATION
The LGUs should consider:
1. Formulating adequate policies and procedures in the selection of
contractors for the collection, cleaning and disposal of solid waste.
The procedures should ensure that only qualified contractors are
awarded contracts by including factors such as the required
capitalization, number of equipment, current commitment for the
same services with other LGUs/entities, and years of
experience/track record on hauling of solid wastes. The bidders
should also be required to submit a work plan or technical proposal
containing among others the following:
a.
b.
c.
d.
e.
f.
g.
h.

Collection Schedule;
Equipment mix appropriate for the area to be serviced;
Collection strategies for inaccessible areas;
Provision for motor pool and dispatching area;
Strategies for disseminating information materials:
Collection equipment and paraphernalia;
Available manpower;
Proposed actions on complaints.

2. Establishing a risk management process to identify all possible


risks in the implementation of SWM operations. The risks should
be evaluated in order to determine the possible impact in the
effective performance of the contractors.

31

ESTABLISHED POLICIES AND PROCEDURES

3. Developing appropriate treatment plans for the identified risks and


determining the persons responsible in executing the plan at the
appropriate time. The intended treatment should as much as
possible, avoid the occurrence of the risk and/or manage its effect
or impact in the attainment of SWM objective. There should also be
periodic monitoring and review of the risk plan to ensure its
relevance with the current trend in SWM operation.

32

CHAPTER 2

Appropriate Resources

33

APPROPRIATE RESOURCES

INTRODUCTION
3.2

Appropriate resources are important to the success of SWM programs


in every LGU. Resources include competent and adequate financial
budget to undertake the activities needed to ensure that the objective of
a particular program is achieved. To guide the LGUs in assessing the
adequacy of the budget reserved for a particular program is a
comprehensive work plan. The plan should properly indicate the
budget per activity.

3.2.1

The audit however disclosed that except in the case of Marikina, the
LGUs audited were not preparing a comprehesive plan for SWM
operations. The SWM plan and budget were incorporated in the plan
and budget of the Department where SWM operation was part of. The
total amount budgeted for SWM operation, except for payment to
contractors were not specifically provided.

3.2.2

The team also noted that in some LGUs, total expenditures of the
Department and payments to contractors exceeded the funds
appropriated for the purpose. The failure of the LGUs to determine the
total funds needed for SWM operations affects the efficient
performance of contractors and effective implementation of SWM as
manifested by increased incidence of uncollected solid wastes and
inadequate implementation of information/education campaign on
proper SWM operation.

OBSERVATION
Except in the case of Marikina, the total budget and expenditures for
SWM operations in 2001 and 2002 could not be determined as the
SWM budget and expenditures were included in different
Departments of the LGUs where SWM operations is part of. The
LGUs do not also prepare a comprehensive plan for SWM operation
properly indicating the budget per activity. As a result, the adequacy
of SWM budget could not be determined. The failure of the LGUs to
provide funds needed for SWM operation affects the efficient and
effective implementation of SWM operation as manifested in
unsatisfactory performance of some contractors.
34

APPROPRIATE RESOURCES

3.2.3

SWM is one of the programs being administered by the following


Departments of the audited LGUs:

LGUs

Department

Marikina CIty
Quezon City
Manila
Pasay
Caloocan
Valenzuela

Environmental Management Cluster


Environmental Protection and Waste Management Dept.
Department of Public Services
Office of the Mayor
Environmental Sanitation Services
Clean and Green Office
Solid Waste Management Office
Office of the City Administrator
Office of the City Mayor
Environmental Cleaning and Beautification Dept.
Environmental Sanitation Dept.
Office of the Mayor

Malabon
Mandaluyong
Makati
Pasig

These Departments are performing similar functions which can be


summarized as follows:

Administrative such as, recruitment of personnel, records management,


preparation of budget and accomplishment report, procurement, etc.;

Environmental and SWM activities such as:


a.
b.

c.

d.
e.

f.
g.
h.
i.
j.
k.

collection and disposal of solid wastes;


enforcement of policies, laws and ordinances relative to
environmental protection/SWM programs and removal of
obstructions within the Citys territorial jurisdiction;
establishment and maintenance of a monitoring system to ensure
proper collection and disposal of wastes including conducting
survey;
formulation and implementation of civic consciousness programs
geared towards environmental sanitation;
establishment of linkages and coordination with proper offices of
the City Government and other government agencies for the
promotion of environmental projects;
maintenance and operation of a comprehensive pollution control
program including anti-belching and industrial pollution;
conducting studies and researches on environmental
management;
street sweeping/cleaning/canal cleaning;
conducting special environmental projects;
maintenance of City parks;
removal/relocation of informal settlers;

35

APPROPRIATE RESOURCES

l.

conducting seminars/information campaign on environmental


protection including proper management of solid waste;
m. implementing cleanliness/beautification project including
painting of gutters and center islands;
n. Maintenance of Motor pool;
o. Operation of the Citys Ecological Learning Center (Valenzuela);
p. Selling recyclable materials to selected recycling companies
(Valenzuela, Malabon and Marikina); and
q. Maintenance of hauling equipment.

3.2.4

Except in the case of Marikina City, the budgets for these Departments
were not broken down into programs. For this reason, the team could
not determine the total budget and expenditures for SWM operations.
This was aggravated by the absence of comprehensive plan for SWM
operation properly indicating the budget per activity. Only the total
amount budgeted for payment to contractors were specifically
indicated. The absence of a comprehensive plan would deprive LGUs
to determine the adequacy of the budget provided for SWM operation.
For CYs 2001 and 2002, the audited LGUs have appropriated/budgeted
and expended funds for their environmental protection/sanitation
programs as follows:
2001 (in million pesos)

Total
Budget

LGU
Quezon
Manila
Makati
Pasay
Caloocan
Pasig
Marikina
Malabon
Valenzuela
Mandaluyong

NA
617.1
433.6
228.10
378.07
185.30
71.25
16.50
45.30
165.47

Total
Exp.

Payt. to
garbage
contactors

N.A.
574.99
NA
NA
348.51
N.A.
63.83
43.91
49.10
140.60

NA
473.2
534.1
225.0
286.55
177.95
NA

2002 (in million pesos)

Total
Budget
668.13
489.5
544.4
250.30
343.89
149.90
47.0
16.50
43.70
97.96

Total Exp.
for Jan. June

Payt. to
garbage
contactor

N.A
314.01
NA
N.A
133.54
N.A
N.A
25.05
38.70
NA

NA
246.90
NA
116.20
116.93
87.85
NA

N.A. Not Available

It can be noted from the above tabulation that in some LGUs,


expenditures for 2001 exceeded the funds appropriated for
environmental protection/sanitation programs. In 2002, expenses
incurred by some LGUs from January to June were already more than
half of their annual appropriation.

36

APPROPRIATE RESOURCES

3.2.5

The expenses that could not be accounted for were related to salaries
and allowances of SWMO Officials and staff, maintenance of SWMO
and activities related to street sweeping, apprehension of violators of
environmental laws and information dissemination.

3.2.6

The failure of the LGUs to determine the total budget needed for SWM
operations affected the efficient and effective implementation of the
project as manifested in the following:

Trucks for hauling solid wastes which need repairs could not be
repaired due to lack of spare parts, thus affecting the number of trucks
fielded;
Hauling equipment which are beyond repair could not be replaced
due to lack of funds. As a result, daily collection schedules/routes
was not followed leaving uncollected solid wastes in the areas not
covered. This poses health risk to the Citys constituents;
Payments for services of contractors were delayed by 3-27 months
after the billing date;
Information/education campaign on proper SWM through seminars
and distribution of flyers were compromised;
Ecological SWM projects could not be implemented;
Incidence of uncollected solid wastes due to lack of monitors.

Managements Response

Teams Rejoinder

Response provided by the Mayor,


Pasay City Government:
The City will review the audit
recommendations and find the best
way to assist in improving the
existing system.

The team appreciates the actions


taken by the City on the teams
observation. A comprehensive plan
for SWM operation indicating the
specific budget per activity should be
prepared to ensure availability of
funds for each activity.

Response provided by the Mayor,


Valenzuela City:
Following the recommendation of
the audit team, the following steps

The team appreciates the actions


taken by management to correct the

37

APPROPRIATE RESOURCES

Managements Response
shall be done:

Teams Rejoinder
deficiencies noted.

- Propose to the city council the


separation of funds for SWM by
removing the budget intended
for SWM from the engineering
department;
- Conduct inspection of garbage
trucks/compactors
and
determine which of these trucks
need major repair and propose
budget for the repairs to the City
Council in order to make all the
garbage trucks operational.

Response provided by the Head,


Environmental
Protection
and
Waste Management Department
(EPWMD), Quezon City:
Payment Process- Under the new
administration, this is now being
corrected. The Head of EPWMD
has issued a Memorandum to the
contractors giving them only 7 days
within which to submit their
statements of billing for the current
month, otherwise their claims will be
processed together with their claims
for the succeeding month.

