Joint MAP-MBC Membership Meeting

Delivered October 6, 2011
at the Hotel InterContinental Manila

Thank you very much Ramon for your kind and gracious exaggerations about me. Going through the introduction gave me an opportunity to go down memory lane and I suddenly feel older and more tired than I did when I first came into the hall.

To Ed Francisco of the MAP, to all of the Officers, Boards of Governors, and Members of the MAP and MBC, and to all the other friends – ladies and gentlemen, good afternoon.

I’m very happy to be here. I was looking forward to this occasion with keen anticipation as a homecoming of sorts. I note many familiar and friendly faces, acquaintances in the audience—people whose paths I’ve crossed in the many roles that I have had in public life as well as in the private sector. I looked at my records and saw that the last time I addressed you my theme was ‘It can’t be business as usual”; I find that that dictum is as relevant today as it was then.

I approach my talk before you today somewhat like a road-show presentation or a shareholders’ meeting – where management discusses the organization – its structure and operations, analyzes its challenges, indicates the opportunities that it sees, presents its plans and shows how it will execute these plans.

It is in this manner that I come before you today to discuss DOTC … Mar Roxas wearing his technocrat hat – to seek your support, to invite you to put your stake in our plans, and figuratively and literally, to seek your approval and investments. I must inform you that I have a 19-page presentation, with handouts and a slideshow; but don’t worry, it’s only 19 pages because unlike the last time I was before you, I had to increase the font size of the letters of the page. When I took on this job, I likened my job at the DOTC to the establishing, maintaining and strengthening of the veins and arteries of the human body that transports life-giving oxygen and nutrients – in our case, people and goods, all throughout the system (the economy). I also saw DOTC for what it is: a support service, one that enables and empowers the people to go about their business. Accordingly, an uneventful day at the Department is a successful one; for us, truly, no news is good news.

Today I am even more convinced of the validity and appropriateness of these analogies. In the short time I’ve been at the DOTC, as part of ordinary course of business, we’ve reviewed, reconfigured and obtained approvals for nearly half a trillion worth of CAPEX plans for the country; gone through ups and downs and hard negotiating and dealing with international companies and their governmental backers (Germany, France and Japan), and you know what I’m alluding to; and, studied and mapped out the key points of intervention to make transport safer, more reliable and efficient for our people.

We also had to deal with: one bus, Dimple, flying off the Skyway resulting in seven dead and three seriously injured; Metro commuters threatened by a jeepney strike (that fortunately fizzled out), and almost daily service interruptions in the commuter rail systems that ferry nearly 1 million people to and from work every day.

We’ve also had to tackle four sea mishaps of note – a passenger ship from Cebu with 178 onboard that sank off Iloilo in clear weather; a large international flagged container ship colliding with a small bulk carrier that sank off Saranggani province (22 rescued and 1 dead) resulting in a 2-hectare oil spill; a RORO vessel with 36 people on board running aground near Mindoro (all 36 rescued); and, a fast craft headed to Cebu with some 220 on board, whose engine caught fire that also ran aground just outside Cebu, along a well-travelled route (all were rescued though 5 required hospitalization).

Whew! Just recounting these incidents makes me reminisce that I had less white hair 90 days ago.

I also recall when I took on this job, I talked (even sang) about “trains and boats and planes”. Here we are 90 days later and I realize I should have said something about roller coasters too!

But the DOTC is not all about mayhem on land and sea. On more congenial days I dig in with my new team to work on the myriad elements that drive the movement of people and goods all over the country; and the regulatory mill that ensures travel and transport are safe, convenient, affordable and reliable. Though seemingly random and a hodgepodge of events, I cited the examples I gave above in order to show you how I see the challenges confronting the department and how I’ve reorganized the DOTC in order to better respond to them.

Whereas in the past, the department was cut-up according to mode of transport – sea, air, rail and road – I quickly realized this was not the best way to organize ourselves given the wide range of problems and challenges present in each of the modes of transport. For instance, whoever I would put in charge of ‘Air’ would have to possess the skill set and temperament of a litigator, an operations man, a regulator, a project implementer and an investment banker. The problems and the work required in all the other modes of transport would similarly require these same complete attributes for whoever would be  assigned to them; an extremely difficult job even in the private sector, a near impossibility in the public sector.

Accordingly, I reorganized the department thematically, meaning according to the prevailing tasks I saw each of us having to perform. Regardless of mode of transport, these tasks would have to be attended to. Thus, the department is now cut-up according to the real time, modern requirements of Problem-Solving, Operations – day-to-day, including Regulation, Operations – Project Implementation including external affairs, and finally CAPEX formulation, planning and financing.

