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Delayed 2019 budget expected in Malacañang by March 10

THE delayed 2019 budget remained untransmitted to the President well into the third month of the year, amid claims of last-minute revisions to the General Appropriations Bill (GAB) approved by Congress, though a key legislator said the legislation will be forwarded to the Palace by March 10.
Senator Panfilo M. Lacson alleged in a statement Tuesday that the GAB is being “manipulated” after both Houses of Congress ratified the measure, but House Appropriations Committee chair Rolando G. Andaya, Jr. of the 1st district of Camarines Sur said the last-minute adjustments are being undertaken to “itemize” certain lump-sum funds.
“The House is itemizing the appropriations therein, fleshing out lump-sum funds, without departing from the approved specifications of the House-Senate approved budget, and by so doing make the budget more transparent and easy to scrutinize,” Mr. Andaya said in a statement Tuesday.
“We believe that by detailing the items in the budget, by enumerating what will be funded, projects and programs, per agency and by district, will be clear and evident,” he added.
President Rodrigo R. Duterte’s spokesman Salvador S. Panelo on Tuesday said Speaker Gloria Macapagal-Arroyo has rejected claims of last-minute changes to the budget.
“According to Speaker Arroyo, as far as she knows, whatever is approved in the (bicameral conference committee) is now the one being printed for submission to the Executive,” Mr. Panelo told reporters after his phone conversation with Ms. Arroyo.
Mr. Lacson said the “manipulations” include Health Facilities Enhancement Program (HFEP) funding of P25 million for individual legislators as opposed to P8 million each for others.
The House and the Senate ratified the budget bill on Feb. 8, but have yet to transmit the final version to the President for signing. Mr. Andaya said in a phone message that the chamber plans to transmit the 2019 GAB on “March 10.”
Minority Leader Danilo E. Suarez of the 3rd district of Quezon called legislators with reduced funding “collateral damage” of the House’s leadership struggles.
Also on Tuesday, the House Minority bloc said it will continue with ongoing investigations against former Budget Secretary Benjamin E. Diokno after his appointment as the new governor of the Bangko Sentral ng Pilipinas.
“There are still pending issues in the House. We have no closure,” Mr. Suarez said. “I intend to continue with the hearings, taking advantage of my remaining months in Congress.”
Mr. Lacson called the “manipulation” of the budget “brazen and illegal” as well as “a clear violation of the 1987 Constitution, which states in Article VI Section 26: “Upon the last reading of a bill, no amendment thereto shall be allowed.”
Asked to comment, Senate President Vicente C. Sotto III on Tuesday said he was consulting with the Senate committee on finance, which is headed by Senator Loren B. Legarda, on the allegations of Mr. Lacson.
“Yes, I’m aware and I’m consulting (Senator) Loren (B. Legarda) and Ping (referring to Mr. Lacson). I think I would know what to do,” he said in a mobile phone message to reporters.
“I will not sign anything that we did not approve. You should know me better than that,” he added.
Economic managers have stressed that further delays in the passage of the 2019 national budget will hurt the country’s economic growth in the first quarter of the year and will delay the government’s big-ticket projects.
Congress’ deliberations on the 2019 national budget were delayed by allegations of “insertions” made by both chambers of Congress, which have been branded “pork barrel” in another form. — Charmaine A. Tadalan, Arjay L. Balinbin, Camille A. Aguinaldo

Time running out on Official Dev’t Assistance projects, Senate panel told

THE SENATE COMMITTEE on economic affairs on Tuesday opened its inquiry into the official development assistance (ODA) funding under the Build, Build, Build program, with participants claiming that the ODA financing may have slowed the completion of flagship infrastructure projects.
Foundation for Economic Freedom (FEF) fellow Alan T. Ortiz pointed out that the current Philippine administration no longer has the “luxury of time” to complete its flagship infrastructure projects within President Rodrigo R. Duterte’s term given that it has only executed nine ODA loans agreement in the past three years.
Finance Assistant Secretary Maria Edita Z. Tan of the International Finance Group said nine loan agreements have been executed by the Duterte administration for ODA-funded projects under the Build, Build, Build program. Five were funded by Japan, two by South Korea, and two by China.
Meanwhile, National Economic and Development Authority (NEDA) Assistant Secretary Jonathan L. Uy said the government is targeting 56 of 75 flagship infrastructure project for possible ODA funding.
“By its very nature, Build, Build, Build is very ODA-driven and from past experience as head of the Philippines assistance program, ODA is naturally designed to be not fast. Case in point, the nine contracts that have been signed so far took three years. That is the rule of thumb: three years from concept to signing. Another year for financing, and then you’re left with one year in a six-year administration to start implementing and do the groundwork,” Mr. Ortiz said.
“Our appeal as a private sector think tank is for a new sense of urgency to take over the typical thinking of our bureaucracy… This administration is at its midpoint (and) technically has two years left, not three… My dear bureaucrats, you only have two years to get the other 37 contracts to be signed and for the ground to be broken… I’m all for Build, Build, Build, but you don’t have the luxury of time,” he added.
Bases Conversion and Development Authority (BCDA) President and CEO Vivencio B. Dizon said ODA financing was “not necessarily slow,” citing the gains made the government when it came to the Japan-funded Metro Manila Subway project and the North-South Commuter Railway (NSCR) project.
“With respect to PPP (Public Private Partnership), we would like to reiterate that the government’s priority is to fast-track Build, Build, Build… We also want to find other sources of both financing and implementation will allow us to catch up and implement Build, Build, Build,” he said.
“The administration understands the need to subsidize infrastructure to the greater public and that’s why we’re taking the lead in building infrastructure through government expenditure rather than the shared capital risk arrangement with the private sector at this time,” Mr. Uy said for his part.
Mr. Uy also told senators during the hearing that the government as of January is targeting to complete 28 projects before 2022.
Committee chair Senator Sherwin T. Gatchalian also weighed in on the interest rates offered by China, Japan, and other lending institutions when it came to ODA funding.
Ms. Tan said Japan offered lower interest rates at 0.10%. She also pointed out that China’s 2% to 3% rates were lower than those offererd by multilateral lending institutions, such as World Bank and Asian Development Bank (ADB). But despite the favorable rates of Japan, the Department of Finance (DoF) official raised the need for the Philippines to diversify its sources of ODA funding.
“We have to diversify. We have the technology to consider, we have the currency to consider because some of the currencies could be volatile,” she said.
“In the case of JICA (Japan International Cooperation Agency) and other ODA, we look at the terms and the comparative advantage. We look at some strategic concerns as well, like what type of projects you want to give to an ODA partner. Because you cannot give everything to just one. Much as you would want to give it to Japan, you shouldn’t do that… There’s always currency risk. And the other one is you should not be limiting yourself to just one source of technology. There should be a good match between your requirements and what they’re providing,” she added. — Camille A. Aguinaldo

