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 on: October 22, 2013, 12:08:47 PM 
Started by Forum Admin - Last post by Forum Admin
Below are the profiles of the candidates for the SBFCC's 2013-2014 Board of Directors election (arranged by submission date of profile).

2014 SBFCC Board of Directors Candidates
 Rose Baldeo    Global Terminals (Golden Eagle Member)  download (110.6kB)
 Lawrence Lusung  Bank of Commerce  download (18.9kB)
 Danny Piano  Absolute Service Inc (Emerald Tier Member)  download (105.4kB)
 Shiny Kim  Golden Dragon Resort and Casino  download (80.3kB)
 Peter Tumanda  Reyes, Diano, Tumanda & Co.  download (53.4kB)
 Lewis Strickland  PACTEC Subic Bay  
 Dante Pollescas  Subic Enerzone (Silver Circle Member)  

Click here for information about the SBFCC Election.


 on: October 18, 2013, 11:32:35 AM 
Started by Forum Admin - Last post by Forum Admin
From BusinessWorld:

INVESTMENT in the Philippines is expected to grow over the medium term, with more opportunities opening for the private sector as the economy continues to expand.
  “The Philippines is a rising star in the investment universe,” Deputy Treasurer Sharon P. Almanza said in a keynote speech at an investment forum yesterday.

“The pressure is upon us to deliver... but we need the investor community to continue to fuel our rising star,” added Ms. Almanza, who delivered the speech in behalf of National Treasurer Rosalia V. de Leon.

With the economy continuously growing above trend, she said this would provide the country “positive momentum for takeoff.”

First semester growth was 7.6%, above the 6-7% target, and many analysts have recently upgraded their forecasts for the Philippines.

Macroeconomic fundamentals -- boosted by the appropriate fiscal and monetary policies -- are also providing ample buffers amid uncertainty in the global environment, Ms. Almanza noted.

“More positive news will continue to bolster our case to investors... and with the country gaining investment grade status from the three major credit raters, this will provide more lift for the economy,” she said.

The view was shared by Luz L. Lorenzo, senior vice-president of Maybank ATR Kim Eng, who said the outlook remained positive.

“With the uncertainty in the markets, the best defense is a strong economy. And with the Philippines continuing to be driven by domestic demand, with its young population driving strong consumption, investments can only contribute more and more to growth,” Ms. Lorenzo said.

Maria Theresa Marcial-Javier, senior vice-president at the Bank of the Philippine Islands, said the country should move to capitalize on its gains.

“With the economy’s growth increasingly becoming more domestically led, opportunities abound for the consumer, retail, and property sectors,” Ms. Marcial-Javier said.

“The environment now provides the government and private sector alike opportunities for expansion and growth ... But sustained growth will need to be coupled with an increase in income to ensure growth trickles down to all sectors,” she added.

Gerald D. Baldivia, managing director at Angeon Advisers, Ltd., added that opportunities for improvement also included the education, health and tourism sectors.

“This will support the production and buildup of physical and human capital that will give the economy a broader support base moving forward,” he said.

“The Philippines used to have a very challenging investment environment, and that’s changing now. We expect all these to translate into more investments in the future.”

Moving forward, officials and regulators pledged additional reforms to support growth.

Hans B. Sicat, president and chief executive of the Philippine Stock Exchange, Inc., said good corporate governance was critical to maintain a favorable perception among investors.

“Improved macroeconomic conditions translated into this confidence, and this will go down to individual companies to help them fuel the economy, moving the country into a positive growth cycle,” Mr. Sicat said.

The government, said Ms. Almanza, “will always remain to be one step ahead, maintaining a steady hand on policy levers and building on past achievements ... to foster the type of environment viable for investments.”


 on: October 18, 2013, 11:30:46 AM 
Started by Forum Admin - Last post by Forum Admin
From SubicNewsLink:

The world’s only five-star cruise ship is here in the Subic Bay Freeport as part of its tour of the country, strengthening Subic’s position as a preeminent tourism destination.

MS Hanseatic docked at the Alava Pier of the Freeport Monday (Oct. 14). Prior to its arrival here, the cruise ship toured the Hundred Islands in Pangasinan. It arrived in the Philippines yesterday (October 13).

According to the Berlitz Complete Guide to Cruising and Cruise Ships, it is the only five-star expedition-cruise ship worldwide.

