Not changing my mind on Vitangcol

About two months ago (April 5, 2014), this column gave Al Vitangcol excellent marks as general manager of the Metro Rail Transit. Some excerpts: “I may be sticking my neck out but if the man is corrupt, I am blind, deaf and dumb,” and his appointment “may be one of P-Noy’s best decisions yet.” The basis was detailed in the column.

Have I changed my mind after reading what has been said about him this week? Not an iota. Only consider that Vitangcol joined MRT-3 on Jan 2, 2012. In two years and four months, here is a partial list of his accomplishments that benefited the government, the passengers, and the employees:

• Cut costs of insurance from P200 million a year to P85 million a year. He saved at least P115 million a year, with more for next year.

• Cut costs of maintenance from $2 million to $1.15 million a month (from P93 million to P53 million a month for 10 months). The new contract is for $1.5 million a month. The savings on the first reduction amount to P400 million. Ironically, this is the contract that caused his removal.

• Increased MRT revenues (without increasing fares) by at least P1 million a day (P365 million a year) by tightening ticketing procedures through an internal audit unit that analyzed ridership, sales, cash transfer procedures, etc. Previously, different sets of tickets were being sold but didn’t get recorded.

• For passengers, instituted express trains, a passenger information system (you know which trains are coming when), a consumer welfare desk, four CCTV cameras in each station, metal detector pass-throughs, also in each station at no extra cost to the MRT.

The janitorial service agency increased the quantity of soap dispensers, etc., also at no extra cost. He cleaned up the stations and the trains, removed the commercial advertising, and relocated the vending stalls to give passengers more room (revenue from the advertising and the stalls do not accrue to MRT-3, anyway).

• Through his computer savvy, saved P50 million with a computer system that, aside from data-generating and -sharing, allowed management to know in real time where the potential trouble was and how to solve it.

One would have thought Vitangcol’s performance—i.e., saving the government about P900 million, looking out for the riding public—would be celebrated and held up for emulation.

That’s not what he got. On the basis of a newspaper column that appeared last May 26, he was relieved of his duties as MRT-3 head —summarily, on the same day, without due process. Somehow (“the Secretary would be pleased”) he was made to resign, and even that act was ignored (reportedly) by the President, who announced that he had fired him.

What did the column by Jarius Bondoc say? That Vitangcol “gave his uncle-in-law a P517.5-million service deal in 2012-2013” by virtue of the fact that this uncle-in-law, Arturo Soriano, “is one of six incorporators-directors of PH Trams…” That there was no public bidding, and that Vitangcol was in it all the way.

What’s the other side? For starters, the P517.5-million contract for more than nine months was originally a P350-million contract for six months. It was extended because the Department of Transportation and Communications wasn’t prepared to bid out the final contract until 10 months later.

Was Soriano with PH Trams when the contract was negotiated? No. He was no longer involved because when Vitangcol found out about his involvement, Vitangcol told him to divest his shares. In other words, PH Trams no longer had Soriano on board. And that’s where the eyebrow-raising starts. No one believes that Soriano would just sell his shares on Vitangcol’s say-so.

But look at it this way: If Soriano didn’t divest, there would be no contract, or CB&T (the lead in the joint venture) would get another partner. So even if Soriano didn’t want to divest, his co-incorporators would have forced him to.

Was the divestment for show only? If it were, and it was discovered, hundreds of millions of pesos in future contracts for the other directors would be imperiled. Do you think they would agree to such a thing just to accommodate uncle-in-law?

Why didn’t Vitangcol reveal this information to the DOTC? Well, what would he say? “Actually, my uncle-in-law was an incorporator in PH Trams, but he is no longer connected”?  Would the DOTC have said, “Let’s not give the contract”?  On what grounds?

But why no public bidding? Why the negotiated procurement? Because the emergency situation called for it. It was an emergency created by incompetence. It was only on Oct. 4, 2012, that the DOTC found out, through a letter from MRT Corp., that the responsibility for procuring the new maintenance agreement for MRT-3 had been transferred from the MRTC to the DOTC way back on Nov. 24, 2010.

Picture it: The original contract was to expire on Oct. 19, 2012 (after its fourth extension). The DOTC had two weeks to award the maintenance contract. If it did not, there would be hell to pay in terms of service breakdowns. It was only on Oct. 4 that the DOTC’s bids and awards committee (BAC) constituted a 9-member negotiating team to meet with prospective providers. Vitangcol was chair. But seven of the nine members were from the DOTC.

The emergency situation called for a negotiated procurement. Under the law, one potential provider would have sufficed. But Vitangcol’s team met with three possible providers: Sumitomo, the incumbent contractor ($2 million a month), CB&T-PH Trams ($1.15 million a month), and Miescor/Genials (withdrew).  And they submitted their findings to the DOTC BAC chair, Perpetuo Lotilla, on Oct. 12.

Now, I ask: What else could Vitangcol have done under the circumstances? Did he show a deliberate partiality to CB&T-PH Trams? Who was disadvantaged?