Panglao Airport dialogue this p.m.

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City to reject drainage project

This is not Lent - and this is not an act of self-flagellation. But something doesn't quite fit.

The Philippines is the only Christian nation in the Far East but is also the most corrupt in Asia. It has one of the highest population growth rates but with the one of the lowest per capita income in the region. It has one of the richest agricultural land there can be but is the world's biggest importer of rice. It used to be a haven of good English-speaking labor then; today it has one of the highest labor cost in the region of workers with broken English and prone to be Juan Tamad.

Now as if that is not all - by latest count, the Philippines has the second highest cost of power in the entire Asia - next only to colossal Japan, an industrial giant who can afford that.

Are you still wondering that despite Government propaganda, the Philippines is still one of the least desired investment in Asia? Why deal with corruption - when once it was limited to Marcos and his cronies - it is now endemic and systemic from the clerks upwards. "Tongpats" is an ugly word that is apt for the country - a parody of the word "patong" or "bukol" as whistle-blower Jun Lozada would call it. Add to that - expensive, inefficient labor and an oh-shocks explosive power rates.

Not all investors are suicidal, beautiful girl.

Therefore, the titanic struggle between the GSIS (35%control) and the Lopez Group (33%) for the control of Meralco, the monopolistic power distributor to much of Luzon is not a simple matter of "reverse privatization."

Or simply put, the Government taking over a franchise utility company that should better be left at the hands of the private sector.

Because if the Government does that by letting GSIS take over Meralco - and the Energy Regulatory Commission regulates it - it is an act of mental dishonesty. Because Government cannot regulate itself.

But if Government, through the GSIS, is just there to ensure that the Philippines will finally have lower power rates, then let the ax fall where it should.

By all means, if there are "sweetheart deals" where Meralco buys its meters, transmission lines, poles from family-owned subsidiaries and power (50%) from its own three so-called IPP (independent power plants) - then there is ground to question this "self-dealing." Are there cheaper available alternatives in the marketplace for these supplies? Can these alternatives be had - without breaking the Lopez ownership and management control of Meralco?

Why is Meralco passing its "system losses" - counting by the billions - on to the consumers with a carrying cost of 12% yet. When has corporate inefficiency been a public's burden to carry? Why the interest rate? No loan was borrowed.

It is bruited that Meralco has more officers than clerks - an abomination, in any language - and pays P170 million in salaries and perks to senior officers and board members. Moreover Senator Juan Ponce Enrile questions why the 72 million kilowatt-hours consumed by Meralco for operations passed on the billings of consumers.
From the accounting point of view, that looks like an operating expense that cost of services item.

Now, the Government, through the Solicitor General is moving to rescind a settlement agreement between Meralco and the Government in 2003 to erase P27-billion Meralco debt to Napocor. Now the formula is to impose an interest cost to that of P28 billion. If implemented, can Meralco then pay P55 billion right off without the risk of insolvency?

But in the first place, why was there such a settlement?

There is no rhyme nor reason for Government to condone a debt from a private firm like Meralco that is owed to a government corporation like Napocor without risking the latter's bankruptcy - given that magnitude.

Government, in short, is not completely blameless. What has ERC been doing through these years is to allow Meralco to charge rates almost without honest-to-goodness benchmarking.

Government, likewise, cannot blame Meralco for buying power from Napocor at peak periods since power cannot be stored and has to be accessed at need. That's a brainless argument.

Government should instead answer why the cost of Napocor power brought from its own IPPs are relatively exorbitant since Government buys per shipment instead of through long-term supply-price agreement. There are talks of multi-million kickbacks in Napocor's purchase of coal, likewise.

Are these the reasons why Napocor remains un-privatized up to this date? What about Transco - a former government entity - why does it cost so much to transmit power from the source Napocor to Meralco? Who is regulating Transco's profits?

It is good that the finger-pointing has not stopped. Because this has exercised the public in widening its perspective as it stands, there is no white knight between the Government and private sector as of now. Both are guilty and contributory to the appallingly expensive power cost in the country.

If there are no genuine reforms and cleaning up of the stable of both Government and Meralco - it doesn't matter really who runs Meralco. The winner could just be the cleaner crook, but a crook just the same.

One thing sure, though, without adequate and reasonably priced power -we will be an investment joke of Asia. And the consumers will bear the high cost of ordinary living -paying so much to greedy Shylocks - just for watching TV, having a refrigerator and electric iron and enjoying rest with air-conditioning units at home.

Do you wonder why million Filipinos leave the country every year?