Subic Bay Metropolitan Authority (SBMA) Chairman Roberto Garcia said this is first time that the luxury cruise ship has docked in Subic.

He said passengers of the ship are scheduled to visit tourist attractions in the Freeport during the ship’s one-day stay.

The ship has a capacity of 184 passengers, aside from its crew of 125.

MS Hanseatic was built in 1991 as the Society Adventurer, but was renamed when she was purchased by Hanseatic Tours, now owned by marine transportation giant Hapag-Lloyd. The ship specializes in trips to the Antarctic.

SBMA deputy administrator for business Reuel Kabigting said the arrival of the Hanseatic is a very welcome development, as it would boost the Freeport’s thrust of becoming a premier tourist destination in Asia.

The SBMA has been preparing the Freeport to be a top cruise-ship destination after it became a founding member of the Asia CruiseTerminal Association, Kabigting added. (FMD. RAV/MPD-SBMA)

Members of a school band presents passengers with leis upon disembarking from the MS Hanseatic cruise ship at the Subic Bay Freeport on Monday.


 on: September 25, 2013, 06:11:56 PM 
Started by Forum Admin - Last post by Forum Admin
The Subic Bay Freeport Chamber provides the opportunity for a significant degree of active participation in the development of the Freeport.  
The Annual Election of the Board of Directors process starts mid-September. If you are interested in getting value for your investment in the Chamber of Commerce, please consider participation in the Election of Board members.  Choose only those who will do something for the Freeport, for you, and for other investors.
The list of  members in good standing and nominations forms were sent to members last September 9th.  If you have not receive these, please call the Chamber office at 252-3180 or email  There may be last minute amendments made to this list as new Corporate members join prior to closing of elections or if/when Associate members upgrade to Corporate status.
Eligibility and Requirements

Nominees to the Board are required to exemplify and attest to being of sound moral character, demonstrate the highest level of  integrity, and will be expected to conduct themselves with the utmost regard for business ethics at all times. Moreover they are expected to demonstrate initiative, dedication, confidentiality, selfless willingness to serve, and above all, concern for the direction the Freeport and the Chamber will take in the future.
Bear in mind that your elected Board members will be requested to seriously commit to attend Board and General Meetings and mixers every month, to be involved in Committees, and to spearhead membership concerns. All these on a volunteer (without pay, allowance, or honorarium) basis.
Only Corporate members in good standing are eligible for nomination.  Members having past due membership fees will not be permitted to run.  You may nominate yourself, provided you are the authorized representative.

Remember, the Freeport Chamber is YOUR voice  in the community.  Please give careful consideration to nominating the candidate of your choice to serve on the SBFCC Board of Directors.

Election Schedule

September 16 - October 11  - NOMINATION PROCESS BEGINS. Members will receive Nomination Ballots where you can nominate Corporate members of your choice for next year’s Board.

October 14 – October 25 - CANDIDATE SELECTION . Those nominated are asked for their minimum 15 hours per month written, voluntary commitment to serve on the Board. If willing, they will be declared as official candidates in the voting process.

November 4 – November 15 - VOTING PROCESS BEGINS. Based on confirmed candidates who have verified they are willing to serve, ballots are forwarded to all Corporate members who are asked to VOTE for the candidate(s) of their choice.

November 18 – November 22TABULATION. Votes are tabulated by the delegated Returning Officer and scrutinized by the Election Committee.

November 26ANNOUNCEMENT OF RESULTS. Election Results with names of newly elected Board members are announced at the Annual Membership Meeting.

November 26OFFICER SELECTION. Next year’s officers (President, Vice President, Treasurer and Corporate Secretary) are selected by the Board of Directors.
Status of Current Board

While subject to change, there will be four seats to fill during this election.  
    Directors having one more year to serve:  Atty Romeo Duran, Tom de Bruin, and Jun Avecilla
    Running for re-election: Danny Piano, Rose Baldeo, Lawrence Lusung, and Lewis Strickland

 on: September 24, 2013, 05:01:11 PM 
Started by Forum Admin - Last post by Forum Admin
From Businessworld:

A PRIORITY MEASURE rationalizing the country’s statistical system has been signed into law by President Benigno S. C. Aquino III.

