THE House of Representatives supports the government plan to buy up equity in the Metro Rail Transit 3 for P53.9 billion so that it can resell it to private buyers and do away with the monthly payment of P600 million to a private consortium operating the rail system.
Catanduanes Rep. Cesar Sarmiento, chairman of the House committee on transportation, told radio dzBB on Sunday that the panel has set a hearing on Jan. 8 to iron out the mechanics of the buyout, which he said would end its contract with the Metro Rail Transit Corp. and spare it from paying the private consortium a guaranteed 15 percent return on investment.
While the Senate scrapped the P53.9 billion allocation for the buyout, Sarmiento said the government will have to find ways to raise the money.
Transportation Secretary Joseph Emilio Abaya said the President issued an executive order to pursue the buyout as early as 2012, but negotiations were stalled when the private consortium sought a temporary restraining order against the deal.
“There is an executive order to proceed with the equity value buyout in order to take over the MRT to put an end to the concession agreement so that the government will now fully and exclusively operate the MRT system,” Sarmiento said.
In scrapping the P53.9 billion funding, the Senate said the buyout would not result in any improvement in MRT services, which have deteriorated dramatically over the last few years.
But Sarmiento defended the plan to resell the MRTC stake to other private buyers.
“The MRT will be bid out to the private sector to end the current concession agreement. At least the government, just like in the case of the Light Rail Transit, would be able to negotiate the terms, draft a new concession agreement and guard against abuses in maintaining the operations of the MRT,” Sarmiento said.
Abaya earlier expressed frustration over the “unfair and anomalous contract” entered into by the previous administration.
But House Senior Deputy Minority Leader Neri Colmenares pooh-poohed Abaya’s statement, saying Abaya and the Aquino administration honored the anomalous contract and did nothing about the abuses.
In fact, Colmenares said the Aquino government imposed a 50-87 percent MRT fare hike to raise the P600 million monthly that would be paid the private concessionaire for its maintenance and operating expenses.
Sarmiento, however, argued that once the government takes over the MRT operations, it will be easier to improve services.
At the same time, he said the panel would summon transport officials to explain the fare hike imposed on Jan. 4.
“They may see the hearing as moot and academic because it will come after the fare hike was imposed. But we have to find out if the increases were justified,” Sarmiento told dzBB.
Sarmiento said the panel was considering implementing the fare hike on a staggered basis.
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