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Policy analysts buck DoE call to allow automatic price increases within range

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By John Victor D. Ordoñez, Reporter

PHILIPPINE lawmakers should expand the Energy Regulatory Commission’s (ERC) pool of technical staff to ease the administrative workload in approving power price petitions, while tightening regulatory frameworks in the approval process to ensure fair pricing, analysts said at the weekend.

“The mandate to exercise regulatory power to serve the public interest is more important than streamlining the approval process and reduce the quasi-judicial burden of the ERC,” Terry L. Ridon, a public investment analyst and convenor of think tank InfraWatch PH, said in a Facebook Messenger chat.

“The remedy to resolve these administrative concerns is to expand the technical staffing of the commission to ensure the time-sensitive approval of various petitions before it,” he added.

Energy Undersecretary Sharon S. Garin last week urged senators to amend the ERC charter to allow price increases without regulatory approval as long as these fall within a set benchmark or bracket.

This would allow the ERC to do away with the cumbersome approval process that power distributors have complained about, she told a Senate energy committee hearing that is looking at changes to the 23-year-old Electric Power Industry Reform Act (EPIRA).

The Department of Energy (DoE) is finalizing proposals for penalties the ERC can impose in cases of economic sabotage in the power generation sector, Ms. Garin said earlier.

In his third address to Congress, President Ferdinand R. Marcos, Jr. sought a review of EPIRA to address issues hounding the energy sector, particularly high energy prices.

“The electricity sector is a natural monopoly that demands stringent regulatory oversight because it is so critical and affects every aspect of economic and domestic life,” Jose Enrique “Sonny” A. Africa, executive director at think tank IBON Foundation, said in a Viber message.

“Streamlining processes and removing regulatory checks is just empowering power firms to adjust prices more conveniently and according to their profit motive,” he added.

He added that unchecked price increases would make life difficult for lower-income households and small businesses.

Senator Sherwin T. Gatchalian earlier said Congress should empower the ERC to fast-track the approval of power supply deals to fix constant blackouts in the country.

Energy Undersecretary Rowena Cristina L. Guevarra told senators in May that 4,000 megawatts of power might be added to the country’s power generation capacity by the end of the year.

She said some power plants that eye setting up shop this year are falling behind in the application process but are ready to start operations.

Analysts earlier said lawmakers should limit cross-ownership and address privatization concerns under EPIRA to boost competition.

Think tank Center for Energy Research and Policy said cited the need to reform the power procurement process and increase investment incentives to boost competition.

It has also recommended enhancing the regulatory powers of the Energy department and the ERC.

EPIRA restructured the electric power industry by privatizing the generation, transmission, distribution and supply of power in 2001.

Under Section 5 of the law, cross-ownership — the concentration of ownership in two or more related businesses — is only outlawed between a transmission company and any company in generation and distribution.

“Regulatory bodies like the ERC are needed as counterweights to market forces and checks on regulatory capture, ensuring that the electricity sector operates transparently, equitably and for the broader public welfare,” Mr. Africa said.

House considers fewer tax cuts under capital market reform measure

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THE House of Representatives ways and means committee wants to trim the revenue loss from a capital market reform bill it approved in March to P18 billion from more than P30 billion yearly by limiting the tax cuts to stock transactions.

Albay Rep. Jose Ma. Clemente S. Salceda, who heads the panel, said they are open to amending the House-proposed Capital Markets Efficiency Promotion Act by only lowering the stock tax to 0.1% from 0.6%.

They might also keep the proposed 10% tax on dividend income when they meet with their Senate counterparts for a bicameral conference committee, he told BusinessWorld in a Viber message at the weekend.

“We are considering a leaner version, focused solely on capital market provisions,” the congressman said. “The revenue impact will be much lower, at about P12 billion to P18 billion per year.”

“We are already providing inputs to the Senate committee on ways and means so that we have as little disagreement as possible when we meet as a bicameral committee. The focus will be on the stock transaction taxes and dividends,” he added.

