The 2008 UP Charter: Forging the Transition from Premier State University to Corporate Enterprise

Published on Bulatlat (http://bulatlat.com)

The first thing which would probably strike a casual reader of the "Centennial Charter" (RA 9500) is the replacement of the conventional label of "state university" by the term "national university." The current nomenclature rests on the crucial distinction between Private Higher Educational Institutions (PHEIs) and State Universities and Colleges (SUCs). Indeed, the yearly General Appropriations Act (GAA) only mentions SUCs as recipients of government subsidy. The studious elimination of all mention of the term "state university" in the Charter sends a message that this distinction no longer holds for the University of the Philippines. This suspicion is confirmed by the contents of the Charter itself.

BY CONTEND-UP*
Posted by Bulatlat
Vol. VIII, No. 20, June 22-28, 2008

The first thing which would probably strike a casual reader of the "Centennial Charter" (RA 9500) is the replacement of the conventional label of "state university" by the term "national university." The current nomenclature rests on the crucial distinction between Private Higher Educational Institutions (PHEIs) and State Universities and Colleges (SUCs). Indeed, the yearly General Appropriations Act (GAA) only mentions SUCs as recipients of government subsidy. The studious elimination of all mention of the term "state university" in the Charter sends a message that this distinction no longer holds for the University of the Philippines. This suspicion is confirmed by the contents of the Charter itself.

UP and the Rise of a New Managerial Stratum

One salient characteristic of the Charter is the creation of a managerial stratum distinct from the existing governance structures of the University. The UP President, aside from being referred to as the "chief academic officer," is also labelled in the text of the Charter as the Chief Executive Officer (CEO), which means no less than that she/he shall henceforth serve as the highest ranking officer of the corporate entity which is the "national university." Since the President shall be appointed in this capacity as the head of a corporation and since good CEOs don't come cheap, she/he shall also receive a salary befitting a CEO. In 2007, CEOs in the Philippines received an average base salary of $44,496 and $51,519 in annual cash or PhP4,271,899 or PhP355,991 a month (www.mercer.com [1]). Bear in mind that this is only the average. The Charter consequently states that the Board shall deem it within its powers to "determine the compensation of the President of the University" (Sec. 14). Despite the efforts of the promoters of the Charter to allow the UP President to have an unprecedented two terms, this proposal was eventually withdrawn because of strong opposition. Quite disturbing, however, is the fact that the Chancellor of each constituent unit will not only receive an unspecified amount to be determined by the Board but will also serve an unspecified term likewise to be determined by the Board (Sec. 18: "The Board shall determine [both] the term and compensation of the Chancellor").

Combining managerial and governance roles, the President shall serve simultaneously as the co-Chairperson of the Board of Regents (with the Chairperson of the Commission on Higher Education or CHED) and as the Chairperson of an Independent Trust Committee (ITC) to be made up of representatives nominated by the following private entities explicitly specified by the Charter: Bankers Association of the Philippines (BAP), Investment Houses Association of the Philippines (IHAP), Trust Officers Association of the Philippines (TOAP) and the Financial Executive Institute of the Philippines (FINEX). Furthermore, in case of two failed biddings these same private entities shall nominate representatives who shall make up the majority of a "third-party body" tasked with making a "fairness opinion report" (Sec. 23). The individuals making up the ITC and the "third-party body" shall be "entitled to a reasonable per diem as the Board may specify" (Sec. 23 & 24). Some information about these private entities is in order. The BAP was founded in 1964 and aims to provide "a necessary avenue for member banks to raise and discuss issues that affect the commercial banking industry." It counts among its members, 40 commercial banking institutions covering 26 local banks and 14 foreign bank branches (http://www.bap.org.ph/ [2]). The IHAP was founded in 1974 and its current membership consists of "fifty-five (55) member houses, which include the top players in the investment banking industry" (http://www.ihap.org/ [3]). Established in 1964, the TOAP's aim is to unite, professionalize and promote the Philippine Trust and Investment Management Industry http://www.toap.org.ph/ [4]). Lastly, the FINEX, founded in 1968 is said to be an "organization devoted to the continuing development and improvement of financial management techniques and the promotion of efficiency in business enterprises" (http://www.finex.org.ph/ [5]).

