More glitches of privatized MRT3 in 2016 bared

From How Travel

#PeoplesSona2017/ Research group IBON attributed Metro Rail Transit Line 3’s (MRT3) more frequent breakdowns to the privatization of the rail transport. The group reminded government that passing on to corporations the State’s role to provide the people with a rail transport system, as with other basic utilities, has by experience been at the expense of the public.

The group commented on the Commission on Audit’s (CoA) annual report on the Department of Transportation (DoTr) citing an increased occurrence of glitches in the MRT3 last year. South Korean Busan Transportation Corporation took over the maintenance of the rail service in January 2016 under a four-year Php3.81-billion contract following private corporations that have all failed to maintain the line.

More than half a million of daily MRT3 commuters have had to live with the increasing incidence of rail disturbances, said IBON. The CoA observed that during the first year of the contract, passenger unloading, train pullout operations and service interruptions have increased by 164%, 20% and 26%, respectively. Busan has also been found to have lagged in the overhauling of light rail vehicles at 1/13 for the entire year of 2016. Worse, all 48 of the new coaches worth Php3.76-billion remain inoperational.

IBON added that the public continues to bear the cost of a privatized MRT3. Under a 25-year Build Lease Transfer (BLT) contract with the Sobrepeña and Manuel V Pangilinan group-owned MRT Corp. (Metro Rail), the DoTr, for instance, continues to pay rental fees that include equity rental payment guaranteeing an annual 15% return of investment and payment of Metro Rail’s US$485.5-debt to the project’s financiers.  Meanwhile, under the concession agreement, commuters are bound to suffer periodically increasing fares, of which 85% goes to servicing principal and interest payments. The MRT deal has catered to private gain from the very beginning, IBON said.

The problematic Busan case points out government’s duty to take charge of the vital transport and to ensure that the public can access, utilize and afford it, IBON said. Involvement of any profit-seeking business entity in a government program, whether it be in the form of hybrid public private partnerships (PPPs), old-style PPPs, unsolicited proposals or official development assistance-funded projects, warrants tight public scrutiny, said the group.

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