The House in March approved on third and final reading House Bill No. 9277, a priority measure that seeks to reform the capital markets by reducing taxes on stock transactions. The bill has been transmitted to the Senate, where it is being heard by the ways and means committee.

The Department of Finance this month told the Senate panel that the House version could lead to foregone revenue worth P140 billion in the next four years.

The House bill also halved the tax on lotto ticket sales and winnings to 10% and exempted insurance policies worth less than P100,000 from documentary stamp tax, while levying a P200 tax on policies worth more than P1 million.

The government could lose up to P38 billion from lowering taxes on lottery winnings and ticket sales and P71.62 billion from reducing the tax on insurance policies in the next four years, according to a Finance department presentation.

Mr. Salceda said he is also open to including excise taxes on pickup trucks, which could net the government about P30.1 billion up to 2028.

“I am also very amenable to neutralizing the revenue impact through the excise tax on pickup trucks. It was a policy misstep and it’s time to correct that tax exemption,” he added.

The House committee is also working with its Senate counterpart to include a provision providing tax incentives to companies with a “corporate pension plan.” “We are also hammering out a provision that will establish a tax-free, incentivized corporate pension scheme.”

“This is on top of the Social Security System,” he said, adding that the move would boost the capital markets and create wealth for the working class.

The government could offset foregone revenue through increased transactions in the domestic capital markets, which could be enough to compensate for the losses, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.

The state should look at improving its tax administration and collection to help minimize revenue losses from the reform bill, he added.

The government should instead streamline investments in Philippine industries instead of cutting taxes on stock transactions if it wants to boost capital markets, Jose Enrique “Sonny” A. Africa, executive director at think tank IBON Foundation, said in a Viber message.

“There’s a problem with the notion that cutting taxes on stock transactions is the key to boosting capital markets and investment competitiveness,” he said.

“It will just further incentivize financial speculation over productive investment and, correspondingly, do little to address the real economic problems of poverty, hunger, joblessness and inequality in the country,” he added.

He also said providing tax incentives to companies with corporate pension plans would only benefit about 5% of the Philippine workforce, adding that the state should look at hiking wages for the working class.

“Tax incentives for corporate pension plans will ultimately benefit corporations more than workers.”

“If the government is serious about pension reforms, it should strengthen public pension systems to be more universal and with larger benefits, giving decent retirement incomes to all workers,” Mr. Africa said. “It should also improve social services, especially healthcare, to give retirees more security in their old age.” — Kenneth Christiane L. Basilio

Analysts: Duterte probe must be shielded from politics

PHILIPPINE STAR/ MIGUEL DE GUZMAN

By Kyle Aristophere T. Atienza, Reporter

A PROPOSAL to create an independent body that will investigate ex-President Rodrigo R. Duterte’s war on drugs should be pursued via legislation to insulate it from politics, according to political analyst.

Doing so would also avoid a potential conflict of interest since several agencies under the Executive branch had participated in the campaign, Arjan P. Aguirre, who teaches political science at the Ateneo de Manila University, said in a Facebook messenger chat.

“We cannot expect an ad hoc committee to do its job just like that if it was just an executive creation,” he said. “We need to have a more solid and credible source of that power to compel government offices and institutions to comply especially in producing data and information to help us know who did what and if public funds were used for this.”

House Minority Leader Marcelino Libanan at the weekend urged President Ferdinand R. Marcos, Jr. to form an independent fact-finding commission that will investigate killings under the Duterte government’s war on drugs.

He said it should be patterned after the Agrava fact-finding board, which was formed to investigate the 1983 assassination of former Senator Benigno “Ninoy” Aquino, Jr. at the Manila airport.

If the government is serious in holding perpetrators to account, “it should legislate the special body and allot funding for it,” Mr. Aguirre said. “Make it functional regardless of who is in power.”

