With bated breath

Hmmm, I said to myself, as a news brief caught my eye one rainy July morning.

A Supreme Court division had ordered two store managers jailed for six months for simple theft: they failed in June-October 2009 to give employees their share of service charge payments totaling less than P10,000.

Wouldn’t it be a sight to see top-ranking/influential crooks similarly get what they deserve for stealing millions to billions of pesos of our tax money?

Unlike many of our neighbors, however — including Vietnam which has been pulling away from us in nearly all competitiveness counts — we have yet to convict and jail any “big fish.”

Those of us who have been inured to the spectacle of such crooks laughing all the way to the bank may sneer at such wishful thinking. We have long held the dubious distinction of being one of the most corrupt countries in Asia, with deteriorating annual corruption perception metrics confirming anecdotes among individual entrepreneurs and big businessmen that this problem has been worsening by the year. Understandably, corruption has figured among the top five business concerns in this country for many years now.

JADED
And so, it was with mixed feelings that I listened to President Ferdinand “Bongbong” R. Marcos, Jr. punctuate his July 28 mid-term State of the Nation Address (SONA) with anti-graft/-corruption measures, e.g., providing school laptops that are not overpriced, putting long-idle trains to use, launching a crackdown on erring flood control contractors, and ensuring that national budget realignments do not stray from state priorities spelled out in the National Expenditure Program, etc.

On the one hand, it’s about time that Mr. Marcos finally included corruption in his SONA (an issue absent in his previous speeches, if I recall correctly). But the sporadic loud applause and exaggerated cheers in the audience immediately ruined the moment for many listeners (judging from social media comments and some officials’ reactions afterwards).

Senator Panfilo M. Lacson, Sr. and Baguio Mayor Benjamin B. Magalong would later verbalize what some of us felt as we beheld that spectacle, with Mr. Lacson remarking that “others who applauded were simply shameless hypocrites” who were otherwise involved in flood-control project irregularities, and Mr. Magalong estimating that corrupt politicians get kickbacks amounting to 35-40% of flood control and other infrastructure project costs.

On Tuesday, Senators Paolo Benigno “Bam” A. Aquino IV and Juan Miguel F. Zubiri dragged classroom construction out into the limelight, asking why these projects cost half of official government estimates when spearheaded by private outfits.

Some observers have criticized the latest SONA for failing to lay down the road map for Mr. Marcos’s remaining three years in office and, instead, focusing on improving public and social services. But let’s not forget that his senatorial slate suffered a severe drubbing in the last elections and that it has only been a few days since the administration finally saw some improvement in its public trust ratings. Hence, the need for measures that the masses would feel immediately. Perhaps the public outcry amid the latest floods could no longer be ignored. Perhaps this is an opportunity to go after opponents (just saw yesterday a socmed post claiming that the father of a stalwart of an opposing side is himself a contractor). Perhaps it’s all three.

Mr. Marcos followed up his SONA with a podcast interview in which he expounded on next steps on this matter, saying that:

• the government has “some names” of those responsible for the flood-control mess;

• names of contractors “whose poor work is very obvious” will go on a blacklist of those who “will no longer be allowed to enter into government contracts”;

• contractors “will have to account for the expenditures they made”;

• the government “will have to take the next step” regarding those who “can’t give a proper explanation”;

• some of the worst cases involve foreign-assisted projects (“That’s debt. We’re borrowing money just so these people can steal from it.”)

“They know who they are. Some of them are truly notorious. They’ve been doing this kind of thing for a long time,” Mr. Marcos said, adding that “allies” are not exempt from the upcoming review of projects.

“Someone must be held accountable for the hardships our fellow citizens are going through.”

And, all of a sudden, we see a couple of local governments saying that they are looking at terminating delayed drainage projects.

But that’s just it, Mr. President: it will be difficult to believe that this anti-corruption drive is genuine unless we see at least one prominent high-ranking/influential suspect —  especially if allied with your administration and not just because he/she is a critic — charged, tried, convicted, and thrown in jail… not just some glorified gofer who will stand in as a convenient scapegoat.

PAVING THE ROAD AHEAD
To be fair, leaders of both chambers of Congress promptly moved to open to public and civil society scrutiny opaque legislative procedures that tweak the annual national budget submitted by the Executive. This initiative will focus on (well, hopefully) scrapping the ad hoc “small committee” (composed of only four lawmakers) that works on post-second reading approval insertions (that could drastically change the second-reading version without the knowledge of many lawmakers before they vote on third and final reading) and the bicameral conference committee that is designed only to harmonize conflicting details of versions of the Senate and the House of Representatives but which, in practice, acts virtually as a third chamber that could introduce new provisions absent from either version.