The team appreciates the action taken


by management to expedite payment
to contractors so as not to
compromise efficient delivery of
services.

Response provided by the Secretary


to the Mayor, Caloocan City:
The financial constraints being
experienced by the city has already
affected major services it rendered to

It is commendable for the contractors


to have been continuously serving the
City despite delayed payments.

38

APPROPRIATE RESOURCES

Managements Response

Teams Rejoinder

the residents.
Considering the
impact of garbage problem on the
economy and health of
its
constituents, and in order to ease the
financial problems the city is facing,
deferred monthly payment plan
agreement were forged by the city
with WMSCs in the spirit of
community service.
This is the
reason why payment for their
services is overdue by 1 to 6 months.
Moreover, this delay has never
affected the efficiency of our service
contractors. They continue to ply
their route and collect garbage.

However, it could not be denied that


the contractors performance is
affected by such delays as reflected in
the surveys conducted by the team.
The preparation of a comprehensive
work plan with specific budget per
activity would give the City an
opportunity to reassess their financial
condition
and
prioritize
their
expenditures.

RECOMMENDATION
The LGUs should consider preparing a comprehensive work plan for
SWM operation indicating all activities needed to efficiently and
effectively discharge the functions with corresponding budget per
activity. This would more or less guide the LGUs in determining the
amount to be budgeted to achieve the objective of a garbage- free
environment.

39

CHAPTER 3

Sound Management
and
Monitoring Mechanisms

40

SOUND MANAGEMENT AND MONITORING MECHANISMS

INTRODUCTION
3.3

The effectiveness of the program can only be measured through


regular monitoring and review. Monitoring and review is the final
component of an effective control structure and is closely linked to
information and communication. Monitoring provides assurance and
feedback on whether program objectives are being achieved efficiently
and effectively. It also provides an on-going check on the effectiveness
of the control measures.

3.3.1

The audit concluded that generally, selected LGUs do not have


adequate policies and procedures including performance
indicators/standards to assess contractors performance. While some
LGUs have established indicators, these were not adequate and there
were no parameters set to measure contractors performance which can
be gauged on the number of instances contractors failed to act on the
following, among others:

to collect solid wastes on time or as scheduled;


to field the required number of equipment;
to disseminate the required quantity of information materials;
to prepare information materials in accordance with the standards set;
and
to act on any complaint particularly on uncollected wastes.

In view of the noted deficiencies, the LGUs do not have an opportunity


to assess performance of contractors resulting in their failure to institute
measures to improve the same.

OBSERVATION
Generally, LGUs do not have adequate policies and procedures
including performance indicators/standards to assess contractors
performance. While some LGUs have established indicators, these
were not adequate and they have no parameters/standards set to
measure the efficiency of contractors. In view of the absence of
policies/procedures and standards, the monitors were not properly
guided and the performance of the contractors were not effectively
41

SOUND MANAGEMENT AND MONITORING MECHANISMS

assessed. The LGUs then were not able to institute measures to


address these problems and attain their objective of having a clean
and solid waste-free environment.
3.3.2

Under the package deal/clean-up system of collection of solid wastes,


the responsibility in solid waste collection and disposal is transferred
from the LGUs to the contractors. In some LGUs, the contractors are
also responsible to some extent, in conducting information/education
campaign on proper SWM operation including deployment of street
sweepers to ensure a clean environment. In other LGUs, their
respective SWMO are responsible for these activities. Under this set
up, the SWMO should be monitoring the performance of the
contractors.

3.3.3

To effectively perform the monitoring functions, the LGUs should


formulate and implement an adequate monitoring system that would
ensure that all activities contracted are effectively and efficiently
discharged. The monitoring system should also include the
establishment of adequate performance indicators/standards from
which performance of contractors could be measured.

3.3.4

As can be discerned from the contracts, the contractors activities that


should be monitored are the following:

3.3.5

daily collection or as scheduled;


number of trucks fielded;
deployment of street sweepers;
maintaining the area clean;
timeliness of collection;
mopping operation conducted;
information dissemination conducted;
actions taken on monitored uncollected solid wastes;
sufficient number of personnel per truck/trip;
collection of minimum volume of solid wastes;
proper collection method;
availability of gadgets; and
maintenance of appropriate motor pool and garage including workers
to maintain equipment.

The team however noted that while these activities can be used as
indicators by itself, LGUs have not been using such indicators and

42

SOUND MANAGEMENT AND MONITORING MECHANISMS

have not established adequate policies and guidelines to measure


contractors performance. As a result, monitoring activities were not
sufficient and monitoring reports were not complete and documented.
Generally, the activities of the monitors follow:

Prepare monitoring reports. In other cases, the actions taken on


monitored uncollected solid wastes were included in the report;

Inspect the designated area;

Refer to contractors monitored uncollected solid wastes;

Observe the manner solid waste collection was undertaken including


checking of the following contract requirements (Quezon City):
a.
b.
c.
d.
e.
f.

3.3.6

Completeness of the paraphernalia brought by the driver


and his crews;
No spilling of solid wastes while on travel;
Number of crews and accompanied authorized persons;
No Solicitation;
No scavenging;
Uniforms and ID cards of crews.

As the need arises, meet with the contractor and Barangay Chairman
on issues such as systems improvement, suggestions and comments
(Manila);

Involving barangay officials and owner/representatives of other


institutions in monitoring contractors performance by requiring them
to sign on a document to prove that collection was indeed undertaken
(Manila, Quezon City).

Conduct of information dissemination/education campaign on proper


SWM (Quezon City).

Performs truck inspection at least twice every 15 days to ensure


collection trucks are equipped with sanitation gadgets (Pasay);

Monitors street sweepers (Pasay);

Evaluation of these activities however showed that the same were not
adequate to properly assess the performance of the contractors. There
are a number of activities contracted which were not monitored. The
team also noted that in some cases, the monitors were submitting
conflicting reports or declared certain area to be clean when

43

SOUND MANAGEMENT AND MONITORING MECHANISMS

complaints from residents were continuously being received. The team


further noted that the reports prepared by the monitoring teams do not
disclose the following:

3.3.7

3.3.8

number of streets/barangays/cells covered or monitored. Under the


existing condition of the LGUs, the monitors could not cover the
entire City to assess contractors compliance with the requirements.
The reports therefore should indicate the specific streets or barangays
inspected to assess whether the area covered is already representative
of the total area contracted;
the time of collection;
the number of trucks fielded;
the volume collected;
any mopping operation conducted;
compliance with manpower requirements;
any information dissemination conducted;
collection method used;
actions taken on reported/monitored uncollected solid wastes;
activities and presence of street sweepers; and
maintenance of Motor pool/garage.

As the total area monitored were not disclosed in the report, the team
could not assess the extent of monitoring activities undertaken by the
LGUs except in the case of Quezon City where the number of cells
monitored were indicated in the report. Evaluation of the reports made
available to the team covering the month of July 2002 revealed that for
Districts IIA, III and IV, only about 2 to 38% of the total number of
cells assigned to a particular contractor were actually monitored as
illustrated below:

District

No. of cells
contracted

No. of cells
monitored

Difference

Percentage

IIA
III
IV

1,447
2,289
3,052

549
312
53

898
1,977
2,999

38%
14%
2%

In Mandaluyong City where collection is contracted on a per trip basis,


the controls in place at the dispatch station to ensure the accuracy of
the reported volume collected and the validity of the sources of solid
wastes, were not adequate. The sources of solid wastes were not
validated and verified to ensure that these were collected at the
designated area. Likewise, the actual volume collected per truck were

44

SOUND MANAGEMENT AND MONITORING MECHANISMS

not recorded in the logbook. Hence, the reported


be validated. In a number of instances, a six
reported to have collected 18 cubic meters when
maximum of 12 cu. meters. These deficiencies
accomplishments questionable.
3.3.9

collection could not


wheeler truck was
this can only load a
render the reported

In the case of Caloocan City, the contractors performance were


monitored both by the Environmental Sanitation Services and Task
Force 9003. The team however noted that the reports of the two
Offices for the sampled month of July 2002, were not the same. The
Task Force 9003 reported 71 instances of uncollected solid wastes in
Districts I and II. These conditions were not reflected in the Daily
Monitoring Reports prepared by the ESS monitors who declared the
entire route clean. As the reports of the ESS were used to support
contractors claims, the contractors were paid in full. The ESS also
maintains logbook of complaints. Complaints recorded therein were
also not reflected in the Daily Monitoring Reports. From January to
August 2002, records of the ESS showed that there were 1,309
complaints of uncollected solid wastes in different Districts within the
City;

