Manila Bulletin, 02 April 2014
By Edu Lopez
The Asian Development Bank (ADB) has urged governments to proactively use fiscal policy to close gaps and promote more inclusive growth as widening income gaps are undermining the successful poverty reduction in Asia.
â€śFiscal policy can and should play a bigger role in promoting inclusive growth in Asia,â€ť said ADBâ€™s Deputy Chief Economist Juzhong Zhuang. â€śAsian policy makers must act now to integrate inclusion targets into their budget planning to transition to a path where the benefits of growth are broadly shared.â€ť
The ADBâ€™s Asian Development Outllok 2014 report noted that during the 1990s and 2000s, more than 80% of the regionâ€™s population lived in countries with worsening Gini coefficients, a common measure of inequality. The same market forces that have enhanced growth in the region â€” globalization, technological progress, and market reform â€” now exacerbate inequality.
The international experience shows that public spending can reduce income inequality. Government spending on education and health care, for example, broadens access for the poor to these vital services and helps level the playing field, the report said.
â€śMaking infrastructure affordable and accessible allows the poor to take better advantage of the opportunities that come with improved education and health.â€ť
â€śHowever, developing Asia lags other regions in public investment to promote equity. Public spending on education averages 2.9% of gross domestic product (GDP) in the region compared to 5.3% in the advanced economies, and 5.5% in Latin America. The difference is starker for health care: 2.4% in Asia versus 8.1% in advanced economies, and 3.9% in Latin America.â€ť
â€śThe way funds are used can be as important as the amount. Education policy can promote inclusion by prioritizing basic education or expanding technical and vocational training to give students the practical skills and knowledge they need for work.â€ť
â€śPublic health policy can do the same by directing funds toward rural health clinics, for example, rather than the latest medical machines for urban hospitals,â€ť the report suggests.
Many regional economies have scope to direct more public resources toward this type of spending, the report says. But this capacity may not last as rising costs associated with aging societies and environmental pressures will squeeze fiscal space in coming decades.
â€śAsiaâ€™s revenue base remains small by global standards: During the 2000s, the ratio of tax revenue to GDP averaged 17.8% in developing Asia, well below the global average of 28.6%.â€ť
â€śOptions to raise revenue include broadening the base for personal income tax and value-added tax, enlarging corrective taxes and nontax revenues, and introducing naturally progressive taxes on property, capital gains, and inheritance,â€ť the report said.
The report also recommended policy actions to support efforts to raise revenue that would include systematically incorporating equity objectives into fiscal policy, preferably over a medium-term horizon; upgrading government fiscal data to better track public programs and assess their effectiveness; leveraging information and communication technologies to improve tax administration; and considering public-private partnerships in social infrastructure to help extend the reach of education and health care services.
Photo source: Â National Mental Health Administration Building by David Montasco Snapshots (http://www.panoramio.com/photo/60853214)
GMA News, 25 December 2012
After hitting the targetedÂ roll-out of eight big-ticket projectsÂ for this year, the government is now looking to utilize its flagship public-private partnership (PPP) program for so-called “social infrastructure” projects, such as building housing communities for 60,000 informal sector families in Metro Manila and the â€śrestoration and redevelopmentâ€ť of heritage structures in Old Manila.
The PPP Center has been looking at proposals for these specific projects, said the center’s executive director Cosette Canilao.
â€śWhile the momentum is there, we want to go to the next level. It’s time to move on to more ambitious projects that the government has not done before,â€ť she said.
The relocation of the informal sector in the National Capital Region forms part of the Department of Public Works and Highways’ initiative to declog waterways in the metro, after the southwest monsoon in August caused massive flooding in the region.
Canilao noted that the proposal was jointly put forward by the National Housing Authority and the DPWH.
â€śThe study now focuses on how will it be viable for investors as well as how to build communities and not just housing,â€ť the official said.
â€śThe challenge, really, is building communities â€“ where social services and employmentÂ are available for them [informal settlers],â€ť she added.
The PPP Center, the agency reviewing project proposals for inclusion in the flagship program, is also mulling ways to redevelop the Old Manila area.
