Multi-year rule eased for routine service renewals

THE Department of Budget and Management (DBM) said government agencies no longer need to obtain a multi-year contractual authority (MYCA) to renew routine services repeatedly procured over the past three years.

In a Jan. 29 circular, Acting Budget Secretary Rolando U. Toledo said amendments to the MYCA rules now exempt “regular and recurring services” such as janitorial, security, and maintenance contracts.

It said the eased rules are aligned with Section 18 of Republic Act No. 12009, the National Government Procurement Act, and its implementing rules and regulations.

However, he noted that the DBM may still issue a MYCA for regular and recurring contracts under “justifiable circumstances” on case-by-case basis with sufficient justification.

Services covered by the MYCA exemption include janitorial, security, telecommunications, drinking water supply, office space rentals, venue and equipment leases, as well as fuel fleet cards, water distribution, and electricity services.

In addition, Mr. Toledo said agencies are required to conduct annual reviews to assess market conditions and renegotiate contract prices if costs fall.

Renewals must also be backed by performance evaluations to ensure service providers deliver satisfactorily, instead of undertaking another procurement process.

“NGAs (National Government agencies) shall also ensure that the annual funding requirements for regular and recurring services intended for renewal are appropriately reflected in their budget proposals to be submitted to DBM for the applicable fiscal years,” it said. — Aubrey Rose A. Inosante