3.3.10 In the case of Pasay City, the monitoring activities could not be
documented as there were no monitoring reports submitted to the
team;
3.3.11 In Makati, the contractors performance was monitored by the Garbage
Collection and Disposal Section and the Support Services Office of
SWM Division. The monitors who are called Datu Basureros round
the area/s assigned and prepare the daily Datu Basurero Situational
Report (DBSR). While the Datu Basureros observed and reported that
areas were clean and entire routes were covered by garbage collectors,
reports on uncollected solid wastes were received by the Action Line
Unit from residents. The head of SWMO issued certificate that the
entire area is clean based on the DBSR. This supports the monthly
claims of the contractors;
3.3.12 However, the LGUs claimed that they have been assessing the
performance of the contractors using the following indicators:

Valid complaints acted upon by the contractors (Quezon, Pasay and


Manila Cities);

45

SOUND MANAGEMENT AND MONITORING MECHANISMS

Fielding of the minimum number of trucks and other equipment


required per area of coverage or minimum number of trips made
including required number of personnel;

Mopping-up operations conducted and collection of solid wastes


thrown by late throwers (Cities of Quezon, Pasig and Manila);

Fielding of the required number of street sweepers (Cities of Quezon


and Manila);

Collection of minimum volume of solid wastes as provided per area


of assignment on a regular basis (Cities of Quezon, Pasay, Caloocan
and Makati);

Conduct of information dissemination (Quezon City);

Manpower checklist:
a.
b.
c.
d.

sufficient number of personnel; (Pasay and Quezon Cities)


capability to maintain and operate dumptrucks; (Pasay)
availability of personnel in emergency related cases such as
additional collection and disposal;(Pasay)
availability of gadgets such as broomsticks, etc. (Pasay, Makati
and Quezon Cities)

Prompt action on calls for delivery of public service (Pasay);

Interrelationship with Government agencies (Pasay):


a.
b.
c.

eagerness to coordinate with the City SWMO;


willingness to attend to the needs and requests of each Barangay;
initiative to coordinate with MMDA for updated rules/procedures
and policies on legally accepted collection method and disposal.

3.3.13 These factors are valid bases of assessing contractors performance.


However, as these information were not included in the monitoring
reports, the LGUs do not have a valid and concrete basis of measuring
contractors performance based on these factors. Besides, the LGUs
have not established or set parameters to measure contractors
efficiency. There is a need to set parameters as to the number of times
or instances contractors failure could be considered within a
reasonable limit such as:

No. of valid complaints not acted upon within a certain period;

46

SOUND MANAGEMENT AND MONITORING MECHANISMS

No. of times the contractor failed to collect within the scheduled time
set;
No. of times the contractors failed to field the minimum number of
trucks and collect the minimum volume of solid wastes within a
certain period;
No. of times the mopping operation was not conducted and solid
wastes including wastes due to late throwers were not collected;
No. of trucks/ times not complying with the required masks and
gadgets and number of personnel;
No. of incidence of uncollected solid wastes as monitored by the
LGUs and complaints by the residents;
The quantity and quality of information dissemination conducted.
No. of times the contractor failed to observe the proper collection
method.

3.3.14 The team also noted that LGUs have not established monitoring
strategies to ensure that the contractors were performing as required
such as:

The list of major activities of the contractors that should be monitored


and strategies for each activity;
Representative percentage of each activity to be monitored to arrive at
a valid conclusion;
Monitoring reports to be rendered which should include the items to
be reported;
The types and magnitude of information dissemination that should be
undertaken by the contractors;
Records to be maintained.

3.3.15 Because LGUs do not have adequate indicators to measure


contractors performance, the performance of the contractors were not
efficiently and effectively monitored and assessed. As a result, the
LGUs were not able to institute measures to improve their
performance. The dissatisfaction of constituents to SWM operation
was manifested in the following results of the survey administered by
the team:

collection of solid wastes not undertaken regularly;


information dissemination on proper SWM not adequate;
complaints on uncollected solid wastes not acted upon immediately;
open trucks were used in collection;
streets not cleared of clutters/litters.

47

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response

Teams Rejoinder

Response provided by the City


Administrator, Pasay:
The alleged records, which were
thrown away as indicated among
other audit observation were reports
of monitoring personnel whose need
for such records were deemed
temporary unofficial and does not
require filing and does not form part
of a systematized body of
procedure.
The regular weekly
meeting of the SWMO monitoring
teams is deemed sufficient in its
ability to handle garbage collection
situation per sector efficiently.

Monitoring reports should be kept in


file since this should be used as a basis
in
evaluating/assessing
the
contractors performance.
The
monitoring team would not be able to
recall all incidences of contractors
failures or satisfactory performance.
These should therefore not be
considered as unofficial reports.

Contractors are considered efficient


due to its capability to collect
household and street garbage
regularly and to promptly collect
illegally dumped garbage by late
throwers upon request from SWMO
or upon receipt of reports from the
SWMO monitoring team.

The
contractors
efficiency
is
questionable considering the results of
survey undertaken by the team and the
absence of documented monitoring
activities that would prove that
contractors performance is actually
being monitored and found at least,
satisfactory.

Response provided by the City


Mayor, Pasig:
The contents of garbage contracts as
to compliance by contractors are
being enforced through monitoring
by
Monitoring
Officers.
Corresponding
penalties
or
deductions are being implemented
by the Office of the City
Accountant and Office of the Mayor
every monthly billing of contractors.

Any penalties that were deducted from


the contractors claim manifest the
contractors inefficiency. The City
should therefore not be contented on
penalizing
the
contractors
by
deducting a certain amount from their
claim. Contractors non-performance
or breach of contract translates into
uncollected solid wastes that would
reflect in the LGUs performance and

48

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response

Teams Rejoinder
would pose health hazards to the
constituents and bad publicity for the
City. SWM contracts should specify
acceptable or tolerable limits for
breach of contracts and specific
sanctions to erring contractors.

In order to prevent improper


disposal of garbage and avoid
individuals,
associations
or
corporations to throw garbage
anytime that they deem it
convenient,
the
Sangguniang
Panlunsod enacted last September
11, 2002, two (2) Ordinances, the
gists of which are as follows:

This is a good move on the part of the


City Government to instill community
participation and discipline.

- Ordinance No. 29, prescribed


time for throwing garbage
(9:00 p.m. to 5:00 a.m.) with
penalties
imposed
for
violators.
- Ordinance No. 30, penalizing
contractors who failed to field
garbage trucks on time and
who likewise failed to
maintain their AOR clean
from 5:01 a.m. to 9:00 p.m.
daily.
The Clean and Green unit and ESC
Office of the City Mayor will
coordinate with the barangays for
the removal of garbage steel
containers and concrete storage
which unfortunately encouraged
unmanageable throwing of garbage.

49

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response

Teams Rejoinder

Response provided by the City


Mayor, Manila:
We beg to disagree and point out
that our present monitoring system
works well for the City. We have to
admit though that adjustments are
continuously being made to improve
the system. In fact, using the same
monitoring system, Manila was
judged as one of the cleanest cities
in Metro Manila as per Metro
Manila Development Authority
publications dated October 10, 1995
as published in the Manila Bulletin.
And again in October 1, 1996 as
published in the Manila Standard as
per MMDA report.

The deficiencies in the monitoring


system are discussed in the report. The
needs of the City have changed over
time considering the changes in some
factors such as population growth and
increase in commercial activities.
While some of their policies, systems
and procedures worked before, these
need enhancement to effectively work
under the current set up. As discussed
in the report, the present system is
found inadequate to address the Citys
objective. The Metro Section of the
September 5, 2002 issue of the
Philippine Star showed a picture of a
man scavenging solid wastes at the
seaside of Roxas Boulevard. This
reflects the deficiencies in monitoring
system. The Daily Monitoring Report
could not even be used as a basis in
assessing the contractors performance
due to its limited information.

The
DPS
has
performance
measurements as indicated by our
monitoring teams who do ocular
inspections and accomplish daily
monitoring reports. Performance is
measured by the daily monitoring
report of our monitoring team.
Based on this, the Department
Heads of DPS prepares his
certification.

The Daily Monitoring Reports for all


Districts from September 2 to 7, 2002
reflect uncollected solid wastes in
several areas/locations. In most cases,
there were no reported actions by the
contractor, rather, it is the City itself
that acts on such complaints. Despite
reported uncollected wastes, the OICHead, DPS, issue certification to the
effect that the contractor, Leonel
Waste Management Corporation, had
satisfactorily cleaned the six districts.
The certification entitles the contractor
to full payment of the monthly

50

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response

Teams Rejoinder
contracted amount.

Response provided by the Mayor,


Quezon City:
The City is aware of this deficiency.
That is why it also hired additional
monitors effective October 2, 2002.
It should be mentioned, however,
that the City has a built-in
monitoring system linked closely
with the Barangay Council, the
Homeowners Association, and even
Peoples organizations. Moreover,
during the time when the EPWMD
had inadequate number of monitors,
the City directed the BOC and CRO
personnel to provide support and
help in the monitoring of garbage
collection.