For each of these, I recruited top talent to match up with the tasks required, and I am confident they are up to the challenge. I’d like to introduce them to you: For Problem Solving – an Ateneo Economics graduate, a UP Law standout, a seasoned lawyer rising to lead Sycip Salazar’s Litigation Unit – Undersecretary Juju Lotilla, who I understand has had many of you as clients.

For Operations – day-to-day, including regulatory aspects – a UP Industrial Engineer graduate, #8 in his UP Law class, a seasoned lawyer in the private sector, 3 years as Undersecretary for the Department of National Defense in charge of operations, thus accustomed to large and complex organizations – Undersecretary Paeng Santos.

For Operations – Project Implementation, including external affairs – an Ateneo Law standout, also a seasoned lawyer in the private sector – particularly his stint with NGOs like PRRM and FLAG, with a 2-year stint as Undersecretary in DAR in charge of regional and country-wide projects, thus also accustomed to governmental ways and projects in the countryside, particularly dealing with LGUs – Undersecretary Efren Moncupa.

And finally for CAPEX planning, formulation and financing – a Stanford Economics graduate, an Ateneo Law honors graduate, PriceWaterhouse BOT structurer, a 5-year Baker & Mckenzie transaction lawyer and most importantly, a young entrepreneur – Undersecretary Timmy Limcaoco.

By the way, I have also recruited a well-established and highly regarded engineer and project manager Tito Aliling to help us with the civil engineering aspect of so many of the projects that we have to handle. Unfortunately, due to previous commitments requiring his personal attention and presence, he cannot be full time with us at the department.

All coming from the private sector, they’ve all taken pay cuts. They will have many sleepless nights on the job and more likely than not, won’t get any appreciation and instead only reap criticism. But I appreciate the commitment and patriotism by which they have cheerfully accepted the challenge and I ask you to give them all a round of applause.

You guys better savor that; that’s probably the last applause you’ll get.

Let’s go to some specifics – our role as a problem solver.

First, I see my team and myself as a collective problem solver. By reconfiguring, renegotiating or outright cancellation in certain cases, we have to solve big problems from some past projects that utterly violate the standards of a sound deal, whether because of corruption or technical fault – 3 immediately come to the fore: Northrail, PIATCO and GMA RORO ports, all multi-billion peso projects.

The Northrail project is currently on hold and we are in the process of “reconfiguring” it. While the government supports a rapid railway link to the North, we oppose the current contract, its technical specifications and its attendant arrangements. The reconfiguration will address all the numerous fatal deficiencies of the existing contract and we are hopeful of a successful outcome.

P-Noy very successfully convinced President Hu Jintao, Premier Wen Jiabao and Party Leader Wu Bangguo to be open to this and both the Chinese and PHL leaders have tasked the relevant ministers to attend to the said reconfiguration – an auspicious and good start to this effort.

How will it be different? This time, we want to be the ones to write the Terms of Reference. We will insist on an experienced rail construction contractor. We will insist on a bidding for the contract and we will insist on making payments only after acceptance by the client – in this instance the Republic of the Philippines. In short, this time, we want to rewrite the existing lopsided contract to our mutual advantage.

This time, instead of a train that will go from Caloocan (some 15 kms short of the CBD) to Mabalacat, Pampanga (another 15 kms short of the airport), the reconfigured project will link CBD Metro Manila to Clark. This time we will get tracks that are Standard gauge, that are able to handle heavier loads at faster speeds, instead of the older technology of a Narrow gauge. Moreover, this time we will ensure that what gets built is as what was originally intended, in this case, a fast speed rail link whose target travel time for the 90 km stretch will be a reliable less than an hour, and we not allow it to metamorphose, thru change orders, into something else, like it did presently, a slow commuter train with some 12 stops.

In short, think Hong Kong Airport Express!

Another big item in the problem-solving agenda is the NAIA Terminal 3 case involving PIATCO. The legal situation is quite straightforward though still being appealed: international arbitration bodies and domestic courts already have ruled in our favor, the government’s favor. The Supreme Court has ruled that the contract is fatally defective and thus void from the very beginning.

The Government position is that we will pay JUST compensation, underscore JUST!

