A LOCAL debt watcher affirmed the top corporate rating of Philippine Savings Bank (PSBank) on the back of continued growth in the lender’s core interest income and strong market position.
In a statement sent to reporters over the weekend, the thrift bank secured a PRS Aaa (corp.) rating from the Philippine Rating Services Corp. (PhilRatings), or the highest corporate credit rating on the firm’s scale.
This means that the lender has a “very strong capacity” to meet is financial obligations within a one-year horizon.
The credit rater took into consideration PSBank’s solid market position, its well-defined and forward-looking strategy, highly-experienced management as well as continued growth in core interest income, attributable to loan portfolio expansion.
PhilRatings added that the savings banking arm of Metropolitan Bank & Trust Co. is a “significant” player in the consumer lending market driven by its car loan portfolio, which is expected to log a “moderated but still positive” growth this year.
PSBank’s consumer lending, accounting for 91.4% of its total loan book as of end-2018, tallied a compound annual growth rate (CAGR) of 14.2% between 2014 and 2018. Broken down, the CAGRs of PSBank’s auto and mortgage loans stood at 18.2% and 9.6%, respectively.
“Despite the significant decline in auto sales resulting from the implementation of the Tax Reform for Acceleration and Inclusion Act, PSBank managed to keep its market share of about 17.0%, which serves as an indication of the bank’s solid franchise in its chosen market,” PhilRatings said.
In a previous interview, PSBank President Jose Vicente L. Alde said the lender expects its consumer loans to “be better than last year’s” on the back of easing inflation and other factors, which will translate to softer loan rates.
PhilRatings added that the bank’s net interest income has been posting double-digit growth from 2015-2017, in line with the expansion of its loan portfolio.
Meanwhile, PSBank’s “solid” market position is seen to be supported by the digitalization of its products, channels and processes, enhancing customer experience and improve operational efficiency.
“[R]ecent product and service offerings have become more technology-based, as the bank prepares for the next generation of bank customers, who are seen to have more choices and be more demanding,” PhilRatings noted.
The debt watcher added that the digitalization push as well as the “solid” industry experience of its management headed by Mr. Alde will strongly support the lender’s competitive position going forward.
PSBank tallied a P2.7-billion net income in 2018, flat from the previous year’s level, even as its lending and deposit-taking businesses continued to expand.
The Ty-led savings lender ended 2018 with 250 branches, 575 automated teller machines and total assets worth P237.7 billion.
Shares in PSBank stood at P58 on Friday, up 70 centavos or 1.22% from the previous close. — K.A.N. Vidal
WASHINGTON — China’s lengthy approval process for genetically modified crops remains a sticking point in talks to end the trade war between China and the United States, according to two sources with knowledge of the talks.
Beijing has taken years to approve new strains of GM crops, which U.S. companies and farmers have complained stalls trade by restricting the sales of new products from companies such as DowDuPont Inc, Bayer AG, and Syngenta AG.
The issue is one of a host of U.S. complaints that the administration of President Donald Trump is demanding China address if it wants to end trade disputes that have cost both countries billions of dollars and slowed the global economy.
Trump on Thursday said the two sides were getting very close to a deal that could be announced in about four weeks, though there were still differences to be bridged.
GM crops and the approval process are still a “big issue” in the discussions, said one of the sources, who spoke on condition of anonymity.
The issue has been a source of tension between the two countries for years. China is the biggest buyer of U.S. soybeans, the bulk of which are genetically modified. If it does not approve new strains, then farmers in the United States cannot plant them because China may reject shipments that include them.
Seed companies cannot fully commercialize sales of new strains without those approvals. The two sides had appeared to make some progress on the issue in January, when China approved a handful of GMO crops for import. They were the first in about 18 months. The move did not address the core U.S. concerns over delays to the process.
A spokeswoman from the Office of the U.S. Trade Representative, who is leading the Washington team in the discussions, did not respond immediately to request for confirmation or comment.
China’s Ministry of Agriculture and Rural Affairs did not immediately respond to faxed questions on Friday, which was a public holiday in China.
It is unclear what differences on the issue remain. The United States wants China to accelerate its approval process and make it more similar to Washington’s.
Beijing allows imports of GMO soybeans and corn for use in animal feed, even though it does not permit planting of them.
China bought about 60 percent of U.S. soy exports, worth about $12 billion, before the ongoing U.S.-China trade war and could reject shipments of unapproved varieties.
Beijing promised to speed up its review of applications during previous trade talks with the United States in 2017. In the past, Beijing has held back approvals of imported GMO products amid concerns about anti-GMO sentiment in China.
The trade deal, should it be agreed, is expected to include a six-year time frame for purchases of more than $1 trillion in U.S. goods, including commodity products. — Reuters
SHARES MAY edge lower in the following days as investors take a break for the upcoming Holy Week.
The bellwether Philippine Stock Exchange index (PSEi) firmed up 0.24% or 19.05 points to close at 7,873.18 last Friday. However, it was down on a weekly basis by 0.6% or 47 points, weighed down by the 2.5% decline in mining and oil and a 1% drop in services.