The designation of additional monitors


and procurement of additional
facilities would definitely enhance the
monitoring activities of the City.
However, this is just one of the
recommended measures to ensure
compliance by contractors with the
provisions of the contracts. Equally
important are the setting of parameters
to assess the efficiency of contractors,
establishing monitoring strategies to
ensure contractors compliance with
the contract and improving the
reporting system, among others.

Response provided by the Secretary


to the Mayor, Caloocan City:
The City believes that, considering
the very limited budgetary resources
it has, the policies and procedures it
had placed in monitoring the
performance of WMCSs is adequate
enough.
We may not have
sufficient documents to prove the
efficiency of our service contractors
as this would entail additional
expenses for the City, but a tour in
the City on any given day will prove
that said contractors have been
efficient.

The Daily Monitoring Reports


prepared by the Task Force 9003
reflect uncollected solid wastes which
were not acted upon. This observation
was confirmed by the residents in the
survey conducted by the team to assess
the performance of SWM contractors.
Of the 160 constituents of 15
barangays surveyed by the team,101 or
63% complained of non-collection of
waste; 113 or 71% replied that there
were no monitors to check if solid
wastes is collected. Records of the
ESS also showed that in Barangay 177

51

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response

Teams Rejoinder
being serviced by Southport Trading
and
Warehouse
Services,
601
complaints of uncollected solid wastes
were recorded from January to August
2002. There were however no
recorded actions on these complaints.
The mounds of solid wastes which
were left uncollected was also noted at
the old Zabarte Road within the
jurisdiction of the City of Caloocan.

Reports of uncollected garbage are


immediately forwarded to respective
area service contractor by phone. A
standby garbage truck is dispatched
depending on the volume. If the
volume is very minimal, the garbage
is picked up the following day at the
regular schedule of collection of
garbage. The City fully agrees with
the observations that Barangay
residents perception on waste
management service is a tool in
measuring
the
programs
performance. On this point, the City
is inclined to conduct regular bimonthly survey to determine the
perception of the community
regarding
waste
collections
delivered by WMSCs.

Sample reports of the Task Force 9003


for the month of July 2002 reflect a
number of monitored uncollected solid
wastes which remained unacted by the
contractors. This only reflects the
deficiencies in the monitoring system.
Nevertheless, the team appreciates the
plan of the City Government to
conduct regular survey to determine
the communitys perception on the
Citys SWM operation.

For this year, there will be review of


the present set up regarding
contractors
performance,
evaluation of the formula or method
in determining the daily garbage
generation, review of barangay
development plan regarding waste
management, residents perception
data on the collection of garbage,

The City's policy of recording


complaints is a step toward the
establishment of an effective feedback
mechanism. As observed by the team,
only complaints received during office
hours were recorded in the logbook.
Moreover, actions taken on such
complaints were not recorded and
monitored. The purpose therefore of

52

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response

Teams Rejoinder

and the review and setting up of the


revised standards to measure
performance, and review of its
present capacity regarding the
imposition of penalties to violators.

recording complaints which is to


institute corrective actions was not
served.

The City will take into consideration


the observations and comments of
the team in the future for the
purpose of enhancing its monitoring
system.

The team appreciates the actions to be


taken by the City to address this
problem.

Response provided by ESC Head


Mandaluyong City:
The SWM Program of the City of
Mandaluyong aims to combat health
and sanitation problems brought
about by piles of solid waste along
streets, clogged canals and sewers,
waste from occurrence of disasters,
and others. To achieve the purpose
of the program, policies and
procedures were formulated towards
the reduction of wastes generated at
source and the improvement of
collection efficiency for all sources
of solid waste, among others.

The team acknowledge the efforts


being undertaken by the City to
improve SWM operation and attain its
objectives. However, the City could
not ensure the validity of the reported
sources of solid wastes unless the
contractor's performance is monitored.
An assurance from residents or any
barangay official on the collection
undertaken in their respective area
would validate the report of the
contractor.

It is not possible that some


waste/garbage collected originated
from illegitimate or doubtful source.

As this is not monitored and there is


no proof that all solid wastes paid by
the City were collected within the
Citys premises, the possibility of
illegitimate or doubtful source could
not be set aside.

The suggestion that at least two (2)


residents for each route to sign the

This procedure is being practiced in


Marikina City and not a single resident

53

SOUND MANAGEMENT AND MONITORING MECHANISMS

Managements Response
trip tickets attesting that garbage
was actually collected may be
possible but not feasible. It may
become the cause of corruption in
that level. Hence, we consider the
recommendation
not
practical.
However, we expect complaints
from residents if garbage were not
collected in their area in just two (2)
or three (3) days.

Teams Rejoinder
complained that this is a source of
corruption. It is therefore suggested
that this aspect of monitoring be
properly considered and studied to
ensure that solid wastes are collected
from the designated sources within the
City's premises.

RECOMMENDATIONS
The LGUs should consider:
1.

Establishing policies and procedures on monitoring


including setting parameters/indicators to assess the
performance of contractors. These indicators should be
clearly stated in the contract and closely monitored to
ensure delivery of satisfactory services;

2.

Identifying the major activities to be monitored and


establishing strategies to monitor each activity;

3.

Establishing a representative percentage for each activity


to be monitored and assigning monitors in specific areas
that they could possibly cover within the day to ensure that
the reports could be used as a valid basis in assessing the
performance of contractors;

4.

Defining the activities of the monitors, the items to be


reported and the records to be maintained;

5.

Establishing
feedback
mechanism
where
constituents/residents could report their complaints on the
54

SOUND MANAGEMENT AND MONITORING MECHANISMS

failure and/or satisfactory performance of the contractors


such as complaint hotlines or regular surveys to determine
public satisfaction on the performance of the contractors.
6.

Monitoring the actions taken on valid complaints received


from the residents by maintaining a logbook indicating the
time the complaint was received, the complaining party
and the contact number, the specific place being
complained of, the nature of the complaint, the person
receiving the complaint, the time the said complaint was
relayed to the contractor and the action taken by the
contractor. The actions taken by the contractor can be
established by requiring the complaining party to inform
the City on the actions taken by the contractor and the
specific time such actions were taken or by sending a
monitor to validate the contractors action;

7.

Establishing the targeted residents/constituents that


should be covered in the information dissemination
campaign. The type and quantity of paraphernalia to be
used and the specific place where these should be posted
or hanged;

55

CHAPTER 4

Effective Quality Assurance Processes

56

EFFECTIVE QUALITY ASSURANCE PROCESSES

INTRODUCTION
3.4.1 Quality assurance implies a desired quality level in the implementation of
one's operation. To ensure a quality SWM operation, LGUs should
establish and support adequate systems of quality assurance. These
comprise policies and procedures designed to provide LGUs with
adequate assurance that the SWM Plan meet the requirements/standards
set. A quality assurance should provide that:

SWM policies and procedures are properly in place;


Accountability for SWM are clearly identified;
Risks to the efficient and effective SWM are identified and addressed;
The service provided by contractors are satisfactory;
The benefits to the stakeholders are not compromised; and
There is adequate monitoring and review of quality assurance.

3.4.2

The monitoring and review of quality assurance is essential to ascertain


adherence to standards and specified processes/procedures in SWM
operation. It is in this aspect where a committee/body is tasked for the
purpose of emphasizing the strength and weaknesses in the present
SWM operations and identifying improved practices which may be
introduced as better practice in SWM.

3.4.3

Under RA 9003, each LGU is required to create SWM Board to ensure


the efficient and effective implementation of SWM operation.

3.4.4

The audit noted that of the ten LGUs audited, only 2 have so far created
an SWM Board. In view of the absence of an oversight body to develop
mechanics and guidelines, monitor/oversee and review adherence to
existing regulations in the implementation of SWM operations, lapses
in the operations were not given particular attention.

OBSERVATION
Eight of the 10 LGUs audited have yet to create SWM Board
mandated under RA 9003 to develop SWM Plan and oversee the
implementation of SWM operations. The oversight of the quality
assurance process is not also a specific responsibility of any offices
57

EFFECTIVE QUALITY ASSURANCE PROCESSES

within the LGUs. On the other hand, the SWMB of the 2 LGUs
were not yet functioning as intended. As a result, there were
practices required under R.A. 9003 which were not followed and
lapses in the operations were not detected and corrected.
3.4.5

Under RA 7160, LGUs are responsible for collection of solid wastes


within their jurisdiction and transfer of these wastes to a designated
place. The LGUs are also primarily responsible for the implementation
and enforcement of the provisions of RA 9003.

