Rep. Winston “Winnie” Castelo (LP, Quezon City) today urged President Benigno Aquino III to assume the post of a powerful disaster management czar to address every national calamity situation.

In a statement, Castelo also called for the inclusion of disaster management and preparedness in the elementary school curriculum, saying this is an issue that should be taught to children in their formative years.

Although the Republic Act 10121, or the Philippine Disaster Risk Reduction and Management Act of 2010, has named the defense secretary as chair of the National Disk Reduction and Management Council, the key and decisive disaster management player is the President, Castelo said.

As the take-charge guy in every calamitous situation, the disaster management czar will have to address four major areas: disaster preparedness, disaster mitigation, emergency response, and post-disaster rehabilitation of victims.

Also, according to Castelo, the time-honored spirit of bayanihan should be inculcated into the mind of schoolchildren, as they get educated on the necessity of disaster management.

RA 10121 empowers the defense secretary, as chair of the National Disaster Risk reduction and Management Council, to coordinate government agencies to act on every calamity and mandates the teaching of disaster management and preparedness to high school and college students.

Congress could look into the possibility of providing the President with additional powers to become the disaster management czar, particularly post-disaster rehabilitation of victims, which is considered crucial in disaster management.

Congress could amend RA 10121 to mandate the teaching of disaster management and preparedness to elementary school children, Castelo said, even as he noted that schoolchildren are the frequent victims of calamities.

The disaster management czar should be empowered to manage disaster risk reduction and operations during crisis situation, provide better disaster mapping nationwide, and identify all areas prone to disasters, and the adoption of disaster preparedness programs at grassroots level.

“This is the age of disasters – both natural and man-made,” Castelo said. “We have no choice but to adapt, as Mother Nature exacts its vengeance for all the abuses that have been committed by man.”

Typhoons, storms, tropical depressions, and weather disturbances visit the nation regularly, triggering huge winds, heavy rainfalls, floods, and landslides that kill and maim people, render them homeless, and destroy crops and property, Castelo said. Also, the country lies along the “belt of fire,” which means devastating volcanic eruptions, lahar flows, earthquakes, and tsunamis.

Moreover, extensive drought, mass pollution and poisoning, and epidemics, or pandemics, whether natural or man-induced, also occur regularly, Castelo said.

In some parts of Mindanao, where a mini-war has been waged for decades, disasters happen, as civilians get caught in the crossfire and its adverse effects like famine, Castelo observed.

The global warming and the melting of the polar caps create havoc on this planet, as seawater level rises and climactic changes crop out with unpredictable effects. All told, these catastrophes mean human misery, Castelo said.

“Despite all these disasters, the country has not had a clear disaster management policy and strategy. Everything is left to chance,” Lacson said.

“Whenever disasters strike, the response is predictable: evacuate the victims to safer ground like public school buildings and provide them with bags of relief goods that consist of rice, noodles, sardines, and used clothing,” Lacson said. “Disaster preparedness or mitigation is non-existent. Post-disaster rehabilitation is hardly known. Everything is ad hoc or left to chance.”

The lack of disaster management is felt most in the absence of efforts to reduce disaster risks and mitigate the development of hazards into disasters, Lacson said.

Initially, Lacson suggested the immediate enactment of a law that would create the National Disaster Management Commission, a body that will replace the National Disaster Coordinating Council (NDCC), which, he said, has been largely ineffective to mitigate disasters because it is merely a body that coordinates other government agencies in times of disasters.

The NDCC should be converted into a National Disaster Management Commission, a much stronger body, which will possess enormous powers to meet disasters and will not be an adjunct of the Department of National Defense, Lacson said.

The proposed body should be a collegial body to be headed by a chairman, who will function as a national disaster management czar with powers to orchestrate the development of a national disaster response plan and program, marshal resources for its implementation, and implement it, Lacson said. The czar should have a Cabinet rank.

This blatant lack of disaster management policy became clear when typhoon “Ondoy” brought massive floods in Metro Manila and adjoining provinces last year. The government was reduced to a helpless and powerless body to handle the crisis situation, Lacson said.

In the first “golden hours” (or the first six to eight hours after a crisis breaks), the government was absent. Key leaders were immobilized by indecision and confusion. The next hours showed little – or almost negligible – government response. In most cases, disaster victims were left to fend for themselves, Lacson said. “I was in the middle of the flood trying to help evacuate some people in Pasig, and it was truly chaos. Government was palpably absent.”

At present, the NDCC’s job is to coordinate the various agencies that deal with disasters and calamities. Since its job is coordination, the NDCC is often limited to evacuation efforts and feeding of disaster victims. The more compelling aspects of disaster management, which are mitigation and post-disaster rehabilitation, are not emphasized, Lacson said.

“The NDCC represents our past failures to meet one disaster after the other; it has become a disaster itself, Lacson said.

The proposed disaster management code should empower the disaster management commission to direct all local government units, including the barangays, to work with the relevant agencies and scientific experts to conduct mapping operations to identify those specific disaster-prone areas, Lacson said.

Subject to broad guidelines and the management commission’s supervision, these LGUs should come out with their disaster management programs in their specific localities. In brief, while the disaster management policy is national in scope, it is essentially local in orientation and operations, as it mobilizes LGUs, Lacson said.

Moreover, the national disaster management commission should have broad powers to mobilize the private sector, specifically the civil society and the Church, to help disaster victims during emergency responses

Rep. Winston “Winnie” Castelo today described as “long overdue” the program to provide free hospitalization to 5.2 million poorest families, but said a portion of the proposed P40 billion conditional cash transfer (CCT) fund in 2012 has to be realigned to fund and sustain the program.

In a statement, Castelo (LP, Quezon City) praised Health Secretary Enrique Ona for crafting a program providing the Filipino people the universal access to health services, but said funding support has to be identified to ensure its sustainability and success.

“The ‘Health for All’ program of the Department of Health is in the right direction, although long overdue. It needs all possible support to ensure its success,” Castelo said.

Castelo suggested a realignment of at least P10 billion or 25 percent of the P40 billion CCT fund, which the Department of Social Welfare and Development (DSWD) will administer under the proposed 2012 national budget, to finance the free hospitalization program.

“The use of the conditional cash transfer fund to meet the health requirements of the poorest families will mean its prudent use,” Castelo said. “It’s a better option than doling it out to the poor.”

Castelo said the DoH’s free hospitalization program will require the compulsory enlistment of these beneficiary-families under the national health insurance system, which the Philippine Health Insurance Corporation (PhilHealth) administers.

The P10 billion CCT fund could be used to pay for the regular monthly premium contributions of these families, which are considered “poorest of the poor,” Castelo said.