Piñol claims Duterte backs raising agriculture budget ‘10 times’

AGRICULTURE Secretary Emmanuel F. Piñol invoked President Rodrigo R. Duterte’s authorization to propose a budget “10 times” his department’s current funding level, which was P56 billion in 2018.
Mr. Piñol said in a social media post that the President gave him the instruction “during a full Cabinet meeting last night (Monday night).”
There was no immediate confirmation of the budget instruction from the President’s spokesman at deadline time. Asked for comment, Finance Secretary Carlos G. Dominguez III said via text message: “Budgets are proposed by the President but approved by the legislature. The budget for 2019 has just been passed by the legislature and is awaiting action by the President. The allotment for the DA has not increased by 10x. The 2020 budget is being crafted now and no figures are available yet.”
“During a full Cabinet meeting last night, the President asked the Agriculture Secretary to submit a budget proposal ‘10 times bigger’ than what it has now,” Mr. Piñol said in his post.
A budget of 10 times current levels would constitute a significant portion of national spending. The 2019 budget is about P3.7 trillion.
“‘Tell me how much you need and I will ask Sonny (Mr. Dominguez) to give you the money,’ the President told me during the Cabinet meeting which lasted until 12 midnight,” Mr. Piñol added.
According to Mr. Piñol, the President said that he wants a higher budget for the agriculture sector as the country’s population is increasing by two million annually.
“The President also said that there should be greater focus on agricultural infrastructure and asked the concerned departments to revisit the Roll-On, Roll-Off Program of former President Gloria Macapagal Arroyo,” Mr. Piñol said.
“The President also asked DA to focus on the farm-to-market food chain to ensure that farmers and fishermen are able to sell their produce at a fair price,” he added. — Reicelene Joy N. Ignacio with Arjay L. Balinbin

NGCP declares ‘yellow alert’ for Luzon power grid

RESERVE ENERGY in the Luzon grid fell below minimum levels on Tuesday, prompting the system operator to issue a “yellow alert” a day after the Energy department gave its assurance that power supply is sufficient for the dry season.
Privately-owned National Grid Corp. of the Philippines (NGCP) said the country’s biggest power grid was placed on yellow alert between 11:00 a.m. and 5:00 p.m. and again from 7:00 p.m. to 9:00 p.m.
NGCP said available capacity on Tuesday was at 10,115 megawatts (MW) while peak demand during the day hit 9,491 MW.
“Luzon grid is on yellow alert due to the unexpected shutdown and limited generation of some power plants, and high power demand,” the system operator said.
It deferred to the Department of Energy (DoE) the announcement on which power plants were on an unscheduled shutdown.
The warning came even before the expected full impact of the El Niño weather phenomenon in May. The DoE expects peak demand in Luzon to reach 11,403 MW during that month.
“This is the first yellow alert for the Luzon grid this year,” NGCP said.
NGCP has several levels of reserve energy that it uses to stabilize the fluctuating power demanded from the electricity grid.
A frequency regulating reserve is the standard operating requirement to maintain a balance between available capacity and system demand, and should address small variations during normal operation. The regulating reserve is ideally equivalent to 4% of the demand for the hour.
On top of the regulating reserve, NGCP also maintains a contingency reserve that it allocates to immediately answer any reduction in supply when the largest power generating unit online — usually at 600 MW — fails to deliver.
Aside from these reserves, the operator also maintains a dispatchable reserve that is readily available to replenish lost contingency reserve.
When these reserves fall below ideal levels, NGCP issues a “yellow alert,” which is downgraded to a “red alert” when the power supply situation worsens.
The other day, the Department of Energy (DoE) said it adjusted the output of the hydroelectric power plants (HEPPs) in Luzon after the forecast “weak” El Niño during the April-June months. It placed the expected capacity reduction at 30%.
“While El Niño is seen to have the greatest impact in Luzon due to the number of HEPPs in the area, the grid will continue to be under normal conditions,” it said.
The DoE also said that in the instance of forced outages in the Luzon grid, there would be an additional 350-MW buffer, with a 200-MW “importation” coming from the Visayas grid and 150-MW coming from the remaining Malaya diesel power plant. — Victor V. Saulon