Republic Act (RA) 10625 calls for the creation of the Philippine Statistical Authority (PSA), which will assume the functions of the National Statistical Coordination Board (NSCB), National Statistics Office (NSO), Bureau of Agricultural Statistics (BAS) and the Bureau of Labor and Employment Statistics (BLES).

“The newly-signed law aims to promote the orderly development of a statistical system capable of providing timely, accurate and useful data for the government and the public, and support decentralization through the establishment of the statistical infrastructure necessary to service the statistical needs of local development planning,” Malacañang said in a statement.

The Philippine Statistical Act of 2013, signed Sept. 12, was identified as a priority by the Legislative-Executive Development Advisory Council.

The PSA, which will be attached to the National Economic and Development Authority (NEDA), will be responsible for all national censuses and surveys, sectoral statistics, consolidation of selected administrative recording systems and compilation of the national accounts.

It will be constituted from the existing personnel of the NSO, NSCB, BAS and the BLES.

“Personnel of the merged agencies who will not be absorbed into the new staffing pattern due to redundancy or failure to comply with the standards of competence and proficiency, or who will be offered positions under the new staffing pattern but who decline ... shall be given the option to avail” of retirement, the law states.

“The NSO, the BAS of the Department of Agriculture, the BLES of the Department of Labor and Employment and the NSCB shall be abolished and their appropriations, records, properties and personnel shall be transferred to the PSA,” the law states.

“The PSA shall carry out the reorganization of the PSS (Philippine Statistical System) in such a manner that personnel of the agencies absorbed by the PSA shall continue to perform their respective duties and responsibilities in a holdover capacity so as not to unduly delay the production of statistics from ongoing censuses, surveys and processing of administrative records,” it further adds.

Regina N. Reyes, acting NSCB director, said the law’s implementing rules and regulations -- required to be drafted within 90 days -- would provide further directions.

The Bangko Sentral ng Pilipinas’ (BSP) Department of Economic Statistics will continue to take charge of banking and financial statistics, including the balance of payments and fund flows.

The PSA Board will be the highest policy-making body on statistical matters.

It will chaired by the NEDA chief with the Budget secretary or Budget undersecretary as a vice-chairperson. One representative each will come from other government departments, the BSP, the executive director of the Philippine Statistical Research and Training Institute (to be created from the Statistical Research and Training Center), Philippine Statistical Association, government-owned and -controlled corporations, Union of Local Authorities of the Philippines and the private sector.

The PSA head will be appointed by the president from a list drawn up by representatives from the Philippine Statistical Association, University of the Philippines School of Statistics, University of the Philippines-Los Baños Institute of Statistics, the BSP’s Department of Economic Statistics and the NEDA. The national statistician, who will be given a renewable five-year term, should have a master’s degree in statistics.


 on: September 22, 2013, 12:55:00 PM 
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From a report by Robert Gonzaga on Inquirer Central Luzon:

The United States government should compensate the Subic Bay Metropolitan Authority for access to its facilities and not hinder the freeport’s business operations once the US Navy is allowed access to its former naval base, according to a ranking SBMA official.

Although it is possible for the free port and the US Navy to coexist, the US military should abide by the provisions of the Constitution, the Visiting Forces Agreement and Republic Act 7227, or the Bases Conversion and Development Act of 1992, which created the SBMA and the Subic Bay Freeport, said SBMA Chairman Roberto Garcia.


“I believe that we could coexist, but they will have to work within the charter of SBMA, which is to promote this as an investment site. The [US Navy] will be like locators. We can make a [memorandum of agreement] with them, and they pay commercial rates for their stay here,” Garcia said.

Earlier, American Defense Secretary Chuck Hagel allayed fears that the US policy of increasing its political, economic and security engagement with the Asia-Pacific would revive permanent US basing arrangements in the Philippines.

Hagel, who visited the country last month, said he and President Aquino discussed expanding the US military’s presence in the Philippines as the country seeks US support to defend its territories in the West Philippine Sea.

The Philippines and the US are moving closer to concluding a pact that would expand US military presence here.

Defense Secretary Voltaire Gazmin has said that US troops and vessels would gain access not only to Subic but also to other military facilities in the country.

Garcia said while the SBMA defers to the national government because the issue involves national interest, the SBMA cannot subsidize the US Navy’s presence here.