3.4.6

Section 12 of RA 9003 requires component cities and municipalities


within Metropolitan Manila to form SWM Board (SWMB) with the
following responsibilities, among others:

developing the City or Municipal SWM Plan (SWMP);


monitoring and overseeing its implementation;
coordinating the efforts of
component barangays in the
accomplishment of the SWMP;
adopting measures to promote and ensure the viability and effective
implementation of SWM programs in the component barangays;
developing the specific
mechanics and guidelines for the
implementation of the City or Municipal SWM Plan; and
reviewing every two (2) years or as the need arises, the City or
Municipal SWM Plan for the purpose of ensuring its sustainability,
viability , effectiveness and relevance in relation to local and
international developments in the field of SWM.

The Board shall be composed of the City or Municipal Mayor as head


with the following as members:

One (1) representative of the Sangguniang Panlungsod or


Sangguniang Bayan, preferably chairperson of either the Committee
on Environment or Health, who will be designated by the presiding
officer;
President of the Association of Barangay Councils in the City or
Municipality;
Chairperson of the Sangguniang Kabataan Frederation;
A representative from NGOs whose principal purpose is to promote
recycling and the protection of air and water quality;
A representative from the recycling industry;
A representative from the manufacturing or packaging industry; and

58

EFFECTIVE QUALITY ASSURANCE PROCESSES

A representative of each concerned government agency possessing


relevant technical and marketing expertise as may be determined by
the board.

3.4.7

The team noted that as of audit date, of the ten LGUs included in the
audit, only Caloocan and Malabon Cities have created SWMB
pursuant to R.A. 9003. Unfortunately, these SWMBs are not yet
functioning in accordance with the provisions of RA 9003.

3.4.8

The oversight of the quality assurance process is also not a specific


responsibility of any of the offices within the LGUs. As such, there
were requirements under R.A. 9003 which were not complied and
lapses in the operations were not detected and corrected. Nine (9)
LGUs have however managed to prepare their waste management plans
and strategies which were incorporated either in the Medium Term
Development Plan (MTDP) or Annual Investment Plan (AIP).
However, the plans were not in accordance with the requirements
prescribed under the Act and were not yet submitted to the Metro
Manilas Regional SWMB for evaluation and approval. The individual
plans were supposed to form part of the Provincial SWM Plan which
the MMDA is tasked to monitor.

3.4.9

The absence of the Board also resulted in lack of coordination between


Municipalities/Cities and their component barangays. Some barangays
have already purchased their mini dump trucks for collection purposes
and yet this was not considered by the Cities/Municipalities in their
contracting activities. The contracted services should have been limited
to collection of solid wastes in a transfer area where the barangay
trucks would temporarily deposit their collection. This would reduce
the presently contracted cost of collecting solid wastes from house to
house.

3.4.10 The absence of the SWMB also contributed to the failure of some
LGUs to strictly implement other activities required under RA 9003
such as:

Mandatory Segregation of Solid Wastes;


Requirements in the installation of facility for Segregation and
Storage of Solid Waste;
Requirements for Recycling program;
Issuance and enforcement of ordinance to effectively implement
collection system;
Education and public information;

59

EFFECTIVE QUALITY ASSURANCE PROCESSES

Resource requirements and funding;


Composting.

3.4.11 Nevertheless, the following Cities were able to partially implement RA


9003:

Marikina City
-

Valenzuela City
-

The City is practicing waste segregation

The City was able to establish an Ecological Learning Center


with recycling and composting facilities

Malabon City
-

The City is implementing waste segregation and composting in at


least three barangays.

Managements Response
Response provided by
Makati City:

Teams Rejoinder

Vice-Mayor,

Our R.A. 9003 Action Plan will show


that we have taken the initial steps in
the implementation of Republic Act
9003 and in the preparation of a
Comprehensive Ecological Solid
Waste Management Master Plan for
Makati City. We had meetings with
the Association of Barangay Captains
for the conduct of Action Planning
Workshops and Capacity Building
Seminar. At the regional level, we had
regularly attended meetings initiated
by the MMDA in order that we may
be properly guided on policies and
programs relative to proper waste
management. The SWMD is also
currently preparing a City Solid Waste

The team takes cognizance of the


actions being taken by the City in the
implementation of R. A. 9003. The
creation of SWMB which was
required under the said Act would
greatly help in ensuring the quality of
the services now being rendered by
the City and maintaining its status of
being the cleanest City.

60

EFFECTIVE QUALITY ASSURANCE PROCESSES

Managements Response

Teams Rejoinder

Management Profile that is required


by RA 9003. The City has a Waste
Segregation Program. We had piloted
a number of streets and barangays for
the waste segregation scheme.
However,
the
program
was
temporarily stopped in 2001 due to the
garbage crisis that was brought about
by the closure of the San Mateo
Landfill.
Currently,
the
implementation of the segregation
program was deferred for study in
order to conform with the provisions
of RA 9003 and the Unified Scheme
of MMDA.
In four (4) years, 1995, 1996, 1999
and 2000, we were the cleanest and
greenest in the whole Metro Manila. In
1997 and 1998, we were second
placers in Metro Manila. And
speaking of awards, in 1998, our City
has
garnered
the
BEST
GOVERNMENT
INFORMATION
AWARD with its program entitled
"Information,
Education
and
Communication Campaign Program"
which is specifically in the area of
Solid Waste Management. This
program remains to be an essential
component of our SWM to date.

Response provided
Administrator, Pasay:

by

City

Pasay City's SWMO, being newly


born, has accomplished more than is
expected. However, it admits that with
the pressures of RA 9003, it has more

The team recognized the actions


being taken by the Citys SWMO in
the implementation of R. A. 9003.
The creation of SWMB as required

61

EFFECTIVE QUALITY ASSURANCE PROCESSES

Managements Response

Teams Rejoinder

growing to do. The City has drafted its


SWM plan based on RA 9003 but
admits that resources and conditions
are not favorable to sustain its
implementation. However, it shall be
prioritized in CY 2003.

under the RA would greatly help the


SWMO in planning and coordinating
with NSWMC for an improved
performance.

Response provided by the City Mayor,


Quezon City
Although the City has conducted
thorough dissemination of RA 9003
and all barangays are already aware of
this law, they also have a hard time
implementing the provisions. As the
City has realized it, there is a big gap
between knowledge and practice. This
is also the same problem other LGUs
are encountering at the moment. The
City is now trying to bridge that gap
with stronger enforcement by next
year.

The creation of SWMB would be a


great start in the implementation of
RA 9003 since the Board will play a
great role in overseeing the
implementation of the Act.

Response provided by the Secretary to


the Mayor, Caloocan City:
The City is already in the process of
developing its 10-year solid waste
management plan in accordance with
Section 16 and 17 of Republic Act No.
9003. In fact, the City is currently
pursuing and/or implementing basic
policies and strategies thereon,
particularly on waste segregation,
recycling, collection, information
campaign, etc. aimed at reducing solid
waste collection and disposal. The
results of these activities are being

The team appreciates the actions


being taken by the City to expedite
the development of the SWM Plan
and other activities required under
RA 9003.

62

EFFECTIVE QUALITY ASSURANCE PROCESSES

Managements Response

Teams Rejoinder

studied and evaluated and shall be


used as basis in the preparation of the
10-year solid waste management plan
of the city and the component
barangays.

RECOMMENDATION
The LGUs should consider creating and or reactivating the SWM
Board as required under R.A. 9003 to ensure quality implementation of
SWM programs.

63

CHAPTER 5

Cost Measures

64

COST MEASURES

INTRODUCTION
3.5

Of the ten Cities audited, 7 were contracting the services of solid


wastes haulers/contractors for the
collection, hauling, disposal,
cleaning and information and education campaign. The 3 others
managed their solid wastes by administration.

3.5.1

For an efficient and effective implementation of SWM activities, the


LGUs, except for Mandaluyong City, shifted from per trip basis to
Package deal/Clean-up scheme.

3.5.2

The Package deal/Clean-up scheme is a simplified system that tends


to reduce and control the cost of collection, while ensuring that all solid
wastes in a particular area is collected. The collection cost is fixed per
month based on the estimated solid wastes to be generated during the
period. Under the scheme, the contractor is required to field sufficient
number of trucks and collection trips to be able to efficiently collect all
solid wastes generated within the service areas covered in the contract.
The LGUs computed their estimated solid wastes generation based on
household population and other factors that may affect the volume of
waste.

3.5.3

On the other hand, per trip is a collection system whereby the LGUs
monitor and record the volume of solid wastes collected and number of
trips made by the contractor to ensure that the LGU is paying for the
right volume and number of trips actually undertaken by the
contractor.

3.5.4

The team however, noted that while the contract cost under the package
deal scheme will greatly depend on the estimated solid wastes to be
generated, there was no established methodology in computing the
estimated solid wastes generated from different sources. At present, the
LGUs were using different factors in arriving at estimated solid wastes
generation per person per day which vary widely from LGU to LGU.
The factors used were also found to be higher than the factors
established under the JICA study. Solid wastes from other sources were
generally not included in the estimates as there were no factors
established yet. This raises concerns on the accuracy of the estimated
figures which were used as the basis of contracting cost. The
reasonableness of the contract cost is therefore doubtful.

