Professional Documents
Culture Documents
CBD - 20221118 - PCN Template Upper Banaoang - Pds Rev 8242023
CBD - 20221118 - PCN Template Upper Banaoang - Pds Rev 8242023
CBD - 20221118 - PCN Template Upper Banaoang - Pds Rev 8242023
1. Name
2. Brief Description
The Upper Banaoang Irrigation Project (the “Project”) involves the development of the
Malapaao River for an impounding dam for irrigation, fish culture, hydropower, and other
purposes. It is envisioned to cover the financing and construction of multi-purpose facility
with the following components:1
• Main dam
• Diversion conduit during construction
• Spillway
• Diversion tunnel
• Hydropower component2
• Irrigation and drainage networks
The project area is located in Northern Luzon, covering part of the provinces of Ilocos Sur
and Abra.3 The project area is composed of agricultural lands predominantly planted to
rice and corn with other minor crops like tobacco, garlic, onion and vegetables of various
types mostly planted during the dry season.4 Further, it is also intended to irrigate farm
areas that could not be served by the existing Banaoang Pump Irrigation System (BPIS)
in Vigan City in the case of shutdown of the existing BPIS.
Project benefits may include the increase agricultural production, create employment
opportunities throughout the year, maintain ecological balance and improve the (rural)
living environment through the provision of assured irrigation water.
● Present the major component/s of the project and the expected output/s to be delivered after
the investment/construction phase.
The Project aims to develop the potential of Malapaao River for an impounding dam for irrigation,
fish culture, hydropower, and other purposes.
The project scope includes financing and construction of irrigation facilities with the following
components:
1
FS Sec. 7.2
2
municipalities of Sto. Domingo, San Ildefonso, San Vicente and Magsingal
3
FS Sec.4.1.1
4
FS Sec. 1.4
Page 1 of 36
● Main Dam
● Spillway
● Diversion Tunnel
● Hydropower Component
● Access/Service Roads
● Indicate the location of the project, target beneficiaries, and perceived benefits from the
project.
● Ilocos Sur (Vigan, Bantay, San Vicente, San Ildefonso, Sto. Domingo, Magsingal, San
Juan)
● Describe how the private sector may be involved - role/s of the private sector, in what areas of
project implementation, operation and/or maintenance, perceived arrangement/s.
Page 2 of 36
● Environmental Impact Statement/Environmental Compliance Certificate/Certificate of Non-
Coverage
● Right-of-Way acquisition and resettlement action plan
3. Project Background
● Provide milestones and status in the development and processing of the project (e.g.,
approval of the masterplan, ICC/NEDA Board approval, issuance of Instructions to
Prospective Bidders, receipt of unsolicited proposal, etc.)
● Indicate previous and/or ongoing studies (and related studies) undertaken, their
recommendations, and highlights of decisions and actions taken, if any, on said
recommendations
A feasibility study was conducted for the Banaoang Irrigation Project by the National Irrigation
Administration (NIA), prepared by its Project Development Department (PDD) in 1998. It is
envisioned to provide year-round irrigation water to supply about 6,000 ha. with rice as the main
crop, covering the municipalities of Bantay, Magsingal, San Ildefonso, San Vicente, Sto Domingo
and Vigan.
However, this Banaoang Ppump Iirrigation Ssystem (BPIS) was not able to fully irrigate its design
service area of 6,000 ha. At present, only 800 has. is being served by this system. Reported by
NIA Officials and verified during field investigations, there are portions of the main canal with
elevation lower than the proposed service area. Hence, irrigation water cannot flow by gravity and
would require another pumping, which is not economically feasible for the farmers. In
addition, this system requires a high operational cost due to electric power requirements
for operation.
● Indicate difficulties encountered and/or issues raised in the development of the project.
● Discuss whether the proposed project to be funded under the PDMF is part/component of a larger
project financed through other schemes such as through ODA or GAA.
Ongoing approval of FS
Page 3 of 36
Page 4 of 36
Rationale of the Project
1. Sector
AGRICULTURE and FOOD SECURITY
2. Sectoral Context
● Present the project site/s and the site selection process; and discuss likely impact/s to target
beneficiaries.
The Upper Banaoang Irrigation Project, a twin project of Ilocos Sur Transbasin Project under the
Ilocos Sur Irrigation Projects (ISIP), intends to use for irrigation approximately 5,000 hectares
(available area) of agricultural lands for both wet and dry seasons with Malapaao River as the
main source of irrigation water. This will be conveyed by means of a diversion tunnel.
The project aims to develop the potential of Malapaao River for an impounding dam for irrigation,
fish culture, hydropower and other purposes. The project aims to irrigate farm areas that could not
be served by the existing Banaoang Pump Irrigation System (BPIS) in Vigan City and the
municipalities of Bantay, Sto. Domingo, Magsingal and San Ildefonso. It also aims to increase
agricultural production, create employment opportunities throughout the year, maintain ecological
balance and improve the living environment from the point of rural development through the
provision of assured irrigation water.
The project area has a total population of 76,513 with some 22,984 families. About 70% of the
households are Farmers (average of four per family member).
● Discuss how the project attains sectoral objectives and/or addresses gaps as may be
presented in sector master plans, if any.
***Stakeholders
The Local Government Units (LGUs) of affected locations, will be responsible for the specific sub
projects within their jurisdiction and the promotion of the interests of their constituents. They will
serve as the bridge for coordination of information from NIA to the concerned stakeholders and
affected population
The Office of the Municipal Mayor will be working with cooperating agencies in order to carry out
the resettlement action and support the enclosed plans regarding the livelihood of the affected
population in the Land Acquisition Resettlement Plan (LARP). Inclusive of these agencies are the
Department of Agriculture (DA), Department of Environment and Natural Resources (DENR),
Department of Health (DOH, Department of Social Welfare and Development (DSWD), Philippine
National Police (PNP), and the Provincial Appraisal Committee of the concerned provinces
Regarding issues on resettlement, the affected population will be arranged into associations of
homeowners. The Homeowners’ associations (HOAs) will be directly responsible for the portion of
the affected population they are governing. A Community and Development Plan will be prepared,
in consultation with their constituents. These HOAs will coordinate with NIA in gathering the
necessary amortization fees every month, for the purpose of ensuring that the lots are legitimately
transferred to the resettled population.
Page 5 of 36
Related to this are the Livelihood Development Groups, which serve to identify livelihood
alternatives and sources of income, and handle the training and assisting of capable PAPs. NIA
will be providing the seed money and technical assistance, and tapping relevant Non-Government
Organizations (NGOs) for the capacity building of PAPs.
