THE GOVERNMENT is planning to amend the rules implementing the Build-Operate-Transfer (BOT) Law in a bid to avoid “onerous” contract provisions in public-private partnership (PPP) projects, just eight months before a new administration takes office.
President Rodrigo R. Duterte on Tuesday named Socioeconomic Planning Secretary Karl Kendrick T. Chua as the chairman of an interagency committee that would amend the implementing rules and regulations (IRR) of Republic Act (RA) 6957 as amended by RA 7718.
RA 6957 or the Build-Operate-Transfer Law authorizes the private sector to finance, build, operate, and maintain infrastructure projects.
In a joint statement, the National Economic and Development Authority (NEDA) and the PPP Center said the amendments aim to protect the public from “excessive payments and undue guarantees arising from PPP projects, and promote the interests of Filipinos, who ultimately pay for the costs and returns of private proponents of PPP projects.”
The committee plans to publish the amended IRR by the first quarter of 2022.
Mr. Chua said PPPs with unwarranted guarantees, contingent liabilities and “onerous” contract provisions take up the government’s limited fiscal space.
“PPPs have the potential to help stimulate the economy, bring back jobs, and address our people’s urgent, present, and future needs. However, it is the government’s job, on behalf of the Filipino people, to ensure that private sector interests are aligned to the public’s interests, with the overall goal of providing the best services to the people,” he said.
The process of evaluating PPP costs should be transparent and quick, Finance Secretary Carlos G. Dominguez III said.
PPP projects should also promote competition, avoid conflict of interest, and deliver commitments efficiently, he added.
The committee held its first meeting on Oct. 26 and will start stakeholder consultations in December.
The committee includes NEDA, the PPP Center, and the departments of Finance, Agriculture, Energy, Environment and Natural Resources, Information and Communications, Interior and Local Government, Public Works and Highways, Trade and Industry, and Transportation.
The Duterte administration had previously steered clear of PPPs due to allegedly disadvantageous provisions such as subsidies and guarantees.
However, experts have previously said that well-designed PPPs can accelerate the country’s “Build, Build, Build” program.
The “Build, Build, Build” program currently includes 112 priority projects worth P4.687 trillion. The government aims to complete 29 before Mr. Duterte steps down from office in mid-2022, while 51 projects are ongoing and 28 are in the pipeline. — Jenina P. Ibanez
