Fixing a national shame

Our international airport in Metro Manila has been a constant source of embarrassment and annoyance for many Filipinos over the past years. It is a national shame that captures all that is bad about the Filipino’s present condition.

It has been abused by politicians and their cronies who have been milking it at the expense of the airport’s proper operations. The airport had been badly managed but no previous President had the inclination to deal with it.

Finally, we have a President willing to admit failure in NAIA management and fast tracked a public bidding for a private group to take over. NAIA operations had to be privatized for anything good to happen.

The San Miguel Corp.-led New NAIA Infra Corp. (NNIC) that won the bid has made an upfront payment of P30 billion for the right to redevelop NAIA as a public-private partnership (PPP) project. San Miguel will also provide a fixed P2 billion annual payment and 82.16 percent national government revenue share, excluding passenger service charges.

According to Finance Secretary Ralph Recto, “the government is expected to generate roughly P900 billion in revenues from this deal over the entire term, which is a 15-year concession period, extendable by another 10 years. This will be equivalent to a revenue source of more or less P36 billion annually.”

Question is, if the airport can deliver all that revenue under private management, why was the government unable to do so all these past years?

Before privatization, the Manila International Airport Authority only sent about P2 billion yearly as dividends to the national government.

Privatization will make it possible to extract revenue sources that were neglected or lost by government mismanagement. The revenue leakage is humongous.

But a PPP project (like NAIA, Manila/Maynilad Water or the tollways) means the government has abandoned its obligation to provide those services.

That means we, the citizens, must pay again on top of the taxes we already paid if we want more efficient service. The sad thing is, PPP means there will be more money that our corrupt officials can steal from us, which is now estimated to be as high as 70 percent of project costs.

Fixing our national shame of an airport seems like mission impossible and there are those making it more so.

The first order of business is to reduce congestion in the terminals. This is something the new management wants to do before the Christmas rush. But for some reason, one airline with the most number of passengers wants to delay any move to another terminal that will help decongest the airport.

The airline claims they were given 12 months to transfer terminals in Singapore. But the case here is different because we are all eager to see quick signs of positive change with the new management.

I understand all the foreign airlines are amenable to the change in terminals and so is Philippine Airlines whose international and domestic flights are being consolidated at Terminal 1.

The budget airline is also questioning the new landing and take-off fees. They claimed they were surprised. But their holding company is part of a losing consortium in the bid. They, San Miguel and the other bidders, used the same terms of reference prepared by the Asian Development Bank.

It is unbelievable the airline’s holding company didn’t look with interest at the numbers since they own an airline. If their consortium won the bid, they would be charging the same rates.

As far as the new airport management is concerned, they will focus on some basics first. The parking issue was on top because it was a key cause of traffic jams around T3. While short term parking rate was minimally adjusted to P50 from P40, at par with most mall rates, the overnight parking was significantly increased to discourage non airport users from nearby condos and commercial establishments from abusing a very low rate. The goal is to open up more parking spaces for passengers whose cars, unable to park, would have to circle the airport area and add to traffic congestion while waiting for arrivals.

To address traffic flow in T3, they are adding six lanes in the arrival area. Even departing passengers can use those arrival lanes so they can easily go up to the departure gates. There is only space for one lane expansion in the departure area.

San Miguel has also ordered what is equivalent to a large uninterruptible power supply or UPS similar to what we use in our personal computers. These will be installed in the three terminals to assure continued power availability and protection from voltage fluctuations. A new substation will also be built in cooperation with Meralco to exclusively serve the airport. The existing one is now serving the increased load demand of the Megaworld mall, condos and hotels across T3.

San Miguel has ordered new air conditioning and will repair eight air bridges in T3 which have been defective for a long time. They will install lightning dissipators to solve the lightning alert problems.

The SMC Group is also buying new conveyor belts for the luggage carousels which all need to be replaced.

There will be appropriate road signs directing motorists to the right airline terminals which are standard in other countries but neglected here.

In a future column, I will take up other innovations to erase the national shame we feel about our airport.

Boo Chanco’s email address is [email protected]. Follow him on X @boochanco.