Neri Colmenares for Senator: A vote of protest and hope

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From the Neri for Senator Movement Facebook page

The Filipino family is under attack – from profit-seeking corporations bent on squeezing them dry for every kilowatt of electricity they use, for every cubic meter of water they consume, for every kilometer that they travel, for every unwanted trip to the hospital. Add to these the onerous taxes that put added pressure on already tight family budgets even as state support and services are lacking. Trapos running in the elections vow to address the people’s poverty as they always do every three years. But the people already know that the government of trapos has long abandoned them and that they are left to fend for themselves.

The good news, however, is that there are candidates like Neri Colmenares, who is seeking a Senate seat, that Filipino families continually oppressed by rising cost of living can truly rely on.

Government policies are always biased against ordinary income earners. Public utilities like power, water, and mass transport (LRT/MRT), as well as basic social services like education, health, and housing are being turned over to big business through privatization or public-private partnerships (PPP) resulting in exorbitant fees. This has been the case for more than three decades now under what is called the neoliberal framework in managing the economy and running the government. Neoliberalism basically means that corporate profits are more important than the people’s welfare. Aquino’s “Daang Matuwid” was all about this anti-people, pro-business neoliberal agenda, while appeasing the poorest with dole outs through conditional cash transfers (CCT).

If people want to stop the ever-rising costs of public utilities and push for sufficient basic services from government, the neoliberal onslaught has to end. Protests and other direct mass actions have always been an effective way to challenge and reverse the oppressive neoliberal policies that the Aquino and previous administrations have imposed on the people. But having progressive and non-trapo voices in Congress could also help advance the call for policy reforms to stem the neoliberal attack against the welfare of common Filipino households.

Neri Colmenares, the congressman of Bayan Muna and now a senatorial candidate, is one of the few voices that unfailingly articulated the people’s issues and demands in a House of Representatives ruled by political dynasties and the elite. The trapos simply do not have the interest to change the neoliberal policies that benefit them (including through kickbacks) and/or their billionaire patrons from big business that get richer via lucrative PPP contracts or from high electricity rates. In contrast, Colmenares has always been an activist – from his student days when he joined the struggle against the Marcos dictatorship that detained and tortured him up to the time when he became a human rights lawyer and then a representative of Bayan Muna in Congress starting in 2009. As an activist, he has always sided with people and opposed the abuses and unjust policies of those in power and the profit-seeking interests that they represent.

His track record as a legislator shows why he is the “Fighter ng Bayan”. He exposed and opposed, for instance, the unjust and massive hikes in electricity rates due to manipulation and collusion by big corporations under a privatized and deregulated power industry. Remember when the Manila Electric Co. (Meralco) – with the approval of government regulators – once tried to implement a staggering P4.15 per kilowatt-hour (kWh) increase in electricity rates more than two years ago? If not for the prompt intervention in Congress and the Supreme Court (SC) by Colmenares and his fellow progressive partylist lawmakers from the Makabayan bloc along with militant people’s protests, Meralco and other power companies would have gotten away with murder again.

Among the more recent legislative proposals that Colmenares strongly pushed for is the reform in the country’s regressive income tax system wherein currently those who have a monthly pay of P50,000 are charged with the same personal income tax rate as the big bosses and owners of the country’s largest corporations. He also worked hard to legislate – and almost succeeded – the P2,000-increase in the monthly pension of members of the Social Security System (SSS). Alas, the neoliberal Daang Matuwid of the Aquino regime thwarted these efforts to provide much needed relief to the people amid rising cost of living with the President even vetoing the already passed law on SSS pension hike. (Read “Colmenares on Senate agenda”)

Before Congress took a break for the May 2016 elections, Aquino’s people in the House tried to railroad the PPP Act, which, consistent with the neoliberal agenda, would have given greater perks, profit guarantees and investment protection for the local oligarchs and their foreign backers and partners that participate in the PPP program – all at the expense of the taxpayers and the general public. But Colmenares, raising constitutional issues, successfully blocked the PPP Act and the House leadership was forced to delay its passage.

Electricity bills and other regular household expenses will continue to rise even as government systematically abandons its duty to ensure that basic social services are delivered to the people. After the elections, LRT fares and water rates are scheduled to rise as guaranteed by government’s PPP contracts with big business even as there’s no guarantee that wages will increase. The neoliberal onslaught will march on while ordinary families struggle to keep up with the ever-rising cost of living amid lack of state support and protection.

Among those running for the Senate, only Neri Colmenares has the proven track record in fighting neoliberalism and the hardships that it inflicts on the people. With him, the people are assured that they have a reliable Senator who will always stand up for and never compromise their rights, interests and welfare.

A vote for Colmenares is a vote of protest and hope – protest against the system that has oppressed and abandoned the people in favor of corporations and hope that the people can fight back and actually win. ###

Profit-driven, foreign interests made Aquino President; is Mar Roxas next?

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Photo from arabnews.com

Recent pre-election surveys show that administration and Liberal Party (LP) bet Mar Roxas supposedly gaining ground after consistently lagging behind in previous surveys. One dubious research firm even claims that Roxas is the new man to beat. There is apparently a campaign to condition the public mind that a Roxas victory is not far-fetched after all. Roxas himself declared that “It’s my time to top the surveys.”