BPO investors worried by Iloilo power uncertainty

NEW INVESTMENT in the information and technology industry in Iloilo City, particularly the business processes outsourcing (BPO) sector, could slow down due to the unresolved arrangements for the city’s power distribution.
Iloilo Federation for Information Technology (IFIT) Chairman Jessraf S. Palmares, in an interview, said some potential investors are reluctant to pursue their planned ventures.
“There are other players who want to come to the city, but they are hesitant to come in because of the issue,” Mr. Palmares said.
The city’s current power distributor lost its franchise but is mounting a legal challenge to the new franchise holder’s bid to take over its physical assets.
“The longer this issue stays we cannot assure that new investors will come in. Existing investors are telling us that they will be looking into other sites. The situation is preventing investors from coming in,” he added.
Mr. Palmares said the association had no issues with the service of the outgoing distributor, Panay Electric Co. Inc. (PECO).
“So far for the last few years there has been a surge in development, and we have grown the industry rapidly, which requires a lot of power, and they were able to meet our requirements,” he said.
“As an industry, we don’t have any issue and problems with [PECO], so our question is why fix it when it’s not broken?”
On Feb. 28, the new franchise holder, MORE Power and Electric Co. (MORE Power), presented its plans to the business sector in a closed-door forum organized by the Iloilo Economic Development Foundation Inc.
The company’s franchise was signed by President Rodrigo R. Duterte on Feb 14.
MORE Power President Roel Z. Castro told the business community that it will provide upgraded customer service, simplify the application process and make payment centers more accessible.
With a committed capital expenditure of P1.3-billion, MORE Power also promised to improve supply distribution.
MORE Power also promised to deliver cheaper cost with an indicative potential savings of P1.21/kilowatt-hour (kWh) compared to current charges.
Mr. Castro said MORE Power has been negotiating with possible power producers in the Visayas offering power supply at the least cost.
“Our negotiations are in the final stages with AP Renewables Inc, KEPCO SPC Power Corp., and Palm Concepcion Power Corp.. They are offering 1/3 less of the existing power generation, which is P7.84 kWh as of January 2019. That is P6.63/kWh vs P7.84/kWh,” he explained.
However, Mr. Palmares said cheaper power is less important than “reliability” above anything else.
“Yes, they have lowered cost but that is not how the IT industry thinks. The lowered price does not really affect us… It’s more of reliability,” he said.
The BPO industry has set an employment target of 30,000 employees by 2022, according to Mr. Palmares.
“The problem is, existing companies, with all these problems with (power distribution), will decide to pull out because of uncertainty,” he said.
As the incoming franchise holder, MORE Power does not have assets in place.
On the other hand, PECO, whose franchise expired on Jan. 19, has maintained that it will not sell its assets to MORE Power and will mount a legal challenge all the way to the Supreme Court if necessary.
PECO has been granted an extension of at least two years until MORE Power is ready to take over.
Iloilo province’s Local Economic and Investment Promotion Officer (LEIPO) Velma Jane C. Lao said the battle is now between PECO and the government.
“It’s not even a fight between PECO and MORE Power. It’s PECO and now the government if they take a hard stance on this,” she said
Halley Alcarde, assistant vice-president of Gaisano Capital, backed Ms. Lao’s position and said the government should to do what is beneficial for the public.
“Government right now has the balls to do and implement what’s due and right for the people,” he said.
Mr. Alcarde also questioned PECO’s inability to lower electricity prices in recent years despite the availability of lower power supply.
“Every time we presented Iloilo to businessmen and investors, they always say that your power costs are very high,” he said.
Iloilo Business Club (IBC) Executive Director Maria Victoria Lara said she hopes that the situation will be resolved immediately.
“They have assured us (that) the public will not be inconvenienced… The sooner that all these things are resolved, the better it is for consumers,” she said. — Emme Rose S. Santiagudo