Mr. Aguirre noted that many agencies had been involved in Mr. Duterte’s drug war, which is being investigated by a House quad committee. These include the police, Philippine Drug Enforcement Agency and even the Justice department, he pointed out.

“I hope people are seeing the problem that many of the involved offices and agencies are connected to the government,” he said. Creating an ad hoc body through an executive order could be prone to the influence of the administration and its allies, he added.

Anthony Lawrence Borja, a political science professor at De La Salle University, said the Marcos government is likely to pursue more domestic measures amid Filipino sentiment against foreign interference.

“Support for Duterte’s drug war was based, not only on some notion of social cleansing and intolerance but also on sentiments against foreign interference especially from organizations perceived as pro-American,” he said via Messenger chat.

“Hence, keeping procedures domestic will allow the administration to sustain or even gain support from those who, though disillusioned with Duterte, remain averse to foreign intervention.” he added.

The National Union of Peoples’ Lawyers has urged Mr. Marcos to submit the findings of the House quad committee probing the drug war to the International Criminal Court (ICC).

Hansley A. Juliano, who teaches political science at the Ateneo said, noted that if the government were serious about giving victims of the drug war justice, “the ICC process needs to be prioritized since it is the appropriate forum with the stakeholders, especially the victims.”

“Whichever the administration chooses already indicates what their genuine priorities are.”

SC ruling on free speech ‘defangs’ public officials vs critics — NUPL

By Chloe Mari A. Hufana, Reporter

THE Supreme Court (SC) ruling that statements against public officials are not inherently defamatory or slanderous could boost transparency and protect frequently harassed advocacy groups in the Philippines, a lawyers group leader said.

“It may lead to increased transparency, because now, defamation case[s] as a weapon of government officials [have] been defanged, and critics cannot be threatened with legal cases,” National Union of Peoples’ Lawyers (NUPL) President Ephraim B. Cortez told BusinessWorld in a Viber message over the weekend.

Mr. Cortez added that the ruling would offer added protection to whistleblowers and investigative journalists, who, despite constitutional safeguards, often face legal harassment.

In the ruling written by Senior Associate Justice Marvic M.V.F. Leonen publicized last week, the High Court’s Second Division said that actual malice must be proven to count remarks against public officials as defamatory or slanderous, citing Article 358 of the Revised Penal Code.

The Code provided that there is oral defamation or slander when (1) there is an allegation of a crime, fault, or flaw; (2) made orally; (3) publicly; (4) maliciously; (5) towards a person, alive or dead; and (6) such allegation tends to cause dishonor on the person defamed.

“This decision recognizes that critics of the government and that of government officials should be afforded protection and not subjected to harassment, including legal harassment, like the filing of defamation cases,” Mr. Cortez added, noting this ruling should have also included libel.

“This decision recognizes the constitutional protection to free speech, including the right of redress of grievances,” he added, noting that this is a reiteration of previous SC rulings where it upheld that government officials should not be “onion skinned.”

Mr. Leonen noted in the decision that “being ‘sensitive’ has no place in the line of public service, especially when allowing otherwise has the potential to create a chilling effect on the public.”

“Recognizing that free speech empowers the citizens in exacting accountability from public officers, a conviction for defamation involving statements related to their discharge of official duties entails proof that they were made with actual malice,” the SC ruling also read.

Alleged land grabbing probe sought

A CONGRESSMAN on Sunday is calling for a congressional investigation over allegations of land grabbing by a mining company on the ancestral lands of the indigenous peoples (IP) in Agusan del Sur, Mindanao, located southeast of the Philippine capital.

Party-list Rep. Erwin T. Tulfo said he will file a House of Representatives resolution for the inquiry on Monday, which could help bolster mining and IP laws amid the need to protect “underprivileged” minority groups.

He said he received a complaint from members of the Rodrigo clan, natives of the Manobo Tribe residing in Bunawan municipality in Agusan del Sur province.

“Their complaint is that the said mining company has taken their land, and they haven’t received any compensation for their community,” Mr. Tulfo said in a statement.

