House probe into alleged ‘lopsided’ LRT concession agreement sought

Mara Cepeda
House probe into alleged ‘lopsided’ LRT concession agreement sought
ACT-CIS Representative Eric Yap files the resolution just 3 days after President Rodrigo Duterte said he would check the LRT contract, which involves the Ayalas and business tycoon Manny Pangilinan

MANILA, Philippines – An administration-allied lawmaker is calling for a House investigation on the allegedly “lopsided” contract between the government and the Ayala-Pangilinan consortium Light Rail Manila Corporation (LRMC). 

Anti-Crime and Terrorism Community Involvement and Support (ACT-CIS) Representative Eric Yap filed House Resolution (HR) No. 647 on Monday, January 20, just 3 days after President Rodrigo Duterte said he would look into the contract of the Light Trail Transit (LRT) as he once again made threats against the Ayala family and business tycoon Manny Pangilinan.  

Without giving the specific amount, Yap said the LRMC’s gross revenue since 2015 “appears to be bigger than the Project concession fee, which may indicate an unjust and inequitable terms that may put the financial burden of the agreement to the government.”

“There must be a review of such existing government contracts with private firms to ensure that these are primarily advantageous to the Filipino people,” added the ACT-CIS congressman. 

The LRT 1 is jointly operated by the Light Rail Transit Authority and the LRMC, a consortium of 3 infrastructure companies: the Metro Pacific Light Rail Corporation, a subsidiary of the Pangilinan-led Metro Pacific Investments Corporation; AC Infrastructure Holdings Corporation, a subsidiary of the Ayala Corporation, and the Macquarie Infrastructure Holdings.  

The business tycoons behind LRMC – the Ayalas and Pangilinan – have long been in hot waters with Duterte over the separate water concession agreement between the government and the Ayala-led Manila Water and Pangilinan’s Maynilad.  

The President had been outraged after separate arbitral rulings ordered the Philippine government to pay P7.39 billion to Manila Water and P3.4 billion to Maynilad for the non-implementation of rate hikes

Duterte then began making threats against the Ayala family and Pangilinan, prompting both water concessionaires to waive the results of the arbitral rulings and no longer demand payment from the government.

The President has since offered the Maynilad and Manila Water new deals crafted on the government’s terms, but Duterte also warned he would send the Ayalas and Pangilinan to jail if they refuse the new contracts. – Rappler.com

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Mara Cepeda

Mara Cepeda specializes in stories about politics and local governance. She covers the Office of the Vice President, the Senate, and the Philippine opposition. She is a 2021 fellow of the Asia Journalism Fellowship and the Reham al-Farra Memorial Journalism Fellowship of the UN. Got tips? Email her at mara.cepeda@rappler.com or tweet @maracepeda.