65

COST MEASURES

3.5.5

Between February 1997 and February 1999, the Government of Japan,


in response to the request of the Government of the Philippines, owing
to the problems associated with escalating generation of solid wastes,
particularly in Metro Manila, dispatched a study team under the Japan
International Cooperation Agencys (JICA) development study
program . JICA was assisted by a team of consultants from the Pacific
Consultants International and Kokusai Co., Ltd. The MMDA acted as
the government counterpart agency on the JICA Study particularly in
coordinating with other governmental and non-governmental
organizations that may be involved in the study to ensure its smooth
implementation.

3.5.6

The objective of the study was to improve the SWM system in Metro
Manila through formulation of a practical and sustainable Master Plan
for SWM, with emphasis on upgrading the service level and expansion
of service coverage.

3.5.7

The study covered the 17 Cities and Municipalities in Metropolitan


Manila. The study team conducted a Waste Amount and Composition
Survey (WACS) in April and June 1997, in order to analyze the solid
waste stream during dry and rainy seasons where samples were
collected from 9 categories of generation sources in 3 sample areas
believed to represent Metro Manila, namely, Quezon, Makati and
Paranaque Cities.

3.5.8

The results from the WACS are tabulated below. The study also
showed that the future waste generation rate (WGR) in Metro Manila
showed a 2% annual increase.

Category

Unit

Quezon
Ctiy

Makati

Paraaque

Average

Escalated
Generation
in 2002

High Income
Middle
Income

kg/person/day

.465

.553

.483

.500

.552

kg/person/day

.449

.432

.472

.451

.498

Low Income

kg/person/day

.372

.340

.321

.344

.380

Restaurant

kg/shop/day

15.284

41.732

6.939

21.318

23.537

Other Shops

kg/shop/day

1.688

2.150

1.618

1.818

2.007

Institution

kg/person/day

Market
Street
Sweeping

kg/shop/day

River

.059

.101

.057

.072

.079

4.065

3.945

13.774

7.261

8.017

kg/km/day

10.560

19.010

2.535

10.702

11.816

kg/km/day

41.555

3.595

9.035

18.062

19.942

66

COST MEASURES

3.5.9

Another study was undertaken in 1989 by Consoer, Townsend and


Associates dealing, among others, on waste collection efficiency where
solid waste volume conversion from kilogram to cubic meter, of 300
kg./cubic meter was used.

OBSERVATIONS
1. The LGUs do not have an established methodology in computing
the estimates of solid wastes generation from all sources. At
present, they only have established factor for solid wastes from
household population. The factors however differ from LGU to
LGU which ranged from .500 to 1.27 kilogram per person daily.
These factors were comparatively higher than the factor
established under the JICA study which is .552 for 2002.
Considering that the estimated solid wastes generation is the
basis of the contract, the reasonableness of the contract cost is
doubtful. The cost derived by the team per cubic meter could not
also be compared across LGUs as different LGUs have
contracted different activities.
3.5.10 As a matter of policy, the 10 LGUs included in the audit prepare
estimates of solid wastes to be generated within a particular period. The
team noted that while solid wastes may come from different sources,
the LGUs estimates normally include only estimates from household
population. Their estimates were
computed using the following
formula:
Estimated daily
wastes generation = Population x
in cubic meter

Ave. wastes
generation/day/ x
person in kg.

conversion factor
from kg. to m3

Where:
Population
Ave. wastes
generation/day/
person

= household population

= .500 to 1.27 kg.

67

COST MEASURES

The conversion factors and average solid wastes generated per day per
person per LGU are as follows:

LGU
Mandaluyong
Caloocan
Makati
Malabon
Manila
Marikina
Pasig
Pasay
Quezon City
Valenzuela

Conversion
Factor

Average
solid wastes
generation per
person per day

300
300
300
200
200
-

.710
.550
Not indicated
.500
Not indicated
.550
1.27
.914
.585
Not indicated

The team was not provided by the Cities of Manila, Makati and
Valenzuela with the factors used in estimating solid wastes generation
for household population.
3.5.11 It may be noted that the LGUs do not have a standard factor in arriving
at their estimates which ranged from .500 to 1.27 kg per person per day.
They could not also provide the team with the basis for such factors.
The factor would greatly affect the computation of the total estimated
solid wastes generation. Since the estimate should be the basis of the
cost to be contracted, the reasonableness of the contracted cost is
therefore doubtful.
3.5.12 The team also noted that the factors applied by the LGUs vary greatly
with the factor established under the JICA study which was escalated to
be .552 kg. per person per day as of 2002. The resulting quantity
difference ranges from (1,825) to 844,807 cu. m. per LGU which will
greatly affect the total contracted amounts.

68

COST MEASURES

2002 Population

LGU

Caloocan
Makati
Malabon
Manila
Marikina
Pasig
Pasay
Quezon City
Valenzuela

NSO

Agency
Profile

(a)

(b)

1,335,665
515,442
352,407
1,681,040
476,575
637,384
328,159
2,237,580
561,889

1,426,089
435,059
352,407
1,609,097
427,037
528,291
328,159
2,247,720
561,890

Estimated based on
JICA standard
Conv.
Daily
Fac.
b x.552x
(kg to
c=
cu.m./
1,000)
(d)
(c)
3
3
3
3
3
3
5
5
3

2,362
720.46
584
4,441
705
875
906
6,204
930

Difference
Over (Under)

LGU Estimates

Annual
(d) x
365=
(e)

Ave.
daily
wastes
gen.
(f)

862,130
262,968
213,160
1,620,965
257,325
319,375
330,690
2,264,460
339,450

.550
NI
.500
NI
.550
1.27
.914
.585
NI

Daily b x
e x c=
(g)

Annual
G x 365=
(h)

Qty
h-e=
(i)

%
i/e

2,592*
3,035**
622.53
6,200**
700
2,460
1,500
7,889
910**

946,445
1,107,775
227,223
2,263,000
255,500
897,900
547,500
2,879,485
332,150

84,315
844,807
14,063
642,035
( 1,825 )
578,525
216,810
615,025
(7,300 )

10
320
7
40
181
66
27
-

*
Per City profile, however the contracted estimated volume was 1,040,520 cu. m.
**
Per agency records
NI - Not indicated

3.5.13 The big difference in the case of Quezon City was due to a 20%
allowance on the estimated household population of the City based on
agency profile.The City claimed that the daytime population is greater
than the nighttime population due to students and employees working
within the area but were not considered in the population profile as they
were not residents of the city.
3.5.14 The team however did not consider said increase as most City
residents are also working outside the City. Besides, non-resident
population would not generate the same volume of solid wastes as that
of the residents since they do not have household to maintain.
Moreover, solid wastes generated by daytime population are
concentrated on establishments where they are working or in
restaurants or shops, which has a different factor.
3.5.15 In the case of Caloocan City, the team was informed that the Citys
estimates also include wastes generated from commercial
establishments and markets. The density factors used were however not
provided to the team.
3.5.16 In Manila, Makati, Pasay, Valenzuela and Malabon Cities, the team
was not provided with the methodology of calculation hence the
differences could not be assessed.
3.5.17 On the other hand, the difference in Pasig is due to a very high factor
used on average daily wastes generation which is 1.27 kgs per person

69

COST MEASURES

and 26.67 kgs per shop in 2002. Pasig City is using the highest factors
for these items.
3.5.18 The conversion factor used by the LGUs also vary. The conversion of
300 cubic meters per kg. was used by Consoer Townsend and
Associates in their study of SWM in Metro Manila in 1989, while under
the JICA study, the conversion factor used was 200.
3.5.19 The team also noted that except for Pasig City, the LGUs estimates
include only solid wastes generated by household population and do not
include waste generated from markets, business establishments, street
sweeping or institutions.
While in some LGUs,
business
establishments take care of their own wastes by contracting out the
collection and disposal of their wastes to private contractors at their
own costs, the collection of solid wastes in the market places is the
responsibility of the LGUs.
3.5.20 The establishment of a standard factor is important considering that for
CY 2002, of the 10 LGUs included in the audit, 6 were contracting out
the collection, cleaning and disposal of solid wastes on a Package Deal
and Clean-up basis with contract costs based on the estimated solid
wastes generated using different factors.
3.5.21 Using their estimates, the LGUs entered into contracts with different
contractors. Analysis of the contracts revealed that the contracted
activities also differ from one agency to another. Hence, the derived
unit cost per cubic meter could not be compared accross LGUs as each
contract contains salient features not present in other contracts:
Contract
Period