Under Republic Act 7875, or the National Health Insurance Act of 1995, the National Government is mandated to pay for the premium contributions of “indigent families,” who are not in the position to pay them regularly due to poverty and lack of means.

By using the CCT fund for the health requirements of the poorest families, the National Government will also satisfy the mandated compulsory enrollment of all Filipinos within a 15-year period since PhilHealth’s establishment in 1995 and the remittance of their regular monthly premium contributions. #

Rep. Winston “Winnie” Castelo today urged the Department of Health (DoH) to hasten the implementation of the free hospitalization program for the 5.2 million “poorest of the poor” families, even as he asked for a realignment of a portion of the proposed P40 billion conditional cash transfer (CCT) fund to finance and sustain the program.

In a statement, Castelo (LP, Quezon City) praised Health Secretary Enrique Ona for crafting a program that provides the Filipino people the universal access to health services, but said this requires its fast tracking because of the rising incidents of dengue fever and other major ailments in the country.

“The ‘Health for All’ program of the Department of Health is definitely in the right direction, although long overdue. It needs all support to ensure its success,” Castelo said adding that its funding support has to be identified to ensure its sustainability and success.

Castelo suggested a realignment of at least P10 billion or 25 percent of the P40 billion CCT fund, which the Department of Social Welfare and Development (DSWD) will administer under the proposed 2012 national budget, to finance the free hospitalization program.

“The use of the conditional cash transfer fund to meet the health requirements of the poorest families will mean its prudent use,” Castelo said. “It’s a better option than simply doling it out to the poor.”

Castelo said the DoH’s free hospitalization program will require the compulsory enlistment of these beneficiary-families under the national health insurance system, which the Philippine Health Insurance Corporation (PhilHealth) administers uder Republic Act 7875, or the National Health Insurance Act of 1995.

The P10 billion CCT fund could be used to pay for the regular monthly premium contributions of these families, which are considered “poorest of the poor,” Castelo said.

With the National Government paying at least P100 per month as regular monthly premium contribution for every for every indigent family, the Health for All program could be genuine and sustainable.

RA 7875 mandates the National Government to pay for the premium contributions of “indigent families,” who are not in the position to pay them due to poverty and lack of means.

By using the CCT fund for the health requirements of the poorest families, the National Government will also satisfy the mandated compulsory enrollment of all Filipinos within a 15-year period since PhilHealth’s establishment in 1995 and the remittance of their regular monthly premium contributions. #

Rep. Winston “Winnie” Castelo (Quezon City, LP) today pushed for the adoption of a ten-hour, four-day, or 10/4, work week in both public and private sectors to save on cost and enable workers to have extended weekend with their families.

The proposed 10/4 work week formula does not change the traditional 40 hours of work every week, according to Castelo, who is set to file the bill, to be dubbed as the “Four-Day Work Week Act of 2011.”

“It will still be 40 hours a week, but the work schedule will run from Monday to Thursday instead of until Friday. Public and private sector employees will put in two additional hours of work daily,” Castelo said.

“”There won’t be any reduction in the required 40 hours of work every week, nor any cut back in service or productivity,” Castelo said.

Castelo said the 10/4 formula could mean weekly savings of at least 20 percent in work expenses, stressing it can serve as a “poverty alleviation” program by itself for cash-strapped workers.

If a worker in Metro Manila spends P200 a day in transport fare, food and snacks, and other expenses in going to work, or P1,000 every week, Castelo said the 10/4 work week will mean a savings of P200 per week. For workers in the provinces, who spend a daily average of P100, the weekly savings could be P100, Castelo said.

Overall, the proposed 10/4 work week could mean weekly savings amounting to at least P20 billion for the over 20 million private sector workers and 1.5 million state employees.

The 10/4 work formula seeks to address the economic difficulties caused by rising prices and stagnant wages, Castelo said, as he noted that the continuing increases in the prices of petroleum products have triggered a corresponding rise in the prices of goods and services.

Castelo said the three-day extended weekend can make employees more revitalized and motivated, as they have more time to spend with their families and pursue other activity, including hobby and leisure.

Also, the additional day-off can push workers to pursue other productive activity, including learning new skills to retool himself and hone his competitiveness in the labor market, Castelo said.

In the end, the 10/4 work week can provide a positive impact on the worker’s morale and productivity in the workplace, Castelo said.

For the employers, the 10/4 work formula can result in savings in maintenance cost and employees’ overtime pay, Castelo explained.

Castelo said the 10/4 work week formula is already being enforced at the House of Representatives with what he has described as resounding positive effects and enormous savings on government.

“Employees at the House of Representatives start at 8 am and end up at 7 pm for a total of 10 hours of work every day. Yet service and productivity is never compromised by the shorter work week and longer weekend,” Castelo said.

It is almost a done deal, but controversy hounds the merger of the dominant Philippine Long Distance Telephone Company (PLDT) and smaller rival Digital Telecommunications Philippines Inc. (Digitel). Despite the approval by the regulatory National Telecommunications Commission (NTC) of the biggest corporate deal in the nation’s economic history, certain questions beg for answers.

From the P72 billion PLDT-Digitel share swap deal, a bigger PLDT emerges as the surviving entity to control at least 70 percent of the nation’s information and communications (ICT) sector. As their owners and executives gloat over the PLDT-Digitel merger, these questions arise: Will the merger lead to cheaper, improved, and efficient telecommunications services for the Filipino people? Will it redound to a more vibrant, dynamic, and competitive telecommunications sector? Or will it mean the re-emergence of the PLDT monopoly?

Legal complications

Strangely, the NTC flashed the green light despite the reported deliberations by the Supreme Court on the motions for reconsideration, which several parties, including PLDT, have filed against an earlier SC decision, which defines PLDT as a foreign firm that mocks the constitutional cap on foreign equity in public utility firms.

In the case filed by the late lawmaker Wilson Gamboa, the Supreme Court said in its ruling that only the common shareholding, not a combination of common and preferred shareholdings which the PLDT has been insisting, is the basis for computing the foreign equity in a public utility firm like the PLDT.

In the Gamboa v. Teves (GR No. 176579, June 28, 2011), the SC majority opinion penned by Associate Justice Antonio Carpio said PLDT has been violating the constitutional cap on foreign equity as foreign entities own more than 60 percent of the common shareholdings of PLDT. Citing the 1987 Constitution, the SC said that foreigners can own up to only 40 percent of common shareholdings, as the Constitution seeks the “effective control” by the Filipinos of the national economy.

