DOF welcomes Senate approval of PPP Act on 2nd reading

The Department of Finance (DOF) welcomes the passage of Senate Bill No. 2233 or the Public-Private Partnership (PPP) Act on second reading on September 20, 2023.

“I thank our good sponsor Senator Joseph Ejercito, as well as Senate President Juan Miguel Zubiri and Senate Majority Leader Joel Villanueva, for working to pass this critical piece of legislation. The Department of Finance, together with the National Economic and Development Authority and the PPP Center, will continue to work with Congress to establish a stable and predictable PPP policy environment to pave the way for high-quality and cost-effective infrastructure in the country,” Finance Secretary Benjamin E. Diokno said.

The PPP Act is a priority measure of President Ferdinand R. Marcos, Jr.’s administration. It supports the 8-Point Socioeconomic Agenda, which prioritizes job creation through the promotion of trade and investments and improving infrastructure.

The proposed measure will consolidate all legal frameworks and create a unified system for investors to refer to when engaging in PPP projects.

To facilitate a more effective and streamlined PPP approval process, the PPP Act will increase the approval threshold for projects that need the National Economic and Development Authority (NEDA) Board’s approval to PHP 15 billion.

Furthermore, it removes the limiting provision of the ‘first-in-time’ approach of unsolicited proposals. This will allow the government to review proposals for the same project simultaneously and choose the best candidate to be awarded the project.

The Act also provides for safeguards such as the creation of a Risk Management Fund for Contingent Liabilities, as well as the mandatory inclusion of dispute avoidance and alternative dispute resolution (ADR) mechanisms for quicker and more efficient rulings.

There is also a penal provision that is applicable to both private individuals or public employees to ensure accountability.

When undertaking PPP projects, the private proponent shares in associated risks for reasonable return on investment while contributing to the effort of nation building. The PPP Act provides investors with Certainty of Tariff Regulation to reduce the investment