Still a big problem
DEMAND AND SUPPLY - Boo Chanco (The Philippine Star) - March 16, 2018 - 12:00am

Budget Secretary Ben Diokno was wrong to tell me they have solved the right of way problems of the San Miguel-led NLEX-SLEX connector road. Ben said DPWH Sec Mark Villar used the savvy of his family property companies to fix the problem.

It looks like Ben will need more than the Orwellian tech surveillance methods he plans to use to monitor the progress of projects under Build Build Build. Ben will need informers working within DPWH to help him find out if Secretary Villar is telling him what is really going on.

On the connector road project of San Miguel, sources revealed to me that their ROW problems are far from resolved. Indeed, the announced opening of the segment up to the Paco station by yearend may not happen, if the ROW problems are not resolved fast.

Sources gave me some details about the ROW status for that segment up to Paco station: 1) Seven NGCP high voltage poles along Quirino avenue from the corner of Pedro Gil to small bridge (after Philippine Columbian) need to be relocated. 2) Awaiting DPWH/ NGCP negotiation for work to commence; 3) We got information NGCP has not bought new poles /accessories. 4) Completion of viaduct along Osmeña highway (from Buendia to corner Osmeña/Quirino) is possible by end 2018, but no ramp, so will remain useless.

Ben gave me the impression that his office would  effectively be the “bastonero” of all Build Build Build projects. But without good information, Ben will be clueless. His colleagues in the Cabinet can make false claims of progress.

Why is the completion of the connector road project important? Simple… because it is claimed that it can take as much as 50 percent of vehicles in EDSA during rush hours. San Miguel also plans to put up a BRT on top of that connector road to go all the way to Susana Heights which will help commuters now suffering that horrible MRT 3 service.

This project previously encountered ROW problems when motels in Sta Mesa refused to give way. This forced San Miguel to divert the route to run over the San Juan River, but the permit to do so slept at the Pasig River Rehabilitation Commission and DPWH for a year.

Here is something I found out some weeks ago about another priority project mismanaged by the Abaya-era DOTC and is suffering the same sad fate again under Secretary Tugade.

The secret status of the LRT 2 extension to Masinag is as follows: 1) Stations should be done by year end. 2) The rails/electro mechanicals had 2 failed bids. 3) DOTr budget is half of bids received. 4) Bidders had a meeting with DOTr after the first failed bid to adjust budget but no action. It is still same old budget except increase in construction time from 16 to 20 months.  5) DOTr is negotiating with Marubeni to reduce scope to meet present budget, but raises the question of how they will make the trains run.

That means the project will be delayed indefinitely without a bigger budget or a hefty discount from Marubeni. That means the traffic on Marcos Highway will be screwed up for a longer time than previously announced. 

That’s the problem with GAA-funded projects. If this was PPP, no such funding problems and the trains would have been running months ago.

 Incidentally, I also got a reaction to my column on Ben Diokno from an academic who knows the workings of government.

“There is no doubt Ben Diokno is one of the most competent and hard-working members of the Duterte government. But the lack of efficiency in infrastructure investment is beyond Ben’s sincerity (and Big Brother monitoring won’t help).

 “There are limitations in the institutions of a developing country that wants to ramp up infrastructure spending over a short time period. Both Indonesia and the Philippines are now in the same boat. 

“Last week, President Widodo temporarily halted all transportation projects, after a dozen major accidents that killed five and injured dozens. Indonesia is rushing the completion of the infrastructure projects in time for the Asian Games in 2018 and the presidential elections in 2019.

“But the empirical evidence shows that infrastructure projects are less likely to be successful when they are undertaken during periods of higher than average public investments (e.g. from 1.7 percent of GDP to 5.6 percent of GDP).

“This is because of present supply bottlenecks, technical manpower bottlenecks, poor project evaluation and selection procedures, and lack of sound policies and institutions for the selection and management of infrastructure projects (e.g. you have ceremonial groundbreaking ceremonies, but no actual construction). 

“In fact LRT1 has not started construction more than three years after the concession contract was implemented. It is also mind boggling for DOTr to announce to partly inaugurate the Metro Manila Subway in 2023, when in fact there is no firm financial closure vis-à-vis Japanese ODA and there is no definite starting date for construction. 

“There is also uncertainty MPIC will finish their connector road from NLEX Segment 10 to SLEX in the first quarter of 2021 as announced. The start of construction is still tentatively set for the third quarter of 2018. 

“The bureaucracy’s lack of technical capacity to assess the design of infrastructure projects (e.g. how local resources cope with front-loading of spending) is a problem. Scaling-up investments too much and too fast can only reduce the success rate of individual projects in the Build Build Build program, and limiting its impact on the economy. Since infrastructure build up takes time, the BBB Program should shift to a gradual scaling-up approach.” 

Finally, in a comment on my post on Facebook, Arnel Paciano Casanova who formerly headed BCDA, had this revealing observation: “Having implemented both ODA and PPP projects, I prefer the PPP. Moral hazard, risk allocation and delivery are three important factors to consider.” 

Boo Chanco’s e-mail address is bchanco@gmail.com. Follow him on Twitter @boochanco

BUILD BUILD BUILD INFRASTRUCTURE RIGHT OF WAY
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