The National Economic and Development Authority (Neda) is an Aquino administration policy public-private partnership (PPP) projects from the Investment Coordination Committee (ICC) Technical Board to speed up the approval process.
Socioeconomic Planning Secretary Ernesto M. Pernia told the BusinessMirror on Wednesday that as long as a PPP project meets the cost threshold of P2.5 billion, it would have to go through the entire ICC evaluation process. PPP was the mode preferred by the Aquino administration in upgrading the state of infrastructure in the country. So in 2014 a memorandum circular issued to then-PPP Center Executive Director Cosette Canilao by former Neda Director General Arsenio M. Balisacan said project appraisal for PPPs would no longer go through the ICC Technical Board but through a Technical Working Group, which would evaluate PPPs in just 10 working days. The recommendation then would go straight to the secretary-level ICC Cabinet Committee.
Critics of this measure, however, expressed concern that the reduction of the number of days for evaluation has compromised the quality of PPP projects.
It can be noted that since the 2014 memorandum circular, several PPP projects have suffered delays and underwent rebidding.
These projects include the Light Rail Transit Line 1 South Extension and, more recently, the Laguna Lakeshore Expressway Dike Project.
Both were initially approved by the ICC and Neda Board in 2014. Other PPPs that have encountered problems were the Davao Sasa Port project and the Cavite-Laguna Expressway, which were also approved in 2014.
Pernia did not say if he would issue another circular to withdraw the order of his predecessor.
Pernia, however, assured stakeholders that the Duterte administration has no plans of abolishing the PPP Center, and that PPP continues to be an option for infrastructure development. This is despite the shift of preference to the “Build, Build, Build” scheme that calls for more financing and government budget in funding projects. BBB projects need to go through the entire evaluation process also.
“We are still experimenting with different combinations of financing,” Pernia said. “ICC Technical Board go through the ICC Cabinet level.” But an industry official, who asked not to be named, said the change in policy would just drag the process further. “An additional layer will tend to delay the much-delayed process.”
The official noted that the PPP projects that suffered delays and underwent rebidding are those implemented under the BOT law and not other modalities. “The rules of the BOT law must be amended to reflect the new process.”
Pernia also said the government still plans to retain the use of the Project Development and Monitoring Facility (PDMF) as a resource for the preparation of PPP projects.
The PDMF is a revolving fund used to procure consultants and technical advisers, as well as conduct prefeasibility studies for PPP projects.
After a PPP project is awarded, the winning bidder is required to reimburse the cost to the PDMF only if the project awarded to them received financing from the fund.
“So far, no [need to use the PDMF for non-PPP projects]. There are available funds to conduct the FS [feasibility studies] for other projects,” Pernia said.
http://www.businessmirror.com.ph/ppps-no-longer-exempt-from-full-project-scrutiny-2/
Socioeconomic Planning Secretary Ernesto M. Pernia told the BusinessMirror on Wednesday that as long as a PPP project meets the cost threshold of P2.5 billion, it would have to go through the entire ICC evaluation process. PPP was the mode preferred by the Aquino administration in upgrading the state of infrastructure in the country. So in 2014 a memorandum circular issued to then-PPP Center Executive Director Cosette Canilao by former Neda Director General Arsenio M. Balisacan said project appraisal for PPPs would no longer go through the ICC Technical Board but through a Technical Working Group, which would evaluate PPPs in just 10 working days. The recommendation then would go straight to the secretary-level ICC Cabinet Committee.
Critics of this measure, however, expressed concern that the reduction of the number of days for evaluation has compromised the quality of PPP projects.
It can be noted that since the 2014 memorandum circular, several PPP projects have suffered delays and underwent rebidding.
These projects include the Light Rail Transit Line 1 South Extension and, more recently, the Laguna Lakeshore Expressway Dike Project.
Both were initially approved by the ICC and Neda Board in 2014. Other PPPs that have encountered problems were the Davao Sasa Port project and the Cavite-Laguna Expressway, which were also approved in 2014.
Pernia did not say if he would issue another circular to withdraw the order of his predecessor.
Pernia, however, assured stakeholders that the Duterte administration has no plans of abolishing the PPP Center, and that PPP continues to be an option for infrastructure development. This is despite the shift of preference to the “Build, Build, Build” scheme that calls for more financing and government budget in funding projects. BBB projects need to go through the entire evaluation process also.
“We are still experimenting with different combinations of financing,” Pernia said. “ICC Technical Board go through the ICC Cabinet level.” But an industry official, who asked not to be named, said the change in policy would just drag the process further. “An additional layer will tend to delay the much-delayed process.”
The official noted that the PPP projects that suffered delays and underwent rebidding are those implemented under the BOT law and not other modalities. “The rules of the BOT law must be amended to reflect the new process.”
Pernia also said the government still plans to retain the use of the Project Development and Monitoring Facility (PDMF) as a resource for the preparation of PPP projects.
The PDMF is a revolving fund used to procure consultants and technical advisers, as well as conduct prefeasibility studies for PPP projects.
After a PPP project is awarded, the winning bidder is required to reimburse the cost to the PDMF only if the project awarded to them received financing from the fund.
“So far, no [need to use the PDMF for non-PPP projects]. There are available funds to conduct the FS [feasibility studies] for other projects,” Pernia said.
http://www.businessmirror.com.ph/ppps-no-longer-exempt-from-full-project-scrutiny-2/
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