20 REASONS WHY PHILIPPINE PRESIDENT GLORIA ARROYO DOES NOT DESERVE A DOCTORATE FROM THE UNIVERSITY OF SAN FRANCISCO

By BAYAN-USA
November 11, 20041

1. The fiscal crisis under Arroyo is the worst ever in the history of the Philippines. The country's external debt as of September 2003 stood at P1.5trillion, of which 51 percent is direct government debt to international financial institutions, such as the IMF and World Bank. The foreign debt eats up some 31% of the national budget. By January, 2004, total outstanding debts of the government already exceeded P3 trillion. Arroyo has borrowed the most among all Philippine presidents. The majority of the borrowing is from the United States. From 2001 to 2003 she borrowed more money in 3 years than Presidents Ramos and Estrada did for eight years, 1992 to 2000. Foreign credit analysts have started downgrading the Philippines as an investment destination. The purchasing power of the peso has steadily declined and is at its worst in 2004, from 1.49 in 1990 to .56 in 2004, (calculated at a 1994 value of 1.00).
2. Her policies have increased poverty and now 88% of Filipinos today are poor. The Philippines slid from 77th to 85th place among countries in the world where people live under extreme poverty. In the National Capital Region, the P280 minimum wage is way below the needed P545.73 minimum wage for a family of six. Nationwide, a P125 minimum wage increase is needed to begin to get Filipino workers out of poverty. Some 481,000 peasants and fisher folks lost their livelihood within just one year, from April last year to April this year.
3. She has made the wealthiest 10% of the population 80% richer in comparison to the poorest 10% of the population. In 1994, the top 10 percent income bracket earned 19 times greater than the income of the bottom10 percent of the population. Today in 2003 the top 10 percent income bracket earns 24 times greater than the bottom 10 percent. Her policies have proved to widen the income gap, inequalities and disparities, and further marginalize the poor and underprivileged.
4. 10 Party-list representatives were murdered during the NationalPresidential Elections of 2004, all of whom were part of organizations who openly campaigned against her re-election. 6 campaigners of Bayan Muna were killed, 3 members of Anakpawis and 1 from Gabriela Women's Party had deaths. Many of these killings are allegedly under the auspices of the Armed Forcesof the Philippines, of which she is Commander-in-Chief. The 2004 elections were the bloodiest elections in the history of the Philippines since the Marcos dictatorship.
5. There have been more Human Rights Workers killed under the Arroyo Administration than under Marcos. The killings of 14 human rights workers, those persons who investigate human rights abuses, are unprecedented under the Arroyo administration. Known alleged perpetrators, such as Col. Jovito Palparan, Jr. (a.k.a.-the Butcher of Mindanao), have been promoted to General under her administration.
6. Attacks on Filipino journalists have reached crisis proportion, a substantial number under the Arroyo administration. Since 1986, 54 journalists have been murdered. 6 of them occurred in August of 2004. The National Union of Journalists in the Philippines (NUJP) are demanding justice, as none of the perpetrators since 1986 have been brought to justice. The journalists who are targeted are those who are exposing corruption in the government and those exposing scams and scandals by the Philippine landlords and wealthiest families. The first casualty of democracy is the truth.
7. Her track record and attention to matters of human rights violations is one of the worst since Marcos. In May of 2003, Amnesty International, released a report that practically condemned the Arroyo administration for the increasing number of violations in 2002. The number of human rights violation (HRV) cases nationwide between January and May 2003 was 2,010 cases, representing 163,023 individual victims, 16,348 families and 70 communities. Most common human rights violations are harassment (i.e.-threats, surveillance, etc.) at 668 cases; unjustified arrest (230cases); killings (i.e.-summary executions, political assassination, massacre) at 140 cases; and forced evacuation (127 cases).
8. Contractualization and job lay-offs under Arroyo are widespread, increasing up to 85 percent nationwide in 2001, since 1992. The practice of hiring workers on contractual basis has deprived workers of their right to job security, benefits, right to organization and grievance. For example, magnate Henry Sy, who owns ShoeMart, employs 20,000 contractual employees in 15 malls nationwide, and only around 4,000 of his workers are regular employees. Contracts last for 3 to 5 months.
9. She extended the national Comprehensive Agrarian Reform Program (CARP) to 2008, which is notorious for being a bogus land reform policy. After 16 years, CARP has had inconsequential impact on the peasant population. CARP is estimated to have benefited less than 5% of an estimated 10 million farmers nationwide. CARP is notorious for its loopholes which have allowed large landlords to re-cover, retain or be exempted from land re-distribution to peasant farmers (such as the Aquino family in Tarlac or the Cojuanco family's monopoly of land for coconut production).
10. Indigenous groups are decrying 7 years of the IPRA Law and the violations of indigenous peoples rights under the Arroyo administration. Indigenous peoples have exposed the Indigenous Peoples Rights Act (IPRA) as "toothless" in protecting their rights. The Mangyans of the Bigkis at Lakas ng mga Katutubo sa Timog Katagalugan) said foreign-owned development projects like mining and mega-dams violate their rights and place the ills of liberalization on the lands of indigenous peoples. They said the IPRA empowers the state to control and supervise exploration, development and utilization of natural resources, it disempowers the indigenous peoples from using the resources in their ancestral lands. They said the government titling and certification of ancestral land is a violation of their rights.