The NTC should have waited for the Supreme Court to rule on the motions for reconsideration filed by PLDT and other parties. But with the NTC approval, the PLDT-Digitel faces legal complications, as legal challenges are to appear the moment the high tribunal dismisses those MRs. It is not clear how the two telcos would face the legal impediments.
‘Conditional approval’

The NTC has approved the PLDT-Digitel merger subject to three conditions: permanence for the unlimited calls and texts under the Sun Cellular brand; divestment and sale of the 10 Mhz 3G radio spectrum of PLDT’s Connectivity Unlimited Resource Enterprises to another wireless party except PLDT; and reduction of interconnection rates to assure PLDT’s interconnection with other carriers, big and small.

Although the NTC appears bent to pursue the three conditions, they are fundamentally insufficient to promote a dynamic, competitive, vibrant, and efficient telecommunications sector. They do not necessarily mean they could bring up the sector to the next level.

The wireless subsector has developed over the past two decades to mature considerably. This maturity means cheaper and better services, which are sustainable for a prolonged period. Hence, a regime of expensive wireless call and text messaging services is now a thing of the past. It is unthinkable – or impossible – with or without the PLDT-Digitel merger.

The emergence of a third wireless player in Digitel in 2003 proves that a regime of cheaper text messaging and call services is possible to provide the people with greater and more flexible access to telecommunications services. A three-party wireless subsector has proven to be more vibrant and competitive than a two-player wireless subsector.

Also, the interconnection template has been ironed out three years ago. Players – big and small – are required to interconnect their subscribers, resulting in cheaper services. Players could not escape interconnection because it is the heart of providing universal access to telecommunications services. Without interconnection, all players and subscribers suffer.

Also, the bigger PLDT cannot possess its current radio frequencies without giving up something in exchange for a future advantage, which is its emerging financial heft to ease out competitors. CURE, a PLDT subsidiary, has limited subscribers, which the bigger PLDT could sacrifice for an advantage. Giving up its radio frequency is no big deal.

Hence, the NTC is unwittingly helping the bigger PLDT to dominate further the telecommunications sector. To say that the conditions are being imposed to protect end-users and make the market more efficient, vibrant, and competitive is nonsense.

Missed opportunity

The NTC had the technical capability, financial know-how, and luxury of time to go over the PLDT-Digitel merger and impose additional conditions, but it neither had political will nor vision to do it.

Take Internet connectivity. Rapid global developments have pushed most nations to hook their citizens to the international information superhighway to hasten economic growth and development. But local Internet penetration is low, putting the Philippines in the dark ages in Internet connectivity.

The NTC should have asked the bigger PLDT to lower the high cost of Internet connectivity to enable more Filipinos to gain access to the worldwide information and communications network. The costly Internet connectivity has been the bane to accessing the global information superhighway.

Because of the PLDT-Digitel merger, the bigger PLDT will control six of the seven international submarine cables and four of the five cable landing stations, putting most Internet facilities under its control. As Internet-friendly gadgets become available to end-users, Internet connectivity cost should go down.

The NTC should have addressed the Internet connectivity cost if it wants to raise Internet penetration, which is below 10 percent for the country’s population of 100.2 million. This is a missed opportunity for the regulator.

Failure of policy

In 1995, Congress has had enacted Republic Act No. 7925, or the Public Telecommunications Policy Act, to deregulate the telecommunications sector and dismantle the PLDT monopoly. The policy shift had created a liberalized atmosphere, enticing new entrants. But it did not necessarily lead to a more competitive environment, as the new players later sold out their stakes and exited from the ICT sector.

The duopoly of PLDT and Globe Telecom has supplanted the then lethargic and counterproductive PLDT monopoly of the pre-1995 era. But the duopoly is being seen as the perpetrators of cross subsidy and predatory pricing to ease out any third player or discourage new entrants.

While Digitel’s entry into the market had provided competitive challenge to the duopoly of PLDT and Globe Telecom, the consequent decline in the prices of telecommunications services among the three players reflected predatory pricing that led to Digitel’s financial difficulties. Digitel had no choice but to join and merge with the nation’s biggest telecommunications firm.

In short, the PLDT-Digitel merger is indicative of a policy failure. While RA 7925 has rid the nation of a monopoly, it has failed to stop the duopoly from emerging, triggering market distortions, which include predatory pricing practices and cross subsidy that led to cheaper text messaging and call services, but expensive and erratic Internet connectivity.

RA 7925 has been inherently infirmed to meet and sustain the challenges of a multiplayer telecommunications environment, while the NTC lacks the political will to tackle a liberalized market.

Policy options

Statesmanship requires new policies to rein in the duopoly of the emerging bigger PLDT and Globe Telecom. The two policy options are the passage by Congress of an antitrust law or the imposition by the NTC of obligations on telecommunications firms that enjoy significant market power.

These policy choices find expression in Section 19, Article XII of the 1987 Constitution, which says: “The State shall regulate or prohibit monopolies when the public interest so requires. No combinations in restraint of trade or unfair competition shall be allowed.”

No less than President Benigno Aquino III, in his 2010 inaugural address, has unveiled the urgency of an antitrust law, saying it as one of the priority legislations. The proposed antitrust law seeks to slow down expansion of conglomerates, or dismantle monopolies and oligopolies to stop market distortions.

The planned policy mix provides additional obligations on the bigger PLDT and Globe Telecom, which will have a combined market share of 99 percent of the wireless subsector, 96 percent of the fixed line subsector, and 95 percent of the data services, or Internet subsector. These obligations are telecommunications services at “just and reasonable prices, terms and conditions” on a “nondiscriminatory basis” and upon “reasonable request.”

Asymmetric regulation

The imposition of obligations on carriers with significant market power stems from the asymmetric – or skewed and uneven – distribution of market power in the domestic telecommunications sector. The largest two carriers, or the duopoly of the bigger PLDT and Globe Telecom, among the 70 or so local exchange operators account for 90 percent of the subscriber base and more than 95 percent of the wireless, fixed line, and data subsectors.

Ergo, asymmetric regulation is the logical regulatory response to the asymmetric market situation. Those carriers that control the market would have to follow a different set of rules in what appear to be like a handicapping system in horseracing.

In an earlier paper, the NTC had explained that large carriers, which own and control costly infrastructure, could eliminate competition by denying rival carriers access to their facilities, which the smaller rivals need to provide services.

The same principle applies to incumbents, which, by being the first in the market, enjoy the advantages not only of control of essential facilities and network standards but also of customer inertia since many customers would avoid the cost of switching service providers.

Moreover, an incumbent carrier with vertically integrated facilities can cross subsidize its services and engage in predatory practices in market segments threatened by competition.

