The DOTC Is Very Confident For MRT3 Equity Buyout? #ViralInternetLinks
What will happen now that the DOTC Secretary is very much confident about the MRT3 buyout? That the 2015 budget will be used for this purpose?
Last, September 2014, the DOTC Secretary spread the word with finality and conviction. He answered all the queries that the Filipino people, media, and politically inclined individuals; even though train breakdowns are making negative image to the present administration.
Even MRTC’s Bob Sobrepena opened up to the media about the true status of MRT Holdings and the DOTC. Secretary Jun Abaya defended his decision-making techniques why he has done such actions.
The DOTC is acting to the best of his knowledge but in fact he’s applying the delaying tactics until the budget for 2015 will be approved. As such, he could buy the remaining bonds to its private counterpart. Likewise, the completion of MRT3 ownership is needed for upgrading the development of MRT3-EDSA. Thus, the operations and management will be only for the government. But for the government, the acquisition budget is the rightful price for the takeover, as computed through the formula provided in the 25-year build-lease-transfer (BLT) contract.
The The Department of Transportation and Communications (DOTC) Secretay Jun Abaya has higher confidence to say, “There is a fixed formula in the BLT, which also provides how to execute the buyout; so there is no room for negotiations. We are buying everything out, including the bonds and the remaining equity interest in private hands. The objective, at the end of the day, is for the government to own 100 percent of the MRT3 line.
MRTC is owned by MRT Holdings II Inc., which, in turn, is owned by MRT Holdings Inc. The government, meanwhile, holds an 80-percent economic interest in MRTC, by virtue of the bonds that the state bought from the private concessionaire.
So, the DOTC Secretary’s playing the game of chance when he totally spread the word of MRT3 buyout. Is he actually sincere of this buyout, or his intention - to buy the remaining bonds from the 2015 budget? The implementation of the equity value buyout (EVBO) of Metro Rail Transit Corp. (MRTC) could start in the first week of January, with the House of Representatives set to approve the P53.9-billion budget for the government’s takeover within the month.
But to effectiveness of the buyout, the government and MRT Corp. (MRTC), the private concessionaire of the train system, must enter into a compromise agreement first. But, through the compromise agreement with the MRTC, the DOTC should initiate such meeting to put forward of this plans. Entering into a compromise contract would effectively end the ongoing arbitration case in Singapore. The case was lodged against the government in 2008 due to its failure, as the operator of the line, to pay billions of rentals payment to the owner of the rail system.
However, the DOTC and MRTC must agree with the terms of the acquisition, which includes the price of the takeover.
How about if the MRTC will not approve for this buyout? Is there another story for the DOTC’s side?
As always, let’s wait and see.
MRT3 Shutdown Is Feasible or Not? #ViralInternetLinks
To ease passengers' suffering caused by recurring breakdowns of the Metro Rail Transit 3 (MRT3), its key stakeholders are in agreement over a possible temporary shutdown of the line. The DOTC should initiate quick plans and moves to put forward the MRT temporary shutdown. I am in favor for this shutdown than carrying loads of problems may incur at the present situation. Talks and agreements should be formalized between the MRTC, DOTC and MRT II Holdings.
It’s a fact that both parties should follow the Buy-Lease-Transfer (BLT) Agreement to the best of their knowledge and capabilities to enhance the MRT3 renovation and development; depending on the initiatives of both parties to compromise the agreement in which every facet of works and management for the temporary MRT3 shutdown. Their prowess and resources should unify for the good of the common citizens.
The The Department of Transportation and Communications (DOTC) Secretary Joseph Emilio Abaya had said the management of MRT3 hasn't endorsed a shutdown of its operations despite a series of breakdowns in recent weeks.
Lately, the government has pushed back the bidding for the maintenance contract of the MRT3. In a general bid bulletin, the Department of Transportation and Communications (DOTC) said the deadline for the submission and opening bids for the P2.2-billion three-year contract has been deferred to October 28. The deadline originally fell on October 17. The agency said the extension aims to allow prospective bidders to prepare competitive tenders. The DOTC did not identify the potential bidders.
At the present situation wherein, the maintenance provider APT Global must be hired until the bidding process is over.
