What can P7B buy? Millions
of pricey pens and modems

FOR THE younger generation steeped in the real-time world of text messaging and Twitter, the idea of having to wait several weeks for election results is downright silly. Yet even the youth may have a hard time taking in the P7.2-billion price tag of the Commission on Elections’ new poll automation system.

Some may argue that it’s still a small price to pay in exchange for a long-awaited break from a tradition of election-related controversy. A perennially cash-strapped country, however, will never go wrong in scrutinizing every bill a supplier hands over to it.

For instance, the 21-page financial proposal that TIM-Smartmatic submitted to the Comelec on May 4, 2009 allocates some P5 billion for hardware alone. A copy of the financial plan obtained by the PCIJ was signed bu Juan Villa for Smartmatic and Lamberto F. Lorenzo for TIM.

Apart from ballot-counting machines, the package also comes with high-powered servers for storing and canvassing votes, laptop computers and workstations for monitoring the data, printers for the paper trail, digital security cards, modems for data transmission, and even pens for marking ballots.

One would assume, of course, that the prices TIM-Smartmatic quoted are wholesale and would come out lower when compared to retail prices. But just out of curiosity, the PCIJ scoured through the hardware listings of the proposal for comparison with similar items being sold in retail outlets. And while PCIJ was unable to find machines that turned into robot-warriors to protect the earth from evil Decepticons, it did find several, well, peculiar listings, way higher than retail prices.

Modems. The system will require portable USB modems to be used to transmit data from precincts to canvassing servers. A total of 48,000 modems will be deployed in polling centers, while another 2,400 units will be used in canvassing centers.

The modems, which retail for less than P2,500 in the market, are listed by TIM-Smartmatic at two to three times that price. At more than 50,000 units, the discrepancy comes out to an apparent overpricing of more than P320 million.

Table 1. USB Modems with GPRS Capabilities (all amounts in Philippine pesos)

Quantity Total Price Unit Price Unit Price (Retail) Total Price (Retail) Difference
Canvassing units 2,400 12,876,718.16 5,365.30 2,500.00 6,000,000.00 6,876,718.16
Polling Centers 48,000 441,644,807.39 9,200.93 2,500.00 120,000,000.00 321,644,807.39

Memory Cards.Portable flash-based memory cards will be used heavily in the system for data storage and data security. More than 400,000 memory cards will be used for storing data, while another 5,000 flash cards will serve as digital security signature for canvassing.

The TIM-Smartmatic proposal lists memory cards at a unit price of almost three times the retail price of P350, while flash cards are listed at 50 percent more than the retail price of P500. At more than 400,000 units, there is a huge difference of P280 million between the items’ total price in the proposal and the comparable total in retail.

Table 2. Memory Cards (all amounts in Philippine pesos)

Quantity Total Price Unit Price Unit Price (Retail) Total Price (Retail) Difference
Removable storage 419,186.00 424,332,802.86 1,012.28 350.00 146,715,100.00 277,617,702.86
Digital signature 5,404.00 4,057,667.67 750.86 500.00 2,702,000.00 1,355,667.67

Pens. Perhaps the most curious item on the list involved the pens to be used for marking ballots. TIM-Smartmatic proposes to buy a total of four million pieces. In its proposal, the price of each pen comes out to about P20.25, which is more expensive than a simple ballpoint pen available at 24-hour convenience stores. The apparent overpricing: P66.2 million for four million pens.

Table 3. Pens (all amounts in Philippine pesos)

Quantity Total Price Unit Price Unit Price (Retail) Total Price (Retail) Difference
Ballot Marking Pens 4,341,340 87,892,867.16 20.25 5.00 21,706,700.00 66,186,167.16

To be fair, the TIM-Smartmatic proposal indicates that the pens come with a three-year full warranty, which at last check was something that neither 7-Eleven nor Mini-Stop offered. – PCIJ, 2009