Fixed-salary rules for bus drivers, conductors to be in force by March 9

THE DEPARTMENT of Labor and Employment (DoLE) gave bus companies until March 9 to incorporate a semi-fixed salary component in paying their drivers and conductors, a compensation structure that was sanctioned by the Supreme Court last year.
In a radio interview on Tuesday, Secretary Silvestre H. Bello III said that bus companies should comply with the part-fixed, part performance based salary.
“Kailangan sundin na nila ‘yung minimum wage law at saka ‘yung provision on overtime and entitlement sa ibang benefits of a regular employee. Hindi na kagaya noong araw na on commission basis,” he said.
(They need to follow the minimum wage law and also the provision on overtime and the regular employee’s entitlement of other benefits. It shouldn’t be like back then when it was still a commission basis).
The elimination of purely performance-based compensation is expected to eliminate behavior that worsens road travel conditions or makes it more dangerous, including racing to the next stop in order to be first to load new passengers and lingering in pickup areas.
By March 9, Mr. Bello added, “Bus drivers will be considered regular employees, and the computation of daily wages should start.”
On Feb. 15, DoLE agency the National Wages and Productivity Commission (NWPC) released revised guidelines on bus employee compensation and required bus companies to submit their two-tier compensation schemes to the labor department.
The guidelines also call on bus operators to follow the “part fixed, part performance based” compensation scheme stated in DoLE Department Order No. 118-12. The performance-based component should be computed as the current average daily earnings minus the fixed wage. The fixed wage should follow the prescribed daily salary of each region.
Mr. Bello said that bus companies should welcome this because it assures the safety of the driver, conductor and passengers, adding “Accidents are often caused by drivers seeking to maximize their passengers and increasing their commissions. That’s risky.”
In September, the Supreme Court (SC) ruled that the part fixed, part performance-based compensation scheme to be legal, adding that the fixed income component “equalizes the playing field, so to speak, so that competition and racing among bus drivers are prevented.” — Gillian M. Cortez

Farmers question agencies’ capacity to disburse rice tariffication funds

THE Federation of Free Farmers (FFF) cast doubt on Tuesday on the capacity of small government agencies to effectively disburse the P10 billion-a-year Rice Competitiveness Enhancement Fund (RCEF), one of the features of the Rice Tariffication Law.
In a briefing in Quezon City, FFF National Manager Raul Q. Montemayor said that the agencies overseeing the fund, like the Philippine Center for Postharvest Development and Mechanization (PHilMech) and the Philippine Rice Research Institute (PhilRice) may not have the reach or the manpower, while the Technical Education Skills Development Authority (TESDA) on the other hand is not an agriculture-focused training center.
Mr. Montemayor added that TESDA is in a partnership with the law’s principal author Senator Cynthia A. Villar’s farm school Villar Sipag, which means that a part of the budget will benefit Ms. Villar’s foundation.
Under the law, the rice tariffication will provide P10 billion in funding each year fro six years to assist rice farmers, with 50% for farm mechanization; 30% for development, propagation and promotion of inbred seed; 10% for low-cost farm credit facilitated by the Land Bank of the Philippines (LANDBANK) and the Development Bank of the Philippines (DBP); and 10% for extension services to upgrade farmers’ skills in crop production, seed production, modern rice farming techniques, farm mechanization, and facilitate technology transfer through farm schools.
“The fund seems to have an intended beneficiary, which is the foundation” Mr. Montemayor said.
“Agriculture training is not TESDA’s expertise,” Mr. Montemayor added.
Mr. Montemayor said that the government is in a hurry to implement the law without adequate study. He noted that while rice tariffication is part of the country’s commitment to the World Trade Organization (WTO) which should have been implemented more than two decades ago, the removal of the licensing authority of the National Food Authority (NFA) is not part of the agreement.
“I can’t understand why they removed that, not just among importers but all the way down to the retailers. How can you track the movement of the rice [and] the inventory of rice?” Mr. Montemayor said.
According to Mr. Montemayor, by removing NFA’s power to regulate the industry, the market is now more vulnerable to smuggling.
Among the requirements to import rice under the new law is to have access to a warehouse. The NFA will no longer license any importer, but importers have to go to the Bureau of Plant (BPI) industry to secure sanitary permits.
The FFF and other groups of rice farmers declared their opposition to the law, which took effect yesterday. The other groups include Pambansang Koalisyon ng Kababaihan sa Kanayunan, Centro Saka, Rights Watch, Pambansang Kilusan ng mga Samahan sa Kanayunan, Save Agrarian Reform Alliance, Integrated Rural Development Foundation, Pambansang Kilusan ng Magbubukid sa Pilipinas, the National Movement for Food Sovereignty, Kilusan para sa Repormang Agraryo at Kataturungan Panlipunan, and Rice Watch Action Network. — Reicelene Joy N. Ignacio

Family planning strategy targets 65% contraceptive takeup

MALACAÑANG on Tuesday said President Rodrigo R. Duterte has approved the “full and intensified” implementation plan for the government’s national program on family planning.
“The key strategy is the use of effective modern contraceptives where 11.3 million women would be given access to over the next four years. The aim is to increase the usage thereof from 40% to 65%,” Presidential Spokesperson Salvador S. Panelo said in a statement.
Mr. Panelo said the President approved the “the full and intensified Implementation Plan for the National Program on Family Planning” during the Cabinet meeting on Monday, March 4, after it was presented by the Director-General of the National Economic and Development Authority, Socioeconomic Planning Secretary Ernesto M. Pernia, and Executive Director of the Commission on Population and Development, Juan Antonio A. Perez III.
He added: “The approval of the aforesaid plan is expected to reduce poverty incidence in the country, which currently has the highest fertility rate and fastest growing population in the ASEAN region,” Mr. Panelo said. Poverty is expected to drop “from the current 20% to 14% in 2022, the year PRRD (Mr. Duterte) steps down from office. Aside from poverty reduction, the plan equally aims to promote better health and socioeconomic development among Filipinos.”
Mr. Panelo also said the government understands that “a great majority of Filipinos favor family planning but not all of them have access to contraceptives for various reasons.”
“Accordingly, the government is here to respond and help those who wish to undergo family planning,” he said further.
Also during the Cabinet meeting, Housing and Urban Development Coordinating Council Chairperson Eduardo D. Del Rosario, according to Mr. Panelo, “thanked the President for the creation of a housing department.”
“The President further approved the proposed construction of 31 Evacuation Centers in six provinces from Region V,” he said.
The President was also updated on the actions taken by the Department of Agrarian Reform (DAR) to streamline the land-use conversion process.
“After the issuance of an executive order, DAR will be able to process land conversion within 30 days compared to the previous 190 days,” Mr. Panelo said.
DAR, he added, was instructed to submit the complete staff work to the Office of the Executive Secretary. — Arjay L. Balinbin

