Press Release
September 1, 2010


DRILON: The Senate today will pass the resolution which was approved in principle yesterday, urging President Aquino to suspend all the bonuses and other allowances of the members of the governing boards of the GOCCs. I want to emphasize that the resolution covers only the governing boards or the board of directors of the GOCCs. Insofar as the executives and the rank and file employees are concerned, we cannot touch them at this point unless it's part of the comprehensive reform that we intend to do through legislation. The board of directors should only be entitled to per diems as traditionally given to them, but what has happened is that they have abused their prerogative of appropriating bonuses for themselves, who authorized the payment to themselves of 25 months bonus. In other words, the board of directors of MWSS passed a resolution authorizing the payment to themselves of 25 months bonus. This is immoral, indecent and this is something that must be stopped. That is why we have urged the President, through this resolution, to suspend these board members' compensation, except the per diems. Insofar as the benefits and compensation earned by the members of the boards of the GOCCs who sit in private companies where the GOCCs have investments, they should immediately be instructed to turn over henceforth all the earnings that they have from these private corporations to the GOCCs which invested in the said corporations. This is particularly true in the case of the SSS, where the SSS invested billions upon billions of pesos on various private companies, and from there the commissioners who sit in the board earned millions of pesos in compensation, stock option and other perks.

This portion of the compensation of the board of directors should be turned over to the GOCC, not suspended because the GOCC is entitled to this. It is only the benefits that the governing boards get from their own agencies. That must be suspended. Those compensation that they get from outside sources--meaning from the corporations where they sit--should be turned over to the SSS. For example, in the case of Mr. Neri, he earned from Philex Mining, from Unionbank for the last three years, a total of P44,193,964.88. This is already in his hand. And I urge the new leadership of the SSS to recover this amount from Mr. Neri, together with the amounts which Thelmo Cunanan received, which runs to again millions of pesos. Take actions in order to recover this because Messrs. Neri and Cunanan are not entitled to these benefits which they appropriated for themselves arising from the investments of the SSS. I repeat, the SSS invested billions of pesos in funds to these corporations. The SSS is represented in these corporations by Mr. Neri, Mr. Cunanan, et al. The amounts therefore that they receive, on top of per diems, they got it because they represented the pension fund and they have no right to these because these are funds given to them because of the investment of the SSS, not because of their investment.

So I urge Mr. Juan Santos and Mr. Emil de Quiros, the new chairman and administrator of SSS, to institute measures to recover these payments given to their previous SSS commissioners.

Q: Yung turning over kasama ba sa reso?

DRILON: Hindi kasama kasi suspension lang yun eh. Addressed kay Noynoy yun, itong sinasabi ko addressed sa commissioners.

Q: Resolution urging the President...

DRILON: The resolution is of two parts: the first part is asking the President to suspend all the bonuses and allowances of the governing boards of the various GOCCs, and therefore they should only be entitled to per diem for attendance of board meetings. The resolution does not include management and employees of these GOCCs. They are in the regular payroll and therefore they are not covered by the resolution. The second part of the resolution would provide that those sums of money and benefits earned by the governing boards in corporations where the GOCCs would have invested, should be turned over to their agency because they are not entitled to these are these are funds belonging to the pension fund. The resolution on the President covers future payments because the resolution might be interpreted that we are asking for the suspension of the amounts due from the private companies. We are not asking for that, because the GOCCs are entitled to those benefits as these are investments. Those should continue but it should be turned over to the GOCC which they belong.

Q: Medyo mabagal ba ang palasyo? Kinailangan pa ng resolution.

DRILON: Siguro they wanted to see the extent of these abuses before they act on it. Now, it's made public and I'm hopeful that now they would really act on it.

Q: You are expecting immediate action?

DRILON: Certainly. That's why we file the resolution because as we investigate, MWSS board is continuously receiving their bonuses. If you just divide the 25 bonuses by 12 months, that's an average of two bonuses per month. Every month, they would receive two more months of bonus. So there is a need to suspend the bonuses because as we debate and as we do our hearings and as we try to come up with a reasonable proposition on how to respond to this, the bonuses also are accruing to these governing boards. The GSIS, they have P6 million in one year, and you divide that by 12 that's P500,000 / month on the average. There is need really to suspend these governing boards' allowances while we are trying to come up with a solution to this problem.

Q: (inaudible)

DRILON: I would leave that to the agency and the legal department. Tungkulin ng commissioners ng SSS na pangalagaan ang pensyon ng mga manggagawa. Nakita natin ang pang-aabuso ng nakaraang mga commissioners, kanilang binulsa ang karapat-dapat na ibalik sa pension fund ng SSS. Nasa pamunuan ngayon ng SSS ang pagbawi ng mga benepisyo na dapat ibigay sa SSS.

Q: Sinasabi ni Neri that there was no clear law...?

