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Two blockbuster events today:

At 5 p.m., President Ferdinand Marcos Jr. and the First Lady Louise Araneta-Marcos inaugurate the new Philippine International Convention Center.

The renovation makes PICC world class again. Why?

The Discayas were not the PICC contractors, unlike the new NBI building on Taft and the Film Heritage building, both of which have the Discayas as contractor and both of which are delayed and are being constructed badly, per the Discaya standard, which is substandard.

At 6:30 p.m., DPWH Secretary Vince Dizon is guest of honor and speaker of the Manila Overseas Press Club’s ‘Infra Night’ at the Raffles and Fairmont Hotel ballroom. Vince is expected to update a select group of businessmen, professionals and senior journalists on the latest in the P1-trillion flood control scam or flood-gate, who have been charged and who are facing arrest and who are being investigated.

Reservations for Vince’s MOPC appearance have more than doubled in recent days after shocking revelations on how senators helped themselves, making insertion or amendments in the P6.326-trillion General Appropriations Act (GAA).

The insertions were between P103 billion (flood control alone) and P142 billion, the total insertions then SP Chiz Escudero was supposed to have masterminded.

Congressmen also make insertions and commissions. But our senators are held to a higher bar of integrity and performance. Each senator is reckoned as presidential material. Our senators disappoint.

Senate Blue Ribbon committee chair Senate President Pro Tempore Panfilo Lacson says ‘almost all’ senators made insertions in the 2025 GAA.

We have 24 senators, so P103 billion divided by 24 is P4.29 billion (some senators, Ping says, got P10 billion). The standard senatorial ‘cut’ or commission is 25 percent. So 25 percent of P4.25 billion is P1.0725 billion. Our good hardworking senators ran away with over one billion pesos of taxpayers’ money, a single deal, in a single year. That is from flood control alone. They also made insertions in the budget of other Cabinet departments.

If stealing or malversing P8.8 million is a non-bailable crime and subject to life imprisonment and if, indeed, nearly all our senators are corrupt, then we don’t have a Senate to speak of. ‘Almost all’ of the senators should resign. Forthwith.

With ‘almost all’ senators gone, the Senate will effectively be abolished. Without a Senate, the Philippines will be left with just one legislative house, the House of Representatives. Of course, not all our 315 congressmen are thieves; only some, not ‘almost all.’ That leaves a fully functioning House.

The House has always dreamed of making constitutional amendments, without the Senate. That time has come. The House can amend the Charter forthwith.

The 1987 Constitution offers three modes:

Constituent assembly (con-ass)

Congress, the Senate and House of Representatives, not necessarily in joint session, act as a constituent assembly.

Congress can propose amendments or revisions by a vote of three-fourths of all its members.

People’s Initiative

Section 2, Article XVII, the Constitution allows amendments through a People’s Initiative.

The people can directly propose amendments to the Constitution. It requires a petition signed by at least 12 percent of the total number of registered voters, with each legislative district represented by at least three percent of its registered voters. Last year, then speaker Martin Romualdez got this done, legally, until the public got cold feet with it.

People’s Initiative can only be used for amendments, not for revisions. I suggest two: define what is a dynasty (up to fourth degree of consanguinity) in the anti-dynasty provision of the Constitution. And second, abolish the party-list system. These two amendments will be a sea change and will wash the nation into the fine earth of good governance.

Constitutional convention (con-con)

Congress may call for a constitutional convention for the purpose of proposing amendments or revisions.

A constitutional convention will consist of delegates elected by the people and tasked solely to amend the Constitution.

Congress can either call for a con-con by a two-thirds vote of all its members or submit the question of whether or not to call a con-con to the electorate for a majority vote.

While the House is doing reforms, President Marcos Jr. can cash in on the climate of reform by declaring a state of emergency.

With his commander-in-chief and emergency powers, Marcos Jr. can order the arrest of the ‘nearly all senators’ who made GAA insertions and freeze their assets and deposits. He can order the arrest of all other people involved in the P1-trillion flood-gate and freeze or seize their assets and cash.

