THE DECENTRALIZATION POLICY of resigned Public Works and Highways Secretary Manuel Bonoan opened the floodgate of corruption, by weakening the oversight functions of central office leading to bid rigging and ghost flood control projects.
Former Supreme Court Justice Andres B. Reyes Jr., chair of the Independent Commission for Infrastructure, recommended to current DPWH Secretary Vince Dizon to reverse the decentralization policy of Bonoan contained in Department Order 195 (series of 2022) expanding procurement powers at the regional and district levels.
He noted that the policy created flaws and governance gaps that weakened oversight and enabled bid rigging and ghost projects at the district level.
Bonoan’s order raised the limit of authority (LOA) for civil-works awards to P150 million for district offices (from P100 million) and P400 million for regional offices (from P300 million), a decentralization meant to speed up implementation.
The ICI stressed that the relaxed thresholds paved the way for abuse — most visibly in Bulacan, where former district engineer Henry Alcantara and aide Brice Hernandez allegedly rigged bids and booked non-existent works worth billions of pesos with fly-by-night contractors including the Discaya Group, SYMS Construction, and Wawao.
“What was sold as efficiency made it easier for field offices to push through billion-peso ghost projects with minimal central review. The scheme has prompted graft charges and Anti-Money Laundering Council (AMLC) asset freezes,” ICI said.
RESTORE CONTROL
To restore controls, the ICI proposed halving the caps to P75 million for districts and P200 million for regions — a move that may slow procurement but tighten checks by reducing local discretion expanding central approval, and signaling a rollback of the Bonoan-era decentralization viewed as a key catalyst of the flood-control scandal, said a report from Business World.
By shifting more approvals from districts back to regional and central DPWH offices,vetting of large contracts will have to go through Manila-based scrutiny where audit and anti-graft oversight are stronger.
While procurement could slow and some bottlenecks may return, the trade-off is fewer opportunities for bid collusion and manipulation at the local level, with district engineers’ discretion sharply curtailed.
ICI’s prescription is a rebuke of the Bonoan-era decentralization that handed vast procurement power to districts. It also signals a renewed anti-corruption push from the government, aiming to rebuild checks and balances after flood-control abuses and overpriced or ghost projects surfaced across multiple DPWH field offices.
WARY U.S. INVESTORS
Corruption issues on government projects are dampening US investor interest in the country, reported Philippine Ambassador to the US Jose Manuel “Babe” Romualdez.
But Secretary Frederick Go, Special Assistant to the President for Investment and Economic Affairs, begged to disagree as he claimed the Philippines has not lost any investment pledges due to ongoing probes into corruption on flood control projects.
In a radio interview, Romualdez said around $100 billion to $150 billion in potential investments — including those linked to President Ferdinand Marcos, Jr.’s US engagements — may be at risk unless the corruption scandals are resolved.
“(Foreign investors) want to see that our justice system is efficient… These corruption scandals need to be resolved,” the envoy was quoted by Business World.
INVESTMENT REPORT
In its 2025 Investment Climate report, the US State department identified corruption as a major barrier to foreign investment in the Philippines. It noted that corruption is “a pervasive and long-standing problem in both the public and private sectors” in the country.
The Marcos administration is intensifying its anti-graft campaign following public outrage over fraudulent infrastructure projects involving lawmakers, public works officials and select contractors.
Marcos created the Independent Commission for Infrastructure (ICI) to investigate irregularities in flood control projects.
Go told a palace briefing that the President’s decisive actions demonstrate the government’s resolve to fight corruption and strengthen investor confidence.
“The swiftness and decisiveness of the President show the resolve of the government to clean up corruption, which is good for the economy and builds confidence,” he said, citing ICI’s creation and appointing former Justice Secretary Jesus Crispin Remulla to the Office of the Ombudsman “with gravitas” to lead the probe.
FUTURE-READY ECONOMY
Go said the administration’s proactive response to the corruption probe sends a clear signal that the Philippines is “building a future-ready economy anchored on trust and sustainable growth.”
He dismissed the corruption controversy as a “short-term issue,” which when resolved could yield long-term benefits by improving governance and ensuring more efficient public spending.
“This investigation will be good for the country in the long-term because it will address and correct the wrong practices,” he noted.
“The effect of this is that the budget, and we already see it now, will be more efficiently spent and allocated on more productive programs, which will benefit the country and our people,” he added.
Go said the business community, particularly foreign business chambers, has always flagged corruption and red tape as top concerns.
“This administration sees the fight against corruption and red tape as a core part of its economic strategy,” he said.
TRANSPARENCY RANKING
The Philippines ranked 114th out of 180 countries in Transparency International’s 2024 Corruption Perceptions Index, a position largely unchanged in recent years.
Josue Raphael J. Cortez, a diplomacy lecturer at De La Salle-College of St. Benilde’s School of Diplomacy and Governance, agreed with Romualdez’s remarks on corruption and investment as reflecting an accurate picture of how political stability influences foreign investor confidence.
“Romualdez’s statement is unlikely to harm Philippine-US relations, as such observations are widely recognized in discussions on foreign direct investment,” Cortez said.
He said this could encourage the US to support structural reforms and transparency measures that align with its democratic values.