Gov’t speeds up infrastructure decisions

THE DUTERTE ADMINISTRATION is putting flesh on its vow to hike infrastructure spending in order to sustain the country’s economic expansion, this time putting in place structures to speed up top-level approval of such projects, the Socioeconomic Planning chief said yesterday.

The proposed P3.35- trillion 2017 national budget the Executive submitted to Congress on Aug. 16 — which is 11.6% more than the P3.002 trillion approved for 2016 — earmarks P860.7 billion for public infrastructure ( equivalent to 5.4% of gross domestic product, or GDP) that is 13.79% more than this year’s P756.4 billion (5.1% of GDP).

Briefing reporters in Malacañan Palace on accomplishments of the National Economic and Development Authority (NEDA) in the first 50 days from President Rodrigo R. Duterte’s assumption of office on June 30, NEDA Director- General Ernesto M. Pernia said moves to speed up approval of large- scale infrastructure projects deemed vital to expansion of economic activity are led by reactivation of the Legislative- Executive Development Advisory Council (LEDAC) that had lain dormant throughout the six years of the previous administration as well as raising the minimum cost and reducing the social discount rate of projects that require NEDA approval.

“[ W] e are revitalizing and getting that active again. The LEDAC is scheduled to convene in September or October…” Mr. Pernia said of the body led by the President and which consists of key officials from the Executive branch and Congress, as well as select local government, private sector and youth sector leaders.

The LEDAC had been instrumental particularly in the administrations of former presi- dents Fidel V. Ramos and Gloria Macapagal-Arroyo in facilitating enactment of measures deemed vital to development. Former president Benigno S. C. Aquino III had said early in his term that he would convene the body, but never did.

Mr. Pernia yesterday enumerated measures to be submitted for

LEDAC consideration as:

• establishment of a Water Resources department or authority;

• creation of an independent economic and financial regulator for the water sector;

• adoption of a national transport policy that will help coordinate various transport projects across provinces;

• amendments to Republic Act No. (RA) 7718 or the build-operatetransfer law and its implementing rules and regulations to facilitate solution of right-of-way, procurement and other obstacles to project implementation;

• as well as amendments to the RA 9136, or the Electric Power Industry Reform Act of 2001, and RA 1067, or the Water Code of the Philippines that governs the use and ownership of water in the country.

The Socioeconomic Planning chief also announced that the minimum cost of projects requiring NEDA approval has been raised to P5 billion from P1 billion, “meaning that projects below five billion can go faster.”

“It [ a project below that threshold] doesn’t have to go through the entire process of hurdling the ICC ( Investment Coordination Committee) and the NEDA Board,” he explained.

Moreover, NEDA cut the social discount rate — the interest rate used in cost-benefit analyses of public projects to determine whether they are acceptable — from 15%, “which is pretty high by today’s interest regime”, to 10% “so that should also speed up project approval…”

The NEDA chief added that “other reform initiatives… are currently proposed to fast-track appraisal and approval process while still ensuring quality of infrastructure projects.”

BUILDING ON PAST GAINS

“[ W]e are carrying on with the macroeconomic policies of the previous administration, but ramping up infrastructure spending, promoting regional and rural development and investing heavily in human capital development which includes health and education and nutrition,” Mr. Pernia said.

“[ W]e have moved quickly to implement reforms to accelerate infrastructure development which has been rather slow in the previous administration.”

He noted that since the Duterte administration took office last June 30, NEDA’s ICC had approved by Aug. 2 10 projects cumulatively worth P320 billion and that the agency’s Board — led by the President — will consider them for final approval in its meeting next month.

This list includes the P170.7billion south line of the NorthSouth Railway and the Metro Manila Bus Rapid Transit Project on EDSA, as well as rural development projects involving irrigation, farm-to-market roads, school buildings in depressed areas, regional hospitals, airport modernization and flood management.

NEDA’s Infrastructure Committee (InfraCom) has also prioritized completion of the initial phase of the Mindanao Railway Project that will be implemented in 2017, once approved by the NEDA Board this year.

InfraCom has also identified various measures to ease Metro Manila’s worsening traffic, including the Bonifacio Global City- Ortigas Link Bridge that is expected to divert 25% of EDSA traffic.

Mr. Pernia noted further the impending resolution of the project deadlock over the site for a common station for three converging Metro Manila railways — Light Rail Transit 1 as well as Metro Rail Transit lines 3 and 7 — that has been blamed on “controversies in the previous administration” which has been perceived to be siding with one of the contending proponents.

InfraCom, Mr. Pernia added, has also urged the use of the ports of Batangas and Subic Bay Freeport to help decongest Manila’s ports.