August 20, 2025
MANILA – Sen. Sherwin Gatchalian sees possible “collusion” or “corruption” in the awarding of contracts for the government’s flood control projects to undercapitalized corporations.
At Tuesday’s Senate Blue Ribbon Committee hearing, Gatchalian noted that five of the 15 top firms that secured multi-billion contracts for the government’s flood control projects from 2022 – 2025 had a paid-up capital of less than P100 million.
QM Builders – P1.2 million paid-up capital; awarded P7.3 billion worth of flood control works
Centerways Construction and Development Corp. – P45 million paid-up capital; secured P5.1 billion worth of projects
Triple 8 Construction & Supply, Inc. – P90 million paid-up capital; won P3.9 billion worth of projects
Wawao Builders – P50 million paid-up capital; awarded P4.2 billion worth of projects
MG Samidan Construction – P250,000 paid-up capital; won P5 billion worth of projects
READ: Firm with P250,000 capital bags P5-B flood control deals
“My point is that the DPWH [Department of Public Works and Highways] has been awarding contracts to corporations that are undercapitalized based on the PCAB (Philippine Contractors Accreditation Board,” Gatchalian said in Filipino.
“We need to know exactly who approved or awarded the contract because we want to see accountability. That’s what we want to find out — because if the contractor is undercapitalized, then obviously the project will fail; they’ll be forced to cut corners.”
“So we want to go to the root cause of why these projects are being substandard. Because the contractors are not adequately capitalized, so they are also substandard,” he added
Citing the PCAB, Gatchalian said a winning contractor should have at least P1 billion net worth to bid in a project amounting to P450 million and above.
“In my opinion, there’s some form of, I think, collusion or some form of corruption in awarding the contracts to contractors who are not capitalized adequately. That’s the point I’m trying to make,” he said.
In the case of QM Builders, Gatchalian noted that the company not only had a P1.2 million paid-up capital but also reported zero income from 2015 to 2024, according to Securities and Exchange Commission (SEC) records.
“So how was it able to secure P7.3 billion when it never earned a single centavo and its capitalization is only P1.2 million?” Gatchalian asked.
Allan Quirante, owner of QM Builders, clarified that the SEC records presented during the hearing probably pertained to their hardware supply business, and not their construction business.
According to him, they started as a dealer of hardware construction materials in 1992, but ventured into the construction business in 2003.
“One name, two types of businesses,” he said in Filipino.
Quirante also said that at present, their Net Financial Contracting Capacity (NFCC) is P40 billion.
“That’s why the project we got doesn’t even amount to 10 percent of the projects we receive per year,” he said in Filipino.
The NFCC is computed by multiplying the company’s assets by 15, he added.
“For example, if you have P1 billion in the bank, you can qualify for P15 billion. If you have P2 billion in the bank, that means you can qualify for P30 billion — that’s the computation,” Quirante explained in Filipino.
“That’s why we, with our cash and assets totaling more than P2 billion, when multiplied by 15, can reach P40 billion. That’s why we are capable of contracting up to P40 billion,” he added.