But what else?

Any major reform can always be reversed on a whim of those in power if it is not institutionalized in a law. Let’s pick just a handful from past priority lists of Malacañang and of business chambers that — perhaps due to legislative inaction across Congresses — have disappeared from their latest targets.

1.) Enact a freedom of information (FoI) law.

Such a law would be an indispensable tool of any move to exact accountability of government officials, since it crowd-sources efforts in this drive.

Thus, I still recall how hopeful those in media, civil society, and business felt when former President Rodrigo R. Duterte issued as his second executive order an FoI program covering the Executive branch. But that signal was diluted as Malacañang later added exceptions and the Office of the Ombudsman at that time restricted access to officials’ annual statements of assets, liabilities and net worth (SALNs). Not to mention that journalists had complained of cumbersome processes apparently meant to thwart their inquiries.

In a July 14 statement1 signed by some framers of the 1987 Constitution, civil society groups, journalists, and members of the academe, and issued in time for the latest SONA, the Right to Know, Right Now! Coalition (R2KRN) — which has pushed FoI legislation for the last 25 years across six presidencies and nine Congresses (11th to 19th) — noted that while Mr. Marcos has never included FoI in his SONAs (including the latest one), two draft bills have been circulating since April from the Department of Budget and Management (the lead agency of the Philippine Open Government Partnership) and from the Presidential Communications Office’s Freedom of Information-Program Management Office.2

ML Party-list Rep. Leila M. De Lima notes that it has been 30 years since the first FoI bill was filed. An FoI bill came close to becoming law in the 14th Congress during the presidency of Gloria M. Arroyo (now Pampanga 2nd district representative) when both chambers approved it on final reading, but the House failed to ratify it due to a lack of quorum on the last session day.3

R2KRN said that any FoI law should clarify and limit exceptions; emphasize pro-active disclosure of public officials as a duty; institutionalize permanent, effective oversight; and exclude riders or amendments that could stymie freedom of expression or non-retaliatory use of information by the public.

This just-opened Congress has seen new FoI bills filed, namely: House Bill No. 2897, authored by Reps. De Lima, Edgar R. Erice (Caloocan City, 2nd District), Adrian Michael A. Amatong (Zamboanga del Norte, 3rd District), Arlene J. Bag-ao (Dinagat Islands, Lone District), Jaime D. Fresnedi (Muntinlupa City, Lone District), Cielo Krisel B. Lagman (Albay, 1st District) and Alfonso V. Umali, Jr. (Oriental Mindoro, 2nd District), and Senate Bill No. 720, filed by Sen. Francis N. Pangilinan.

HB 2897, among others, stresses the obligation of government agencies and public officials to disclose and allow scrutiny of information on official acts, transactions, decisions, and research data for policies; would require them to provide a clear process for submitting FoI requests and a status dashboard; and provides a clear timetable for action.

SB 720 — which will cover the Executive, Legislative, and Judicial branches, constitutional commissions and constitutionally mandated bodies, local governments, chartered institutions, government-owned or -controlled corporations (GOCCs), as well as state universities and colleges — provides “a legal presumption in favor of access to information,” with the burden of proof that the information requested is exempted from disclosure falling on state offices subjected to the request. Documents covered include SALNs of the President, Vice-President, members of the Cabinet, members of Congress, Supreme Court justices, members of Constitutional Commissions and other constitutional offices, and Armed Forces generals. Government agencies must also regularly upload on their websites information like their annual budgets, itemized monthly collections and disbursements, summaries of income and expenditures, Internal Revenue Allotment use, annual procurement plans and lists, updated plantilla of positions, loans, bids, and contracts, etc.4

2) Relax bank secrecy

Both chambers have also seen bills filed to relax restrictions on access to bank accounts under Republic Act No. 1405, or the Law on Secrecy of Bank Deposits, that was enacted in 1955. Authors have noted that while the law was originally meant to encourage the public to invest their money in government securities and open and maintain bank deposits, it is now used by criminals to hide proof of financial crimes like money laundering, tax evasion, and corruption.

There are two other relevant laws, namely: RA 6426, or the Foreign Currency Deposits Act of the Philippines (1972), and RA 8367, or the Revised Non-Stock Savings and Loan Associations Act of 1997, but these 20th Congress bills did not touch them.

