Nine and a half billion pesos could have fought COVID or aided typhoon survivors
In November 2020, Senator Risa Hontiveros brought before the Philippine Senate a question older than any single government: when public money moves through private hands, who truly bears the burden — and who reaps the reward? At the center of her inquiry was a 9.5-billion-peso loan arranged by the Bases Conversion and Development Authority to build facilities for the 2019 Southeast Asian Games, a deal she alleged was structured to transfer private obligations onto taxpayers while bypassing the transparency safeguards that democratic governance demands. The Commission on Audit had already raised its own doubts, and the Senate was being asked to determine whether national pride in a successful regional games had come at a cost the public never agreed to pay.
- A sitting senator accused a government authority of engineering a 'fake joint venture' that let a Malaysian developer build sports facilities without risking a single peso of its own money.
- The Commission on Audit flagged the deal as prejudicial to public interests, finding that a more transparent procurement mechanism had been deliberately sidestepped.
- With the country simultaneously battling COVID-19 and recovering from a devastating typhoon, the P9.5-billion figure carried a moral weight far beyond accounting — it represented choices not made for lives in crisis.
- The BCDA defended the arrangement as legally sound and timeline-driven, insisting the compressed 2019 hosting schedule left no room for slower, more conventional procurement processes.
- The Senate investigation now stands as the arena where institutional confidence meets public accountability — and where the true cost of the 2019 SEA Games may finally be reckoned.
On a Tuesday in November 2020, Senator Risa Hontiveros rose in the Senate chamber to make a pointed accusation: the Philippine government had been maneuvered into funding a sports project that should never have cost taxpayers anything. Her focus was a 9.5-billion-peso loan extended by the Bases Conversion and Development Authority to construct facilities for the 2019 Southeast Asian Games in New Clark City, Tarlac.
The arrangement had a deceptively clean surface. In February 2018, the BCDA signed a joint venture with Malaysian developer MTD Capital Berhad, under which MTD was to advance 8.5 billion pesos for construction while the BCDA contributed land. But Hontiveros alleged that MTD never actually provided the capital. Within a month of signing, the Development Bank of the Philippines approved a 9.5-billion-peso loan that effectively became MTD's contribution — without the company assuming any financial risk. The BCDA later repaid the entire debt using public funds.
What sharpened Hontiveros's concern was not just the money, but the method. She called it a 'fake joint venture' — a structure that allowed the BCDA to bypass the rigorous public bidding requirements that a project of this scale would normally require. The Commission on Audit agreed the deal was troubling, concluding it was prejudicial to government interests and that a Build-Transfer mechanism would have been the legally appropriate and more transparent path.
The senator also named the opportunity cost plainly: nine and a half billion pesos that could have funded pandemic response or aided communities devastated by Typhoon Rolly. The abstraction of government finance, she insisted, had real human consequences.
The BCDA defended itself on grounds of necessity. When the Philippines moved its SEA Games hosting from 2023 to 2019, the authority faced a drastically compressed timeline. The joint venture with MTD, it argued, was the only viable path to meeting international certification standards on schedule. Officials also maintained that MTD had not received undue advantage, and that the project cost had been significantly reduced through negotiation.
Nonetheless, the Commission on Audit's findings suggested the legal framework had been stretched to fit the arrangement. As the Senate prepared its investigation, the 2019 SEA Games — widely celebrated as a national achievement — had become an uncomfortable case study in how public funds can move through structures that obscure both their true cost and their ultimate beneficiary.
Senator Risa Hontiveros stood before the chamber on a Tuesday in November 2020 with a straightforward accusation: the government had been duped into funding a sports project that should never have cost the public a peso. The target of her scrutiny was a 9.5-billion-peso loan that the Bases Conversion and Development Authority had extended to build facilities for the 2019 Southeast Asian Games in New Clark City, Tarlac. The money, she argued, had been funneled through a deliberately constructed arrangement designed to shift private obligations onto taxpayers.
