Government confident of reducing corruption in infrastructure projects

THE DEPARTMENT of Finance (DoF) said the government is confident that its big-ticket infrastructure projects will be completed as scheduled with minimal corruption.

The DoF said in a statement that Secretary Carlos G. Dominguez III, told ASEAN finance ministers and central bank governors on April 5 in Singapore that “we have managed to reduce corruption to the barest minimum in all our government efforts. We have started the projects.”

“The projects are going quickly, and we are very, very confident that they are going to be completed on time with no corruption,” he added.

Asked about the procedures for reducing corruption, Mr. Dominguez said the government required “contractors of China-funded Projects to be officially endorsed by the government of China.” He added that other measures focused on project monitoring and preparation.

In January, the Asian Development Bank and the government established the Infrastructure Preparation and Innovation Facility (IPIF), which brings in experts to support implementing agencies in preparing their feasibility studies, detailed engineering design, bid document preparation, and due diligence review, among others.

Mr. Dominguez also noted that initiating projects with government funding and official development assistance (ODA) accelerated implementation compared to projects implemented purely via Public Private Partnerships (PPP). The latter method, he said, takes up ”too much time” in negotiating contracts, deciding on cost recovery issues and resolving legal disputes among contesting private bidders.

He added financing projects via bond issues also “speeds up project execution, reduces completion risk and delivers the economic benefits to the people as soon as possible.”

Mr. Dominguez cited as examples of work making good progress the P9.3-billion Clark International Airport Expansion project and the first phase of the Metro Manila subway.

However, the DoF said that it has not ruled out PPPs entirely, as it remains open to unsolicited proposals, as long as private firms introduce new technology to the project, and do not require direct government guarantees.

President Rodrigo R. Duterte in January said that the government will focus on unsolicited proposals subject to Swiss challenge for private procurement to sidestep the public bidding process, which he said was prone to corruption.

The Swiss challenge system subjects unsolicited project proposals from the private sector to a counter- offer process, with the original proponent having the option to top the counter-bid.

The government plans to spend some P8.4 trillion to boost economic growth to 7-8% this year until the end of its term from the 6.3% average growth rate in 2010-2015 and the 6.7% logged in 2017.