Admin gives up on DOTC PPPs

At least now, they are being honest and realistic. The PPP Center head has admitted that just five PPP projects are expected to be completed by the end of the Aquino administration’s term. The measly four-kilometer Masinag LRT2 extension is not one of the projects.

The Aquino government has been criticized over the delays in rolling out the PPP program. The administration has less than three years left and only two of the more than ten PPP projects lined up in 2010 have been successfully bid out. The two DepEd school building projects though being implemented already were not on the original list.

Government bureaucrats are claiming they had to make extensive reviews to plug loopholes, given problems in the past. But prospective investors have recently complained of onerous contract terms which led to the failure of one major bid and the delay in another.

PPP Center executive director Cosette V. Canilao told a capital markets forum last week that: “We will finish Daang Hari. We will finish the two school projects. We will finish the (orthopedic) hospital. We will finish the Ninoy Aquino International Airport (NAIA) expressway ... So we have five projects that will be finished in the remaining term of President Aquino.”

Ms. Canilao is asserting that “2015 will be the height of construction for the projects that will be rolled out in the next few months, and what’s more important to us is to leave a very successful program to the next administration...” Hahaha! Umasa ka pa, Cosette!

I can understand why Cosette is trying so hard to be optimistic. She has one hell of a frustrating job and I commiserate with her. She has done her end of the assignment but the problems are really with DOTC and DOF.

Note that not one of the projects Cosette hopes will be finished before June 30, 2016 is from DOTC. Yet, up until last month, DOTC Sec Jun Abaya was still assuring the public “that the term of President Aquino will not end without at least two or three public-private partnership (PPP) projects done.”

The Tribune report quoting Sec Jun’s optimistic forecast didn’t say what those two or three PPP projects to be completed are. But it is logical to assume he was thinking DOTC PPPs. Wala pala.

At last Sec Abaya can be true to himself now. It is tough on the conscience of someone like Sec Jun to lie through his teeth every time he says even one of his projects will be delivered before P-Noy leaves office.  

Those responsible for DOTC’s colossal failure are now busy trying to justify themselves. According to Business World, DOTC Usec Rene K. Limcaoco admitted that the government “could have gone faster” in the implementation of some projects, but said the process involved a ‘learning curve.’”

Limcaoco excused their failure saying “We were starting off from scratch. When we came in, we had an empty cupboard and we basically had to start everything from scratch.”

Come on, Timmy… you know that’s not true. In fact, it is a blatant lie to say that Mar Roxas’s team started with an empty cupboard. You had studies upon studies ready but you guys didn’t know how to start. Ping de Jesus left a few projects ready for implementation, including the navigational system for NAIA to replace those aging radars, the same one that would have prevented the mass cancellation of flights last week.

DOTC’s learning curve came with a high matriculation fee. Transport expert Rene Santiago estimates DOTC inaction has cost the economy more than P35 billion in economic losses and still counting.

It is however sad and alarming that P-Noy has apparently bought the excuses of Timmy and company as valid. At the FOCAP meeting last week, P-Noy said the delays are not entirely government’s fault.

“It depends on the PPP project. Some of the bidders themselves asked for an extension on the bidding deadline,” Aquino said, referring to the LRT-1 extension and Mactan-Cebu airport projects, among others.

The truth is, bidders for these projects had to keep on asking for clarifications on the technical and financial specs because the terms of reference provided them were so badly written. And because DOTC had a serious technical deficit which Timmy Limcaoco calls “learning curve” things just kept going back and forth, eating precious time.

You would have thought that because they practically converted DOTC to a law firm, they would be able to clear up legal problems quickly and competently. But that has not happened either.

P-Noy told FOCAP he had to cut short their forum because he has to run and resolve a legal issue with the connector road project which I thought had been resolved already.

Aquino said that apart from making sure contracts are clean, PPP projects like the NLEx-SLEx connector have legal kinks. He is talking about the joint venture between Manuel Pangilinan’s Metro Pacific and state-owned Philippine National Construction Corporation (PNCC), which owns the franchise for the two expressways.

“Would an entity not partnered with PNCC be authorized to have a connection with the NLEx and SLEx? That has to be resolved,” the President said.

As I reported in this column some months ago, there was a problem brought up by DOF Sec Cesar Purisima. Apparently, there is a Marcos decree that mandates inclusion of PNCC in any extension of the original north and south expressways.

It shouldn’t matter because PNCC is government controlled. But there is a pending case brought up by businessman William Gatchalian on the ownership of PNCC. He apparently submitted the highest bid in a privatization effort during Erap’s time but was denied the award. The Supreme Court could potentially rule for Gatchalian and government will lose control of PNCC. Gatchalian could be sitting on a cash cow without doing anything more. 

They could repeal the Marcos decree but that is not easily done and would delay the much needed connector road project indefinitely. The DOJ was reported to have issued two opinions but DOF is not convinced… hence the delay.

I really thought that was already decided and sad to know from P-Noy himself at FOCAP that it is still an open question. That only means further delay of a much needed infrastructure.

Anyway, Ms. Canilao tried to brighten up the sad reality of having just a few projects completed by saying they have started the process that will make the job of the next administration easier.

Unfortunately, that’s not how our government works. When a new administration takes over, they start from zero again. That’s why we have a library full of feasibility studies costing billions of pesos.

And so it goes.

Angat Dam

 Last week, I expressed worry over the serious consequences of a strong enough earthquake on Angat Dam. It is located near or at the West Valley Fault. There is a very real danger of flooding areas in Bulacan and Pampanga as well as depriving Metro Manila of its main source of potable water.

I wrote that MWSS head Gerry Esquivel mentioned to me some time ago that one of his urgent projects is retrofitting the dam to address the danger of earthquake damage. But government was more focused on privatizing Angat rather than addressing this danger to life and property in Metro Manila.

Gerry texted me his reaction: “The Angat Dam retrofit project was approved by the NEDA Board headed by P-Noy on September 2012. He was very supportive of the project. It was ready for publishing soon after.

“It was overtaken by SC decision validating KWater bid October 2012. I was relentless with remediation in spite of legal issues. But I could not get anywhere. I continue to pursue and told P-Noy about clear and present danger in light of the recent events. He agreed to meet and understands urgency.

“I am waiting for my turn. This project is way beyond legal…”

I asked if he can still finish the Angat retrofit project before P-Noy leaves office. He said they can construct it. “It’s the yes or no… I humbly think I can try to fast track like our aqueduct… finished eight months ahead of schedule.”

As for cost, he estimates a total cost of P5.7 billion, P5b for the strengthening and P700 million for flood forecasting.

If I were P-Noy I would act quickly. At least Gerry is nothing like the DOTC boys. Based on his record so far, he delivers on vital projects even ahead of schedule.

Thief

 In the middle of the night the congressman’s wife wakes up. Hearing noises downstairs, she taps her sleeping husband.

Wife: Hon, wake up. There are thieves in the house.

Cong: (half asleep) I know… but more in the Senate.

Boo Chanco’s e-mail address is bchanco@gmail.com. Follow him on Twitter @boochanco