Nevertheless, sustainable program is required in pursuing the plan of renovation. Likewise, all concerned people for this endeavor should devout their precious time, energy and know-how to finish on time. Every angle of MRT3 operations and management should be planned and study very carefully to avoid mistakes, even projecting ahead of 10 years at most.
While breakdowns are showing the APT Global must do their best to eliminate such damage until the new maintenance provider is selected. There’s nothing wrong if the DOTC should initiate the operation of MRT3 at present, but it’s a must to talk it over to MRTC’s Manager Bob Sobrepena. The whole process maybe short of some minor things but at the end of the day, the relationship is sealed slowly.
There are more things to reconsider by the DOTC to put forward the total service to the riding public. In fact, MRTCs businessmen are opening up their desire to support this MRT3 problem and until the development phase. Only that, the DOTC Secretary is not keen with his decision-making strategy in giving enough thoughts beforehand. He bolted such arguments in Senate hearing that the past negotiation is a failure.
Again, I am with the MRT3 shutdown as long as conflict should be compromised by both parties. It should drive the Filipinos to respect their governance when leaders show their capabilities in giving solution with dignity for the common good. It’s not for them to apply their personal interest but to lead by their good intention to serve the country and its people.
MRT3 Senate Hearing: Will Problems Be Solved? #ViralInternetLinks
What will be the outcome of the latest senate hearing wherein the DOTC and MRTC are spreading the truth? Will it give positive result for the riding public or another battle is coming?
The senators present in the hearing know how to throw punches to the DOTC Secretary Emilio Abaya with a twists. It’s a questioning that makes Jun Abaya releases his ever-ready answers; defending his stature that always been amazingly correct. Is he telling the truth?
If The Department of Transportation and Communications (DOTC) Secretary Jun Abaya had done his part excellently last 2012, wherein he terminated the contract of Sumitomo Corporation – the maintenance provider of MRT3 train system – maybe, train breakdowns are not possible today. And because Sumitomo increased its service rates from $1.4 million a month to $2 million, prompting DOTC to terminate deal with the Japanese contractor.
Likewise, because of this contract termination and a quickie action to engage PH Trams as maintenance provider of MRT3, it makes the problem comes closer to a more train system breakdowns until now under APT Global.
At the senate hearing, MRTC’s Bob Sobrepeña pointed out those problems only arose after the DOTC terminated the contract and Sumitomo had a "single point responsibility" to design, build, and maintain the trains. The Sumitomo handled everything including parts and service. Nothing else has to be bought by the government or the private sector. He defended the company, saying Sumitomo really needed additional funds to overhaul the trains.
MRTC repeatedly proposed the procurement of new trains as early as 1999, but the government failed to act on its proposals. The last proposal to the government was in 2007, but since all of these were not acted upon, we reiterated another proposal to provide 48 cars, capacity expansion, upgrade of the MRT-3 system, in 2007. At this year, the DOTC began to question us as to why we were buying new cars. The Department of Transportation and Communications had begun to request for second-hand trains, instead of new ones. MRTC do not approve for the second hand coaches for the reason of incompatibility.
The Senate hearing was prompted by various resolutions seeking shed light on why train breakdowns are more pronounced as months passed by. The truth came out through MRTC Bob Sobrepena’s when asked about the status of MRT3. He deliberately told the senators that DOTC was violating the Build-Lease-Transfer (BLT) Agreement that the MRT Holdings filed an arbitration case in Singapore.
The latest news at present is that MRT3-EDSA will be closed for renovation of the whole train system. The works must be done daily with 100% workers participation. While engineering and maintenance people will put forward for this purpose.
The DOTC and MRTC must jointly provide help with this plan to uplift the MRT3 train system for the good of the riding public. Maybe, this is the time that the fare will increase to augment with the new development. Moreover, this can be applied, but there are still Filipinos who will not approve for this plan. So, the riding public will use buses as their temporary transportation along EDSA.
Government will find solutions for MRT3 because “for the good of the riding public,” but, if MRTC has other interest and won’t cooperate for this plan?
Let’s wait and see for the continuation of the MRT3 story.
Blaming each other is not an option for DOTC and MRTC in giving services to the public through the MRT3 train system along EDSA. Likewise, corruption of public officials is not the primary mission in leading the Philippine government.
