MRT manager probed on $30-M shakedown

MANILA, Philippines - The head of the Metro Rail Transit has been tagged by the Czech ambassador in the alleged $30-million shakedown attempt on a Czech supplier of trains for MRT 3 expansion, Transportation and Communications Secretary Joseph Emilio Abaya said yesterday.

In a press briefing, Abaya said an investigation into the allegation by Ambassador Josef Rychtar against MRT general manager Al Vitangcol III and some private individuals had been launched.

He said that in several meeting with Rychtar, the latest of which was last Thursday, the envoy mentioned the names of Vitangcol and other individuals.

Vitangcol was appointed in January 2012. Before his designation at MRT, he was concurrent director of the Public-Private Partnership Center of the Philippines for Policy Formulation and Evaluation Monitoring Service.

“We are already investigating the matter, and welcome any other investigations into this issue. The DOTC (Department of Transportation and Communications) remains fully committed to daang matuwid,” Abaya said.

“If found guilty, we will throw the book at him. But if he is not guilty his name would have to be redeemed,” Abaya said, referring to Vitangcol.

He said he had already talked with Vitangcol, who denied the accusations.

Abaya did not mention the names of the private individuals named by the diplomat, saying his office has no jurisdiction over them.

Rychtar alleged that some transport officials had promised Czech-based Inekon Group the contract to supply the trains for the MRT 3 expansion in exchange for $30 million – later whittled down to $2.5 million. Spurned, the officials reportedly blacklisted Inekon Group and barred it from bidding to supply trains for MRT 3 along EDSA.

At Malacañang, presidential spokesman Edwin Lacierda denied Inekon had been blacklisted and asked Rychtar to back his allegations with evidence. “We are asking the Czech ambassador – as in any accusation – present us evidence and we will investigate,” Lacierda said.

According to Abaya, the Inekon Group was among the five companies that bought bidding documents from the DOTC but did not show up during the actual bidding. He said the agency is now in the process of post-qualification. He said Dalian Locomotive CNR submitted a bid of P3.759 billion or P10 million lower than the indicative price of P3.769 billion.

Only two bidders submitted their bids, while CSR Zhouzhou was disqualified.

The DOTC chief said he would review the terms of reference for the bidding and would order a rebid if any irregularity is uncovered.

Abaya also cleared President Aquino’s sister Balsy Cruz of any involvement in the alleged extortion, saying he personally knew the daughter of the late President Cory Aquino, whom he had served as aide de camp.

“It is not her character so I am sure she is not involved,” he said. The Czech ambassador had earlier cleared the presidential sister.

The alleged anomalous offer was made when Manuel Roxas II was still DOTC chief. Abaya took over from Roxas after the latter was appointed head of the Department of the Interior and Local Government following the death of Secretary Jesse Robredo in a plane crash.

“This is precisely what the DOTC is investigating. We at the DOTC express in the strongest possible terms our commitment to fight corruption at all levels. We will take all the necessary steps to uncover the truth behind these allegations, which remain unsubstantiated at the moment,” Abaya said.

No blacklisting

He also clarified that the DOTC has not blacklisted Inekon as claimed by the diplomat.

“Inekon has not been blacklisted. There is no blacklist. There is simply no truth to the claim,” he added.

Abaya said the DOTC even asked Rychtar during a meeting in April to encourage Inekon to participate in the bidding for the P3.8-billion MRT 3 Capacity Expansion Project.

He also invited those who may have been approached by corrupt DOTC officials to come forward, submit sworn statements, and file a formal complaint.

He also denied the diplomat’s allegation that the DOTC had never bothered to examine Inekon’s proposal.

“The proposal of Inekon was carefully evaluated. Feedback from the planning department is that based on experience, a government-to-government arrangement will take a long time based on DOTC’s timeline and the demands of riders to address shortage of coaches of MRT 3,” Abaya said.

“Likewise the approved budget of contract which Inekon wanted was higher than what the bids and awards committee thought was reasonable and fair,” he added.