LP desperately intends to stay in power and Mar Roxas wants to be the next Philippine President at all costs, and an election controlled by profit-driven, foreign interests could help ensure that they do.

Former Commission on Election (Comelec) chair Sixto Brillantes recently admitted that it was the UK-based, private company Smartmatic Inc. that practically ran the 2010 national and local elections and not the poll body.

“If we were to review what happened in the 2010 first automated elections, one will realize that the Comelec then was most dependent on Smartmatic such that it was Smartmatic that practically ran the entire elections, not Comelec,” Brillantes was quoted as saying.

The ex-poll chief’s admission affirms what critics of the automated election system (AES) being implemented by the Comelec have been saying all along. An unaccountable foreign business has monopoly control over our elections, which is supposedly an expression of our democracy and sovereignty as a people.

Smartmatic was also in command of the 2013 midterm elections and will continue to play such role for the upcoming polls on May 9. It maintained its monopoly control over Philippine elections through its automation technology, the contracts it bagged with the Comelec as well as the support and other services that it will provide.

Various factions of the ruling elite aggressively vie for state power during elections not to the serve the people and develop the nation. Traditional politicians and their backers from big business and foreign interests compete for control over the state machinery out of the need to protect and advance their own political and economic interests. It is this intense and never-ending struggle for power and wealth and contradiction within the ruling elite that explain the massive spending (including of public resources) and perennial violence and fraud characterizing Philippine elections.

Put in this context and reality, a private and foreign company like Smartmatic taking over the conduct of the elections takes the subversion of the people’s sovereignty to a whole new level and makes it much easier for contending factions with vested interests to cheat. Whoever has ties – or has the resources to bid the highest – with Smartmatic can buy electoral victory.

Among the groups of the political and economic elite competing for power in the elections next week, it is the LP clique and its candidates led by presidential bet Roxas that have not only the biggest motivation (stay in power, avoid prosecution) and deepest electoral war chest (people’s money), but also the closest links with Smartmatic (through the Aquino family’s ties with Smarmatic chairman Lord Mark Malloch-Brown). Smartmatic installed Aquino as the country’s first AES President in 2010; it certainly has the capacity to do it again for Roxas.

Smartmatic-Comelec contracts

For the upcoming polls, Smartmatic is once again supplying the Comelec with VCM as it continues its profitable partnership with the poll body that started with the PCOS deals in 2010 and 2013. The Comelec is leasing a total of 97,517 VCMs from Smartmatic for about Php8.03 billion. In 2010, Smartmatic leased to the poll body 84,000 PCOS machines for Php7.2 billion. In 2013, Comelec purchased from Smartmatic some 82,000 PCOS machines for Php1.8 billion. Thus, Smartmatic has already bagged more than Php17 billion from its PCOS/VCM transactions with the Comelec for the past three elections, including the one on May 9.

Aside from the poll machines, Smartmatic also cornered contracts with the Comelec for other services. For the upcoming polls, Smartmatic is providing as well the Php558-million election results transmission services (ERTS). Smartmatic was able to corner the same contract in 2013 then worth Php405.4 million. Other contracts Smartmatic bagged in 2013 are the P154.5-million transmission modems; the P46.5-million compact flash (CF) cards main; and the P46.5-million CF cards worm. Comelec also purchased the canvassing and consolidation system (CCS) from Smartmatic in 2013 for Php36.6 million.

The privatization of Philippine elections covers not only the hardware and software for the automated polls; technical support to troubleshoot and address glitches is also controlled by Smartmatic. For the 2016 elections, Smartmatic bagged the Php122-million contract to set up a National Technical Support Center (NTSC) as a call center and troubleshooter for the elections. It was also Smartmatic that cornered the NTSC contract for the 2013 polls worth Php111.56 million.

All in all, the Smartmatic-Comelec contracts are worth well above Php18 billion as summarized in the table below. Note that the table is just a partial, incomplete list as it merely relied on data from various news reports.

Partial list of contracts bagged by Smartmatic in PH elections (in Php million)
Item 2010 2013 2016 Total
PCOS/VCM 7,200 1,800 8,030 17,030
Election Results Transmission Services 405.4 558 963.4
Transmission modems 154.5 154.5
Compact flash cards 93 93
National Technical Support Center 111.56 122 233.56
Total 7,200 2,564.46 8,710 18,474.46
Culled from various media reports

Why Smartmatic keeps on winning Comelec contracts boggles the mind especially considering the numerous and major malfunctions by the machines and services that Smartmatic provided in the past two elections. To illustrate, while the AES law mandates a 99.995% accuracy rate, Smartmatic’s PCOS machines registered a 99.6% rate in 2010 and 99.98% in 2013. These translate to hundreds of thousands of miscounted ballots and undermine the credibility of the election results. Further, Smartmatic’s ERTS is supposed to reach 100% transmission rate within 24 hours. But in 2013, it was able to achieve a mere 76% transmission rate when Comelec started declaring winners.