Turnover slowed by 1.53% to P5.54 billion. Net foreign buying persisted for the week, albeit 21% lower to P573 million.
“Investors may continue to sit on the sidelines as we go into to the holiday season and maybe wait as long as after the election in May. Because of this, we may continue to see the index go lower,” Eagle Equities, Inc. Research Head Christopher John Mangun said in a market report.
Mr. Mangun noted that the PSEi has held its support level at 7,840 in the past two weeks, but has yet to break above its resistance of 8,000.
“The general investors sentiment has gone from “cautious” to “extremely cautious” as investors are probably anticipating an event that would be negative for the market or possibly waiting until the end of an event that could go either way,” he explained, noting that this event could be the upcoming midterm elections.
“The bottom line is local investors are staying away indefinitely and this will cause the market to go lower.”
Meanwhile, online brokerage 2TradeAsia.com highlighted the slower inflation result in March. The Philippine Statistics Authority reported on Friday that headline inflation last month stood at 3.3% — lower than the market consensus of 3.5%.
“For now there’s room to welcome the outcome, as tamer prices will induce consumer and investment spending,” 2TradeAsia.com said, although noting that the impact of El Niño on agriculture and water could still affect inflation moving forward.
2TradeAsia.com also noted that investors may change their portfolio mix in the second quarter.
“Build-up in local political campaign plus expected bond float from some of the market’s large caps might prod changes in portfolio mix, at least over the second-quarter run. Special emphasis could divert part of the liquidity on coupon returns from corporate bond floats, especially for investors that have little appetite for risk,” the online brokerage said.
Investors are also seen to look forward to shareholders’ meetings lined up for the month, most of which will happen after the Holy Week break from April 18 to 19. 2TradeAsia.com said this could drum up excitement on corporate expansions, dividend declarations, and other capital-raising exercises.
Eagle Equities’ Mr. Mangun placed the PSEi’s support level from 7,800 to 7,900, with resistance from 8,000 to 8,140.
Financial markets will be closed on Tuesday for the Araw ng Kagitingan holiday.
EVER thought of franchising a business? Here is how you can determine how you can invest your hard-earned capital in a franchising business without wasting time and effort.
Velle Cacha-Manuel, group marketing manager of Francorp Philippines, said a good franchise is unique, profitable, and systemized.
Franchising, which she defines as a method of practicing and using another’s perfected business concept, should also offer a continuous transfer of knowledge. She said one of the main advantages of franchising is “there is a strong branding and brand recall. You don’t have to do it from scratch.”
Given that the brands open for franchising are already established, a franchisee can be assured of making profit. Of course, there are disadvantages, like having to follow a system consistently in terms of pricing, location, and territorial restrictions. There is also the chance to still fail.
Before signing the franchising contract, a franchisee should consider several factors, while answering questions such as why the need to own a franchise. Most of the time, the answer is wanting another source of income. The next step is to start researching about the brand and to look for features that are of interest to the franchisee.
“Is it a unique brand and concept that you love? Is this a product or service I love and I would want to pay for. You have to be the first and last customer of your brand, of your franchise,” Ms. Manuel said in a seminar during the Franchise Asia Expo 2019 held in Pasay City from March 29 to 31.
The would-be franchisee should also look into his or her understanding of the business, including how it matches existing resources (time, experience, and capital to be invested). A check on the track record of the franchisor is also valuable. A visit to one of the franchise stores of the target business is a must to get more information about it through current franchisees. The franchisee should also assess what makes the brand different from its peers.
Extra attention should be given to the terms and conditions involved in the agreement, which should include the renewal process, the required capital investment and fees (franchise fees, royalties, marketing contribution, and training and support), the purchase of products, territory, and termination.
A knowledge of who made this important document is key to avoiding “scam-ish” deals. Brands that present too-good-to-be-true claims tend to pressure franchisees. They usually have no list of franchisees and outlets, and have a vague company profile.
“Ask who developed the franchise program. The last thing that you really don’t like to happen is Google your franchise agreement since they don’t have an operations manual. If they really can’t tell you if they have an operations manual and no other parties are involved in doing their franchise program then that maybe is a red signal to take a step back,” she said.
When asked about her advice to those who want to venture in this kind of business, she told BusinessWorld after the seminar, “You have to be ready in the submission process when you go into franchising business because that’s really how it will work. It’s really duplicating the success of the brand. You have to be in love with the brand, believe in its purpose, believe in its mission kasi ‘yun ‘yung mga [because those are the] valuable stuff that will really ignite them to continue the business.”
Francorp Philippines is part of the worldwide franchise consulting firm Francorp, which is based in Chicago. It also has consultants in South America, other parts of Asia, Middle East, and South Africa. Francorp Philippines’ clients account for 25% of the total franchises in the country. The firm works with more than 5,000 entrepreneurs per year through seminars, events, and other activities. Some of its clients are Jollibee, Potato Corner, Max’s Restaurant, Chatime, Goldilocks, and Pancake House.
