PPP Center
Press Release

11 October 2012 – The construction of more than 9 thousand classrooms will soon commence with the signing of the PPP for School Infrastructure Project (PSIP) contracts under the government’s public –private partnership program.

PPP for School Infrastructure Project Contract Signing

Department of Education Secretary Bro. Armin Luistro signed on behalf of government with Engineer Reynaldo dela Cruz representing the BF Corp. Riverbanks Development Corporation Consortium and the Megawide Construction Corp. and Citicore Holdings Investment, Inc. led by Mr. Oliver Tan, Chief Financial Officer of Megawide Corp., Mr. Louie Ferrer, President of Citi-Core-Megawide and Mr. Edgar Saavedra, President of Megawide.

Public-Private Partnership Center Deputy Executive Director Ferdinand Tolentino signed the contract as witness.

In his short message, Dela Cruz thanked Deped for having the vision and noble intentions to make things happen for our future generation. He added that BF Corp. is committed to support the PSIP of the Dep Ed until the school buildings are built and ready for use. Former MMDA chair Bayani Fernando and daughter Tala Maria Fernando both attended the contract signing.

Ferrer on the other hand said that his team expressed willingness to do another project with the DepEd. He explained that his team was willing to do it again “because the people who helped us with this project are parents of the children who will be using the same classrooms next year. Walang katumbas ang sabihin ng anak ko na gawa yan ng tatay ko … gawa yan ng nanay ko.”

Many Firsts

For Megawide Construction Corp. and Citicore Holdings Investment, Inc. participating in the PSIP is their first foray working with government as builders. “This project is special not because it is our first with the government but mainly because this is our chance to make a difference in the future of our country,” Ferrer said.

The PSIP is the country’s first social infrastructure project under the PPP program. It will also be the first among PPP projects rolled–out under the Aquino administration to be constructed.

The PSIP will be funded using the Multi-Year Obligating Authority (MYOA) issued out by the Department of Budget and Management for locally funded projects or foreign-assisted projects, another first under the PPP program. The MYOA will cover its annual lease payments, amounting to PhP1.628 billion, for the next 10 years. Based on DBM guidelines, a MYOA is issued to an agency that voluntarily commits to give priority and include in its annual budget the Multi-Year Project (MYP) requirements.

No Corruption is possible

In his message, Secretary Bro. Luistro strongly emphasized his request not to compromise the integrity of the project.
“The very building that we put up should be a testament to the reality and truth that in the Philippines, it is possible to put up buildings without any corruption. It is possible for business to thrive and earn a decent return of investment without corrupting the very bureaucracy that provides that business.”
Bro. Luistro also stressed the importance of carrying out the project while capturing the spirit of the contract. He reminded the construction companies to build quality school buildings, at the fastest possible time, without short sacrificing its integrity. “Please construct it at the fastest possible time… hopefully majority of it can be turned over before June 2013. We will use those classrooms as soon as you turn these over to us,” the DepEd Secretary said.

Willing to take a risk

Secretary Luistro talked about the skepticism government still faces on doing business in the Philippines. According to the DepEd Chief, majority of Filipinos do not believe in PPP. “There is skepticism that something like this can be implemented. I wish to remind you that there are actually 6 who pre-qualified. Only 2 had the audacity to take that risk and invest in something that, maybe the more prudent among us would say — it is a terrible risk,” Luistro added.

He added, “Our two winners are investing in the hope that it is possible to trust government again. The private sector message is that we are willing to engage in government. Government is trustworthy. They will keep their word. That is something that I will always remember as an important contribution to nation building.”

Kaya ng Pinoy

Secretary Luistro expressed pleasure that both builders of the classrooms are Filipino companies. ‘We will show the Filipinos that kaya ng pinoy. Our technology, our expertise will allow us to building something of this magnitude, and where the quality is not compromised and it adopts to Philippine settings. The Filipino is ready to use this same technology abroad and in other countries.”

Construction of the school buildings is targeted to start in December of this year. The second and third batch of school buildings will be constructed in Visayas and Mindanao.