There have been allegations of rigged bidding to favor Smartmatic such as designing contracts where only Smartmatic can qualify or omitting requirements that will otherwise disqualify Smartmatic, a company tainted with various controversies even before it started its lucrative business here in the Philippines. For the upcoming elections’ bidding for PCOS/VCM, for instance, Comelec required that only those that can supply both the election management system and the machines could bid (which only fits Smartmatic) and that ongoing legal cases (which Smartmatic has arising from past electoral protests) should not prohibit bidders to participate. There were also similar complaints during the 2013 elections such as in the supply of CF cards. A competitor lost because its CF cards don’t work with Smartmatic’s PCOS machines as the latter refused to declare the machines’ technical requirements, which Smartmatic claimed is proprietary information.

But why does the Comelec so heavily favor Smartmatic, allowing it to monopolize the entire automated election system? One possible explanation is the political connections of Smartmatic with groups that have an interest in securing electoral victory. Smartmatic’s chairman, British Lord Mark Malloch-Brown, was the late President Cory Aquino’s campaign strategist during the 1986 snap elections (some accounts claim that Malloch-Brown’s group then – the Sawyer-Miller consultancy firm – was assigned by the US Central Intelligence Agency or CIA to Cory’s camp). In an interview with the Philippine Daily Inquirer during his visit here in June last year, Malloch-Brown claimed that his “final outstanding accomplishment during the Cory campaign was to produce an exit poll that indicated that she had won”. Malloch-Brown has supposedly developed a close relationship with the Aquino family and there were reports that he met with Cory’s son President Benigno Aquino III and other politicians during his visit in the Philippines last year. Malloch-Brown, however denied this, apparently mindful of repercussions in public perception.

Nonetheless, the presence of Malloch-Brown, a foreigner who made a career out of influencing elections in supposedly sovereign countries and strategizing for client political elites, in a private company that runs our elections is a big red flag. It further underscores the dangers of privatizing elections that have been perpetually marred by massive fraud even before automation.

The failure of the current AES technology to reach minimum standards set by the law means that election results could not be relied upon. At best, they could just be the result of glitches caused by machine/software and human errors. At worst, they point to the planned manipulation of poll results by those who have access to the election technology or have ties with the private and foreign interests that control the technology. Both in 2010 and 2013, allegations of electronic fraud were widespread ranging from supposedly altered results being transmitted by the PCOS machines to pre-programming of results such as the so-called “60-30-10” pattern (60% of votes for administration bets; 30% for opposition; and 10% for other candidates) during the midterm senatorial election.

It doesn’t help that another seemingly favored private, foreign company is also controlling the conduct of the source code review, a supposed safeguard under the AES law that scrutinizes the software to be used by the voting machines and by the canvassing and consolidation system. For the May 2016 elections, US-based SLI Global Solutions Inc. (formerly Systest Labs Inc.) is carrying out the source code review for Php35 million as it did in 2010 and 2013.

Undermining democracy and sovereignty

To be sure, the flaws of the country’s electoral system go beyond the issue of conducting it manually or electronically. Whether manual or electronic, elections will remain undemocratic as long as the people are left to choose among the same contending factions of the political and economic elite. And these groups and families vying for control of state power in order to advance the economic and political interests they represent will continue to find ways to subvert the elections through direct cheating, political patronage and/or violence and terrorism.

But these fundamental problems of the electoral system are further worsened by allowing private and foreign companies through the technology they own to control the entire electoral process – from reading and recording of ballots to the canvassing of results. Even for the technical support, troubleshooting, installation of system, training of staff, etc., the Comelec is completely dependent on a private, foreign company.

While modernizing the way the country conducts its elections with the use of appropriate technology founded on the principles of transparency and credibility is the right step to take, the AES that the Comelec has been implementing since 2010 is further undermining election as a democratic exercise and an expression of the people’s sovereignty. ###

(Portions of this article were lifted from an article I wrote for IBON Features)

5 reasons why workers will reject “Daang Matuwid” in the May elections

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Photo from gettyimages.com

The “Daang Matuwid” regime of outgoing President Benigno Aquino III, which Liberal Party (LP) standard bearer Secretary Mar Roxas vows to continue, has been notoriously anti-worker throughout its six-year rule. Below are five reasons why Filipino workers will overwhelmingly reject the “Daang Matuwid” regime in the upcoming May 9 elections:

  1. Daang Matuwid opposed any meaningful increase in the daily minimum wage and further cheapened the already low wages of workers

Daang Matuwid has consistently opposed proposals for a substantial wage hike. Since 2010, the daily minimum wage in the Philippines has only increased by Php13 (Ilocos Region or Region I) to Php77 (National Capital Region or NCR). These adjustments are insignificant amid the soaring cost of living. For instance, in NCR where the minimum wage is the highest and which also posted the largest wage hike among all regions, the estimated cost of living jumped by more than Php114 during the same period, easily offsetting the Php77-adjustment in the minimum wage. Consequently, the already big gap between the daily minimum wage and the daily cost of living has even furthered widened under Daang Matuwid – from Php571 in 2010 to about Php608 today. This means that the capacity of workers and their families to meet basic food and non-food needs has been further eroded.