UHC Act:The role of Health Technology

The Universal Health Care (UHC) Act, also known as Republic Act 11223, was signed by President Rodrigo Duterte on February 20. Under this landmark legislation, all citizens, including overseas Filipino workers (OFWs), will be automatically enrolled into the National Health Insurance Program (NHIP), either as direct or indirect contributors, who will be eligible and have access to preventive, promotive, curative, rehabilitative and palliative care for medical, dental, mental and emergency health services.
The NHIP is being administered by the Philippine Health Insurance Corporation (PhilHealth), a government corporation attached to the Department of Health (DoH).
One of the objectives of the UHC Act is to realize universal coverage through a systemic approach and clear delineation of roles of key agencies and stakeholders toward a better performance in the health system. This is actually aligned with the DoH’s flagship program and tagline of “Boosting Universal Health Care via FOURmula One Plus.” The Act is foreseen as the cornerstone that will lead all Filipinos to receive the needed health services without causing financial hardship.
The effective implementation of the Act will rely on building adequate infrastructure, such as access to screening, timely and accurate diagnostics, and the presence of a skilled health work force. Moreover, in order to realize a true universal coverage, the health system should reach populations who are less likely to seek or have access to quality health care, such as those who belong to the vulnerable and marginalized groups.
Amid these overwhelming demands for quality and effective health care, the law is also expected to prioritize and facilitate major reforms that will consolidate the existing yet fragmented financial flows, significantly improve the governance and performance of the devolved local health systems, and institutionalize support mechanisms, such as health promotion and health technology assessment.
Health technology, as defined by the World Health Organization (WHO), is the application of organized knowledge and skills in the form of devices, medicines, vaccines, procedures and systems developed to solve a health problem and improve the quality of lives. The term health technology assessment (HTA) was first quoted about 30 years ago and was considered as a way of strengthening the evidence-based selection and rational use of health technologies and increase efficiency when introducing and using the technologies in health care.
Under Section 34 of the UHC Act, the HTA process shall be institutionalized as a fair and transparent priority setting mechanism for the development of policies and programs, regulation, and the determination of a range of entitlements such as drugs, medicines, pharmaceutical products, and other devices, procedures and services, that is recommendatory to the DoH and PhilHealth. The HTA will also recommend the development of any benefit package.
In 2013, WHO publications and resolutions indicated that HTA is an important tool to further advance the implementation of UHC in terms of deciding who should be getting which intervention and at what cost. These concepts are linked to people-centered care, essential packages, resource allocation, and quality of health services delivery to get more cost-effective health care.
Commonly conducted by interdisciplinary groups, the HTA uses analytical frameworks, drawing on clinical, epidemiological, health economic and other information and methodologies. It may be applied to interventions, such as including a new medicine into a reimbursement scheme, rolling out public health programs (such as immunization), priority setting in health care, identifying health interventions that produce the greatest health gain and offer value for money, setting prices for medicines and other technologies based on their cost-effectiveness, and formulating clinical guidelines.
Prior to the passage of the UHC Act, the Philippine health sector lacked a formal national program for HTA, although there were efforts to apply its principles, for instance, when the HTA Committee was established by PhilHealth in the 2000s. The initial role then of the Committee was to conduct assessments of drugs, medical and surgical procedures, and other health interventions that became the basis for PhilHealth’s benefit packages, reimbursement policies and accreditation standards for health providers.
Based on the provisions stated in the newly signed UHC Act, a Health Technology Assessment Council (HTAC) will be formed and composed of health experts: namely: (1) public health epidemiologist; (2) health economist; (3) ethicist; (4) citizen’s representative; (5) sociologist or anthropologist; (6) clinical trial or research methods expert; (7) clinical epidemiologist or evidence-based medicine expert; (8) medico-legal expert; and (9) public health expert.
Once the HTAC positions are fully occupied, they are primarily expected to (1) facilitate provision of financing and/or coverage recommendations on health technologies to be financed, (2) oversee and coordinate the HTA process within DoH and PhilHealth and (3) review and assess existing benefit packages. The HTAC is also expected to conduct assessments in accordance with the principles, criteria and procedures that will ensure that its process is transparent, conducted with reasonable promptness, and the results of its deliberations are made public.
Furthermore, subcommittees will also be formed within the Council, mainly divided into: drugs, vaccines, clinical equipment and devices, medical and surgical procedure, preventive and promotive health services, and traditional medicine.
Earlier last month the DoH announced its call for HTAC nominations, ending on February 28. The nominees should have the track record and competencies that will emulate the expectations and objectives of the Act. Upon five years of the HTAC’s establishment and operation, the Council will transition into an independent entity, separate from the DoH, and will then be attached to the Department of Science Technology (DoST). As long as qualified members will still be appointed to be part of the Council, this should not be taken as a challenge but perhaps even as an advantage.
Nevertheless, the success of the law will not only be dependent on HTAs. Like other enacted policies, its proper implementation will surely depend on political support and leadership. The accountability for decision-making should be clearly established, together with the constant source of funding.
Lastly, the Joint Congressional oversight committee on universal health care should regularly exercise their powers to review the implementation of the law. This will entail a systematic evaluation of the performance of the various agencies with respect to their roles and functions with regards to the objectives of the UHC Act. The lead agencies should also take into consideration the various roles of stakeholders (e.g. patient groups and related industries) in achieving the ultimate goal of universal health coverage.
 