“SBMA will go bankrupt [if we do],” he said.

He said a greater presence of the US Navy would use up areas that could be leased out to other locators, and the traffic of ships in the Subic port would also take a huge toll on its facilities.

Garcia said the US Navy is not paying the SBMA a single centavo for its use of the Subic port, in accordance with the provisions of the VFA.

Asked how a greater presence of the US Navy will affect locators and the future business prospects of this economic zone, Garcia said: “For the ones who can supply [the US Navy], it’s a boon. For those who are not [going to do business with them], as long as their operations are not interfering with the usual [conduct of business], I suppose it would be fine.”

But Garcia made it clear that the US Navy will not have control of the Subic port or call the shots within the economic zone, except in areas designated to them, just like any other locator.

“The US Navy cannot close [parts of] the free port because of their military’s presence, or restrict access,” he said.


 on: September 14, 2013, 04:49:26 PM 
Started by Forum Admin - Last post by Forum Admin
From SubicNewsLink:

Subic EnerZone Corporation (SEZ), a listed corporation in this free port, donated on Wednesday a two-room pre-school facility to the Gordon Heights Elementary School (GHES) in Olongapo City.

The donation was made in line with the corporate social responsibility (CSR) program of SEZ and in corroboration with the Aklat, Gabay, Aruga tungo sa Pag-Angat at Pag-Asa (AGAPP) Foundation, said SEZ senior vice president and chief operating officer Dante Pollescas.

AGAPP has committed to build classrooms and libraries in public elementary schools located in depressed or disadvantaged communities, tapping private companies and other foundations for support as part of their corporate social responsibility.

The third project in Olongapo, the “Silid Pangarap” — as all AGAPP buildings are called — comes packaged with chairs, reading and instructional learning materials, audio-visual equipment, power and water supplies.

“This is purely an undertaking of private corporations committed to build classrooms and libraries in public elementary schools to prepare the children in kindergarten for school life and develop their positive attitude towards schooling,” Pollescas said.

Among these corporations are the National Book Store, which donated books; Uratex for chairs and tables; and EnerZone and Aboitiz for power and water supply lines and the buildings.

GHES principal Fernando de Guzman lauded Subic EnerZone and AGAPP for the initiative, saying that the newly constructed facility would address the shortage of classrooms in the school.

“We wanted to assure the donors that we will take care of the building, so that it can be used for generations. This will benefit not only the children, but the teachers and parents as well,” de Guzman said.

In year 2010, AGAPP and the Department of Education (DepEd), through the Bureau of Elementary Education (BEE), have formalized the partnership and launched the School Libraries cum Preschool Classroom project.

The partnership involves the construction of one-storey buildings furnished as school libraries that will also be utilized as kindergarten classrooms with accompanying age-appropriate instructional materials. It will also support teacher training and school staff development with focus on early childhood care and development and family literary.

Meanwhile, Subic Bay Metropolitan Authority (SBMA) Chairman Roberto Garcia commended EnerZone for its undertakings that spread happiness among school children and teachers in Olongapo City.

“The project, indeed, fits together with the thrust of SBMA to help neighboring communities attain parallel development through projects that help enhance the capacities of residents, ” Garcia said.

Earlier this month, the SBMA through its Public Relations Department, donated school chairs, desks, and whiteboards to the Agusuhin Elementary School Annex in Subic, Zambales. (RAV/MPD-SBMA)


 on: September 14, 2013, 04:46:22 PM 
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From a special report by Stella Arnaldo on the Businessmirror:

TEN tourism destinations have been short-listed as various meeting sites for the Asia-Pacific Economic Cooperation (Apec) forum that will be hosted by the Philippines in 2015.

In an interview, Ma. Victoria Jasmin, undersecretary for Tourism Regulation, Coordination and Resource Generation of the Department of Tourism (DOT), said the 10 “preselected” destinations are the National Capital Region, Tagaytay, Cebu, Clark, Subic, Legazpi, Iloilo, Davao, Bacolod and Boracay.

The DOT is a member of the Apec-National Organizing Council (NOC) set up by President Aquino to oversee the activities and programs that will be held under Apec in 2015 and ensure the successful hosting of the event.

Jasmin told the BusinessMirror “there are several meetings spread throughout the year, and I’m pretty sure that each [destination] will get at least one, barring some fortuitous events.”