The NGOs responsible for orienting the Livelihood Development Group will also administer
support to the affected population in the designation and application to their appropriate livelihood
projects. The designated NGO must be present and competent in the requisite expertise for the
efficient management of the Programs Activities Project (PAPs) concerns. They will receive
support from NIA and respective local cooperating agencies
● Project’s intents to support climate change resiliency and/or sustainable urban development
Various schemes were considered during the VE/VA phase of the Feasibility Study of the
project (dated September 2022)5:
Option 1 – Intake and High Density Poly Ethelyn (HDPE) Pine HDPE conveyance
Option 2 – Intake and Concrete Cut and Cover conveyance
Option 3 – Malapaao SRIP
After careful evaluation of the proposed schemes, VE/VA Study shows that Option 3 –
Malapaao SRIP is the most recommendable development option for the Project. The
Malapaao River Multipurpose Irrigation Project will cover the potential irrigable area of an
estimated 5,000 has inclusive of the service area of Banaoang Pumping Irrigation
System which has not been served due to elevation differences in the main canal.This
option includes an earth dam and reservoir to be constructed across Malapaao River at
Langiden, Abra from where a 7.6 km. tunnel will convey irrigation water from the
reservoir to the service area. The outlet of the tunnel will be situated in Sto. Domingo,
Ilocos Sur. This option has a potential of a power generation component as well. The
project area has a total population of 76,513 with some 22,984 families. About 70% of
the households are Farmers (average of four per family member).
The Project is also aligned with the irrigation sector “Modern Resilient Irrigation
Systems,” the irrigation development road map involving total projected area for new
projects is estimated to be about 681,709 ha for the period 2020 to 2030, under Scenario
1. This total area will come from new irrigation projects (314,516 ha), restoration projects
(190,052 ha) and multipurpose projects (MPs) (115,788 ha) by NIA while the rest
contributes towards achieving the medium-term plans and long-term vision, encapsulated
in the National Irrigation Master Plan 2020-2030 (NIMP) with long-term aspirations for
“Highly Competitive and Sustainable Philippine Farming Communities” thru a “Dynamic
Agency Developing and Managing will be contributed by OGA (NIMP, 2020-2030).
3. National Context
● Discuss alignment/consistency of the project with the Philippine Development Plan and its
5
Adoption of the NIA-Standard Terms of Reference (TOR) for the Conduct and Undertaking of
Detailed Engineering Studies /Design (DES/DED) of Storage/Reservoir Type Irrigation Projects to be
Procured Through Outsourcing Scheme.
Page 6 of 36
inclusion in the list of priority government programs/projects (e.g., Public Investment Program,
Comprehensive and Integrated Infrastructure Program, Regional Development Investment
Program, Provincial Development Investment Program, Local Development Investment
Program)
The latest Philippine Development Plan (PDP) 2011-2016 spells out the Ilocos Sur Irrigation
Projects (ISIP), this Project, as one of the thrusts in improving food security and increasing rural
income through enhanced farm productivity. This Project, which focuses on rice production, is
expected to complement the Government‘s Food Staples Self-Sufficiency Program (FSSP).
The ISIP is also in line with the sector outcomes of PDP’s Accelerating Infrastructure
Development by enhancing the performance of the irrigation sector thus enabling the development
in the energy sector. The power generation component of the Project will also help in augmenting
the demand in the Luzon power grid.
Agriculture is a major economic sector of the Philippine economy contributing an average of 20%
to its Gross Domestic Product (GDP). One of the primary objectives of the Government is to
increase self-sufficiency in rice. To attain this, there is a need to increase rice production through
the expansion of irrigated areas. The latest Philippine Development Plan (PDP) 2011-2016 spells
out the Ilocos Sur Irrigation Projects (ISIP), this Project, as one of the thrusts in improving food
security and increasing rural income through enhanced farm productivity. This Project, which
focuses on rice production is expected to complement the Government‘s Food Staples
SelfSufficiency Program (FSSP). The ISIP is also in line with the sector outcomes of PDP’s
Accelerating Infrastructure Development by enhancing the performance of irrigation sector thus
enabling the development in energy sector. The power generation component of the Project will
also help in augmenting the demand in the Luzon power grid. The conduct of the Feasibility
Study (FS), for implementation by the National Irrigation Administration (NIA) Regional Office in
Region 1, on Ilocos Sur Transbasin Project and Upper Banaoang Irrigation Project are integrated
into one project, hereinafter referred to as the Ilocos Sur Irrigation Projects. This final feasibility
report consists of results and recommendations based on the different surveys and activities
conducted throughout the course of the study. The conduct of the Feasibility Study (FS), for
implementation by the National Irrigation Administration (NIA) Regional Office in Region 1. The
Project is supportive of the thrusts of the 2023-2028 Philippine Development Plan (PDP)
under Chapter 5 (“Modernized Agriculture and Agribusiness”), particularly the
Government’s goal on maximizing the efficiency of agriculture, forestry, and fisheries for
food production. Moreover, the project’s focus on rice production is also expected to
complement the Food Staples Self-Sufficiency Program (FSSP) of the Department of
Agriculture (DA).
The project is also in line with the sector outcomes under Chapter 12 (“Expand and
Upgrade Infrastructure”) and Chapter 15 (“Accelerate Climate Action and Strengthen
Disaster Resilience”) of the PDP by enhancing the performance of the irrigation sector
and enabling development in the energy sector which must be adaptive and resilient
against shocks and natural disturbances, and also contribute toward a low-carbon future.
Page 7 of 36
Indicative Implementation Schedule
Milestone Period
Preparation of PDMF requirements until submission to PPP Center August – September 2023
and conduct of Preliminary Online Market Sounding
Completion of Secretariat Evaluation and PDMF Committee September 2023
Presentation
Transaction Advisory Agreement (TAA) Signing October 2023
Procurement of Consultants January 2024
Supplemental FS Preparation January-April 2024
Page 8 of 36
Approval Stage (ICC submission until NEDA Board Approval) April-August 2024
Preparation of Bidding Documents August -September 2024
Bidding Stage (Pre-qualification,Bid Proper and Bid Evaluation) October 2024-June 2025
Issuance of Notice to Award and Contract Signing June-August 2025
Project Development
MILESTONE* TARGET DATE
Submission of the Feasibility Study August 2023
Submission to ICC for Approval November 2023
*May also indicate other important milestones and/or activities the Agency has or is committed to accomplish.
*May also indicate other important milestones and/or activities the Agency has or is committed to accomplish.