â€śIt’s important to maintain the integrity of these structures para ‘di masayang. We are looking at emulating the way Singapore has restored old structures,â€ť Canilao said, referring to the city-state’s historic General Post Office, which was redeveloped into the luxury Fullerton Hotel in 1997.
Canilao said the first two in the pipeline could be the Old Manila Post Office and the Manila Metropolitan Theater, both of which are now in a dilapidated state.
She noted that if everything â€śgoes well,â€ť the housing and restoration projects could be rolled out â€śby the end of 2013 or in early 2014.â€ť
So far, social infrastructure projects under the PPP program are in the health and education sectors.
Two of these are in already in the bidding stage: the P13.14-billion PPP for School Infrastructure Project Phase 2 that involves the construction of 10,679 classrooms in over 5,000 state-run schools nationwide; and the P5.6-billion project to build, operate and maintain a new 700-bed capacity tertiary orthopedic hospital.
Another social infrastructure project â€“ the P16.5-billion School Infrastructure Project Phase 1 involving the design, finance and construct of about 9,300 classrooms in Luzon, which was awarded last September â€“ was the second PPP to complete the bidding stage.Â â€” BM, GMA News
30 November 2012, The Manila Times
by Noel Alcober
Despite the criticism from Sen. Miriam Defensor-Santiago, the Department of Education (DepEd) on Thursday thanked the senator for addressing the issue on educational budget, particularly the cost of every classroom.
â€śDepEd thanks the good Sen. Miriam Santiago for the general concerns she raised on the cost of our classrooms as this likewise shows that she is a true DepEd partner in promoting quality education,â€ť DepEd Assistant Secretary Tonisito Umali told The Manila Times.
Earlier, Santiago said that the cost of P1.1 million for every classroom is too high.
But Umali said that the P1.1 million cost for every classroom raised by Santiago is a weighted average of the single and two-storey classrooms under the DepEdâ€™s Private Partnership for School Infrastructure Project (PSIP).
â€śActually, a single-story classroom with toilet, furniture and fixtures is 730, 000. While a two-story classroom with toilet, furniture and fixtures costs P1.25 million. Reason why average cost of a classroom in a two-storey building is more expensive is that the columns/foundations or architectural and engineering structure is different and needs to be stronger,â€ť he said.
Umali also noted that 69 percent of the 9,301 classrooms under the PSIP are two-story structures, adding that only 31 percent are single stories.
â€śThatâ€™s why the average cost leans towards the more expensive cost. The average cost also includes toilets, furniture and fixtures. Hence, it is not equivalent to our present P650,000 cost per classroom. The stairs, ramp for CWD [children with disability], and value-added tax are also included in the average cost for two stories,â€ť the Education official explained.
GMA Network, 25 September 2012
Public-Private Partnership (PPP) investments are critical to the rehabilitation and improvement of 25 ailing government-run hospitals, said an official of the Department of Health (DOH).
â€śIf the government alone were to handle the rehabilitation of these 25 hospitals, it [would] take us more than 25 years to do it due to limited funds and bureaucracy,â€ť said DOH undersecretary Dr. Teodoro Herbosa at a British Embassy luncheon briefing on PPP projects.
The government is, however, helping the process along by infusing P3 billion as counterpart funding for the initial improvement of these government hospitals to make them attractive for PPP investments.
The Philippine Orthopedic Center (POC), whose medical infrastructure has been outdated for years, is one of the hospitalsÂ up for PPP investment.
Herbosa, who heads the DOH Task Force for PPP and Health Facilities Enhancement Program, said that the P1.2-billion DOH Vaccine Self-Sufficiency Program is also being offered for PPP investment.
To highlight key PPP investment opportunities in the Philippines, UK Trade & Investment (UKTI) is hosting a seminar mission for British investors and companies on November 8 and 9 in Manila to help them explore opportunities for PPP and infrastructure investments in the country.
The mission will provide a platform for British companies engaged in PPP funding to present their areas of expertise and capabilities before an audience of government agencies, key industry players, and local suppliers and services firms that are potential partners of the British firms.
According to the UKTI, the UK is cumulatively the largest investor in the Philippines for the past decade, with combined net foreign direct and net portfolio investments between 1999 and 2009 totaling $9.3 billion.