11. Arroyo has allowed the education budget to be slashed, impoverishing Filipino children and youth. According to the Wallace Report, there are 1.7million children in the Philippines aged 7 to 12 who are not in school because of poverty. Education spending has dropped from 19.3 percent of total government expenditures in 1997 to 15.5 percent in 2004. The average government spending on education per student is $170. This pales incomparison to Thailand ($550) and Malaysia ($930). There is a 73% drop-out rate in tertiary education. Based on the Wallace Report last June, of 100 who enter primary school, only seven shall be able to finish college.
12. She introduced 8 new tax measures which focus on raising indirect taxes from the pockets of the poor, while corruption is rampant in her administration. The budget deficit reached P200 billion ($3.57 billion) in2003. As austerity measures, Arroyo introduced new taxes by: shifting to agross income tax system, implementing a P2 peso across-the-board increase on petroleum products, increasing the value-added tax on common goods from 10%to 14%, increasing taxes on alcohol and tobacco products, increasing government service fees and charges, and placing a tax on text messaging. Meanwhile, the purchasing power of the peso is falling, which means that the money left over for Filipinos after taxes buys less than before. Also,corruption cases such as that of General Garcia of the Armed Forces of the Philippines and the prolonged justice against deposed "President" Estrada go without just resolution.
13. Water remains unaffordable and inaccessible after she privatized public water. Since the privatization of the Manila Waterworks and Sewerage System(MWSS) in 1997, water rates in Metro Manila have increased by as much as 400 percent. Furthermore, only 57 percent of the population covered by the newly privatized company, Maynilad, have 24-hour water service. Privatization has increased foreign-ownership of Philippine water by multi-billions of dollars of investment, which has the impact of placing public water issues in the hands of foreign owners.
14. Her policies on deregulation of the oil industry failed to bring down oil prices and instead increased oil prices to unprecedented levels. Arroyo ignored consumer groups and other cause-oriented organizations who called for the long-standing nationalization of the oil industry as the alternative to deregulation. In a recent report by IBON Foundation, oil companies were found to have over-priced their products by P0.16 per liter, and garnered extra profits amounting to P216 million ($3.86 million) for the period. The increase in oil prices makes the prices of basic commodities, such as transportation fares, gas for cooking, and other products.
15. Arroyo's further privatization of the oil industry puts oil further into the hands of oil barrons, foreign ownership and monopoly pricing, with little public accountability. Arroyo plans to sell 3.75 million government shares in Petron to private corporations in order to raise money for the national deficit. This revenue generating scheme being prodded by the IMF/World Bank is in collaboration with the scheme to deregulate the downstream oil industry in the Philippines, and put the Philippines crucial oil needs under stronger foreign control. Petroeum prices have increased 7 times this year and 61 times since the oil industry was deregulated in 1996.
16. Arroyo implemented new "unbundled power rates" and privatized the National Power Corporation of the Philippines. At the behest of theIMF/World Bank, Arroyo's privatization increased the prices of electricity and had the public foot the bill for stranded debts. The private company that benefited is MERALCO. Arroyo unfurled legislation featuring: the unjust and oppressive purchase power cost adjustment under four cost charges; a 16.7 centavos overcharge; a socialized pricing scheme that allows Meralco to get hundreds of millions of additional profit; and, stranded debts and contract costs of privatizing will be paid by consumers instead of by private companies.
17. Arroyo was exposed and allegedly guilty of using government funds to finance her electoral bid. According to former Solicitor-General Frank Chavez, the government money used to finance Arroyo's presidential campaign could amount to as much as P15 billion ($267.9 million).
18. Arroyo re-tooled the government's labor-export policy to support the United States' war of aggression and colonial occupation of Iraq. The policy can now be called labor-conscription which aims to recruit overseas Filipino Workers (OFWs) to render auxiliary services that the U.S. armed forces need in their wars of aggression today. Wanting to cash-in on the spoils of war, Arroyo in April 2003 sent Roberto Romulo as head of the newly-formed Philippine Public-Private Sector Partnership for the Reconstruction and Development of Iraq to Washington DC to promote the export of 100,000 overseas Filipino workers to the Middle East. Of 4,000 OFWs in Iraq, 80 percent are employed by Prime Projects International (PPI), a subcontractor of US Vice President Cheney's Halliburton KBR Engineering & Construction. Workers are exploited and are at great risk, not to mention the policy displaces thousands of potential Iraqi workers.
19. Arroyo has been declared a war criminal by the International Criminal Tribunal for Iraq (ICTI). Held on October 16, 2004 at the Camelot Hotel in Quezon City, the ICTI was joined by prominent international jurors and prosecutors. The ICTI said Arroyo made the Philippines an unwilling partner in the U.S. wars of aggression in Afghanistan and Iraq. She stands guilty of violating the independence and sovereignty of these countries as well as the Philippines' 1987 Constitution, which mandates a peaceful foreign policy, its own commitment to the United Nations and to international law. The ICTI also held Arroyo accountable for making the entire Philippine territory a haven for American war criminals by granting them immunity from prosecution before the International Criminal Court (ICC).
20. GLORIA, RESIGN! On October 21, on National Peasant Day, a protest demonstration became an occasion to air the growing demand for the resignation of President GloriaArroyo. Peasant protesters held a "Street Conference" and launched a "Manila Declaration," a petition aiming to gather a million signatures for the resignation of Arroyo. Some 481,000 peasants and fisher folks lost their livelihood within just one year, from April last year to April this year. The declaration assailed the anti-peasant and anti-people policies of the Arroyo administration, including agricultural trade liberalization and the absence of a genuine agrarian reform program.###