In a 2024 primer, the Bangko Sentral ng Pilipinas (BSP) said that the International Monetary Fund had noted that “the existing secrecy of bank deposits laws of the Philippines restrict the ability of the Bangko Sentral to undertake effective supervision.” The BSP added that “[t]he language of existing laws on bank secrecy makes the Philippines the only country to still have restrictive bank secrecy policy, making it hard for the government to go after tax evaders and money launderers. This, notwithstanding the global trend to shift from secrecy to transparency.”5

HB 7 — filed by Speaker Ferdinand Martin G. Romualdez, as well as Tingong Party-list Reps. Jude A. Acidre and Andrew Julian K. Romualdez — will allow the BSP to examine bank deposits (including foreign currency accounts) under strict conditions when there is “reasonable suspicion of unlawful activity.”6 This bill allows the BSP to examine deposits when the Monetary Board finds reasonable ground to suspect fraud or financial misconduct involving bank officials, stockholders, employees, or those connected to entities under BSP supervision. It also covers investigations of closed banks and includes foreign currency accounts, except those in member-based thrift associations. In order to prevent abuse, the same bill provides that the BSP can share any findings only with the Anti-Money Laundering Council, the Securities and Exchange Commission, the Philippine Deposit Insurance Corp., the Justice department, or the courts, and only when legally necessary. Moreover, no bank officer or employee can be held liable for good-faith compliance, and unauthorized disclosure of any information will be met with stiff penalties.

SB 150, filed by Mr. Zubiri, seeks to exclude government officials (whether elected or appointed, including those in GOCCs and the uniformed services) and employees from the prohibition against disclosure of or inquiry into bank deposits. Exclusion from bank secrecy will include foreign currency deposits in Philippine banks operating in the Philippines as well as foreign banks operating in the Philippines and deposit substitutes.7

3.) Finally, of course, how can we forget a long-desired law that would operationalize the Constitution’s ban on political dynasties?

Such a law has remained elusive for the longest time, but remember that rules for elections in both the Bangsamoro Autonomous Region in Muslim Mindanao and the Sangguniang Kabataan contain anti-dynasty provisions, so maybe there is some hope for such a ban for the entire country.

Mr. Pangilinan has filed a Senate bill (unnumbered as of July 18) that seeks to ban individuals related within the second degree of consanguinity or affinity from holding or running for public office simultaneously at the national and local levels, down to barangay captain.8 In the House, Reps. Antonio L. Tinio (ACT Teachers Party-list) and Renee Louise M. Co (Kabataan Party-list) have filed HB 209, which would bar those within up to the fourth degree of consanguinity or affinity (hence, including first cousins, great aunts and uncles, grandnieces and nephews, and in-laws) from running for or from holding public office simultaneously.9

But while we await any action on these bills, Senate President Francis G. Escudero has provided an alternative in SB 783 that will ban public officials and their relatives up to the fourth degree of consanguinity or affinity from entering into government contracts. These individuals must also cease acting as contractors or suppliers, particularly in flood control and other infrastructure projects. SB 783 builds on RA 12009, or the New Government Procurement Act, as it aims to spare from undue influence “transactions involving supplies, infrastructure, joint ventures, and public-private partnerships, except those deemed highly technical, proprietary, or confidential.”10

Those measures are what come immediately to mind if we are to make sure that any anti-graft and -corruption drive can be sustained, i.e., that Mr. Marcos’s pronouncements on this matter are not a mere shot across the bow. I am sure readers will have their own lists.

And in order to ensure that Malacañang and Congress are on the same page when it comes to priority reforms, let’s resume regular, i.e., quarterly at least, meetings of the Legislative Executive Development Advisory Council that, in the past, have always helped prompt the enactment of such measures needed by the economy as we slug it out in an increasingly competitive regional and global environment (not to mention to make sure that economic expansion lifts many more Filipinos out of poverty).

Coz as things stand, I am sure that ordinary citizens are watching this issue with a dose of skepticism.

So surprise us. Prove us wrong.

1 https://tinyurl.com/249cxvmp

2 https://tinyurl.com/23aqf2d2

3 https://tinyurl.com/2ygtdmca

4 https://tinyurl.com/27r3e8zq

5 IMF Country Report No. 20/296, Financial Sector Assessment Program, Philippines, October 2020, as cited in https://www.bsp.gov.ph/Media_and_Research/Primers%20Faqs/Primer_on_Bank_Secrecy.pdf

6 https://tinyurl.com/23p2oy97

7 https://web.senate.gov.ph/lisdata/4662742631!.pdf

8 https://tinyurl.com/28gn8yjs

https://web.senate.gov.ph/lisdata/4662742631!.pdf

9 https://tinyurl.com/2adoo9z5

10 https://tinyurl.com/288hzn9k

Wilfredo G. Reyes was editor-in-chief of BusinessWorld from 2020 through 2023.