Rising connector road cost weighs on gov’t

A North Luzon toll road operated by a Metro Pacific Investment Corp. firm. The price tag of a proposed elevated roadwork of MPIC has just gone up due to higher costs in acquiring right-of-way access, forcing the government to double its project subsidy, data from the National Economic and Development Authority has revealed. PHOTO FROM MPIC.COM.PH

The price tag of the elevated roadwork of Metro Pacific Investment Corp. has just gone up due to higher costs in acquiring right-of-way access, forcing the government to double its project subsidy, data from the National Economic and Development Authority (Neda) revealed.

According to information presented by the Department of Public Works and Highways to the economic planning agency, the government subsidy that would be required for MPIC’s unsolicited connector road project has gone up to P4.76 billion from P2.4 billion.

Because of the rise in the required subsidy for the project, it will now take P25.56 billion to complete the road work. The figure is 27 percent higher than the original cost of P20.2 billion, the data revealed.

Accounting for 19 percent of the total project cost, the road right of way (RROW) expense is the second-biggest component of the connector road project after construction cost.

Earlier this year, President Aquino gave the green light for the construction of two elevated toll highways that would connect the South Luzon Expressway (SLEx) to the North Luzon Expressway (NLEx).

The connected road project is an unsolicited proposal from MPIC.

Apart from the hike in government subsidies, the data from the Neda also revealed a 23-percent increase in the connector road’s construction cost from P15.4 billion to P18.9 billion.

Construction costs went up because the project had to be redesigned to accommodate the Airport Express Rail (AER) of the Department of Transportation and Communications.

Fixed operation equipment costs also rose by 59 percent, from P308 million to P489 million, while engineering costs slightly declined from P1.2 billion to P1.1 billion.

The allocation for contingency expenses, meanwhile, went down by 66 percent from P787 million to P269 million.

The NLEx-SLEx connector road—which starts at Buendia in Makati City and ends on 5th Avenue in Quezon City—does not include the planned Segments 9 and 10, which are needed to complete the link between 5th Avenue and Mindanao Avenue (in Quezon City), before connecting with NLEx.