According to British government officials, the UKâ€™s PPP project investment on roads, ports, airports, rail, health, education, power, water and agriculture in the Philippines can reach ÂŁ10 billionâ€”with transport projects estimated at ÂŁ2 billion and infrastructure projects at ÂŁ1.3 billion prioritized for roll-out from 2012 to 2013.
The British Embassy is sending Herbosa and key government experts from DOH, the Department of Transportation and Communications (DOTC) and the Department of Finance to London from October 7 to 15 to engage with British experts on PPP projects.
Herbosa also said that medical costs at these hospitals will not increase when they become semi-privatized under the PPP projects, adding that 70 percent of beds in these hospitals will be reserved for sponsored patients that include poor and lower-middle class patients whose medical costs will be subsidized by Philhealth.
Among the government hospitals up for PPP investments are the Jose Reyes Memorial Hospital, Jose Fabella Hospital, San Lazaro Hospital, Quirino Hospital and National Mental Health Hospital.Â â€” BM, GMA News
03 September 2012, GMA News
by Anna Mae Yu Lamentillo
Budget Secretary Florencio “Butch” Abad said Thursday that the participation of the private sector is crucial in ensuring genuine and sustainable reform and delivering social services.
â€śBecause we know that certain vested interests out there will not want us to succeed, we need to tap and empower the broadest possible spectrum of stakeholders in our society,â€ť he said.
This is the goal of the government’s Public-Private Partnership (PPP) program, which according to its official site aims to â€śstimulate private resources for the purpose of financing the construction, operation and maintenance of infrastructure and development projects normally undertaken by the Government.â€ť
Abad added that the government has already introduced PPPs for social service infrastructure.
â€śSimilarly, we are also looking at similar partnerships for public administration and service delivery, including the bulk tender of overhead expenses of national government: gasoline, air transport, telecommunication, insurance, among others,â€ť he said.
In a separate interview, National Competitiveness Council (NCC) Private Sector Co-Chairman Guillermo M. Luz admitted that the government â€śtook longer than expectedâ€ť to prepare and bid out projects under the PPP, but added that the process has now been â€śstreamlinedâ€ť and should pick up speed.
â€śThe government has already bid out Daang Hari-SLEX [South Luzon Expressway], and the School Infrastructure Project. This is a clear indicator that PPP is gaining its momentum,â€ť he told GMA News Online in a phone interview Thursday.
â€śThe next School Infrastructure Project should be easier since weâ€™ve already done it. Uulitin na lang,â€ť he said.
The government’s Public-Private Partnership Center has listed Ayala Corporation as the contractor for the Daang-Hari-SLEX Link Project.
The bidding process for the School Infrastructure Project, which aims to build 9,300 classrooms in Regions I, III, and IV-A, has also concluded, and the contract is scheduled to be awarded soon.
Two other projects are ready for bidding: the LRT Line 1 Cavite Extension and Operation and Maintenance, or the LRT 1 South Extension; and the NAIA Expressway Project.
The LRT 1 South Extension is expected to increase LRT coverage by 11.7 km, and connect Baclaran to Bacoor, Cavite.
The NAIA Expressway Project is expected to connect NAIA Terminals I, II, and III to major thoroughfares like the Skyway and the Manila-Cavite Toll Expressway.
In the pipeline
Three projects are currently securing government approvals: the Modernization of the Philippine Orthopedic Center (MPOC), the Vaccine Self-Sufficiency Project Phase II (VSSPII), and the CALA Expressway (Cavite and Laguna Side).
Fifteen projects in the transportation, agri-fisheries, agriculture, education, health, heritage restoration and water supply sectors are at various early stages, ranging from finalization of project structure to procurement of technical assistance. â€” BM, GMA News
09 September 2012, ABS-CBN News
Government is planning more social public private partnerships after awarding a classroom project it bidded out last month.
In an interview on ANC’s Inside Business, PPP Center executive director Cosette Canilao said health centers could be next as well as projects for informal settlers.
“Other social infrastructure, maybe we could follow the template of classroom construction into health centers, for example, all over the country,” she said.
“I’m hoping we can use the PPP model to solve our informal setllers problems especially in Metro Manila. We’re looking at a model that can solve that as well.”