Alvin M. Manalansan is Health Fellow at Stratbase ADR Institute.

Inflation, Interest Rate, BSP Governor, and Travel Tax

“Many people want the government to protect the consumer. A much more urgent problem is to protect the consumer from the government.”

— Milton Friedman (1912-2006),
Nobel Prize economist

This paper will briefly cover four topics showing various degrees of “outlierness” in Philippines economic performance and policy compared to our neighbors in Asia.
(1) Inflation rate. The Philippines registered a 4.1% inflation rate average for the first two months of 2019. The good news is that it is a lot lower than the past four months average of 6.1%, but the bad news is that compared to our neighbors, it is the highest. In the ASEAN-6, Malaysia experienced a deflation, Singapore and Thailand have near-zero inflation while Indonesia and Vietnam have below 3% (see table).
Inflation Rate, selected Asia, in %
So we are the inflation outlier in the region. Since Dutertenomics’ TRAIN law has penalized the consumers with high inflation (1.3% in 2016, 2.9% in 2017, 5.2% in 2018), the administration should compensate this year by targeting a 1-2% inflation via tax cut somewhere, or suspension of tax hikes. Far out. Its mantra is spend-spend-spend, tax-tax-tax, borrow-borrow-borrow. Let the future taxpayers worry about current high borrowings.
(2) Interest rate. In particular, Bank lending rates, the numbers for March 2018 to January 2019, are:
Bank Lending Rate
So the Philippines is an outlier again, the only economy with ever-rising rates and surpassing the 7% mark.
(3) New BSP Governor. The third BSP Governor, Armando Tetangco, worked at BSP for two decades before he was appointed Governor in 2005. His successor, the late Nesting Espenilla, also worked at BSP for more than three decades before he was appointed as the fourth Governor. The new and fifth Governor, Ben Diokno, is somehow an outlier because he has zero BSP work experience, zero private banking experience. But he is a known economist, was a two-term DBM Secretary (under former President Erap Estrada, then President Rodrigo Duterte). Diokno was my teacher twice, in undergrad mid-80s then graduate studies late 90s in UPSE. I notice that he’s a fiscal hawk, practicing spend-spend-spend philosophy at DBM. I just hope that he will not be a monetary hawk, print-print-print money at BSP.
(4) Travel tax. In my work as a free market advocate in the Philippines, I get to travel abroad about 3x a year mostly in Asia, all expenses covered by my various sponsor-think tanks and fellow free market institutes. I see plane fares fluctuate depending on the season but one thing that does not fluctuate is the Philippines travel tax (P1,620 for economy, P2,700 first class passengers).
While my sponsors pay for my plane fare including the travel tax (makes my travel cost go higher), occasionally I would bring my family when the kids are on school break and plane fare is cheap (KL, HK, Bangkok) as they can stay in my hotel for free for few days. I have to pay extra for their travel tax.
The Philippines is an outlier again because we seem to be the only country in Asia that imposes a travel tax on its citizens. This is on top of airport terminal fee of P700 and there is not even free drinking fountain.
Travel tax abolition should be done. Senate Bill 1841 by Sen. Koko Pimentel aims to do this but it was not even passed at the Committee level. TIEZA and other bureaucracies that benefit from gouging more taxes from Filipinos oppose. They should be abolished too someday.
 
Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers.
minimalgovernment@gmail.com

