Roxas squarely responsible for MRT-3 mess

It is President Benigno S. Aquino’s criminal negligence that resulted in 44 police commandos massacred; that should convince us never, never again to have such kind of yellow leadership, especially that of a haciendero scion.

It is the criminal mismanagement by his candidate, Manuel Roxas 2nd, of the main mass transport system of Metro Manila that has made the MRT-3 a daily hell for hundreds of thousands of commuters. That should be enough to convince every Filipino never ever again to vote into any position of power anybody from the yellow cult, especially a haciendero scion.

Consider the facts and tell me if I am exaggerating.

For 10 years after MRT3 started operations, the Japanese firm Sumitomo Corp. maintained the system under a contract with Metro Rail Transit Corp. (MRTC), the MRT-3 builder. The train was so efficient that Sumitomo would boast about MRT-3 in its sales pitch for bidding for similar projects around the world.

Sumitomo’s contract expired July 2010, and was renewed on a six-month basis only, but for four times by the MRTC, subject to DOTC’s approval. MRTC chairman Robert Sobrepeña told this writer that Sumitomo was in a bind – it required a longer time frame, so it would estimate how much of maintenance inventory it needed to keep, which actually cost half of its more than $1 million monthly contract. Sobrepeña and Sumitomo continually wrote letters to the DOTC to request a bidding for a longer-term contract. “We got absolutely no reply,” he said.

In the letter of DOTC Secretary Joseph Emilio Abaya published in response to columnist Jarius Bondoc’s well-researched exposes, the secretary wrote:

“On 4 October 2012, the MRTC wrote the DOTC, informing the latter that it would no longer procure a maintenance service contractor once Sumitomo’s contract would expire (sic) on 19 October 2012.

Given the short period of time left before said contract would expire, the DOTC resorted to a simplified bidding process in line with the Procurement Law (Republic Act No. 9184) beginning in the first week of October 2012.”

Abaya lying

Abaya was lying so the blame would be on MRTC, that it suddenly stopped Sumitomo’s contract.

It was the DOTC’s MRT-3 General Manager Al Vitangcol who told the MRTC in early September that it would no longer agree to extend Sumitomo’s contract.

The DOTC officially informed the MRTC on October 4 that Sumitomo’s contract would not be extended. It then scheduled a bidding in two weeks, a “simplified” one, which involved simply the submission of bids, and for government to negotiate with what it felt was the best bidder. It justified this by claiming it was an emergency move taken in order to prevent, to quote its letter, “a stoppage of MRT-3’s operations, which would have severely disrupted the daily transportation needs of its close to 600,000 riders.”

That was the start of MRT-3’s deterioration.

Note that all this time, when a proper bidding could have been undertaken and bidders given all the time to prepare for it – two years after Sumitomo’s contract expired July 2010 – the head of the DOTC, the Cabinet member in charge of this crucial mass transit system, was Roxas.

Totally unexpected however – although conspiracy theorists allege another scenario – was the death of DILG Secretary Jesse Robredo Aug. 18, with Aquino announcing Aug. 31, 2012 that Roxas would replace him.

However, Roxas assumed his DILG post only Oct. 19, the day the Sumitomo contract expired, and an obscure PH Trams-CB&T, was designated winner of the simplified bidding.

PH Trams-CB&T was a brand new company only two months old, and had a subscribed capitalization of only P2.5 million, or equivalent to only a 120th part of the P300 million cost of the MRT-3 maintenance contract it was given.

One of its six investors was known in Pangasinan province as a Liberal Party financial supporter – Wilson de Vera. He had been accused by the Czech ambassador of attempting in July 2012 to extort $30 million from the Czech company Inekon in exchange for winning the contract to supply MRT-3 its train cars.

On Dec. 15, the Ombudsman filed charges against Vitangcol, who signed the contract for MRT-3 and all of PH Trams incorporators for corruption involving the contract’s award. That’s another case why I question the Ombudsman’s integrity: Why weren’t Vitangcol’s bosses, first Roxas, and then Abaya, charged?

Why did Roxas drag his feet for a month-and-a-half to leave his DOTC post Oct. 19, even if Aquino had appointed him to the DILG post Aug. 31? Is this a huge coincidence that Oct. 19 was after the PH Trams closed the contract with MRT-3?

Am I too biased to suspect that Roxas was a segurista, that he wanted to make sure that his two-year plot to get a favored contractor in place before he stepped down pushed through? Was it even a better scenario for him that his apparently witless lackey, Abaya, and Vitangcol signed the contract papers and, therefore, would be accountable if the scheme wax exposed?

What these morons did not realize, though, was that Sumitomo’s maintenance contract was not as profitable as it seemed. Half of the contract price was the cost of inventory for the MRT-3’s parts, which were expensive because many of them were precision-engineered and of the highest-quality steel.

What the idiots didn’t know

What these idiots did not know was the typical Japanese business model that is so different from the Americans. Japanese companies have a longer-term strategy, so that they agree to the smallest margins, as long as their reputation is built up for more and bigger projects. Its MRT-3 maintenance contract barely made a profit, but Sumitomo used the rail’s efficiency as a sample of its expertise in light rail building.

Indeed, Sumitomo has built up a reputation as one of the best light-rail builders in the world, with its latest projects being the $500 million contract signed in 2012 to build Vietnam’s first urban rail system and a $398 million supply contract for Chicago Metra’ commuter rail cars.

Trying to scrimp on cost as much as it could from its contract, PH Trams didn’t build up a stock of spare parts that it had to cannibalize its other cars for the required parts. The result: the number of cars running at present stands at 14 at the most, down sharply from 70 when Sumitomo was running MRT-3.

Without replacements, the trains’ steel wheels have also become squeezed into ovals so that now these have to run slower or they would be derailed. With maintenance becoming so messed up, MRT-3 trains have been stopping at mid-stations, are so few, or run so slowly.

But Abaya may not really be the person he may think he is, since he appears so “what-me-worry?” confident even if it has become obvious to many that he messed up MRT-3, that it is an accident waiting to happen.

On Christmas eve, Abaya awarded a new P4 billion contract to a Korean-Filipino consortium consisting of Busan Transportation Corp., Edison Development & Construction, Tramat Mercantile Inc., TMCI Corp Inc., and Castan Corp. As what happened during Roxas’ time, Abaya claimed there was an emergency situation so that the “winner” of the bid was determined through negotiations.

Roxas, when he was about to assume the six-year term of the top DOTC post, awarded only six-month contracts for the MRT-3. Abaya – who is also the Liberal Party president, by the way – having only less than six months to go before he leaves the DOTC as its secretary, signs a contract for three years, i.e., until 2018, long after he is gone. I think Abaya turns out to be more clever than Roxas.

If the Senate is reinvestigating the Mamasapano massacre, they might as well investigate the MRT-3 mess, which could, if uncorrected, lead to accidents killing more than those murdered by the Moro insurgents in Mamasapano./


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