On Sept. 25, Orly Regala Guteza, a so-called ‘Marines’ intelligence, was brought to the Senate by Sen. Rodante Marcoleta as a witness against former speaker Romualdez. He was a polluted source, to say the least.

Guteza claimed to be among a group of 90 ‘Marines’ (wow, that many?) assigned to Congressman Zaldy Co, our premier and the most corrupt contractor-politician (he got P86 billion worth of DPWH contracts). Guteza’s job as a ‘security consultant’ was to be a ‘garbage’ collector for suitcases of cash. Each Rimowa suitcase contained P48 million. One million cash is one kilo. So 48 million is 48 kilos. There is no Rimowa that can carry 48 kilos; 32 kilos is max.

Guteza claimed to have brought 46 suitcases of cash (P48 million in each Rimowa) to the 56th floor penthouse of Co in Taguig. That’s 2,288 kilos or 2.4 tons – the weight of a truck. Of the 46, 35 Rimowas were brought to the house of Romualdez on 42 McKinley, Taguig (wrong city). Having 35 suitcases with 48 kilos each is like carrying 1.85 tons – the weight of a small truck. Guteza alone carried it. Not even Tom Cruise can claim such lifting powers.

Starting 1 October 2025, the Metropolitan Cebu Water District (MCWD) will implement a 12 percent water rate adjustment, following approval from the Local Water Utilities Administration (LWUA).

For residential consumers using a ½-inch meter, the minimum charge for the first 10 cubic meters will be raised from the current P209.76 to the new ?235.60 rate.

In a statement, MCWD said that the new commodity charges are set at P26.04 per cubic meter for 11-20 cubic meters; P30.64 per cubic meter (for 21-30 cubic meters); and P75.02 per cubic meter (for consumption of 31 cubic meters and up).

Despite the increase, MCWD stressed that its potable water remains the most affordable among utilities.

‘At ?0.023 per liter, or ?0.46 for a 20-liter gallon, MCWD water is still significantly cheaper than bottled water (?25 per container), electricity (?13/kWh), mobile load (~?600/month), and internet (~?1,200/month),’ it said.

This year’s rate adjustment marks the first in 10 years, with the last one implemented in January 2015.

The water district deferred a planned 2020 increase to ease the burden on consumers during the COVID-19 pandemic, despite rising operational costs.

Since 2015, MCWD said that it has invested ?2.1 billion in expansion and rehabilitation projects and allocated ?12 billion for operations.

Major initiatives include the ?1.1-billion Lusaran Bulk Water Project, which began supplying 30,000 cubic meters of water daily in 2022 to underserved areas, such as Busay, Lahug, Apas, Pit-os, and other upland barangays.

MCWD has also started sourcing from desalination plants to mitigate drought impacts and seasonal fluctuations of supply.

In a letter dated 11 September 2025, LWUA Administrator Jose Moises Salonga confirmed the approval of MCWD’s application for a rate adjustment.

Public consultations were earlier conducted in November 2022 as part of the approval process.

Originally slated for 1 July 2023, the adjustment faced delays. LWUA initially granted a provisional 38 percent increase in March 2025 pending review, before finalizing the 12 percent hike.

As a government-owned and controlled corporation, MCWD emphasized that it operates on a non-profit, self-sustaining model, reinvesting revenues into projects to ensure reliable and safe water supply for Metro Cebu.

State-run Development Bank of the Philippines (DBP) has been recognized for its best practices in human resources management, particularly in utilizing employee engagement and organizational development in building a future-ready institution.

DBP president and CEO Michael de Jesus said the bank was conferred the Asia Best Employer Brand Award while its Human Resources Management head was named the ‘Chief Human Resources Officer of the Year’ by Mumbai-based research group Employer Branding Institute during rites held in Singapore.

‘DBP is proud to accept these awards that recognize its progressive and people-centered policies for attracting, developing, and retaining talents, and which has enabled it to further pursue its development financing mandate,’ De Jesus said.

DBP is the 10th largest bank in the country in terms of assets and provides credit support to four priority sectors of the economy – infrastructure and logistics; micro, small and medium enterprises; the environment; and social services and community development.