Predatory practices

The data subsector showed predatory pricing practices, when the PLDT-Globe Telecom duopoly competed with and eliminated later those independent Internet service providers (ISPs). These ISPs had to pay interconnection fees, losing to dominant carriers, which provide the same Internet services at a lower cost.

This is one of the reasons for the costly Internet connectivity, which is a major barrier for improved Internet penetration in the country.

Incumbents’ response

For the past three or four years, the duopoly of PLDT and Globe Telecom has been opposing the imposition of additional obligations for carriers possessing significant market power. In fairness, they have legitimate reasons to oppose these policy initiatives, believing they could lessen their tight grip on the telecommunications sector.

For instance, Globe Telecom argued that the NTC could not impose them without undergoing a judicial challenge. Globe Telecom claimed that the competition policy is constitutionally infirmed, as it violates the equal protection of the law doctrine.

PLDT opposed the competition policy on the ground that “holding substantial market power does not equate to holding or exercising market power.” On the contrary, PLDT argued that “bigness is not a crime” and the current competition has been “robust” and “effective,” as shown by indicators such as price declines and service innovations.

PLDT argued that international aircraft manufacturing has been dominated by Boeing and Airbus, but their competition has been intense and robust, leading to the production of airworthy aircrafts. PLDT chair Manuel Pangilinan argued that the Philippines should be like Hong Kong, which has two telecommunications players that compete vigorously.

These two arguments are fallacious. The aircraft manufacturing sector has the entire world as its market. The Philippines with its population of 100.2 million by end-2010 could not be compared with Hong Kong, which has a population of 5.3 million.

Because of the two telcos’ opposition, the NTC had shelved further discussions on the adoption of any competition policy or imposition of obligations on carriers enjoying significant market power. This is a policy option that has been relegated to oblivion since 2007.

Weak NTC

Had the NTC allowed the additional obligations some three or four years ago, the telecommunications sector would not be rattled by the PLDT-Digitel merger. As the main telecommunications policymaker outside Congress, the NTC could have redefined the market and make it transparent and competitive.

But the NTC is weak to handle the policy regulatory issues that have fallen on its lap. It is a victim of “industrial capture,” as it could not respond adequately to the issues and challenges posed by the duopoly.

Congress has to craft a law to strengthen the NTC. Hence, the NTC has to be empowered to conduct inquiries, hearings, and investigations and decide on the basis of information secured through public hearings, official notices, and solicitations for data. The NTC commissioners should have a fixed tenure of office. Its staff has to be retrained.

Policy revival

The bigger PLDT would hardly lead to a monopolistic situation. The scenario is a stronger PLDT-Globe Telecom duopoly taking a deeper root – and, ergo, a stronger hold – in the telecommunications sector. They have to enter into a modus vivendi for their mutual advantage. All talks of a telecommunications “war” between the two telcos are just talks.

The policy revival to impose obligations to the two firms enjoying significant market power is the right policy. The question is whether to strengthen first the NTC through a new legislation, or impose those obligations even under an effete NTC. Also, the obligations have to be identified too. This is a policy issue that has been to be answered by no less then the President himself.

Or shall Congress proceed to enact the pending bill on competition policy? Or shall it enact the pending antitrust bill, which the Legislative-Executive Development Advisory Council (LEDAC) has shelved to give way to the other pending bills?

Other policies

The market does not have to wait on how the PLDT-Globe Telecom duopoly will behave. As a rule, monopolies, oligopolies, and cartels kill competition and create market distortions at the expense of end-users. Hence, the duopoly is not something to be trusted.

Some policies have to be enacted to deter market abuses by the duopoly. Vigilance has to be exercised.

Other policy recommendations:

1. Mandatory policy to push big telcos to serve unprofitable and hard to reach rural areas. Congress can pass a law requiring the identification of these areas and mandating the nearest telco’s point of presence to hook these areas into their broad backbone through state agency Telecommunications Office.
2. Full adoption of the Voice over Internet Protocol (VOIP) technology as an alternative for overseas calls primarily to lessen the digital divide and initiate an era of cheaper overseas calls; and
3. Inventory of all radio frequencies and their rationalization so that smaller telcos would radio frequencies to serve rural areas.

Conclusion

The twin issues of PLDT-Digitel merger and stronger PLDT-Globe Telecom duopoly has to be addressed before it becomes too powerful to reach the point of no return. Corporate power bequeaths political power. Hence, appropriate policy changes have to be pursued to assure universal access to telecommunications services.

Congress has to enact an antitrust law and an overall competition policy. The Supreme Court has to rule on the foreign equity issue of the PLDT. The NTC has to be strengthened as a regulatory agency. Unless those policy initiatives are pursued, the duopoly will redefine the telecommunications sector at will with the end-users at their mercy.

About the author: Rep. Winston “Winnie” Castelo is a neophyte lawmaker representing the second district of Quezon City in the House of Representatives. He belongs to the Liberal Party. He was a member of the Sangguniang Panglunsod for four terms before his election to Congress. He is an AB Philosophy graduate of the University of the Philippines.

Rep. Winston “Winnie” Castelo today described the goal to eradicate completely the widespread corruption in government as possible to achieve in 2015, but said this objective would require the full mobilization of the public and private sectors to develop an anticorruption culture and the deployment of a “critical mass” of supporters to enforce the anticorruption laws.

While describing the current anticorruption campaign as a “sequel” to the 1986 EDSA Revolution and the “centrepiece program” of the Aquino administration, Castelo (Liberal Party, Quezon City) said “a different, albeit special, kind of political will be necessary to drive away from public service the corrupt elements.”

Castelo has proposed a set of initiatives to strengthen the anticorruption campaign. These include:
· increase in the budget of the Office of the Ombudsman to at least one percent of the annual national budget; · sustained lifestyle check of public officials;
· enactment of a law protecting whistleblowers;
· empowerment of the private sector to go after corrupt public officials,
· development of a mass culture that rejects corruption as a way of life, and
· creation of an “anti-corruption army,” which would involve and represent a critical mass of ordinary citizens, who would run after corrupt public officials.

Castelo said he has based his anticorruption agenda on complete cooperation of the public and private sectors, stressing that it requires the full involvement of the private sector, which includes the Church, civil society, business community, the academe, and even the youth and young professionals, who have bigger stake in the nation’s future.

“What we need now a new social movement that would reject corruption as a way of life and usher a new mass culture that highlights integrity in public service,” Castelo said. “Anything short of a mass movement would lead to failure.”