Worse, instead of a substantial wage increase, Daang Matuwid introduced the so-called two-tiered wage system that provided capitalists another tool in pressing down the pay of their workers. Under the two-tiered wage system, companies will give workers a basic floor wage, which is computed above the official poverty threshold but below the existing average pay. Employers can then voluntarily increase the basic floor wage depending on their own computation of the workers’ productivity. Such system means greater abandonment of government of its obligation to set wages that would allow workers and their families to achieve decent living while giving profit-seeking firms more freedom to exploit the workers.

  1. Daang Matuwid worsened the burden of workers with onerous taxes

Daang Matuwid oppressed Filipino workers with onerous taxes. Compared to other countries in Southeast Asia, the Philippines has the highest rates for income tax (5-32%) and for the value-added tax or VAT (12%). The tax system is so oppressive that that those earning about Php50,000 a month pay the same tax rate of 32% as the billionaires who own and run the country’s biggest conglomerates. Meanwhile, the regressive 12% VAT punishes the ordinary income earners as even the most basic goods and services are covered including water, electricity and petroleum products, which all directly impact on the standard of living and inflate the cost of other commodities.

There have been several proposals in Congress to correct this injustice but were rejected by the Daang Matuwid regime, dismissing them as populist and impractical measures. “Kung papogihan lang ito, wag na tayong mag-income tax,” Mar Roxas was quoted as saying. But the issue, of course, is much deeper than “papogihan” as a progressive tax reform system will allow a just distribution of wealth, help improve the living condition of many, and spur economic growth driven by domestic spending.

Another additional tax burden imposed on Filipino workers by Daang Matuwid is the so-called sin tax on alcohol and tobacco products. Guised as a measure to supposedly address health concerns caused by smoking and drinking (even as the national health budget remains grossly inadequate, state hospitals are being privatized, and poverty-related illnesses remain widespread amid low wages/incomes and lack of jobs), the sin tax in reality is primarily aimed at raising government revenues at the expense of ordinary income earners.

  1. Daang Matuwid rejected calls to increase the limited benefits enjoyed by workers such as their SSS pension

Just early this year, President Aquino vetoed the bill hiking the monthly pension (which has been at a paltry Php1,200 for almost two decades now) of 2.1 million members of the Social Security System (SSS). The Daang Matuwid regime justified its heartless decision by claiming that the SSS might go bankrupt if the proposed Php2,000-pension hike is implemented.

But as proponents of the pension hike led by Bayan Muna Rep. and Makabayan senatorial bet Neri Colmenares pointed out, SSS can avoid bankruptcy if it will improve its collection efficiency that currently stands at a dismal 35-38% (including an uncollected amount of Php13 billion as of 2014) and cut back questionable expenses such as massive bonuses for its board members (e.g. Php200 million in retirement package). The administrative cost of SSS at almost 7% of contributions is too high compared to other countries (e.g. Singapore’s 0.5% or Malaysia’s 2%). By stoking bankruptcy fears, the Daang Matuwid regime is also oblivious to its legally mandated obligation to replenish the SSS should it incur a deficit arising from the pension hike.

For the elderly workers, the Php2,000-pension hike means duly recognizing their contribution not only to the SSS fund but to the national economy while promoting their capacity to support themselves in their retirement.

  1. Daang Matuwid failed to address the jobs crisis and to promote the job security of workers

The Daang Matuwid regime would want us to believe that the jobs situation has improved under its watch. But nothing could be farther from the truth. While 692,000 jobs a year appear to have been created between 2010 and 2015, almost 7 out of 10 of the additional jobs were made in hotels, restaurants, call centers, malls, and other less productive sectors as well as in highly seasonal, contractual work like construction. In addition, research group IBON Foundation noted that job creation under Daang Matuwid is much weaker compared to previous years. Between 2000 and 2009, for instance, 732,000 jobs were created annually.

Chronic job scarcity is being concealed by distorted official employment data as government labor surveys tend to exclude jobless workers who have already been discouraged by lack of employment opportunities. Including such workers, IBON estimates that unemployment rate remains at double-digit with more than 4 million jobless workers today – or basically the same as the situation before Daang Matuwid took over.

A separate survey by the Social Weather Stations (SWS), on the other hand, shows that the number of jobless actually increased from an average of 9.5 million in 2010 to 9.8 million in 2015.

Also, four out of 10 workers are own-account and unpaid family workers that further illustrate the low quality of jobs in the country. Job insecurity, meanwhile, remains severe. IBON estimated that four out of 10 rank and file workers are in non-regular work – e.g., contractual, probationary, casual, seasonal, apprentice workers or agency-hired.

  1. Daang Matuwid continued neoliberal policies like PPP that resulted in higher prices and fees

Daang Matuwid’s centerpiece economic program – the public-private partnership (PPP) – is a continuation, expansion and deepening of the same neoliberal privatization policy started by the first Aquino administration in the 1980s. Under PPP, fares in the LRT 1 and 2 and MRT 3 have jumped by as much Php10 to 13. Among the most affected are the workers/employees and job seekers who comprise about 59% of LRT and MRT commuters. Another 32% are students mostly from working class families.

