The Trillion-Peso Black Hole: Senate Inquiry Unmasks the ‘SOP’ of Public Works Corruption, Kickbacks, and the Rise of Politician-Driven Projects

The halls of the Senate recently bore witness to a high-stakes, deeply frustrating, and ultimately explosive hearing that pulled back the curtain on the alleged systemic corruption within the Department of Public Works and Highways (DPWH). What began as an inquiry into localized project discrepancies quickly escalated into an investigation of a national scandal, revealing an intricate “Standard Operating Procedure” (SOP) that critics claim prioritizes political profits over genuine public necessity, potentially siphoning trillions of pesos from the national coffers. The intensity of the hearing, marked by fiery interrogations, judicial roadblocks, and the promise of a full public reckoning, has left the nation grappling with the immense scale of the problem.

The DOJ Roadblock: When Confidentiality Meets Public Inquiry
The hearing commenced with a palpable tension, largely centered on the challenge of extracting unvarnished truth from witnesses placed under the Department of Justice’s (DOJ) Witness Protection Program (WPP). Senator Marcoleta, a figure known for his rigorous questioning, immediately expressed his frustration. He argued that the committee’s ability to fully comprehend the scale and magnitude of the alleged corruption was being limited by legal constraints, preventing the witnesses from providing a “mental picture” of the massive funds involved.

A representative from the DOJ, the prosecutor general, firmly stood his ground, clarifying that the restrictions were not arbitrary but were mandated by Republic Act 6981, specifically Section 7, which guarantees confidentiality for proceedings and documents related to the WPP application. This legal shield, while essential for the protection of state witnesses, created a conundrum: how do you publicly investigate a trillion-peso corruption scheme when the key figures are legally bound to silence regarding the specifics?

The DOJ maintained that witnesses could still provide “mathematical computations” based on their affidavits to estimate the magnitude, a compromise that felt insufficient to the senators seeking a full, panoramic view of the alleged criminal enterprise. This legal tug-of-war underscored the profound difficulty in investigating high-level corruption: the need for public accountability often collides head-on with the judicial necessity of witness security and evidence integrity.

The Ghost in the Machine: The Mystery of “Zaldico”
The interrogation of Engineer Bernardo, a former DPWH official turned key witness, by Senator Marcoleta became one of the hearing’s most dramatic focal points. Marcoleta hammered on the recurring name in various testimonies: “Zaldico.” Witnesses like Alcantara and Gotesa had repeatedly linked Zaldico to vast sums of money and project transactions, with Alcantara’s projects alone reportedly reaching an astounding P5 billion. Yet, Engineer Bernardo’s account of Zaldico was suspiciously “meager.”

Bernardo, under intense scrutiny, insisted he had no personal knowledge of Zaldico’s transactions, claiming his own involvement was limited to following up on project implementation. He only knew Zaldico was the one discussing “project percentages” with others. This consistent narrative of distance, despite Zaldico’s pervasive mention across multiple testimonies, fueled the suspicion that Bernardo might be downplaying the role of a central figure. Marcoleta effectively painted Zaldico as the “ghost in the machine,” an invisible hand orchestrating billions in projects, whose true nature the committee was desperate to uncover.

Unmasking the Alleged P1 Trillion ‘Allocable’ Fund
The complexity of the corruption allegations deepened as the discussion shifted from individuals to the systemic manipulation of the national budget itself. Senator Marcoleta dropped a bombshell allegation, claiming the National Expenditure Program (NEP)—the budget proposal submitted by the President—is artificially inflated by what he termed “allocable” funds offered to legislators.

According to the figures presented by the Senator, these “allocable” additions could increase the NEP by at least P1 trillion. This figure, reportedly broken down into P350 billion for district representatives, P100 billion for leadership, P150 billion in unprogrammed funds, and a staggering P400 billion from bicameral adjustments, points to a potential system of budget insertion and realignment that bypasses the rigorous, need-based planning of government agencies.

Engineer Alcantara confirmed this aspect of the discussion, lending credibility to the alarming picture of a national budget process where a trillion-peso black hole could exist, driven by political allocation rather than regional development priorities. If true, this represents a fundamental breakdown of fiscal responsibility, turning infrastructure budgeting into a political bargaining chip.

Profit Over People: The Budget Prioritization Dilemma
The investigation then moved to the very core of public service: project prioritization. Senator Binay pressed the witnesses on the traditional budgeting process, which is supposed to be driven by local government unit (LGU) and Regional Development Council (RDC) lobbying. What she heard, however, was a seemingly reversed process where the DPWH and contractors might first suggest projects to lawmakers.

