Monday, January 3, 2011

Continuation of "U.P.'s Unfinished Infrastructure Projects are in Danger of Becoming White Elephants Due to Aquino Administration Budget Cuts"

(The proposed Department of Mining, Metallurgical & 
Materials Engineering Building, U.P. Diliman.
To enlarge the picture, just click on it)

According to the Department of Budget and Management, P 275 million was allocated in 2010 for the Engineering Research and Development for Technology Projects which includes the proposed Department of Mining, Metallurgical & Materials Engineering Building at U.P. Diliman. This was a project of former President Gloria Macapagal-Arroyo through the Engineering Research and Development for Technology (ERDT) Program.

(National Institute of Physics Building
Phase-B, U.P. Diliman)

(The back view of the proposed National 
Institute of  Physics Building)

Then there is U.P. Diliman's uncompleted National Science Complex as well. According to the College of Science website ( the College of Science is "in dire need of additional funding support to properly maintain and operate the National Science Complex (NSC) that is scheduled for completion in 2011. The NSC is built to provide a nurturing and enabling environment to Filipino scientists, researchers and students allowing them to generate new knowledge and to offer cutting-edge technical support and accurate scientific advice to the Philippine government and the private sector especially the small and medium scale enterprises."

"Today, the College is composed of eleven constituent units including five national institutes and seven CHED Centers of Excellence. Four of the national institutes were established in the 1980’s (MSI, NIGS, NIP, NSRI) while the fifth (NIMBB) was created in the 1990’s. The yearly MOOE budget allocations that are used to fund R&D activities in the national institutes have not been increased since the institutes were first founded if only to neutralize the debilitating effects of inflation and to support the needs of an increasing number of PhD faculty members that are being employed in CS units," the website said.

(The uncompleted National Institute of Molecular
Biology and Biotechnology building)

The National Institute of Molecular Biology and Biotechnology building is expected to be completed by June of 2011. The three-storey structure will house several laboratories as well as lecture and seminar rooms for the faculty and students of the NIMBB, according to the website, UPdate Diliman online (

The first floor will contain the administrative offices, lecture and seminar rooms, an e-library and a conference room. The second floor will house teaching labs as well as culture rooms for materials used in its research. It has a wet area as well as an animal cell and plant cell culture room, the website said.

The third floor will have more laboratories, some with airlocks to prevent contamination. There is also a freezer bay as well as storage rooms for the more sensitive materials like radioactive isotopes, the website added.

(Institute of Chemistry Phase 2 at U.P. Diliman 
will be completed by January 2011)

In the case of the Institute of Chemistry, "the implementation of Phase 1 of the construction of the research building and part of the teaching building of IC has been underway since last May 2008. Construction of the research building is expected to be finished by December 2009. Phase 2 of the project for the completion of the construction of the teaching building starts January 2010 and ends January 2011," said a statement at the Institute of Chemistry sublink at the College of Science website at:

"The Project Team led by IC and Architect Lisa Santos ensures that buildings construction are completed on schedule and within budget by holding weekly site coordination meetings with the building construction management and contractor and representatives of the UP Office of the Campus Architect," the website said.

But hand-in-hand with the various projects in the National Engineering  Complex and the National Science Complex are the mindsets of several ranking Aquino administration officials who seem to think that U.P. can hit the ground running in terms of operating these massive projects without corresponding increases in Mainetance and Other Operating expenses (MOOE) from the National Government.

For example, Budget Secretary Florencio Abad proposed massive cuts in the budget of UP and other state universities and colleges (SUCs) for 2011. From P6.9 billion in 2010, Abad decreased UP’s budget to P5.5 billion, or a difference of P1.4 billion. Other SUCs were also faced with budget cuts. Abad wants them to have a budget of P21.7 billion, down by some P700 million from their budget of P22.4 billion in 2010.

Administration officials say that since U.P. had extraordinary expenses in 2010 relating to capital outlay expenditures such as the National Engineering Complex and the National Science Complex construction in several phases, and that it also had savings of P 11.9 billion in 2010; then there was no need to increase the budget of U.P. for 2011.

An interview by Senate staff with Senator Franklin Drilon  the chair of the Senate Finance Committee over the budget of SUCs, reveals the blind eye with which Administration officials have turned to SUCs such as U.P.  who are expected to generate their own revenue to operationalize massive infrastructure projects approved of by the previous administration:

"Q: Zero po yung capital outlay?

DRILON: Yung capital outlay, ibig sabihin nagawa nay un. Yung capital outlay para sa mga sabihin nating building. Eh kung nagawa na yung building bakit natin ilagay muli? Assuming na naglagay ng P5 million sa building at yan po ay nagawa na, eh bakit mo ibabalik?

Q: Yung MOOE may cut din?

DRILON: Di babawasan ang MOOE mula sa current year. Ang dagdag, kapag kailangan pa nila ng mga salapi, yan po ay merong mga internally generated funds naman sila." (

Following Drilon's logic that U.P. must generate its own resources for any shortfalls in additional rquirements for MOOE; the last approved land use plan for U.P. Diliman is dated 1994, and it stipulates that 88 hectares or 17.8% of U.P. Diliman's 493 hectares are allotted for commercial development, according to the website of the Office of the Campus Architect of U.P. Diliman.

Assuming for the sake of discussion that U.P. is able to lease out properties at commercially competitive rates of P 200/square meter per month, then it is in fact possible to generate revenues of P 2 billion a year. However, the problem with this is that U.P. Diliman will not be able to immediately "monetize" its land assets as first of all, U.P. Diliman's land use plan needs to be updated to cope with the changes in the times. Secondly, U.P.'s bureaucratic processes, Commission on Audit oversight and the need to consult sectors in the vigilant U.P. Diliman community virtually guarantee that commecialization of U.P. Diliman properties will have to pass through the proverbial eye of the needle. Lastly, the incoming U.P. President Alfredo E. Pascual, who assumes office barely a month from now, or on February 10, 2011 will have to do a balancing act where revenues geenrated by U.P. Diliman will have to also be shared across the U.P. System which also have their own pressing financial concerns.

Mr. Pascual therefore will have to expend a lot of effort in adopting a dual track formula of pressing the national government for more funds starting the first half of 2011 when the annual budget cycle commences anew with government agencies lobbying the Department of Budget and Management to consider inclusions of their various concerns before DBM wraps this up for submission by the President to Congress in the second half of the year. Mr. Pascual will also be simultaneously preparing for the worst case scenario which will be for U.P. to independently raise funds in view of a looming funding shortfall for U.P. programs and projects, including the National Engineering and National Science Complexes.

In this respect, we wish Mr. Pascual all the very best as he seeks to solve the gigantic conundrum left by his predecessor, the outgoing U.P. President Emerlinda R. Roman, who leaves behind a legacy of  many unfinished works with correspondingly uncertain fates. Mr. Pascual must press the Aquino administration and President Benigno S. Aquino III's allies in Congress for an increase in U.P.'s budget in 2012 since U.P. is tasked to do so much in engineering, the sciences and in other fields. For all these, state resources must be expended if the country is to remain competitive with its rivals in the region.

(A sign calling for budget increases for U.P.
hanging outside the College of Home Economics, U.P. Diliman)

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(Photos by Chanda Shahani)

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