“DOTC has explained this to the ambassador a few times,” Abaya said.

After its government-to-government proposal was declined, Inekon indicated interest in taking part in a public bidding, he said. “Inekon bought bid documents and we really encouraged them to participate; however, eventually they didn’t submit a bid,” Abaya said.

The DOTC is bidding out a contract worth P3.8 billion for the supply and delivery of 48 new trains to augment the existing 73 Czech-made trains.

Almost 600,000 passengers take the MRT 3 daily along the 16.9-kilometer stretch of EDSA from North Ave. in Quezon City to Taft Ave. in Pasay City.

In the expansion program, the government hopes to cut waiting time for commuters to 2.5 minutes from three minutes by providing them with four-car trains during peak hours at any one time and direction from the current three-car trains. 

Abaya said the DOTC has chosen a solicited bidding mode for the project to ensure a level playing field, openness, and transparency. He pointed out that a direct contracting mode is not as transparent as an open bidding.

“Opening the project to bidding erases doubts as to any favoritism. I personally felt that the Inekon proposal – which was never formally submitted to the DOTC and which amounted to around $3 million per LRV (light rail vehicle) – could make it appear that favors were being made,” Abaya said.

Notably, DOTC’s approved estimate was only $1.8 million per LRV or $1.2 million per LRV less than the amount in the Inekon proposal.

The government had also received but later turned down offers for the supply and delivery of secondhand trains from Metro de Madrid of Spain as well as from the government of the Czech Republic, an arrangement allowed under Republic Act 9184 or the Government Procurement Reform Act.

Integrity undoubted

Abaya also vouched for the integrity of DOTC officials appointed by or who had worked with Roxas.

“Having worked with the current DOTC undersecretaries, assistant secretaries, and members of our bids and awards committees, I vouch for their integrity and good work ethic,” he said.

Abaya said that while it was his prerogative to bring in his own people after his appointment to the top DOTC post, he felt no need to remove Roxas’ appointees.

His two appointees to top positions in DOTC’s attached agencies – Light Rail Transit Authority (LRTA) and Maritime Industry Authority (Marina) – were former classmates.

LRTA administrator Honorito Chaneco was his classmate at the Philippine Science High School while Marina administrator Maximo Mejia Jr. was a fellow Midshipman at the US Naval Academy in Annapolis.

Chaneco was assistant general manager at the Philippine Reclamation Authority where Abaya’s brother Peter Anthony is general manager and chief executive officer.

Mejia was a lecturer at the World Maritime University in Malmo, Sweden.

Lacierda, meanwhile, said Abaya promised to explain in detail the circumstances that may have led the ambassador to make the accusations, in an effort to clear the names of his officials.

He also said it would be better to hear statements from the Czech ambassador himself.

Lacierda also said Abaya is in full control of the DOTC, contrary to reports that Roxas is the one actually running the department.

“Every secretary, when he enters, has a free hand in reorganizing the department,” Lacierda said, adding it was the prerogative of Abaya to retain or remove those appointed by Roxas.

“It’s his style. The instructions were clear. First, Secretary Jun Abaya had a free hand to reorganize and to appoint his own people. He decided in the interest of the public to retain the persons that were already there. So, there were also some… (undersecretaries) there who were also not appointees of Secretary Mar,” he said.

Lacierda allayed fears the incident would affect the perception of foreign investors on the Philippines.

“The first issue alone, Inekon was blacklisted, is already not true,” he said.

“We are leveling the playing field. There is no reason for us to doubt that this administration’s purpose is to level the playing field, to allow foreign investments to come in. From one perspective, the Czech ambassador said that Inekon was blacklisted,” Lacierda said.

Meanwhile, the Office of the Ombudsman may order its own investigation into the Czech diplomat’s allegation.

But Assistant Ombudsman Asryman Rafanan said the anti-graft agency would have to get more information first before launching a probe.

“I think we will have to study the nature of the allegations first because this appears to be new,” he said. –With Michael Punongbayan, Aurea Calica