Reduced red tape saves telco, logistics P2.4 B

Published October 19, 2020, 5:00 AM

by Bernie Cahiles-Magkilat

The mandatory streamlining of the processes for the telco towers and logistics sectors in the country would result in substantial savings of more than P2.4 billion, according to Anti Red Tape Authority (ARTA) Director General Jeremiah Belgica.


In a presentation before the Philippine Chamber of Commerce and Industry (PCCI) Mindanao, Belgica said the reduced red tape in these two sectors was computed based on the standard cost model calculation of the World Bank. The streamlined process was a result of the implementation of the National Effort for the Harmonization of Efficient Measures of Inter-related Agencies (NEHEMIAH) Program. The sectoral-based streamlining effort targets to reduce the time, cost, requirements, and procedures in sectors of economic and social significance by 52 percent within 52 weeks.

Program NEHEMIA is pursuant to Rule III Section 3 of the Implementing Rules and Regulations of Republic Act 11032 which mandates ARTA to adopt a whole-of-government approach in the streamlining of government services.

According to Belgica, Pre-NEHEMIAH, both sectors have combined expenditures of P3.254 billion as against P830.626 million only after NEHEMIAH.   

Belgica said the staggering expenses represent tariff for companies and professionals, middlemen, and opportunity cost in the sector.

Broken down, the logistics sector alone would spend P378.833 million only after the  implementation of the reform under the NEHEMIAH Program as against the staggering P2.229 billion cost before the reform. This would translate in total sectoral savings of P1.92 billion.

With ARTA’s issuance of the mandatory compliance order, the logistics sector would have streamlined their procedural steps by 88 percent and time spend for processing cut by 87 percent.

For the telco towers, Belgica said the sector would spend only P451.792 million or less than half of the P1.025 billion expenses that represent the cost of licensing for 10,000 towers before the streamlining of the sector’s processes.

The reduced cost would translate in P573.963 million sectoral savings. As a result, Belgica said there will be additional 5,000 towers by end this year although the country needs 50,000 telco towers to be competitive.

LGU permitting was also reduced by 38 percent, the documentary requirements by 59 percent and time spent to process was cut by 93 percent.   

These two sectors were forced to streamline their processes and fast tracked the issuance of permits and licenses following the compliance orders issued by ARTA to local government units (LGUs) with pending applications from telco companies and the adoption of single pass for the logistics players.

“Implementation is gaining momentum,” said Belgica.

Belgica stressed that gone are the days for the quota system, sitting on documents and making people wait while government employees are on noon break. 

Government agencies are given 3-7-20 days to approve or disapprove a complete application.

Belgica also noted the various cases they have filed at the ombudsman against government agency officials and LGU officials for their failure to comply.

Violations under the law include administrative liability and suspension, but outright dismissal and charges for officials involved with fixing and or collusion with fixers.

The mission is daunting given the more than 10,000 government agencies both national and local plus 42,000 barangays, but Belgica said “If we streamline, we won’t give opportunity for

corruption to happen.”

As the processes have been streamlined, the government is now launching the automation of all government applications under the Central Business Portal.

“So yes, it is true that coming from a standstill position but it is really gaining momentum,” he added.

He cited the case of the Food and Drug Administration which was forced to comply with the ARTA order to approve the pending thousands of renewal applications, which were supposed to be approved automatically.

“FDA is a challenged agency when it comes to red tape. If FDA could reform then all agencies could do it. Penalties are very steep,” he warned.