The Apec summit which that gathers the heads of state of 21 member-economies, will be preceded by other activities throughout 2015, including the Senior Officials Meeting, the Ministerial and Sectoral Ministerial Meetings, as well as meetings of technical working groups that include the support staff for officials participating in the main Apec events.

Jasmin added there has been “no final decision yet” on where the summit would be held.

Separate government sources also said it was clear that the President “doesn’t want to build a separate facility” just for the Apec meetings.

The Philippines hosted the Apec summit in 1996 at the Subic Bay Freeport. Then-President Fidel V. Ramos built 18 Mediterranean-style villas in the so-called Apec Village, specifically for the use of the heads of state in the summit. The villas reportedly cost $50 million and used for only six hours by the Apec leaders.

But visitor arrivals finally crossed the 2-million mark in 1996, ending the year at 2.05 million, up 16 percent from the 1.76 million posted in 1995, indicating the increased attraction of a country as a tourism destination once a major international summit is held there, government sources noted.

The Philippines is targeting foreign arrivals to reach 10 million by 2016, by the time Mr. Aquino steps down from office.

A team from the NOC has been going around these past few months inspecting the 10 pre-selected Apec sites. Government sources said the inspection teams are checking the hotels in each destination, its MICE (meetings, incentives, conferencing and exhibitions) facilities, the local organizing committee headed by the chief executives of the local government units, etc.

“Specifically, they check the availability of [hotel] suites, the quality and number of rooms, as well as the indicative rates, and renovation or upgrade plans,” one source added.

The Apec-NOC was set up by the President through Administrative Order (AO) 36 issued on November 28, 2012. It is chaired by the executive secretary with the secretary of foreign affairs as co-chairman, and composed of the heads of the regular line agencies.

Among the main functions of the Apec-NOC is to “approve and recommend to the President a master plan for the Philippine hosting of Apec in 2015, including an estimated budget for the proper hosting of the Apec meetings,” according to AO 36.


 on: July 29, 2013, 09:53:59 AM 
Started by Forum Admin - Last post by Forum Admin
From the Philippine Daily Inquirer:

Key strategies and principles:

*  Maximize opportunities for all, especially for those most in need.

*  “We are not content to wait for the trickle-down effect; we cannot leave their fate (receiving the benefits of progress) to chance.”

*  Inclusive growth drives every initiative, action and decision of government. Widespread opportunity is the key to comprehensive and sustained progress (e.g. TESDA scholarship, Pantawid Pamilyang Pilipino Program and quality education)

* “Kayo ang aking lakas (You are my strength).”

Examples of those who contribute to nation-building:

*  Niño Aguirre, and police officers Edlyn Arbo, PO3 Felipe Moncatar and Dondon Sultan, and disaster relief workers and volunteers


*  Scholars of the Technical Education and Skills Development Authority, Department of Labor and Employment: Of the 503,521 people who graduated from their programs, six out of 10 have found jobs; and 70.9 percent of the graduates found employment in Tesda’s Information Technology-Business Processing Operations program, up from 28.5 percent from 2006 to 2008.

Social Welfare:

*  Almost 4 million household-beneficiaries of the conditional cash transfer program

*  Families with children up to 18 years old will be included in the program

*  Calls for reforms in the Social Security Service (SSS) pension scheme to address shortage of funds

*  PhilHealth coverage jumped from 62 percent of Filipinos in 2010 to 81 percent

*  Expanded Z benefit package to cover other conditions and diseases

*  Allotted P33 billion for the modernization of 4,518 hospitals, rural health units and health stations in the country


*  Erased backlogs in chairs, in textbooks, and about to address shortage in classrooms.

Agriculture/fish industry:

*  Agricultural sector grew 3.3 percent, triple that of 2012

*  Rice self-sufficiency on-target. The maximum to be imported would be the minimum access volume of 350,000 metric tons, including the 187,000 metric tons of buffer stock

*  Tap the potentials of coconut industry by intercropping; 434 sites targeted in 2013 for coconut intercropping

*  Cites the cold storage facility in Bataraza, Palawan province

*  Ongoing construction of ports, roads and other infrastructure to benefit the fishing industry

Agrarian reform:

*  The Department of Agrarian Reform has completed the list of beneficiaries of Hacienda Luisita; turnover of lots will start in September.