The Best Employer Brand Awards is an international event that recognizes organizations for their outstanding work in employer branding, with a jury composed of senior professionals from across Asia.

De Jesus said DBP was cited for its talent management, development, and recruitment strategies, as well as in strengthening the competencies of its personnel.

Likewise, DBP senior vice president Romeo Carandang was named the top chief human resources officer for the region.

According to De Jesus, the awards bestowed to DBP are also consistent with the Civil Service Commission’s efforts to highlight recognitions bestowed on government employees to acknowledge their contributions towards the improvement of public service delivery.

‘These awards, which come at an opportune time with the forthcoming celebration of the 125th Philippine Civil Service Anniversary, also affirm that our people are DBP’s greatest strength and instrumental to DBP delivering sustained value to its stakeholders,’ he said.

Bagong Henerasyon party-list Rep. Robert Nazal has urged the Department of Budget and Management (DBM) to exclude the Commission on Higher Education (CHED) from remitting cash balances and trust funds to the National Treasury.

During plenary deliberations on CHED’s proposed 2026 budget, Nazal pointed out that the Higher Education Development Fund (HEDF) still holds a balance of P11.7 billion, which he said should be used to support new grantees under the Tertiary Education Subsidy program.

While Executive Order 338, issued in 1996, requires government agencies – including state universities and colleges (SUCs) – to transfer their cash balances and trust funds to the National Treasury, Nazal argued that the HEDF is an exception.

Created by law to expand access to higher education, he said the fund was specifically intended to be maintained in a government financial institution, not the treasury.

‘There are numerous students awaiting scholarship, and we cannot afford that these funds lay idle there without any purpose because thousands of our youth are still dreaming of reaching college in their education,’ he said.

Nazal revealed that CHED owes about P12.3 billion to SUCs under the Free Tuition Fee Law, including P1.1 billion to the Polytechnic University of the Philippines.

He argued that the P11.7-billion HEDF should be tapped to finance new scholarships, while the P12.3-billion arrears must be settled immediately.

‘The law is clear: these funds should be placed in a government financial institution, nor locked in the National Treasury,’ he said.

The HEDF, with a standing balance of P11 billion, earns around P2 billion annually. If invested at five percent interest, it could yield at least P550 million a year for additional scholarships, according to Nazal.

‘If DBM insists on controlling the fund, even the interest should be spent exclusively for college scholarships,’ he added. ‘But once it is commingled with the general fund, the money is moved around and no longer serves the very students it was intended for.’

Funding demands

Meanwhile, the DBM and a group of health workers have urged Congress to act swiftly on the proposed 2026 national budget, raising concerns over rising enrollment in SUCs and underfunding in the health sector.

Budget Secretary Amenah Pangandaman reiterated the Marcos administration’s commitment to increasing education spending, particularly for SUCs, and called on lawmakers to expedite the approval process.

The proposed 2026 national budget allocates P1.224 trillion to basic and higher education – equivalent to four percent of gross domestic product (GDP) – with P134.99 billion earmarked for SUCs.

However, with SUC enrollment projected to rise from 1.97 million to 2.27 million in 2026, lawmakers warned of a potential shortfall of P3.29 billion in the Free Higher Education program.

In response, Pangandaman assured Congress that the DBM is open to adjusting allocations to ensure funding matches projected enrollment figures.

She also emphasized the government’s use of Program Convergence Budgeting to consolidate overlapping programs, maximize resources and maintain transparency.

Despite the reallocation of P255.5 billion from the Department of Public Works and Highways’ flood control budget to education and health, Pangandaman said that critical infrastructure projects, such as school buildings, hospitals and agricultural facilities, would not be affected.

Simultaneously, the Health Alliance for Democracy (HEAD) criticized the proposed P320.5-billion health budget, which amounts to only 1.23 percent of GDP – well below the World Health Organization’s recommended five percent.

The group called for an increase to at least P1.3 trillion to fulfill the government’s promise of free and quality health care.

HEAD also condemned the current budget process, citing systemic corruption tied to unprogrammed appropriations and congressional insertions allegedly benefiting political allies.