Page 9 of 36
Support Requirements (applicable to projects that would require PDMF Support)
1. Major Outputs
Scope of Transaction Advisory Service
The project is being proposed for PDMF fund support to ascertain its viability for PPP
implementation. Generally, the scope of work shall cover the following:
1. Updating of FS/Due Diligence Studies. Preparation of a due-diligence report
including validation and, if necessary, updating of existing Feasibility Study for the
Project. The due diligence narrative report shall include the validated/updated
feasibility study of the TRMP which shall cover, among others, the technical,
financial, socio-economic, environmental, and legal aspects, and PPP Project
structure.
Page 10 of 36
output.
Soil and Land Classification - Undertake soil and land classification survey, which includes, but is
not limited to: soil classification, area distribution by soil series/types and mapping units, soil
physical and chemical properties, land classification, land classes, area distribution by land classes,
present land use, and area distribution by land use, etc. to provide sound basic data essential in
solving the agronomic, economic and engineering problems associated with the development of
irrigation works.
Surveying and Mapping - the activity should be conducted to produce maps representing the
actual ground conditions, specifically, defining the exact position and elevation of natural and
man-made features; water and flood levels; reference and newly established control points, etc.
in accordance with the Terms of Reference (TOR) for Surveying and Mapping Activities
encapsulated in MC No. 84 s. 2019, or as amended, necessary in the preparation of feasibility
study level engineering design and analysis.
Geological and Geotechnical Investigation - the activity, in accordance with MC No. 85 s. 2019 or
as amended, should be conducted to determine the following:
Development of Feasibility Study (FS) Level Design and Drawings - The Consulting Firm shall
develop conceptual design that will include the following, as a minimum:
Page 11 of 36
Dam and Appurtenant Structures
General Layout showing the Dam, extent of the Reservoir, Transmission Pipe alignment, Access
Road alignment, Diversion Tunnel alignment (if required during construction), hydroelectric power
plant (HEPP), surge tanks if required, penstock alignment, tailrace alignment, Water Treatment
Plant (WTP) and all other appurtenant structures (e.g., regulating structure, outlet works, spillway,
and so on) that may be required;
Plan, elevations and typical sections of the Dam including other appurtenant structures (e.g.,
regulating structure, outlet works, spillway, flood gates, and so on) as may be required;
Plan, elevations and typical sections of the HEPP including layout of turbines and switchyard (if
required);
Plan, elevations and typical sections of the WTP including layout of process tanks and equipment
(if required); and,
Plan, profile and typical sections of Transmission Pipe, Penstock and Access Road (if required).
Hydraulic analysis for the sizing of diversion conduit, spillway, sluice gate/s, ogee weir, pump and
other related structures;
Inflow and Outflow Hydrograph of Spillway and Conduit;
Stability Analysis;
Dam Break Analysis;
Pump capacity (for pump scheme);
Area elevation capacity curve); and
Grouting Plan (If necessary).
Environmental and Social Assessment (ESA) – Identify positive as well as negative environmental
and social impacts related to the project such as, but not limited to:
Page 12 of 36
drainage basin or catchment area, drainage investigation, annual precipitation, evaporation
losses, flow measurements, rating curves, daily discharge, daily water production especially during
the dry season, flow duration curve, dependable flow at the proposed water supply intake
structure, sediment loading, verification of existing water right with water balance analysis and
flood studies. Additionally, assess the water quality to determine its suitability with various crops.
Develop a detailed historical climate and water resources database for the proposed project.
Organize the data in electronic form in order to allow future data entry/updating, and a fast way
of retrieving for various purposes.
Hydropower Component Analysis - Prepare feasibility level outputs considering the current peak
demand, as well as projections into future peak demand, documenting the viability of the project
works, including the hydropower component with cost of transmission and distribution lines
including right-of-way (ROW), while adequately addressing hazards and risks, environmental
issues, and resettlement issues, outlining in detail the implementation arrangements.
The technical, environmental, institutional, social, market, demand, and other aspects of the
hydropower component (e.g., a preliminary business case study) shall also be included. The
analysis should also involve a grid impact study.
Moreover, the existing institutional arrangements regarding the development, construction,
operation, and management of the hydropower component shall be investigated by the
Consulting Firm, including the institutional linkages between NIA and other relevant agencies on
development and implementation of the hydropower component.
Economic and Financial Cost-Benefit Analysis - The proposed F/S shall include an economic
analysis, which will consider the economic costs (at constant prices and excluding price
contingencies) and both quantifiable and non-quantifiable benefits of the project. The quantified
benefits shall be evaluated “with” and “without” the project scenarios. Additionally, assessment
of benefits shall consider the potential impacts of rice tariffication with or without HEPP. The
analysis shall determine the economic internal rate of return (EIRR) and economic net present
value (NPV).
In addition, sensitivity and risk analyses shall be performed to assess the effects of changes in the
value of certain economic cost components and benefits on the viability of the project. The results
shall be presented together with recommended actions or variables to monitor during
implementation and operations.
The financial analysis shall focus on the financial IRR (FIRR) and financial NPV calculation, as well
as sensitivity analysis. The costs (capital and annual operation and maintenance [O&M]) shall be
detailed and shall be prepared at constant prices (<Insert Year>) and split between foreign and
local costs. Inflation-adjusted costs shall also be prepared to take into account inflation effects
over the project’s implementation period. The costs, therefore, should include detailed design and
construction supervision as well as price and physical contingencies.
Page 13 of 36
● Enumerate specialists required with their corresponding field of expertise (and/or required related field) to
deliver the major outputs. Special emphasis is given into enumerating sector-specific experts (e.g., Railway
Engineer, Highway Engineer, Civil Aviation/Airport Operations Specialist, IT/MIS Specialist, Civil Engineer)
including tasks to be performed by each. To the extent possible, minimum requirement for experience,
involvement in projects, and number of projects completed, among others, should be included.
Suggested format:
With National Expertise
Expert 1: Qualification:
Page 14 of 36
conduit design; transfer to electro-mechanical
K. Prepare necessary quantity and cost estimate needed by the Economist to carry
out an economic and financial analysis, which may include options for
hydropower development
L. Prepare the feasibility grade designs & plans of dam, hydraulic/design
computations and of appurtenant structures/facilities.
M. Provide editable and traceable electronic copies of plans, layouts, and other
drawing, preferably in CAD file (.dwg), spreadsheet (.xls) and pdf file of items
enumerated in Item o of this sub-paragraph.
