‘NAIA-3 overpricing probe won’t affect March opening’

Malacañang assured the people yesterday that the Cabinet investigation into the alleged overpricing in the construction of the Ninoy Aquino International Airport Terminal 3 (NAIA-3) would not affect the scheduled opening of the terminal in March.

Press Secretary Ignacio Bunye said the probe was raised by President Arroyo to the Cabinet "to ensure that any money shelled out from the public coffers is worth the real value of goods paid for."

"The planned high level inquiry into the alleged NAIA-3 overpricing will not affect the status of pending cases and will certainly not affect its scheduled opening," Bunye said.

He said the administration aims to draw lessons from the NAIA-3 process to build greater integrity into the system.

The government is facing two suits from the consortium that built NAIA-3 — German-based Fraport AG and the Philippine International Air Terminals Co. (Piatco) — for expropriating the facility in December 2004.

Fraport AG filed its case before the International Center for the Settlement of Investment Dispute (ICSID) in Washington while Piatco sued the government before the International Chamber of Commerce in Singapore.

The government has already paid Piatco P3 billion as initial compensation for the facility in compliance with a Supreme Court directive to allow it to have full ownership of the airport.

Last September, Mrs. Arroyo briefly met with German Chancellor Angela Merkel to explain the reasons behind the takeover of the airport even as she gave assurances that the government respects international laws and contracts.

Testifying in a recent hearing before the ICSID as a government witness, fraud expert Howard Silverstone said there appeared to be a discrepancy between the claims for reimbursement and alleged expenses of Fraport AG.

Silverstone said Fraport’s estimated expenses should amount to $396 million at most and not $425 million as it claimed.

He said only $53 million was documented to have been coursed to Piatco and only $33 million was found to have been directly used in the terminal as "soft costs."

Silverstone said it still could not be determined whether the remaining $363 million was actually used for the airport, as Fraport and Piatco refused to open their book of accounts and submit other documents.

Bunye said the results of the investigation would be used to fine-tune rules and regulations on such undertakings to ensure that there would be no overpricing in future projects.

Meanwhile, government lawyers said that the NAIA-3 is not safe for both passengers and aircraft.

In a statement, the lawyers, representing the Philippine government in the international tribunal where it faces a $425 million claim suit from Fraport, cited various structural defects and deviations from the original design.