Twiddling your thumbs (Part II)
Let me continue what I started last week on what President Aquino’s State of the Nation Address should promise.
As a start, peg all applications for a government permit to a fixed time within which approval is issued, or not. Approval should be automatic if a decision is not made by the deadline. Call in outside experts to evaluate all bureaucratic procedures with the end in view of massively reducing the complexity and time. The President should require all departments to make the changes recommended and submit a list of ALL permits, licenses, approvals, etc. They will then be responsible for the time within which they will reach a decision or act appropriately. Those time frames should be short.
Couple this with a tie-in of local governments. Their convoluted procedures and inefficiencies often outweigh what even the national government can achieve. There should be compulsory training modules on good governance, effective management, and efficient processing. A number of mayors and governors lack the managerial experience the job requires.
Contracts must be fully honored, unless there’s provable corruption, or deliberate falsification by the contractor. If there’s reason to question a contract, you bring the two parties to a negotiating table. If that fails, you invite an arbitrator. If that fails, you go to court. It is only a court that can amend, cancel or suspend a contract. Contracts are immutable and must be honored if you want to attract investment, or anything else.
As to infrastructure, the concentration on public-private partnerships (PPP) is good, but government-funded construction must also be expanded, and rushed. The infrastructure allocation of 2-2.5 percent of GDP is less than half what it should be (elsewhere in Asia, it’s between 5 and 6 percent). The PPP projects listed that could possibly start might provide an additional 0.4 to 0.8 percentage point this year; the rest government should find. Getting tax revenues up to the 16-17 percent of GDP achieved in the Ramos era from the 12 percent today should just about do it. But rationalizing fiscal incentives and passing a sensible “sin tax” law (that could raise over P30 billion) are an essential part of the revenue-raising effort, and must be passed this year. They are also a necessary requirement for a credit rating upgrade to investment level. Achieving investment-grade rating will lower the country’s borrowing costs and help convince businessmen this is the place to invest. So it’s essential that Congress approve the proposed measures now.
Some projects I’d like to see rushed are the NLEx-SLEx connection, Cavite-Laguna expressway, Mactan-Cebu International Airport Development, LRT-2 East extension, and a new dam to provide water for Metro Manila residents.
Metro Manila has to get moving. People need to be able to move quickly from one place to another. Goods need to get to their destination. There are some key roads that can be expanded, but what should be done is something quite radical. Much of the gridlock on Manila’s roads can be removed with a couple of simple, no-cost orders that should be strictly implemented.
First, ban parking on all Manila (the physical GMA, not the biological GMA) streets. ALL, no exemptions. Roads you’d never think of using now will become alternate routes, thereby reducing traffic on the main arteries. Traffic can flow. It’ll be tough on those who wish to park on those roads or have nowhere else to do so. The government may have to spend here to build some free parking stations. Or have the private sector establish paid parking lots but—and this is essential—with a minimal, if any, cost for local residents who were using the road as their garage. There are empty lots around that can also be used. The cost in gasoline alone would pay for parking lots. A higher annual car registration fee could help pay for it and would be well worth it if you could travel quickly from A to B.
Then, to make full use of these roads, force jeepneys and buses to stick to the right-hand lane, overtaking not allowed. Fine heavily. And take half of the half-full buses off Edsa. They are totally unnecessary, and a major cause of the nightmare that is Edsa. To hell with the bus companies’ supposed rights, just do it.
But that just helps the motorists when the great bulk of people need public transport. Metro Manila has probably some of the poorest systems in the world (the World Economic Forum ranked Philippine infrastructure 105th out of 142 economies). The interconnection of LRT 1 and MRT 3 must happen, not just be talked about. The extension of LRT-1 to Cavite seems on track, but the eminently sensible MRT-7 has been languishing for 12 years now. Tong Payumo of the Bases Conversion and Development Authority has expressed support for the proposed construction of a monorail around Makati. That seems to make good sense, and certainly should be looked into by experts. The NorthRail project is back on the drawing board 14 years after its inception. The project is now “officially suspended.” There’s also been no progress in the SouthRail project.
But there’s another, far more vital, infrastructure that needs attention: water. I’m not going to talk about the shipping industry. It’s such a disaster, and hugely expensive (shipping goods in a 20-foot container from Manila to China costs close to P11,000, and from Davao to Cebu, around P35,000). It’s dangerous, too, with some 6,000 deaths in the past 20 years, and a big number of serious accidents. I’ve sailed across oceans, but I wouldn’t step on a domestic boat, let alone leave the harbor on it. The overhaul here is so massive I don’t even know where to begin. I’ll talk more about water, the stuff you drink, next week.
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