COA grants P22-M payment claim by PNCC for airport repairs

Lian Buan

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COA grants P22-M payment claim by PNCC for airport repairs
The amount was the excess cost on top of the pre-agreed cost of P46 million

MANILA, Philippines – The Commission on Audit (COA) ruled that the Manila International Airport Authority (MIAA) should pay a construction fee of P22 million to the Philippine National Construction Corporation (PNCC) for repairs done on the airport in 2000.

PNCC had earlier claimed P26 million, but the COA’s decision dated September 27 and released to media on Tuesday, October 24, only granted the claim of P22 million.

The amount was the excess cost on top of the pre-agreed cost of P46 million. 

Clearly, the contract price adjustment claimed by PNCC in this case is with knowledge and approval of MIAA,” the COA said.

Airport repair

MIAA hired PNCC in 2000 upon discovering wear leaks and structural damage on the roof of NAIA Terminal 1. The roofing “was in imminent danger of collapsing, specifically the roof deck slabs, columns and steel trusses at Gate Numbers 2, 7, 9 and 15,” the COA decision said.

PNCC was tapped in November 2000 to do the emergency work to ensure the safety of passengers, since they were then undertaking warranty maintenance waterproofing works at the airport.

A month later, upon the recommendation of engineering experts, the MIAA formally hired PNCC to take care of the entire repair. The contract was worth P43.9 million. It was further increased to P46 million during the construction period because of “adoption of new methodologies and approaches, including changes in the original plan of the project.”

The project was completed in October 2001. In June 2002, PNCC notified MIAA that the changes in the project amounted to an additional P26.112 million.

“PNCC justified that the additional cost incurred affecting the material, labor and equipment components of the original estimates were results of the inadaptability of the supplied plans, estimates, and methodology to the actual field conditions and requirements,” the COA said.

PNCC also said they needed to introduce new designs to “meet the main objective of the works.”

The COA decision does not mention MIAA’s reasons for not paying PNCC, but it acknowledges that the adjustments by PNCC were known by MIAA.

“MIAA and the public at large are benefitting from the construction works of PNCC. Clearly, to completely deny PNCC the payment would result in MIAA’s unjust enrichment at the expense of PNCC,” the COA said.

A COA evaluation report modified PNCC’s claim from P26 million to P22 million, and granted the same. –

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Lian Buan

Lian Buan is a senior investigative reporter, and minder of Rappler's justice, human rights and crime cluster.