PRESIDENT Benigno Aquino III increased up to 15 percent the advance payment that government agencies could give to suppliers of goods and materials purchased locally or from abroad.

Under Memorandum Order 15, which the President signed on May 9, government agencies are now allowed to make advance payments of up to 15 percent of the contract price provided that the transactions are secured by an irrevocable letter of credit or bank guarantee.

In a press statement issued Thursday, Executive Secretary Paquito Ochoa Jr. said the MO expanded the government procurement process in a bid to give equal opportunities to local suppliers while making sure tax coffers stay protected in case of a bad deal.

He said MO 15 amended a provision in the Implementing Rules and Regulations of Republic Act 9184 or the Government Procurement Reform Act, which allows a 10 percent advance payment for goods supplied from overseas.

RA 9184 provided a specific and limited exceptions to the rule against advance payment as prescribed in Section 88 of Presidential Decree No. 1445, or the Government Auditing Code.

The Code generally prohibits advance payment for services not yet rendered or for supplies and materials not yet delivered under any government contract unless prior approval of the President is obtained.    Efren Montano