Meanwhile, Education Underscretary Francis Varela said government is keeping its target to end the shortage of classrooms by next year.
“While it has taken us some time to initate this projetc, now that we have completed the first phase, we hope we will be able to build on this and build several thousand classrooms more under the PPP mode. That’s very critical because we’re addressing the shortages that have built up in our educational system,” Varela said.
The Department of Education last month announced the winning bids for 3 packages under the PPP for School Infrastructure Project, a build-lease transfer contract for the design, construction and maintenance of 9,301 classrooms in Regions I, III and IV-A.
Listed firm Megawide Corp. and a company owned by former Metro Manila Development Authority chairman Bayani Fernando won the bidding to construct 9,301 public classrooms. – With ANC
17 July 2012, Business World Online
by Antonio Siegfrid Alegado
THE DEPARTMENT of Health (DoH) is eyeing to employ the governmentâ€™s public-private partnership (PPP) initiative to modernize 25 state-run hospitals, a Cabinet official said yesterday.
â€śWe want PPP for infrastructure and technical upgrades of 25 DoH-run hospitals,â€ť Health Secretary Enrique T. Ona said during a Senate hearing on updates of his departmentâ€™s use of its budget for this year.
Health Undersecretary Teodoro J. Herbosa added in a telephone interview yesterday, â€śThis is in-line with the departmentâ€™s thrust to provide accessible, quality health care to all.â€ť
Mr. Herbosa noted that the department had already submitted to the PPP Center proposals for five of the 25 hospitals it hopes to put under the stateâ€™s flagship program.
â€śWe have submitted a proposal for five of the 25 proposed PPPs for hospitals, and will soon submit the next five,â€ť he said, without elaborating.
Sought for comment, Rina P. Alzate, director of the PPP Centerâ€™s Project Development and Monitoring Facility (PDMF) Service, confirmed the submission. â€śYes, itâ€™s true that theyâ€™ve submitted five proposals,â€ť she said in a separate phone interview.
Ms. Alzate explained that the DoHâ€™s proposal â€śessentially, requests for funding supportâ€ť to proceed with feasibility studies on possible PPPs for Western Visayas Medical Center; Quirino Memorial Medical Center; Bicol Medical Center; Vicente Sotto Medical Center; and Cagayan Valley Regional Medical Center.
â€śWeâ€™re just requesting [from] them (DoH) additional documents,â€ť Ms. Alzate added, referring to details like â€śindicative scope of the project, among others.â€ť
Mr. Herbosa said the department is â€śstill studying the scope of the projects, which will be bid out [sic] to the private sector.â€ť
â€śWe are just finalizing the terms, like economic viability and other requirements,â€ť he added.
â€śThis should be done and submitted before year-end.â€ť
The new projects will be considered for feasibility study funding by the Project Development and Monitoring Facility as soon as all requirements are submitted, Ms. Alzate explained.
The proposals will then be submitted for approval by the Investment Coordination Committee-Cabinet Committee of the National Economic and Development Authority (NEDA), she added.
Two of DoHâ€™s PPP projects — the P5-billion Modernization of the Philippine Orthopedic Center and the P453-million Vaccine Self-Sufficiency Project Phase II — got the ICC-CabComâ€™s nod last May and April, respectively.
The projects involve construction of 700-bed capacity tertiary orthopedic hospital in Quezon City and develop self-sufficiency in vaccine production.
Both projects are now awaiting approval by President Benigno S.C. Aquino III, as chairman of the NEDA Board, before being put on the auction block.
So far only one PPP project — Ayala Corpâ€™s P1.96-billion Daang Hari-South Luzon Expressway Link Road project — has been awarded since the flagship program was first unveiled before foreign investors in the fourth quarter of 2010.
Two other projects have been tagged by the PPP Center as â€śready for biddingâ€ť in the agencyâ€™s Web site, namely:
â€˘ the P59.2-billion LRT Line 1 Cavite Extension and O&M (operation and maintenance), involving construction of a 11.7 kilometer stretch from the lineâ€™s Baclaran Terminal to Niyog Station in Bacoor, Cavite; and the
â€˘ P10.04-billion PPP for School Infrastructure Project, which includes design, financing and construction of about 9, 300 classrooms.
