Press Release
May 25, 2011


On the reconvening of the bicam panel on GOCC bill

DRILON: We reconvened the bicameral conference committee on the disagreeing provisions of SB 2640 and HB 4067 for the principal purpose of removing from the coverage of the law the Manila Economic and Cultural Office because of diplomatic and political implications of the inclusion of MECO. MECO is the representative of our country in Taiwan and it is organized under the Corporation Code as a private corporation. It has taken its status very seriously so that they have not been audited by CoA, notwithstanding the fact that they have been collecting public funds. The excess of the funds are not turned over to the National Treasury but I think to the President's Social Fund. They set their own terms of compensation including a very generous retirement plan to the board of directors, where after attending 24 board meetings in Taiwan, they can retire at P600,000 per year of service. All of these prompted the committee and the authors of this measure and the bicam to agree that MECO should be subjected to stricter rules of governance as outlined in this measure. But the Secretary of Foreign Affairs has made a representation to us that this could have political and diplomatic implications. Notwithstanding my previous agreement with the board, Chairman Amadeo Perez has apparently changed his mind. We do not want to have this bill snagged because of that one issue and therefore we have agreed to the exclusion of MECO. However, let me already put on record that as chairman of the Oversight Committee on Public Expenditures, I will closely monitor the operations of MECO and I hope that they stop this practice of not turning over to the national coffers their excess funds, because I will file a case for malversation of public funds if they continue with this practice of appropriating for themselves, without any authority, public funds which should be remitted to the National Treasury. I warn the board and the officers of MECO, while you have excluded yourselves from this measure because of the political and diplomatic implications of considering MECO as GOCC, it doesn't mean that Congress will be remiss in its duty to our people to monitor your operations particularly your use of public funds. That is the major amendment that we had to agree upon in this bicam and with this agreement between the two panels, we expect the measure to be ratified either today or by Monday in the House and in the Senate and we expect the President to sign it afterwards as this is one of the priority measures enumerated in the LEDAC. We hope that this is now the start of the reform in the government corporate sector. I presented this measure before the Asian Network on State-owned Enterprises last week--a gathering of state-owned enterprises in Asia--in a seminar sponsored by the OECD, a Europe-based organization. As we all know OECD is an organization of European countries which monitors the use of development funds among beneficiary-countries. There were praises for this initiative led by Congress and they are looking at it as a model legislation for our jurisdictions to look at. Therefore we are happy that both houses of Congress were able to enact this first reform bill under President Aquino's administration. This was specifically mentioned by the President in his SONA as an issue of good governance and therefore we are glad that we were able to craft this measure which will now put into practice the good corporate practices in the private sector into government operations.

Q: Sir you also agreed to exclude economic zones sa coverage...

From the very start they were excluded. It was never the intent to be included because the economic zones authorities are covered by the salary standardization law and they draw their budget from the national budget. In other words they don't have a free hand in setting their own terms of employment. The intention was really to exclude them except that the phrase in the enumeration which is "including but not limited to," concern was raised that it could include them so we just clarified that it was not the intention to include them principally because they are covered by the SSL and their employees are basically national government employees.

Q: What about Rep. Lagman said na yung security of tenure natatamaan at yung dapat yung reorganization dapat legislature lang hindi sa GCG?

The rank and file employees are not covered by this law. In fact there is a statement there "non-diminution of benefits" so you could not even reduce their benefits. There is no security of tenure involved insofar as the rank and file are concerned because they are not covered by this law. What this law covers is the board of directors and tenure of the board of directors is one year under the law. The security of tenure is one year under the law. That's all that we did instead of having 5 years set in the law, we now have a uniform one year. At present, various GOCCs have their own terms and there is no accountability. The moment they are there, you cannot check their performance because they are there for 3-4 years. What we have done is to set the term for one year so there is a yearly review of their performance and there is a judgment as to whether they are deserving of another term. This concept is patterned after corporations organized under the Corporation Code. Under the Corporation Code, board of directors have one year. Of the 157 GOCCs, 100 of them were organized under the Corporation Code which would have one year term for the board of directors and the chief executive officer. What we did was even if you are a chartered corporation, your term should follow that of one year. So there is no issue of security of tenure because they have security of tenure for one year. After one year, their performance is evaluated if they are eligible for reappointment.

Q: So sir walang basis yung sinabi ni Rep. Lagman na it can be challenged in court?