The complaint alleged that a mining firm denied the tribe their “rights” over their lands and royalty shares from the company’s profits over the land, the draft resolution stated.

The mining firm did not immediately reply to an e-mail and Facebook message seeking comment. — Kenneth Christiane L. Basilio

P150 wage hike bill pushed

PHILIPPINE STAR/BOY SANTOS

NAGKAISA chairman and senatorial candidate Jose “Sonny” G. Matula on Sunday renewed his call for Congress to pass an across-the-board P150 legislated wage hike.

“This election is a pivotal moment for labor representation in the Senate as well as in the House,” he said in a statement. “It is essential that while we investigate past abuses, we also advance legislation that will safeguard workers’ rights and improve their lives.”

Mr. Matula also pushed the state to double its efforts to address the plight of contract-based workers.

Other labor leaders vying for Senate spots are Kilusang Mayo Uno Secretary General Jerome Adonis, National confederation of Labor President Ernesto Arellano, and Bukluran ng Manggagawang Pilipino chairman Leodegario Q. De Guzman

In February, the Senate passed on third and final reading a P100 across-the-board increase for private-sector workers. The House of Representatives has yet to pass a counterpart bill.

The Regional Tripartite Wages and Productivity Board in July approved a P35 minimum wage hike for workers in Metro Manila. This brought the minimum daily pay for nonagricultural workers in the region to P645.

“We (candidates from the labor sector) are also challenging political dynasties in Congress and would like to offer better alternatives to the electorate,” Mr. Matula said. — John Victor D. Ordoñez

Expanded PhilHealth benefits eyed

PHILIPPINE STAR/MICHAEL VARCAS

A CONGRESSMAN on Sunday pushed for a measure that would expand state-run Philippine Health Insurance Corp.’s (PhilHealth) coverage by including mental healthcare benefits amid a mental health crisis.

Filed by Las Pinas Rep. Camille A. Villar in September, House Bill (HB) No. 10934 would expand PhilHealth’s coverage by including psychiatric, neurological, and emergency services for mental health illnesses.

“In order to address this seeming mental health crisis among our population, this bill shall expand the coverage of the benefit package to include all mental health disorders and regardless of age group,” she said in a statement.

She said the bill will help Filipinos get the mental health treatment they need without financially burdening them.

Citing data from the Mental Health Strategic Plan 2019-2023, the Philippine Council for Mental Health reported that about 3.3% or about 3.3 million Filipinos have depression. The country’s suicide mortality rate is 3.2 per 100,000 Filipinos, it added. — Kenneth Christiane L. Basilio

BENECO seeks cheaper power cost

BENECO FB PAGE

BAGUIO CITY — Power cooperative Benguet Electric Cooperative (BENECO), sole power distributor servicing Baguio and Benguet, joined the Luzon Electric Cooperatives Aggregation (LECA) hoping for cheaper generation rates to pass on to its member-consumers for the next 15 years.

BENECO’s Emergency Power Supply Agreement (EPSA) with its current supplier, Limay Power, Inc. (LPI), a subsidiary of San Miguel Corp., will end by the first week of March 2025.

The EPSA was procured following the expiration of BENECO’s 20-year power supply agreement with TEAM Energy (formerly Mirant) on March 13, 2024.

BENECO, it said, is determined to secure a longer power supply agreement through the aggregation before the EPSA expires.

The aggregation has joined the demand of 18 electric cooperatives (ECs) to be able to secure reasonable generation rates. The ECs are Albay Electric Cooperative, Inc., BENECO, Camarines Electric Cooperative, Inc. I and II, Central Pangasinan Electric Cooperative, Inc., Ilocos Norte Electric Cooperative, Inc., Ilocos Sur Electric Cooperative, Inc., Isabela Electric Cooperative, Inc. I and II, Kalinga Electric Cooperative, Inc., Mountain Province Electric Cooperative, Inc., Nueva Ecija Electric Cooperative, Inc., Pangasinan Electric Cooperative, Inc. III, Pampanga Electric Cooperative, Inc. I, Pampanga Electric Service Coop, Sorsogon Electric Cooperative, Inc. I, Tarlac Electric Cooperative, Inc. I and II.

