Sunday, May 8, 2011

Navy to bid out feasibility study on military land lease

By Alexis Romero
The Philippine Star, Sunday, May 8, 2011

MANILA, Philippines - The Philippine Navy plans to hold a bidding on a contract to conduct a feasibility study on a plan to lease military land to bankroll its modernization program, Navy chief Vice Adm. Alexander Pama said in an interview Tuesday.

“We want to determine how to use these assets and how to optimize their benefits,” he said, adding that the bidding is open to firms engaged in consultancy and related services.

Pama said the need for a feasibility study was raised by the Navy Public-Private Partnership (PPP) Office, which was formed last March. “We are now in the process of finalizing the recommendations. We will conduct a feasibility study on the areas that may be covered by the PPP,” he said.

Pama said among the Navy assets that may be leased is the Bonifacio Naval Station in Taguig City. The naval station houses the Navy Sea Bees, the Navy Intelligence Security Force, the Navy finance center, and commissaries.

Pama said they have to secure the approval of the Department of National Defense before they can proceed with the bidding. The Navy has not set a timetable for the feasibility study but is hopeful that this would start within the year, he said.

“The law requires that we conduct a bidding. We cannot rush these things. We want to have complete transparency,” Pama said.

He said the Navy is still determining how much would be spent for the study, which “will be dependent on the terms to be discussed (with the winning bidder). We are now looking into the budget as well as the programs to be covered (by the study).”

The Armed Forces of the Philippines (AFP) Modernization Act, which took effect in 1995, gave the military an opportunity to modernize its equipment and facilities in 15 years, with a total funding of P331 billion.

More than 16 years have passed since the law was enacted but critics said the AFP is not even close to a modern battle force. The delay in the implementation of the law has been attributed to lack of state funds.

During his first State of the Nation Address last July, President Aquino said he is studying a proposal to lease military lots to support AFP modernization. He said this will allow the military to procure equipment without bloating the budget deficit.

A private firm, Malaysian Resources Corp. Berhad, has submitted a proposal that would involve leasing a 33-hectare property at Fort Bonifacio.

The Navy has bared plans to set up a foundation that will gather assistance from private firms and individuals as it looks for resources to upgrade its capability. The Navy foundation will accept and consolidate all types of assistance extended by private donors.

Navy data indicate that out of the 53 patrol ships in the inventory, only 26 are operational. The average age of these ships is 36.4 years, though bigger vessels such as the minesweeper frigates are 66 years old while patrol craft escorts are 67 years old.

Only three of the seven Navy transport vessels are operational and are already 15 years old. The non-operational vessels are 64 years old.

On the other hand, only four of the 10 Navy auxiliary ships are operational. From among the 32 small crafts, 23 are operational and have an average age of 21.3 years.

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