The event organizer, Philippine Franchise Association, is a voluntary self-regulating body for franchising in the country. Its members range from micro to large businesses both from the Philippines and abroad in the fields of food, retail, services, and other types of businesses.
Not many people may realize it, but there has been a bountiful harvest of legislation from the 17th Congress. Both Houses of Congress have produced significant economic and socially progressive legislation since signed into law by President Duterte. Credit no doubt goes to House Speaker Gloria Macapagal-Arroyo and Senate President Tito Sotto, both legislative veterans who know how to make their respective chambers productive.
While many recently passed laws are good, a few belong to the “good intentions but unforeseen consequences” category. An example of the latter is the 105-day Maternity Leave Law. It will saddle private employers and the Social Security System with paying for the benefits provided in that law, an unnecessary added financial burden for SMEs (Small and Medium-sized Enterprises). The irony of the law is that while it may seem pro-women, the consequence may be that companies will hire fewer women given prospectively higher financial costs of female employees going on maternity leaves.
Another recent law that effectively taxes labor-intensive firms is the law declaring December 8, or the Feast of the Immaculate Concepcion for Catholics, a special non-working holiday. The Philippines already has the most non-working holidays in Asia and adding another holiday is an onerous burden to labor-intensive firms because they have to pay 130% of basic salaries if employees go to work. Besides, where does it stop? Another holiday for Iglesia ni Kristo? How about for Seventh Day Adventists? Or the Aglipayans? These other religions can cry religious discrimination.
Another very bad law is the Free Tertiary Education Act. The Act subsidizes both rich and poor students alike since the subsidy is given to the SUC (State University or College) and not to the student.
However, there are excellent, if not good, laws which emanated from the 17th Congress. The hugely important law is the Rice Tariffication Act. It’s a hugely pro-poor and pro-development law. It’s also momentous since the dismantling of the National Food Authority’s legal monopoly on rice importation has been attempted by reformists for years, but never accomplished in previous congresses until now. It’s hugely pro-poor because it will lower and stabilize the price of the poor’s main staple, rice, and effectively increase their real incomes. It’s hugely pro-development because wage demands from labor will be tempered by the lower price of rice, making our companies more cost competitive. Moreover, the huge chunk of the agriculture budget going into rice in pursuit of a foolish rice self-sufficiency policy can now be channeled into higher value crops.
The other hugely important law, but in the political sphere, is the Bangsamoro Organic Law (BOL). Like the Rice Tariffication Act, the BOL has been years in the making, repeatedly foiled in its various previous versions. Finally, bucking history, the 17th Congress passed it. The BOL will give more meaningful autonomy to the Bangsamoro region and lay the foundation for peace and development in the strife-torn area. And for those who are fans of the parliamentary system, the BOL will provide a real experiment as it provides for a party-based parliamentary system in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM).
Agriculture, which is the country’s laggard sector, just got a big boost with the passage of the Agriculture Free Patent Act (RA 11231). It removes Commonwealth-era restrictions that prevent an estimated 2.5 million agricultural patents from being bankable. For the first time, corporations, not just individuals, will also be allowed to buy agricultural patents, paving the way for corporations to invest in the countryside.
Among the legislative cornucopia of the 17th Congress is pro-business legislation. One is the Ease of Doing Business Act, which aims to cut bureaucratic red tape and eliminate corrupt practices. The law mandates that processing time for transactions with government and government corporations is three working days for simple transactions, seven working days for complex transactions, and twenty working days for highly technical ones, with corresponding penalties for bureaucrats if government mandates aren’t followed.
In this spirit of cutting down on red tape is EVOSS or Energy Virtual One Stop Shop Law. Under EVOSS, prospective energy investors can get their permits through an online platform. It aims to cut down on the hassle and time needed to get permits for energy projects.
Another law which should be helpful to SMEs is the Personal Security Property Act (RA 11057). The law aims to enable SMEs to use non-real estate assets (inventory, equipment, and other personal property) as collateral for bank loans by strengthening the legal framework for secured transactions. For movable collateral, the law establishes an electronic centralized registry under the Land Registration Authority.
The Revised Corporation Code should also be a boon to SMEs. It provides for One Person Corporations. The old law required five incorporators with a minimum capital stock. It gives more flexibility for entrepreneurs, who can make sole decisions and who don’t have to rope in five friends to be incorporators and board members.
There are also a number of socially progressive legislation. A superb law that will yield high economic and social returns is the First 1,000 Day Law (RA 11148) authored by Senator Grace Poe. It seeks to provide health and nutrition services to the first 1,000 days of a child’s development. The law provides for nutrition programs for babies and their mothers up to two years of age. It aims to reduce the number of stunted (3.5 million) and malnourished children with nutrition services and health programs for babies and pregnant women.
PHILIPPINE STAR/MICHAEL VARCAS
Another huge health measure is the Universal Health Care Law. It intends to enroll every Filipino into the National Health Insurance Program. The law is ambitious and expensive (about PHP 257 billion). The government should be prudent in implementing it, lest it blow a hole in the budget. However, properly implemented, it can lead to cost-effective health care with emphasis on disease prevention and community-based health care. It can also lead to innovations if the primary implementor, Philhealth, uses various modes of PPP (Private Public Partnership) in implementing various parts of the law.