The group demanded full transparency and accountability in budget proceedings, warning that leadership changes in Congress should not be used as political cover but should lead to genuine reforms.

HEAD further called for a comprehensive public health system that guarantees free, progressive and quality services without patients having to rely on political favors or programs like the medical assistance for indigent and financially incapable patients.

‘Replacements in the Senate presidency, Congress speakership and the creation of an Independent Commission for Infrastructure should not be mere political tools to placate the growing rage and eroding public trust of the people,’ it said.

‘Actions must lead to systemic change to restore integrity, uphold accountability and genuinely serve the people,’ it added.

Schedule

The House of Representatives, under Speaker Faustino Dy III, is set to conclude plenary deliberations on the proposed 2026 national budget this week.

Oct. 10 has been designated for the period of amendments before the bill is transmitted to the Senate for further review.

Deliberations on the proposed budgets of the Office of the Vice President, along with the Departments of Social Welfare and Development, Migrant Workers, Information and Communications Technology, Labor and Employment, Interior and Local Government, Civil Service Commission and the Career Executive Service Board, are scheduled for today, Sept. 30.

On Oct. 1, the House will tackle the 2026 budget proposals of the Office of the President, the Departments of Foreign Affairs, Science and Technology and Transportation.

The same day will also cover discussions on the budgets for the Congress of the Philippines, support for government-owned and controlled corporations, lump sum funds and the turno en contra.

During yesterday’s session, the House reviewed the proposed budgets of the Departments of Public Works and Highways, Agriculture, Health and other executive offices.

Once approved by the House, the General Appropriations Bill will be sent to the Senate.

This will be followed by a bicameral conference committee to reconcile any differences before submission to the President for signing.

Lawmakers are targeting enactment before the end of the fiscal year to avoid a reenacted budget, as outlined under Paragraph 7, Section 25, Article VI of the 1987 Constitution. – Keisha Ta-asan, Rhodina Villanueva

Acting Philippine National Police (PNP) chief Lt. Gen. Jose Melencio Nartatez Jr. has ordered an investigation into allegations of abuse by Manila Police District (MPD) personnel against protesters arrested during the Sept. 21 anti-corruption demonstrations.

The Internal Affairs Service and the Human Rights Affairs Office were tasked to look into the complaints raised by rights group Karapatan, PNP public information office chief Brig. Gen. Randulf Tuaño said yesterday.

‘The PNP will never tolerate torture, physical abuse or extortion. That is the directive of our chief,’ Tuaño said at a briefing at Camp Crame.

Authorities had reported that 242 protesters, including 152 adults and 60 minors, were apprehended. Thirty minors aged 14 and below were turned over to social welfare officers and their parents.

Of those arrested, 212 were charged, according to police.

Tuaño said human rights lawyers were present when the cases were processed.

‘There were 18 lawyers representing the 212 people. That’s why the MPD said it was impossible for them to be harmed in the course of the proceedings,’ he said.

Those arrested were charged for violating the Public Assembly Act, direct assault and resistance as well as disobedience to persons in authority.

Tuaño said the PNP could easily verify the allegations of police abuse since all detainees underwent medical examinations before charges were filed.

He confirmed one fatality during the unrest, but clarified that it was not directly linked to the protest actions in Mendiola.

The victim, a 15-year-old student, died from a stab wound at the Jose R. Reyes Memorial Medical Center.

‘There was no shooting connected to the protest. Based on the report, it was a stabbing incident, not a case of police firing,’ Tuaño said.

The Kilusang Mayo Uno, however, said construction worker Eric Saber died from a gunshot to the body.

Saber was crossing Recto Avenue when he was shot by police during the riot, the militant group said.

Reducing the value-added tax (VAT) rate to 10 percent from 12 percent could cost the government roughly P330 billion annually, derail fiscal consolidation efforts and disproportionately benefit high-income earners, the Department of Finance (DOF) warned.

While the proposal to cut VAT rate to 10 percent has gained public attention, Finance Undersecretary Karlo Adriano said the reduction is equivalent to one percent of gross domestic product or around P330 billion a year on average.

