POSTSCRIPT / July 3, 2012 / Tuesday


Philippine STAR Columnist

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Drop PCSO’s supplier of fading Lotto tickets

FADING WINNINGS: The Australian firm supplying those poor-quality Lotto tickets that fade before the winner can claim his prize is angry with the Philippine Charity Sweepstakes Office for terminating its 50-year contract.

The firm, the TMA Group of Companies Pty. Ltd., is even taunting President Noynoy Aquino to whip PCSO chair Margie Juico into following his ”Daang Matuwid” rule by curbing what it said were PCSO abuses.

TMA said the PCSO disregarded court orders for it to honor its Joint Venture Agreement with the paper manufacturer. A PCSO director said, however, it was actually a mere supply contract disguised as a JVA.

Our unsolicited opinion is: Change the supplier of those fast-fading Lotto tickets to be fair to bettors. (Btw, the 6/55 Lotto jackpot broke the P143-million mark last night.)

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GROSSLY PREJUDICIAL: “The JVA is not within the PCSO’s corporate purpose and mandate,” Juico explained. “Furthermore, the JVA is grossly prejudicial to the interests of PCSO.”

Note that the Senate Blue Ribbon committee made the same conclusion in 2011 after a public inquiry into the deal. It also recommended filing of graft charges against the previous board led by then chair Manuel Morato.

The present board could get itself into legal trouble if it did not void the questioned contract.

Under the 2009 contract, TMA was to supply the PCSO with free thermal paper for 50 years (originally 25 years, renewable for another 25) with an estimated value of P42 billion.

In return, the Morato board allowed the TMA to put up a thermal paper factory in joint venture with it and to export its paper in excess of the PCSO requirements.

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NO PCSO POWER?: A basic question is whether the PCSO has the power under its charter to process and approve, for a material consideration (free thermal paper), the putting up of a joint venture with a foreign company.

A TMA director said that their firm will invest P4.4 billion this year for expansion of its Philippine operations. However, promises of pouring additional investments have nothing to do with the legality of the contract.

But the accusation that the PCSO is defying a court order for it to respect the JVA with TMA is something else. What if the court eventually voids the contract? Is there a bond or warranty to cover that ugly turn of events?

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BIGGEST WINNER: The case has caught my attention, because of the poor-quality thermal paper of lottery tickets.

Countless winning tickets, including some for jackpots, are rendered invalid after they fade in only a few weeks — although winners have one year to claim prizes.

The unclaimed prizes, running into millions, go into a special Malacañang fund. We have a bizarre situation where the biggest lottery winner is actually the President, and he does not have to buy a ticket to collect!

The Juico board is right in voiding the TMA contract. It should look for a supplier of better paper – after also reevaluating the quality of its printing equipment.

(I have in my wallet US PowerBall lottery tickets bought five years ago. Their print is still as clear as this text you are reading. The Filipino deserves something better.)

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EAT STATISTICS?: The day is nigh when the poor and the hungry are again to be fed with statistics and PowerPoint presentations. The day is July 23 when the President serves an expectant public his State of the Nation Address.

In anticipation of the SONA, the independent IBON Foundation has evaluated the socio-economic performance of the administration’s initial two years.

Reacting to the administration’s claim of “rapid economic growth in the first quarter of 2012, looming investment-grade credit ratings, and even creditor nation status,” IBON Executive Director Sonny Africa said:

While these indicators of supposedly sound macroeconomic and fiscal fundamentals are appealing to banks, credit rating agencies and investor groups, they do not reflect the reality of continuing problems for the economy and tens of millions of Filipinos.”

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INVESTMENT DOWN: “The reported high 6.4-percent growth in Gross Domestic Product in the first quarter is welcome,” Africa said, “But it appears largely due to a surge in government spending that is likely to be temporary.”

He went on: “Government consumption grew 24 percent from a 15.8-percent contraction in the same period last year, while public investment grew 62.2 percent from a 37.9-percent contraction.

“In contrast, household consumption only grew marginally faster to 6.6 percent from 5.9 percent last year while private investment actually shrank by 9.9 percent from 23 percent growth last year – indicating that the private sector did not seem to share the administration’s optimism in the first quarter.

“Overall investment actually contracted 23.5 percent from 36.1 percent growth in the first quarter of last year.”

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UNDEREMPLOYMENT: Africa noted that the most important sectors of the economy slowed substantially in the first quarter. Growth of agriculture dropped from 4.4 percent last year to just 1 percent and of industry from 7.3 percent to 4.9 percent.

Yet these are the sectors that are supposed to create the most jobs, have the greatest productivity and be the main drivers of economic growth.

Based on National Statistics Office data, IBON estimates that the number of unemployed and underemployed Filipinos has increased by 780,000 in the last two years, from 10.9 million in April 2010 to 11.7 million in April 2012 – consisting of 4.4 million unemployed and 7.3 million underemployed.

While the unemployment rate over the same period fell from 11.4 percent to 10.3 percent, this was more than offset by rising underemployment which rose from 17.8 percent to 19.3 percent.

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(First published in the Philippine STAR of July 3, 2012)

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