The chairman of the Senate Committee on Finance on Thursday asked the House of Representatives to junk the P53.9-billion Metro Rail Transit (MRT) 3 buyout plan in its proposed version of the 2015 national budget bill.
During the bicameral conference committee on the proposed budget, Sen. Francis “Chiz” Escudero said that a government buyout of the MRT 3 is a waste of money. “We [the Senate] removed the provision for MRT 3 buyout. The allocation for the MRT buyout is P53.9 billion. Why spend P53.9 billion on something that won’t improve the plight of the riding public insofar as the MRT 3 is concerned?” he said.
The Department of Transportation and Communications (DOTC) planned to buyout Metro Rail Transit Corp. (MRTC) in a bid to improve the services of the MRT 3 that serves commuters from Quezon to Pasay cities.
Chairman of the Committee on Appropriations and Liberal Party Rep. Isidro Ungab of Davao City has said that the House of Representatives has provided P53.9 billion in its proposed P2.606-trillion 2015 national budget for the government buyout and takeover of the operations and management of the MRT 3.
Escudero said he is also wary that the bulk of the takeover appropriation will just be used to pay for the bonds held by state-owned Land Bank of the Philippines (LandBank) and the Development Bank of the Philippines (DBP), which controls 80 percent of MRTC, the owner of the mass-transit railway.
“Even if we buy it out, it will not improve the service anyway, it will only go to the pocket of one agency to another, namely, LandBank and the DBP,” he said.
According to Escudero, the Senate doesn’t see any improvement in the MRT 3 service even after spending P53.9 billion for the buyout plan.
“So, instead, we reallocated the unprogrammed fund to cover approximately P10 billion to improve the MRT 3,” he said.
Escudero said that it is better to realign the fund to more essential services for the general public, like the much-needed infrastructure to ease traffic congestion and disaster-preparedness programs.
The senator, however, said the issue on the MRT 3 buyout will still be under discussion between members of the bicameral committee.
Earlier, Metro Rail Transit Holdings II Inc. Chairman Robert John L. Sobrepeña said the benefits from the planned takeover of the MRT 3 are minimal to nil, as it only provides for the exchange of money from one government agency to another.
He said the multibillion-peso budget is not enough to compensate for the whole train line, as the amount only accounts for the bonds owned by the DBP and LandBank. “The P54-billion equity value buyout would not in any way benefit the maintenance and rehabilitation of the MRT 3 system, but will only be used to retire the bonds already owned by DBP and LBP,” he said in a BusinessMirror report.
Definition of savings
Meanwhile, members of the bicameral conference committee have agreed to adopt a new definition of savings.
Escudero and Ungab, in a news conference also on Thursday, assured the public that the bicameral committee’s definition of savings complies with the Supreme Court decision against the Disbursement Acceleration Program. “[However] we haven’t approved it yet. It’s a bicameral conference committee proposal. There’s a working draft already [on the definition of savings],” Escudero said.
Under the bicameral committee recommendation on the use of savings, the President, the Senate president, Speaker of the House, Supreme Court chief justice, the head of constitutional commission enjoying fiscal autonomy and the Ombudsman are authorized to use savings in their respective appropriations to augment actual deficiencies incurred for the current year in any item of their respective appropriations. It also said that the foregoing constitutional officers authorized to use savings shall be responsible for ensuring that a semestral and annual report on their respective use of savings shall be submitted to the Senate Committee on Finance and the House Committee on Appropriations, copy furnished the Department of Budget and Management.
Savings refer to portions or balances of any released appropriations in this, which have not been obligated as a result of any of the following:
- Final discontinuance or abandonment of an ongoing program, activity or project (PAP) by the head of the agency concerned due to cause not attributable to the fault or negligence of the said agency.
- Non-commencement of the PAP for which the appropriations is released. For this, purposed, non-commencement shall refer to the inability of the agency or its duly authorized procurement agent to obligate the released allotment and implement the PAP due to natural or man-made calamities, or other causes not attributable to the fault or negligence of the agency concerned during the validity of the appropriations.
Ungab said that savings may likewise refer to available balances of appropriations from unused compensation, unfilled, vacant positions, non-entitlement to allowance and benefits, leaves of absence without pay and unutilized pension and retirement benefits arising from death of pensioners.
6 comments
In the past months, Secretary of DOTC Jun Abaya had so many announcements for this buyout. He even declared the greatest confidence in completing this buyout when the 2015 budget’s released. The two biggest MRT-3 investors are Land Bank of the Philippines (LBP) and Development Bank of the Philippines (DBP), which have majority representation in the MRTC board, including the board chairman. He placed the value of the two banks’ exposure at $619.1 million, plus a “return” of $312 million for a total of $931.1 million. He valued “non-DBP/LBP investments” at $95.8 million. His funding request also included $143 million for taxes and $2 million for legal fees.
Seems Abaya was misinformed or is misinforming the public of what the DBP and LBP actually owns.
More likely misinforming the public. Tsk tsk.
I agree with Senator Escudero about the buyout I don’t think we would be better after the buyout I think things would go downhill from there.
Why can’t they just be on the same page and agree to a solution that would benefit the commuters?
Because this whole thing is riddled with corrupt and self serving politicians. The commuters’ benefit are far from their minds.