POSTSCRIPT / November 12, 2006 / Sunday


Philippine STAR Columnist

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Only Atong Ang can say if he would rat on friends

TAMA NA PO!: Policemen went last weekend to the Palace working area of journalists covering President Gloria Arroyo to arrest Business Mirror reporter Mia Gonzales, who is vice president for print of the Malacanang Press Corps.

Gonzales is one of the 43 journalists — a record number — sued by First Gentleman Jose Miguel Arroyo for libel. The suit stemmed from her article titled “Will She Now Change?” that came out July 7, 2004, in Newsbreak magazine.

The policemen told her colleagues that they just wanted to ask her questions, but the entry in the logbook at the entrance reportedly showed their mission was “to serve warrant” that Saturday when it was impossible to post bail.

President Arroyo may want to talk to her husband about his serial libel suits that are dragging down her presidency. Her critics might say that the First Couple are running amuck.

In the Gonzales incident, btw, Press Secretary Ignacio Bunye — like a good father — could have volunteered to have her released to him on recognizance. She covers her Malacanang beat regularly anyway, appears ready to face the charges, and there are no indications of possible flight.

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CHILLING WARNING: The National Union of Journalists of the Philippines said: “The attempt to arrest and detain journalists who have written unfavorably about the Arroyo administration is a brazen violation of the freedom of the press, coming on the heels of the serving of arrest warrants against Malaya editors and staff, also on libel charges filed by Mr. Arroyo.

“That the attempt to arrest Gonzales was made right inside the Palace grounds, which is not only her workplace but also home of her accuser and his powerful spouse, the President of the Republic of the Philippines, cannot but make us suspect that this was a deliberate attempt to send a chilling warning to journalists that no place is sacrosanct when it comes to appeasing the whims of the mighty.

“We firmly reiterate our position on the libel spree Mr. Arroyo has embarked on: He and his wife should face the issues raised against them where they are best addressed — in the arena of free and democratic discourse.

“They should stop harassing journalists and stop using an antiquated libel law as a tool to silence criticisms against this administration.”

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PRIVATIZATION: As a rule, government should minimize playing a direct role in businesses that are best entrusted to private hands. It should get out of the business of running major corporations.

While government sometimes needs a presence, if only to ensure that public interest is safeguarded, it should second the business of running businesses to the private sector.

The world has learned a costly lesson from the failures of ambitious nationalization schemes. In country after country, these programs propped up by police powers were hailed as tributes to the working man.

Alas, in all but a few exceptions, they have been proven inefficient and, worse, have become vehicles for corruption. This black track record is not surprising as the most avid advocates of nationalization have been authoritarian regimes, if not outright dictatorships.

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HIT AND MISS: In the Philippines, privatization has been mainly a game of hits and misses. The rules are not always clear nor transactions transparent. The terms keep changing in midstream. If they are laid down, they are sometimes set aside for favored parties.

These days, we are awaiting the bidding of government shares in Transco — a planned sale that has, until lately, been marked by urong-sulong — and in Maynilad Water Services Inc. that holds half of the Metro Manila water franchise area.

Transco (National Transmission Corp.) is into power, providing the link between generators and users of power, while Maynilad is into water. Both impinge on basic needs and count high among the criteria of human development goals.

The impending sale of the 84-percent equity of the Metropolitan Waterworks and Sewerage System in Maynilad has raised complaints and criticism from non-government organizations.

President Arroyo’s thrust to rid the government of the burden of running business firms is laudable, but the NGOs are raising valid points. We know, for one, that MWSS is divesting its share in a flawed privatization experiment.

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NGO SUGGESTIONS: The government is in the right direction in privatizing the MWSS’s share, but there is a need to ensure that past mistakes do not recur.

The Katipunan ng mga Anak ng Bayan (Kaakbay) and the Freedom from Debt Coalition (FDC) are not the usual muckrakers. A close reading of their briefing paper on the Maynilad bidding shows some interesting proposals, to prevent a repeat of history or, worse, the creation of even more serious problems.

The NGOs propose that the Regulatory Office must not be within the MWSS structure. They note: “This is to maintain its independence from the MWSS and the concessionaires, otherwise MWSS and the concessionaire may join forces to bypass or get the RO to make biased decisions.”

They propose that RO members be selected from a reputable pool of public and private personalities. There is already a working model for this, which is the Energy Regulatory Board. If the government can have this kind of RO for power, it could have the same for water.

The NGOs also call for the strengthening of the RO with technical expertise, even from international consulting and engineering companies, to be able to study and decide on issues (such as on rates and taxes) and monitor performance.

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MORE ZONES: The primer of Kaakbay and FDC on Maynilad outlines sober, well thought-out alternatives. Who can quarrel with the need for stricter, stronger and effective provisions to ensure the achievement of water supply standards and performance commitments?

The groups also suggest a review of terms of reference to reflect the realities of the West Zone, which has some eight million consumers and which hosts around 80 percent of the 200 waterless areas in Metro Manila.

They offer the option of the West Zone being divided into two or three more zones classified to reflect the reality of the work and standard of performance that will be required.

My only fear here is that a division of zones into such categories could see companies making a beeline for the easiest one and thus leave our poorer brethren in a prolonged state of neglect.

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STRICTER SCREENING: Another suggestion of Kaakbay calls for better screening of bidders. Indeed, there should be no more repetition of the shameful controversies that have besmirched the country’s reputation with the international business community.

This problem has been traced to a cavalier attitude towards choosing winning bidders, with vested interests and the padrino system often given greater weight than the national interest.

While the participation of the Ayala Group (which holds the other half of the Metro Manila franchise area) in the Maynilad bidding has been questioned on the issue of a possible monopoly, the groups did not question the efficiency of the corporate giant.

Leaving that point aside, we look at another entity identified as Karukanaran Ramchand of India. Kaakbay focused on it because its local partner, Strategic Alliance Holdings Inc., is owned by controversial businessman Cezar T. Quiambao.

He has been in the news lately, because of cases filed by a firm he previously controlled, the Star Infrastructure Development Corp. (SIDC), and allegations of other anomalies in another firm he also controlled, Citra, of the Skyway venture.

Cases filed by Star in the Pasig Regional Trial Court allege that Quiambao issued unauthorized advances, worth more than P100 million, to his other private companies, including Stradcom, which is reportedly also the beneficiary of a contract for the Land Transportation Office computerization program.

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REHASHED CASES: Quiambao called the Star cases “rehashed,” saying that similar cases had been filed and dismissed in Batangas, where the company has operations. Star executives say this is not so, but let us leave the courts to determine that.

Of the Citra issues, Quiambao says these are internal corporate disputes with no bearing on public interest. This is a point disputed by Kaakbay, which says that a track record of allegedly anomalous transactions, brought to light by business partners, should alert privatization officials.

When such internal business disputes involve charges of financial fraud, the government should look closer. Misuse of funds supposedly earmarked for utility or infrastructure development has a way of being shouldered by taxpayers, usually when government has to step in when the crisis reaches unmanageable levels.

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(First published in the Philippine STAR of November 12, 2006)

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