POSTSCRIPT / January 4, 2005 / Tuesday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Gov't neglected alternate routes to toll expressways

NO PLANNING: One thing most government officials have never learned to do is to think ahead. And act ahead.

One case in point: The whole world knew well in advance that the toll rates would go up at the South and the North Luzon Expressways, on Jan. 1 in the SLEx and soon after in the NLEx.

The toll rate increase, as much as 400 percent in the North, is likely to cut the normal traffic volume in the two main roads out of Manila. Many motorists feeling the pinch are likely to look for alternate toll-free routes.

In the face of this certainty, what has the government done to prepare the alternate routes? The answer is NOTHING. That is because we have not learned to think and act ahead of developing problems.

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ALTERNATES: In the South expressway, the obvious alternate routes are the service roads on both sides of the SLEx and the road passing in front of the airport. There is also the coastal boulevard between Manila and Zapote, but it is also a toll road.

Since the SLEx toll rates went up Jan. 1, those alternate routes have been experiencing heavier traffic everyday. Nothing has been done to prepare them to carry more vehicles at a faster rate with a minimum of pedestrian and parking obstruction.

In the North expressway, the rates will rise sharply as soon as the operator (Philippine National Construction Corp.) turns it over to the Manila North Tollways Corp., which is almost done with upgrading the 84-kilometer road from Balintawak to Mabalacat, Pampanga.

To absorb the vehicles turning to toll-free roads running in the same direction, what has government done to prepare alternate routes such as the MacArthur Highway and the Pampanga-Bulacan roads east of the NLEx? NOTHING!

As usual, the government is probably waiting for the diverted traffic to build up before it starts to act.

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ALVAREZ WRITES: I said in my POSTSCRIPT of Dec. 28, 2004, that the government did not go to court with clean hands in assailing the Piatco (Philippine International Air Terminals Co.) contract to build and manage Terminal-3 of the Ninoy Aquino International Airport (Naia-3).

If the Naia-3 deal is legally flawed, I said it could not have been solely the fault of Piatco. The government, or at least the officials who represented it, are equally to blame. I asked why Malacanang was not going after them also.

I asked among other things: “How come the family company of then Transportation and Communications Secretary Pantaleon Alvarez that had a contract related to Naia-3 was allowed to collect payments for allegedly fictitious ground works and spared from criminal charges?”

This elicited a reaction from the former Secretary. Writing on the letterhead of his lawyer “to provide you with the following information just to set the record straight,” Alvarez pointed out in a letter received Dec. 30, 2004:

“1. Indeed a plunder case was filed against me and other individuals with the Office of the Ombudsman arising from Piatco’s contract with the government including the question on what you referred to as ‘allegedly fictitious ground works’ but this has been dismissed for lack of merit.

“2. The Technical Services Audit Division-B of the Commission on Audit has submitted an Evaluation Report dated August 22, 2002, upon request of the Manila International Airport Authority indicating that the cost of the demolition of the subterranean structures is reasonable.”

I thank the Secretary for confirming that he was, indeed, “spared from criminal charges.”

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ANOTHER REJOINDER: Guillermo G. Cunanan, intended general manager of what Piatco was to operate as NAIA Terminal-3, also sent a rejoinder.

He was never mentioned in my recent discussions on the government takeover of Naia-3, but since I found in his email some relevant responses to the government’s position, I am reproducing parts of it:

“What scares investors in this case is not the application but the misapplication of the laws. If only the government and the Supreme Court would explain their decisions on the Piatco case in a manner that shows to the public honesty and fairness, there would not have been any reason to fear that investors would run away from our country.

“You yourself admitted (I did not ‘admit’ it; I said it. — fdp) that the administration did not act with clean hands on the Piatco case. You, however, spoke very little of their sins. That GMA cancelled the contract even before the Supreme Court decided on the case reveals much personal interest. (My comment was not ‘very little.” The entire half of POSTSCRIPT of Dec. 28, 2004, titled “Gov’t hands are equally dirty in failed Piatco deal,” was devoted to the government’s ‘sins’ in relation to Naia-3. — fdp)

“Why would a President cancel the contract on a vital and completed project that was approved by two of her predecessors and was previously declared legal by OGCC, OSG and Congress if she is not compelled by personal reasons? And why would the President risk so much unless she knew beforehand that the Supreme Court would validate her decision? Does GMA trust the competence of Solicitor General Benipayo that much to put the presidency on the line?” (Paging Malacanang. — fdp)

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S.C. RULING HIT: On the Supreme Court decision voiding the Piatco contract, Cunanan said:

“First: Why did the Supreme Court preempt the arbitration body when after all the case still had to undergo arbitration process? I wonder whether you see the critical effect to our country, financially and morally, if the Supreme Court position is reversed by either the ICC or ICSID, the international arbitration bodies involved in the case. (I may comment on this issue in coming POSTSCRIPTs. — fdp)

“Second: Why did this case not pass through the lower courts? Should the facts of the case not have been tried by the lower courts first? Even assuming the facts have been established, still, the Judicial Doctrine of Hierarchy of Courts should have been followed as facts of a case are not only established but are also weighed by the lower courts.

“On that question, the Supreme Court offered a weak explanation — that the case has transcendental importance because it involves the premier international import.

“Third: Why did the Supreme Court annul the contract when the petitioners did not even pray for annulment?

“The Supreme Court nullified the contract on two main grounds: the financial qualifications of Piatco and the supposed illegal guarantee. (The other issues including the questioned amendments are side-issues that could not have resulted in annulment considering that the contract includes a separability clause.)

“Fourth: Isn’t the issue of lack of financial qualification moot and academic after Piatco had proven that it is financially capable by actually completing the project?

“The Piatco contract is a perfected contract. It has never been proven that PBAC decided in bad faith. The Office of the Solicitor General, the Office of the Government Corporate Counsel, NEDA-ICC and Congress sustained the validity of the contract which supports the PBAC decision. Isn’t that proof enough that PBAC decided rationally and in good faith? If all those agencies were bribed, then that should be proven and the guilty parties should suffer?

“Even assuming PBAC erred, why should the error of the government be taken against Piatco?

“On the second issue which is the illegal direct guarantee, (there is no provision in) the ARCA or any of the amendments that will give any of the Piatco creditors the legal right to claim payment from the government in case the company defaults on any of its obligations.

“Even assuming that in good faith the government agreed on a contract that by implication provided a direct guarantee, should it result in the annulment of the contract? Until now no case of fraud has been proven. Since there is no fraud committed and the government allowed the provision in good faith why should Piatco suffer? As a remedy, is it not simpler, just and fair if the Supreme Court just ruled that the government cannot honor any guarantee arising from the contract and allowed the project to proceed?”

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(First published in the Philippine STAR of January 4, 2005)

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