The Mental Health Care Act (RA 11036) is also another landmark health measure because, for the first time, mental illness will be recognized and integrated into the nation’s health care system.
I would also count the National ID Law as socially progressive legislation, although it also benefits the economy and strengthens peace and order and security. Too often, poor citizens cannot access banking services or social services for the lack of an ID.
However, there’s a risk that excessive social welfare spending will outpace productivity growth, causing inflation or stagnation. The government, therefore, must carefully calibrate implementation of social welfare spending relative to productivity growth.
Aside from pro-business and socially progressive legislation, the output of the 17th Congress includes pro-consumer laws. Among these are Number Portability Act, the Free Public Wifi Law, and the Estate Tax Amnesty.
The Number Portability Act, authored by Senator Win Gatchalian, will help spur competition in the telecommunications sector since mobile consumers can retain their old numbers even when switching to a new service provider. This will be a boon to the third telco as it tries to carve out market share by offering lower prices.
The Estate Tax Amnesty will help free up “dead capital” from estate property that couldn’t be sold or transferred due to the high taxes and fines under the old law.
There are two laws that will strengthen government institutions. After many years, a new Central Bank Charter was passed (RA 11211), a legacy of the late BSP Governor Nesting Espenilla who died shortly after the law was enacted. The new Charter strengthens the capital base of the Bangko Sentral to PHP 200 billion and mandates it to “pursue price stability conducive to a balanced and sustained growth of the economy.” The new law also gives it more powers over money service businesses, payment operators and other types of financial institutions. It restores BSP’s powers to issue its own debt papers.
Finally, the new SSS law similarly strengthens the Social Security System, ensuring that it remains financially sound to service its members. It also mandates compulsory coverage of overseas Filipino workers.
However, the 17th Congress hasn’t ended yet. There are still nine session days left before the current Congress adjourns sine die to pave the way for newly elected officials in the 18th Congress. It still has the time to pass the Public Service Act Amendment and the Open Access in Data Transmission Act. As I stated before, the Public Service Act Amendment, which seeks to remove foreign ownership restrictions in the strategic industries of transport and telecommunications to foster competition and facilitate technology transfer, is the most consequential piece of economic legislation since the founding of the Republic. The Senate would be remiss in its duty if it fails to pass this landmark measure.
On the other hand, the Open Access in Data Transmission Act will foster more competition and innovation in the broadband industry. The Open Access in Data Transmission Act, and not the entry of the third telco, is the real game changer to enable Filipino consumers to enjoy faster and cheaper Internet service.
It’s too bad that the impression of the Philippines abroad is all about extra-judicial killings (EJKs) and the bloody anti-drug war, thanks to our foul-mouthed President. However, there are some real positive changes — even some socially progressive legislation absent in advanced countries — going on. We can only hope that the 18th Congress, the last under President Duterte, will continue to pass legislation that will sustain economic growth with social inclusion.
Calixto V. Chikiamco is a board director of the Institute for Development and Econometric Analysis.
The good news in Philippine inflation is that the numbers are declining in the past three months of 2019. The bad news is that even such “low inflation” is actually the highest in East Asia, among the more mature economies with updated numbers. Dutertenomics should be ashamed of this.
And even in the Bangko Sentral ng Pilipinas (BSP) quarterly Business Confidence Survey, the trend is a continuing decline from 46.8 in 2015 to 34.0 in 2018. Again, Dutertenomics should be ashamed of this continuing erosion of business confidence in the country (see table).
Meanwhile, we see President Duterte doing U-turns in major policies. First, his centerpiece program drug war, the kill-kill-kill policy, has resulted in some 25,000 murders but recently he admitted that he cannot control illegal drugs in his term.
Second, the shift from integrated PPP to hybrid PPP just to favor China contractors and financing — the need for more taxes to pay for more loans when many infrastructure projects can be financed entirely by private contractors under integrated PPP. Among the casualties of this shift is the delayed construction of Kaliwa Dam and additional 600 million liters per day for Metro Manila.
Third, his avowed fight against corruption is contradicted by the release from jail of two former senators linked to plunder, Sen. Bong Revilla and Jinggoy Estrada, who are each seeking a fresh term under the Hugpong/Duterte slate.
And fourth, his economic team’s avowed promise of economic stability is contradicted by deterioration in macro fundamentals. GDP growth is decelerating, 6.9% in 2016, 6.7% in 2017, and 6.3% in 2018. Inflation rate worsened ever since TRAIN law was implemented in 2018 with its high oil-coal tax hikes among other tax hikes, and business confidence index continues to decline.
The Duterte government’s economic management is poor while its political bragging is high. It has a chance to reverse this by at least targeting a 1-2% inflation rate this midterm election year via suspension of oil tax hikes part 2, or a tax cut somewhere. Instead, it continued its economic and political arrogance by expanding the spend-spend-spend, tax-tax-tax, borrow-borrow-borrow mantra.
