Balance in dissimilar interests

Shortly after the government transferred the management of the Ninoy Aquino International Airport to the New Naia Infrastructure Corp. (NNIC), the latter quadrupled the parking fees for motor vehicles in the airport’s parking areas.

It said the adjustment was necessary to ensure the continued maintenance and improvement of the facility and to discourage its use by motorists who have no business with the airport but park there due to its low parking fees.

That action drew a strong protest from motorists who frequently use the parking areas for being oppressive and unconscionable.

A month later, the operator of North Luzon Expressway raised the toll rate for the connector road that links a street in Caloocan City to Manila in line with its management program.

Like similar increases in toll rates in the past, that move did not sit well with affected motorists.

Note that the increase in airport parking fees was part of the concession agreement that NNIC entered into with the government, while that of the expressway had been approved by the Toll Regulatory Board.

In other words, they had the blessings of the government and it is fair to assume that its approval was done after careful consideration of the attending circumstances.

The adverse reaction by some sectors to those actions does not come as a surprise. It happens every time a facility operated by a private company for the public’s benefit or use makes an upward adjustment of its fees or charges.

The additional revenues sought to be raised from that action is meant to ensure the efficient operation of the facility pursuant to its agreement with the government and, like any regular business transaction, to give the stockholders of the company a fair return on their investment.

It assumes more significance if the company had incurred loans from foreign or domestic financial institutions to fund the construction and operation of the facility, and has to maintain certain financial ratios as part of the financing agreement.

In an ideal world, facilities that the public use in common should be free of charge or, at worst, should impose minimal fees for their use. The taxes the government imposes and collects from the taxpayers are supposed to fund the construction and maintenance of those structures.

Indeed, why should taxpayers pay something extra for the use of facilities that the government is, in the first place, obliged to put up and operate for them?

Good question, but the reality on the ground is that government often does not have sufficient resources for that purpose and is therefore sometimes forced to seek assistance from the business sector to fill up its inadequacy in some areas of governance.

More so if borrowing money from external sources for that purpose could have adverse consequences on the country’s financial health.

When the government does that, its objective is to promote the public welfare or interest. On the part of the business sector, entering into that arrangement is primarily to earn profits, plain and simple. And there is nothing wrong with that because it’s an integral part of our system of government.

Unless the government is able to come up with a scheme to compensate from its own resources the services rendered, the users of privately funded facilities would have to shoulder the costs of their operation and maintain by way of fees and charges.

Anyone who refuses or is averse to making those payments can simply avoid them and avail of other facilities. In effect, the financial burden is imposed on those who directly benefit from the use of the facility and not on the public in general.

While it may be true that some public-private partnerships agreements may not have fully met their objectives, that arrangement remains the most effective and viable means by which the government can strike a balance between public and private interests in projects intended for public use.

Besides, they are better off being run by the private sector because government has a spotty record when it comes running a business.

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