In fact, we were prepared to adopt a fair value assessment based on the international practice of having 3 international appraisers -value engineers assess the value of the structure with the midpoint being the agreed upon value. Well, the contra-party rejected this approach and insisted on their claim of some $800 million for a project with a turn-key contract of about $350 million. You be the judge as to whether this would be acceptable, whether for your own companies you would pay the former amount.

By the way, for the record, there is no and there never was a contractual relationship between the Government, the Republic of the Philippines, and Fraport. So I find it absurd that Fraport seeks compensation for the consequences of acts it solely and voluntarily entered into with Piatco! The contracting parties were Fraport and Piatco. It was Piatco’s contract with the Government that the Supreme Court ruled on as being fatally flawed and void from the very beginning.

In short, if they find themselves disadvantaged because they were not in control while having financed the whole project, well then who told them to enter into a dummy relationship to begin with; who told them to keep shelling out money for what were non-recoverable, and probably off book expenses?

It’s very clear, the turnkey contract of Takenaka, the general contractor, was about $350 million. The claimed value by Piatco, including Fraport, was in the neighborhood of $800 million. Why should we pay a tenth beyond what was structured before?

Don’t get me wrong. I am not looking for trouble. We want to establish a fair value so that the government can promptly pay the contractors, including Piatco and take the project to completion. But we will not pay a cent beyond what is proper. In the meanwhile, we are decidedly and deliberately moving on to settle issues on the structural integrity of the terminal as well as arranging with either Takenaka (the original contractor) or other contractors for the completion of all the other work that has to be done to put the airport Terminal 3 up to fully operational status. Once we are through, we will have a reliable, convenient and safe terminal for the public.

By the way, as an update, in my talks with Takenaka, we are setting up a meeting in Japan to try to thresh out the outstanding issues between Takenaka, the general contractor, and the Republic of the Philippines, who would be the ultimate owner and beneficiary of the structure.

On the GMA RORO Port, this P15.7 billion project is another problem we are trying to solve. Presently, we have informed the contractor of our position which is to suspend the contract. You all already know why we find this project objectionable – for example: the fact that its design is not suited for PHL tidal, wind and wave sea conditions, the fact that out of the 72 locations where they were to be installed, some 50 already had port facilities in place, the fact that the local designed cement facilities were about half the cost of these imported ports.

Think about that – nearly P16 billion of your money, the taxes that you pay. Moreover, there was no site inspection, no endorsement from regional development councils, no economic and financial viability studies, and no environmental compliance certificates! In short, the project bypassed the proper budgetary, environmental and procurement processes that are the norm for any such procurement.

What to do? Review, renegotiate, and align with the rules and get the most value for the peoples’ money.

As an update, we presently are in talks with the proponent company and they have expressed a willingness to renegotiate the contract. The government has convened a working group composed of the DOTC, the Philippine Ports Authority, the Office of the Solicitor General, the government’s lawyer in these cases, and the Department of Finance, to handle the financing (which is JICAfinanced), to set the parameters for the negotiation.

Our position is clear – negotiate for a ‘Quantum Meruit’ that will pay for the work actually done or for the materials that were actually delivered and in the process, cancel the onerous contract.

The second role we perform at DOTC is that of the Regulator of the entire transport industry. We shall be strict, consistent, effective, fair and transparent in order to protect the public from the horrifying scourge of transport-related disasters, deadly sea catastrophes, buses falling from the Skyway and airports with less than fully modern navigation facilities.

The life of every passenger on land, sea and air is of primordial importance. And what more important way to measure our performance at DOTC than by our safety score for our passengers. We aim to protect every Filipino who gets on a bus, boat, plane or train.

As applied to the road transport mode, for example, in the granting of Route Franchises for buses and jeepneys, the LTFRB and LTO shall determine, for every such route, a demand and supply equation to preclude congested routes and underserved passengers. We shall only grant a franchise if there is a demand for it, and we will withhold franchises or employ natural attrition when transport supply exceeds passenger volume. Except for routes that clearly are in need of additional transport capacity, we shall suspend the granting of franchises until this comprehensive assessment is done.

Moreover, over the next several years, through a combination of incentives and regulation, we will increasingly make younger the fleets of buses, jeepneys and taxis on the road.

This will equate to less carbon dioxide in the air that we breathe, less breakdown of vehicles and less accidents in our traffic, and for the owners and operators of these vehicles, more fuel efficiency and less operating cost.

Presently, jeepneys have no age limit. Buses have a 15–year old limit; taxis,13 years and AUVs, multicabs and vans – 10 years. Over time, we will steadily reduce these age limits. Already, for taxis we are engaging the industry so we can implement a fleet age target of 7 years.

