Tatad: Shakedown at LRT

DAVAO CITY — Opposition senatorial candidate Francisco Tatad accused yesterday "some groups" identified with Malacañang of attempting to extort campaign money from at least two large Japanese multinational corporations interested in undertaking the $204-million Light Rail Transit (LRT) expansion project, allegedly to beef up the war chest of President Arroyo.

In an interview, Tatad vowed to unmask the alleged extortionists who he said were railroading and limiting the bidding of the LRT Line-1 Capacity Expansion Project to just two private firms — Kanematsu-Kawasaki Steel consortium and Sumitomo-Itochu joint venture.

A third interested bidder, Marubeni Corp., was rejected during the pre-qualification stage of the bidding process even as it said it had complied with all the bid requirements of the Department of Transportation and Communications (DOTC).

Marubeni is questioning the bidding process conducted last year, saying it was done "in undue haste."

"There are reports, unconfirmed, that a group closely identified with Malacañang had demanded some unofficial participation fee of $1 million each (from the bidders)," Tatad said. "Whether or not they obliged, we cannot say."

The former senator dared the President, who is seeking a full six-year term in May, to launch a probe into the alleged extortion try.

"Mrs. Arroyo must have this investigated if only to prove she is against such illegal transactions," said Tatad, who is running under the Koalisyon ng Nagkakaisang Pilipino (KNP) banner of Mrs. Arroyo’s chief rival, Fernando Poe Jr.

Deputy Presidential Spokesman Ricardo Saludo, the only Palace official reached by The STAR yesterday, refused to respond directly to Tatad’s allegations.

All Saludo would say was, "Did you ask him (Tatad) if he has proof? If he does, then we could take this further."

The STAR tried to get in touch with DOTC Secretary Leandro Mendoza but he could not be reached for comment.

Transportation Assistant Secretary Robert Castañares, chairman of the pre-qualification and bidding awards committee (PBAC), was also unavailable.

According to Tatad, the same group perceived to be close to the Palace is also demanding a five percent kickback from the total project cost, or about P571 million.

He said this group is pushing for the bidding to proceed despite a contrary recommendation early this year from the Department of Justice (DOJ) for the DOTC to restart the process to ensure it is aboveboard.

However, the DOJ’s legal opinion issued last month was vague.

While it leaned in favor of canceling the first bidding, the DOJ also noted that the decision to rebid the project shall be left to the discretion of the Light Rail Transit Authority (LRTA), the government body which has jurisdiction over the project.

Nonetheless, Tatad said the DOJ has cited the DOTC’s bidding rules that a bid proposal must include a letter of credit confirmed by a reputable international bank.

Kawasaki, Tatad said, merely submitted a financial advisory while Sumitomo submitted a bank statement from a local bank.

Marubeni, he noted, submitted the required documents but even its technical proposal was not read by the DOTC.

Through a legal counsel, Marubeni accused the LRTA, in coordination with its technical consultant, the Manila TREN consortium, of conducting a questionable evaluation of the bids of the three competing contractors on Sept. 4, 2003.

Marubeni said the LRTA has overlooked the defects in the bids of Kawasaki and Sumitomo.

LRTA’s PBAC opened the bids submitted by the three contractors on Aug. 14. A technical evaluation was conducted by the Manila TREN consortium, which recommended the approval of the proposals of Kawasaki and Sumitomo but rejected the bid of Marubeni on grounds of non-compliance with the requirements.

Manila TREN submitted the evaluation report to the LRTA on Sept. 4, which was approved the following day.

In the original schedule of the bidding process, the PBAC was given seven days to study and approve the evaluation report and the LRTA Board 19 days to concur with the PBAC approval to ensure a thorough evaluation of bids.

The LRTA has reportedly sought the Bangko Sentral ng Pilipinas’ (BSP’s) opinion on its grounds for acceptance of prequalified bidders.

The LRT Line-1 Capacity Expansion Project 2 will be funded by a loan from the Japan Bank for International Cooperation (JBIC). It is due for completion by September 2006. - With Marvin Sy, Rainier Allan Ronda