BAYAN-USA/522 Valencia Street, San Francisco, CA 94110
bayan-usa@riseup.net

2004 Merit Incentive and Rice Subsidy Released to UP Manila Employees

Release of both benefits belied the rumor that the P1,000.00 worth of rice subsidy will be deducted from the P5,000.00 Merit Incentive Bonus.

The first batch of the 2004 Merit Incentive Bonus amounting to P5,000.00 and the P1,000.00 worth of Rice Subsidy equivalent to 56 kgs. of Sinandomeng rice variety were released last week to all qualified UP Manila and PGH employees. The distribution of rice subsidy was started on Monday, November 8, 2004 and as of Friday, November 12, 2004, only about 300 of the 3,409 qualified employees have yet to received their rice deliveries. Meanwhile the first batch of the 2004 Merit Incentive Bonus amounting to 5,000.00 was released early evening of Thursday, November 11, 2004 through each employees' Savings Account in the Philippine National Bank.

The release of P5,000.00 Merit Incentive belied the persistent rumor since last month in employees' lounges that the rice subsidy for this year will be deducted from the merit incentive bonus.

The Merit Incentive Bonus was authorized through the 1188th meeting of the UP Board of Regents (BOR) held last October 28, 2004 and the subsequent Memorandum No. FN-04-26 dated October 29, 2004 issued by President Francisco Nemenzo. The said BOR meeting further gave authority to President Nemenzo, "to give additional merit incentive and the authority to decide when such merit incentive shall be released." Said BOR meeting further clarified that the merit incentive is not a "new" or "additional" benefit which are suspended under Section 3 (b) of Administrative Order 103 of President Gloria Macapagal Arroyo dated 31 August 2004 "Directing the Continued Adoption of Austerity Measures in the Governement." It states finally, that the grant of merit incentive "is also in keeping with the Collective Negotiation Agreement (CNA) between U.P. and the All U.P. Workers Union.

In the history of merit incentive bonus in the University, the lowest was given in the year 1999 when U.P. and P.G.H. employees only received P2,500.00. The All U.P. Workers Union then was not the recognized union of of the University. The Merit Incentive Bonus only goes up to P10,000.00 level starting in 2001. Incidentally, 2001 was also the year that the All U.P. Workers Union won in the Certification Election held on April 2001. Such amount was maintained in 2002 and went down a bit at P9,000.00 in 2003.

This year 2004, as early as October 18, 2004 our National President, Mr. Clodualdo "Buboy" Cabrera wrote President Nemenzo, conveying our request for the said incentive saying that: "sana'y mas higit pa sa ibinibigay sa nakaraang tatlong taon." Said letter further expresses our collective concern in stating: "Napakalaki ng maitutulong nito sa lahat ng empleyado upang kahit papaano ay makaagapay sa napakatinding krisis pangkabuhayan na dinaranas ng milyong-milyong mamamayan sa kasalukuyan."

Ex-AFP Inspector-General Sees Whitewash in Court Martial vs General

Retired Navy Captain Danilo Vizmanos, formerly with the AFP Office of the Inspector General, is not convinced the court martial proceedings recently initiated against Maj. Gen. Carlos Garcia would result in a fair rendering of justice. Court martial proceedings can actually be used to perpetrate a whitewash in military scandals, he says.

BY ALEXANDER MARTIN REMOLLINO
Bulatlat

The court martial proceedings initiated last week against Maj. Gen. Carlos Garcia, former Armed Forces of the Philippines (AFP) comptroller, are not assurance that justice will be done in his case, according to retired Navy Captain Danilo Vizmanos former AFP Inspector-General.

Garcia presently stands accused of amassing some P143 million ($2.55 million based on a $1:P56 exchange rate) in ill-gotten wealth. The difference between his income in the last 10 years and his total expenses for the same period amounts to only P2.57 million.

President Gloria Macapagal-Arroyo, apparently feeling the impact of public pressure to act against military corruption, had called for court martial proceedings against Garcia.

But the Garcia corruption case has also triggered a constitutional crisis, with the Sandiganbayan (anti-graft court) split over whether to continue administrative charges against the former AFP comptroller and the AFP insisting on its court martial jurisdiction.

Questions have been raised on whether the supremacy of civilian courts is now being undermined again by the AFP just like what happened under martial law in the 1970s.

What happens in a court martial?

Taking off from the Garcia case, Vizmanos said: “There should first be an investigation, it could be by the inspector-general or the provost marshall, depending on the nature of the case. In the case of Garcia, it may be the inspector-general. That is to find out whether there is indeed something fishy going on – to unearth the facts of the case, so it’s something like a fact-finding operation.”

If there is an established basis, the inspector-general would recommend to the AFP chief of staff that a pre-trial investigation be conducted. The chief of staff would then appoint a pre-trial investigator; usually any officer could serve as pre-trial investigator. “But in big cases like the Garcia scandal,” he said, “the investigators would have to come from the Judge Advocate General’s Office (JAGO).”

The pre-trial investigator, who serves as the counterpart of the civil court’s fiscal, will look into the case to see if there are reasonable grounds for filing a case. If warranted, the pre-trial investigator would prepare a charge sheet.

The charge sheet would then be referred to the JAGO and sent to the chief of staff or any concerned officer. The concerned officer would become a convening authority and issue orders for court martial.

There are three kinds of court martial: general court martial, special court martial, and summary court martial. The summary court martial, the lowest level, has only three members; while in the special court martial there are five members. The general court martial has seven members.

The court martial officers, according to Vizmanos, should be equal in rank to the accused, or higher. “In the Garcia case it is rather difficult for them, considering Garcia’s rank: the court martial officers to try him should be major generals or higher.”

Appointment of court martial officers

“Now, it is in the appointment of court martial officers that you can sense whether or not there will be any justice done,” Vizmanos reveals. “You can see in this where the sympathies of the superior officers lie: whether they are in favor of the prosecution or the defense.”

This can be figured out, Vizmanos said, from the composition of the officers appointed to the court martial. “Who is appointed trial judge advocate (the counterpart of the civil court’s prosecutor), who is appointed defense counsel – because they are all appointed by just one authority, the convening authority.”

In the Garcia case, Vizmanos pointed out, “the convening authority is the chief of staff.”

“If the convening authority is biased toward the defense, he would appoint a former classmate or schoolmate, or even someone who is involved in the case,” Vizmanos said. “So if the chief of staff is also involved, he could weaken the case by appointing a mediocre trial judge advocate and putting the more competent ones in the defense side. They could even get civilian lawyers to help the defense.”

“In the Garcia case, the office of the chief of staff is apparently also involved,” Vizmanos said, “and yet it is the convening authority for the court martial. So it is possible that the court martial proceedings would continue, but the proceedings may be confined to only one person.”