I hope that voters will take note of these and punish the Duterte senatorial lineup, as well as their congressional and local government candidates.
Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers
My main message in “The Decline of Political Parties” (BusinessWorld, 1 April 2019) is that path dependence can explain how Philippine political parties have been emasculated. That is, our colonial history has determined the path of our political parties, and it will be difficult to reverse this.
The political parties arising from the course of our history are bereft of an ideology and a long-term program, are dependent on patronage and particularistic interests, and are driven by personalistic ambitions. The question then is whether these basic problems can be addressed through reforms by legislation.
The reform to strengthen political parties has been on the agenda since the fall of the Marcos dictatorship and the restoration of nominal liberal democracy. As far back as the 12th Congress (2001-04), we have seen bills filed in Congress regarding the reform of political parties.
The volume edited by Paul Hutchcroft titled Strong Patronage, Weak Parties: The Case for Electoral System Redesign in the Philippines (Anvil Publishing, 2019) tackles the different issues revolving around electoral systems, particularly political parties. One chapter, written by Ramon C. Casiple, is devoted to how legislation (the political party development bill) can strengthen political parties.
Casiple summarizes the main features of bills on strengthening political parties that have been filed since the 12th Congress, namely:
• Penalizing turncoatism (defecting from one party to another).
• Regulating campaign finance and expenditures.
• Providing state subsidy to accredited political parties.
It is telling that the so-called traditional politicians (or trapos) — those who prosper through patronage and the pork barrel and who eschew program and ideology — are among those who have filed bills on political party development. That suggests their interests will not be harmed by the reform.
Of course, the devil is in the details of the bills. And despite bi-partisan or multi-partisan support for the different yet similar bills, substantial legislation has yet to happen.
But even assuming that the reforms above will eventually happen, we ask: Will these reforms really the transform the political parties? Will these reforms really lead parties to promote ideology and coherent programs as well as reject personality-oriented politics, patronage, and elite capture?
That the trapos can go along with and even sponsor the reforms suggests that they can game the rules.
Even a strict rule on turncoatism can easily be gamed by forming a coalition with whoever is in power. Note, for example, in the current setup that the majorities in the Senate and the House of Representatives are made up of opportunistic coalitions. Although it is most desirable for a politician to be part of the party in power, a constraint on being able to shift to the dominant party will not alter the behavior of the politician to remain part of the majority through other means in order to have access to power and resources. Incidentally, only in the Philippines can one witness a minority in the House of Representatives being loyal to the leadership of the majority.
The regulation of campaign finances and expenditures is most difficult to enforce. Notwithstanding transparency measures, an investigator will have a hard time identifying and monitoring the source of financing, without inside information, when resources used by politicians take the following forms: legitimate government projects; veiled and layered financing from vested interests; and worse, resources from illegal economic activities like the narcotic trade, gunrunning, and jueteng.
The reforms then must go beyond those directly related to electoral systems and must include measures that are hard to pass such as the lifting of the bank secrecy law. And despite an Executive Order on freedom of information (FoI), its implementation is hampered by the lack of the culture of transparency in the bureaucracy. In addition, the bureaucracy uses other legal obstructions to withhold information (like a restrictive interpretation of the Data Privacy Act).
State subsidy for political parties is good on paper, but its unintended consequence can lead to further strengthening the already dominant political parties. The parties of trapos already have access to other bigger sources of financing, including those that are difficult to track. Further, in a situation where institutions are weak, such state subsidy will be a source of corruption.
This is not to say that the reforms on political development do not have merit. Rather, they are insufficient, especially when the old type of electoral politics is deeply entrenched. Reforms beyond electoral processes are necessary.
Meantime, the few small and floundering political parties that are driven by principles and ideology have to reinvent themselves. They have to find novel ways to break into the system, despite the rules being stacked against them.
Filomeno S. Sta. Ana III coordinates the Action for Economic Reforms.
A colonoscopy cum endoscopy at a private hospital cost a total of P67,500: P5,000 for the ultrasound, P25,000 for the hospital procedures, P25,000 for the doctor and P12,500 for the anesthesiologist. The self-employed young professional with no special health insurance (only PhilHealth) could hardly afford this. PhilHealth stepped in for P5,400 deductible from the patient’s bill, 8% of total, but that did not go to her. The 30% of P5,400 is for refund to the doctor of Professional Fees (PF) over what was billed to the patient and 70% is refunded to the hospital on top of what was charged to the patient. For surgical cases, it would be 40% for PF and 60% for hospital costs. Crazy, but it feels like PhilHealth is for doctors and hospitals, and not for patients, because patients don’t see, feel and touch the PhilHealth “refund.” It is like a flat “commission” paid for services rendered by doctors and hospitals — while they would still have the freedom to charge higher than the PhilHealth maximum base rates per the immutable chart of coverable diseases and procedures. Since September 2011, PhilHealth started implementing its policy of paying fixed rates or fixed amounts to accredited hospitals and clinics for 11 medical cases and 11 surgical cases charted under its reimbursement scheme called Case Rates Payment (workingpinoy.com June 2, 2014). Refunds have been cut down drastically from 2003, since deductibles (purportedly for the patient, but actually a “bonus” to doctors and hospitals) have been whittled down. Poor patient!
