Aquino highlights PPP woes

Aya Lowe
President Benigno Aquino III outlines in his State of the Nation Address on July 22 the problems that have plagued the Public-Private Partnership scheme, his flagship infrastructure program

PPP problems. President Aquino highlights the issues that faced the rolling out of PPP projects.

MANILA, Philippines – President Benigno Aquino III outlined in his State of the Nation Address Monday, July 22 the problems that have plagued the Public-Private Partnership (PPP) scheme, his flagship infrastructure program. 

“We are aware that many of our countrymen are excited to see the fruits of our Public Private Partnership projects. We likewise know that there are those who have grown impatient waiting for them. Let us put things into context. Back in 2010, when our administration came into office, we were left with only 6.5% of the programmable budget for the year, or just around P100 billion. Around 93.5% of the budget had already been allotted by my predecessor. This is precisely why we approached the private sector. We told them: we do not have the funds, let us partner with one another to build the necessary infrastructure,” he said. 

“Apart from this, we faced other difficulties when PPP began. The studies on which the projects were based were outdated; and the bureaucracy lacked the sufficient knowledge to implement them. Not to mention the public, who seemed to have lost confidence in the contracts government undertook,” he added. 

Aquino stressed that they have no plans of entering into questionable contracts just to bequeath problems to the next administration. Each project has to go through the correct process to ensure that taxpayers’ hard-earned money would be spent the right way, he said.

“As early as now, we are seeing the effects of the honest, transparent, and clear way we have been going about our PPP Projects. Before, even just the construction of a single airport already made headlines. Let us compare this to what we are seeing today: apart from the Laguindingan airport, which is already being utilized, we are upgrading and modernizing the Tacloban Airport, the Bicol International Airport, the New Bohol Airport, and the Mactan Airport all at the same time. The Daang Hari-NLEX link road is the fastest PPP project that has been awarded in any administration, with no shortcuts in the processes. All these, and all the other infrastructure projects that are being and will be constructed, will give rise to a society teeming with opportunity,” he said.

PPP projects

The Aquino administration unveiled the PPP program to investors in November 2010.

But the program has seen delays, with the government successfully bidding out only one or two of the 10 PPP projects initially identified for rollout.

In March, the Department of Transportation and Communications (DOTC) said that it was confident that most infrastructure projects valued close to P500 billion would be finished by the time Aquino’s term ends in 2016. In a speech read by DOTC undersecretary Catherine Gonzales in a thrift bank forum on March 20, Transportation secretary Joseph Emilio Abaya said that the DOTC was hastening the bidding process for infrastructure projects such as mass transport, airports, and seaports.

The ongoing PPP projects include:

1. Light rail transit line 1 (LRT-1) Cavite extension

This is Aquino administration’s biggest infrastructure project. It will connect Manila to Niog in Bacoor, Cavite in the south. The P60-billion project is scheduled for completion in 2016.

The Cavite extension will lengthen LRT-1 to 32.4 kilometers from 20.7 kilometers. The new southern endpoint of the line will be in Niog, Bacoor, Cavite instead of Baclaran. The extension project will cover the construction of 10 stations, 10.5 kilometers of viaduct, support beams, and 3 intermodal facilities.

The DOTC moved the deadline for the submission of pre-qualification documents for the LRT-1 extension project to July 30. 

2. LRT-2 extension project in Masinag, Pasig City

The LRT-2 project will extend the train line 4.14 kilometers eastward. It will terminate at the intersection of Marcos Highway and Sumulong highway instead of the existing Santolan Station.

Two stations will be added to the train line; one at Emerald Station in front of Robinson’s Place Metro East and the other at Masinag Junction in Antipolo City.

Abaya said the DOTC would bid out a P350-million consultancy contract for the civil works of the P9.7-billion project.

The project is scheduled for completion in 2015.

It was originally offered early this year, but the DOTC declared the bidding a failure when only one of the interested parties was able to meet the eligibility requirements of the Procurement Law.

3. Automated fare collection system for the LRT and the Metro Rail Transit (MRT)

This is a single-ticketing system for both the LRT and MRT.

In May, the DOTC pre-qualified 5 firms for the bidding of the P1.72-billion contract. The 5 firms that made the cut include the SM group, the AF Consortium (of Ayala and Pangilinan groups), Comworks Inc., E-Trans Solutions JV Inc. (Gotianun group), and Megawide Suyen-Eurolink. 

4. Various airports

The Aquino government’s major airport projects are the P17.5-billion Mactan-Cebu international airport expansion project, the rehabilitation of the Ninoy Aquino International Airport, the country’s main international gateway, the P4.3-billion Puerto Princesa Airport, P7.2-billion New Bohol (Panglao) International Airport, and the P1.1-billion Bicol International Airport.

The pre-qualified bidders for the Mactan airport have already been identified. These bidders have been given until July 15 to secure licenses for their construction contractors. 

5. Cebu bus rapid system project

The P10-billion project will be subject to the approval of the National Economic and Development Authority board within the first half of 2013.

6. Davao Sasa wharf improvement project in Mindanao

The DOTC will bid out the P4-billion project by the third quarter of 2013.

7. Intermodal stations in Metro Manila

The agency is pushing for a P7.4-billion project for the installation of intermodal stations in 3 locations around the National Capital Region that are meant to house provincial bus stations to decongest Metro Manila. – 


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