Anyone can challenge it but we are confident insofar as reorganization. Cong. Lagman said reorganization is a power of Congress. I agree, it is indeed a power of Congress. But what we have done under Sec. 5 is to delegate this to the Executive which has been done in the past under reasonable standards and there are standards to be exercised under this delegated legislative power. In other words, if the exercise of the reorganization power is not in accordance with the standards set forth in Sec. 5 of the law, there is abuse of discretion on the part of the GCG. Now, I must emphasize and as submitted by Cong. Lagman that presently, the Administrative Code allows reorganization of the Office of the President even without an act of Congress, but this has been expanded to include the entire bureaucracy as affirmed by the Supreme Court in a case decided. What in fact this law will now do is to limit the wide latitude of reorganization by the President by imposing standards for the exercise of that power insofar as GOCCs are concerned. Contrary to the statement that this gives the President broad powers to reorganize, in fact this law will now impose standards for the exercise of that power as against the almost unlimited powers of the President under the Administrative Code.

Q: So are you telling us na kailangan yung board of directors to prove themselves qualified for reinstatement...

Not reinstatement, reelection. The board members have a one year term. They have to be reappointed. Therefore it must be shown by a pre-established standard of performance that they deserve to be once more reelected or reappointed to the board, following the fit and proper rule that we have imposed as a standard for reappointment. Samakatwid, yung manikurista ay hindi mo na pwedeng i-appoint sa Pag-Ibig.

Q: Kahit na ilang beses silang i-reappoint pwede?

Walang limitation. But they must account for themselves every year.

Q: Rep. Lagman said the Houes minority will not sign the bicam report. May epekto po ba ito?

There is no effect because we are ruled by the majority. In other words, as long as there is a majority... otherwise it will be the rule of the minority.

Q: Unusual po ba na ma-reconvene ang bicam kahit na na-approve na yung bill?

That is allowed. We withdrew the previous agreement and we signed again every page.

Other issues

Q: Nag file ng MR and SolGen sa Sandiganbayan on Garcia plea bargain...

I am not very optimistic that the reconsideration will be given due course. But under the rules you must exhaust all legal remedies before you can go to the Supreme Court. And what was the SolGen did was to exhaust all the remedies including filing a motion for reconsideration. But as a lawyer and having examined the situation, I am not optimistic that the Sandiganbayan will reconsider. Sa aking tingin, ibabasura ng Sandiganbayan ang MR ng SolGen hindi dahil sa walang merit ang MR kundi dahil ito ay ginawa na nila at paninindigan na nila ang kanilang desisyon.

Q: Hindi ba parang nagsasayang lang ng oras?

Hindi tayo nagsasayang ng oras dahil yan ang patakaran sa rules of court. There is the danger that the SC will not entertain the petition of the SolGen if a motion for reconsideration has not been filed because the theory is that the respondent-court, the Sandiganbayan, must be given an opportunity to correct itself before you go to the SC.

Q: (inaudible)

There is merit in the position of the SolGen and that is the same position that I have taken during the hearings. It's difficult to predict what the Supreme Court will do at this point.

Q: Come budget time, pwede po bang ang Sandiganbayan ay pagpaliwanagin?

Certainly. I will ask them. That is the opportunity where even the Judiciary, particularly the Sandiganbayan, would have to explain to the people through the people's representatives their action.

Q: Possible kasi na pag na-elevate ang SC pwede ulit sabihan ang Sandiganbayan na i-review?

If the Supreme Court finds merit in the SolGen's petition, it can void the plea bargaining agreement. The SC can declare the plea bargaining agreement as void and therefore order again the detention of Garcia since plunder is a non-bailable offense. If the plea bargain is voided, the original charge of plunder is reinstated and Gen. Garcia goes back to detention.

Q: Si Justice Morales na bet ng Malacanang para sa Ombudsman sinasabing too old to hold the position.

I know personally Justice Conchita Carpio-Morales. She is just ahead of me by one year in law school and therefore I do not consider her old. But honestly, she's very competent, she's very qualified, and she has the respect of the general public. Remember that the Ombudsman sa ating lenggwahe yan ang sumbungan eh kaya kailangan respetado ang nakaupo dun. In fact, in my view, the Ombudsman should not be authorized to prosecute. Under our Constitution, it is the tanod-bayan or the special prosecutor who is authorized to prosecute. Under the proceedings of the Constitutional Commission when they crafted this provision on the Ombudsman and the special prosecutor, the concept was the prosecution will be done by the special prosecutor. The conceptualization was that the Ombudsman--which is of European origin--is somebody of stature whose mere statement should correct wrong practices in government. The Ombudsman should be somebody who is a respected citizen. I am now reviewing the powers of the Ombudsman to see if this grant of the prosecutorial power should be removed because that is not consistent with the debates in the Constitutional Commission.

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