Wonder how the Philippine Health Insurance Corp. (PhilHealth) will now handle its expanded responsibilities and accountabilities, with the signing into law of the Universal Health Care (UHC) Act, Republic Act No 11223 by President Rodrigo Duterte on February 20, and now running its 180 days (until August) to complete the Implementing Rules and Regulations (IRR)? Senators Sonny Angara and JV Ejercito co-authored the UHC, which grants every citizen health coverage that will supposedly lower out-of-pocket health expenses (philhealth.gov.ph Feb 4, 2019).
The UHC I.D./health card to be issued to all (tantamount to a national I.D.?) will be managed by the new Philippine Health Security Corp. (PHSC), renamed from PhilHealth. The Point-of-Service Program will continue, to enable patients to avail of health care facilities, provided they are confined in government facilities. All are also entitled to an “essential health benefit package,” which includes primary care, medicines, diagnostic, and laboratory tests. It also includes preventive, curative, and rehabilitative services.
The PHSC will be creating supplementary coverage by health maintenance organizations (HMOs) and private health insurance, as well as providing network-based licensing, contracting, and accreditation of facilities (philhealth.gov.ph Feb 27, 2019).
Dr. Roy Ferrer, acting PhilHealth president, revealed that over 100 million Filipinos are currently covered by PhilHealth. With UHC, the remaining six million of the population — contributors to PhilHealth: employed, self-employed or professionals; and non-contributors: unemployed, jobless, retired, will soon be in the National Health Insurance Program, with immediate eligibility to claim the benefits when needed (Ibid.). Contributors — or income earners — will have to pay for their premiums while the government will shoulder the contributions of non-contributors. Funds for the subsidy will be included in the annual General Appropriations Act: from the Philippine Amusement and Gaming Corporation (PAGCOR) — 50% of national government’s share; from the Philippine Charity Sweepstakes Office (PCSO) — 40% of its charity fund, net of documentary stamp tax payments, and mandatory PCSO contributions. Health Secretary Francisco Duque also previously said that increased sin taxes from cigarettes will also be a major source of funding for the policy (CNN Philippines, October 10, 2018).
Many doctors seem to have misgivings about the UHC law. While first nobly affirming their Hippocratic Oath of “not ever turning away, and healing all those who need help,” one well-known gynecologist simply said doctors will just have to live with what the government wants to give the people. Doctors and hospitals have managed well enough under the old PhilHealth scheme, and will adjust to UHC. Indeed, public hospitals and doctors will be swamped with those patients availing of free services, but private hospitals and doctors will maintain their snob appeal and their patients will accede to regular billings while availing of maximum PhilHealth deductibles that go back to the hospitals and doctors anyway — no problem.
Excuse me, there is a perennial problem, one senior pulmonologist with a big private hospital said: the receivables of doctors and hospitals from insurance companies, Health Maintenance Organizations (HMOs) and PhilHealth itself. While the Bureau of Internal Revenue (BIR) has zealously tax-mapped hospitals and doctors’ clinics, and unreceipted transactions and discounted or “donated” (free) services (to relatives and friends) are tax violations, unpaid/unrefunded claims by patients using these insurances must already be reported part of taxable income by the doctors and hospitals. Even the private insurers will now have to parallel coverage with the coverage of UHC, and claims will magnify, as will doctors’ and hospitals’ receivables. There is even the added complication of HMOs not agreeing with doctors’ diagnoses and plan of action (e.g. surgery or no surgery; when, how) as these will impact claims.
Note that the Private Hospitals Association of the Philippine Inc. (PHAPi) has a long-running dispute with PhilHealth on around PHP7 billion to PhP9 billion in supposed unpaid claims owed to about 15 of their member hospitals (pna.gov.ph May 25, 2018). PhilHealth denies this, but PHAPi has warned that its members may halt healthcare services to members of PhilHealth by the accredited hospitals that cannot survive or continue operation due to non-payment of mounting claims from PhilHealth (Ibid.). PhilHealth has at times countered withdrawal of accreditation.
An outspoken orthopedic doctor decries alleged anomalies of hospitals overcharging for services and room charges, and some drug companies “controlling” doctors and hospitals and pushing for prescriptions and endorsements for supposed commissions. Under the UHC law, companies that offer generic drugs, medical check-ups, diagnostic tests, and laboratory services will even be happier with their increased role as supplier for the increased demand from expanded coverage and naturally increased needs and consequent availments.
PhilHealth will be the national purchaser of medicines under the UHC program. This can lower the cost of medicines as these will be bought in bulk (philstar.com March 4, 2019). Assuming there will be no-profit transfer to public hospitals and government health facilities, the amount of purchase will give much power and influence to Philhealth/PHSC, and maybe too much temptation to corruption of weaker-principled functionaries.