There is no good reason why these entities should have their names inscribed in such a solemn document such as the UP Charter. These are plainly transitory private entities, which do not sit well in a national public document drawn up with claims to perenniality such as the UP Charter. They could always be hired if and when consultants are needed and paid their "reasonable compensation." As it is, they could just fold up in a couple of years and leave embarrassing blank spaces on the Charter. This is almost equivalent to putting the names of private businesses in the Philippine Constitution. Being in the UP Charter lends these private entities more prestige than they are worth.

The function of the ITC, befitting its "independent" nature, is to recommend to the Board five banks aside from providing the "Board with direction on appropriate investment objectives and permissible investments with the view to preserving the value of the funds while allowing the University to earn a reasonable return thereon" (Sec. 24). Emphasis should be placed on the words "appropriate" and "permissible" in the above sentence in order to stress the actual managerial power of the ITC. These individuals, the President, the Chancellor, and these representatives from the BAP, IHAP, TOAP and FINEX shall henceforth constitute a distinct stratum of managerial technocrats whose "compensations" and privileges shall be at a qualitatively differently level than the ordinary faculty, REPS and administrative personnel making up the university community. It seems that such gains as the Staff Regent who shall represent the administrative personnel and the research, extension and professional staff was conceded by the framers of the Charter with the foresight that the BOR itself shall eventually no longer carry much weight in the scheme of things to come.

UP as a Commercial Area with an “Academic Core Zone”

The scope of the income generating activities that these individuals shall plan and undertake shall only be limited by the size of what is termed in the Charter as the "academic core zone." According to Section 22 of the Charter, "The Board may plan, design, approve and/or cause the implementation of land leases: Provided, That such mechanisms and arrangements shall … be exclusive of the academic core zone of the campuses of the University of the Philippines." The whole territory of the University lying outside of this so-called "academic core zone," which is as of yet unspecified, is therefore declared as a commercial zone. Furthermore, lands donated to the University from hereon may simply be sold if the terms of donation allow for it.

Profiting from the Pursuit of Truth

It is hard to see, given the power enshrined in the new Charter which now gives private business interests a preponderant role in shaping the future of the University, how such half-hearted provisos in the Charter itself, such as one stating that "such mechanisms and arrangements shall not conflict with the academic mission of the national university" or that "any plan to generate revenues and other sources from land grants and other real properties entrusted to the national university shall be consistent with the academic mission and orientation of the national university as well as protect it from undue influence and control of commercial interests" (Sec. 22) can realistically be adhered to. Instead of protecting it, the Charter actually renders the University extremely vulnerable to the "undue influence and control of commercial interests" as never before. For example, Sec. 3 on the "Purpose of the University," states that the University is "a community of scholars dedicated to the search for truth and knowledge." However Sec. 13 specifies without irony "that research and other activities funded by the University shall likewise undertake research in fields of topics that have promising commercial applications." ("Likewise" here means "also" and cannot be read as meaning "optional.") The message is clear: the scholars of the University shall be dedicated to the "search for truth and knowledge" only as long as these have "promising commercial applications."

The Price of Higher Wages

The thoroughgoing commercialization of the campus, and of the research and academic mission of the University together with projected substantial tuition fee increases are being sold to the faculty with the promise of higher salaries. This is the proverbial carrot. Indeed, Sec. 13 states that "any law to the contrary notwithstanding, to fix and adjust salaries and benefits of the faculty members and other employees: Provided, That salaries and other benefits of the faculty shall be equivalent to those being received by their counterparts in the private sector." Aside from the fact that a great part of these promised higher wages shall come from rising tuition fees and rampant commercialization, it is also more than likely that these salary increases shall come at the cost of undermining existing rights to tenure in the longer term and lead to a rising percentage of part-time and full-time non-tenure track teaching staff. This is already a problem in the US where according to the American Association of University Professors (AAUP), 68 percent of all university and college level teaching personnel comprise these so-called "contingent faculty," thus seriously undermining academic freedom, academic quality and professional standards (www.aaup.org [6]).