While the Daang Matuwid has vehemently opposed substantial wage hike, increase in SSS pension, and reduction in taxes, it has showered with generous perks the billionaire oligarchs who cornered PPP contracts. Under the LRT 1 PPP deal, for instance, the Daang Matuwid regime has given enormous benefits to the consortium of Ayala Corp. and the Manny Pangilinan group. Of the total project cost of Php64.9 billion, Daang Matuwid made the public shoulder Php34.9 billion or 54% of the total. Government share includes expenses for right of way acquisition, purchase of additional coaches, civil works and construction of depots. The Ayala-Pangilinan group also enjoys real property tax exemptions reportedly costing Php64 billion. ###

On presidential chopper and taxes: An open letter to Kris Aquino

 

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From Kris Aquino’s Instagram account

Dear Kris,

Echoing your Kuya Noy’s absurd argument to justify that notorious presidential chopper ride you took to campaign for Mar Roxas, you bragged the 322 million pesos in taxes that you paid in the past seven years.

You reminded us that you’re consistently among the top individual taxpayers in the country. I will not argue against the amount of money you contributed to public coffers. But let me respond to your outrageous entitlement complex.

First, the huge taxes that you paid don’t justify your blatantly illegal use of public resources to campaign for Kuya Noy’s candidates. It is plainly against the law (i.e. Omnibus Election Code). Unless your entitlement complex makes you think that you have 322 million valid reasons to do so.

Unless because you think that the Filipino people owe you and your family so much – you never fail to remind the public that your dad and mom (and now, Kuya Noy, too) had sacrificed so much for our country, that it is like the people’s “utang na loob” to the Aquinos our so-called democracy – that you are above the law.

Well, you are not. And we don’t owe you anything. Not the taxes that you pay, which are your legal obligations, and certainly not the fake democracy that massacres farmers in Mendiola and Hacienda Luisita.

Second, hindi lang ikaw ang nagbabayad ng buwis. Certainly, with your enormous wealth thanks to a lucrative showbiz career and Hacienda Luisita exploitation, you pay multiple times more than the impoverished workers in your hacienda and your TV production crew in terms of absolute pesos. But accounting for taxes paid should not work that way. What you and the oligarchs and their CEOs pay in taxes, hundreds of millions as they are, are actually peanuts relative to what you earn.

But for the ordinary wage earners, the daily MRT commuters, the taxes that they pay take away a big portion of what they get to bring home to their families.

The minimum wage in Metro Manila is just 481 pesos per day and the estimated amount needed to live decently in the capital is more than 1,000 pesos per day per family. A sugar plantation worker I have recently talked to said that their take home pay is just 150 pesos a day, which he said is just barely enough for their daily rice consumption.

And government squeezes taxes from them – whether through their income or their spending (like VAT). Worse, the super rich folks you rub elbow with, they pay the same income tax rate as those ordinary managers and supervisors. Your Kuya Noy vehemently opposed moves to correct this grave injustice.

Which brings me to my third point – these ordinary people, especially those who live hand-to-mouth, those who your Kuya Noy and his government squeeze dry for taxes, they are the ones who should be entitled – no, have the right – to more public resources.

Unlike you, they do not ask for a chopper ride so they won’t have to “walk three kilometers” to attend a Liberal Party sortie. What they ask for are rather simple and very basic services that the government should have been providing. You know, like public education, health services, decent housing or agricultural support.

Do you read the news, not only those that are favorable to Kuya Noy? Do you remember, or even know, Kristel Tejada? She was 16 years old. She committed suicide because she could not enroll at UP for an unpaid tuition of Php 10,000.

Do you know Ariel Leonor? He was 21 years old. He was shot dead by the police during the violent demolition of their poor community of about 25,000 families in Silverio Compound, Parañaque City.

Do you know Darwin Sulang? He was 22 years old. He was one of the two killed when the police opened fire at the farmers’ barricade in Kidapawan City. They were asking for rice because drought destroyed their crops and they have literally nothing to eat.

O, before you blame Gloria Arroyo, all these happened under your Kuya Noy’s watch. Kidapawan was like just three weeks ago, in case you missed it.

You see Kris, these young people died because your Kuya Noy’s government, which should have been providing basic services and assistance to the poor – not from your family’s massive wealth but from the taxes that the people (and not only you) pay – has abandoned them.

And you have the gall to justify your illegal chopper ride because you pay taxes? ###

#BeyondElections2016: PPP investors bet on presidential bets

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Infographic from IBON Foundation

All presidential bets vow that they will continue and improve the public-private partnership program (PPP) of the Aquino administration. This, of course, is not a surprise. Oligarchs who bag these contracts and profit from infrastructure development are also the biggest backers of leading presidential bets.

Take San Miguel Corporation, for example. The diversified conglomerate admitted that it has been lending its private jets to some 2016 bets for their campaigning. SMC has already cornered four PPP contracts worth more than Php49 billion.