Castelo defined corruption is the use of power for private gain. It involves public officials, who use their power to extort bribes and private persons, who bribe officials to gain advantage or secure profitable government contracts. Corruption impedes national development, discourages investments, and negates moves to make the country as globally competitive as possible. It denies the poor the access to public services, as the government loses resources, Castelo added.
While saying that the country has become notorious for being one of the most corrupt nations in Asia, Castelo stressed it has to develop the political will to confront and tackle corruption, but warned it cannot leave the anticorruption agenda to the government alone since “it neither has the wherewithal, the political will, nor new ideas” to handle corruption. An anticorruption agenda requires the full participation and mobilization of the government, civil society, the Church, business community, and the youth in a social movement against it, Castelo said.

“Their mobilization and participation would be crucial to reduce corruption to zero level by 2015,” he said.

Initially, the budget of the Office of the Ombudsman should be raised because its current budget of 0.7 percent or less of the national budget is insufficient, Castelo said. “Raising it to at least one percent of the national budget would signal the serious policy shift to combat corruption,” Castelo said. “In contrast, the government loses at least 20 percent of the national budget to corruption.”

Because of its limited budget, the Office of the Ombudsman could hardly build up cases and prosecute them, as shown by its batting average of winning only 7% or less of all lawsuits it has filed in court is hardly satisfying, Castelo said.

The Office of the Ombudsman has hardly run after any other big fish, making corruption a “high yield, but low risk” activity in the country, Castelo said.
“Hence, corruption has become endemic, taking roots in the nation’s social, economic, and political fabric, Castelo said, adding that opinion polls showed that most Filipinos have learned to accept corruption as a way of life.
Castelo also called for a vigorous, sustained, and continuous lifestyle check of public officials, adding that this is easier to pursue because a glaring difference between his lifestyle and his reported statement of assets and liabilities would be enough to establish prima facie evidence of corruption.

The proposed anticorruption agenda calls for enactment of the Whistlebowers’ Protection Law, which elevates to state policy the provision of ample protection to people, who would spill the beans on public officials, who have committed – or about to commit – corrupt activities. Embedded in government, whistleblowers possess knowledge about corrupt acts; they are in the best position to expose and make them public, Castelo said. “Hence, a whistleblowing policy becomes necessary for the detection and prosecution even of well-hidden anomalous transactions.”
Castelo said that a major reason for the government inability to prosecute corrupt public officials is the continuing failure to protect whistleblowers, who feel that the government would leave them alone when the situation becomes tough. Castelo’s anticorruption agenda includes the fourth point, which requires the multisectoral involvement – from the nongovernment and people’s organizations that compose civil society, the business community, the Church, the academe, and even from ordinary citizens.

“The imperative is for the private sector to take the lead,” Castelo said, even as he pointed to the fifth point, which is the development of the anticorruption culture, or the counter-consciousness that stresses the negative effects of corruption. “The anticorruption agenda should propagate the awareness that corruption is not normal in a developing nation like ours. It has to develop the counterculture that justifies and rewards whistleblowing,” Castelo said.

Also, the fifth point should strive to the creation of an anticorruption army of private citizens, who would readily report and run after corrupt public officials and even private parties, who corrupt public officials.

Rep. Winston “Winnie” Castelo (Liberal Party, 2nd District, Quezon City) today rejected the proposed imposition of taxes on text messages that flow through the nation’s telecommunications networks, saying it was the wrong solution to the woeful national health situation.

“Taxing the text messages is the wrong solution; it’s taxing the poor to be given to the poor. Effective taxation is transferring resources from the richer segment of the population to the poor,” Castelo said in a statement.

Castelo made the statement to debunk the World Health Organization official’s suggestion to tax non-traditional sources mainly to raise funds for the Aquino administration’s Health for All program.

While he agreed to the WHO official’s proposal to tap nontraditional tax sources to provide universal healthcare services for the population of over 100 million, Castelo said the realignment of the current budget is the better option at the moment to fund the centerpiece health program.

Castelo vowed he would block any measure that imposes tax for text messages.

The Health for All Program mandates that all Filipinos, especially the poor, will have access to healthcare services to promote social equity and lessen the out-of-pocket payments for their health bills.

Actuarial estimates showed that the Health for All program will require an annual cost of between P73 billion to P85 billion for the 100.2 million Filipinos, or 21 million households nationwide.

The poorest quintile, which cover at least 5.2 million households and who are regarded the “poorest of the poor,” has the most number of health issues, although they represent the population segment on which the program will have a tremendous impact.

Since the state-owned Philippine Health Insurance Corporation (PhilHealth) will be the fulcrum of the Health for All program, Castelo suggested a sustained membership campaign to complete its mandate of 100 percent coverage for all Filipinos in the next two or three years.

The national government and the local government units (LGUs) should be mobilized to support Philhealth’s membership campaign and pay for the indigent members, who do not have the financial capability to remit their monthly premium contributions to PhilHealth, Castelo said.

For its funding requirements, Castelo said the administration could tap other sources like the Philippine Amusement and Gaming Corporation’s Presidential Social Fund from which it could generate around P10 billion every year and the Department of Social Welfare and Development’s conditional cash transfer of P40 billion, which Congress has allocated for 2012.

If PhilHealth could raise its annual premium collection to at least P40 billion from members from its current level of less than P30 billion, Castelo argued that it could further strengthen its asset base to over P110 billion, assuring the success of the Health for All program.

Aside from Pagcor and the CCT, Castelo said the Health for All program could generate annual subsidy of between P6 billion to P10 billion from the Philippine Charity Sweepstakes Office (PCSO).

The joint PCSO-Pagcor subsidy of P20 billion, the remittance of over P10 billion in premium payment backlogs from the NG and the LGUs, and the realignment of a significant portion of the P40 billion CCT fund to health services would be sufficient for the Health for All program, Castelo said.

Castelo said the administration could also tap other nontraditional sources like the so-called “sin products” composed of alcoholic beverages, liquor, and tobacco products, but said the administration has to assure it could sufficiently collect from the traditional sources before tapping the nontraditional sources.

Rep. Winston “Winnie” Castelo today urged the Filipino people to stop berating boxing champion and lawmaker Manny Pacquiao for his close win over Mexican prizefighter Juan Manuel Marquez and demonstrate national unity by supporting and standing behind him.

“It’s not right and proper that we will be the first to berate Manny Pacquiao. It is not right that we are sunshine compatriots, who only rejoice when Manny wins clearly on the ring,” Castelo said.

“We should always be at Manny’s side – win or lose. This is the time-honored value of walang iwanan. We should never leave him because of one close fight,” Castelo said.

“National unity becomes more meaningful, when we don’t leave a hero and friend even in times of adversity,” Castelo said.

Castelo also urged the people to give the benefit of doubt to the three American judges, saying “they had the best angle of the fight.”