This Charter marks the next 100 years of UP. What has been dangled to clinch faculty support—exemption from the SSL and salaries competitive with the private sector—is neither forthcoming nor will it be within the range of the compensation package of the UP President as CEO. This Charter legitimizes the neoliberal turn to greater commercialization, privatization, deregulation of UP and of higher education in general.

A Charter Against the University of the People

This blatantly neoliberal charter accepts the conventional and deadly wisdom of aspiring to be "globally competitive" at the cost of erasing all traces of the University of the People. It accepts the assumption that the government cannot and will not provide sufficient budget for UP. Its main direction is to forge the transition from being a service-oriented public entity towards being a privately run corporate enterprise with its own CEO and an independent trust committee driven primarily, if not solely, by the search for profit. This Charter is nothing but the tragedy of the UP Centennial.

As the UP administration advances its neoliberal agenda in the transformation of higher education, CONTEND calls on the various sectors of the university to be militant and continue to struggle for a UP which may be called an exemplary university of the people.

Education is not a commodity!

Continue the Fight for a genuine University of the People!

*The Congress of Teachers/Educators for Nationalism and Democracy or CONTEND is a progressive organization of academics based in the University of the Philippines-Diliman. Please email your comments to upcontend@yahoo.com [7].

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Links:
[1] http://www.mercer.com
[2] http://www.bap.org.ph/
[3] http://www.ihap.org/
[4] http://www.toap.org.ph/
[5] http://www.finex.org.ph/
[6] http://www.aaup.org
[7] mailto:upcontend@yahoo.com

Health Groups Doubt New Law Would Make Medicines Cheaper

Published on Bulatlat (http://bulatlat.com)

Health groups expressed doubt that the Universally Accessible Cheaper and Quality Medicines Act of 2008 or Republic Act no. 9502 would bring down the prices of medicines in the country. They said that this is because the law failed to dismantle foreign control over the country’s drug industry.

By RONALYN V. OLEA
Bulatlat
Vol. VIII, No. 20, June 22-28, 2008

Mrs. Gloria Macapagal-Arroyo signed Republic Act 9502 or the Universally Accessible Cheaper and Quality Medicines Act of 2008 on June 6.

The law aims to bring down the prices of medicines in the country. The Philippines is one of the countries where medicines are the most expensive.

According to the World Drug Situation of the World Health Organization in 2000, the Philippines is classified as among countries where less than 30 percent of the population have regular access to essential drugs. Moreover, the Department of Health, in its Rational Drug Use paper in 1999 revealed that those who cannot afford the drugs they need resort to under-medication of essential drugs (such as antibiotics) and over-medication of cheaper symptomatic preparations. Symptomatic preparations are medicines that address the symptoms of a disease, like paracetamol for headache.

Regulation?

The Council for Health and Development (CHD), a national organization of community-based health programs, cited several reasons for believing that the new law would not deliver on its promise of reducing the cost of medicines in the country.

In a statement, Eleanor Jara, medical doctor and CHD executive director, criticized the omission of a Drug Price Regulatory Board.

The Lower House version, House Bill 2844 proposed the establishment of a Drug Price Regulatory Board. Iloilo Rep. Ferjenel Biron, principal author of the Bill, asserted that state intervention in the form of a Drug Price Regulatory Board is needed to significantly reduce the prices of medicine.

However, Section 17 of the enacted law gives the President, upon the recommendation of the Secretary of the Department of Health (DoH), the power to impose maximum retail prices over drugs and medicines.

Jara said, “Failure to create a regulatory body for drug prices would only strengthen monopoly trade among big players in the drug industry and would further banish local manufacturers into oblivion. Thus, the Filipino people’s access to essential medicines is at the mercy of profit-greedy transnational drug corporations.”

She added, “We do not understand why our legislators decided to give the authority to regulate the prices of medicines to the President when Mrs. Gloria Macapagal-Arroyo herself is tainted with corruption and other anomalies. Besides, she has no record of going against the profiteering acts of transnational drug corporations. She has allowed it for seven years. What can she do in the next 120 days?”