Unit
Cost

Contract
Amount

Quezon

07/01/02
06/30/03

187.94

P 541,170,098.28

Pasig

01/01/02
06/30/02

144.61
to
220.20

175,708,494.00

Manila

01/01/02
12/31/02

218.06

493,468,800.00

City

Contract Feature
SW
collection,
cleaning(streetsweeping),
disposal and information and
education campaign including
provision
of
250
streetsweepers. Quezon City
has a designated dumpsite.
SW
collection,
and
disposal.The City has 10
contractors with different cost
per cubic meter.
SW
collection,
disposal,
information and education
campaign and provision of 250
streetsweepers, special cleanup project at least once a

70

COST MEASURES

Contract
Period

Unit
Cost

Contract
Amount

Pasay

01/01/02
12/31/02

424.33

232,320,000.00

Makati

01/01/02
12/31/02

369.20

408,992,957.64

Caloocan

01/01/02
12/31/02

261.38

247,380,000.00

Mandaluyong

01/01/02
12/31/02

City

340.93

67,607,050.00*

Contract Feature
month, shall be responsible for
cleaning all debris and solid
wastes in case of calamities
and monitoring of services
provided. The City has only
one (1) contractor.
SW collection and disposal
services. The City has 4
contractors.
SW collection and disposal
services. The City has 4
contrators.
SW collection and disposal
services. The City has 10
contractors.
Per Trip collection and
disposal

* January to June 2002

3.5.22 It can be gleaned from the table above that the contracts with the Cities
of Quezon and Manila involved provision for streetsweepers to
clean/sweep street litters, which is not present in the contracts of other
LGUs. Yet, the unit cost per cubic meter in these Cities were lower than
other LGUs without special features. On the other hand, Pasig City
unit cost per cubic meter is also comparatively lower than other LGUs.
However, the Citys estimate was about 199% over the teams
computation using the JICA standard. Makati City, with relatively high
unit cost compared to Pasig City, was also found to have estimates of
153% over the teams computation using the JICA standands.
3.5.23 Audit also disclosed that the costs per cubic meter in the LGUs
implementing SWM by administration of P 113.13 to P 256.88 were
relatively lower than the derived unit costs under contracts.

LGU
Marikina
Malabon
Valenzuela

Actual Annual
Garbage Collection
(in cu.m).
Jan.-Jun
2001
2002
248,497
190,844
433,749

129,543
122,129
301,143

EXPENSES

2001

Unit
cost

2002
(Jan. to June)

Unit
cost

P63,834,061.69
43,907,342.96
49,068,836.18

256.88
230.07
113.13

Not Available
P25,046,857.33
28,700,187.28

205.08
128.51

The above expenses include maintenance of equipment


(dump/compactor trucks, brooms, etc.) used by the cities in SWM
operations as well as maintenance and operation of their own controlled

71

COST MEASURES

dumpsites. It can be noted from the tabulation that Valenzuela has


incurred the lowest cost in SWM operation.
3.5.24 In terms of per capita cost (expenses over population) of SWM
operation of the 10 LGUs, it was computed by the team to be P51 to
P940 per year:

LGU/City

Mode

Population
(a)

Quezon
Pasig
Manila
Pasay
Makati
Caloocan
Mandaluyong
Marikina
Malabon
Valenzuela

By Contract
By Contract
By Contract
By Contract
By Contract
By Contract
By Contract
By Administration
By Administration
By Administration

2,247,720
528,291
1,609,097
328,159
435,039
1,426,089
285,424
427,037
352,407
561,890

vv
NA
*

2002
Expenses
(b)

Cost per
Capita
(b/a)

P541,170,098 .00 vv
175,708,494.00 vv
493,468,800.00 vv
232,320,000.00 vv
408,992,957.00 vv
247,380,000.00 vv
NA
NA
25,046,857.33*
28,700,182.28*

P241
333
307
708
940
173
71
51

Contract cost only


Not available
January - June

3.5.25 It can be noted from the above tabulation that of the seven (7) LGUs
undertaking SWM operation by contract, the cost per capita was highest
in Makati and Pasay. On the other hand, Valenzuela registered the
lowest cost per capita. Valenzuela is undertaking SWM operation by
administration. The expenses considered by the team in Makati and
Pasay Cities consist only of the total contract cost in the collection and
disposal of solid wastes. Other expenses relative to SWM operation
incurred by the said Cities were not included since the data were not
available.The expenses for other activities were lumped in the expenses
incurred by Environmental and Sanitation Department, where SWM
was one of the programs. The cost per capita in said Cities will even be
higher if incidental expenses incurred in SWM operation will be
considered in the computation
.
3.5.26 Due to absence of a standard factor in computing for the estimated
daily solid wastes generation, the LGUs were not able to adequately
manage the risk of ensuring the accuracy of the calculated solid wastes
generated.

72

COST MEASURES

2. The shifting of two (2) LGUs from Per Trip Basis to Package
Clean-up System enabled said LGUs to reduce government cost
by a total of P 271,789,746 in collection and disposal contracts
without sacrificing the quality of the services rendered by the
contractors and maintaining a clean environment.
3.5.27 In 2001, the Cities of Quezon and Makati contracted out the collection
of solid wastes on a per trip basis. In year 2002, these Cities shifted
from per trip basis to Package Clean-Up System where the
contractor was given the full responsibility to manage/administer and
directly carry out actual collection, cleaning and disposal of solid
wastes from various sources.
3.5.28 Comparison of the cost of garbage collection in 2001 incurred by
Quezon and Makati Cities and the cost of contracts entered into in year
2002 showed that the present system (Package Deal) enabled these
Cities to reduce the cost of collection and disposal of waste in the total
amount of P140,305,946.17 and P131,483,800.14 , respectively, or a
total of P 271,789,746.31 as tabulated below:
QUEZON CITY

MAKATI

Total cost incurred


on a per trip based on
contracts in 2001

P 681,476,044.45

P 540,476,757.78

P 1,221,952,802.23

Total contract cost of


package deal system
in 2002

541,170,098.28

408,992,957.64

950,163,055.92

P 140,305,946.17

P 131,483,800.14

P 271,789,746.31

Cost reduction

TOTAL

3.5.29 The present system tends to have favorable effect on the government
not only on account of reduced cost but in ensuring that all solid wastes
within the contracted area are collected by contractors regardless of
volume. This would also make monitoring activities easier as the City
could initially assess the performance of contractors by just going
around the City to see if all solid wastes have been collected.

73

COST MEASURES

Managements Response

Teams Rejoinder

Response provided by the City Vice


Mayor, Makati:
The JICA estimates are not accurate
basis for reviewing the soundness
of the existing system. First and
foremost, it should be pointed out
that the difference between actual
contract cost that the City of Makati
budgeted for waste disposal in the
amount of P408,992,957.14 and the
figure estimated by COA in the
amount
of
P96,512,570.00 is
caused by the different data used by
COA and the City of Makati. COA
used the estimated daily volume
provided by JICA in its study
conducted on 1997 for a two month
period (April and June) while the
City of Makati relied on its
historical data for the actual waste
collection for the year 2000.

The team could not particularly


determine the difference between the
teams estimates and the Citys
estimates as the team was not
provided by the City with its
methodology of calculation. The
JICAs standard factor set in 1997
was escalated on the basis of 2%
waste increase annually to be .552 kg
per household population in 2002.
The team also noted that considering
that at the time of audit, the
monitoring system of the City was
still inadequate, the reliability of the
alleged historical data is doubtful.

We submit that the figure used by


the City is more realistic, accurate
and reliable. This figure was based
of the waste generated for the year
2000 when the City was using the
per tripwaste collection system.
At that time, incoming trucks were
recorded,
inspected
before
deployment, again inspected by the
Barangay and SWMD volume
checker before year 2000, the actual
volume collected was 1,094,017
cubic meters and this translates to
2,997.306 cubic meters per day
(Please see Annex W)

As discussed above, the Citys


methodology in computation was not
established. Hence, its accuracy and
reliability could not be tested.
Besides, the reliability of historical
collection
data
in
2000
is
questionable since the City has yet to
establish adequate monitoring system
to measure contractors performance.

74

COST MEASURES

Managements Response

Teams Rejoinder

On the other hand, COA, while


using JICAs estimate on waste
generated by the City, actually
reduced this volume by limiting the
estimate to the daily garbage
collected only from households.
COA did not take into account the
waste generated by restaurants,
institutions,
markets,
street
sweeping and the like (e.g. soil
mounds, yardwaste, fire and
construction debris). Mixed waste
generated by these business
establishments are not confined at
the CBD alone but are also situated
in most of the other barangays of
Makati. It operates on the principle
that The higher the economic
activities, the more volume of
garbage generated , Makati being a
highly urbanized City.

The tabulation provided to the team


indicating the Citys estimates of
daily garbage generation was based
only on population. Hence, for
comparison purposes, the team
computed only solid waste generation
from household population. The team
could not prepare similar comparison
of wastes generation from other
sources due to lack of information for
calculation.

