Second of three parts
The real score and real numbers must be made known. Public-private partnerships (PPPs) are so much more than what is reported by the PPP Center. PPPs go beyond the build-operate-transfer law.
(5) It’s 24, not just 9 modalities. What has been officially reported by the PPP Center are 12 projects awarded under the BOT law applying BOT, build-transfer-and-operate or build-lease-and-transfer schemes. What is not captured on the PPP Center’s web site are other PPP modalities governed by laws and regulations other than the BOT law.
The BOT law only lists down nine variants. Joint ventures (JVs), concessions, leases, privatization, and management and service contracts utilizing or not using public funds are other variants. Onerous and gratuitous donations, corporatization, rehabilitate-and-transfer, rehabilitate-lease-and-transfer, rehabilitate-transfer-and-operate complete the roster of possible modalities. In fact, there could be more. Innovation should be encouraged.
(6) Happy 25th year. Two landmark PPP legislations marked their 25th year last year. Republic Act (RA) 6657, or the BOT law, was enacted in July 1990. RA 7160, or the 1991 Local Government Code (LGC), was signed into law in
October 1990. The LGC is the enabling law for JVs by local government units (LGUs). This is the same law that empowers LGUs to pursue PPP modalities not otherwise prohibited by law.
(7) 35 LGU PPPs as against 12 nationals PPPs. What is not captured on the PPP Center web site are the PPP projects awarded by provinces, cities and municipalities. In the past six years, LGUs have awarded at least 35 PPP projects, 23 more than the national government. Projects range from reclamation, power, water supply, hydropower, markets, capitol redevelopment, terminals, bridge and seaport projects.
This truly demonstrates bottom-up development and the breadth of local autonomy. I hope this is acknowledged and respected by those who want to stymie local initiatives. These LGUs must be commended rather than their PPP ordinances repealed.
(8) 66 PPP codes proposed to be “killed.” There is a pending bill in Congress, certified as urgent by the President, which proposes to expressly repeal 66 PPP ordinances enacted by LGUs. Enactments by 20 provinces, 32 cities and 14 municipalities will be negated. For those advocating this, they should be mindful that no one has the monopoly over righteousness and expertise.
(9) 12 GOCC water JVs. Also not on radar and promotional materials of the PPP Center are JVs by water districts entered under the 2013 Guidelines issued by the National Economic and Development Authority. Bulk water supply, rehabilitation and operations and management projects have been awarded.
(10) 50 possible risks. PPPs are not risk-free. Proponents, parties and payors of PPP projects must know that PPP projects may flop, be derailed, delayed, hailed to court, and not actually serve the public good. There are at least 50 risks that may hound PPP projects from inception to end of project life.
There are successor, demand, regulation, foreign exchange, legal, taxation, protester’s, environmental, weather, financing and operations risks, just to name a few. Risks may be clustered into four—policy and political, economic and fiscal, process and legal, and environmental and
spatial. To be continued