• P-Noy told of MRT3 danger to life

    DEMAND AND SUPPLY By Boo Chanco
    (The Philippine Star) May 30, 2014

     

    If some tragic accident finally happens involving the MRT3, P-Noy may find some blood in his hands. A letter had been written to him last month that gave specifics of the many dangers to life and limb posed by inadequate maintenance of MRT3.

    Metro Rail Transport Corporation (MRTC) wrote P-Noy last April 2 expressing concern over the series of accidents happening in the system. MRTC pointed out the need to have a qualified maintenance provider. Obviously, MRTC has no confidence in the Vitangcol-installed maintenance company of his uncle-in-law.

    MRTC is the private sector owner of the MRT system but does not have day-to-day control over operations.

    Last Wednesday, my colleague in the Opinion page, Jarius Bondoc wrote about MRT3 being a disaster waiting to happen. I couldn’t agree more.

    Indeed, I have written as much in the past but it was like complaining to the wind. The DOTC reaction so far had been, wala lang… dedma.

    In my column last Sept. 8, 2013, this is what I wrote: “the MRT3 system is a tragedy waiting to happen. And even if a really serious accident happens and many lives are lost, nothing changes government’s basic inability to do anything.” It is as if DOTC and its MRT3 manager don’t care if commuters are injured or killed.

    Indeed, I just found out that DOTC and MRT3 management allowed the insurance of the system to lapse last May 1. That means passengers injured or killed are on their own.

    They had the same problem last year. GSIS refused to insure MRT3 because the maintenance provider is not certified by the original equipment manufacturer. No reputable reinsurance firm will take it.

    The administration compelled GSIS to insure MRT3 anyway. Sources told me Vitangcol was insisting on coverage based on depreciated value, rather than replacement value. The thing is… being an important and crucial transport system, it should always be insured at replacement value (like airlines). Otherwise, if a train gets into a serious accident, the insurer may only cover say, 50 percent of the cost, and DOTC would have to shoulder the other 50 percent. That would unnecessarily waste taxpayers’ money.

    The latest information is that GSIS was again ordered to extend by two months but bid out for reinsurance by July 1, as if a reputable reinsurer would accept the system’s current maintenance provider.

    Anyway, if P-Noy wants to free his conscience of any potential guilt and culpability if a tragedy at MRT3 happens, he should look for that letter, read it and heed the request of MRTC “to direct DOTC to agree to an independent technical audit of the MRT-3 System.” And then have “a financially and technically qualified maintenance provider, with adequate experience… to maintain the MRT-3 System.”

    I was amazed when I saw and heard DOTC Usec Juju Lotilla justify the awarding of the maintenance contract to the company of Vitangcol’s uncle-in-law. Lotilla said they needed to do so in a hurry because the contract of the incumbent contractor, Sumitomo, was expiring.

    Luckily, Rep Rudy Farinas expressed his disbelief at that explanation. The congressman from Ilocos Norte said in so many words that he wasn’t born yesterday and he thinks the bureaucrats may have connived to make that emergency situation happen.

    Here is what happened according to MRTC in its letter to P-Noy:

    “As early as three (3) years ago, Metro Rail Transit Corporation (MRTC) raised with DOTC the need to bid out the maintenance of the MRT-3 System to a qualified maintenance provider after the term of TES-P/Sumitomo was ending, as required under the relevant Agreements. DOTC, however, did not act on this in a timely fashion.

    “With only a few days left before the expiration of the maintenance contract with TES-P/Sumitomo, DOTC required MRTC to conduct a public bidding to select a new maintenance provider for the MRT-3 System, and said that TES-P/Sumitomo must be taken out.

    “Considering the very limited time to conduct the necessary due diligence on the qualifications of prospective maintenance providers as well as the required publication of the proper notices to interested parties, MRTC was constrained to allow DOTC to undertake the selection of an interim maintenance provider with the condition that the Terms of Reference (TOR) will first be submitted and approved by MRTC.

