The President and the National Economic and Development Authority endorsed the postal modernization proposal, which would be undertaken at no cost or risk to Philpost, during the NEDA board meeting presided by Mrs. Arroyo as its chairman.
During the same meeting, the President and NEDA also approved three other major projects worth P13 billion.
These are the P8.6-billion Abaga-Kirahon-Maramag-Bulawan Transmission Project in Mindanao, the P1.2-billion Philippine Rural Electrification Project and the P982-million Angat-Maasin River Irrigation System.
The postal modernization project was proposed for Philpost as early as 2002 by the Japanese software developer Renaissance of Age (ROA) in order to improve the services of Philpost and increase its revenues which have been dropping for years.
ROA’s proposal improved as it underwent evaluation and became a build-operate-transfer (BOT) proposal when it was presented to the NEDA Investment Coordinating Committee Technical Board (ICC-TB) in June 2005, then a BLT project in November 2005.
The Philpost board of directors headed by its chairman, former press secretary Hector R. R. Villanueva, unanimously endorsed the project for consideration by NEDA-ICC and the Commission on Information Technology and Communications (CITC) which also supported it.
Under the proposal, ROA would computerize the Philippine postal system by leasing computers and other equipment to form the nucleus of the Philpost modernization.
ROA would then build and maintain modern postal applications and business systems worth P3.4 billion for more than 2,000 post offices throughout the country in seven years at no cost to Philpost. Training, maintenance, upgrading and replacements worth P2.3 billion would also be shouldered by ROA during the lifetime of the project.
With the computers and new business systems, Philpost revenues were projected to rise to P13 billion. At present, Philpost revenues range from P3.0 billion to P3.5 billion a year.
The ROA proposal was considered timely as Philpost services and revenues continue to decline due to outmoded systems and equipment, stiff competition from private groups and the introduction of modern technologies such as cell phones and the Internet that have reduced the people’s dependence on traditional stamps and letters.
Philpost officials and employees hailed the project proposal, stressing that the modern equipment and systems to be put up by the Japanese firm are expected to remarkably improve Philpost operations while increasing its revenues and the overall image of the government firm.
It will be Philpost managers and personnel who manage and operate the modern equipment and systems to be installed by ROA, thus assuring that there will be no dislocation among employees. The increased revenues of Philpost with the use of the ROA systems and the introduction of new businesses will, in fact, assure the availability of funds for the salaries and benefits of Philpost officials and employees.
Under the ROA proposal, post offices in Luzon, Visayas and Mindanao will be computerized, improved and connected with one another through the Internet and the Voice-Over-Internet-Protocol (VOIP) which shall be introduced as new revenue-generating services of Philpost.
Computerization and Internet services would enable Philpost to finally set up and operationalize a "track and trace" system for all mail and packages it receives and dispatches, sorting would be computerized and the Philpost accounting system would be online, thereby discouraging and reducing fraud.