“What we had is the television angle, which was not necessarily accurate to determine the outcome of the fight,” Castelo said.

“Manny Pacquiao is the best thing that has happened to international boxing in over a decade. Manny Pacquiao did everything humanly possible over the ring,” Castelo said. “Let’s not take the credit away from him.”

According to Castelo, the people were so used to Pacquiao’s lopsided victory to the point that they could hardly accept a close fight.

It is almost a done deal, but controversy hounds the merger of the dominant Philippine Long Distance Telephone Company (PLDT) and smaller rival Digital Telecommunications Philippines Inc. (Digitel). Despite the approval by the regulatory National Telecommunications Commission (NTC) of the biggest corporate deal in the nation’s economic history, certain questions beg for answers.

From the P72 billion PLDT-Digitel share swap deal, a bigger PLDT emerges as the surviving entity to control at least 70 percent of the nation’s information and communications (ICT) sector. As their owners and executives gloat over the PLDT-Digitel merger, these questions arise: Will the merger lead to cheaper, improved, and efficient telecommunications services for the Filipino people? Will it redound to a more vibrant, dynamic, and competitive telecommunications sector? Or will it mean the re-emergence of the PLDT monopoly?

Legal complications

Strangely, the NTC flashed the green light despite the reported deliberations by the Supreme Court on the motions for reconsideration, which several parties, including PLDT, have filed against an earlier SC decision, which defines PLDT as a foreign firm that mocks the constitutional cap on foreign equity in public utility firms.

In the case filed by the late lawmaker Wilson Gamboa, the Supreme Court said in its ruling that only the common shareholding, not a combination of common and preferred shareholdings which the PLDT has been insisting, is the basis for computing the foreign equity in a public utility firm like the PLDT.

In the Gamboa v. Teves (GR No. 176579, June 28, 2011), the SC majority opinion penned by Associate Justice Antonio Carpio said PLDT has been violating the constitutional cap on foreign equity as foreign entities own more than 60 percent of the common shareholdings of PLDT. Citing the 1987 Constitution, the SC said that foreigners can own up to only 40 percent of common shareholdings, as the Constitution seeks the “effective control” by the Filipinos of the national economy.

The NTC should have waited for the Supreme Court to rule on the motions for reconsideration filed by PLDT and other parties. But with the NTC approval, the PLDT-Digitel faces legal complications, as legal challenges are to appear the moment the high tribunal dismisses those MRs. It is not clear how the two telcos would face the legal impediments.

‘Conditional approval’

The NTC has approved the PLDT-Digitel merger subject to three conditions: permanence for the unlimited calls and texts under the Sun Cellular brand; divestment and sale of the 10 Mhz 3G radio spectrum of PLDT’s Connectivity Unlimited Resource Enterprises to another wireless party except PLDT; and reduction of interconnection rates to assure PLDT’s interconnection with other carriers, big and small.

Although the NTC appears bent to pursue the three conditions, they are fundamentally insufficient to promote a dynamic, competitive, vibrant, and efficient telecommunications sector. They do not necessarily mean they could bring up the sector to the next level.

The wireless subsector has developed over the past two decades to mature considerably. This maturity means cheaper and better services, which are sustainable for a prolonged period. Hence, a regime of expensive wireless call and text messaging services is now a thing of the past. It is unthinkable – or impossible – with or without the PLDT-Digitel merger.

The emergence of a third wireless player in Digitel in 2003 proves that a regime of cheaper text messaging and call services is possible to provide the people with greater and more flexible access to telecommunications services. A three-party wireless subsector has proven to be more vibrant and competitive than a two-player wireless subsector.

Also, the interconnection template has been ironed out three years ago. Players – big and small – are required to interconnect their subscribers, resulting in cheaper services. Players could not escape interconnection because it is the heart of providing universal access to telecommunications services. Without interconnection, all players and subscribers suffer.

Also, the bigger PLDT cannot possess its current radio frequencies without giving up something in exchange for a future advantage, which is its emerging financial heft to ease out competitors. CURE, a PLDT subsidiary, has limited subscribers, which the bigger PLDT could sacrifice for an advantage. Giving up its radio frequency is no big deal.

Hence, the NTC is unwittingly helping the bigger PLDT to dominate further the telecommunications sector. To say that the conditions are being imposed to protect end-users and make the market more efficient, vibrant, and competitive is nonsense.

Missed opportunity

The NTC had the technical capability, financial know-how, and luxury of time to go over the PLDT-Digitel merger and impose additional conditions, but it neither had political will nor vision to do it.

Take Internet connectivity. Rapid global developments have pushed most nations to hook their citizens to the international information superhighway to hasten economic growth and development. But local Internet penetration is low, putting the Philippines in the dark ages in Internet connectivity.

The NTC should have asked the bigger PLDT to lower the high cost of Internet connectivity to enable more Filipinos to gain access to the worldwide information and communications network. The costly Internet connectivity has been the bane to accessing the global information superhighway.

Because of the PLDT-Digitel merger, the bigger PLDT will control six of the seven international submarine cables and four of the five cable landing stations, putting most Internet facilities under its control. As Internet-friendly gadgets become available to end-users, Internet connectivity cost should go down.

The NTC should have addressed the Internet connectivity cost if it wants to raise Internet penetration, which is below 10 percent for the country’s population of 100.2 million. This is a missed opportunity for the regulator.

Failure of policy

In 1995, Congress has had enacted Republic Act No. 7925, or the Public Telecommunications Policy Act, to deregulate the telecommunications sector and dismantle the PLDT monopoly. The policy shift had created a liberalized atmosphere, enticing new entrants. But it did not necessarily lead to a more competitive environment, as the new players later sold out their stakes and exited from the ICT sector.

The duopoly of PLDT and Globe Telecom has supplanted the then lethargic and counterproductive PLDT monopoly of the pre-1995 era. But the duopoly is being seen as the perpetrators of cross subsidy and predatory pricing to ease out any third player or discourage new entrants.

While Digitel’s entry into the market had provided competitive challenge to the duopoly of PLDT and Globe Telecom, the consequent decline in the prices of telecommunications services among the three players reflected predatory pricing that led to Digitel’s financial difficulties. Digitel had no choice but to join and merge with the nation’s biggest telecommunications firm.

In short, the PLDT-Digitel merger is indicative of a policy failure. While RA 7925 has rid the nation of a monopoly, it has failed to stop the duopoly from emerging, triggering market distortions, which include predatory pricing practices and cross subsidy that led to cheaper text messaging and call services, but expensive and erratic Internet connectivity.

