MANILA, Philippines - The government wants to take full control of the Metro Rail Transit Line 3 (MRT-3) before bidding out the system's operation and maintenance (O&M) under the Aquino government's public-private partnership program.
"We want to buy everything and make it fully government-owned," Transportation Secretary Joseph Emilio Abaya said in his first briefing as DOTC chief.
The plan to buy out the private sector's stake in the MRT-3 will also mean the government will no longer need to pay the Metro Rail Transit Corp. (MRTC) huge fees every year.
In 2010, the DOTC paid a total of P7.87 billion to the MRTC, the consortium that built the system, as part of their Build-Lease-Transfer deal. The payment was comprised of equity rental payments (P5.29 billion); maintenance cost (P1.18 billion); debt guaranteed payment (P1.15 billion); insurance expenses (P207 million); and other fees and costs (P34 million).
The government, through the Land Bank of the Philippines and the Development Bank of the Philippines, already owns 80% of MRT-3's economic interests. However, Abaya noted that the private sector, despite holding the remaining 20% of economic interests, has more voting rights than the government.
"Despite government having 80 percent economic or beneficial interest in MRT-3, there is an irregularity because the decision making policy was left with the private sector. The irregular thing is that Land Bank and DBP mainly bought the economic interests of MRTC without getting or acquiring the more important political rights which is the voting and decision making rights," Abaya explained.
"We want to make everything now in the hands of the government meaning all decisions will emanate from policies of government rather than dealing with private interests," he stressed.
Abaya said the proposal to take full control of the MRT-3 has already been presented to President Benigno Aquino III and some cabinet members.
"The only issue that was raised by former DOTC secretary Mar Roxas is that the buy-out might tend to give a white wash of the sins of the past. We will make sure that it won't happen again," Abaya said.
For now, Abaya said his agency will be coordinating with the Department of Finance (DoF) to finalize the de-privatization option that government is mulling, although he noted there is currently no timeframe for the proposal.
"After doing this (taking full control of MRT-3), probably we will still end up doing a PPP on the operation and maintenance of MRT3," Abaya said.
Businessman Manuel V. Pangilinan's Metro Pacific Investments Corp. in 2011 has submitted a $300-million proposal to expand the capacity of the MRT-3. This was countered earlier this year by another proposal from Ramon S. Ang's San Miguel Corp