The structure was simple enough on paper. In February 2018, the BCDA signed a joint venture agreement with MTD Capital Berhad, a Malaysian developer. Under the terms, MTD was supposed to advance 8.5 billion pesos to construct the sports facilities while the BCDA contributed the land. But Hontiveros alleged that MTD never actually provided the capital. Instead, a month after the agreement was signed, the government-owned Development Bank of the Philippines approved a 9.5-billion-peso loan—money that effectively became MTD's contribution without the company risking a single peso of its own. The BCDA then paid back the entire debt using taxpayer funds after the Games concluded.
What troubled Hontiveros most was not merely the financial sleight of hand, but what it revealed about how the government had chosen to operate. The arrangement, she said, was a "fake joint venture"—a structure that allowed the BCDA to bypass the more rigorous public bidding requirements that would normally apply to a project of this scale. The Commission on Audit had already flagged the deal as questionable, noting that it was "prejudicial to the interests of the government" precisely because it circumvented the transparency and competitive scrutiny that public procurement rules were designed to ensure.
Hontiveros did not mince words about what the money could have done instead. Nine and a half billion pesos, she noted, could have been deployed to fight the COVID-19 pandemic that was ravaging the country at the time of her speech, or directed toward relief efforts for Bicolanos devastated by Typhoon Rolly. The opportunity cost was not abstract—it was measured in lives and livelihoods foregone.
The BCDA's defense was that the arrangement had been necessary. The original plan, approved by the National Economic and Development Authority, had called for the Philippine Sports City to be developed in 2021 for a 2023 SEA Games hosting. But when the Philippines moved up its hosting to 2019, the BCDA faced a compressed timeline. The joint venture with MTD, the authority argued, was the only way to meet the accelerated schedule while ensuring the facilities would pass international certification standards. The BCDA also maintained that MTD had received no undue advantage—only the ordinary benefit of time and preparation that came with being the proponent of an unsolicited proposal. The company's proposal, they noted, had undergone negotiation and a competitive challenge process, and the final project cost had been dramatically reduced from the initial proposal.
But the Commission on Audit's findings suggested the legal framework had been bent to accommodate the arrangement. A Build-Transfer structure, the audit body had concluded, would have been the appropriate mechanism—one that would have subjected the project to stricter oversight and more transparent procurement rules. Instead, the joint venture agreement had allowed the BCDA to function as both developer and funder, with the Malaysian firm essentially receiving a government-backed loan to fulfill its contractual obligations.
Hontiveros called for a full Senate investigation. The public, she said, deserved answers about whether the transactions had violated existing laws and policies. The BCDA had acted with the guidance of the Asian Development Bank and believed the joint venture was the best-suited approach, but that institutional confidence did not settle the question of whether the public interest had been served. As the Senate prepared to examine the matter, the 2019 SEA Games—celebrated as a triumph of national organization and pride—had become a case study in how government funds could be channeled through legal structures that obscured their true cost and beneficiary.
Citações Notáveis
We should not let this pass because the 9.5 billion pesos spent could have been used in our fight against COVID or as aid for those affected by Typhoon Rolly— Senator Risa Hontiveros
The public deserves answers to the many questions surrounding this project— Senator Risa Hontiveros
A Conversa do Hearth Outra perspectiva sobre a história
Why would the BCDA agree to fund a loan that MTD was supposed to provide? That seems like they were setting themselves up to lose.
Because the timeline was impossible otherwise. The Games were moved up to 2019, and there was no time for a traditional bidding process. The BCDA needed a partner who could move fast, and MTD offered that. But the way they structured it—with the government bank providing the capital—meant MTD had no skin in the game.
So MTD got the contract and the government paid for it?
Exactly. MTD was supposed to advance the money as part of the joint venture. Instead, the DBP loaned the money, MTD used it, and then the BCDA paid back the loan. MTD built the facilities but never risked its own capital.
Did the BCDA know this was problematic?
They say they followed all the rules and had expert guidance. But the Commission on Audit flagged it as questionable. The real issue is that a joint venture bypassed the public bidding requirements that would normally apply. That's where the transparency broke down.
Could they have done it differently?
Yes. A Build-Transfer arrangement would have subjected it to stricter oversight. But that would have taken longer, and the Games were coming fast. So they chose the faster path, even if it was less transparent.
And now the money is gone?
The BCDA paid back the 9.5 billion pesos last year. The facilities were built and used. But the question remains: was this the best use of public funds, or was the structure designed to benefit MTD at the public's expense?