N. Review the hydraulics and structural aspects for the power components and
appurtenant structures; and
O. The expected output data for engineering include but are not limited to the
following:
a. Scheme of Development
b. General Layout (overall scheme)
c. Dam Layout
d. Plan, profile & cross section of Spillway (storage scheme)
e. Plan, profile & cross section of Conduit (storage scheme)
f. Flood routing of spillway & conduit
g. Flood inflow & outflow hydrograph
h. Stability Analysis
i. Dam Break Analysis
j. Pump capacity (for pump scheme)
k. Area elevation capacity curve
[P.] The above cited drawings must be made/printed out in A3 size format. In
addition, title blocks must be affixed therein with the appropriate signatories.Work
with other specialists in the team in preparing specifications of all civil
works to be included in the Minimum Performance Standards and
Specifications (MPSS) and Key Performance Indicators(KPIs).
Expert 2: Qualification:
Page 15 of 36
river source to establish a reference base flow. Use at least 2-3 models for
comparison purposes.
D. Perform flow duration curves using daily discharge data.
E. Provide the reviewer an editable spreadsheet file (electronic copy), preferably in
MS Excel format, the hydrological data used (rainfall, streamflow, evaporation,
etc.) for validation and to facilitate faster review. Electronic copy should be
submitted on or before the submission of the draft feasibility study report.
F. Estimate the Irrigation Diversion Requirement (IDR) using ten (10)-day rainfall
derived from daily rainfall of at least 30 years data series, soil type parameters,
agronomic data and other pertained to analysis at various cropping calendar to
determine the least irrigation diversion requirement applying water balance
analysis. Also, estimate the irrigation diversion requirement using zero rainfall for
extreme events. Include the climate change scenario using PAGASA criteria for
ready reference;
G. Perform Water Inventory Survey / Report. In case there are several water
users/water permit grantees or irrigation systems drawing water from the same
source and basin, present the list of water users and perform systems / basin
water balance;
H. Perform hydrologic analysis for various schemes/alternative sites, taking into
account also a case where hydropower generation is included.
I. In case of reservoir type of dam, perform the detailed reservoir operation studies
following the parameters set by NIA using decadal (ten-day) simulation derived
from daily data of at least 30 years streamflow data at multiple water levels using
single crops or multi-crops (diversified crops as recommended by the Agronomist
and the Soil Technologist) as an input for a wider range of economic evaluation,
financial evaluation, etc.;
J. Estimate proposed irrigable areas per dam site based on available/dependable
water supply;
K. Gather water samples on several floodways, proposed dam sites, and
groundwater wells for water quality testing and mapping of polluted/sea water-
intruded areas;
L. Carry-out sediment transport analysis for several floodways and each dam site for
the determination of sediment-discharge relationship and adjustment of sediment
rate suited for current conditions of the watershed. In case there is no
sedimentation study in the area, the empirical values may be used but should be
adjusted based on the current condition of watershed;
M. Conduct flood studies for different return periods. In estimating the unit
hydrograph, empirical methods can be considered. However, preference is given
to the use of actual peak discharge data from different flood events in the water
source or nearby rivers rather than the empirical dimensionless unit hydrograph
method. In case models will be used, provide at least 3 models for comparison
and provide parameters used and period of record.
N. Compute the design flood hydrographs for the following return periods: 2, 5, 10,
15, 20, 25, 50, 100, 200, 500, 1000, 10000, including the Probable Maximum
Flood (PMF);
O. Include the latest climate change scenarios in the hydrological analysis for flood
studies using climate change scenario projections set by PAGASA; and
P. Undertake other tasks/activities assigned/delegated by the Team Leader as may
be required during the conduct of the Study,
Expert 3: Qualification:
Page 16 of 36
irrigation project with high dams, hydropower, and/or
water supply.
A. Review relevant geologic reports from other agencies (e.g. MGB, PHIVOLCS,
etc.) and any relevant research papers and update geologic parameters
considered in the old studies, if any
B. Conduct Engineering Geological and Geohazard Assessment (EGGA) following
the list of geohazards in DAO 2000-28 to identify potential geo-hazards and
assess the susceptibility of project components to these hazards.
C. Conduct deterministic and probabilistic seismic analysis on critical areas, such as
the proposed dam site, main canals and tunnel alignment, if any, and recommend
seismic loading for design. Should also identify the Maximum Design Earthquake
(MDE), Maximum Credible Earthquake (MCE) and Operational Basis Earthquake
(OBE). Seismic assessment should consider earthquake generators within 100 -
300 km radius and earthquake epicenters within 50km radius from the project
site.
D. Conduct detailed geologic mapping at the dam site and reservoir area, including
the tunnel alignment if any, giving emphasis on the lithology, geologic structures
(discontinuities) such as joints, faults, beddings, lithologic contacts, degree of
weathering and their relevance to the engineering properties of the rock masses.
Discuss the type of excavation materials to be anticipated during construction and
applicable method of excavation.
E. Conduct slope stability assessment of the dam abutments and tunnel alignment
when applicable, applying rock mass characterization/rating systems (any of the
following systems: Geologic Strength Index (GSI), Slope Rock Mass Rating
(SMR), Rock Mass Rating (RMR), and Slope Stability Probability Classification
(SSPC)) and include kinematic analysis for the geotechnical units identified in
order to provide recommendations on the safety and stability of the foundation
including optimal slope angle of future cut-slopes.
F. Conduct subsurface geological investigation by core drilling along the dam,
spillway and conduit alignments and test pitting in canals, including the necessary
field tests as stipulated in the TOR for Subsurface Geologic and Geotechnical
Investigation MC No.85, s. 2019, or as amended. Any deviation from the TOR
arising from circumstances encountered in the course of the investigation should
be discussed with the NIA geologist prior to implementation. The factual report
shall be submitted for review and acceptance by the NIA geologists.
G. Provide literature-substantiated interpretation of data:
a. Standard Penetration Test (SPT) results to compute for allowable bearing
capacity for structures not requiring bedrock foundation;
b. Water pressure test results to compute for Lugeon and coefficient of
permeability values and conduct seepage analysis along the dam axis;
c. Laboratory test results to determine the strength parameters of the drill
cores as foundation materials.
Page 17 of 36
a. Determine potential borrow areas, preferably but not limited to 5km radius
from the dam site, and locate and supervise the conduct of test pitting;
b. Sampling and laboratory analysis of construction materials shall be
conducted upon the commencement of the subsurface investigation
c. Collect samples of embankment materials and concrete aggregate
materials strictly following acceptable standard procedures and submit
samples to credible laboratories for testing;
d. Interpret the test results to determine the engineering properties of the
available materials;
e. Estimate available volume of each construction material type (clay core,
random fill, concrete aggregates, boulders etc.)
