THE government should tap public-private partnership (PPP) rather than borrow to push its infrastructure development, according lawmakers.
Sent. Grace Poe and Rep. Edgar Mary Sarmiento, chair of the committees of transportation at the Senate and at the House of Representatives, respectively, in a virtual roundtable last week noted the advantages of PPP over government-funded projects.
Sarmiento said PPP would avoid government from carrying huge cost of borrowing and can then use its funds to other public services.
Poe said PPP shifts project costs from the taxpayer to the user of the project’s services.
“By contracting out the undertaking of large projects that are commercially viable, the government can free up funds to spend on health care and poverty alleviation projects,” Poe said.
She added: “If a private sector project becomes unprofitable, it is shareholders’ money that will be lost. If a government corporation becomes unprofitable, it is the taxpayer who will pay. We all know what happens here – the GOCC (government-owned and controlled corporation) will simply ask for a bigger budget next year.”
Sarmiento said PPP should be institutionalized while major infrastructure projects should be legislated to ensure continuity beyond administrations.
Sarmiento is the proponent of House Bill No. 90 or an act providing for the modernization of the Philippine transportation infrastructure.
The bill would require the Department of Transportation (DOTr) to submit their transportation infrastructure plan for review by Congress.
“Congress shall also appropriate funding for the projects under the plan. Through this, we can ensure that even if there is a change in administration, the project would still continue,” Sarmiento said in the forum hosted by Stratbase ARDi.
The House Committee on Transportation is also tackling several bills on other infrastructure projects, such as those in tourism and other public works and measures that aim to strengthen the PPPs.
Poe said the new coronavirus pandemic all the more stresses the need to revive PPP as a bridge towards recovery.
Sarmiento said private sector investment can also support the “Balik Probinsya Program” of the government and PPPs can also support the agriculture sector.
“Initiating a variety of projects will create more jobs in the regions which shall provide incentives for workers in Metro Manila to go back to the provinces,” he said.
