THE NATIONAL  BROADBAND  NETWORK:  TALE  OF  THE  STOLEN  CONTRACT

MANILA, JUNE 25, 2007
(STAR) HINDSIGHT By Josefina T. Lichauco - I recently participated in a round-table discussion sponsored by the Action for Economic Reforms (AER). The executive director, Filomeno Sta. Ana, did an excellent job of managing the discussion with quite a number of participants. AER is in partnership with EPRA (Economic Policy Reform and Advocacy), which is based at the Ateneo Professional Schools in Rockwell. Former NEDA director-general Dr. Cielito Habito chairs EPRA.

The theme of the discussion was “Private Sector Participation in Infrastructure,” with a specific focus on the National Broadband Network (NBN) contract of the Department of Transportation and Communications (DOTC), which indeed has become very controversial because of the contract amount of US$333 million, or about P16 billion, under a tied loan with China, the terms of which one can hardly call “favorable.” Under other “tied” situations that I have experienced in the past, the interest rate was certainly much lower.

The lead discussant was Assistant Secretary for the Telecommunications Office (the former Bureau of Telecommunications) and concurrent deputy commissioner of the CICT (Commission on Information and Communications Technology), Atty. Lorenzo Formoso. The invited guest, I was informed, was DOTC Secretary Leandro Mendoza, who sent a representative in the person of Asec. Formoso.

I don’t think anyone was prepared for the sensational shocker of the day, when Formoso’s response to the question, “Where is the contract?” was, “ It was stolen!” What made everything else taken up that day anti-climactic were his added words about the theft of the papers: “It’s a national shame!”

We concerned citizens of the Philippines are indeed entitled to a copy of the contract with such a huge amount to be borrowed in order to finance it, in view of the fact that there is an unsolicited BOT proposal involving a much lesser amount. But being BOT, there will be no money given by the government and without the certainty of enormous operation and maintenance expenses and problems that will plague the DOTC.

Add to this the fact that the contract is first and foremost a violation of Section 22 of RA 7925, of the Omnibus Election Code, and of the Procurement Reform Act. Since a colleague of mine in this paper, Jarius Bondoc, has been writing on this, I will refrain from writing more about the details of the contract except to dwell on the theft of contract papers, which Asec. Formoso called a “national shame.”

And a national shame it is! What makes it even more mystifying is the fact that there were no copies available for the concerned citizenry.

How could a theft of this kind happen? Weren’t the government authorities, including the office of the President, concerned at all about this theft of contract papers, which must have happened close to two months ago? DOTC Secretary Mendoza and the vice president of the contractor firm signed the document in the presence of the President of the Philippines. It was such an important occasion that Mrs. Arroyo flew to China to witness the signing of the contract and flew back home on the same day, reportedly because of an ailing husband.

What really happened to the signed contract? More importantly, what indeed was the motive behind this theft? Who would have the motive to steal it and gain from its theft?

The last question begs a limited number of possible answers and scenarios. For me, the shocking thing was the fact that the DOTC official directly charged to carry the contract through — meaning, to execute the contract with ZTE — has said that this theft is a national shame.

I told him during the discussions that he is my hero for saying that, but in my books, he would be a greater hero if he also called the ZTE contract a national shame.

In my 19 years of government work, I have never, ever heard of contract papers being stolen, or even lost. In both cases, the person tasked with its safekeeping should be answerable for gross negligence in the performance of his functions.

We cannot help but believe Formoso who, as the discussions commenced, even said that perhaps he should plead the Fifth Amendment and not respond to the answers.

But why? What is so secret and so incriminating about the ZTE contract that it was lost so soon after it was signed? Who stood to gain from the theft? Why hasn’t the official who had physical charge of them been made to explain, and explain posthaste, about the circumstances of the theft?

It is my guess, however, that the DOTC will soon announce the recovery of the contract papers, and that they were not stolen after all.

It would be good for us to remember what Churchill said in one of his speeches: “The most striking contradiction of our civilization is the fundamental reverence for truth which we profess, and the thorough-going disregard for it which we practice.”


Chief News Editor: Sol Jose Vanzi

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