I. Ensure the inclusion of the following maps in the FSR:
a. Engineering geological maps of the dam site and reservoir area, as well
as the tunnel alignment if any, with a readable scale (1:1000 to 1:5000)
for the dam site and 1:5000 to 1:10000 for the reservoir area and with
superimposed alignments of the project components, boreholes and test
pits.
b. Geological cross-sections of the dam, spillway, and conduit axes showing
lithology and lithologic contacts, discontinuities and assumed level of firm
foundation (limit of excavation), and tunnel alignment when applicable,
showing the degree of weathering, hardness and discontinuities numbers
as described MC No.85, s. 2019, or as amended.
Note:
● The specific details concerning the frequency, location, methodology, etc. of
items B and C shall form part of the Consultant’s Inception Report and Work Plan
which shall be subject to consultation with and approval of NIA.
● The Consultant should notify NIA geologists, through the regional office
concerned, if drilling has already commenced for them to conduct joint field visit
with the consulting geologist to observe on-going drilling activities and to have a
general appreciation of the geologic setting of the project site. This is to facilitate
efficient review of the Geology chapter of the FSR.
Expert 4: Qualification:
Page 18 of 36
A. Review of relevant maps and survey data for FS Level including all survey data
done by conventional/ground/terrestrial survey method, topographic maps and
NAMRIA Control Points (PRS-92 and MSL). All data must specify and secure
certification from data source;
In case that the existing available Topographic Maps covering the project are
more than five (5) years old, Re-Survey is required in order to have accurate and
precise data considering climate change adaptation in the Philippines. However,
the Implementing Office may opt to lower the said limit for areas affected by
catastrophic events. Furthermore, topographic maps less than or within the
prescribed limits, shall be subject to survey map test validation for both the
control and the terrain of the said map.
All data extracted from Satellite Images, Aerial Data, IFSAR Data, LIDAR Data,
NAMRIA Maps, and Vector Maps are part of Initial/Pre-FS Level only, thus must
specify the source & procuring party and shall secure a clearance certificate
unless otherwise stated by the law;
B. Prepare Base Map showing the delineated Service Area, Reservoir Area,
Watershed/Drainage Area, Dam Axis location, Main Canal and Tunnel/Link Canal
Alignment, reference ground control point (GCP), existing NAMRIA Control
Stations and the newly established NIA GCP;
C. Prepare write-up/ Scheme of Survey Works for the proposed areas and location
of irrigation facilities such as; Dam site area, Reservoir area, Service area, Main
Canal and Tunnel/Link Canal Alignment and the Establishment of Horizontal
(PRS-92) & Vertical (MSL) Control Points, secure NAMRIA Control Point and
surveying instrument calibration certificate used in the proposed project;
D. Monitor/Supervise the Conventional/Ground Surveying and Mapping works of
Dam site area, Reservoir area, Service area, Main Canal and Tunnel/Link Canal
Alignment and the Establishment of Horizontal (PRS-92) and Vertical Control
Points (MSL) and provide the Topographic Survey data, Leveling and Traverse
data & computation and other surveying computations, all tied to existing
Horizontal and Vertical Controls certified by NAMRIA;
E. Prepare and oversee the preparation of topographic, control network, profile and
cross-section maps based on the standard form and methodology of data
collection, processing, conventional/ground survey works and map preparation as
prescribed by NIA, including the Monument Description Sheets of the newly
established NIA GCP;
F. Responsible for the supervision, evaluation, extension of necessary
recommendations,
G. Conduct surveying and mapping works, if so required, in order to have updated,
realistic topographic maps and ground terrain surface model;
H. Prepare, collate and review End Products (e.g. topographic maps, survey data &
computation, instrument & NAMRIA Reference Control Point certification, and so
on) referred to the paragraphs A.) to E.) of the present Terms of Reference
(TOR) of this section; and
I. Undertake other tasks/activities assigned/delegated by the Team Leader as may
be required during the conduct of the study.
J. Work with other specialists in the team in preparing specifications of all
civil works to be included in the MPSS and KPIs.
Note:
The conduct of Surveying and Mapping activities shall be undertaken by a registered and
Page 19 of 36
licensed Geodetic Engineer pursuant to the provision of Republic Act no. 8560, otherwise
known as the “Philippine Geodetic Engineering Act of 1998” and NIA Memorandum
Circular (MC) 39 series of 2019. Relative to the Program of Work (POW) hiring of a
Geodetic Engineer is included in the personnel requirement (survey team) before the
conduct of surveying and mapping activities. See MC 176 series 2020.
The specific details concerning the location, methodology, etc. of items 3, 4, and 5 (e.g.,
Control survey, Topographic survey on the Dam site, Reservoir and Service area,
proposed main canal and tunnel/link canal alignment, Control Network Map showing the
newly established NIA horizontal and vertical controls and the existing NAMRIA Control
Points for future reference, and so on) shall form part of the Consultant’s Inception Report
and Work Plan, of which shall be subject to consultation with and approval of NIA.
Note: The detailed Cost Estimates for the Project are needed to ensure minimum
variation with the Detailed Engineering cost estimates. Other projections including cost
escalation if a delay of 2, 3, or 4 years occurs before project implementation must also be
presented.
Expert 6: Qualification:
Irrigation and Drainage The Irrigation and Drainage Engineer must have at
Engineer least a bachelor’s degree (preferably a Master’s
degree) in Civil Engineering or equivalent, with at
least seven (7) years of professional experience and
at least four (4) projects in the planning and design of
large-scale multipurpose irrigation systems.
Page 20 of 36
Duration of Engagement (in person-months):
Tasks
Page 21 of 36
price level; and
j. Cost of annual operation and maintenance of irrigation and drainage
facilities (including those of alternatives).
Q. Work with other specialists in the team in preparing specifications of all
civil works to be included in the MPSS and KPIs.
Expert 7: Qualification:
Soil and Land Classification The Soil and Land Classification Specialist must have
Specialist at least a Bachelor’s degree (preferably a Master’s
degree) in Agriculture General or with a major in Soil
Science or equivalent, with at least seven (7) years of
professional experience and at least four (4) projects
in the field of land resource planning and conduct of
soil and land classification activities in conjunction
with feasibility studies of irrigation projects.
