Contingency funds pushed for PPPs
The Department of Budget and Management has been asked to set aside money for financing unforeseen problems that could stem from the government's flagship public-private partnership program (PPP), said the country's Treasurer.
"We're managing now our contingent liabilities, particularly for those arising out of our PPP program. In fact, we have also submitted our recommendation to the DBM to include a contingent liability fund," National Treasurer Rosalia de Leon told reporters at the sidelines of the Economic Journalists Association of the Philippines' seminar at the weekend.
De Leon said they are looking at allotting some P30 billion for the purpose, adding that it would "take care... of some of the glitches of our PPP projects."
Asked why set aside the fund for PPPs, the Treasurer said, "It's just really more financing para in case na there are problems, in case lang naman yun e. So, it's really more precautionary."
There have also been inquiries by global debt-watchers on how the government will finance contingent liabilities arising from PPPs, she said.
Contingency funds are not part of the annual national budget approved by Congress. These can only be tapped when there is windfall income or when the government will borrow extra money.
Touted as the Aquino administration's flagship infrastructure program, the PPP program was unveiled to investors with much fanfare in November 2010.
So far, only three projects totaling P28 billion have been awarded, with the Ninoy Aquino International Airport Expressway Phase II bagged by San Miguel Corp. being the latest.
The second was the PPP for school infrastructure program awarded to consortium of BF Corp.-Riverbanks Development Corp. and Citicore Investments holdings, Inc.-Megawide Construction Corp., Inc.
Ayala Corp. won the the first project, the Daang Hari-Southern Luzon Expressway Link.