Of lies and deceptions

HIDDEN AGENDA - The Philippine Star

These people probably think that we are a bunch of stupid people who will fall for their versions of the story hook, line and sinker.

All they do is tell a bunch of lines, or simply shrug their shoulders and feign innocence in the hope that the Filipino people, known for being able to forgive and move on with their lives though their rights have been trampled upon, will move on to the next chapter.

Executives of the Department of Transportation and Communications (DOTC) continue to blame others, except themselves and their partners in crime, for the never-ending woes of our country’s pride: the Metro Rail Transit Line 3.

Consensus was reached in a recent Senate hearing that the lasting solution to the MRT3 woes is for the private sector to fully operate it.

The DOTC’s P54-billion Equity Value Buyout (EVBO) simply will not work because the amount  will only be enough for government to purchase the MRTC bonds owned by two state-run banks and there won’t be money left to acquire a single coach.

Sen. Sergio Osmeña III even wants the DOTC to accept what he called the “perfect offer” of the Metro Pacific Investment Corp. (MPIC), an MRTC stakeholder, to take over MRT3.

DOTC Secretary Joseph Abaya and his underlings at the DOTC, Light Rail Transit Authority (LRTA) and MRT continue to muddle issues to make our legislators believe  that private partner MRT Corp. (MRTC) and the MRTC-picked original operations and maintenance (O&M) contractor Sumitomo Corp. are to blame for MRT3’s sorry state and that only a 100 percent government takeover can save it.

In fact, Abaya and his factotums like Undersecretary Jose Perpetuo Lotilla have had no qualms about throwing red herrings—such as baring plans to sue MRTC for an illusory breach of contract or unduly accusing Sumitomo Corp. of cannibalizing train parts prior to its unceremonious replacement by PHTrams and, later, APT-Global, just to take Senate and House probers off the scent of DOTC-style corruption and mismanagement that place over a half-million MRT3 passengers in harm’s way on a daily basis.

Despite these distractions though, our legislators have been able to uncover DOTC’s rejection of all five proposals by its supposed private partner to buy additional light rail vehicles (LRVs) at no cost to the government—the first four by MRTC from 2000 to 2007, and the fifth one by the Metro Pacific Investment Corp. (MPIC) in 2011 after it bought into this rail system via a cooperation agreement with the Fil-Estate Group that controls MRT Holdings Corp. (MRTH), which, in turn, owns MRTC.

As regards the private owners’ capacity expansion proposals, Osmeña said that the best available solution at the moment is for the DOTC to ditch its takeover plan and instead accept the 2011 proposal of MPIC.

According to Osmena, the only way to get out of management without going to court is to negotiate the MPIC offer, adding that (chairman) Manny V. Pangilinan is a professional manager and business entrepreneur and that It’s a perfectly good offer.

MPIC offered to take over MRT3 in 2011 when it bought into the MRTC that year via a cooperation deal with Bob Sobrepeña’s Fil-Estate Group. Media reports have bared that MVP had offered to take over MRT3 in exchange for procuring $300 million-worth of additional trains and buying another $350 million equity in MRTC.

Osmeña’s support for the MPIC proposal makes sense, given the sterling record of MVP and his group of companies in making profit centers out of private and public facilities such as Meralco,  Maynilad, PLDT, Philippine Long Distance Co. (PLDT), Smart, Philex Mining, and Metro Pacific Tollways Corp. (MPTC). 

Letting MPIC run MRT3 will be like throwing fish into water, given its current partnership  with the Ayala Corp. on the DOTC-awarded P1.088-billion Automated Fare Collection System (AFCS) for MRT3 and the P65-billion extension of the Light Rail Transit Line 1 (LRT1) to Cavite.

Abaya and his deputies would do commuters and all taxpayers as well a lot of good by considering this game-changing proposal of Osmeña.

Now, back to the congressional investigations and the things that our legislators have so far unravelled:

– That the DOTC has virtually taken over MRT3’s maintenance when it dumped Sumitomo Corp. on short notice in 2012 and then awarded without the benefit of public bidding and under suspicious circumstances the interim contract to PH Trams and, later, to APT Global.

– That DOTC executives lied in justifying the summary termination of Sumitomo on grounds that the latter refused to offer any financial warranty to continue operating MRT3 and even demanded an O&M fee to run the rail system that was much higher than those eventually awarded in succession to the PH Trams-CB&T and APT Global consortiums. It turns out that
Sumitomo had provided financial guarantees under its O&M contract;

– That in contrast, the subsequent contract fees charged by the PH Tram and APT Global might have appeared cheaper than the one asked by Sumitomo in 2012 because the DOTC had split the O&M caboodle into “chop-chop” contracts minus any financial guarantee or warranty as claimed by Abaya before the subcommittee. APT Global executive Vic Espiritu admitted that his firm’s contract did not have a warranty clause as their O&M deal did not require them to financially guarantee their work. This was because  their contract  only covered the labor component as the DOTC was in charge of supplying the spare parts.

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