Majority of Filipinos knows the strategies of some politicians who only valued their vested interest while doing their job in the government. They molded their lives through dealing negatively because of the huge amount of money involves.
There’s a saying that, “Chaos gives bad people to live invisibly or saintly.” For sure, they wanted that way to juggle their ambitions and personalities direct to Hell.
Let’s take a look the case of never-ending chaos brought about by this MRT3 Project along EDSA. The PPP movement is not working here wherein squabbling over the Maintenance and Operation didn’t give positive result to the riding public. It’s really a problematic notion that privatization cannot pursue the course because of public intervention. The MRT3 was originally tasked to MRTC, of course the maintenance of MRT3; the DOTC, over the objections of MRTC, took over the maintenance of MRT3 by selecting, appointing and contracting with its preferred maintenance contractor/s, PH Trams-CB&T and Global-APT, from 2012 onwards.
A recent statement of the MRTC Board indicate that DOTC officials have been lying through their teeth in unduly blaming its private partner for this train system’s fiasco and hiding the fact that this department took over the MRT3 maintenance in 2012. MRTC has written Department of Transportation and Communications (DOTC) numerous letters about the resulting problems in the operations of MRT3 and demanded an explanation from DOTC. The DOTC has not answered any of those letters. But wasn’t it DOTC which took over the maintenance work in 2012 after dumping longtime contractor Sumitomo and “requested” MRTC to surrender its job of selecting the O&M service provider, after which DOTC awarded an interim contract to an unqualified and undercapitalized company through a negotiated arrangement instead of the mandatory public bidding?
DOTC has totally shut out MRTC from the business of selecting and overseeing the work of MRT3’s O&M operators since 2012, when it surprisingly dumped the train system’s longtime maintenance provider TESP-P/Sumitomo Corp. of Japan in favor of PH Trams-CB&T and, later, APT Global. MRT3’s dismal service started only when PH Trams-CB&T and then APT Global took over from Sumitomo as O&M operators.
MRTC and its mother firm MRT Holdings (MRTH) have actually submitted five capacity-expansion proposals to acquire additional LRVs from the time the DOTC and MRTC sealed their build-lease-transfer agreement in 1999.
DOTC has been accused of violating the original 1999 BLT a number of times. One instance was when it chose PH Trams-CB&T and APT Global as O&M operators along with Dalian Locomotive as LRV supplier, all without prior review and consent from MRTC as provided in the accord. The second one involved non-payment of economic rental payments (ERPs) plus staffing and administrative costs to MRTC, as well as real property taxes (RPT) to host-local government units (LGUs).
MRTC has repeatedly informed the DOTC of its readiness and willingness to purchase additional trains, has told the DOTC of its readiness and willingness to procure the O&M contract after the 2012 expiration of Sumitomo’s contract, has cited the need for a technical audit by an independent third party to assess the safety of the train system; has suggested improvements in the Terms of Reference (TOR) of the O&M contracts awarded to the interim maintenance providers to safeguard the government and riders against foul-ups; and has alerted the DOTC to problems cited by then-outgoing contractor Sumitomo, such as passenger overload and the shortage of spare parts for the train signaling and automated ticket-collection systems, to no avail.
Now we know why DOTC is only now thinking of suing MRTC after years of neglect they are blaming the owner for. It will backfire on them and the true incompetent will be exposed. And here they come claiming they will rescue us by taking over the MRT3. It's all posturing because while they have the money to buy out the government shares that will leave nothing left for private shareholders.
And DOTC executives have to think carefully their plan to sue MRTC. After all, seven of the 11 member members of the board are government officials which means, that government is running the show. Most of the board directors come from Development Bank of the Philippines and the Land Bank of the Philippines, with an LBP director as chairman-president, because these state-run banks own a combined 80-percent economic interest in MRTC.
We should always defend people who manage the Philippine resources and extend total services for the good of all Filipinos. The political arena is not a milking cow for politicians. We should erase the bad elements in the political system and penalize people who are not serving our country. They only survive in getting wealth through government contracts.
We cannot achieve development until these dirty politicians and corruptions are removed from our political system. The past gave much misery to Filipino people; it’s our turn to straighten up for good of the majority.