DRILON: Mr. Neri is not a lawyer. As we lawyers understand, Mr. Neri is a trustee, and as a trustee, he is under obligation to account for every single peso the fund that he represents which is the pension fund. Hindi ordinaryong korporasyon ang kanyang hinahawakan, yan po ay ang korporasyon na nangangalaga ng pension ng ating mga manggagawa.

Q: Yung sitwasyon sa SSS ganun din ba sa GSIS?

DRILON: Yung sa GSIS, mukhang wala silang masyadong investments sa mga korporasyon. Wala akong nalalaman na nakaupo sila sa mga private corporations. Yung sa Meralco, I think they have sold that. I am not aware that any member of the board of trustees of the GSIS sits in any private corporation by virtue of the investment of the GSIS. But if they are, the same rule applies to them.

Q: Yung mga nasulatan niyo dating companies sa SSS, sumagot ba?

DRILON: Yes sumagot. Kaya nga may mga data sa PLDT, Philex, Unionbank. Sumasagot sila.

Q: Pero ano yung sa P300,000-P500,000 per board meeting?

DRILON: Galing sa GSIS yon.

Q: Hindi ba too much?

DRILON: To me, the board members are only entitled to per diems. Nothing more, because they do not report regularly to the GOCC. They are not executives of the GOCCs, they are in the governing boards. There is a saying in the private sector that goes something like this: 'You give them peanuts, you get monkeys.' But hindi naman peanuts ang binabayad natin sa mga GOCCs, so we should not get monkeys.

Q: Ang resolution sa SSS at GSIS?

DRILON: SSS and all the other GOCCs which would have investments in subsidiaries or private corporations.

Q: Na identify nyo na lahat?

DRILON: Hindi pa, inaayos ko pa. Meron akong ilang sagot pero I have not consolidated it. For example, LWUA, they have LWUA Consult, they have this bank in Cavite that they have purchased. As of now I could not give you a consolidated list.

Q: Top 5 on your mind..

DRILON: Philex, PLDT, Unionbank, Security Bank, Belle Corp. In the testimony of Neri in the Senate, he enumerated the following as companies where SSS had investments: PLDT (P27 billion), Unionbank (P6 billion), Philex (P14.3 billion), Security Bank (P2.9 billion), Metrobank (P2.4 billion), First Philippine Holdings (P2.9 billion), Energy Development Corp. (P1.4 billion). But it is not in all these corporations that SSS is represented in the board because maybe some of their investments are not sufficient to elect a member of the board. But apart from investments, we would like to find out from Philippine Deposit Insurance Corp. in how many boards in distressed banks sit, who sits there and what kind of income do they earn. Again, that's a classic example that they should turn this over to the government. And I don't mind probably if they're earning their per diems, that's given. But beyond per diems, they should turn it over.

Q: Initially walang commitment si PNoy na mag issue ng EO?

DRILON: I have not talked to him.

Q: Yung resolution parang pressure na rin ba ito sa Malacanang?

DRILON: It's not a pressure. It is consistent with his campaign pledge: Ituwid ang baluktot.

Q: First time ba ito sa Senate, kasi Senate nag-i-issue ng committee report...?

DRILON: This is just a preliminary step that we have undertaken because of the peculiar circumstances, the fact that the bonuses are continuing. It will take us time to debate on the legislation, how the House passes it, to sit in the bicam... Matagal yan. Pending that, we should take this interim step only for the board of directors. Otherwise, the damage will be continuously inflicted on the Filipino people. It's the rationale for that.

Q: (inaudible)

DRILON: That is why this is part of our effort to assist the President. We have secured additional P9.3 billion from the Central Bank and I was just informed by DBP that their new board is meeting today in order to take up my request that additional dividends be declared by the DBP considering that they have P18 billion in retained earnings. Additionally, the dividends from LWUA, MWSS... one of the purposes of our investigation is to find out how much these GOCCs owe the national government and how fast they can remit these dividends.

Q: DBP's commitment?

DRILON: I don't know if it's today, but certainly that they will take it up in the board.

Q: Nabanggit nyo na may 157 GOCCs, may abuses ba dun isa-isa?

DRILON: I cannot say that. I'm in the process of reading all the responses.

Q: On 2011 budget

DRILON: I'm trying to schedule next week a briefing of the Development Budget Coordinating Committee. I hope to be able to do it next week, but Sec. Abad is scheduled to take a trip next week so I'm trying to schedule a hearing before he leaves.

Q: Kasama ang mga cuts sa GOCCs?

DRILON: The cuts in GOCCs are actually... that's in the authorization letter, that's in actual monies. When they say 'we cut the subsidy from P14 billion to P7 billion', it does not mean that there's a savings of P7 billion. It only means that the authority to spend for the subsidies of the GOCCs is being reduced. There's more authority to spend.

Q: How about yung retained earnings na ine expect natin?

DRILON: That goes into the General Fund. In the same manner that the subsidies would come from the General Fund.

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