Business group bares proposal for privatized EDSA busway carousel

Franco Luna - Philstar.com
Business group bares proposal for privatized EDSA busway carousel
Commuters wait in long queues for a "Libreng Sakay" by the Department of Transportation at the EDSA Carousel Bus Station along Main Avenue on Monday morning, July 18, 2022.
The STAR / Miguel de Guzman

MANILA, Philippines — The Management Association of the Philippines, a business group, has submitted a draft of its terms of reference (TOR) for a possible integrated concession agreement with the Department of Transportation to go ahead with privatizing the EDSA Busway Carousel. 

In a letter addressed to Transportation Secretary Jaime Bautista, a copy of which was obtained by Philstar.com, MAP Infrastructure Committee chair Eddie Yap said the communication was meant to "help jump-start the privatization process for the EDSA Busway System."

The private sector stakeholders urged a "two-step bidding process consisting of a technical bid for qualified proponents and the financial bid, which shall be the basis for the award."

However, Bautista, in an earlier roundtable discussion, highlighted the need for a feasibility study that could take months before talks leave the terminal. 

"We will seek help from experts like the PPP center. We will consider everything that we have discussed, but we have to define the terms of reference that will determine what we really want," he said on September 9.  

Global standards

MAP recommended aligning the project with measurable performance metrics based on busway standards outlined by nonprofit Institute for Transportation and Development Policy (ITDP).

Among the metrics outlined by the ITDP include: 

  • Bus Rapid Transit basics including the dedicated right of way, sensible busway alilgnment, off-board fare collection, and platform-level boarding 
  • Service planning such as serving multiple routes in a multi-corridor network, having set hours of operation monitored by a control center, and being located in the top ten corridors in the area
  • Infrastructure like passing lanes at stations, center stations, satisfactory pavement quality, center stations, and minimizing bus emissions 
  • Access and integrations services like bike lanes, universal access, integration with other modes of public transport, and pedestrian access and safety 
  • Stations
  • Communications

"These metrics...clearly set the commitments expected of the proponents and shall form the basis for evaluation of their technical bid," MAP said. 

"We believe that the metrics provide the objective bases that will facilitate the evaluation of the bids, and subsequently, the performance of the concessionaire."

Benchmarking of fares

MAP's draft TOR also included the benchmarking of busway fares to the average of commuter train fares currently operating, including the two Light Rail Transit lines and the Metro Rail Transit-Line 3. 

The group explained that the busway would be a lower-cost mass transit with the most favorable cost-to-benefit ratio compared to railways, which have elevated carriageways and rail tracks, among others, to maintain. 

Hence, the group said the busway fare should be lower than or comparable to train fares. 

Under the proposed terms of reference, the basis for awarding the concession is the lowest offered fare level. 

"The offered fare level is reflective of the proponent's capabilities, experties and efforts and as such is an ideal basis for the award," MAP said. 

"The lowest offered fare will be beneficial to the riding public. The previous practice of awarding to the proponent with the highest offered concession fee was not considered or favored."

Think tank to private sector: Commit to shouldering all infrastructure along busway

At the same roundtable discussion with transportation officials last week, Ed Francisco, President at BDO Capital & Investment Corp., admitted that scenarios outside of full privatization where investment can be recovered are still largely unclear along the busway, pointing to the number of possible permutations. 

The immediate plan proposed in the MAP's initial letter to the DOTr — and the usual model in many PPP projects — is for private operators to take on the operational maintenance while government agencies handle the infrastructure end.

"The project is still marred in a bureaucratic maze. So that's why I think if the concession will only be for the operations and management and then the concessionaire will depend on the government for the infrastructure, kawawa," Yap said. 

But in a statement sent to Philstar.com, Terry Ridon, convenor of public policy think tank Infrawatch PH, said the private sector should submit a proposal incorporating a reimbursement commitment on top of keeping bus fares competitive under private operations.

"If the private sector wants to privatize the EDSA busway system, it should foot the entire infrastructure bill," he said. "The only reason it can make such rosy projections on the project is the fact that it does not incorporate previous and current government spending on the entire line."

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