The cooperatives have a total aggregated demand of 601 megawatts. — Artemio A. Dumlao

Pangasinan town mayor suspended

BAGUIO CITY — The Sangguniang Panlalawigan (SP) of Pangasinan suspended Urdaneta City Mayor Julio F. Parayno III for a year.

Under Provincial Resolution numbered 958-2024 passed this week, SP members unanimously adopted and approved an earlier ruling of the SP Committee on Good Government and Accountability of Public Officers, Justice and Human Rights penalizing Mr. Parayno III for violating two provisions of the Republic Act (RA) 11032, the Ease of Doing Business and Efficient Government Service Delivery Act of 2018.

The SP though ruled that the mayor was not guilty of violating the Local Government Code of 1991, under RA 7160.

This stemmed from his refusal to issue a business permit to REVM Tiposu Poultry Farm, Inc. in 2021, which the Anti-Red Tape Authority (ARTA) said is in violation of RA 11032. This prompted the Pangasinan SP Committee on Good Government and Accountability to endorse his 90-day preventive suspension on August 2024, approved by Governor Ramon V. Juico III on August 8, 2024.

Mr. Parayno III, however, said there is no such thing as a year suspension (on him), “in fact he assumed already his post last Thursday” after serving his earlier preventive suspension.

Just last September, he was also embroiled in another controversy after a videographer of the Pangasinan Information and Media Relations Office (PIMRO) filed a case for slapping him. — Artemio A. Dumlao

Toyota Financial Services PHL wins tax appeal vs Davao

THE Court of Tax Appeals (CTA) overturned a lower court’s ruling holding Toyota Financial Services Philippines Corp. liable for over P4 million in alleged deficiency of local business taxes, fees, and charges assessed by Davao City from 2009 to 2018.

“While [Toyota Financial] has been found to have been doing business in Davao City, the Court, nevertheless, finds that it should not be made to pay the assessed taxes against it, Davao City not being the situs of the taxes payable,” the 10-page ruling of the tax court’s Second Division read.

The ruling penned by Associate Justice Maria Rowena Modesto-San Pedro determined that the firm’s activities prior to 2017 were not “doing business” in the legal sense as the company only had a “lending desk” in the city, which only accepted loan applications while the processing and approval occurred at the company’s office in Makati City.

Under both the Local Government Code and Davao’s Revenue Code, the location of business taxes should be where the sales are made and recorded.

The tribunal added that loan application acceptance is not tantamount to a completed business transaction, thus, Davao City had no authority to assess taxes for years before 2017. — Chloe Mari A. Hufana

2 Moro fronts join 6th ID’s anniversary celebration

COTABATO CITY — Mindanao’s largest Army unit will be celebrating its 37th founding anniversary with two Moro secessionist fronts that are now its partners in peace and development projects.

The activities related to the 37th founding anniversary of the 6th Infantry Division (ID)  started last week, initially capped off with a shooting competition among personnel of its units and a gathering of retired soldiers who were provided then with medical and dental services for free to honor their role in peace and security missions.

“We cannot thank them enough. We are grateful to all of them,” Major Gen. Antonio G. Nafarrete, commander of 6th ID, told reporters.

Bangsamoro Labor Minister Muslimin G. Sema, who is chairman of the Moro National Liberation Front, told reporters that the 6th ID had evolved from a state “fighting machine” out to quell Moro uprising in Central Mindanao into a partner of its erstwhile enemies, the Moro National Liberation Front (MNLF) and the Moro Islamic Liberation Front (MILF).

No fewer than 500 soldiers in different units of 6th ID are either children, or relatives of former MNLF and MILF guerillas, who had been reintegrated into the local communities as part of the Mindanao peace process.

