DOTr-LTO on License Plate Backlogs

Date posted on August 13, 2021
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13 August 2021


This is to clarify news reports quoting the 2020 Recommendations and Observations of the Commission on Audit (COA) particularly on the delivery of motor vehicle license plates.

To set the records straight, the contract in question, which is also stated clearly in the said COA report, was signed in 2014 between the then Department of Transportation and Communications (DOTC) and PPI-JKG Philippines, Inc. (PPI-JKG) for the delivery of 5.2 million pairs of Motor Vehicle (MV) plates and 9.9 million pieces of motorcycle plates, to supply the Land Transportation Office-Philippines (LTO) license plate requirements up to 2017.

Out of the deliverables, over 4 million pairs of MV plates and more than 7.2 million pieces of MC plates were undelivered.

In 2015, LTO’s payment to the PPI-JKG was disallowed by COA. Due to the COA disallowance, the payment to the supplier had to be suspended, which led to the stoppage of the production and delivery of the license plates from the LTO. Moreover, given the disallowance, the Supreme Court issued a temporary restraining order (TRO) on the distribution of the produced plates following a scrutiny by several lawmakers.

Solving backlog of issuances

When the Duterte administration took over in 2016, the government was confronted with the production and distribution backlog of millions of license plates.

DOTr granted the request of the LTO to acquire funds for a new contract for the production of license plates while waiting for the resolution on the COA disallowance of the previous contract.

Finally, in 2018, the Notice of Disallowance was lifted. In the same year, a new contract was awarded through public bidding to the Trojan Computer Forms Manufacturing Corp and JH Tonnjes E.A.S.T GmbH Joint Venture in time for the rehabilitation of the LTO Plate Making Plant.

Established in April 2018, the LTO Plate-Making Facility expedites the production of license plates that used to be outsourced. The facility has a high-tech plate-making robot with a capacity to produce 700 vehicle license plates in one hour or over 5,600 plates in an 8-hour shift per day.

It was also in 2018 that the DOTr-LTO started the release of motor vehicle plates registered in July 2016.

Currently, the DOTr, through the LTO, continues to prevent a recurrence of backlogs in the issuance of MV license plates and MC plates.

In its latest data, LTO recorded a total of 3,940,705 pairs of motor vehicle plates produced as of 10 August 2021.

For motorcycle plates, LTO’s latest record shows that as of 10 August 2021, a total of 6,019,150 pieces were produced by the agency from 2014. Of this number, 3,649,114 were produced from 2018 featuring the new design of MC plates.

Meanwhile, out of the 2,561,627 recorded backlog in replacement plates, a total of 2,438,421 pairs were already produced and distributed.

Budget Constraints

Allow us to futher clarify that the reported backlog in the production of plates is due in large part to the lack of budget of the LTO.

Please note that the LTO, just like any other national government agency, remits all its revenues collected to the National Treasury. Thus, it needs to request its budget allocation from the National Government to address all its programs and activities.

Below are records of budget requests made by the LTO from 2019-2021 for the supplies and materials necessary for the production of motorcycle amd lotor vehicle plates, as well as the corresponding amount of budget granted

Budget Requested for calendar year 2020: PhP1,869,274,000.00

Budget Granted: PhP696,747,000.00

Budget Requested for calendar year 2021: PhP3,574,755,000.00

Budget Allocated: PhP925,412,000.00
*Note that out of this allocation, only PhP 736,747,000.00 was actually released to the LTO, which would only be sufficient to supply the license plates for calendar year 2021, and not the backlog.

Accordingly, the LTO has already requested a budget allocation of PhP2,616,364,198.17 for calendar year 2022 so that the agency can meet the demand to produce 16 million license plates by 30 June 2022.

Therefore, the LTO wishes that it will be given the needed budget allotment to address the backlog in the motor vehicle license plates.

Furthermore, to expedite the production of plates, the LTO plans to outsource the production of plates for calendar years 2015, 2016, 2017, and 2022, in order to complete the projected 16 million plates by year 30 June 2022, instead of year 2024.

Rest assured that the current LTO administration is doing everything it can to address all the MC and MV plates backlogs.

We will not stop until all these affected license plates are produced and distributed to their rightful owners.

Source DOTr – LTO

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