Accompanying this, we will randomly but rigorously implement drug testing for drivers and emission testing for vehicles. Drug users on the wheels and smoke belchers are both a bane to public safety.

To do away with the medieval quota system of compensation for bus drivers, we are teaming up with DOLE to push for a fixed pay for them. This will soon be a requirement for obtaining bus franchises, so that bus drivers don’t go battling each other recklessly in chasing for passengers, posing a danger to themselves, their passengers and other motorists and pedestrians.

We also already have a working partnership with the DILG and PNP to get the anti-colorum campaign in high gear.

In 1987, we had one of the deadliest maritime disasters in history, the Dona Paz that caused the death of more than 4,000 people. In 2008, we had the Princess of the Stars disaster where about 700 people perished.

This is unacceptable. We intend to make safety standards enforcement a religious vow in the department. No more “business as usual”, “okay lang yan”, or “pwede na yan” attitudes. This goes for the sea captains who are drunk on the bridge, or bus drivers on drugs, or, the owners of ships, buses and all forms of transport who cheat on proper safety and maintenance.

They will not find an inch of sanctuary or protection from the Board of Marine Inquiry, the Coast Guard, the MARINA, the LTFRB and LTO and the CAAP and MIAA as regulators of each mode of transport. We will make every official accountable and weed out the negligent and the incompetent.

Our aim is to reduce the window for any untoward incident by eliminating the Kapabayaan, the Kakulangan and the Katangahan so that, knock-on-wood and God forbid, if anything does happen it is indeed truly an accident, an unavoidable force majeure.

We are making some progress. Last week, at the height of typhoons Pedring and Quiel, we had no sea mishaps because we were firm and proactive in setting the rules. When the appropriate weather signals were hoisted, we didn’t allow ships to leave port.

In the past, sea captains had the discretion on this matter. Now we’ve set up a protocol where at the first level, ships are properly advised of possible danger to their passengers; once objective standards on inclement weather are met, this is followed by an unconditional order to hold anchor at port. The Coast Guard and the Philippine Ports Authority will prevent departure of ships from the port, and MARINA will certainly initiate franchise cancellation proceedings against shipping companies violating any of the standards or any such orders.

We have also revised the structure of “incentives and burdens” in the maritime sector to favor safety and prevention of incidents. We have put in place regulation such that in the event any incident occurs involving any vessel in a fleet, the entire fleet automatically shall be grounded.

Once compliance with safety standards of the other vessels on the fleet are established, they are then allowed to continue with their voyages. This is the opposite of past practice where the operations of all the other vessels in a fleet were allowed to continue even as one of their vessels was involved in an incident, as it was indeterminate whether the conditions of the vessel that were involved in the incident were also present in all other vessels in the fleet.

For the Air sector, our Civil Aviation Authority is focused on regaining our Category-1 status and meeting the international standards for aviation safety. The CAAP has been working on this over the last year and I have made attaining full compliance with the international standard one of my priorities. Out of the 127 total individual “Findings” by FAA and ICAO (25 are overlapping – both FAA and ICAO found the same items), we believe we have satisfactorily attended to all but 7. Among the remaining “open”, unresolved items are: the hiring of additional employees, the comprehensive training here and abroad for all CAAP inspectors, and the conduct of regular flight checks for pilots and aircraft. The FAA is scheduled to conduct a “Technical Review” sometime in December of this year; something like a midterm test, and we are optimistic about the progress we have made. The final test would be sometime next year.

Anecdotally, this is a good example where our cultural predisposition for the easygoing, “okey lang” and “pwede na yan”, “bahala na” clearly hurts us. The principal operating requirement for Category 1 status is quite simple: the setting up of objective international best practice standards and the unrelenting and rigorous application thereof.

For the CAB, this is the entity that negotiates test services agreements with other countries – we shall support modified open skies in order to support our country’s tourism promotion efforts. We shall be mindful though that this not to be at the expense of our domestic commercial airline industry. As I did at the WTO in battling for fair trade, likewise I shall be for fairness in the opening up of our domestic airline markets.

In these, as well as in all other regulations supervised by the DOTC, 24 by 7, we shall maintain the strict, consistent, effective fair and transparent standards in the application of these myriad regulations aimed at protecting the millions of passengers who use our public transportation system.

Another role we have at the DOTC is that of an operator or a custodian of strategic transport resources.

