Senator Risa Hontiveros today called for a Senate inquiry into what has been described as a questionable P9.5 billion loan facilitated by the Bases Conversion and Development Authority (BCDA) for the construction of sports facilities used during the 2019 Southeast Asian (SEA) Games, amid signs that the project was a “fake joint venture” funded with a “behest loan” disadvantageous to the public.
In her privilege speech for proposed Senate Resolution No. 567, Hontiveros urged the Senate to probe the issues surrounding the multi-billion credit arrangement involving the BCDA and Malaysian developer MTD Capital Berhad, which entered into a suspect Joint Venture Agreement (JVA) for the construction of sports facilities in New Clark City.
“Given the billions that went to building the facilities used in the 2019 SEA Games, we must see to it that the transactions related to this project did not violate existing laws and policies, and were not prejudicial to the public. Mukha kasing naluto ang agreement na pinasok ng BCDA at, dahil doon, nalugi ang gobyerno at ang publiko,” Hontiveros said.
Under the JVA signed in February 2018 by BCDA President and CEO Vince Dizon, who is currently facing graft and corruption charges before the Office of the Ombudsman in connection with the conduct of the 2019 SEA Games, MTD was to “advance” the entire project cost of P8.5 billion, while BCDA was to provide the land on which the facilities would be built.
However, Hontiveros noted that MTD actually advanced nothing as the capital it was supposed to provide was funded by a P9.5 billion loan from government-owned Development Bank of the Philippines (DBP) which was approved in March 2018, one month after the JVA was signed in February. Aside from being contractually obligated to facilitate the loan, the BCDA was also obliged to reimburse MTD for the capital it had supposedly “advanced”, which the BCDA did in December 2019, when it paid the full amount of the loan using a P9.544 billion appropriation in the 2019 national budget.
Thus, the project was funded not by capital from MTD Berhad, as the “Joint Venture” would make it appear, but rather by taxes paid by the Filipino people.
“Maliban sa construction cost walang inambag o binuhos na pera ang MTD, dahil kinuha sa bulsa ng taumbayan ang pambayad sa inutang na kapital nitong pribadong developer. What is this supposed joint venture for when BCDA used public funds to pay for the amount that should have been shouldered by MTD?” Hontiveros asked.
“Punung puno ang transaksyong ito ng bahid ng pagiging pekeng joint venture. Hindi natin pwede palampasin ito, dahil nagastos ang P9.5 billion na magagamit sana ngayon panglaban sa COVID o kaya ay ayuda para sa Kabikulan matapos ang bagyong Rolly,” she added.
Hontiveros then said that the Senate should also inquire if the P9.5 billion credit arrangement facilitated by BCDA was a “behest loan,” or a loan granted to firms favored by top government officials.
“Noong February 2018 nang pirmahan ang joint venture, at noong March 2018 may P9.5 billion loan na ang private partner. That’s seems too fast. Bakit hindi ito magawa para sa ibang proyekto ng gobyerno?,” she quipped.
“And without the involvement of the BCDA, would this loan have been granted at such record speed?”
She pointed out that the JVA between BCDA and MTD was red-flagged by other government agencies, such as the Commission on Audit (COA), which said in its 2019 Annual Audit Report that the project should have been been structured as a Build-Transfer arrangement under the Build Operate Transfer (BOT) Law.
The COA said that the JVA arrangement “was prejudicial to the interests of the government because, among others, the project should have gone through the more stringent public bidding requirements.”
Thus, it also appears that the project was packaged as a joint venture to evade the rules on public bidding.
The senator also said that the Office of the Government Corporate Counsel (OGCC), under its former chief Rudolf Jurado, initially issued an opinion adverse to the project, stating that it should have been structured as a build-transfer and not a joint venture.
However, after Jurado was replaced by Elpidio Vega, the OGCC issued a new opinion declaring the JVA to be above-board, “reportedly after undue pressure from the BCDA.”
“The public deserves answers to the many questions surrounding this project. I hope the Senate can get to the bottom of this issue at the soonest possible time,” Hontiveros concluded.