Under the new law, the health secretary is mandated to establish and initiate a price monitoring and regulation system for drugs and medicines within 120 days after enactment of the said law. The health secretary’s recommendations would later be approved by the President.

In an interview with Bulatlat, Dr. Geneve Rivera, secretary general of Health Alliance for Democracy (HEAD) branded the new law as a mere palliative. She said, “Walang ipinatutupad ang gobyerno na permanente at epektibong patakaran sa pagkontrol ng presyo.” (The government does not implement a permanent and effective policy of price control.)

TNC control

Rivera said that the Arroyo government does not recognize that foreign control over the country’s drug industry is the main reason for the prohibitive cost of medicines.

The CHD asserted that the Cheaper Medicine Act is silent about the control of transnational corporations (TNCs) in the marketing, distribution and pricing of medicines.

According to the CHD Primer on Cheaper Medicines, 72 percent of the country’s drug industry is controlled by TNCs. In 2006, TNCs cornered 70 percent of the P9.11-billion ($205,411,499 at an exchange rate of $1=P44.35) worth of medicines sold in the country.

In its position paper, KilosBayan Para sa Kalusugan (KBK) said, “TNCs control the pricing of essential medicine through international trade impositions like the Trade-Related Aspects of Intellectual Property Rights (TRIPS) of the World Trade Organization. This agreement further aggravates the escalating drug prices by granting exclusive license to TNC-dominated patent holders to produce certain drugs and dictate its price in the market.”

The Philippine International Trading Corporation (PITC) said that 80 percent of toll manufacturing of drugs for multinational corporations is done by one company. About 65-70 percent of wholesale distribution is handled by a sister company. In the end, more than 60 percent of the retailing of finished products is sold through Mercury Drug, which has more than 600 outlets nationwide.

Parallel importation

Moreover, Rivera said that provisions on parallel importation would bear no significant impact on the prices of medicines. She noted that even before the passage of the law, parallel importation is utilized by the government in its Botika ng Barangay (Village Drug Strores) program.

Third World countries use parallel importation to buy cheaper medicines from other countries. The Philippines buys medicines from Pakistan and India.

CHD’s Jara said that parallel importation would only further aggravate the country’s import-dependence and stunt the development of the local drug industry. She said, “Instead of being dependent on imports, why not develop our own drug industry and grant tax holidays for local manufacturers?”

The KBK’s position paper stated that developing a national drug industry is one of the most decisive steps in lowering the prices of medicines. It cited that India and Pakistan have done this during the last ten years.

The CHD primer revealed that there are about 600 drugs in the country that are considered essential. Of these, only 200 drugs are made by local companies. The other 400 off-patent drugs do not have local generic counterparts and are thus dependent on importation.

Alternatives

The KBK and CHD proposed as an alternative the creation of a transitory drug price regulatory board composed of representatives from the academe, consumers and health professionals. The drug price board would regulate prices of essential medicines based on production costs and a reasonable profit.

The health groups said parallel importation of essential medicines should be selective and subject to extensive government testing for safety and efficacy.

They are also pushing for the implementation of the Generics Law. The CHD noted that while the law has been in effect for 19 years, many are still not aware that generic equivalents are as safe and effective as branded, expensive drugs. As of 2006, generic drugs account for a measly four to five percent of medicines being sold in the Philippines.

Long-term solutions recommended by the health groups include the development of a self-reliant national drug industry that is responsive to the medical and health needs of the people; development of the technology to refine and extract raw materials and chemicals; tapping of the medicinal potential of indigenous and herbal plants in the Philippines through government-sponsored research and development, among others.

Palliative

Jara said, “The Arroyo government is merely preoccupied with populist rhetoric. In reality, it falls short of medium-and long-term solutions to the Filipino people’s problems.”

Rivera said the Arroyo government would not implement measures that contradict its own policy framework. The deregulation of the drug industry and liberalization of imports of medicines, she said, form part of the neoliberal policies being undertaken by the Arroyo government. Bulatlat

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