It has become such a full-blown issue. The first time I heard about the NBN-ZTE controversy, I felt like it was just merely yet another jar that the administration people had gotten their hands into—-and being caught yet once again. For certain, the ZTE issue becomes now an unfastened Pandora’s box, and everything now is in wide disarray. In fact, this issue finally became the source of an impeachment proceeding to be filed against COMELEC Chairman Benjamin Abalos, just when he is about to retire from public service. Imagine a cyclone approaching land-base and then the destruction it leaves behind when the faintest wind finally stopped.
It is worth noting at this point how the whole shenanigan had started and progressed into the huge mess that it is right now. GMA News offers this very concise timeline of the ZTE deal, from the time it was offered by the government of China towards the time it was brought to the public eye as a full-blown controversy.
Bingskee over there at Warmstone had presented how the deal was so flawed in its conception that it is actually in direct violation of eight important laws, including the BOT Law and the Anti-Graft and Corruption Law. Being such, it is most probably a contract null and void from the beginning.
The main question or questions that the Senate hearings seem to have aimed at is whether or not the contract was in violation of established government policies and laws, especially the procurement guidelines set in such mode of governmental undertaking. Senator Francis Escudero was at his sharpest this afternoon and was in fact so effective in digging up mud, slowly but surely establishing the defects of the whole NBN-ZTE deal, being so haphazard in its preparation and hugely flawed in its execution.
Considering the amount involved (approximately $329.5 Million), the contract signed by DOTC Secretary Leandro Mendoza with the government of China had not obtained proper documentations such as the DOJ and DBM advises as well as approval from the Government Procurement Policy Board.
Despite that direct contracting is allowed within our governmental system, such is tolerated merely on very special circumstances like the procurement of necessary goods in times of urgency, such rice shortages due to calamities and the like, and only if it is done through a government-to-government agreement, thereby obtaining the character of an executive agreement (mostly undertaken through memorandum of agreements) and bidding and other regular procurement procedures would be set aside and done with in this manner.
Such is the general rule on special procurements done by the government. An example of this circumstance is the implementation of projects by World Bank and the International Bank of Rural Development Bank here in the Philippines, where mostly performance of contracts are done through sub-contracting and where bidding procedures are skipped in order to avoid any delay, selecting merely contractors from an accredited list. Other situations where public bidding is avoided is when the transaction is in consonance with a signed treaty or if the goods are for use by foreign-funded projects.
In the situation at hand, the ZTE contract is for procurement of infrastructure and not of goods as specifically pointed out by Senator Escudero, thereby very far from the safe embrace of executive agreements. It appears now that the contracting parties here have merely circumvented certain restrictions by using the special characteristic of an executive agreement.
Going to other matters, there is one salient issue that the Senate hearings have not so far tackled so thoroughly, or not even a slight indication to it. It should now be a question—-while the ZTE deal is under suspension from Malacañang and TRO’d by the Supreme Court—-of whether or not a National Broadband Network is necessary and very beneficial to the government and to the State as a whole. Former NEDA head Romulo Neri cited it’s very huge rate of return (at 29%) as a very strong motivation to procure it. Aside from that, the DOTC justifies it through a projected 3.6 Billion pesos yearly since the government is presently spending about 4 Billion pesos in telecommunication bills each year. The broadband network would also allow better interconnectivity among various governmental agencies and would allow the smooth and hassle-free implementation of new online services such as those being implemented by GSIS, where loans and other benefits could be obtained by just logging into the Internet and acquiring the proceeds from an ATM-like machine. One aspect of the planned infrastructure that the DOTC is highlighting (in its justification of it) is its VoIP capability that could save the government in long-distance expenses. In fact, it is foreseen that even the lowly barangay level government unit would be able to have access to inter-agency connectivity—-broadband and VoIP at that.
Of course, the private sector would frown on this as it would be losing from the income it usually generates from government activities. But that is beside the point if for example it is primordial for the government to be so effective in its communication and at the same time save on expenses. What would be a major issue by then is if ever the government—-with an infrastructure like the National Broadband Network—-would steal away business from private telecommunication companies, and while the constitution specifically forbid this kind of setup. With the NBN, it is projected that the government could be able to offer very low broadband rates to the public and beat the existing prices currently offered by private companies. Of course, this would particularly be beneficial to the ordinary Internet users, having access to very affordable broadband services. At present, the rates of broadband connection are far from being affordable to the average income earners.
Even Singapore is ambitioning of having a blazing speed Internet broadband network. But over there, the Singaporean government would be tapping the private sector to spearhead the installation of such and would merely be interfering in the initial stages—-unlike the NDN deal, where the government plays an active role in its operation.
The NBN would somehow be very beneficial by making available a much cheaper and faster connection into the Internet by government agencies, and possibly by the public in general.
CHED Chairman Neri was right to suggest that any procurement of such infrastructure in the future (in case the ZTE deal would be scrapped entirely) should be done through proper public bidding, in order that the government may gain mostly from it and not be worried with overpricing and substandard implementation as what is feared with this ZTE deal.
Photo: FreeFoto.com
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