THE public works and infrastructure sector is notorious for corrupt practices. Thus, the country suffers from bad roads, inferior buildings and ill-maintained ports. There is a general perception that contracts are being awarded through under-the-table deals and “commissions” given to authorized signatories.
There have been instances when projects that are reported as having been completed and have been fully paid for turn out to be ghost projects.
Even with safeguards put in place by government auditors, thievery continues to infect the system. Conviction of government personnel involved in corrupt practices has failed to dent dishonest civil servants, some of whom are not afraid to flaunt their ill-gotten wealth.
I remember talking to a former executive of a construction company. He said he could no longer stomach the culture of dishonesty in the Department of Public Works and Highways (DPWH) that he left his high-paying job and settled in New Zealand, among the most honest nations in the world.
The mechanism put in place in the books has proven ineffective against corruption.
Nobody is immune from the cancer that has ruined the department, its personnel and the projects meant to serve the public. They may not admit it, but DPWH workers know that they are looked upon with disdain and ridicule, which is unfair to those who are honestly performing their jobs.
On Aug. 11, the New Zealand Herald issued a 12-page feature entitled “Getting Smart about Infrastructure.” The articles shared a common stance: that government alone cannot finance the infrastructure to make New Zealand move forward.
With other demands to make the government responsive to the needs of its people, the government of Prime John Key has set aside $7.5 billion over five years to build and upgrade schools, roads, housing projects, hospitals and telecommunications facilities.
Major construction companies, after reeling from the recession, welcomed the stimulus package of government.
The mantra that seems to resonate is PPP, short for “Public Private
Partnership,” a model that “involves private sector finance, often incorporated into a single agreement between the public and private sector covering not only the provision of finance but also the design, construction, maintenance and operation.”
It differs from the current practice of government deciding on infrastructure projects, approving a budget, bidding it out to contractors, monitoring the projects and paying by phase of completion. Through investment in productive infrastructure, projects will deliver economic returns by boosting productivity.
The PPP Australian model, according to Graeme Hunt, has provided “novel methods of funding infrastructure, combining strong government support and robust private-sector involvement and discipline.” He reported that, “More than 50 completed public-private partnerships accounted for at least A$ 34 billion of infrastructure projects in Australia.”
Stephen Selwood, chief executive of the New Zealand Council for Infrastructure Development and who observed PPP in Sweden and Denmark, explained the process: “The private sector is contracted to Government or local authority to provide a service such as a road, which may or may not be tolled.
A road would then be built, operated and maintained for a set period-–typically 30 years or more-–for a monthly fee. At the end of the term you hand it back in a condition that was set out in the contract.”
The Philippine government should give a serious look at PPP as an alternative to the rotten public work and infrastructure sector in place. This may just address corruption in government and allow the nation to leapfrog with efficient infrastructure in collaboration with the private sector.