House leaders push review of PIATCO deal

The House committee on good government is sharply divided in its report over its investigation of the government-Philippine International Air Terminals Co. (PIATCO) contract, but two key officials of the panel have found the deal highly disadvantageous and harmful to the Philippine government and the people.

Rep. Salacnib Baterina, senior vice chairman of the committee, said: "I feel there was a violation of the law, the Build-Operate-Transfer (BOT) law, and the Constitution."

Earlier, Rep. Antonio Abaya, who is also vice-chairman of the committee, called for a renegotiation of the contract because of several onerous provisions. He urged more transparency in the renegotiation to avoid the insertion of questionable provisions in the agreement.

Baterina, who will be submitting a separate report endorsed by several committee members, stressed that there is a need to review the contract and renegotiate it if needed.

He said the Amended and Restated Concession Agreement (ARCA) signed on Nov. 12, 1998 was not really an amended and restated agreement since it was totally new. The original agreement was signed by the government and PIATCO on July 12, 1997.

"It’s no more a restated contract since it is actually new with the many (disadvantageous) provisions added," Baterina said.

He emphasized that the ARCA has given PIATCO so many concessions that put the country and people at a disadvantage and that "there’s no stopping them from making more changes."

Service operators at Ninoy Aquino International Airport (NAIA) have protested the existence of several onerous provisions in the deal, two of which will result in the closure of businesses in the airport not allied with PIATCO and the retrenchment of more than 10,000 workers.

They revealed that PIATCO was able to obtain several favorable amendments to the contract through the use of money channeled through a certain Alfonso Liongson. Liongson was paid a monthly fee of $200,000 or P10 million, mobilization fee of $200,000 or P10 million, plus millions of pesos in so-called "milestone fees" if he is able to obtain amendments to the contract.

Documents obtained showed that he was able to obtain two amendments to the contract and was paid $800,000 or P40 million by PIATCO. One amendment was the change in the name of PIATCO’s contractor-operator from Philippine Airport and Ground Services, Inc. (PAGS) to Philippine Terminals, Inc. (PTI) in which Liongson was paid $600,000 or P30 million.

The other amendment was the third supplement to the ARCA that would allow PIATCO to construct access roads between Terminals 2 and 3 but for which the government would be billed later. Liongson was paid $200,000 or P10 million for the effort.