RA 7925 has been inherently infirmed to meet and sustain the challenges of a multiplayer telecommunications environment, while the NTC lacks the political will to tackle a liberalized market.

Policy options

Statesmanship requires new policies to rein in the duopoly of the emerging bigger PLDT and Globe Telecom. The two policy options are the passage by Congress of an antitrust law or the imposition by the NTC of obligations on telecommunications firms that enjoy significant market power.

These policy choices find expression in Section 19, Article XII of the 1987 Constitution, which says: “The State shall regulate or prohibit monopolies when the public interest so requires. No combinations in restraint of trade or unfair competition shall be allowed.”

No less than President Benigno Aquino III, in his 2010 inaugural address, has unveiled the urgency of an antitrust law, saying it as one of the priority legislations. The proposed antitrust law seeks to slow down expansion of conglomerates, or dismantle monopolies and oligopolies to stop market distortions.

The planned policy mix provides additional obligations on the bigger PLDT and Globe Telecom, which will have a combined market share of 99 percent of the wireless subsector, 96 percent of the fixed line subsector, and 95 percent of the data services, or Internet subsector. These obligations are telecommunications services at “just and reasonable prices, terms and conditions” on a “nondiscriminatory basis” and upon “reasonable request.”

Asymmetric regulation

The imposition of obligations on carriers with significant market power stems from the asymmetric – or skewed and uneven – distribution of market power in the domestic telecommunications sector. The largest two carriers, or the duopoly of the bigger PLDT and Globe Telecom, among the 70 or so local exchange operators account for 90 percent of the subscriber base and more than 95 percent of the wireless, fixed line, and data subsectors.

Ergo, asymmetric regulation is the logical regulatory response to the asymmetric market situation. Those carriers that control the market would have to follow a different set of rules in what appear to be like a handicapping system in horseracing.

In an earlier paper, the NTC had explained that large carriers, which own and control costly infrastructure, could eliminate competition by denying rival carriers access to their facilities, which the smaller rivals need to provide services.

The same principle applies to incumbents, which, by being the first in the market, enjoy the advantages not only of control of essential facilities and network standards but also of customer inertia since many customers would avoid the cost of switching service providers.

Moreover, an incumbent carrier with vertically integrated facilities can cross subsidize its services and engage in predatory practices in market segments threatened by competition.

Predatory practices

The data subsector showed predatory pricing practices, when the PLDT-Globe Telecom duopoly competed with and eliminated later those independent Internet service providers (ISPs). These ISPs had to pay interconnection fees, losing to dominant carriers, which provide the same Internet services at a lower cost.

This is one of the reasons for the costly Internet connectivity, which is a major barrier for improved Internet penetration in the country.

Incumbents’ response

For the past three or four years, the duopoly of PLDT and Globe Telecom has been opposing the imposition of additional obligations for carriers possessing significant market power. In fairness, they have legitimate reasons to oppose these policy initiatives, believing they could lessen their tight grip on the telecommunications sector.

For instance, Globe Telecom argued that the NTC could not impose them without undergoing a judicial challenge. Globe Telecom claimed that the competition policy is constitutionally infirmed, as it violates the equal protection of the law doctrine.

PLDT opposed the competition policy on the ground that “holding substantial market power does not equate to holding or exercising market power.” On the contrary, PLDT argued that “bigness is not a crime” and the current competition has been “robust” and “effective,” as shown by indicators such as price declines and service innovations.

PLDT argued that international aircraft manufacturing has been dominated by Boeing and Airbus, but their competition has been intense and robust, leading to the production of airworthy aircrafts. PLDT chair Manuel Pangilinan argued that the Philippines should be like Hong Kong, which has two telecommunications players that compete vigorously.

These two arguments are fallacious. The aircraft manufacturing sector has the entire world as its market. The Philippines with its population of 100.2 million by end-2010 could not be compared with Hong Kong, which has a population of 5.3 million.

Because of the two telcos’ opposition, the NTC had shelved further discussions on the adoption of any competition policy or imposition of obligations on carriers enjoying significant market power. This is a policy option that has been relegated to oblivion since 2007.

Weak NTC

Had the NTC allowed the additional obligations some three or four years ago, the telecommunications sector would not be rattled by the PLDT-Digitel merger. As the main telecommunications policymaker outside Congress, the NTC could have redefined the market and make it transparent and competitive.

But the NTC is weak to handle the policy regulatory issues that have fallen on its lap. It is a victim of “industrial capture,” as it could not respond adequately to the issues and challenges posed by the duopoly.

Congress has to craft a law to strengthen the NTC. Hence, the NTC has to be empowered to conduct inquiries, hearings, and investigations and decide on the basis of information secured through public hearings, official notices, and solicitations for data. The NTC commissioners should have a fixed tenure of office. Its staff has to be retrained.

Policy revival

The bigger PLDT would hardly lead to a monopolistic situation. The scenario is a stronger PLDT-Globe Telecom duopoly taking a deeper root – and, ergo, a stronger hold – in the telecommunications sector. They have to enter into a modus vivendi for their mutual advantage. All talks of a telecommunications “war” between the two telcos are just talks.

The policy revival to impose obligations to the two firms enjoying significant market power is the right policy. The question is whether to strengthen first the NTC through a new legislation, or impose those obligations even under an effete NTC. Also, the obligations have to be identified too. This is a policy issue that has been to be answered by no less then the President himself.

Or shall Congress proceed to enact the pending bill on competition policy? Or shall it enact the pending antitrust bill, which the Legislative-Executive Development Advisory Council (LEDAC) has shelved to give way to the other pending bills?

Other policies

The market does not have to wait on how the PLDT-Globe Telecom duopoly will behave. As a rule, monopolies, oligopolies, and cartels kill competition and create market distortions at the expense of end-users. Hence, the duopoly is not something to be trusted.

Some policies have to be enacted to deter market abuses by the duopoly. Vigilance has to be exercised.

Other policy recommendations:

1.     Mandatory policy to push big telcos to serve unprofitable and hard to reach rural areas. Congress can pass a law requiring the identification of these areas and mandating the nearest telco’s point of presence to hook these areas into their broad backbone through state agency Telecommunications Office.

2.     Full adoption of the Voice over Internet Protocol (VOIP) technology as an alternative for overseas calls primarily to lessen the digital divide and initiate an era of cheaper overseas calls; and

3.     Inventory of all radio frequencies and their rationalization so that smaller telcos would radio frequencies to serve rural areas.

Conclusion

The twin issues of PLDT-Digitel merger and stronger PLDT-Globe Telecom duopoly has to be addressed before it becomes too powerful to reach the point of no return. Corporate power bequeaths political power. Hence, appropriate policy changes have to be pursued to assure universal access to telecommunications services.