*  All notices of coverage under the Comprehensive Agrarian Reform Program will have been served by 2014.


Disaster preparedness:

*  Multi-hazard mapping complete for 28 most vulnerable sites; Greater Metro Manila area to be completed in 2014

*  525 automated water-level monitoring stations and rain gauges set up under Project NOAH

*  Cooperating with LGUs to relocate informal settlers

*  Allocation of P6.2 billion to address flooding in Metro Manila (Construction of the Blumentritt Interceptor Catchment area)

*  9,377 houses for “Sendong” victims; 4,374 additional houses underway

*  53,106 houses for “Pablo” victims; 17,609 additional houses underway

*  19,400 families to be relocated from Metro Manila waterways

*  Justice Secretary Leila de Lima to file cases against owners of structures who have closed or obstructed waterways

Benefits of men in uniform

*  21,800 housing projects for policemen completed in 2012; this year’s target of 31,200 houses to be completed next month

*  Calls on the Government Service Insurance System to assist in addressing the pension and benefits problems of police and soldiers

Peace and order situation:

*  Distribution of firearms and weapons to meet the goal of one pistol-to-one police ratio

*  491,929 licenses verified under Oplan Katok

*  Private armies down by 63 percent; election-related violence down to 77 cases

*  Peaceful elections in the Autonomous Region in Muslim Mindanao

*  Accountability for the deaths of Ozamiz Gang members

*  Agreement with the Moro Islamic Liberation Front on the issue of wealth sharing between the Philippine government and a Bangsamoro autonomous entity

*  Reiterated the government’s commitment to uphold agreement.


*  The Department of Science and Technology to assist in purchase of big ticket items

Legislative agenda:

*  Amend Cabotage Law

* Enact Fiscal Incentives Rationalization Bill

* Focus on Land Administration Reform Bill

* Review of PD 1638 and RA 8551 to ensure pensions of PNP and AFP personnel are timely and balanced

* Passage of Bangsamoro Basic Law before end of 2014

* Review of Marcos-issued decrees PD No. 1113 and PD No. 1894

* Review of Civil Service Code and PD No. 1

*  P2.268-trillion national budget


*  Ternate-Nasugbu Road

*  Aluling Bridge in Ilocos Sur

*  Laguindingan Airport

*  Inauguration of the Advanced Device and Materials Testing Laboratory to support the semi-conductor industry

*  Jalaur River Multi-Purpose Project II to benefit 24,000 farmers

*  PPP airports: Laguindingan; Tacloban; Bicol International; New Bohol; Mactan; Puerto Princesa

*  NAIA rehabilitation underway

*  Integrated Transport System Terminals in Parañaque, Muntinlupa, Quezon City

*  NLEx-SLEx Connector Road project

Cabinet men praised:

Secretaries Armin Luistro (Department of Education), Rogelio Singson (Department of Public Works and Highways), Albert del Rosario (Department of Foreign Affairs) and the late Secretary Jesse Robredo (Department of Interior and Local Governments). (Also thanked soon-to-retire Presidential Security Group head, Gen. Ramon Mateo Dizon.)


*  Earned titles such as Best Tourist Destination, Most Romantic Destination, Best Diving Site, Palawan as Best Island in various travel magazines

*  4.3 million tourists in 2012; targets 56.1 million domestic travel in 2016

*  Tourism brought in 3.8 million jobs in 2012

*  Lifting of Philippine Airlines ban from flying to Europe

Turnaround stories of government-owned and -controlled corporations:

*  Local Water Utilities Administration’s P870 million in  net profit in 2012

*  Metropolitan Waterworks and Sewerage System posted P2 billion in profit in 2012 from a P34-million net loss in 2010

Good governance and government savings:

*  P18.4-billion savings by the Department of Public Works and Highways

*  P2.9-billion savings in textbook purchase

Good governance and justice:

*  Former leadership of the Technical Education and Skills Development Authority (TESDA) now being held accountable for overpriced purchases during the term of Augusto Syjuco Jr.