Lawyer Roel Pulido, who presently handles the case of some 300 soldiers who staged an armed protest action in Makati City last year against military corruption and atrocities against the civilian populace, agrees with Vizmanos on the argument that court martial would not necessarily bring justice. “The court martial may even be used to exonerate accused officers favored by the higher-ups or prevent the entire truth from coming out,” he told Bulatlat in an interview.

Pulido also said that his clients have not told him of any single case in which top-ranking officials were convicted in court martial proceedings.

In a court martial, Vizmanos said, the whole truth will not necessarily come out. “It could be only a partial truth that would come out of the proceedings,” he pointed out. “The court martial can be a means of covering up the whole mess, sacrificing one person and keeping others off the hook.” Bulatlat

© 2004 Bulatlat ■ Alipato Publications

Pro-poor Response to the Fiscal Crisis

By Antonio Tujan, Jr. and Arnold Padilla, IBON August 2004

The challenge for the Arroyo administration is how to unite the various sectors in supporting the campaign of the President to tame the fiscal crisis. The admission of the President that the country is in the midst of a fiscal crisis following the report of the University of the Philippines (UP) School of Economics was meant to achieve this. But is unity possible under an anti-poor response to the fiscal crisis?

The challenge for the Arroyo administration is how to unite the various sectors in supporting the campaign of the President to tame the fiscal crisis. The admission of the President that the country is in the midst of a fiscal crisis following the report of the University of the Philippines (UP) School of Economics was meant to achieve this. But is unity possible under an anti-poor response to the fiscal crisis?

Popular support

The declaration of the President was meant to create public alarm and gain popular support for the new taxes that government wants to impose. It was meant to pressure Congress to give the President emergency powers to better steer the country during a ‘state of fiscal crisis.’ However, the admission did not achieve its desired result but only caused further speculation in the economy. The foreign exchange rate slid back to $56: P1 while the stock market faltered and the banks’ risk premium increased. Legislators opposed to the new taxes including those who supported the President last May elections have remained firm in their position. The proposal for an emergency power was shot down at once.

Burden sharing

Malacañang and the UP School of Economics harp on unity and ‘burden sharing’ among government, the business sector, and the ordinary folk to find a meaningful solution to the fiscal crisis. But for the poor, it is not acceptable not only because they cannot bear any longer the burden of rising cost of living, unemployment, and low income. The measures being proposed by the President and the UP School of Economics actually pass most of the burden to the people. A correct understanding of the root of the fiscal crisis is required if government seriously wants long-lasting solutions. This also enables government to design short-term measures that are more acceptable and more pro-people.

Debt management

The most important first step to address the fiscal crisis is a review of government’s debt management. Government looks at debt as an instant remedy rather than the root of its fiscal woes. In fact, even as the President recognized the fiscal crisis, government continues to borrow heavily from foreign creditors. Between March and July, foreign debt has jumped from more than $56 billion to almost $61 billion. In the first half of the year, foreign loans comprised 37% of gross borrowings. The original target was only 16 percent. This worsens the fiscal position of government since its debts get more exposed to currency fluctuation.

Meanwhile, automatic debt payment bleeds the public coffer dry. The proposed debt service for 2005 is P646 billion compared with P10 billion for health and P112 billion for education. Malacañang should endorse current efforts in Congress to review how government manages its debts.

At a time of fiscal crisis, it is more necessary to impose a cap on borrowings and payments so government can have more flexibility in managing the people’s money and protecting the people’s welfare. If the Arroyo administration can only muster enough political will, it can negotiate with the country’s creditors to reduce some of our debts. Government must re-negotiate onerous debts like the P500-billion debt of the National Power Corporation (NAPOCOR) to lessen its impact.

Customs collections

With a debt cap easing the fiscal hemorrhage, government can look for ways to raise additional revenues and reduce the budget deficit. But government does not need to impose new taxes that are regressive and anti-poor like the P2 per liter increase in specific tax on oil products and the two-step hike in value added tax (VAT). Instead government must raise its customs collections by increasing the tariff levels of agricultural and industrial imports that have been liberalized under the World Trade Organization (WTO). Since 1996 (the first year of the WTO), the Bureau of Customs’ (BOC) tax to GDP (gross domestic product) ratio has progressively decreased from 4.8% to 2.4% in 2002.

Investment perks

The Arroyo administration can also reduce the incentives it gives to attract foreign investors. The Department of Finance (DOF) recently reported that the country waived P229 billion in potential revenues last year due to the numerous tax breaks and duty exemptions granted to businesses. Even if government suspends 50% of these perks, the Bureau of Internal Revenue (BIR) and the BOC can still collect around P165 billion.
The Department of Trade and Industry (DTI) is now reviewing the incentive packages of the Board of Investment (BOI) and the Philippine Export Zone Authority (PEZA). The DTI should focus on the perks of big foreign corporations and maintain the incentives for small local businesses.

Plug leakages

Another doable measure to improve the country’s revenues is to plug the leakages in the tax collection system. Estimates show that uncollected revenues from interest income tax, documentary stamp tax, gross receipt tax, excise tax on tobacco products, value added tax, individual and corporate income tax reach more than P179 billion.

If the BIR can recover even 50% of this uncollected amount, it still translates to almost P90 billion-- P10 billion more than what government projects it can collect from the new tax measures.

Another estimate, meanwhile, says that a measly 1%-improvement in our tax collection effort (tax to GDP ratio) means P32 billion more revenues for government.

Unity means pro-poor

The fiscal crisis hurts the poor Filipinos more than it hurts the rich and the big corporations. A fiscal crisis means that the resources of government are so drained that it can no longer fund social services and development projects for the poor. Thus, asking the poor to pay more taxes so that we can get out of the crisis is doubly unjust. Only under a pro-poor management of the fiscal crisis will make Filipinos rally behind the Arroyo administration during this difficult time.

