GOTCHA By Jarius Bondoc, The Philippine Star, Friday, October 26, 2007
Government sets rules to protect public interest. If an agency breaks them, it can only be for suspicious motives. That’s what’s happening to the plan for a government broadband network, and in the soap industry.
The broadband complex would hew together government’s landline, cellular and Internet infrastructure. Administrations had long dreamed of it, and launched three smaller but failed types: Telecom Office, Municipal Telephone Public-Calling Office, Telepono sa Barangay. Enter Amsterdam Holdings Inc., proposing to take over the work from the Dept. of Transport and Communications, and erect a bigger one. AHI’s "Orion Project" directly would interconnect all provincial capitols, city halls, and first- and second-class municipios. Geared to support health and education, it would cover all state colleges, half of public high schools and hospitals, and most private hospitals. Wireless service also would be given to 1,203 national agencies and state firms, 2,000 post offices, 350 state colleges, 2,643 high schools, 200 hospitals, 117 city halls, 41 provincial capitols, 465 municipios, and 5,000 barangay halls.
All this AHI promised to build in four years for $240 million under a build-own-operate scheme. It would set up the network on its own, turn it over to DOTC, then run it for a fixed period of cost recovery.
In the unsolicited proposal of Dec. 5, AHI pledged to bill government a percentage below the lowest rate of local telecoms firms: 50¢-70¢ per call. This would cut by a fourth the P3.5 billion that government spends on calls. All AHI needs is an assurance of executive performance, as stated in the Build-Operate-Transfer Law, that government would use half of Orion’s capacity. The other half would be sold to private users, to subsidize the discounted government rate.
Under the law, DOTC must start studying the unsolicited proposal within 60 days. Then, it must submit the papers to the National Economic and Development Authority, for a Swiss challenge that allows the original proponent to match the lowest bid. Seventy-five days from receiving AHI’s papers, DOTC has not moved. Worse, it accepted another unsolicited bid, prohibited under the BOT Law, from a Chinese firm.
More violations emerge. The new proposal, from ZTE Group, offers a government-to-government loan, which in turn would require a sovereign guarantee of repayment. The BOT Law forbids so in unsolicited proposals. The ZTE plan is only to erect the broadband facility then let DOTC run it. This runs counter to government policy of privatizing its telecom assets. ZTE’s price is even higher, $262 million, and would take longer to finish. Yet DOTC is rushing to endorse it to NEDA. DOTC bigwigs even set up a presentation to President Arroyo by ZTE managers — in obvious favoritism.
Last Mar. 18 AHI complained to DOTC Sec. Leandro Mendoza about the bias. If the latter does not respond by next week, he would be in breach of yet another law that requires officials to act on mail in 15 days.
The graver law against corruption is being broken. Talk in telecoms circles has it that a Comelec man and a cohort in the failed poll automation are interfering in the bidding.
