DPWH: Defer all bridge projects

The signing on Monday of a framework agreement would be just the start of a slew of activities to make peace work in Muslim Mindanao. The negotiators from the Philippine government and the Moro Islamic Liberation Front merely have pinpointed priority issues. A Transition Commission has yet to propose laws and constitutional amendments to ensure change. Included are sharing of tax revenues, and expansion of the Muslim Autonomous Region into Bangsamoro.

The MILF has to sell the idea to Muslims, Christians and Lumad (indigenous tribesmen) in Mindanao. The government has to convince the rest of the country to support, in terms of investments and tolerance.

Common understanding would be crucial. Moros and other regionalists must accept each other as brother Malays. Just that, they come from different subgroups (Ilocano, Ibanag, Gaddang, Kalinga, Ifugao, Igorot, Pampango, Zambal, Tagalog, Bicolano, Visaya, Waray, Ilonggo, Tiduray, Subanon, Manobo, Maguindanao, Maranao, Tausug, Yakan, to name but some). Too, that they happened to undergo different histories: some were colonized, others resisted nearly to extinction. And different religions are but incidental.

From inter-mingling they would discover more similarities than differences. All want to live, make a living, and worship in peace. All want families to prosper, and children to go to the best affordable schools. All want to be able to speak, travel, and interact freely. They laugh at the same jokes, and mourn similar losses.

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Defer all present bridge projects. That’s what Public Works Secretary Rogelio Singson wants to do, while the Senate investigates bridge works under past administrations. In the interim the Department of Public Works and Highways will examine the selection of three foreign bridge builders.

Which is just as well. For, one of the three constructors is pressing for contract provisos that could bloat newly approved project costs. Such provisos, because included in past contracts, had led to multibillion-peso cost overruns in 2001-2007, to the detriment of Filipino taxpayers.

In a memo for President Noynoy Aquino, Singson counseled to suspend three bridge projects to be funded by Britain, Austria, and Spain. The National Economic and Development Authority, chaired by Aquino, had approved the programs only last September 4. Two weeks later Sen. Sergio Osmeña III called for a review of bridge works under the Ramos, Estrada, and Arroyo tenures, totaling P11 billion. So on October 4 Singson advised to defer signing any new loan agreements with the three countries. This, after consulting with Finance Sec. Cesar Purisima and the Cabinet Economic Cluster.

The British government loan is to replace 133 worn-down bridges, at the cost of P8.4 billion. The Austrian loan would repair 66 bridges in calamity-stricken areas, for P6.12 billion. The Spanish grant would widen certain existing spans, for P4.97 billion. The three projects are extensions of old ones.

Each lending government has recommended a bridge supplier. Britain’s is Cleveland Bridges UK Limited. Austria’s is Waagner Biro. Spain’s is Centurion SA.

In view of the Senate probe of past projects, Singson said in the memo, deferring the newly approved ones would give the DPWH time to check the foreign contractors. “We need to verify and secure data that could be raised in the Senate,” he told the President through Executive Sec. Paquito Ochoa. This would ensure “that the proposed new projects are not anomalous and that these serve the best interests of the country.”

Specifically, Singson stated, they needed to verify if the suppliers are qualified in their respective homelands. Also, if they competitively were selected, as required in official development assistance (ODA).

Singson is being criticized for department under-spending that supposedly stunts economic growth. But domestic constructors say it is because he wants to ensure uprightness in present contracting. “Under your administration, no new foreign assisted bridge project has been signed so far,” Singson assured Aquino in the memo. “Although we have done our due diligence and long discussions to comply with government and NEDA requirements, deferring implementation would be advisable.”

The British supplier Cleveland Bridges UK Ltd. had been pushing since July for contract riders that the present DPWH finds unacceptable. Among these are:

• to not fix the contract amount but instead allow for variation orders (VOs), that is, changes in specs, materials, designs, deadlines, and price quotations;

• to allow the contractor a 10-percent profit margin on such VOs;

• for the DPWH to shoulder the cost of inspecting the bridge materials at the factory in Britain; and

• for the DPWH to provide free offices for subcontractors.

Singson reportedly rejected the four provisos last September 6, two days after the NEDA gave him the go-signal to sign the loan agreements with Britain, Austria and Spain.

DPWH insiders say that Cleveland Bridges used to be called Balfour Cleveland Consortium (BCC)s, Balfour Beatty, and Cleveland Balfour in past bridge contracts and communications. In a 2001-2007 contract as BCC, a DPWH internal memo stated, the British project incurred a cost overrun of P3.032 billion. The original budget ballooned from P2.4 billion to P5.432 billion, precisely due to VOs that delayed the bridge works but profited the supplier 10 percent.

Supposedly one of the DPWH bureaucrats who oversee the bridge works has been ignoring breaches of ODA rules and contract provisions. The insiders are asking for a lifestyle check of the official, who has just renovated a country home and bought the adjacent lot of his city residence.

The Commission on Audit has said that cost overruns in government contracts cost taxpayers P10 billion a year. It wants agencies to blacklist and fine erring contractors.

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