IBON Features
Bulatlat

© 2004 Bulatlat ■ Alipato Publications

Much Ado Over Nothing

Release of Yearend Bonuses No Big Deal, Civil Servants To Continue Our Demand For Salary Hike - COURAGE

Press Release
November 11, 2004
Ferdinand Gaite

They could heave a sigh of relief that their bonus will be released but stressed there’s nothing to celebrate as their salaries remain frozen at starvation levels. This was the reaction of government workers to the announcement that the Department of Budget and management has released P9.3B for their Christmas bonus.

In a statement, the militant COURAGE said Malacanang’s announcement is no big deal to the 1.4 million or more government employees because as far as the economic realities of government employees are concerned, the traditional yearend bonus and cash gift has been long spent even before it is received. The 13th month pay has been collateral for loans. Moreover, Malacanang did just that, ANNOUNCE, because the payment of the yearend bonus is mandated by law, and by practice government offices release said benefits between November 16 and 30.

Ferdinand Gaite, COURAGE National President said the fund release is the least the government could do to prevent itself from further fueling the growing restiveness among the employees. Earlier, Malacanang was said to have been contemplating on delaying or even withholding the state workers’ bonus citing the fiscal crisis.

“It would have made a difference if it is our demand for a salary increase. The yearend bonus would only pass our hands and in some cases from the payroll straight to the money lenders and loan sharks. In fact, what we will receive is the payment of the remaining 50% of our yearend bonus and the Php2,500 cash gift. We have already received half of it in May and was used to finance our children’s tuition fees. So what would be left to us is still mounting unpaid loans. It is the reason why we insists on a long overdue salary adjustment”.

Government workers are demanding a P3,000 across the board salary increase for all government employees nationwide citing the increasing cost of living. The last time they got a raise was way back in 2000, a measly 5% of their basic pay which then stood at P4, 800. The increase was equivalent to P240.

“With a monthly salary of P5,082 and the price of a Liquefied Petroleum Gas increasing from P300 in 2000 to P460 this month, how does the government expects us employees to survive? Just about everything has gone up, fuel, electricity, transportation, water and even the prices of basic goods and services but not our salaries!”

Gaite announced that government employees are set to hold their biggest rally this coming November 24 in Mendiola. “We will bring to Malacanang’s attention all our issues – pay hike demand, ouster of GSIS PGM Garcia, opposition to rationalization plan, transfer of offices, reorganization, privatization and other forms of lay-off. As the sole employer of the biggest workforce, this government has become bereft of any moral authority given the way it treated its workers”. #

Don't Blame Rank-and-File For Low Collections - Rep. Beltran

Mula sa Tanggapan ni Anakpawis Rep. Crispin B. Beltra
News Release
November 9 , 2004
House of Representatives, South Wing Rm 602931-6615
Ina Alleco R. Silverio, Chief of Staff
Email: anakpawis2003@yahoo.com
Celphone number 09213907362

Rep. Beltran defends rank and file employees of Bureau of Customs against accusations of low collections; slams IMF, WTO programs in the agency.

Anakpawis Representative Crispin Beltran once more takes up the cudgel for government employees and their rights to security of tenure and benefits by opposing House Bill No. 2996 or the Committees on Civil Service and Professional Regulation, Oversight, Ways & Means and Appropriation's Report No. 28 authored mainly by Representatives Danilo Suarez, Imee Marcos, Mauricio Domogan, FrancisNepomuceno, Jesli Lapus, and Rolando Andaya Jr. among others. The bill, titled "An Act Providing for Optimum Performance in Revenue Collection through the Grant of Special Incentives and Rewards for Exemplary Service and through Lateral Attrition in revenue generating agencies of the government and for otherpurposes," is more commonly known as the LAL, or the Lateral Attrition Law.

Beltran said that employees in the GFIs and the revenue-generating agencies such as the Bureau of Internal Revenue and the Bureau of Customs were up in arms against the LAL, saying that the proposed law was premised on unjust grounds and biased against employees. "The proposal tries to pass itself off as a system of reward and encouragement to generate increased collections, but in truth it is nothing but a streamlining program that viciously does away with due process and attacks employees' constitutionally-guaranteed rights to security of tenure," he said. "The national government is using government employees as its whipping boys and sacrificial lambs in its desperate attempts to scrimp and save.

"Beltran said that it was immoral, illegal and unjust that the government is blaming rank and file employees from the low collection of taxes and other revenues. He said that government employees in the affected agencies performtheir tasks to the best of their abilities, but they only act within the rulesand regulations governing their agencies. "The programs being implemented in the agencies and the systemic corruption in the higher offices are the real problems, not the employees," he said.

Beltran pointed out that in the BOC, for instance, there are there are programs and policies that hinder the increase in agency collection: the 11-point reform Program of International Monetary Fund (IMF) in the BOC geared towards liberalization and biased for foreign investors; the faulty Philippine taxComputerization Program (PTCP); the tariffication program imposed by the WorldTrade Organization (WTO); gargantuan tax exemptions for big businesses; shift of valuation system from fair market value to export value to transaction value; the selectivity system (95% of the goods that enter the country are no longer examined and automatically allowed entry; and direct/technical smuggling.

"So why are the employees being blamed for low collections? It's strategically impossible for them to be at fault for the supposed under performance of the BOC.

The core programs and the system of checking, monitoring and tarrification being implemented in the BOC are opposed to high revenue collection, but biased for foreign investors and their big local business partners," he said.

He also pointed out that the Philippine Tariff Computerization Program (PTCP) for BIR and BOC was also implemented by the National Government. The PTCP got $150M financial loans from the IMF-WB, but the program was a washout. The computer hardware for the said project was provided by UNISYS, and the computer software was provided by UNCTAD. The system uses the software ASYCUDA++ (Automated System Customs Data). Crown Agents was also hired as PTCP's project consultant. The computers and the servers are constantly bogging down. Despite the computerization system, the project was not successful both in increasing revenues and ending corruption in the BIR and BOC.