Let me talk about a couple – the NAIA. One of our top concerns is decongesting the NAIA. The airport facility is operating beyond its rated capacity, hence the 30-minute to 1-hour delays either at the terminal, on the taxiway or circling overhead.

Presently, there is an average of 43 movements (a movement is a landing or a take–off) scheduled every hour; this is beyond the weighted capacity of 36 movements standard (meaning one movement every 1 minute and 40 seconds). That’s the time it takes an airplane to land, come to appropriate speed and then taxi out to clear the runway.

Our goal is to increase the handling capacity of the airport by improving its “cycle rate”. We shall do this by constructing first, one then another rapid exit taxiway to reduce runway occupancy time; thus, shorten the 1-minute and 40-second cycle for each movement. This will take a few hundred million pesos and up to a year as we can only do construction work during the airports “downtime”, which is from 1am to 4am. Now, you get to see the kind of problems we have.

More near term, we also shall be reducing the load on the runway and taxiways by transferring general aviation to either Sangley and/or Lipa air bases. This is already in the works and we have started with the flying schools by restricting their takeoff and landing times, as well as helping them relocate to other sites. Private flights, particularly propeller aircrafts, will soon follow.

In terms of passenger number, it is notable that the NAIA airport terminal facilities – Terminals 1,2,3 and 4 – will hit its physical capacity limit this year. We are expecting to reach the rated capacity limit of 31 million passengers by year-end or if not, certainly by next year. Note that for Terminal 3, which has not yet officially opened, by 2010, last year, it already served about 10 million passengers (1.5 million international and 8.1 million domestic), which is the design rated capacity of the terminal.

The LRT-1 has been operating for some 30 years now; the LRT–2, for about 10 years and the MRT for about 11 years. The DOTC, through LRTA, operates both Lines 1 & 2 of the LRT, while we only have a coordinative role in the operations for MRT-3 because as you know, it is owned by a private entity. In all 3 cases, the maintenance of the lines are currently privatized. Collectively, the 3 lines serve about 1 million people every day. Notably MRT-3 is operating way beyond its rated capacity. Its rated capacity is about 350 thousand people per day and 11 currently it is operating at nearly 500 thousand people per day, which is the major cause for breakdowns.

As a window to see how messed up rail transport planning has been over these last decades (I’m not pointing fingers here but this is the fact), all 3 lines have different physical specifications: meaning sizes, engines, signaling systems, types of LRVs or Light Rail Vehicles or cars. In short, there is no  interchangeability nor scale economy at all. Moreover, the ownership of MRT is with a private entity called MRTC, whose ownership and economic interests are in a complex arrangement to include the Land Bank and the DBP.

Anyway, it is no secret that the cars themselves, particularly for LRT-1 and more especially for MRT-3 are old and breaking down. Only about 100 of the LRT-1 cars of the original 140 are still working; the frequent service interruptions, near daily for MRT-3, demonstrate this as well.

We intend to resolve the breakdown and service interruption challenges by: expanding capacity – rehabilitating and rebuilding many of the 1st generation LRT trains and buying new trains for MRT; improving maintenance so it is preventive instead of curative, and if necessary, provide financing to the advance purchase of spares and replacements. We shall fix and replace the bogeys which hold the suspension and brakes for each of the cars and we shall likewise perform major track work and replace the air conditioning units of the vehicles. We shall replace and upgrade the signaling, communication and computer systems that run the trains. And we shall set new and more stringent standards with more serious penalties, in the outsourced maintenance contracts for each line.

The rough estimate for all this about P6.5 B (some $150 million) and we are hopeful about obtaining the money for this – even as we recognize that all the 3 train systems require ongoing and continuous funding support from the government. We will have more details on this in a few weeks time.

I will be discussing the extensions of LRT-1 to Cavite and LRT-2 to Masinag when I take up our role as Developer-Promoter in the next section. Finally, we perform the role of Developer-Promoter … indeed of the physical part of nation-building.

President P-Noy’s Infrastructure Program as it relates to DOTC amounts to nearly half-a-trillion pesos worth of transportation infrastructure projects over the next five years.

So as not to take up too much of your time, these projects are listed and described in the hand-outs. Please be mindful that this list is indicative and not set in stone.

The handouts identify and give you the mandate of each of the 19 agencies under the DOTC. You also have a sheet that tells you how congested the runway of station facilitities is at NAIA – to establish and clearly show that really, the entire operating day is quite filled up. And we have a section that talks about the President’s CAPEX program.

