CoA: MRT-3 inconveniences increased under Busan contract

/ 06:09 PM July 02, 2017


The Commission on Audit has found that inconveniences at the Metro Rail Transit Line 3 increased even more in 2016, even after the Department of Transportation’s P3.81-billion contract with the current maintenance provider took effect.

In its annual audit report on the DoTr for the year 2016 dated June 23, the CoA observed various deficiencies and lapses after the joint venture led by Busan Transportation Corp. took over the maintenance of the decrepit rail system effective Jan. 16, 2016.


As of Dec. 31, a total of P568.796 million was already paid to Busan net of penalties and other deductions. Despite that, the CoA said “the frequent incidents of train removals, service interruptions and passenger unloadings continue to recur.”

For one, 586 incidents of passenger unloadings were logged in 2016, a 163.96% increase from the 222 recorded in 2014.


Train removals, or the pullout of the train from the daily run, increased to 2,619 last year, 19.81% higher than the 2,186 instances in 2014. There were also 63 incidents of service interruptions caused by rolling stock failure, broken rails or system failure; this was 26% more than 2014’s figure of 50.

Unperformed services, unprocured parts

The CoA also expressed concern that Busan incurred P30.704 million in penalties and deductions last year because of unperformed rail grinding services and unprocured spare parts.

Even as penalties were meted out for the contract violations, auditors noted that these lapses may have a negative impact on the rail system.

“Although proportionate deductions were made from the monthly payments to the contractor, these could not outweigh its adverse effects on the safety of the riding public,” the report read.

Busan, however, explained to CoA that adjustments were made to the procurement plans “on account of the evolving system conditions,” and the contract allows for such deviations subject to the approval of the DoTr and MRT-3 management.

Refurbishing delays


The CoA also reported that as of Dec. 31, Busan has yet to complete the general overhauling of a single light rail vehicle, even as the contract required the completion of at least 13 by the end of 2016.

The accomplishment rates for four LRVs stood at 83.83%, 63.84%, 64.59%, and 34.41% as of Dec. 31, even as they should have been completed by Feb. 10, March 7, Apr. 2, and Apr. 28 last year.

At year-end, liquidated damages already amounted to P46.36 million, which the CoA said has yet to be imposed.

The CoA noted that in April, Busan explained to the MRT-3 management that its work was hampered by the availability of the original equipment manufacturer spare parts.

As for the total replacement of the signaling system, the accomplishment rate was only 6.85% by the end of 2016, even as the completion date of May 31, 2018 is targeted.

Busan blamed the DoTr for its failure to timely evaluate and approve its designs; it also claimed that the true accomplishment rate was 51.7%.

The DoTr acknowledged the audit team’s observations and said it was closely working with Busan for better services by ensuring maximum availability and reliability of trains. The MRT-3 management also wrote CoA on May 26 that train availability increased and disruptions went down in the early part of 2017.

Busan, meanwhile, said it offered assistance on its own initiative and even completed the grinding of the rails which was not finished by the previous contractor.

The CoA recommended that the DoTr study if Busan’s explanations deserved credence and consider engaging the services of an accredited rail expert to assess the maintenance provider’s performance efficiency.

‘Poor planning’

The same report blamed the DoTr’s “failure” to provide a reliable train system on its “poor planning and other major procurement lapses.”

The CoA zeroed in on the waste of P3.76 billion to buy 48 new train coaches for the Metro Rail Transit Line 3, which are still inoperational.

This “puts into question” the DoTr’s overall capacity to undertake the Capacity Expansion Projects Lots 1 and 2, which seeks to expand the MRT-3’s capacity and upgrade the system to accommodate an increased fleet size.

The CoA said that as of Dec. 31, only nine of the 48 LRVs, or 19%, were installed with the on-board automatic train protector (ATP), the part of the signaling system which electronically connects the trains with each other. During the exit conference last May 26, the number increased to 28, according to MRT-3 officials.

Incompatible trains

Yet, with Busan’s ongoing replacement of the signaling system, the ATP system installed in the new trains supplied by CRRC Dalian Co., Ltd., may well become worthless. This was cited as the reason for Undersecretary for Railways Cesar Chavez to seek the partial termination of the Busan contract.

Still, the CoA said the ATPs were not fully compatible with current signaling system upgraded by Bombadier Transportation under a separate P53.37-million contract.

The DoTr told the CoA that masures are underway to make the Dalian-supplied LRVs compatible with the system so the new trains can finally be used.

The CoA also reported that Dalian failed to comply with the delivery schedules, which provided for the delivery of three trains every month from October 2015 to January 2017. All 48 were delivered by January 2017, but that was because Dalian caught up with the delivery lag beginning August last year.

Even if the 48 LRVs were usable, the 2016-19 contract with Busan also effectively restricted their optimal use because it provided for Busan to run a maximum number of 20 trains during peak hours and 15 during off-peak hours.

The DoTr was entered into the controversial contracts during the term of Secretary Joseph Emilio Abaya under the Aquino administration, which has been criticized for its inability to resolve the public transportation crisis. JE

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TAGS: Audit, Busan, Commission On Audit, contract, maintenance provider, MRT, MRT 3, Transport, Transportation
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