Finally, Beltran scored Malacanang for its moves to reshuffle the leadership in the BOC, justifying the reshuffle to low collections. Head collectors from Subic, Clark, Tacloban and Batangas have been recently reshuffled."This is more than likely the beginning of the comprehensive reorganization in the BOC," he pointed out. "Malacanang is already moving to put its key people in the BOC as a prelude to the implementation of the lay-offs of the rank and file," he said.#

Cover-up in the Military

By: Raphael Martin/Glenda M. Gloria,
Contributing Writer/Managing Editor
Newsbreak (October 28, 2004)

This is the sad story of how military generals protect their own, and why.

As early as January 2004, the Armed Forces leadership got wind of reports that about US$100,000 being taken to the US in December 2003 by a son of Maj. Gen. Carlos F. Garcia had been intercepted at an American airport for being undeclared. The military leadership did not lift a finger to verify the reports, much less investigate the elder Garcia.

In March, claiming he had no hard evidence to prove the “rumors,” Gen. Narciso Abaya, Armed Forces of the Philippines (AFP) chief of staff, chose an easy way out of the mess: he transferred Garcia from the lucrative position of J6 (AFP deputy chief of staff for comptrollership) to J5 (AFP deputy chief of staff for plans and programs), which has the lowest budgets of all the J-staff offices in Camp Aguinaldo.

Over dinner in early August with NEWSBREAK, after we wrote a blind item on the US airport incident, Abaya disclosed that he had been “hearing things” about Garcia, thus his decision to move him to J5. “At least, walang pera doon (There’s no money in that office),” he explained.

The transfer didn’t sit well with some officers.

From March to June, the recalcitrant Army Col. Ricardo “Dick” Morales—one of the presidential guards of former President Ferdinand Marcos who joined the rebel movement that staged a coup against him in 1986—pestered Abaya with text messages asking him two questions: first, if the reports about Garcia’s son were true; second, what the AFP leadership intended to do about it. Abaya himself had told NEWSBREAK that “Morales has been busy texting me about Garcia.”

By July, feeling nothing was being done about it, Morales decided to write Abaya. In his July 15 letter, Morales told the AFP chief that as far as he knew, the US had already relayed the information to the Intelligence Service of the AFP (Isafp). It was the talk in military camps. While he didn’t want to prejudge Garcia, Morales told Abaya, the comptroller had to come clean for the sake of the institution.

Morales also asked Abaya if Garcia’s transfer to J5 had something to do with the US incident. Morales thought: Is Abaya now sending signals to the AFP that the J5, which attracts the strategists and good writers in the military, is a lounging area for the corrupt?

Abaya called up Morales and ordered him to bring his complaint to the AFP Office of Ethical Standards and Public Accountability (OESPA), the unit tasked to look into complaints against soldiers. Morales did, only to be asked by an OESPA officer for advice on how they should proceed from that information. The head of the OESPA, Vice Admiral Ariston de los Reyes Jr., who was Garcia’s classmate in the Philippine Military Academy (PMA), did not deem it necessary to inhibit himself from the case.

“We did not know who among the US authorities we were supposed to deal with regarding the incident. The information from the letter only said so much,” De los Reyes told NEWSBREAK. The AFP was satisfied with Garcia’s August 2 letter to Abaya explaining that the money had come from loans from friends and relatives.
If the military bosses wanted to probe Garcia’s dollar possessions and other assets in the US, they would have gotten results—easily.

The Philippine military is the staunchest ally of the US in the region, and Abaya, a West Point graduate, has extensive personal and official networks with American authorities. The Philippine-US Joint Defense Assessment has been in place since last year, a mechanism that allows officials from the Pentagon and the US Pacific Command to assist the military on key reform areas.

One phone call by Abaya would have led to a discreet probe of Garcia’s properties in the US and an accounting of how much his family had carried through US airports in the last few years.

Internally, the chief of staff enjoys the power of moral suasion over his peers. Abaya, even if he is chair of the board of the AFP Savings and Loans Association Inc. (AFPSLAI) where Garcia has millions in deposits, could not poke into the transactions since the bank is covered by Central Bank rules. But through informal channels, the chief of staff can get information from the bank, which is run by retired military officers.

Abaya, however, told a House hearing that he needed time to gather evidence against Garcia and that “we were already overtaken” by the Ombudsman’s actions.

Two things stopped the AFP high command from investigating Garcia: the unchecked, antiquated procurement and disbursement system in the AFP and the culture that pervades among men in uniform.
It doesn’t help that the defense secretary, lawyer Avelino Cruz, is new on the job. While many favor the appointment of a civilian to the helm of the defense department, Cruz has a handicap at this crucial time: he barely knows the complex organization to be able to crack the whip on it.

“He has to fight tooth and nail to change the culture [in the military],” said Orlando Mercado, the first civilian defense secretary in the post-Marcos era.

Lucky General

Until his questionable wealth was exposed, Garcia had the best of both worlds. He belonged to two powerful cliques in the Armed Forces: the class of 1971 of the PMA, which includes Abaya (who graduated on the same year from West Point but is included in the PMA Alumni Registry as a member of the class) and the so-called comptroller family, a tight, exclusive bloc of military officers who corner appointments to comptrollership positions. If one is to find another explanation for this stroke of luck, Garcia, like Abaya, is an Ilocano.

Until last year, Garcia was class president of the Class 1971 alumni. A PMA classmate describes him as a “very generous” officer.

No senior officer of the AFP in recent history has been punished for corruption or incompetence in the battlefield. At the most, they are transferred to remote provinces, put on a “floating” status, or, like Garcia, named to a low-budget unit.

Two senior generals had been investigated and charged with corruption in high-profile cases—but only after they had retired. They were former AFP chief of staff Gen. Lisandro Abadia and his PMA classmate (1962), retired Brig. Gen. Jose Ramiscal Jr.

Abadia was former comptroller of the Army (G-6) while Ramiscal was former J6. Ramiscal is facing 24 graft cases and 148 counts of estafa before the Sandiganbayan for allegedly mismanaging the AFP Retirement and Separation Benefits System (RSBS). A similar graft case was recommended by the Senate against Abadia, and this is still pending with the Ombudsman. Both men were charged by civilian agencies.