A. Undertake relevant studies conducted in the project area such as old feasibility
study report, comprehensive land use plan, old soil survey and land classification
report, and other pertinent studies concerning the soil and land classification;
B. Collection and preparation of general layout and common base map;
C. Perform slope quantification for the determination and delineation of the various
slope classes based on topographic maps necessary in the delineation of
potential irrigable land;
D. The grid soil sampling methods must be used as a procedure for soil survey;
E. A semi-detailed soil and land classification survey must be used in the study;
F. Soil and land classification should be conducted using a topographic map
(NAMRIA) preferably 1:4000 or 1:20,000 and 1:50,000 scale supported by
satellite imagery through geographic information system for the purpose of
delineating the present land use;
G. The density of soil auger borings is equal to one (1) soil auger borehole per 20-30
hectares depending on relief or topography of the arable land;
H. The density of soil master pits is equal to one (1) soil master pit per 120-150
hectares of arable land depending on the identified soil series;
I. Prepare location maps for soil master pits and auger boreholes.
J. Composite soil samples (first and second layer of the soil only) from the individual
soil master pits must be collected and submitted to the accredited soil testing
laboratory for physical (texture, structure, bulk density, and color) and chemical
analysis (pH, organic matter, available nitrogen, available phosphorus, available
potassium, and cation exchange capacity);
K. Composite soil samples from three adjacent soil auger boreholes (surface and
plow depth soil only) must be collected and submitted to the accredited soil
testing laboratory for subjecting chemical analysis (pH, organic matter, available
nitrogen, available phosphorus, available potassium, and cation exchange
capacity) necessary for fertilizer recommendation of different crops;
L. Soil survey must follow the standard procedures and specifications for soil profile
survey and detailed process of soil profile survey and soil sampling as approved
and accepted procedure by the Bureau of Soil and Water Management;
M. For determination and naming of major soil series and soil mapping units used
the soil survey and mapping standards book published by the Bureau of Soils and
Water Management;
Page 22 of 36
N. Used the method for land classification in accordance with the United States
Bureau of Reclamation Standards except for some minor modification
incorporated to suit the local project condition;
O. The Geographic Information System (GIS) shall be used to improve the quality of
the measurements;
P. Coordinate with the project proponent such as NIA-Regional Office, Irrigation
Management Offices, Satellite Offices, Local Government Units, and other
concerned offices for the acquisition of pertinent information about the proposed
project especially in the service area.
Q. Undertake land use, soil and land class correlation to determine the soil series,
mapping units, and land classes based on physical and chemical characteristics,
topography, drainage, parent materials, etc. and design appropriate units for the
reports.
R. Preparation of land resources report which shall include but not limited to the
following information, data, and maps:
a. soil classification & soil mapping unit;
b. soil physical & chemical properties;
c. land classification & description of land classes;
d. present land use;
e. hectarage summary of soil series,
f. hectarage summary of major land classes,
g. hectarage summary of present land use;
h. soil map;
i. land classification map;
j. present land use map;
k. slope map;
l. location map of master pit and borehole samples.
S. Provide NIA an electronic copy of maps such as shapefiles, kml or kmz files
(google earth files), layouts, maps, etc. for validation and other supporting data
pertaining to the delineation of service area to facilitate the review process. The
data must be provided on or before the submission of draft feasibility report;
T. Provide NIA the authenticated copy of the soil laboratory analysis (physical and
chemical) for validation to ease the review procedure;
U. Collaborate with the hydrologist, geodetic engineer, irrigation & drainage engineer
and other experts (as needed) to determine the extent of potential irrigable area.
Expert 8: Qualification:
Page 23 of 36
C. Conduct farm management surveys through interviews of farmers in all the
municipalities/barangay covered by the proposed project based on the
boundaries set by the soil technologist and irrigation and drainage engineer. The
interview should cover at least 10% of the total number of farming households in
each barangay. Key information/data to be gathered must include but not limited
to the following: cropping pattern, utilization of agricultural inputs, cultural farm
practices and yield/production performances;
D. Coordinate with the barangay officials regarding demographic and agricultural
profile data. Key information/data to be gathered must include but not limited to
the following: demographic profile, land holding status, farm sizes, inventory of
farm machines and post-harvest facilities, financial/ lending institutions,
agricultural supply store, etc.;
E. Coordinate with the project proponent (NIA- Region, IMO, Satellite Office etc.) for
the acquisition of relevant information about the project. In case that an existing
irrigation system will be covered by the proposed project, key information/data to
be gathered must include but not limited to the following and must be signed by
the concerned head of office: Operations and Maintenance Report/ Seasonal
Report for the last five (5) years of operation, Irrigators Association Profile,
Seasonal Cropped Area, Cropping Pattern/Irrigation Scheduling, etc.;
F. Coordinate with the concerned agencies/offices (LGUs-MAO, MPDO, DA, etc.)
for the acquisition of relevant information. Key information/data to be gathered
must include but not limited to the following: city/ municipal agricultural profile,
comprehensive land use plan, etc.;
G. Consolidate gathered information and prepare the present agricultural situation
report. The report must include but not limited to the following information/data:
cropped area and cropping intensity, yield and production, inputs utilization, labor
availability and utilization, existing agricultural support services, etc.;
H. Identify major constraints faced by the farming communities in the service area,
which affects agricultural productivity and prepare an agricultural development
plan for the project to address these issues. The plan must include but not limited
to crop selection, proposed cropping calendar/pattern, recommendation on crop
management practices, yield forecast, estimates on available labor, strengthening
support services, etc.;
I. Collaborate with the soil technologist, hydrologist and other experts (as needed)
to determine crops that are suitable to be planted in the area. Selection must be
based on the following: environmental and agro-climatic condition, soil physio-
chemical characteristics, water availability, varietal adaptability,
marketability/profitability, available technology etc.;
J. Recommend a sustainable management practice for the proposed crop/s.
Introduce various techniques for land preparation, crop establishment, nutrient,
pest and water management, harvesting and postharvest operation.
Practices/techniques must be a result of experiments/studies from agricultural
agencies and institutions considering appropriateness (suitability) of the
technology and social acceptability in the project area;
K. Forecast the yield and production based on the availability of high yielding
varieties that are deemed suitable/adaptable in the area based on studies, and
the soil productive capacity (productivity index). Recommended crop
management practices, availability of improved technologies, sufficiency of
agricultural inputs etc. should also be taken as a consideration;
L. Estimate the labor available for agriculture using statistical data acquired from
authorized agencies (PSA, DA-BAS etc.). Prepare a monthly labor distribution in
order to ensure that there will be no delay/s of activities embodied in the designed
Page 24 of 36
cropping calendar;
M. Review and evaluate the adequacy and effectiveness of existing agro-institutional
and agricultural support services within the project area and recommend
programs for the required agricultural development to support the successful
operation of the proposed project;
N. Prepare the agronomy report and present the derivation of the following
data/information in present/without and future/with project conditions (wet/1 st and
dry/2nd cropping season): cropped area and cropping intensity, yield and
production, cropping pattern, agricultural inputs utilization, labor availability,
monthly labor utilization and balance, farmers’ distribution based on landholding
status and farm size and inventory of support services; and
O. Provide NIA an electronic copy (Excel format) of the consolidated raw data
(survey results) for validation and other supporting data (O&M, agricultural profile
etc.) to facilitate the review process. The data must be provided after the conduct
of the survey before the submission of the interim report.