These include the Php24.4-billion Bulacan Bulk Water Supply Project and Php17.93-billion NAIA Expressway Phase 2 Project under the Aquino administration; and the Php69.3-billion MRT Line 7 Project and Php37.43-billion Metro Manila Skyway Stage 3 Project under the previous Arroyo administration.

San Miguel is eyeing another Php489.58 billion worth of PPP projects, which may be auctioned in the remaining months of the Aquino presidency or early on in the administration of the next President.

It’s how bureaucrat capitalism works. Oligarchs back presidential bids as “investment” and rake profits later through government contracts such as PPPs.

This reality is prominent in the upcoming polls as candidates assure investors, including foreign interests behind privatized infrastructure development, of PPP continuity. The only competition now is who among the presidential contenders will implement most efficiently the incumbent’s centerpiece economic program.

PPP delays

Opposition bets use the horrendous traffic in Metro Manila amid delayed transportation projects to stress the failures of the Aquino administration. Vice President Jejomar Binay, for instance, calls Aquino’s PPP program as “epicenter of failure”. For the aspirant who poll surveys say is the man to beat, the main issue is the “inexplicable delays” in the PPP program.

So far, Aquino has already awarded 12 PPP projects with a combined cost of Php196.53 billion. The amount is based on the PPP Center’s report as of 1 April 2016.

But out of the 12 awarded contracts, government has completed just two projects. These are the Php2.01-billion Daang Hari – SLEX Link Road Project and the Php16.43-billion PPP for School Infrastructure Project (PSIP) Phase I. One of the awarded contracts – the Php8.69-billion Modernization of the Philippine Orthopedic Center – even got derailed. This after the investor backed out citing delays in the release of certificate of possession for the project site.

Presidential bets promise to fast track the implementation of the PPP program. One is Senator Grace Poe who is neck and neck with Binay in the surveys. Poe claimed that when elected, she would finish seven airports through PPP in the first half of her term. These airport projects are in various stages of bidding under Aquino’s PPP program.

Poll uncertainties

Candidates are pressed to have greater clarity in their economic plans especially on PPP to assure interest groups like banks and investors. The Institute of International Finance (IIF), for example, said that compared to Poe and administration bet Mar Roxas, Binay is more populist. Thus, Binay could undermine the PPP program.

Responding to the US-based lobby group, the Vice President’s camp asserted they would, in fact, enhance the PPP program. A Binay presidency, they said, will revise the Build-Operate-Transfer (BOT) Law, pass a Right-of-Way bill, and address bureaucratic inefficiencies to hasten PPP implementation.

Indeed, the PPP program’s fate is one of the main concerns of the business community as the country transitions from the current administration to the next. For instance, the Philippine Chamber of Commerce and Industry (PCCI) asked Aquino to accelerate the implementation of PPP projects in the remainder of his term. PCCI said this will ensure that the next President can “hit the ground running” in terms of infrastructure development.

But the business community is also wary of political risks. Historically, pet infrastructure projects of the incumbent administration, when replaced by the opposing camp, are either delayed or totally scrapped. This early, the American Chamber of Commerce of the Philippines is urging the succeeding regime to continue “all properly awarded” PPP projects.

Contracts are often reviewed supposedly to protect public interest. In reality, however, the intention is to favor other business interests that have closer ties to the newly installed political camp.

The LRT-MRT common station controversy is illustrative of this. The common station was originally located near Henry Sy’s SM City – North EDSA in a deal forged during the Arroyo administration. It was part of the Php69.3-billion MRT Line 7 Project. But when Aquino took over, the station was moved to the TriNoma mall of the Ayala group, bundled with the LRT 1 project.

Assuring investors

Nonetheless, investors are practically assured of the PPP program’s continuity even with Aquino bet Roxas lagging behind in surveys. For one, PPP projects are exempted from the poll ban on public works, said the Commission on Elections (Comelec). This means that scheduled bidding of some projects will proceed as planned. The PPP Center targets to award at least three more contracts before Aquino steps down.

Further, top presidential runners have already said they would not just continue the program but also improve its execution. All candidates have committed as well to increase infrastructure spending from 4% to 5% of gross domestic product (GDP). This includes the budget to protect PPP investors from political and economic risks.

The administration is also moving to guarantee investors the program will not be easily reversed by whoever will come into power. Aquino already certified as urgent the proposed PPP Law to expedite it in Congress before the polls. The bill would consolidate, institutionalize and expand the PPP reforms started by Aquino, which are feared to undercut public interest. Among them is further weakening public institutions that regulate private investments.

Indeed, the coming election is crucial for PPP investors. The next administration will oversee the implementation of awarded contracts and steering rest of the projects lined up under the program. These include mega-projects such as the Php122.8-billion Laguna Lakeshore Expressway Dike Project and the Php170.7-billion North-South Railway Project (South Line).

Contracts of such magnitude require a government that is able to address regulatory and commercial risks, noted the International Finance Corporation (IFC). The World Bank investment arm also said that greater foreign participation must be encouraged. Thus, foreign and local business groups and creditors are closely watching how contenders will handle PPP issues like regulatory risk guarantees and more liberalization of infrastructure development.