In January 2002, the AFP investigated four Army and Air Force officers for their involvement in selling duty-free goods in the black market in East Timor, where they were assigned as part of the United Nations peacekeeping force. The case was so embarrassing to the country that the military leadership threatened to dismiss them from service. Today, the alleged leader of the black market group, Army Col. Allan Bontuyan, is the deputy commander of an Army task force based in northern Mindanao. The military had cleared him.
Garcia undoubtedly knew the military culture well enough to get reckless in the last two years before his scheduled retirement in November 18 this year.

In 2002 alone, immigration records showed that he made a dozen trips abroad—Europe, US, Singapore, Hong Kong—even if his work didn’t require him to do so. The same records obtained by NEWSBREAK showed that the general made seven trips abroad in 2003, including a trip to Europe in early December with his wife, a military aide, and the latter’s wife. After that European trip, Garcia went to the US on Dec. 29, 2003. Between the Europe and US trip was the incident of December 19, when his son was apprehended at the San Francisco airport for failing to declare $100,000. The son was traveling with his younger brother.

It was in 2002, a year after his appointment to J6, that Garcia’s bank deposits and properties rose. That year, his deposits in AFPSLAI reached P7 million. In 2003, he took $200,000 to the US as downpayment for two posh condominium units in New York. From January to March this year, he made three outward dollar transmittals amounting to P27 million.

Estimates show he must have brought P71 million to the US from 1993 to last year, enough to buy 71,000 pairs of boots for soldiers or provide a one-year meal allowance to 6,500 troops.

Marcelo’s shock

Unfortunately for Garcia, Ombudsman Simeon Marcelo has been busy training his field investigators and prosecutors. Bogged down by a meager budget when he was appointed to the post in 2001, Marcelo had to tap grant money to help him improve the work of his staff. Among the aid agencies that have been funding Marcelo’s training programs is the US government’s aid agency that has been working in the Philippines for a long time now—the USAID.

Early this year, upon Marcelo’s request, Usaid brought officials from the US Customs and the Federal Bureau of Investigation to give a lecture to Ombudsman investigators. That’s when Marcelo personally met with officials of these agencies, who have since kept in touch with him. And that’s why Marcelo got to pin down Garcia—not because of some US conspiracy, as raised by Sen. Juan Ponce Enrile and other sectors, to pressure the Arroyo government to be tougher on terrorists.

During an October 9 forum sponsored by the Presidential Management Staff in Malacañang, Marcelo talked about the Garcia affair, which he described as “tsamba” (luck) for his office. “When these US Customs officials were here, they mentioned to me over dinner that they have anti-corruption officials who monitor movement of assets such as in the airports,” Marcelo recalled. “So I told them that since I am investigating officials from the Customs, Department of Public Works and Highways (DPWH), and Bureau of Internal Revenue, perhaps they should help me.” The three agencies are perceived to be the most corrupt. Marcelo asked the Americans to inform him of any suspicious entry of money to the US from the Philippines in the last 12 months, hoping this could yield familiar names from these agencies.

“To my shock and surprise, on September 14 they transmitted to me a list of the amount that General Garcia has brought to the US,” Marcelo said. “It was manna from heaven.”

Garcia’s case has somehow upset the Ombudsman’s timetable. For this year and the next, he has been training his guns on the top three agencies. “My timetable for the military was 2006 yet…but the case is already here and I can’t turn my back on it.”

The military was reluctant at first to give the Ombudsman all the records pertaining to Garcia, Marcelo disclosed. He got all the data he needed by issuing the AFP a subpoena. On September 28, finding a prima facie case against Garcia, Marcelo ordered him suspended for six months without pay.

When the news broke, Abaya could not even persuade Garcia to present himself to the media. The AFP initially refused to produce an official photograph of the man; the media had to rely on a charcoal portrait displayed in his office. Yet, when the military exposed some of its officers for allegedly campaigning for the opposition in the last elections, military officials not only identified them, they immediately had them grounded and recalled to headquarters.

The high command waited almost two weeks after Garcia’s suspension before filing court-martial proceedings against him, and only after the President ordered them to do so. A court-martial case gives the military immediate and total custody of an accused. The delay allowed Garcia to leave his quarters, withdraw P19 million from AFPSLAI, and plot his defense.

‘Comptroller Mafia’

How could Garcia have enriched himself so fast? And why is the military afraid to touch him?

It’s not quite accurate to say that Garcia is a mere sacrificial lamb in this sordid affair. As J6 from March 2001 to September this year, Garcia was a power center all by himself. Officers from captains to generals went to him if they needed approval for more allocation for their units, allowance for their travels, or money for social activities, like Christmas parties.

Besides, Garcia was secure as a member of the comptroller family—an elite bloc of former and current military comptrollers in the AFP and its major service commands. Among the former chiefs of staff who belong to the comptroller family are Abadia and retired general Roy Cimatu.

Officers interviewed by NEWSBREAK call them “the comptroller mafia.” As such, they follow a certain career path that assures them the comptroller post most of the time in their careers, according to a former Army chief. They usually treat combat assignments as mere requirements; they know that they will always land in a comptroller job after months in the battlefield.

In most cases, a comptroller who is scheduled to retire or assigned to the field will make sure that it is officers from the “family” who will replace him, the same source says.

The AFP has a comptroller eligibility list, a short list of military officers qualified to be comptrollers. “Once you’re there, you become associated with the mafia one way or the other,” says an Air Force general. Garcia didn’t spend much time with the comptroller family before he became J6; he used to be logistics officer of the Army (June 1992 to November 1993). However, he began his career in the military as a comptroller for the 51st engineering brigade in the 1970s.

The Army’s engineering brigade is another unit that deserves scrutiny. Garcia spent at least nine years there. Because it does road projects for the national and local governments, the brigade gets its resources not only from the AFP but from the national government as well. It is a beneficiary of pork barrel funds from lawmakers. Ideally, the brigade should just do work for military purposes; some officers say that its mission should be reassessed.