For land transport, we shall expand LRT 1 to add a line from Baclaran to Bacoor in Cavite. It will carry an additional 200,000 passengers a day and decongest the route for private vehicles. What’s unfortunate here is that when I was DTI Secretary some ten years ago, this project was already on a go but for variety of political and other possibly nefarious reasons, the contract with SNC-Lavalin, a Canadian company, one of the largest major contractors in the world, was cancelled. Others were invited to come in; eventually nobody came in and so here we are, 10 years later, and not a single nail has been hammered into this project. In any event, the estimated cost is about 80 billion pesos, 48 billion pesos for the superstructure and 38 billion for the rolling stock.

For the LRT Line 2 Masinag Extension, the 4-km extension costs about 12 billion pesos and will open up a huge part of Antipolo and Marikina area for denser development. It would bring its population closer to the metropolis, making it easier for them to commute to work.

The Puerto Princesa Airport is an upgrade to the present domestic airport. From the present 800,000 actual passengers that used the airport, it will accommodate up to 2 millions passengers at the end of the project.

Laguindingan Airport is presently under construction – it’s on track and it is expected to be finished by the end of next year. We are in the process of writing up the bid documents for the terminal O&M, which we will subsequently bid out in time for the completion of the airport next year.

For Bohol, the government is committed to a modern airport in order to support it as a tourism destination. This will involve a 2,500-meter runway, a new terminal building and up-to-date avionics and navigation systems. The only question now is whether we will build an entirely new facility in Panglao Island, which costs about 8 billion pesos or, use the present site in Tagbilaran extending the present

1500 meter runway by 700 meters, with an estimated cost of 4 billion pesos. So we are validating the cost and we will certainly choose the least cost alternative.

For the NAIA Terminal 1, we have short-term improvement plans to rehabilitate the entire Terminal 1 and this will include: renovating the comfort rooms, providing full WiFi coverage, creating more space in both the arrival and departure areas and generally making it more hospitable to users, even as we are developing, planning out the detailed engineering, lining up the financing and finally constructing the gateway airport of the future which will be in Clark.

Our plans for the Clark as our air gateway for the future are very much linked to the successful outcome of the reconfiguration negotiations on the Northrail project. We’ll have more updates on this after my trip to China. For all these projects, we shall employ the most efficient and least cost financing

structure. Whether it be via PPP/concession agreements, BOT, GAA, ODA or any combination thereof, be assured that we value your money, our people’s money, so we’ll spend it in the most frugal, efficient, effective way possible – the ‘Matuwid na Daan’ is also the ‘Matipid na Daan’.

In designing these projects and setting the specifications for each, we shall always gauge our needs against our means, and against what the true demand is for any of these projects.

I always use the example of buying a car. This is not an advertisement but I find it a good example. The Toyota line has a Tamaraw, Innova, Land Cruiser, or Lexus. Our finances are that for a Tamaraw, and possibly the reasonable aspiration is for an Innova and maybe because we have aggressive growth projections, we opt to think about acquiring a Land Cruiser. In the past, what actually was specified was a Lexus and then we overpay for it and that’s why maybe, many of these contracts are in trouble today.

But gone are the days when we’ll go for an overdesigned and expensive vehicle that we can’t afford and for which there is no demand!

More so, in the procurement of these projects we shall assiduously follow the relevant laws and established procedures for the same. My experience (trying to untangle problematic projects in my 4 years at DTI, investigating these anomalous contracts in my 6 years at the Senate and now my 3 months at DOTC, studying and unraveling these problem projects) is that shortcuts eventually, invariably lead

to delay and problems. Deliberate, clean and honest Procurement leads to good and stable contracts that actually get done!

As PNoy puts it, the people is best served by 5 R’s – the Right project at the Right cost, at the Right quality with the Right people, and Right on time. So there you have it – the DOTC as I see it and as how I intend to do my job.

I hope that one year from now, we can meet again in another shareholders meeting where I can report on the items I have presented before you today. I am hopeful that by then, I will be able to report substantial progress in executing our plans for our transport sector; and how, reverting to the analogy, by use of transplant or stent and by better diet, more exercise and a healthier lifestyle we’ve cleaned up the veins and arteries of the nations circulatory system, nursing it back to vigorous health.

Today, I have made a list of what we intend to do. Next year, we will be ready to give you our report card. We will show you how we spent your money, and you can rate our performance based on the criteria we have set.

You, together with all the Filipinos are our stakeholders, our shareholders, in the whole schema of nation-building.

I am glad to join you today, to be with friends and colleagues, to talk to you about the future of our great country.

Thank you.