POSTSCRIPT / February 21, 2006 / Tuesday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Ask officials what they have done for the country

“And so, my fellow Americans: ask not what your country can do for you — ask what you can do for your country.” — So said US President John F. Kennedy toward the conclusion of his inaugural address on Jan. 20, 1961, in Washington, DC.

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TWIN QUESTIONS: There must be some way we can line up our officials, from the President down to the last mayor, and ask them straight: What have you done for the country since you assumed office?

They can reply for the record in either of two ways: Talking before a video camera for one minute, or writing down a response in not more than 500 words on a sheet of paper. No reshoot, no erasures, no extension. And no coaching, please

Before they get up, they are given another one minute on camera or another sheet of paper to answer this followup question: And what have you done for yourself, as well as your friends and family, while in office?

We then give their answers the widest dissemination and severest scrutiny.

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SYSTEM FAILURE: Some of us who have grown cynical may insist that the officials make their declarations under a solemn oath, or while wired to a lie detector. That is worth considering.

Now if I were the owner of a giant print or broadcast organization, I would send multi-media crews to pin down all officials starting from the top to document their impromptu answers to the twin questions.

Or by common agreement in media, we can always preface any live interview however short with the question “Sir/madame, what have you done for the country since you assumed office? The truth, please.”

Then, when time permits, we turn around and relay the answers to the people. We may not be able to scrutinize and challenge all their declarations, but we will have them on file for future reference.

But, you may ask, why do we have to go through such an unusual ritual? Kasi po, our institutions and due processes relating to public accountability no longer function as they should.

Many of us have started to think outside the constitutional box, and that is dangerous. We have to do something about that or we all perish.

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RECOVERY SIGNS: President Gloria Arroyo and her revenue-raisers are exultant over what they said is the marked improvement in revenue-collections, the rise of the peso versus the US dollar, and the encouraging signs of recovery in the nation’s economy.

The President points to the imposition of the 12-percent Value-Added Tax as one of the reasons for this surge in revenues.

It is amazing how she is able to measure the velocity of VAT earnings when the 12-percent tax was imposed only a few weeks ago. Maybe she said that for the consumption of foreign lenders and their IMF-World Bank accomplices?

The more credible reason is the other factor she cited — the increased influx of foreign exchange, mostly US dollars, from our countrymen laboring in vineyards abroad.

The Central Bank tells us Filipinos abroad remitted some $10.7 billion last year through formal channels, including banks. Add the dollars sent via informal media, like padala, and the figure could go up to $12 billion. This revenue inflow we can easily believe.

The dollars, btw, not only shore up our finances, but also improve the fighting chance of the peso against the US dollar.

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WHY RISING PRICES: But VAT collection as a big revenue shot in the arm for our cash-strapped government is something else.

With due respect, I doubt some of those VAT collection claims, considering the widespread tax evasion ongoing, the corruption and the failure of merchants to remit the resultant tax (output VAT minus 70 percent of their input VAT) promptly to the government.

Whatever it is, all that technical discourse on foreign exchange, revenue, exchange rate, input VAT, et cetera, is often reduced to an oversimplified gut question by Juan Pasang Kruz (no relation to our friend Neal Cruz).

On the impressive inflow of dollar remittances, which government economists say have improved the exchange value of the peso, the common tao clutching his growling stomach asks: If that were so, how come prices are still rising?

Sorry I am neither a doctor nor an economist to be able to answer that one.

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PRIVATIZE NAPOCOR: Serious businessmen in the power industry say that the privatization of the National Power Corp. could benefit us in two ways:

First, proceeds from the sale of Napocor power plants could be used to lower our national debt to which the state power firm contributes a hefty share.

Second, achieving 70 percent of privatization as mandated by law could signal the entry of foreign investors, thus ensuring lower electricity rates and a stable investment atmosphere, particularly in the energy sector.

They add that the proceeds of on-schedule privatization coupled with revenue collected from the 12-percat VAT (assuming the figures are right) could help ease the budget deficit.

Billions of pesos saved from debt servicing, they added, could be diverted to the delivery of basic social services such as livelihood opportunities, more schools and dwellings, as well as infrastructure needed for development.

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BARYA FOR SERVICES: Napocor’s debt has reached more than one trillion pesos, both in local and foreign loans, with only P800 billion of it reported by the government to the public.

Our consolidated public sector debt has reached a staggering P5.5 trillion, according to some serious private estimates (of course the government figure is lower). Of that amount, more than P3 trillion has been attributed to foreign debt, the rest to domestic borrowings.

The government is allocating more than 30 percent (P300 billion or more) of its annual budget to debt servicing. This means that for every budget peso, at least 30 centavos are gobbled up by maturing debts.

Add to that the supposed 35 centavos (of every peso) that feed corruption and pork barrel, plus big chunks going to general government (administrative), and what is left for essential services is hardly 10 centavos for every peso in the budget.

No wonder even the $36 billion in recovered Marcos wealth, which was supposed to be used only for agrarian reform (except for P8 billion for victims of human rights violations) had been diverted to the public money stream.

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NEW POWER FIRM: What do we do with the power sector where the biggest player is still the Napocor, whose officials are resisting mightily its privatization mandated by law?

Albay Rep. Joey Salceda proposes the consolidation of the country’s state-owned power firms into a so-called “Philippine Power Transmission and Generation Corp.”, and the sale of its shares to the public to fast-track the completion of the power sector privatization plan.

An economic adviser of President Arroyo, Salceda said that he had submitted this suggestion to the Chief Executive. He proposed that this be done this year in view of delays in the privatization of government power assets.

He said the selling of shares of state-owned firms — Napocor and the National Transmission Corp. (Transco) — through a listing on the stock exchange would be a much easier way of completing the privatization plan.

Under his proposal, the government will initially sell 60 percent of the Philippine Power Transmission and Generation Corp. and hold the remaining 40 percent. The government can take charge of the firm’s management at first, and then let a private sector controlling the biggest share to take over.

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INVESTORS WARY: Many businessmen studying Salceda’s proposal see some good features in it. But they call attention to two points:

  1. Investors are hesitant, even wary, to enter the power sector because Napocor has failed, or is deliberately sitting on the preparation of proper documentations of the generating companies (gencos). Many assets do not have titles, environmental certificates, and the like.
  2. The proposed PPTGC will undermine an existing law (Electric Power Industry Reform Act) that was painstakingly debated and eventually passed more than four years ago.

Will the Salceda formula mean government wiping the slate clean, throwing away years of hard preparation, and changing the rules again in the middle of things?

Nakapapagod na po ‘yan. Ano ba talaga ang gusto ng Arroyo administration? Let’s just do it!

The people remember President Arroyo saying that the Epira, which she pushed Congress to pass way back in 2001, would reduce our foreign debt and cut electricity rates. What ever happened to those two promises? Zapped!

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(First published in the Philippine STAR of February 21, 2006)

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