‘If we have a target of 5.5 percent fiscal deficit this year, with the reduction of VAT to 10 percent, our fiscal deficit will be at 6.5 percent. So definitely, we will not be able to do fiscal consolidation because our fiscal deficit last year was only 5.7 percent,’ Adriano said.

Adriano warned that a wider deficit could weaken the country’s creditworthiness and raise borrowing costs.

‘If we cannot show that we are capable of fiscal consolidation, what will happen? Interest payments will also increase because our credit rating will be lower. When it gets worse, all our debts will increase. And that’s a cycle of more debt,’ he said.

To offset the lost revenues, the government would either have to slash expenditures by the same amount, around P330 billion a year.

‘That means less government programs of around P330 billion every year. So those are the things that need to be considered given this proposal,’ he said.

Adriano also pushed back against the notion that the VAT system is regressive.

According to Adriano, all income groups pay the same percent, citing numerous exemptions such as those on food, which accounts for about half of the spending of the poorest households.

Because the poor already spend mostly on VAT-exempt goods, a rate cut would largely benefit high-income earners.

‘If we actually decrease the VAT rate, the ones who will benefit the most are the high-income (earners) because they are the largest consumers,’ Adriano said.

Adriano also acknowledged the struggles of middle-income earners who are not poor enough to qualify for subsidies but are burdened by rising costs.

While the personal income tax system is already progressive, he underscored the need for more efficient government spending to free up resources for programs that could assist the middle class. He cited leakages in social aid programs, including free college tuition, which sometimes benefit wealthier families.

‘As much as possible, the high-income classes don’t need a single peso. Channel all this peso that the high-income classes receive to the middle-income,’ he said, adding that conditional cash transfers have proven effective in reducing poverty and should remain targeted.

The DOF official also discussed other tax-related measures, including the extension of the estate tax amnesty, which Congress recently moved to prolong until 2030.

Adriano said this would be the third extension since the measure was first introduced under the Tax Reform for Acceleration and Inclusion (TRAIN) law in 2019.

‘It was extended the first time because of COVID. and then I believe it was extended again because there are many people who still want to avail of the amnesty,’ he explained.

On the proposed 12 percent VAT on digital service providers (DSP) such as Netflix and Spotify, Adriano said the levy could generate around P35 billion annually, though this is a conservative estimate.

More importantly, he said the measure is intended ‘to level the playing field between local DSPs and foreign DSPs,’ since domestic providers are already subject to VAT.

The government is committed to cracking down on corruption and reducing red tape, which the United States cited as impediments to the Philippines’ efforts to attract foreign investments.

Trade Secretary Cristina Roque told The STAR yesterday that the government is committed to fighting corruption to clean up the system and restore public trust, acknowledging that recent corruption issues exposed in flood control projects undermine reforms aimed at boosting investor confidence.

In this light, the Department of Trade and Industry (DTI) sees the creation of the Independent Commission for Infrastructure as a major step in uncovering the misuse of public funds and ensuring accountability.

The DTI is also doing its part to help build a government that the public can trust.

‘We believe that honest and transparent service is key to earning the trust of our people and our business community. That’s why we’re going digital, cutting red tape and making sure our processes are clear and fair,’ Roque said in a Viber message.

Roque’s comments were made following the release of the US Department of State’s 2025 Investment Climate Statement on the Philippines, which cited challenges faced in attracting foreign investments, as well as recent moves to improve the overall investment climate and promote economic growth.

According to the report, the Philippines’ efforts to attract foreign investments have been hampered by corruption, poor infrastructure, high power and logistics costs, regulatory inconsistencies and a cumbersome bureaucracy.

‘Corruption is a pervasive and long-standing problem in both the public and private sector,’ the report said.

It also highlighted the lack of progress in addressing corruption since 2019, with the Philippines placing 114th out of 180 countries in Transparency International’s 2024 Corruption Perceptions Index.

In addition, the report said various organizations, including the World Economic Forum, have cited corruption among the top problematic factors for doing business in the Philippines, with the Bureau of Customs still considered as one of the most corrupt agencies.

