Skills deficit
DEMAND AND SUPPLY - Boo Chanco (The Philippine Star) - February 18, 2019 - 12:00am

I always want to give President Duterte the benefit of the doubt. But it is not easy to do because he always mouths propaganda half-truths peddled by some of his officials to justify failure.

Last week, Mr Duterte blamed the lack of skilled workers for the delay in the implementation of infrastructure projects under the ambitious Build Build Build program.

“Kaya ‘yang Build Build Build medyo atrasado ng konti. Walang trabahante…” Duterte said in a speech in San Jose del Monte City, Bulacan.

It is partly true that we do not have enough skilled workers that the construction industry can harness. But the bigger problem is the lack of skilled Cabinet members to lead the Build Build Build program.

One industry leader noted in one of my Viber groups that only three big projects have been awarded after two and a half years of this administration.

Ironic to note that Duterte’s economic managers rejected PPP in favor of ODA and GAA for BBB projects because PPPs “take too long to get going.” Maybe, everything just takes too long to get going in this government, except members of Congress cashing in on pork funds.

The groundbreaking of that much ballyhooed MetroManila subway project had been scheduled thrice and is still waiting. That common station for the metro rail systems at the Trinoma area is only now finally getting done.

Indeed, DOTr has had so many ceremonial events designed to give the impression that things are moving. But when a project, PITX, not only moved but was delivered by a private sector partner, DOTr immediately killed its market.

Skills deficit is not a new problem. The technocrats call it “lack of absorptive capacity.”

Former budget secretary Butch Abad used the term “technical deficit” to describe it. He blamed it for the failure of the Aquino administration to move vital infra projects.

His successor, Budget Secretary Ben Diokno explained it to me in pretty much the same way in a conversation I had with him.

Look at it this way, I recall Ben telling me. For years they didn’t have much to do or nothing as ambitious and complicated as the BBB projects. The bureaucrats just went on their merry ways and no one noticed.

All of sudden there is money, lots of money to do big projects and there is little or no internal capability to do or evaluate detailed technical stuff.

A foreign consultant confirmed to me Sec Ben’s observation. He said he noticed that technical staff in DOTr and DPWH have little exposure to current developments abroad.

They might have been talented young engineers when they joined government. But they have not been exposed to how things are now being done in more advanced countries.

That’s why I had been saying that PPP is the better option to see projects done more efficiently. The private proponent takes care of technical requirements.

Look at that engineering marvel of a bridge to link Cordova in Mactan and Cebu City.  MPIC had no problem hiring international experts to do everything from the feasibility study, detailed engineering design and to supervise construction.

Ang titigas ng ulo. Mas madali daw yung ODA at GAA. Hindi pala!

Now it seems Malacanang is getting worried. To speed up the implementation, it ordered government agencies to ensure the timely completion of infrastructure projects. Under Memorandum Circular 57 state workers were warned that neglect of duty and inefficiency can be grounds for disciplinary action.

A former bureaucrat made an interesting comment in a Viber group: “Lack of skilled workers??? Didn’t they say Build Build Build is an opportunity to bring back Pinoy skilled workers who have gone to work on similar infrastructure projects in the Middle East and elsewhere??

“Actually, it is the lack of technical expertise overwhelming the implementing agencies that must deal with the technical requirements to design, review and operationalize these projects... In other words, ‘nangangapa’...

“Nonetheless, the bigger cause of delay in Build Build Build is the indecisiveness of implementing agencies on the different technical and procurement/ financing procedures to be used by government...”

That’s true. Look at my favorite example: The San Miguel Bulacan airport and NAIA modernization. Both are ready to go projects… at no cost to government… urgently needed but still languishing in the labyrinths of the bureaucracy undergoing the umpteenth review.

So now it is crunch time. Here is how one academic who is familiar with government operations views it:

“Under DOTr’s watch, there is a big time gap between contract signing, groundbreaking, and start of actual construction. For the MRT-LRT common station project, contract signing was in early 2017, groundbreaking was on Sept. 29, 2017, and actual construction was on May 7, 2018.

“The last eight years of lost opportunity is sunk cost in project planning practice. We should now measure this administration’s project accountability beginning June 30, 2016.

“Sec. Tugade was successful in solving the inter-conglomerate rivalry on the location of the MRT-LRT Common Station in mid-2017, that is why there was a ceremonial groundbreaking in September 2017.

“But the Ayala section only started its construction on May 2018. The government side was only able to sign the design and build contract on Feb. 13 for the Area A segment, and who knows when the SMC’s and SM’s sections will start.

“From a rational project planning perspective, does a unified grand central station imply a contractor that integrates the construction of the so-called unified project? For now, it is kare kare planning and a chop suey implementation.

“Ayala uses MDA construction company, DOTr hires BF construction company, SMC recruits EEI, and SM may contract Megawide. Our track record on this kind of planning and implementation is not so good.

“My point is that using the construction efficiency standard of Singapore, Hongkong, and even Widodo’s Indonesia, DOTr still falls far behind.

“This kind of rail station project if undertaken in Singapore or Hongkong would have been completed within two years.”

But this is the Philippines!

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

BUILD BUILD BUILD PROGRAM RODRIGO DUTERTE
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