Budget Secretary Benjamin Diokno on Tuesday said the Nayong Filipino Foundation Inc. should be held responsible and accountable on the controversial casino theme park project in Parañaque City that was earlier scrapped by President Rodrigo Duterte due to the absence of a public bidding.
According to Rudolf Jurado, former chief of the Office of the Government Corporate Counsel, Diokno, along with Finance Secretary Carlos Dominguez III, “removed the bidding process on [the] Nayong Pilipino contract.”
Jurado, who was sacked by Duterte last May, was blamed by Duterte over the controversy, saying Jurado agreed with a 75-year lease of the Nayong Pilipino property.
“We should not distract ourselves from the main issue here,” Diokno said. “Ultimately, it is the GOCC governing board that has full responsibility and accountability for its decisions,” he said.
The controversy stemmed from the contract review by the OGCC where Jurado cited GCG Memorandum Circular No. 2018-02 as the basis for allowing the Nayong Pilipino Foundation Inc. to lease the land even without public bidding.
Diokno said a review of the facts and law on the matter contradicted Jurado’s position. He said that in fact, an investigation by the Department of Justice has concluded that the NFPI lease contract with Landing Resorts Philippines Development Corp. was void ab initio or has no legal effect from the beginning.
“According to the DOJ report, the contract is a build-operate-transfer contract disguised as a lease contract, the implication of which is that the same should comply with the BOT law, which includes public bidding,” Diokno said.
In the interview, Jurado cited GCG Memorandum Circular 2018-02 which revoked a prior Memorandum Circular No. 2013-03 (Re-Issued), which specifically provides for the public bidding requirement for land bigger than a hectare to be leased for more than 10 years.
Diokno said the revocation of which was misconstrued by Jurado to mean that public bidding is no longer necessary. “On the contrary, it only emphasized the applicability of Executive Order No. 301, s 1987 on the lease of government property for private use, which authorizes the heads of the agency, to determine the reasonableness of the terms of the lease and the rental rates and enter into such lease contracts,” he said.
Diokno said this was reiterated in GCG MC 2018-02, which expressly recognized that though the proposed Major Development Projects and Contracts of GOCCs lie within the sound business judgment of the respective governing boards of the GOCCs, they are still mandated by existing laws, rules, and regulations to exercise extraordinary diligence in the conduct of business and in dealing with the properties of their respective GOCCs.
In fact, the Governing Boards of GOCCs are constituted under Republic Act No. 10149, or the GOCC Governance Act of 2011, as “fiduciaries of the State,” with the “legal obligation and duty to always act in the best interest of the GOCC, with utmost good faith” and who “must exercise extraordinary diligence of a very cautious person with due regard for all the circumstances.”
Moreover, Diokno said GOCCs were required to secure a favorable legal opinion/contract review by the OGCC before entering into the said agreements and not merely rely on GCG MC No. 2018-02.
“As such, there is no such blame to be shifted in this instance; the NFPI Board and OGCC have the last say on the matter,” Diokno said.
Landing Resorts Philippines Development Corp., a local unit of the Hong Kong-based Landing International, was supposed to construct a $1.5-billion casino theme park on Nayong Pilipino’s property in Paranaque City.
Supposedly, the project would feature a casino, resort, water park and office space for NPFI. But President Duterte found the NPFI-Landing Resorts contract of lease anomalous due to the lack of public bidding.
The Chief Executive also said the government would be on the losing end because the lease prices in the deal were much lower compared to the prices for similar properties in the area.
On a groundbreaking day for the said project, Malacanang announced the sacking of Nayong Pilipino officials.
