By Ben Rosario
Congressmen today demanded the renegotiation of the P38.5 billion agreement for the production and supply to the Department of Foreign Affairs of E-passports that has been deemed grossly disadvantageous to the government and fraught with security concerns.
At the initial hearing of a joint congressional inquiry into the troubled passporting process, lawmakers noted that the joint venture agreement between the state-run APO Production Unit Inc. and the private firm United Graphic Expression Corp. has earned the latter at least P630 million in profits annually for the last five years , given an investment by UGEC of only P193 million.
“This deal has been losing money for the government. UGEC) has enjoyed good business, captured the market that has been growing annually with the sharing that is is not advantageous to the government,” said Baguio City Rep. Mark Go.
Party list Reps. John Bertiz (ACTS-OFW); Rodel Batocabe (Ako Bicol) and Anthony Bravo (Coop-Nattco) noted that APO has totally ignored security concerns in allowing a private firm to supply the security paper and to virtually take over the whole operations of supplying government the E-passports.
The House Committees on Good Government and Accountability and on Foreign Affairs have launched a congressional inquiry into the passporting mess following the filing by Bayan Muna Rep. Carlos Zarate of a resolution raising alarm over the huge backlog in the issuance of passports.
Invited as guest during the hearing, Foreign Affairs Secretary Alan Peter Cayetano admitted that there is indeed a “wide gap between the demand for passports and DFA’s capacity” to process applications.
However, the deficiencies have already been addressed as demand for new and renewed passports continued to grow each year.
According to Cayetano, the rise in passport applicants and the operation of groups preying on applicants through bogus appointments for passporting have already been addressed while new consular offices are being set up to help clear the backlog.
Cayetano also assured the lawmakers that security concerns on the passport plant in Lima, Batangas have not been overlooked.
However, former Foreign Affairs Secretary Perfecto Yasay assailed the APO-UGEC deal as a violation of various laws and government rules, noting that it has grossly defied provisions for a public bidding under Republic Act 9184.
“In the new contract, UGEC cannot be held accountable for breach of contract, including unauthorized acquisition and control of passport data,” Yasay testified.
Yasay revealed that he has recommended the voiding of the JVA but this move might only worsen the problem because no other government agency, particularly the Bangko Sentral ng Pilipinas, is capable of producing passports should APO and UGEC abandon their passport printing obligations.
He said a renegotiation of the JVA that would do away with the lopsided provisions that protect UGEC’s huge profit and other responsibilities as government partner in providing public services.
Among the more contentious issues raised is UGEC’s control of the security paper for the production of passports.
Zarate said supply of security paper did not undergo public bidding as required by RA 9184.
Lawyer Aileen Saguir, who represented UGEC, insisted that as a private company, the firm is not bound by RA 9184.
Zarate retorted that this is precisely what makes the JVA unacceptable, adding that it is designed to skirt the provisions of RA 9184.