Closer To Solving Classroom Shortage

MANILA, Philippines - The Department of Education (DepEd) is "one step closer" to solving the classroom shortage in public schools after Thursday's opening of financial proposals for its Public Private Partnership for School Infrastructure Project (PSIP) revealed successful bids.

"Many are called but few are chosen," said Education Secretary Armin Luistro while congratulating the bidders.

Luistro said that what was once unimaginable - closing classroom shortage - is finally within DepEd's reach.

"Now we can say that it is possible because we worked together and we did this for over 20 million young people, to provide them access to quality education," he said.

After close review and evaluation, the Prequalification, Bids and Award Committee and its Technical Working Group found that the two technical proposals, including the mock up structures constructed in Malolos City, Bulacan, are compliant with the PSIP's Minimum Performance Standards and Specifications.

"We have always been at the fore of groundbreaking this (PPP) process, now we can truly push for real public-private partnership - an engagement that goes beyond a purely business venture but one that engages the rest of the nation in planting seeds of hope," Luistro said.

The DepEd expects to issue the Notice of Award to the two bidders within the next four weeks.

The PSIP is a build-lease transfer contract for the design, construction and maintenance of 9,301 classrooms (with toilets and furniture) in Regions I, III and IV-A for a period of 10 years.

The submitted bid prices were lower than the total Approved Budget for the Contract (ABC) of PhP16.4 billion. For Region I, BF Corporation - Riverbanks Development Corporation was the lowest complying bidder for 2,157 number of classroom packages at P344,590,312.00 for annual lease payment.

For Region III, Citicore Investment Holdings, Inc. -Megawide Construction Corporation, Inc. was the lowest bidder for 2,885 classroom packages at P 522,989,913.60.

For IV-A, Citicore Investment Holdings, Inc. -Megawide Construction Corporation, Inc. also submitted the lowest bid of P760,490,438.40 for 4,259 classroom packages.

The ABC for the PSIP was derived using the DepEd's cost for single and two-storey classroom construction, considering efficiencies brought about by the use of new technologies in construction and by economies of scale. This translates to a cost of P620,812 per single storey classroom, inclusive of toilets and furniture; and a cost of PhP1,062,890 for a two-storey classroom, inclusive of toilets and furniture.

"Of the required 9,301 classrooms, 69 percent are two-storey buildings, while 31 percent are single-storey buildings," Luistro said.

Since the PSIP is a lease project, other costs are factored in such as maintenance, financing costs and taxes. The inclusion of periodic maintenance every 4.5 years ensures the durability of the structures and helps extend their design life. The financing costs, on the other hand, represent the cost of using private sector money to construct the classrooms today and pay it back over a period of 10 years. Meanwhile, although tax payments are factored in the cost, these ultimately revert back to government as part of internal revenues.

Of the six pre-qualified bidders, BF Corporation-Riverbanks Development Corporation and Citicore Investment Holdings-Megawide Construction Corporation submitted technical and financial proposals for the Project. The technical submissions of these two bidders were opened last July 18, 2012.

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