Expert 9: Qualification:
Page 25 of 36
F. Estimate total Investment and Life-Cycle economic costs in coordination with the
Cost Engineer;
G. In accordance with NEDA-ICC Project Evaluation Guidelines and Procedures and
Project Development and Evaluation Manual (Vols. 1 & 2), estimate economic
viability indicators for the irrigation only case, as distinct from analyses taking into
account secondary benefits;
H. Furnish NIA Field and Central Offices editable e-copies of tabulated summary of
Survey Returns (preferably in MS Excel/Spreadsheet format);
I. Furnish NIA Field and Central Offices editable e-copies of the Economic and
Financial Analysis, and all sub-components and related analyses thereof
(preferably in MS Excel/Spreadsheet format).
Expert 10: Qualification:
Page 26 of 36
on the presence of IPs/Ancestral Domains;
[B.]
B. Assist the proponent in the conduct of FPIC process, whenever required, for the
acquisition of CP or CNO;
[C.] Establish baseline information of socio-economic condition of the community,
including Indigenous People (if there is any), within the project area including but
not limited to demography, health status, education, livelihood activities, existing
development plans/programs;
C.[D.] Conduct social surveys (KII/SES/HS/FGD, etc.) and public consultations to the
community/people affected by the project;
D.[E.] Present initial information on the affected people/household, land, crops and
other improvements, valuation of properties, compensation packages, etc. for the
formulation of Land Acquisition and Resettlement Framework (LARF); and
E.[F.] Identify impacts to the people and proposed mitigating measures
F.[G.] Prepare plan on Schistosomiasis management plan (on areas with
schistosomiasis issues), and;
G.[H.] Include Gender considerations in the discussion:
a. Collect sex-disaggregated data of users of the project.
b. Conduct gender assessment and analysis of needs of women and
men, as well as gender differential impact of the Project.
c. Review gender risks and develop mitigation measures.
d. Draft a gender mainstreaming framework for the Project based on
Philippine gender laws.
e. Prepare poverty reduction and social strategy frameworks (e.g.
resettlement plans) with recommendations for involuntary
resettlement, and gender safeguards in accordance with the
requirements in the Philippines
Page 27 of 36
Expert 13: Qualification:
Page 28 of 36
Expert 14: Qualification:
VE/VA Specialist (Value The VE/VA Specialist must have at least a Value
Methodology Associate) Methodology Associated (preferably Certified Value
Specialist) certifications or equivalent issued by the
Society of American Value Engineers (SAVE
International), Value Analysis Canada, Society of
Japanese Value Engineering or equivalent institutions
with at least four (4) years (preferably 10 years) of
professional experience and at least four (4) projects
in the field of Value Engineering/Value Analysis of
water resource projects.
Page 29 of 36
projects including extensive experience in financial
modeling; project structuring; risk analysis, allocation
and management; project agreements; and bid
process management.
Page 30 of 36
documents/agreements; procurement;
and bid process management.
Prepared three (3) PPP contracts.
1. Prepare LARAP that are adequate and compliant with the Philippines
requirements.
2. Ascertain the legal status and site availability of the additional lands that
may be acquired for the project.
3. Establish the appraised value of the lands and recommend the best
alignment and station and depot location in terms of its strategic
placement, ease of acquisition, security, etc.
Page 31 of 36
4. Conduct the household survey and make the necessary tagging for use in
the development of the compensation plan.
Page 32 of 36
Available Documents on the Project
● List current studies/documents prepared for the project (e.g., masterplans, pre-
feasibility study, business case, feasibility study, technical study, Information
Memorandum)
VEVA Report
1. VEVA Report
2. Feasibility Study Report (FSR) – this FS is intended for the implementation of
the integrated Ilocos Sur Transbasin Project and Upper Banaoang Irrigation
Project integrated. It shall cover technical and financial aspects of the proposed
irrigation project, including environmental study, vulnerability assessment,
preparation of sustainability plans, and analysis of alternative financing schemes.
The FS shall also ensure that value analysis/value engineering (VA/VE) is
undertaken for best possible options.
3. NIA Memorandum Circular (MC) Nos. 18 S. 2019 6 and 94 S. 20197 - While these
MCs are intended for the Conduct and Undertaking of Detailed Engineering
Studies /Design (DES/DED) of Storage/Reservoir Type Irrigation Projects, they
may also serve as an alternative guide for the experts’ qualification and tasks for
proposed PPP projects of NIA.
6
Adoption of the NIA-Standard Terms of Reference (TOR) for the Conduct and Undertaking of
Detailed Engineering Studies /Design (DES/DED) of Storage/Reservoir Type Irrigation Projects to be
Procured Through Outsourcing Scheme.
7
Section 20, Article II of the 1987 Philippine Constitution
Page 33 of 36
Legal Authority to Undertake PPP
● Discuss the legality of the agency entering into a PPP arrangement with the private
sector. The section describes the agency’s mandate including relevant laws and
policies that support the same.
The basic legal foundation of Private Public Partnership (PPP) in the Philippines is
founded under the 1987 Philippine Constitution8 which provides that “The State
recognizes the indispensable role of the private sector, encourages private enterprise, and
provides incentives to needed investments”.
9
, as amended
In line with this principle, the Congress enacted Republic Act No. 6957, as amended by” by”
10
RA 7718 . This broadened the list of PPP government implementing agencies such as
Government Owned and Controlled Corporations (GOCCs), Government Financing
Institutions (GFIs) and State Universities and Colleges (SUCs); putting in place incentives
for attracting private sector investments to venture into PPP projects; and allowing
negotiated unsolicited proposals provided that these comply with conditions outlined in the
law.
This law also provides the legal framework for the Build-Operate-Transfer (BOT) program of the government a
Under PD 55211, NIA being a GOCC is mandated under its charter to construct multiple-
purpose water resources projects designed primarily for irrigation, and secondarily for
hydraulic power development and/or other uses such as flood control, drainage, land
reclamation, domestic water supply, roads and highway construction and reforestation,
among others, provided, that the plans, designs and the construction thereof, shall be
undertaken in coordination with the agencies concerned.
The Agency adapted several PPP Policy Circulars12 approved and issued by the PPP
Governing Board. NIA Memorandum Circular Nos. 18 S. 2019 and 94 S. 2019 will serve
as a guide for experts qualification and tasks for proposed personnel to undertake PPP
projects of NIA.