In coming up with its estimate of


daily garbage generation, the City
did not use as a basis the actual
volume of garbage collected for the
year 2001. This is because for the
year 2001, there was an abnormal
situation brought about by the
closure of dumpsites, which
translated into more garbage being
generated and collected within the
City. Now, had the City used its
data for 2001, then it would have
translated into a higher estimate of
daily garbage generated. Precisely,
the City reffered to the data for
2000, in order to come up with a
more accurate estimate of the
generated daily garbage.

As discussed above, the City, as of


audit date, has not yet established
monitoring procedures to ensure that
the data reported by contractors are
accurate.

75

COST MEASURES

Managements Response
We have presented our present
scheme in garbage collection and
disposal. We appreciate the efforts
of the team to evaluate our system
and welcome any suggestion for
further
enhancement
of
the
effectivity of the system for we are
all one in the pursuit of good
governance.

Teams Rejoinder
We appreciate the Citys concern and
desire to enhance their performance.

Response provided by the Mayor,


Pasig City:
The JICA study is based on the
number of population and fixed
stalls in public market. The study
did
not
include
business
establishments including private
markets, viajeros and ambulant
vendors in public market, super
malls,
high
rise
buildings,
government
institutions
and
factories. The NSO data is also not
accurate of its records for Pasig
City since the data failed to include
residents
and
commercial
establishments
in
disputed
boundary areas involving Pateros,
Taguig, Taytay, Cainta and
Marikina where garbage collection
services are extended by the City.

The JICA study includes factors for


solid
wastes
generated
from
restaurants, nightclubs, markets,
street sweepings, rivers and other
shops.
However,
the
teams
computation was based only on
number of household and shops as the
Citys own computation of estimated
solid wastes collection was also based
only on number of households and
shops/business establishments. The
team also considered the population
based on the agencys profile and not
on NSO records as can be seen from
the report. The population based on
NSOs records was however higher
than that of the agencys profile. The
difference in volume is primarily
based on very high factor used by the
City on the average generation per
person which is 1.27 kgs. and 26.67
kgs. per shop, as against the JICA
study of .552 kg. per person and
8.017 kgs. per shop for current year
2002. The City however could not
provide the team with the basis for

76

COST MEASURES

Managements Response

Teams Rejoinder
such factors.

Response provided by the Mayor,


Pasay City:
Contractors performance are not
being gauged by the volume of
garbage
collected
daily
or
periodically but rather by its
capability to rid the city garbage, be
it on regular hauling schedules or
by massive
clean-up operation
initiated by the SWM office.

While the contractors performance


was not being gauged on the volume
of solid wastes collected, the contract
cost was based on the estimated solid
wastes to be collected within the
contract period. The computation
therefore of estimated solid wastes
generation has a very great impact in
the determination of contract cost.

Response provided by the Mayor,


City of Manila:
The contract is package deal and
results are given emphasis rather
than volume. But we will study on
this suggestion.

Review of the bid documents show


that the bid price of the contractors
was primarily based on the volume of
solid wastes estimated by the City to
be generated within a particular
period. The estimate is being
forwarded to the bidders as basis of
their bids. It therefore follows that if
the Citys estimates is overstated, the
bid quotations submitted is likewise
overstated. Thus, it is important for
the City to establish a valid
methodology of calculating solid
wastes generation and to monitor
actual volume collected to confirm
the
accuracy or discrepancy in
calculation.

77

COST MEASURES

Managements Response

Teams Rejoinder

Response
provided
by
the
Secretary to the Mayor, Caloocan
City:
In 1997, instead of per trip at 14
cu.m., the per trip basis was
changed to package deal type
where the cost of services is based
on the volume of garbage estimated
to be collected in addition to other
services to be required from the
contractor.
The estimated daily generation of
2,528 cu.m. and 2,890 cu.m. for
CYs 2001 and 2002 were based on
the actual garbage generated during
the years 1994, 1995 and 1996 as
the basis of payment is based on the
number of trips at 14cu.m.
Thus, in the determination of the
volume of garbage to be collected
for purposes of package deal type
we used in 1994-1996 actual
garbage collected. This estimate is
increased equivalent to the average
increase during the year.

There was no assurance that the


volume of solid wastes collected
using the per trip scheme was
accurate considering that as of this
date,
the City has not yet
established adequate policies and
procedures
in
monitoring
contractor's performance. Since the
reported accomplishments then
were not validated, that could not
be used as a reliable basis in
calculating solid wastes generation.
The formulation therefore of a
standard factor in calculating solid
wastes generation per source based
on established criteria would be a
good move in ensuring the
reasonableness of the contract.

The volume cost ratio however,


has remained intact.
Based on the above, we believe that
the basis in establishing the cost of
service results to a fair and
reasonable contract price.
On the other hand, the City, through
the Committee on Award will study
the JICA proposition, particularly

78

COST MEASURES

Managements Response

Teams Rejoinder

the population and other variables


(dependent and independent) that
led to the conclusion at how
population affects wastes matter
production.

Response provided by the City


Mayor, Quezon City:
The factor for population growth
rate that was used by EPWMD in
projecting garbage generation was
1.92% which came from the City
Planning & Development Office.
NSOs factor is 1.78%. EPWMD
thought it more appropriate to use
the
CPDOs
growth
rate.
Furthermore, QCs land area is
more than 5 times bigger than that
of Manila. Such expanse requires
longer distances to travel resulting
in higher hauling costs. Likewise,
one of the problems encountered by
the City is the illegal dumping of
garbage coming from other LGUs.
This attributed to the bigger garbage
volume collected.

The team is not questioning the factor


for population growth rate. In the
team's computation, the team adopted
the household population provided by
the EPWMD. The difference was due
to the City's practice of increasing the
population by 20% and the difference
in the factor used by the City which is
.585 as compared with the factor
established under the JICA study of
.552.

The per capita generation of


garbage in 1997 was 0.53 kilo and
increasing at 2% per annum. This
would put per capita generation for
2002 at 0.585 kilo.

The City's basis in arriving at .53 in


1997 was not provided to the team.
The JICA Study in 1997 only showed
an average of .50 per person.

Moreover, the population of QC


fluctuates from nighttime to
daytime.
Hence,
nighttime
population
is
projected
at
2,247,720. However, this number

The daytime population are offset by


the Citys population that were not
working within the Citys premises.
These workers would not also be
generating the same amount of solid

79

COST MEASURES

Managements Response

Teams Rejoinder

increases by 20% during daytime


due to transients. These transients
could be the population either
working or transacting business in
the City.

wastes as that of the residents as they


do not have households to maintain.
Besides,
their
wastes
were
concentrated on the establishments,
institutions or places where they are
working or studying which have
different factors. Solid wastes
generated from these places were not
included in the City's estimates. In
most cases, these institutions are
responsible in disposing their
respective solid wastes.

Another reason, aside from


increased economic activity, that
accounts for the large volume of
garbage in the City is illegal
dumping from neighboring LGUs.
People from Caloocan and Marikina
have been apprehended previously
for dumping their garbage in the
City.

The team took notice of the reduction


in solid wastes collection costs and
agrees that the Citys performance on
the area is improving. However, in
order to achieve the Citys aim of
rendering quality services, the noted
deficiencies should be adequately
addressed.

Our primary consideration and


justification is that the City was
able to reduce the cost of garbage
collection by about P20 million
compared to the last six months of
the previous administration; yet,
the City is cleaner.

RECOMMENDATION
The LGUs should consider establishing standard factors from all
sources in arriving at their estimates of daily solid wastes generation to
provide a clear basis of contracting costs. The estimates should include
80

COST MEASURES

solid wastes to be generated from all sources such as public markets,


business establishments, and institutions intended to be serviced by the
LGUs.

81

Submitted in compliance with COA Assignment Order No. 2002-021


dated July 18, 2002.
ARNEL G. PASCUAL
Team Member

JUANITA S. CALIWAG
Team Member

ROSEMARIE R. MAGTAAN
Team Member

DEMETRIO A. ANCHETA, JR.


Team Member

GRACE T. DE CASTRO
Team Member

ROMEO B. TANJUTCO
Team Member

TERESA T. SANTIAGO
Team Member

RAQUEL C. GORGONIO
Team Member

EMELIE P. PESTANO
Team Member
GLORIA G. SILVERIO
Co-Team Leader

IDA M. OANES
Team Leader

EVELYN P. REYES
Team Supervisor
Reviewed by:
SUSAN P. GARCIA
OIC-Assistant Director
Approved by:

ILUMINADA M.V. FABROA


Director IV

82

PART IV

Annexes

83

Annex 1
Page 1 of 1

Solid wastes were seen along Tolentino St., Pasay City at 3:00 P.M.on October 2, 2002.

Annex 2
1 of 5 pages

Annex 2
2 of 5 pages

Annex 2
3of 5 pages

Annex 2
4 of 5 pages

Annex 2
5 of 5 pages