Candidates court ordinary people for votes. However, no one talks about how they will continue to bear an increasing burden to promote the commercial viability of PPP projects. No one is confronting the flawed policy that has raised user fees in water services, power rates, transportation fares, toll fees, telecommunication rates, etc. No one is raising the issue of how privatized infrastructure and services remain dismal amid skyrocketing profits of a handful business groups. ###

(This post is an updated version of the article “Presidential bets vow PPP continuity amid business, foreign lobby” that was first published as IBON Features)

#BigasHindiBala: Beyond bureaucratic neglect and police brutality

Image from Kilusang Magbubukid ng Pilipinas (KMP)

Image from Kilusang Magbubukid ng Pilipinas (KMP)

Long before the drought and the Kidapawan bloodshed, hunger and poverty were already debilitating countless in the countryside.

Along with fishermen (39.2%), poverty incidence is the worst among farmers (38.3%). In Region XII, site of the violence, poverty incidence among farmers is 47.9%, the fifth highest in the country. All cited data are as of 2012, the latest available from the Philippine Statistics Authority (PSA). For comparison, the 2012 national poverty incidence was pegged at 25.2 percent.

It is said that eight out of 10 of the poor in the Philippines are directly or indirectly dependent on farming. As compared to other countries, our rural poverty of nearly 40% is said to be the worst in ASEAN. (Data cited by Rolando T. Dy, 2015)

Farmers earn very little, even without a drought. Palay farmers, for instance, earn at most PHP 60,000 a year – way below the annual rural poverty threshold of PHP 80,000. (Data cited by Ernesto M. Ordoñez, 2014)

Underlying peasant poverty is landlessness. A recent IBON article noted that: “Even the official census could only claim at most 62% of farms under full ownership. The rest are under various forms of land tenure, including tenancy at 15 percent.” The latest Census of Agriculture is 2012.

Note that government’s poverty standards are ridiculously low and its data on land ownership questionable. Rural poverty and landlessness are thus much worse than what official data shows. Nonetheless, even distorted government data could not hide the dire situation that Filipino farmers face.

Aggravating landlessness and all the feudal exploitation it brings are government policies and programs that devastate rural livelihood perhaps in a magnitude much worse than droughts or typhoons. Neoliberal restructuring brought in a flood of cheap agricultural imports that drowned local produce while commercializing vital infrastructure such as irrigation.

So when calamities like drought strike, the already destitute farmers become even more despondent. Meanwhile, government negligence and inefficiency are further highlighted by its incapacity to respond as it has long abandoned its obligation to provide support services like irrigation and subsidies.

All these combine to stir unrest in the countryside that has been long raging. Farmers become fighters in the agrarian revolution being waged by the New People’s Army (NPA). Or they barricade highways to force the powers that be to listen. But for a government of landlords and its armed forces, it makes no difference if you hold an M16 or a placard.

Image from Kilusang Magbubukid ng Pilipinas (KMP)

Image from Kilusang Magbubukid ng Pilipinas (KMP)

The brutal dispersal in Kidapawan reminded us of the repression that farmers face when asserting their most fundamental right to live with dignity. Farmers, in fact, are not only the poorest – they are also the most repressed.

According to human rights group Karapatan, more than 300 cases of extrajudicial killings have been recorded under the Aquino administration. More than 200 of these cases involve farmers.

Before Kidapawan, there was Hacienda Luisita. And before it were Mendiola and Escalante. None have been resolved and the powerful people behind them become presidents and senators, feeding the reign of impunity and terror in the countryside. Some note that President Aquino remains silent on Kidapawan. But what do we really expect a landlord president will say?

All these killings occurred in contexts of struggles and assertion of farmers’ rightful control over land and other resources for production against moneyed investors and landed families. They illustrate that cases of atrocities against farmers like Kidapawan are not isolated incidents but a systematic repression of the people’s dissent by those few who wield power and arms.

Already, the propaganda machine of the landlord regime is at full force in its disinformation and cover up. Propaganda and deception are part of its war against the farmers and the people.

Indeed, the Kidapawan bloodshed is more than bureaucratic neglect as farmers go hungry. It is more than the police violating their own rules of engagement.

It is about the ever-deepening contradiction between the impoverished and starved – the farmers who directly produce food but have nothing to eat, and the landlords and bureaucrats who profit from the people’s poverty and hunger. ###

Image from Kilusang Magbubukid ng Pilipinas (KMP)

Image from Kilusang Magbubukid ng Pilipinas (KMP)

SONA 2015: Favoring the rich, oppressing the poor – Aquino legacy, by the numbers

The LRT 1 privatization, cornered by the Ayala-MVP group, shows how the Aquino regime has favored the oligarchs at the people’s expense. Read more here (Image from Rappler)

One of the biggest legacies that President Benigno S. Aquino III will leave behind is how his regime has favored the rich and oppressed the poor.

Below are some numbers.