Garcia was the Army’s chief of engineers when he was promoted to J6 in March 2001, shortly after Edsa 2. Gen. Diomedio Villanueva, the chief of staff at the time, told NEWSBREAK that Garcia’s appointment “was already approved by Malacañang” when he took over as AFP boss.

Garcia’s predecessor was Jacinto Ligot, now a retired major general and a known close associate of Angelo Reyes, whom Villanueva replaced as AFP chief and who is now interior and local government secretary. Ligot owns a unit in the posh Essensa Towers in Makati City, says a former defense official.

“They take care of each other,” says the official. When comptrollers are required to take field assignments, chances are they will succeed in these command posts because of financial support from the “comptroller family.” The official adds: “They never fail in the field because bubuhusan sila ng pera ng mga kasama nilang comptroller.”

The source cites the case of former AFP budget officer Army Col. George Rabusa, who is now with the Central Command (Cencom) in the Visayas but who was investigated by the Ombudsman for unexplained wealth in 2002. To take the heat off Rabusa, his superiors sent him to Cencom, which was then commanded by Ligot, his former boss at J6.

The new J6 who replaced Garcia is Brig. Gen. Antonio L. Romero, who also once served as deputy J6.

Arroyo’s flawed style

Garcia is the only J6 to have served five AFP chiefs of staff. Blame this on President Arroyo’s preference during her first term for appointing favorite generals to the top AFP post even if they were to retire in a few months. This somehow ensured Garcia’s tenure because no short-term chief of staff would dare replace his budget adviser.

“I saw no need to replace him when I assumed office,” retired AFP chief Gen. Dionisio Santiago admitted. “Why should I when I would be serving for only four months?” Even if he served for only four months (November 2002 to April 2003), Santiago claimed he was able to finish 14 building projects—and Garcia, he said, made sure all these were amply funded. Aside from Villanueva and Santiago, the other chiefs of staff served by Garcia were: Cimatu (May 2002 to September 2002), Benjamin Defensor (September 2002 to November 2002), and Abaya (April 2003 to November 2004).

Overlooked by Abaya was one of the recommendations last year by the Feliciano Commission that investigated the causes of the July 2003 Oakwood mutiny: for junior and senior comptrollers in the AFP to serve only for two years at the most in their posts.

A former comptroller told NEWSBREAK that it was unwise for the leadership to keep an officer as comptroller until his retirement. “You don’t retire a comptroller at his post because if he turns out to be a bad choice and an abusive one, then you are courting trouble,” he said. He laments that their work has been tainted by abusive officers. “We tried in the past to establish criteria on who can be comptrollers…that it should not be just anyone else…unfortunately, such has been set aside.”

Prized post

Comptrollership used to be a mere technical job.

In the 1970s and ’80s, PMAers looked down on this work so that only the non-PMAers and commissioned officers applied for the post. The prestigious staff positions then were intelligence and operations.

Now it’s the other way around: military classes for comptrollership sometimes have to shut off officers seeking to attend advanced courses for this work. Enrolment in intelligence courses, on the other hand, is thinning.

In the past, commanders and J-staff officers had control of their allocations, but the J6 has emerged as the central clearing house for all AFP money. All the J-staff and major commands now pass their request for allocation to the J6, which has the final say.

Comptrollers in all levels in the AFP (down to the battalions) are the chief financial advisers of commanders on how their budgets may be used. The J6 is the principal financial adviser of the chief of staff. He controls the disbursement of funds in the whole AFP and determines who receives how much. The J6 has the power to evaluate the mission accomplishment reports of these units and determine if they deserve the resources they are getting.

Said the Feliciano Commission in its 2003 report: “Not surprisingly, a commander tends to follow the comptroller’s advice on how [an allotment advice] can be utilized to generate cash or supplies.”
It is the J6 who drafts and presents the AFP budget to Congress for approval. Three officers say the J6 can “to a certain extent” hold the chief of staff hostage because of the special “skills” that he possesses and the dependence of the chief of staff on quick money for operations.

Thus, Garcia was not being forthright when he told a House hearing that his duty as J6 was “simply ministerial.”

Conversion

Still, these powers don’t mean much when one is dealing with a fixed budget that is subject to audit.

But the AFP has institutionalized a “creative” way of converting its allocation to cash with fake receipts from dealers and suppliers with connivance among commanders, comptrollers, and logistics officers. In this system of conversion, the AFP can, for example, request equipment from a certain supplier, who gives receipts for non-existent supplies. The request is approved and converted to cash, but the money goes to operations or to the pockets of commanders. Conniving suppliers get a share as well.

The AFP had to resort to conversion in the 1970s to skirt a very circuitous procurement and disbursement process not suitable for an organization fighting a war. Now, the AFP procurement process has two categories: actual procurement and procurement for “constructive purposes (conversion).” And the AFP has two kinds of dealers and suppliers: the legitimate ones and those who are used for conversion purposes only.
The J6’s operating arm, the headquarters comptroller, does the duty of “converting” the budget for use by units, says former Army Capt. Rene Jarque. This is where generals “convert” their budget for allowances, he adds.

Also, by juggling the allocation for the AFP (its budget this year is P50 billion), the J6 can approve requests for allocation that in reality may go to those who have the power to poke into AFP affairs: lawmakers and the Commission on Audit. At least one congressman who has been quite noisy over the Garcia controversy has benefited from J6 largesse because he controls some of the AFP dealers and suppliers in the “conversion” category, according to two senior officers.

And when an AFP chief retires, it’s SOP for the J6 to prepare a “pabaon” or going-away gift for him, amounting to millions of pesos.

The comptroller is also overall in charge of allocating “defense support fund,” a euphemism for a slush fund. It’s an internal illicit arrangement whereby generals are given monthly allowances of at least P50,000 that are given through operating units and don’t appear in their payrolls.

All this seemed routine for Garcia. Until the heavens fell on him.