*  Indicted former officials of the Philippine Amusement and Gaming Corp. (Pagcor) who are accused of embezzling P26.7 million to produce a movie and spending P186 million to finance a party-list group

*  Former leaders of the Philippine National Police (PNP) being made to answer allegations regarding P131.6 million wasted on defective rubber boats and P105 million spent on anomalous purchase of secondhand helicopters

Agencies slammed:

*  Bureau of Immigration for the escape of brothers Joel and Mario Reyes (suspects in the murder of broadcaster Gerry Ortega) and Korean fugitive Park Sungjun

*  National Irrigation Administration for their “make-do” culture

*  Bureau of Customs, for permitting smuggling of goods—Compiled by Inquirer Research


 on: July 28, 2013, 12:16:12 PM 
Started by Forum Admin - Last post by Forum Admin
From a report by Robert Gonzaga on the Inquirer:

A confluence of factors, exacerbated by high system losses due to a decrepit power distribution system, corruption and patronage politics, buried Olongapo City’s Public Utilities Department (PUD) in a mountain of debt amounting to P5 billion to power suppliers and threatened to cut the city from the Luzon power grid.

Former Mayor James Gordon Jr. also attributed the crisis to low collection rate due to nonpayment or debts incurred by consumers, widespread energy theft and corruption in the PUD .

The situation worsened because of interests imposed by Private Sector Assets and Liabilities Managaement Corp. (PSALM), the refusal of the Energy Regulatory Commission (ERC) to grant an increase in power rates, and the years of delay in the PUD’s privatization.

Gordon said the debts started piling up during the term of his predecessor and sister-in-law, Kate Gordon, with the city posting P200 million in obligation to National Power Corp.

Even then, the 65-year-old system of the PUD that was inherited from the Americans was showing signs of heavy system losses, along with issues of corruption attached to the agency, he said.

“My predecessors were lucky because when the US naval base was still around, the Americans virtually took care of [the system’s] maintenance. When transformers were needed, these were given to us by the Americans,” he said.

Gordon said Olongapo enjoyed one of the lowest electricity rates in Central Luzon and increasing these to get much-needed revenue did not happen because the ERC refused to allow it without pouring investments into the rehabilitation of the system to make it more efficient.

At least P1 billion had to be spent in modernizing the PUD, money that the city government simply did not have, he said.


As a result, Gordon said that from the start of his three terms as mayor in 2004, the privatization of the PUD was a priority.

“I knew it would lead to more and bigger problems if the PUD was not privatized. There will be uncontrolled blackouts as the infrastructure breaks down. The debts will also pile up due to the high system losses and low collection rate, together with the compounding interest rates that power suppliers were imposing,” he said.

Gordon said privatization was the key to solving the power distribution problem. “But from the beginning, there was resistance [not only by the political opposition] but also by the PUD workers, who relied on [the department] for their income,” he said.

But Mayor Rolen Paulino, the city’s former vice mayor, blamed the Gordon administration for the power debt not only for the technical losses but for engaging in “corruption and patronage politics for subsidizing [local and national government entities].”

Paulino acknowledged that he was initially against the PUD’s privatization. “But when I saw that the local government was not able to address the [widespread] corruption in the power distribution system, it was then that I supported privatization,” he said.

He said it was also not true that it was delayed due to the opposition in the city council.

Gordon insisted that Paulino and then Zambales Rep. Ma. Milagros Magsaysay, including opposition councilors in the minority, had opposed the privatization and delayed it.

“This could have been done a long time ago. The reason why I ran for congressman was that I was fighting for debt condonation by PSALM, and to ensure that a congressional franchise was given to the winning bidder of the privatization. All this was delayed for many years, making the situation worse and unmanageable,” he said.

Gordon said it was only when San Miguel Energy Corp. became part of Olongapo Electricity Distribution Co. Inc. (OEDC) when it acquired a minority share in the company did Magsaysay endorse OEDC’s franchise in Congress.

25-year franchise

The PUD was sold for P610 million to OEDC, which was given a 25-year franchise to take over the city’s power distributor.

Gordon said that by the time Magsaysay supported the privatization, the PUD’s debt had become so huge and the power outages so frequent.

He said the political opposition capitalized on this issue and used it to topple the Gordons from power in the last elections. Gordon lost in Zambales’ first congressional district race while his wife, Anne Marie, lost in the mayoral race.

Gordon, however, said he tried to make several changes in the PUD, including replacing its manager, to help address the technical issues confronting the system.