  • Php168.9 billion – total cost of the 10 public-private partnership (PPP) projects awarded so far by the Aquino administration (An updated report – as of 22 July 2015 – from the PPP Center now pegs the total cost at Php189 billion, reflecting the Php20.1-billion adjustment in the cost of the Cavite-Laguna Expressway from Php35.4 billion to Php55.5 billion)
  • Php104 billion – total cost of the four projects that the Ayala family and Indonesia’s Salim group, as represented by Manny V. Pangilinan (MVP), have cornered so far under Aquino’s PPP program both as a consortium and as individual proponents (the amount is now Php124.1 billion, reflecting the adjustment in the cost of the Cavite-Laguna Expressway) 
  • Php49 billion – total cost of the five PPP projects under Aquino where Henry Sy is involved
  • Php15.9 billion – cost of the lone PPP contract cornered by presidential uncle Danding Cojuangco’s San Miguel Corp. (SMC) under Aquino’s PPP program
  • Php97 billion – total cost of the two PPP projects of SMC that started with previous administrations but finalized under Aquino

Additional information on these PPP projects here

  • Php57.2 billion – total amount allocated in the 2015 budget to guarantee the profits and other commercial interests of investors participating in Aquino’s PPP program (more details here)
  • Php902.3 billion – total reported contingent liabilities of the Aquino administration arising from state guarantees on commercial debts and subsidies associated with PPP projects (more details here)
  • US$35.6 billion or 237 percent – increase in the combined wealth of the ten richest Filipinos, most of whom are in the PPP business, in 2014 compared to their combined wealth in 2010, as listed by Forbes (more details here and here)
  • 12 – number of Filipinos who landed in Forbes’ 2015 list of billionaires in the world, up from just five billionaires in 2010 (more details here and here)
  • 6th – the global rank of the Philippines in The Economist’s 2014 Crony Capitalism Index, with the billionaires’ wealth in crony-sectors such as utilities and infrastructure comprising about 13 percent of the gross domestic product (GDP); in 2007, the country ranked 9th (more details here)
  • 11.4 million – number of families who consider themselves poor, according to the first quarter 2015 survey of the Social Weather Stations (SWS); in the second quarter 2010 or the start of the Aquino administration, it was pegged at 9.4 million (more details here and here)
  • 7 out of 10 – number of Filipinos who believe that poverty did not go down under the Aquino administration, according to the May 2015 survey of IBON Foundation; the same number of people also consider themselves poor (more details here and here)
  • Php129 – increase in the daily cost of living in the National Capital Region (NCR) between June 2010 and June 2015 as estimated by IBON (request additional details here)
  • Php77 – increase in the daily minimum wage of workers (including allowance) in NCR between June 2010 and June 2015 (more details here)
  • 44 percent – the portion of the estimated cost of living in NCR as of June 2015 that can be met by the current minimum wage in the region (request additional details here)
  • Php8 per kilo – increase in the retail price of regular-milled rice between July 2010 and July 2015; well-milled rice increased by Php7 during the same period (request additional details here)
  • Php10 to Php13 – largest increase in fares of LRT 1, LRT 2, and MRT 3 implemented by the Aquino administration starting in January 2015 (more details here)
  • 4 – number of service interruptions every month in MRT 3 in the first semester of 2015, twice the recorded number of monthly incidents in 2010; 193 total incidents of MRT 3 service interruptions from 2010 to June 2015 (more details here)
  • Php3.98 to Php12.65 per cubic meter – increase in water rates in Metro Manila between July 2010 and July 2015 (request additional details here)
  • 0.4 percent – share of the housing budget to the national budget in 2015, even lower than the 0.5 percent in the 2010 budget (more details here)
  • 70,000 – estimated number of urban poor dwellers in Metro Manila that have been displaced by demolitions under Aquino to give way to PPP and other projects, according to Kadamay (more details here)
  • 9 million – number of jobless adults as of first quarter 2015, according to the survey of SWS; in the second quarter of 2010 or the start of the Aquino administration, it was pegged at 8 million (more details here and here)
  • 44 percent – estimated portion of workers who are contractual, non-regular or agency-hired in 2012, up from 37 percent in 2008, based on Bureau of Labor and Employment Statistics (BLES) data compiled by IBON (request additional details here)
  • 1,024 – increase in number of OFWs leaving the country everyday between 2010 and 2014, based on data from the Philippine Overseas Employment Administration (POEA) compiled by Migrante (more details here)
  • 7 – number of OFWs executed abroad under the Aquino administration, the highest among all administrations, according to Migrante (more details here)
  • 144 – estimated number of workers killed due to occupational accidents under the Aquino administration, based on BLES data compiled by IBON (request additional details here)
  • 1.2 million – number of farmers who are still under leasehold arrangements (cited here; request additional details here)
  • 9 out of 10 – number of farmers who are qualified beneficiaries of CARP but are still landless, according to IBON (cited here; request additional details here)
  • 8 out of 10 – number of CARP beneficiaries who have stopped paying amortization and could be at risk of losing their land, based on Land Bank data (cited here; request additional details here)
  • 145 – number of farmers killed by suspected state agents under Aquino as of first quarter 2015; 55 – indigenous people killed; 13 – urban poor killed, according to Karapatan (more details here)