Dr. Ferrer says PhilHealth is “raring to go” for the UHB, bragging of P11.6-B in net income in 2018, from premium income of P132.5 billion, 23% higher than that of 2017, from which PhilHealth paid a total amount of P121 billion in health care benefits (philhealth.gov.ph Feb 27, 2019). But Department of Health (DoH) and lawmakers estimate that P257 billion will be needed on the first year of implementation of UHB and another P280 billion in the second year. (The Philippine Star Feb 12, 2019). With the magnified privileges (outpatient lab, rehab, maintenance, even preventive medicine) and total population coverage, the financials will not look as nice for PhilHealth/PHSC. And to count on the multiplier of additional sin taxes would be foolhardy. Even the DoH says that sin taxes have to be increased three-fold to fill up what would be a budgetary deficit to implementing UHC during the first two years. (Philippine Star Feb. 12, 2019). Has government even looked at precariously hanging assumptions about the sustainability of grand-scale universal care at this economically tenuous time? Ah, but elections are coming in May.
Why have not the campaigning politicians thought of declaring to shun contentious pork barrel insertions in the stalemated national budget (at least P75 billion, according to Sen. Panfilo Lacson) to at least help jump-start this ambitious, and laudably more pro-poor assist to uplifting the health opportunities of Filipinos?
Amelia H. C. Ylagan is a Doctor of Business Administration from the University of the Philippines.
IT’S NOT just wakes and weddings but also open seminars on leadership, corporate governance, and team-building sessions involving groups of companies as well as chance meetings at the theater or restaurant where one needs to introduce himself, sometimes to strangers. (Let’s go around the room and introduce ourselves.)
Why is there this need to get biographical details, even when the possibility of working together, or even meeting again is so remote? Who cares about life stories except perhaps employers interviewing candidates for a job — what value can you bring to our market cap?
When asked to introduce yourself in a social setting, there is no need to deliver a mini-speech on your life’s dreams and aspirations or offer up a personal mission statement — I want to leave footprints in the sands of other people’s beaches.
Do we perhaps still need a calling card to give out? This little data base from the analog days of paper provides name, position, and the company address and contact details (including e-mail and mobile). This info can also be transferred on the phone via Bluetooth? But what if you send somebody else’s contact details? (Who is Sweetie Pie?)
Introducing yourself can be awkward if: a) you have already retired (or been fired) from a high-profile position which some think you still hold; b) you are an uninvited guest, tagging along for somebody else’s high school reunion; or c) you have a selfie video making the rounds — how did they get that?
No stress should be attached to the simple social task of self-introduction. It’s not as if the extracted information will later be fished out later to embarrass you. When introducing yourself to a stranger, all that’s needed are a few biographical details to guide her on what she can talk about with you.
We are too used to defining ourselves by our work or how we make money. (I give out brochures at the mall for massage chairs.) So, a person without a proper occupation can be at a loss on how to introduce himself. It’s best to pick a hobby, preferably not a common one, like art auctions or philately (which is not a religion).
If small talk is all that is required, it is best to stick to general subjects like air pollution, working from home, and clichés about the gadget culture (nobody converses anymore, they’re just too absorbed with their gadgets). Other topics with partisan overtones say, senatorial picks, fake news, and religion, should be avoided as these invite ad-hominem attacks on your prejudices — are you a defrocked priest?
There is too the harmless probing of common backgrounds, utilizing the theory of “six degrees of separation” tracing social connections, like friends of friends, school ties, cousins of cousins, and colleagues from different companies in past lives. This bit of curiosity game at a wedding (are you with the bride’s party?) or wake (did you know the deceased well?) leads to the inevitable Eureka moment. After five minutes of questions and answers (punctuated by shrieks of delight) a preordained point is reached at last: “What a small world.” This bit of social digging distracts from an undue preoccupation with careers and status issues. It also takes up time which is there to be wasted — oh is it dinner already?
Odd relationships like accompanying partners not covered by routine labels like spouses or caregivers (she gives me foot massages) require their own diversionary tactics to avoid biographical details, including arriving separately or mixing with different conversation groups. Here, avoidance of intros is the chosen path. Partners of this sort leave through different exits.
There is no obligation to give any biographical details at all, when in a familiar social setting among colleagues, former classmates, and family. Those groups already know of any recent embarrassing situations you find yourself in, like retiring or losing a job after some high-profile investigations, even as you await the resolution of a TRO. This grapevine is on alert for changes in social status. (His shirts now need pressing, and have missing buttons.)
So, perhaps the best way to introduce yourself is like a prisoner of war, but giving only a nickname (Hi, I’m Dax) instead of rank and serial number. Then, it’s just a matter of avoiding personal probes altogether, or limiting these to irrelevant questions — are you also allergic to soft shell crabs?
THE Metropolitan Waterworks and Sewerage System (MWSS) expects to meet before Easter with the proponents of a project to tap Wawa Dam in Rizal to help clear legal hurdles for the potential water source.
“They will present to us on the 16th [of April] ’yung kanilang (their) technical working group product,” MWSS Administrator Reynaldo V. Velasco told reporters last week.
