Sent to Rigoberto Tiglao by Carlos Baldago July 22, 2014


Subject: Screw Meralco

Your observation on Meralco made me think that all government-approved franchises/licenses to private sector to operate and manage public utilities should be revoked and revised by the next government based on the argument of contestable markets. Existing franchises should carry guarantee perpetual benefits without periodic review of operations.

I am pretty sure all legal contracts of the government with all private operators of public utilities come with fiscal sweeteners for them to undertake capital investments so much so that rates of return are guaranteed, and that operational expenses, tax exemptions, and foreign exchange risks are charged to the general public. Therefore they are expected to provide continuous service since private profits are already assured. There are no excuses for poor performance.

Now, should the private operators of public franchises balk at government and/or the general public suggestions to improve/remedy bad, inefficient service or suggest new investments (ie telecom lines shld be underground), the government should cancel their franchise/license and proceed to open the market for other interested private party/ies willing to accept the new conditions.

Secondly, private operators of public utilities must set aside a large portion of their guaranteed profits to re investment in the same public utilities. At no instance should they re invest proceeds to similar public utilities outside of the Philippine territory. Failure to do so, would result to automatic forefeiture of all physical and financial assets of the private operators of public utilities.

A competent government has in its powers to regulate all public utilities to make them deliver agreed services to the general public.

Mr. Carlos Baldago


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  1. Larry Ebersole on

    Indeed we the people had been sold by our congress who granted these franchises, when they made no time frame for the ROI provision of the franchise, which led to these operators to abuse the people. Look at Meralco that charges all their losses to the public including their own operating cost.They do not even mind those thieves that steal because it is paid for. That is the same as to Water and Telcos and even the Tollways and power generation. Again you can see all these PPP’s that the present government has gone into. Why do you think that at this present government, we had so many Philippine personalities and corporations had come out to invest on these PPP project….It is the first time I have notice this. Do you really think this is just
    because of NATIONALISM ????

  2. Agree with Mr. Baldago on his statement that “A competent government has in its powers to regulate all public utilities to make them deliver agreed services to the general public”. The money that’s reinvested in other countries is much bigger than the DAP and PDAF combined. Somebody is not doing his job here! What controls does the government have before turning over vital utilities to private corporations.
    Do we need another whistleblower here?