How not to run airports

There is much to be said about undertaking reforms needed to improve and update the rules, regulations and procedures in the conduct of audit on government transactions. Foremost of such reforms must start with the public bidding process, especially those involving multi-million, if not multi-billion pesos worth of government transactions.

As it is being done at present, government offices and agencies conduct the required public bidding by designating the head and members of a bids and awards committee (BAC). One purpose of any government bidding is to find the best private sector supplier or contractor for the particular government agency or institution undertaking a project or program, or to provide the best materials needed in the conduct of public service.

The general objective is to identify and engage a contractor or supplier that could meet the government requirements of securing the most beneficial terms of contract to best serve public interest.

In the case of the bidding for the operation and maintenance (O&M) of Clark International Airport, a property of the Bases Conversion Development Authority (BCDA), there have been questions if the fundamental objectives mentioned above were met. On the surface, the winning bidder looked very qualified and met the legal requirements to qualify in the first place.

When the BCDA – in partnership with the Department of Transportation (DOTr) – began the selection process for the O & M for the Clark Airport in Angeles City, Pampanga, they held a pre-bid conference in Taguig City on May 21.  A total of 30 firms attended this event. Many of the bidders procured bid documents later.

The BCDA discussed the scope of the O & M concession, including the management and operations of the existing Clark Airport Passenger Terminal and the New Terminal Building after its completion and successful commissioning, legal qualification criteria, and technical qualification criteria for prospective bidders. BCDA president and CEO Vivencio Dizon was quoted as saying: “The government intends to partner with a world-class international airport operator for the O & M, which is expected to be awarded by Aug. 30, 2018.”

The BCDA promised that procurement of the O & M concessionaire will follow a competitive bid in accordance with the Build-Operate-Transfer (BOT) law. They envisioned the Clark airport to be the next major gateway in the country. In fact, it is billed as the first-ever “hybrid” infrastructure project of the government to be implemented by the administration of President Rodrigo Duterte.

The Clark Airport serves various local and international destinations with 332 domestic flights weekly and 158 international flights weekly. The number of flights reportedly increased dramatically last year, with a 122-percent increase or 7,600 flights in 2018 as compared to 3,400 recorded in 2017.

The Aug. 30, 2018 target date of award was postponed at least five times by the BCDA. And in each time, there were revisions on the qualifications of bidders. It came to a point when one by one, the interested bidders had to back out because the stringent qualification requirements seemed to allow only one remaining qualifier.

Time and again in many of his extemporaneous speeches, President Duterte assails the process of government bidding, especially the lowest-bidder rule. As repeatedly belabored by President Duterte, the lowest bidder is not necessarily the best choice or the best qualified. In reality, the lowest bidder who won the contract will just render incomplete service, or produce substandard supplies or services.

As oftentimes explained in typical brutal language of the Chief Executive, those who bid low apparently just wanted to clinch the contract – by hook or by crook.

President Duterte is also critical of the Commission on Audit (COA) for their rigidity in implementing auditing rules. The former Davao City Mayor deplores such straightjacket rules of the COA give no space for practicality.

President Duterte has not made secret his exasperation at the slow pace by which his administration’s priority infrastructure projects and programs are stalled by the rules and procedures in the bureaucracy. Especially now that his administration is entering its mid-term this year, the President could not afford to lose more time to accomplish Duterte administration-produced projects.

Thus, COA has lately become the target of the presidential tongue-lashing in public. The foul-mouthed President Duterte jokingly told his audience he would like to “kidnap and torture” COA auditors for making his governance more difficult than what they ought to do.

Despite these presidential complaints over COA rules, regulations and procedures, there seem to be no initiatives from his administration allies in the 17th Congress to revisit the law that created COA. We could only wonder why.

But the President should not stop at COA because the irregularities in the bidding process may be found right at the start in the BAC, in the agency itself. This anomalous tack of postponing the bidding process and revising, more revising, and imposing stringent qualification requirements that seem to favor only one particular bidder is a more serious transgression of business ethics and fair play, if not the constitutional guarantee of equal protection of the law.

We are all for the development of Clark Airport as the new and promising national gateway that could in the future replace the hopelessly congested Ninoy Aquino International Airport (NAIA). But questionable bidding shortcuts and shenanigans should stop.

Speaking of NAIA, six flights were reportedly diverted again to Clark Airport last Friday night and inconvenienced several hundred passengers, both Filipinos and foreigners, due to runway repair. From what we’ve heard, the passengers were locked inside and made to wait at Clark Airport Terminal until flights resumed the next morning to fly back to NAIA.

How can we bring in more tourist arrivals in our country if our gateways are being run this way?