P2-B Takenaka deals scrapped

Posted at 12/22/2010 12:09 AM | Updated as of 12/22/2010 5:01 PM

MANILA, Philippines - The government has cancelled 19 "overpriced" airport civil works contracts with Japanese firm Takenaka Corp., as part of a review that started last July of deals awarded by the Arroyo administration in its "few remaining months."

In a briefing with reporters yesterday, Transportation and Communications Secretary Jose P. De Jesus said the P2.3-billion total price for the rehabilitation and upgrade of the Ninoy Aquino International Airport Terminal 3 (NAIA-3) was "exorbitant." Takenaka was the subcontractor hired to build NAIA-3.

"The P2.3-billion 19 stand-alone contracts...with Takenaka...have been cancelled, as we believe that these could be agreed on at a lower price," Mr. De Jesus said, noting these involved "minor works such as repairs [of] roof, walls."

He explained that specific works on the airport terminal were awarded through "specific contracts."

He added that the Department of Transportation and Communications (DoTC) estimates that cancellation of the NAIA-3 "midnight contracts" will result in "savings of close to $20 million."

Mr. De Jesus said this was a result of his department’s review of 168 contracts since July.

Of that total, 111 were cleared to proceed, one is still being reviewed, while 56 -- including the Takenaka deals -- were either cancelled or suspended for clarification and explanation.

"We had ordered agency contracts and all major infrastructure projects to be held in abeyance, pending a detailed review by the DoTC legal arm headed by Undersecretary Aristotle B. Batuhan," Mr. De Jesus said, refusing to give details.

"These projects were approved in the few remaining months of the previous administration."

A statement on the DoTC’s review of contracts did say that the department had hired "legal and financial experts" to finalize a strategy for the government’s takeover of the Metro Rail Transit 3 line from the Metro Rail Transit Corp., and that it will revise terms of reference to widen the list of prospective bidders for the new driver’s license and for transport equipment, particularly those of the Philippine Coast Guard.