In the same hearing, Mr. Ona reiterated calls for Congress to approve the â€śsinâ€ť tax reform bill in order to boost funding for health care. â€śRestructuring the excise taxes of alcohol and tobacco would greatly help the DoHâ€™s programsâ€ť he told legislators, noting that Executive wants the â€śP30-billion in fresh revenues that the bill can generate be used solely for health programs.â€ť
The House of Representatives approved its version of the bill last month. The priority measure will face fresh discussions at the Senate when sessions resume next week.
05 July 2012, TheÂ Manila Times
by Mayvelin Caraballo
Heritage restoration projects through public-private partnerships (PPP) are deemed highly viable specifically in the light of a growing tourism industry, PPP Center said on Wednesday.
For example, PPP Center Executive Director Cosette Canilao cited the countryâ€™s first heritage restoration project to be undertaken as a PPP project in Talisay City, Negros Occidental.
The PPP project involves the restoration and conservation of the cityâ€™s neglected heritage sites to boost its tourism value.
Talisay Cityâ€™s development plan dubbed as â€śThe Village City: A Model for Balanced Development by 2040,â€ť centers on the restoration and redevelopment of the Talisay City Plaza Complex including the conversion of the Talisay City Central Public Market and the Old Talisay City Hall, including the plaza, into mixed-use facilities.
Historic sites such as the San Nicholas de Tolentino Church, which was built in 1850, and the old Lizares mansion will be restored and conserved to highlight the richness of Talisayâ€™s history.
â€śWe consider the Talisay heritage project as a clear example of the scope and breadth that public-private partnerships can be tapped,â€ť Canilao said.
He added that traditionally, PPP focused mostly on hard infrastructure like roads, however, this time, the government is using PPP for social infrastructure like school buildings and hospitals.
â€śWith Talisay, we are exploring heritage and tourism. The recent market sounding made it clear to us that there is much interest from the private sector for this type of PPP project,â€ť Canilao noted.
The PPP Center executive director further said that the government is hopeful that the Talisay project will be the start of more partnerships and projects on heritage and restoration with the private sector.
The PPP Center said that major retail operators have expressed strong interest to take part in Talisay Cityâ€™s Plaza Complex Heritage Restoration and Redevelopment project.
Mall giants Ayala Land Inc. and SM Prime Holdings of the SM Super Malls, alongside Negros Occidental-based retail players 888 China Square, Lopues Department Store, and Carmella Valley Corp., recently attended the market sounding session conducted by the local government of Talisay in Negros Occidental led by Mayor Eric Saratan of Talisay City and the PPP Center.
It added that the market sounding session brought together the local government of Talisay and interested investors and stakeholders to level off expectations and discuss issues that can positively benefit the structuring of the project.
2 May 2012
SMX Convention Center
The seminar provides a venue to discuss the current gains of PPP initiatives in the Philippines as well as future developments and investment opportunities that the Asian region can forward to.
The PPP’s seminar is divided into three main panel discussion agenda:
Metro Manila and key cities in Asia are experiencing rapid urbanization, calling for more mechanisms to address accompanying issues on road and transport infrastructure, housing provisions, water and waste management, energy and other utilities supply, green spaces, among others. Â The session discussed the investment opportunities in Philippine urban development through a wide range of infrastructure projects under PPP. Â It highlights the key strength of PPP and its critical role in driving growth and changes in urban areas.
Tourism councils in most countries today recognize the need to include heritage tourism in their strategic thrust giving the rising percentage of travelers who want to experience real stories, past and present, behind people, nation and places. Â The session will focus on the role of PPPs in pushing heritage tourism, and feature heritage tourism projects in the Philippines and other countries that utilize PPP model. Â It discusses the value of conserving heritage sites, including its revenue-generating and livelihood prospects as well as positive impact to communities.
Social infrastructure investment is found to have a direct and positive impact to the society. Developing PPPs for purposes of improving the quality of education, health and housing has been proven feasible through a number of joint contracts. Â This session will showcase some case studies that have successfully demonstrated the benefits of PPPs in various sub-sectors and its social impact especially on underprivileged communities.
*Manila 2012 Event Program Guide