Colossal denials by the masters of bluster

Which of the two presidential denials would you consider more colossal or spectacular?
President Donald Trump’s insistence that Special Counsel Robert Mueller’s inquiry into Trump’s possible violation of law is a hoax and a witch hunt?
Or President Rodrigo Duterte’s assertion that there is no proof that the Marcoses amassed ill-gotten wealth?
I would say it’s a toss-up. Both Trump and Duterte have proven themselves to be Masters of Bluster, although Trump can probably claim the crown as the Lying King.
With so many of his closest associates and confidants facing jail time and his former lawyer and enforcer, Michael Cohen, bluntly calling Trump “a racist, a con man and a cheat,” Trump still adamantly denies any wrong-doing by anyone, especially himself.
That clearly qualifies as a Mother of Denials. But Duterte’s recent declaration about the Marcoses could easily beat Trump’s fiction.
Duterte’s fantasy is that there is no proof that President Ferdinand Marcos and his family (the ones overthrown by the People Power Revolt, remember?) made billions in unexplained — a.k.a. ill-gotten — wealth.
A news item written by Alexis Romero quotes Duterte as follows: “Until now you have not proven anything except to sequester and sell — hindi mo nga sigurado kung talagang kay Marcos ba ‘yan?”
That brings to mind the joke about two morons, walking along the railroad tracks, who spot body parts on the rails.
“Those look like Joe’s arms and legs,” says one moron.
The second moron, upon seeing a decapitated head, picks it up and declares: “It is Joe’s head.”
And the first moron asks: “Joe…Joe, are you hurt?”
The swards in our neighborhood in Parañaque have an apt expression for that: “Obvious bah???”
In the case of Trump, the applicable joke is about the two morons who spot a pile of bullshit. The morons debate whether or not the filthy mound is b.s. So one of the morons decides to taste it. Only then do the morons agree that it is, in fact, b.s.
A different and more accurate punchline is that even if Trump tastes the bullshit, he will continue to deny it.
In his book, From Third World to First, the late Prime Minister Lee Kuan Yew of Singapore recounts how he and his group of reformers cleaned up the corruption in their island nation.
They passed a law that presumed that wealth that could not be explained by a public official’s legitimate salary and assets was ill-gotten. In other words, stolen.
Of course, it would not be surprising if Duterte — in fact, nearly all Philippine politicians and public officials — would refuse to accept that premise. There would not be enough jail cells to accommodate those with unexplained cars, mansions, overseas homes, Swiss bank accounts, mistresses and cash-in-hand if the Unexplainables were required to be accounted for, under pain of imprisonment.
One politician who could provide a believable explanation for his millions is Sen Manny Pacquiao. He has the lumps to corroborate it.
Sen. Antonio Trillanes IV is still waiting for Duterte to explain his alleged millions — as well as those of members of his family — but it looks like Trillanes will wait in vain. His tenure as member of the Senate is running out and that will strip him of immunity if he makes “unfounded” accusations.
The remarkable parallels between Trump and Duterte extend beyond colossal assertions. There are, for instance, their respective obsessive campaign promises which they are desperately trying to fulfill while changing the terms of reference.
Trump vowed to build a border wall that the Mexicans would pay for. That promise has been adjusted several times to its current version which is a state of emergency to justify pulling funds from other sources to pay for the wall.
Duterte, on the other hand, vowed to get rid of the drug menace in three months, otherwise he would resign. The menace still exists and Duterte hasn’t resigned but he is still vowing to eradicate drugs — but not over his dead body. Over the dead bodies of thousands of others, some on mere suspicion.
Both Duterte and Trump have also been outdoing each other in their interpretation — or, rather, in their prostitution — of the law.
Duterte reportedly balked at going after illegal Chinese workers who have begun to proliferate in the Philippines because China might retaliate and go after illegal Filipino workers in that country.
That “tit for tat,” as alluded to by Duterte spokesman Salvador Panelo, is typical among crime lords. For the president of the Philippines to make that gangster-like statement should be cause for outrage among the citizenry. Why no outrage? Well. Because that’s the way Duterte talks and, in his own words, he should not always be taken seriously.
On the US side of the Pacific, Trump’s interpretation of right and wrong depends on whether it is right for him, never mind if it is wrong for others.
Trump’s acceptance of the denials concerning accusations of election tampering (denied by Russia’s Vladimir Putin) and the torture and death of a US citizen at the hands of the North Koreans (denied by Kim Jong Un) is a prostitution of the facts. But there is no outrage among the Republicans. Why no outrage? Well, because the Republicans who are holding elective office are terrified by Trump’s voter base which, he boasts, will stand by him even if he shoots someone in the middle of Manhattan.
Another example of the way Trump distorts facts to fit his purposes was his characterization of the neo-Nazi car ramming in Charlottesville, Virginia in 2017. Trump laid the blame as much on the victims as on the perpetrators, a clear case of speaking from both sides of his mouth.
Said Trump, “You had some very bad people in that group, but you also had people that were very fine people, on both sides.”
And speaking of Putin and the Chinese, that is another area where Duterte can be compared with Trump.
Duterte has his alleged Chinese connection (or weakness) while Trump has his alleged Russian connection (or collusion).
Whatever denials or explanations may be made by Duterte and Trump, what is undeniable is that the Chinese have muscled their way into areas in the West Philippine Sea over which our country claims sovereignty and Filipino fishermen are being deprived of their source of livelihood.
In the case of Trump, what is undeniable according to US intelligence agencies is that Russia tampered with the presidential elections and is still doing so, quite likely in preparation for 2020.
In a recent meeting between Duterte and US Secretary of State Mike Pompeo at the Villamor Air Base, the latter reportedly said to Duterte, “You’re just like our president.” Pompeo meant Trump, of course.
What is debatable is whether he meant the comparison as a compliment. Or as an insult.
 
