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By Efren L. Danao, Senior Reporter
The Manila Electric Co. (Meralco) and the
Government Service Insurance System (GSIS) will face off in what
Sen. Miriam Defensor Santiago had billed as “The Clash of the
Titans” as the Joint Congressional Power Commission (PowerCom)
starts its inquiry today into the high power rates prevailing in the
country.
Winston Garcia, the GSIS president, is expected
to air his charges against the alleged mismanagement of Meralco by
the Lopez family. The Lopezes own 33 percent of the shares of
Meralco, and the GSIS, 23 percent.
Santiago, co-chairman of the PowerCom with
Pampanga Rep. Juan Miguel “Mikey” Arroyo, said Meralco would be
given all the opportunity to refute Garcia’s charges. She had
already charged that Meralco was a den of criminal syndicates.
Santiago blamed the “syndicates” for the
regime of high power rates even if the Electric Power Industry
Reform Act has been in force for seven years.
The Department of Justice said over the weekend
it is considering to conduct its own investigation of allegations by
Santiago that such syndicates are operating within Meralco.
Malacañang said it would support inquiries and
forums that will clarify how Meralco charges its consumers, and as
long as such moves eventually bring down power rates, Press
Secretary Ignacio Bunye said.
Garcia, like Santiago, had claimed that some
Lopez-owned firms are supplying Meralco with lampposts, electric
wires, meters and other electrical materials. He insisted that this
had brought down Meralco’s profitability even as the suppliers
were making a lot of money.
The GSIS chief questioned Meralco’s purchase
of power from its independent power producers and wanted to know why
the company’s rates are higher than those in Cebu, when generation
costs are equal in Luzon and the Visayas.
Garcia earlier said the government pension fund
is not out to wrest control of Meralco, but only wants full
transparency and good corporate governance from the utility, the
country’s biggest power distributor. He added that Meralco was
reprimanded by the Supreme Court in 2003 and 2004 for overcharging
its customers. The High Tribunal also ordered a refund of the P30
billion in income taxes which the power distributor passed on to its
customers from 1994 to 2002, and voided a provisional increase
collected by Meralco in 2004 without the benefit of public hearings.
Sen. Juan Ponce Enrile and lawyer Estrellita
Elamparo, GSIS spokesman, also want a probe of reports that the
power consumption of Meralco’s executives, corporate offices and
branches was being passed on to consumers.
“Are we paying for their consumption? Or, are
the firm’s executives charging their consumption to systems loss?
Either way, this practice is highly questionable and unfair to all
of us,” Elamparo said in a statement.
She maintained that systems losses from
pilferage and inefficient distribution should not be charged to
Meralco customers who pay their bills correctly and promptly.
Rep. Arroyo, the House Energy Committee
chairman, urged the GSIS to bring to the proper venue such
allegations. He told The Manila Times that if the GSIS could back up
its claim, it could bring the case to court and prosecute Meralco.
‘Punching bag’
Senate Majority Leader Francis Pangilinan said
making Meralco a “punching bag” would not bring down power
rates, as he urged the PowerCom to look into the shortcomings of
other players in the power industry.
“It appears that Meralco is being demonized so
that the rest of the ‘sinners’ in the industry, particularly
government-owned corporations, go unnoticed,” Pangilinan added.
He stressed that to achieve genuine reforms, no
one should be spared from being made to account for failures in the
power industry.
“The effort of government to do a ‘slam
dunk’ by going all out against Meralco alone may make good
political noise but it won’t solve the problem,” Pangilinan
said.
Senate President Manuel Villar had urged the
PowerCom not to concentrate on Meralco alone but to investigate
other players as well. Santiago explained that PowerCom would also
inquire into reported anomalies in coal supply after looking into
Meralco’s role in the behavior of power rates, which she described
as “the highest in Asia.”
Palace support
Bunye said the Palace is supportive of the move
of the GSIS to ask Meralco to open its book of accounts.
When asked whether a congressional inquiry is
necessary to know how Meralco charges its consumers, Bunye said
Congress has its own right to conduct a separate probe, and that the
Palace supports such move if it will favor the consumers.
He added that the utility should be more
transparent and must heed the call of the GSIS for a review of its
books because “there is general public clamor for Meralco to
explain.”
Bunye said GSIS has the right to ask for a
review of the company’s books because it is one of Meralco’s
stockholders.
P1.1B in dividends
Meralco will distribute to its stockholders on
Tuesday P558 million of the P1.1 billion in cash dividends its board
had approved for the year. Of the P1.1 billion, P372 million will go
to two Lopez-owned firms, Cebu Rep. Eduardo Gullas said, citing
documents submitted by Meralco to the Philippine Stock Exchange.
Gullas added that the P558 million is half of
the P1.1 billion in cash dividends approved by the Meralco board at
a rate of P1 per share. Two Lopez-controlled firms, First Philippine
Holdings Inc., and First Philippine Union Fenosa Inc., hold a
combined 372,175,706 common shares in Meralco and will receive a
total of P372 million in dividends, according to Gullas.
The dividend beneficiaries also include the GSIS,
Social Security System, Pag-IBIG Fund and the Philippine Health
Insurance Corp.
“There is nothing wrong with Meralco making
money, provided it is based on a reasonable rate of return,”
Gullas said.
Last week, Meralco reported a net income of P655
million in the first quarter, up 23.2 percent from the P532 million
it realized for the same period in 2007. The company posted a net
income of P3.61 billion in 2007.
Probing ‘syndicates’
Also over the weekend, Justice Secretary Raul
Gonzalez said his department may conduct an investigation on matters
that concern public interest, like the supply of electricity as in
the case of Meralco.
“We’re studying that because she [Senator
Santiago] speaks of criminal syndicates. But we do not jump into the
lake immediately and we’ll study it carefully,” Gonzalez said.
He added that the National Bureau of
Investigation, an agency under the Justice department, may lead the
probe by gathering the needed evidence to substantiate Santiago’s
claim.
-- William B. Depasupil, Angelo S. Samonte And Jomar Canlas
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