The new manager, Louie Lopez, an electrical engineer, said the system losses were “much higher than 35 percent.” This meant that if Olongapo bought P100 million worth of electricity from suppliers, the losses would immediately translate to P35 million for every month of operation, he said.

Out of P100 million worth of electricity that the PUD sold to consumers monthly, it would earn only about P5 million due to the low rate, he said.

“And coupled with the collection or payment rate of consumers of about 50 percent, the PUD was not only sustaining substantial losses but also racking up huge debts,” he added.

Jose Abaya, OEDC president, said his firm confirmed that the PUD was indeed suffering from heavy system loss.

“The cap of maximum allowed system loss set by the ERC is at 8.5 percent for private utilities and 13 percent for electric cooperatives. This means that losses above the cap are shouldered by the utility as losses in its operations,” he said in a statement.

“When a utility is suffering from high system loss, it is financially crippling … because it cannot recover the cost of power it has purchased from suppliers. It could not collect the right amount from its customers,” he said.

“High system loss also contributes to potential debts to power suppliers. If the utility with very high losses can only pay the generator based on the amount collected from its customers, then there will always be a balance left unpaid. This cycle will continue and compound until such time the utility can bring down its system losses to the acceptable level of 8.5 percent (for OEDC),” he said.

Lopez said PSALM should also be blamed for the power debt. “They have a disconnection policy. Why weren’t we disconnected when the debt was only about P200 million? Why only now that it has reached billions of pesos? If they disconnected early, then this would not have happened,” he said.

Residents still owe PUD about P120 million, Lopez said. “I’ll endorse that to OEDC so they can cut or collect.”

The receivables, he said, would reach more than P1 billion if these included the consumption of local and national government entities.

PUD racket

Community sources said many households and establishments, with few of them located on Magsaysay Drive, Olongapo’s main street, were under the “protection” of the PUD.

They said these households and establishments, which usually incurred thousands of pesos in power bills every month, were asked to pay only a small percentage of the actual billing in return for commissions to PUD personnel who would reset the meter or take care of the paperwork to reflect the arranged prices.

Sources also said energy theft had been a cottage industry within the PUD for many years. Because of lack of record keeping and infrastructure to digitize billing, records could be easily manipulated or conveniently lost, they said.

When asked about the anomaly, Gordon said: “That’s probably the reason there was so much resistance within the PUD’s privatization. Because they will not only lose their jobs but their other sources of income as well.”

Olongapo has about 40,000 registered consumers of electricity out of a population of 300,000. Thousands of households resort to illegal tapping, Gordon said.

What should be done

Abaya said OEDC must ensure a high collection rate to remedy the situation.

Fast facts
P1.2B -- Total energy purchased from Napocor and PSALM (P100M per month)
P540M -- Amount remitted to Napocor and PSALM (P45M per month)
P660M -- Total unpaid debt (P55M per month)
P420M -- System loss (technical and non-technical)35% or P35M per month

Guide in estimating the monthly electric consumption of appliances
Formula: Estimated monthly consumption+(appliance wattage/1,000) x number of hours use per day x 30 days
Example: 50 watts incandescent bulb at 12 hours use per day
Therefore: (50 watts/1,000)x 12 x 30 =18 kilowatt hours (kWh) per month

Table of appliances and estimated monthly consumption
Name of appliance, Wattage, Number of hours of use per day, Estimated monthly consumption (kWh)
Air-con (3/4 HP), 1,065, 10, 320
Air-con (1 HP), 1,420, 10, 426
Air-con (1.5HP), 2,250, 10, 426
Compact flourescent lamp, 20, 12, 7
Computer with printer, 300, 5, 45
Electric fan 12-inch, 60, 10, 18
Flat iron, 1,000, 1, 30
Fluorescent lamp 40 W, 53, 12, 19
Freezer, chest 12CF, 200, 20, 120
Halogen lamp, 600, 12, 216
Incandescent bulb, 50, 12, 18
Mercury bulb, 160, 12, 58
Refrigerator 7CF, 140, 20, 84
Refrigerator 10 CF, 200, 20, 120
Rice cooker 1 Ltr, 650, 1, 20
Sodium lamp, 250, 12, 90
Washing machine automatic, 435, 1, 13
Water dispenser, 300, 20, 180
Television 21-inch, 120, 5, 18
SOURCE: Olongapo Electricity Distribution Co. Inc


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