‘The Philippines’ complex, slow, redundant and sometimes corrupt judicial system inhibits the timely and fair resolution of commercial disputes,’ the report said.

The traffic in major cities and congestion in the ports was also cited as barriers to doing business.

‘While the Philippine bureaucracy can be slow and opaque, the business environment has been better in special economic zones,’ the report said.

The report said recent reforms aimed at attracting new investors were also put in place, such as the CREATE MORE Act, which expanded incentives.

The law extended the period for tax exemptions up to 27 years, clarified value-added tax zero-rating rules and streamlined local tax policies.

American Chamber of Commerce of the Philippines executive director Ebb Hinchliffe said in a Viber message that the US report reflects investors’ top concerns.

While investors are encouraged by recent reforms such as the CREATE MORE, Ease of Paying Taxes Law and the executive order on green lanes for streamlined processing of permits, he said businesses are pushing for other measures to strengthen the country’s investment climate.

‘We continue to advocate for structural reforms that promote transparency and business efficiency. These include the passage of the Freedom of Information Act, National Single Window System Act and amendments to the Bank Secrecy and Electric Power Industry Reform Acts,’ Hinchliffe said.

According to Hinchliffe, streamlining travel requirements for foreign tourists and reviewing Revenue Memorandum Circular 5-2024, which covers the tax treatment of cross-border services, are also critical steps to boost investor confidence and position the Philippines as a competitive destination for global investment.

‘Equally important is the consistent implementation of existing laws such as the Ease of Doing Business Act and CREATE MORE,’ he said.

Despite a quick turnaround and rain stoppages, Alex Eala is heading to the next round of the Suzhou WTA 125 tournament in China after outlasting Poland’s Katarzyna Kawa, 6-3, 3-6, 7-5, in their rain-delayed match Tuesday.

Eala, who exited the Jingshan Tennis Open this weekend, just had a few days’ rest before heading to Suzhou.

Their match was likewise suspended twice due to rain.

But the World No. 58 tennister asserted her mastery over the 124th-ranked Kawa.

The first stoppage came in the first set, with the two players tied at 2-all.

When play resumed, the Filipina grabbed the first set, 6-3.

Kawa, though, tied things up in the second set despite another stoppage.

But in the third set, Eala took a slight separation, going up 3-1.

The 32-year-old from Poland, however, won the next three games to go up 4-3.

But Eala did not yield, winning four of the next five games to grab the victory.

Kawa banked on her receiving game, winning 51 points against Eala’s 44. The latter, however, won 51 service points to the former’s 42.

The Pole also committed 11 double faults, which basically offset her three service aces.

Eala will now take on Greet Minnen in the next round. The Belgian player, ranked 106th in the world, defeated hometown bet Han Shi earlier in the day.

The 20-year-old pride of the Philippines will try to win her second WTA 125 championship after her breakthrough title in Guadalajara earlier this month.

Justice Secretary Jesus Crispin Remulla on Monday described the alleged schemes of contractors Curlee and Sarah Discaya as a ‘unique experience,’ describing the unprecedented scope of their operations in public works projects nationwide.

Remulla said the couple’s contracting practices stand out because they secured projects across the country, defying the usual ‘territoriality principle’ in government contracting.

‘Walang katulad na contractor itong mga Discaya. They’re a very unique one,’ Remulla told reporters on Sept. 29. (The Discayas are contractors unlike any other. They are very unique.)

Remulla explained that under standard practice, contractors typically operate within designated geographic areas. The Discayas, however, ‘hustled their way’ into projects nationwide, lending out their licenses across multiple territories.

Citing testimony from former Public Works undersecretary Roberto Bernardo, Remulla said the couple’s projects often bypassed competitive bidding, in violation of the Philippine Competition Act, the Anti-Graft Law and other statutes.

Because of this, investigators are backtracking records from 2025 down to 2016 – the period when the couple allegedly ‘got big.’

‘They started contracting in 2007, but they were a struggling group at that time. But in 2016, they got big. That’s why we started zeroing in on how they got big,’ Remulla said.