The presentation follows the signing in March of a memorandum of understanding between the Ayala Group’s Manila Water Co., Inc. and Enrique K. Razon Jr.’s Prime Metroline Infrastructure Holdings, Inc. (Prime Infra) to form a technical team that will conduct due diligence on the 500-million-liters-per-day (MLD) Wawa bulk water project.
Mr. Velasco said the proponents will then be asked to present the project to the MWSS board, whose approval will clear the plan’s submission to the National Economic and Development Authority (NEDA) for approval.
The Wawa project is among the MWSS medium-term water sources for completion in 2025. A component of the project, the 80-MLD Calawis-Wawa Dam being undertaken by Manila Water, is targeted to be finished by 2021.
In 2017, Mr. Razon proposed to invest and assume the controlling stake in the project through an 82% share ownership once he was convinced of its legal, commercial and financial viability.
In turn, the Violago group, the original proponent, will contribute the Wawa water permit, application for water volume increase, and the water project in exchange for an 18% stake in it. The antitrust regulator cleared the partnership on Dec. 19, 2017.
Manila Water became the possible third partner in the project, which the groups describe as strategically located to serve the expansion areas of the east zone concessionaire.
The partners plan to develop a water supply facility at the Wawa catchment area traversing the municipality of Rodriguez and the city of Antipolo, both in the province of Rizal.
“I talked to Mr. Razon himself. I made it very clear (to him), ‘you cannot get that one (removed), no deal,’” Mr. Velasco said, referring to a restraining order sought by the Violagos and issued by the Court of Appeals that blocked the Calawis-Wawa Dam project.
“If you cannot get Violago to remove that case, it’s not really a case, restraining order lang (only), [then no deal],” he said.
“By [April] 16thdapat tanggal na ’yan (the restraining order must be removed),” he said.
The crucial meeting comes as the agency is hard-pressed to come up with new water sources to meet Metro Manila’s rising demand.
Mr. Velasco has yet to add Wawa Dam to his short-term projects, which are those classified as capable of “being fast-tracked, doable and implementable.”
These projects are the 150 million liters per day (MLD) Putatan 2 water treatment plant, which is set for launching on Monday; the 100-MLD Cardona water treatment plant, which is to be fully completed this year; the 188-MLD Sumag River diversion project, due by 2020; the 50-MLD Rizal wellfield by 2020; the 80-MLD Calawis-Wawa Dam by 2021; the 100-MLD Putatan 3 by 2022; the 250-MLD lower Ipo Dam by 2023; and the 600-MLD Kaliwa Dam, also by 2023.
“Let me emphasize that it is only under the Duterte administration that has put premium on the need to construct new water supply sources starting with the 600 MLD Kaliwa Dam since Angat was last built in 1967 that continue to supply 4,000 MLD of water to Metro Manila and adjoining provinces,” Mr. Velasco said.
He said the present MWSS Board of Trustees and management has been working to ensure water security during the Duterte administration by providing at least 1,518 MLD by 2022.
For the medium-term water source projects, or the period from 2023 to 2027, Mr. Velasco enumerated the following: the 420-MLD Wawa Dam; the 250-MLD Laguna east bay water treatment plant; the 350-MLD Bayabas Dam; the 550-MLD Angat-Norzagaray phase 2; the 750-MLD Sierra Madre project; and the 1,800-MLD Kanan River phase 1 project. — Victor V. Saulon
THE feasibility study for the Quezon-Bicol Expressway (QBEx) is now expected to be submitted in the third quarter to the National Economic and Development Authority (NEDA).
The Department of Public Works and Highways (DPWH) said the delay is due to the additional work needed in regard to finalizing the road’s alignment.
Secretary Mark A. Villar said on Wednesday: “It’s going to be done third quarter of this year… Paglabas ng FS, isa-submit na namin kaagad sa NEDA (After the feasibility study, we’ll submit it to NEDA right away),” he told reporters on Wednesday after inspecting the C5 South Link Project in Taguig City.
“The expressway is about 220 kilometers. It’s a big project… It’s very complicated. There will be bridges too. It’s really long,” he added.
In February, DPWH Public-Private Partnership (PPP) Director Alex G. Bote said the agency is hoping to submit the QBEx feasibility study to NEDA in March. At the time, the road was expected to run between Lucena City and San Fernando, Camarines Sur, which is near Naga.
In a text message on Sunday, Mr. Bote said the alignment of QBEx may still change until the detailed engineering design is completed, which is the next step after NEDA evaluates the plans.
“Available alignment (conceptual) for QBEx still has a chance of moving/changing, kasi magkaron lang talaga yan ng finality ‘pag may detailed engineering design na [because it will only have finality once there’s a detailed engineering design]. Now, FS for QBEx is ongoing,” he said.
Once the DPWH finishes the feasibility study, the NEDA will determine the cost of the project and its mode of financing. Mr. Bote earlier said it may take a public-private partnership scheme, financing from official development assistance (ODA) or the general appropriations act (GAA), or a mix of any of the three modes. — Denise A. Valdez