Greg B. Macabenta is an advertising and communications man shuttling between San Francisco and Manila and providing unique insights on issues from both perspectives.
gregmacabenta@hotmail.com

Can’t leave charter change to politicians

By Michael Henry Ll. Yusingco
THE 1987 CONSTITUTION is considered one of the most enduring constitutions in the world because it has stood for almost 32 years without any amendment. This is an odd quality considering that most constitutional scholars will agree that a constitution is never infallible or immortal even as they continue to debate among themselves the ideal lifespan of a nation-state’s charter.
But none of these experts will ever deny that pathologies in a constitution can emerge during its reign. These pertain to provisions in the constitutional text itself that may have been designed with good intentions but have eventually become debilitating to the political system it purports to govern. The Philippine constitution is no exception.
And yet, one of the respected polling firms in the Philippines, Pulse Asia Research, released in 2018 results of a survey showing that 64% of respondents are not in favor of amending the 1987 Constitution.
So what could be driving this resistance to charter reform? One reason could be that this move has always been viewed as an underhanded scheme to extend the term of a sitting president. According to Professor Dante Gatmaytan of the University of the Philippines College of Law, this “skepticism is rooted in the Marcos era where the dictator used constitutional change to duck term limits.”
Political opponents of President Rodrigo Duterte claim that he could not be trusted with his promise not to run again for president under a new charter. Senator Leila De Lima, a staunch critic of Duterte and currently detained on drug charges, adds that it is difficult to rely on an administration that has already shown its “susceptibility for abusing power, for allowing impunity to reign, and for lying repeatedly to the public.”
Yet another possible reason why Filipinos are wary of charter reform is the lack of clarity on how to go about it. The 1987 Constitution provides three modes of constitutional amendment: 1) by Congress as a constituent assembly; 2) by a constitutional convention; and 3) by people’s initiative. In all three instances, any revision to the national charter shall only be valid when approved by the electorate in a plebiscite.
Duterte and his allies in Congress favor the constituent assembly mode because they see it as the practical choice. However, his critics counter that given the gravity of this political exercise for all Filipinos, the tab for it should not matter at all.
Moreover, those who push for the constitutional convention mode do so on the belief that such a body will be less beholden to Duterte as the current Congress seems to be. The memory of then-president Ferdinand Marcos using his martial law powers to railroad the enactment of the 1973 Constitution, which then facilitated his 14-year dictatorship, is still very much fresh in their minds.
To make matters even more volatile, the 1987 Constitution provides that any “amendment to, or revision of, this Constitution may be proposed by: (1) The Congress, upon a vote of three-fourths of all its Members.” The phrase “of all its members” has raised the question of whether Congress acting as a constituent assembly, meaning the Senate and the House of Representatives, should vote separately or jointly.
The prevailing view is that these chambers of Congress should vote separately. The surviving members of the 1986 Constitutional Commission are unanimous in advocating this view. Former members of the Supreme Court, legal scholars, and, understandably, all incumbent senators insist that the voting must not be done jointly.
The possibility of charter reform via a constituent assembly brings forth another possible reason why Filipinos are still hesitant. And it is the palpable conflict of interest afflicting those pushing for this mode. Indeed, it is quite reasonable to ask how Filipinos can rely on lawmakers to institute the necessary reforms that could impact their hold on political power?
Ironically, a member of the House of Representatives said: “If the ones who will discuss Cha-cha are just the House and Senate leaders, then many would view this as suspect at the very least, even dangerous, and at worst, self-serving.”
However, there is an obstacle to charter change that is more fundamental than the views of those who oppose it: The fact that the same Pulse Asia survey revealed that 75% of respondents said they had little or “almost none or no knowledge at all” of the 1987 Constitution.
Therefore, an indispensable requirement of constitutional reform in the Philippines, if it eventually pushes through, must be a back-to-basics education on the 1987 Constitution.
For this particular approach, the President can commission law schools to assume the lead role. This is certainly a daunting imposition but warranted nonetheless under the Volunteer Act of 2007.
The education sessions can be undertaken via the barangay assembly apparatus. Note that by statutory mandate the barangay is also a “forum wherein the collective views of the people may be expressed, crystallized and considered.”
Ostensibly, the detailed mechanics of the education sessions themselves shall be the responsibility of each law school involved. But the core syllabus must cover two stages. The first one is a remedial class reviewing two basic components of the constitution: 1) Responsibilities of each branch of government and the constitutional offices; and 2) Rights and obligations of citizens.
The second stage is an open forum to be guided by these questions: “1) Is there a need to amend or revise the Constitution? Why or why not? 2) If so, what parts of the Constitution should be amended or revised? Why?”
At the end of the sessions, each barangay assembly must produce a position paper answering these questions which shall then be formally endorsed to Congress to be utilized as resource materials.
The fact is Filipinos cannot simply leave constitutional reform in the hands of politicians. Indeed, the infamous Resolution of Both Houses No. 15 passed recently by the House of Representatives is a warning that cannot be ignored. Dynastic politicians will not hesitate to hijack charter change to perpetuate themselves in their positions of power. And the only way to keep this mob in check is for Filipinos to be actively and intelligently engaged every step of the way.
 
Michael Henry Ll. Yusingco is a law lecturer, legislative and policy consultant, and Senior Research Fellow at the Ateneo Policy Center of the Ateneo School of Government.

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