To adapt to the fast-changing progress on the country’s development projects, the
provisions and the Implementing Rules and Regulations of RA 7718 have undergone
several revisions. The latest revision was approved by the BOT Law IRR Committee on
September 15, 2022. The Revised 2022 IRR was published on September 27, and took
effect on October 12, 2022. The Revised 2022 IRR of the BOT Law sought to address
stakeholder concerns on the financial viability and bankability of PPP projects, and
concerns about potential delays due to extra steps, rigid processes, or ambiguous
8
Further details are noted in the FS Sec. 7.4.
Act Authorizing the Financing, Construction, Operation and Maintenance of Infrastructur
9
An Act Amending Certain Sections of Republic Act No. 6957, entitled “An Act Authorizing the
Financing, Construction, Operation and Maintenance of Infrastructure Projects by the Private Sector,
and for Other Purposes
10
MC No. 26 S. 2015
11
Section 2 (b), RA 7718
12
municipalities of Sto. Domingo, San Ildefonso, San Vicente and Magsingal
Page 34 of 36
provisions.
Being a GOCC engaged in irrigation and related facilities, Buil d t-operate and transfer (BOT)13
will be the preferred PPP modality of the Agency for the Project.
Under this contractual arrangement, the project proponent undertakes the construction, including financing of a given
The NIA is a GOCC mandated to develop irrigation systems throughout the country to support the
agricultural sector whereby applying the reinvention’s principle it becomes commercialize and
competitive defeating its commitment to the public. It is my hypothesis that during the formulation of
the charter of the NIA (RA 3601, enacted in 1963), the Reinvention Model of reform in public
administration is deemed applicable considering that it is within the post-World War II era whereby
the World is in recovering phase especially, the Philippines so, the Philippine public administration
is inclined to promote entrepreneurial government and at the same time fulfilling its commitment for
public service. It is in the charter of NIA to collect an irrigation service fee for its stakeholders. In
fact, the amount paid by the farmers is deemed as modified form of return of investment for the NIA
although the same may be utilized to the construction, rehabilitation, and maintenance of the
irrigation facilities. Taking up the history of NIA aside from the reinvention model, it also dwells into
the concept of Reengineering whereby redesign and/or reorganization of structure is being
implemented. It is noted that the NIA from being a unit of the Department of Public Works and
Highways to the Department of Agriculture to an attached Agency of the Department of Agriculture.
The offices under the NIA had been divided according to the specialization of every unit; therefore,
in the workplace the skilled and multifunctional activities had been merged. The setting forth of
stages of processes within the office is being observed. Delineation of control and task had been
exercised. Furthermore, some analysts are suspicious of the long-term risks which private firms run
when they enter long-term partnerships with monopsonists, which many public sectors service
purchasers are, and argue that the results of such partnerships can be lower payoffs for the final
service user. (Hartley, 1997) However, if political realities mean that no other form of privatization is
acceptable, apart from allowing private sector firms to act in partnership with public agencies, then
New Public Management tends to welcome this partial move to quasi-market mechanism. (Bovaird,
2004) Some loose ends in the economic analysis of these propositions did give some concern,
even at the time when New Public Management was gaining ground in the public sector. For
example, public choice theorists continued to be skeptical of the argument for public sector
provision or regulation based on market failure, either because they believed that the market
failures were not sufficiently important or, alternatively, because they felt that the damage done by
public sector intervention would generally be worse than the effects of the market failures
themselves. From this perspective, PPPs do not go far enough-they are only half-way solutions and
outright privatization would almost always be preferable. (Bovaird, 2004) However, the perceived
role of PPPs was more affected by two other strands of economic theory-principal-agent theory and
transactions costs analysis. (Bovaird, 2004) At the very time that New Public Management was
becoming a highly successful paradigm in many countries, adherents of principal-agent theory were
beginning to cast significant doubt on the extent to which principals could influence agents to
undertake their commissions in a manner which was socially efficient. (Boorsma, 1998) Public-
Private Partnership (PPP) can be broadly defined as a contractual agreement between the
Government and a private firm targeted towards financing, designing, implementing and operating
infrastructure facilities and services that were traditionally provided by the public sector. It embodies
optimal risk allocation between the parties – minimizing cost while realizing project developmental
objectives. Thus, the project is to be structured in such a way that the private sector gets a
reasonable rate of return on its investment. PPP offers monetary and non-monetary advantages for
the public sector. It addresses the limited funding resources for local infrastructure or development
13
Page 35 of 36
projects of the public sector thereby allowing the allocation of public funds for other local priorities.
It is a mechanism to distribute project risks to both public and private sector. PPP is geared for both
sectors to gain improved efficiency and project implementation processes in delivering services to
the public. Most importantly, PPP emphasizes Value for Money – focusing on reduced costs, better
risk allocation, faster implementation, improved services, and possible generation of additional
revenue. It is settled that PPPs encourage the injection of private sector capital. Nevertheless, it
addresses our common concerns over the National budget and Official Development Assistance
(ODA) that are limited and are subject to government prioritization. Private sector funding, on the
other hand, is readily available. It may be tapped to augment ODA funds and the government
budget to implement critical government projects. Indeed, in the case of big-ticket infrastructure
projects, PPPs utilize the financial capital of the private sector. Through it, project construction and
service delivery are accelerated. It is presumed that PPPs make projects affordable. The
Government spending will be less if the project is undertaken as a PPP, since the private sector
funds their share of the project (including operation and maintenance) during the duration of the
concession. PPP projects consider the whole of life costing approach (whole life cycle costing)
which ultimately lowers capital and operating costs. Nonetheless, the PPP projects undergo
competitive, transparent bidding. PPP project proponents usually provide the most cost-effective
capital goods necessary for the project. Clearly, the PPPs deliver value for money. The Value for
Money is achieved when the government obtains the maximum benefit from the goods and
services it both acquires and provides. It is the best available outcome after considering all the
benefits, costs, and risks over the entire project life, which may not necessarily be the lowest cost
or price. It is established that in PPPs, each risk is allocated to the party who can best manage or
absorb it. The PPPs enable the government to take on fewer risks due to shared risk allocation.
Generally, the private sector takes on the project’s life cycle cost risk, while the government
assumes site risks, legislative and government policy risks, among others. Meanwhile, the PPPs
force the public sector to focus on outputs and benefits from the start. The Project preparation
activities are more rigorous in public-private partnerships. This ensures that the project is highly
bankable and can stand public scrutiny. Better project preparation and execution will result in
adherence to project design within the agreed timelines. Further, in PPPs, the quality of service
must be maintained for the entire duration of the cooperation period. The project execution will be
more rigorous as project ownership belongs to the project proponents. The public sector only pays
when services are delivered satisfactorily. Thus, PPPs encourage innovation. The PPPs maximize
the use of private sector skills. It utilizes higher levels of private sector efficiency, specialization,
and technology.
Page 36 of 36