Solons upbeat on San Miguel Corp.’s Naia rehab contract

MANILA, Philippines — Several lawmakers on Friday aired their optimism over the contract awarded to San Miguel Corporation (SMC) for the rehabilitation of the Ninoy Aquino International Airport (Naia).

Albay 2nd Dist. Rep. Joey Salceda on Friday said that Transport Secretary Jaime Bautista and Finance Secretary Ralph Recto were able to lock the best PPP deal in the country’s history, as the P170 billion for the rehabilitation would be the biggest PPP project ever.

BH party-list Rep. Bernadette Herrera said she is cautiously optimistic about the deal, while Ang Probinsyano party-list Rep. Alfred delos Santos said expectations will surely be high since a lot of travelers have complained about Naia.

“The SMC proposal offered an eye-popping 82.6 percent government share out of airport revenues, not to mention an upfront outright payment of at least P30 billion to the government,” Salceda said in a statement.

 “(I am) getting the proponent to do immediate improvements to the airport.  Immediately, there will be enhancements. I’m getting the proponent to commit,” he added.

Among the immediate improvements, Salceda said, are the installation of walkalators along the full length of Terminal 3, the interconnection of Naia Terminals 1,2, and 3, and better lounge facilities for overseas Filipino workers.

 According to the lawmaker, the other bidder offered a 76 percent government share which is lower than SMC’s proposal.

“The SMC proposal still yields them an internal rate of return of about 11.4 percent, which is lower than the allowed Bulacan airport IRR of 12 percent, after which government gets everything earned,” he said.

“As an advocate of air passengers’ rights, I remind the San Miguel Corporation-led consortium that was awarded the rehabilitation and operations contract over the Ninoy Aquino International Airport to make sure all NAIA clientele will be accorded utmost respect, fairness, and world-class standards of service,” Herrera said.

“I am optimistic but cautious.  The contract was awarded because the government wants to fix the long-broken system at NAIA. Public patience has been worn thin. The new management should understand that the public and Congress will not have reasonable but thin tolerance for mismanagement, mishaps, and mayhem. While we expect transition kinks, those should be kept to a minimum or none at all,” she added.

Herrera also said she is open to seeing slight increases to terminal fees but reminded that these should be coupled with significantly better services.

“I am open to affordable and reasonable increases in fees for as long as travelers will see value for money and  immediately feel significant improvements in services, courtesy, client experience, and much less corruption at Naia under new management,” she said.

Earlier it was announced by Bautista that the Naia rehabilitation project was awarded to the  consortium led by SMC — the SMC SAP & Co. Consortium.

Transportation Undersecretary Timothy John Batan pointed out that the entire project development process for this Public-Private Partnership (PPP) only took about 12 months.

“This process is one of – if not the fastest – solicited PPP project of the Philippine government,” Batan said during the press briefing.

“Effective and efficient operations of NAIA will have an immediate impact on the entire civil aviation system, including, hopefully, faster flight turnaround times, much less downtimes and flight delays, more flights between NAIA and other airports of the country,” delos Sntos said.

“Transformative reforms are the high expectations. We expect that NAIA, under new management, will retain only what is good from the old ways that remain relevant to future operations and shed off everything that tarnished the reputation of NAIA and the country,” he added.