    “However, in violation of the BLT Agreement and previous agreements, DOTC never submitted the TOR to MRTC for its consideration and approval.

    “Eventually, MRTC found out that DOTC appointed an interim maintenance provider, which turned out to be a joint venture between Philippine Trams Rail Management & Services Corp. and Comm Builders and Technology, Inc. (PH Trams-CB&T), without the benefit of any public bidding as mandated by law.  The appointment of PH Trams-CB&T was done through a negotiated arrangement.”

    Usec Lotilla claimed in the congressional hearing last week that a proper bidding was held. I don’t think that’s an accurate thing to say. Here is how I reported it in my July 8, 2013 column:

    “I had long suspected that DOTC rejected the MRT3 bid of Manny Pangilinan because of ulterior motives…

    “In fact, it may be well worth the time and effort of the Ombudsman to ask some pertinent questions behind the so called interim maintenance contract for MRT 3. Its award seems rather suspicious and that’s not the worse part… it could have life and death consequences for riders of the MRT.

    “I found out that there was some misrepresentation in a press release attributed to DOTC that announced the award. The story claimed that Miescorrail Inc., a subsidiary of Meralco, submitted an offer for the maintenance service at a monthly fee of $1.2 million a month, which is higher than that of the selected proponent at $1,150,000.

    “But Chito Francisco of Miescor wrote to DOTC ‘to set the record straight that they were unable to submit a comprehensive technical proposal and firm commercial offer because of insufficient time.’

    “Mr. Francisco’s letter recalled that ‘We received a letter from the DOTC·MRT3 last Oct. 9, 2012 inviting us to express our intent to maintain the MRT Une 3 System and present our technical proposal and commercial offer on Oct. 11, 2012.’ That’s just two days lead time for a complicated proposal. By Oct. 12, the Manila Bulletin already published a story announcing the results of the ‘bidding’. Obviously, niluto na.

    “No Terms of Reference was made available… the actual Terms of Reference of the original Maintenance Agreement were not provided. Hence, the definitive basis for the scope of works for the maintenance service and the performance requirement being demanded for which the proposal is to be prepared were not made available.

    “So, where did DOTC get the figure that Miescor was supposed to have submitted? Was there an actual bidding or just an awarding to a favored entity? ‘Emergency’ is being invoked but that is often used as an excuse to dispense with our strict procurement law with a negotiated agreement.

    “That interim maintenance contract has expired and they have extended it for a two month period that ended June 19, claiming emergency. I guess they are extending it two months at a time so they can claim emergency every time and go around the rules.

    “The new maintenance contract for a two month period is at $2,300,000. I went through the contracts as published on the DOTC website and there was no explanation if it was just for labor or includes spare parts. There must be an explanation but DOTC is not telling the public.

    “It is interesting to see the scope of the contracts. If the contracts only cover labor cost, that looks excessive in peso terms. At just P40-$1, P40 million pesos a month will buy a lot of labor time.”

    So, dear reader, it is an old story. It is getting tiresome writing about DOTC anomalies but someone has to do it. I am glad Jarius had always been there with the heavy guns.

    That maintenance contract was signed by one of the Usecs brought in by Mar Roxas to DOTC just before he moved over to DILG. He is supposed to be the handler of Vitangcol for Mar. That explains why Malacanang spokesmen were even defending Vitangcol against the Czech Ambassador rather than defend P-Noy’s own sister, Ballsy.

    As I said, P-Noy must realize he does not owe his election to Mar. No way did Mar sacrifice to “offer” P-Noy the presidency. Mar was finished by the time he made his supposed grand gesture to P-Noy. Mar himself came to the conclusion Manny Villar would beat him by the time he decided to quit.

    I hope P-Noy gets it to his head that he owes Mar nothing. He owes his election to us, his bosses, the Filipino people. Only then can P-Noy act decisively on the problem that DOTC has become with Mar’s left over crew there.