Cancel P15.5-B project to acquire warships for PH Navy – Alejano

MANILA, Philippines – Magdalo Representative Gary Alejano in a privilege speech on Monday, January 15, called for the cancellation a project to acquire two warships for the Philippine Navy. 

He also asked for a congressional probe into the controversial project worth P15.5-billion that caused the removal of former Philippine Navy chief Vice Admiral Ronald Mercado

"There are clear violations by the contractor which endangers our AFP modernization program and our national security. By all means, we should cancel the frigate project contract before it is too late," Alejano said in his speech.

"Hindi tayo lugi dahil mayroong security bond ang HHI sa gobyerno amounting to 20% of the bidded price ba pwede nating i-confiscate (We will not lose money because the government imposed a security bond amounting to 20% of the bidded price, which we can confiscate)," Alejano said.

It is not clear how much downpayment HHI has paid.

Alejano, a former officer of the Philippine Navy, accused winning bidder Hyundai Heavy Industries of inserting provisions in the contract that are disadvantageous to the government.

"In my investigation, HHI employed the strategy called "bait and switch" which means that the contractor baits the buyer or client by offering superior systems or products and once he bags the contract he will find means to go around and eventually choose the lesser or inferior and thus cheaper systems or products to maximize profits," Alejano said.

The contention is over the Combat Management System (CMS) that will be installed in the ships. 

Mercado insisted on technology by Dutch company Thales Tacticos.  HHI, however, plans to install a supposedly similar technology by fellow South Korean Hanwha Thales.

Defense Secretary Delfin Lorenzana said Mercado was removed due to insubordination. –