Gov't may accept unsolicited infra proposals

MANILA, Philippines – The government is reconsidering its earlier position that it won’t not accept unsolicited proposals for infrastructure projects that are not on its priority list, a ranking official said.

In an interview, Cosette Canilao, the head of the government’s Public-Private Partnership (PPP) Center said there is an ongoing review of the mechanism for unsolicited proposals.

“Do we really need to restrict to projects that are not in the priority list? Why not allow investors to submit unsolicited bids for projects that are already in the pipeline? We are looking into the pros and cons of this,” Canilao said.

In case the Aquino administration allows it, the government would have to put safeguards, she said.

In 2011, Finance Secretary Cesar Purisima said that the administration would stick to solicited proposals instead of unsolicited proposals, which are more prone to “sweetheart deals.”

A PPP is a contractual arrangement between government and the private sector to deliver public infrastructure and public services. It is being pushed by the Aquino administration so that it would have more funds for public health and education.

“The reason we said that in the past because the cause of our grief in the past were unsolicited proposals,” Canilao said, referring to the woes left behind by the controversial Ninoy Aquino International Airport (NAIA) Terminal 3.

The government was caught in a legal battle with the Philippine International Air Terminals Co. (Piatco) in connection with NAIA-3. Piatco was the consortium that submitted a winning proposal to build the terminal against AEDC, a Chinese-Filipino consortium that submitted an unsolicited proposal for the project.

In 2004, the Supreme Court nullified the Piatco contract, citing onerous provisions.

Canilao said that should the government accept unsolicited proposals for priority projects, it would have to make sure that even those that would be submitting counter proposals under a Swiss Challenge mechanism of the Build-Operate-Transfer Law would be subject to scrutiny.

“A PPP contract is very complex. It needs to be rule-based. Even if we subject a project to a Swiss Challenge, that proponent should be prequalified as well. It can’t be just anyone,” Canilao said.

The government’s review of the unsolicited proposal mechanism stems from the North Luzon Expressway (NLEX)-South Luzon Expressway (SLEX) Connector Road Project.

Metro Pacific has submitted an unsolicited proposal to link NLEX and SLEX, a blueprint which the government is still studying.

“We’re building a template for unsolicited proposals because of the NLEX-SLEX Connection Road project. We’re reviewing past unsolicited proposals and how we can improve unsolicited proposal mechanisms,” Canilao said.