Witness Bernardo clarified that project requests come from a “mixed” universe: LGUs, RDCs, and yes, even contractors recommending projects to congressmen. Senator Binay then zeroed in on the most disturbing potential motivation: profitability. She highlighted the existence of mismatched infrastructure—flood control projects in non-flooding areas, or insufficient numbers of classrooms—and asked if the projects were chosen because they offered a higher profit margin, allegedly 25-40%, compared to lower-margin projects like building classrooms.

Bernardo denied that profit was a factor, attributing delays in classroom construction to complexity and funding issues. However, the revelation that the DPWH’s internal prioritization allocates 70% of “allocable” funds to national roads/bridges and flood control (O1 and O2) versus just 30% for Local Infrastructure Projects (LIPs) requested by LGUs, suggests a structural bias towards larger, more expensive infrastructure that may indeed yield greater financial benefits for those involved in the supply chain.

The Shift to “Proponent-Driven” Projects and “Fake Compliance”
A critical shift in the corruption landscape was highlighted by Engineer Alcantara, who noted that, particularly starting around 2023, projects originating from individual “proponents”—legislators or other high-ranking officials—have dramatically increased, often exceeding the value of projects approved through the standard, consultative RDC process. This signifies a move away from institutionalized planning towards a more individualized, politician-driven allocation system.

This problem was further detailed by Senator Gatchalian, who pointed out that less than 35% of RDC-endorsed projects actually make it into the national budget. This results in uncoordinated projects that LGUs are often completely unaware of, such as a major flood control project in Mindoro. The lack of coordination renders the infrastructure ineffective and often useless to the local communities it is meant to serve.

The most damning revelation came from Alcantara, who admitted that even when projects not on the LGU’s official “wish list” are approved by Provincial Development Councils (PDCs), this approval often happens as a mere “compliance” formality after the funds have already been released. Senator Gatchalian condemned this practice as “fake compliance,” a bureaucratic sleight of hand designed to provide a veneer of legality to projects driven by political mandates.

The 10% Kickback “SOP” and the Subpoena of a Key Figure
Senator Gatchalian concluded his questioning by focusing on the most damning detail in the affidavit of Engineer Bernardo: the alleged “SOP” of 10% kickbacks on projects. Gatchalian pointed to a specific statement where a former Secretary, Bonoan, allegedly requested a list of projects for the 2023 NEP amounting to P450 million, implying a corresponding P45 million kickback.

Bernardo confirmed the 10% figure for 2023 projects and admitted to personally handling the delivery of the kickbacks to Bonoan, sometimes directly and sometimes through his driver, but deferred to his lawyer for further details due to the WPP restrictions. This confirmation, even within the bounds of confidentiality, sent shockwaves through the hearing, confirming the existence of a high-level, organized system of project extortion.

Adding to the tension, Gatchalian moved to issue a conditional subpoena for Mr. Saldico (likely the same “Zaldico” previously mentioned). Saldico had failed to appear, submitting an outdated medical excuse letter dated January 2025, which was deemed insufficient to justify his absence. This move signals the Senate’s determination to bring all key figures before the committee and tear down the veil of secrecy.

The Path to Reform: Transparency and Accountability
Amidst the heavy allegations, the DPWH, represented by Usek Bisnar, made a commitment to reform. Bisnar announced the impending launch of a “Transparency Portal” within a month, a public platform that will display all government contracts from all districts. This move, lauded by the senators, is a crucial step towards public accountability, allowing citizens to monitor how their taxes are being spent.

More importantly, Bisnar committed to implementing significant reforms for the 2027 budget cycle. These reforms will focus on earlier preparation, setting clear parameters for projects, and ensuring genuine, mandatory coordination with LGUs and RDCs to prevent the continuation of the uncoordinated “fake compliance” projects that have plagued the system.

The DOJ, for its part, assured the committee that the investigation is progressing, with resolutions for five initial cases expected by mid-December. They stressed that while gathering corroborating evidence takes time, the DOJ will not sacrifice the quality of the case for the sake of expediency.

The Senate hearing has done more than just uncover corruption; it has exposed a fundamental flaw in the nation’s infrastructure spending mechanism. The challenge now lies not just in prosecuting the guilty, but in dismantling the “SOP”—the trillion-peso black hole that threatens to swallow the public trust and the nation’s development goals. The Filipino people await the promised reforms and the full justice that must follow the exposure of this shocking, politician-driven scandal.