‘Beyond imagination’

Remulla agreed with Sen. Panfilo Lacson’s earlier claim that the couple bagged at least P207 billion worth of projects but suggested the figure could be even higher.

‘I believe that. But probably it’s bigger,’ Remulla said.

Remulla said the scale of alleged corruption linked to the Discayas was ‘beyond imagination.’

The Discayas, who have testified in congressional probes, are currently considered protected witnesses. The DOJ is evaluating whether they qualify as state witnesses, which would grant them immunity from prosecution.

Remulla said lawmakers named by the couple, along with former Department of Public Works and Highways (DPWH) officials, will soon be invited by the DOJ to validate the information.

Billions in contracts. From 2022 to 2024, companies linked to the Discayas secured around 421 projects worth P31.04 billion, most of them flood-control works.

Their own firms accounted for P25.2 billion across 345 solo and joint projects, with affiliated companies raising the total contract value to more than P31 billion.

The operator of the country’s largest railway project will receive a uniform rate based on performance and may be granted a concession lasting up to 22.5 years, according to the Department of Transportation.

The DOTr has designated availability payments as the bid parameter for the P229-billion contract to manage the North-South Commuter Railway (NSCR), the country’s largest infrastructure investment to date.

Acting Transportation Secretary Giovanni Lopez said the concessionaire may get up to 22.5 years of tenure, including partial operations, in running the NSCR.

‘The approved contract period is for the pre-operations, partial operations, (plus) 15 years of full operations, for a maximum 22.5 years. Extension was not part of the approved parameters, terms and conditions for the project,’ Lopez told The STAR.

In using availability payments as the bid parameter, the DOTr will be assessing what investments bidders can commit based on predetermined fees.

This means the concessionaire will get paid regularly not from fares collected from passengers, but from budget allocated to the DOTr.

Bangkok-based consultancy Mahanakorn Partners Group said public-private partnerships (PPPs) with availability payments compel concessionaires to perform better to receive compensation.

Since PPPs are long-term, Mahanakorn said availability payments also provide the government with a predictable schedule for its budgetary obligations.

This is different from the PPP model for the Light Rail Transit Line 1 (LRT-1), the concession of which was awarded to the Light Rail Manila Corp.

LRMC recovers its investment capital for the operations and maintenance of the LRT-1 through passenger fares, which are scheduled to increase every two years.

However, this has caused legal troubles for the government, as it denied fare hikes filed by LRMC multiple times.

Prior to the recent fare adjustment in April, LRMC had piled up a deficit of P2.17 billion dating back to its first petition in 2016. Despite this, the operator has delivered on its commitments, including the ongoing extension works for the LRT-1.

China Bank Capital Corp. managing director Juan Paolo Colet expects foreign multinationals to vie for the operations and maintenance of the NSCR after the DOTr conducted roadshows in Singapore, Paris, Manila and Tokyo.

However, Colet warned that some investors may be discouraged to bid for a project as big as the NSCR in light of corruption scandals hounding public works, particularly flood control.

In August, President Marcos exposed that 15 contractors have bagged almost 20 percent, or P100 billion, of the P545 billion worth of flood control projects since 2022.

‘The long-term nature of this project means potential concessionaires would have to take a long view of our country, including our economic prospects and political dynamics. Hopefully, by the time the government launches its bidding, there would have been a clear resolution to the current corruption scandals,’ Colet told The STAR.

Rizal Commercial Banking Corp. chief economist Michael Ricafort underscored the importance of fair play in the concession. Given the length of the deal, bidders would prefer that rules are all set in stone and mechanisms are in place for dispute settlement.

‘It is important to not have changing rules in the middle of the game in view of the six-year term of presidents and their administrations,’ Ricafort told The STAR.

The NSCR, costing P873.6 billion and co-funded by Japan, will run for 147 kilometers across 35 stations in three regions, and it is expected to ferry 800,000 passengers daily once completed.

The future concessionaire of the NSCR will be tasked to operate and maintain its trains, stations and depot, including its interoperations with the Metro Manila Subway Project.