“Our members had figured in bloody clashes with units of the division in the 1980s until the early 1990s. Now we see its personnel visiting our enclaves in Central Mindanao as peacebuilders, rescuing people from floods, extending support, giving out food and medicines to calamity-affected families and helping resolve family feuds among big Moro families,” Mr. Sema said. — John Felix M. Unson

Prabowo sworn in as Indonesia’s 8th president

INDONESIA’S new president, Prabowo Subianto, shouts after being inaugurated at the House of Representative building in Jakarta, Oct. 20, 2024. — REUTERS

JAKARTA — Indonesia’s Prabowo Subianto on Sunday took over as president of the world’s third-largest democracy after sweeping the country’s election with policies like free meals for school children and with the outgoing leader’s son as his running mate.

The 73-year-old former special forces commander won the Feb. 14 contest with nearly 60% of the vote and has spent the past nine months building a formidable parliamentary coalition.

Prabowo, wearing a traditional black hat and navy suit with a woven maroon and golden sarong, officially become Indonesia’s eighth president on Sunday morning after he was sworn in during a ceremony at Indonesia’s parliament.

Prabowo, who unsuccessfully ran for the presidency twice before, said in a speech to lawmakers after taking his oath of office that he would be president for all Indonesians, even those who did not vote for him.

But he said there were internal issues in the country that had to be grappled with, including corruption.

“Do we realize that our people and our children are malnourished. So many of our people don’t have good jobs. So many of our schools are neglected,” Prabowo said.

“Ladies and gentlemen, we have to be courageous looking at all of this, and we have to be courageous solving all these problems,” he said.

He was joined in the swearing-in ceremony by his running mate, Gibran Rakabuming Raka, 37, the eldest son of outgoing President Joko “Jokowi” Widodo.

As they make their way to the presidential palace through a festival-like atmosphere they will be greeted by thousands of flag-waving supporters thronging Jakarta streets lined with posters of the incoming leader.

Flower boards set up outside the palace either congratulated Prabowo and Gibran or thanked Jokowi for his decade as president.

Prabowo and Gibran are expected to stop at seven stages along the way between parliament and the palace, Nusron Wahid, a Prabowo aide, told reporters on Friday.

Jokowi supporters are also attending the celebrations to bid farewell to Indonesia’s outgoing leader.

Anneta Yuniar, a bystander who had excitedly waved at Jokowi’s motorcade as it slowly made its way past supporters before the ceremony, said she would miss Jokowi but that Prabowo was a strong leader.

“Prabowo will continue the development that Jokowi started. There’s continuity. It’s what I want,” she said.

Jokowi has left an indelible mark on the nation of 280 million, presiding over a period of strong economic growth and massive infrastructure development.

Critics also say, though, his rule has been marked by a rise in old-time patronage and dynastic politics, and they warn about diminished integrity in courts and other state institutions.

Indonesian police and military have put in place strict security measures, deploying at least 100,000 personnel across the city, including snipers and anti-riot units.

Prabowo is expected to meet with foreign dignitaries, including a number of heads of state, later on Sunday at the presidential palace, said Hasan Nasbi, the head of the presidential communications organization.

China said it is sending Vice-President Han Zheng to the inauguration. The delegation from the United States is being led by US Ambassador to the UN Linda Thomas-Greenfield.

During his campaign, Prabowo billed himself to voters and investors alike as the “continuity candidate.”

He has set a target to accelerate economic growth to 8% from a current rate of 5%, pledged to make Indonesia self-sufficient in production of staples, and signalled a more active role on the global stage.

Past allegations against Prabowo of involvement in the kidnapping of student activists and human rights abuses in Papua and East Timor, however, have also raised concern about Indonesia’s trajectory of democracy, human rights advocates say.

Prabowo has always denied the allegations that led to his dismissal from the military in 1998, the same year Indonesia broke free from the decades-long authoritarian rule of former President Suharto. — Reuters

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