Congress has to enact an antitrust law and an overall competition policy. The Supreme Court has to rule on the foreign equity issue of the PLDT. The NTC has to be strengthened as a regulatory agency. Unless those policy initiatives are pursued, the duopoly will redefine the telecommunications sector at will with the end-users at their mercy.

About the author: Rep. Winston “Winnie” Castelo is a neophyte lawmaker representing the second district of Quezon City in the House of Representatives. He belongs to the Liberal Party. He was a member of the Sangguniang Panglunsod for four terms before his election to Congress. He is an AB Philosophy graduate of the University of the Philippines.

Reducing official corruption to zero by 2015 is quixotic, but not impossible. Since the elimination of official corruption, or a “corruption-free Philippines,” is the centerpiece program of the Aquino administration, it has to pursue it with intensity and without letup.

An anticorruption agenda is nonsense sense if it reduces corruption by half. Either the Aquino government eradicates it completely or it fails. The elimination of official corruption is even sustainable in the medium and long term.

Political will

An anticorruption agenda starts from the top. It is predicated on the President’s strong political will. He should be sincere, clear-minded, and determined to banish corruption. The clarity of thought, purity of intention, and singleness of purpose should be beyond any shadow of doubt.

A half-hearted attitude towards corruption is doomed. The nation has learned its lesson from the past administration, which never took any serious anticorruption campaign. Its anticorruption initiatives were dubious, insincere, and outrageous – or bound to fail. Hence, the backlash is evident.

High risk

The overall goal of a real anticorruption agenda is to make corruption a high risk crime. Any corrupt official, his cohorts, and accomplices, whether in government or private sector, will have to pay a heavy price when caught and brought to the bar of justice. That crime pays is the basic rule.

This is the reversal of the prevailing notion that corruption has remained a low-risk, high-yield state activity. So long as the corrupt official steals big, he goes unscathed and unreachable by law.

Instead of the corrupt and his ilk risking everything, it is the other way around. The detection and successful prosecution of its perpetrators becomes risky for somebody, who report corrupt practices.

Its reversal requires initiatives, ranging from policymaking to the development of a mass culture that rejects corruption as a way of life. The road to a zero corruption society is challenging and tedious, but reachable.

Abuse of power

Corruption is the abuse of state power for private gain. It happens when a state official or employee uses his power or office to solicit bribes or favor. This is one side of corruption; the other side involves private persons, who bribe state functionaries or influence policymaking to gain an undue competitive advantage or secure a profitable government contract.

Bigtime corruption blatantly shows the nation as a soft state. It indicates its weak political will and structure to handle corrupt activity. It weakens investments and hinders economic growth and development. It leads to political and regulatory uncertainties that bar investors from the pursuit of business plans, whether for expansion or new ventures.

Studies showed that corruption has been happening due to wide authority, little accountability, and perverse culture of state officials and employees. It is lucrative, when public officials have enormous discretion to control or regulate. It proliferates when the environment has “little accountability,” or when the detection and punishment of corrupt practices is low or almost nonexistent.

Low salaries

Studies also showed that other factors favoring corruption are low salaries and rewards for performance, lack of professionalism in public service, and perverse incentive system. Corruption thrives, when the environment lacks people who challenge or stop any corrupt activity.

Also, corruption perpetuates in a culture that has high tolerance of wrongdoing. It is disturbing, when a critical mass of people considers as standard operating practice the failure to report attempts by state officials to solicit bribes. It spreads when people tolerate questionable practices and do not report them.

Adverse effects

Studies showed the country loses at least 20 percent of its national budget to corruption. It could go higher because of the culture that makes corruption a low-risk, high-yield bureaucratic activity in the country.

An anticorruption agenda is an act of self-defense of the state. It stems from the recognition that a state has the inherent right to defend itself from acts that undermine its existence and stability.

Anti-corruption agenda

The anticorruption agenda for the next three or four years includes the following:

·       increase in the budget of the Office of the Ombudsman to at least one percent of the annual national budget;

·       sustained lifestyle check of public officials;

·       enactment of a law protecting whistleblowers;

·       empowerment of the private sector to go after corrupt public officials,

·       development of a mass culture that rejects corruption as a way of life, and

·       creation of an “anti-corruption army,” which represents a critical mass of ordinary citizens, who would run after corrupt public officials.

Effective deterrent

The resignation of Merceditas Gutierrez and the appointment of retired Supreme Court Justice Conchita Carpio-Morales do not necessarily make the Office of Ombudsman an effective deterrent to the commission of graft and other corrupt acts. But they constitute the start of a sustained anticorruption drive.

Although the Office of the Ombudsman, the constitutional body tasked to reduce corruption, uses punitive and retributive means to fight corruption, it suffers from institutional constraints that weaken its anti-corruption strategy. Its budget slows down imposition of administrative sanctions, investigation and prosecution of graft cases, and public assistance.

Graft watch

It could not conduct intensive graft watch over the bureaucracy, engage in value formation among public servants, coordinate with other state agencies, and improve systems and procedures.

The anticorruption agenda means raising the annual budget of the Office of the Ombudsman to one percent of the national budget from the present 0.7 percent. By raising its budget, the Ombudsman can initiate substantial changes, which include the hiring of new lawyers to replace the corrupt prosecutors, who keep on filing cases that are destined to lose, and improve its dismal record of winning only seven percent of all lawsuits in court.

The new Ombudsman can look into the proposed transformation of the Office of the Ombudsman into a body similar to the Independent Commission Against Corruption (ICAC), which is pivotal in Hong Kong’s ong Kong’sHongtransformation from the most corrupt to the second least corrupt territory in Asia. This is now new; the past president had mentioned it. But her insincerity stifled its pursuit.

Lifestyle checks

The pursuit and intensification of the lifestyle check program among government officials and workers can provide the simplest way to identify the corrupt in the bureaucracy. By proving that the lifestyle and accumulated wealth of a particular official does not commensurate to his statement of assets, liabilities, and net worth (SALN), this program can effectively deter the commission of corrupt activity, especially the high level ones.

Hong Kong rose to become one of the least corrupt societies in Asian, when its ICAC conducted lifestyle checks on its officials. This is worth looking and emulating. The Office of the Ombudsman, the Department of Finance, and various agencies have their respective programs to conduct lifestyle checks, but their initiatives will have to be coordinated and sustained to investigate officials, whose lifestyle does not correspond to their legitimate income.

Whistleblower’s protection

The passage of a whistleblower’s protection law to encourage the exposure of corruption is part of the anticorruption strategy. As insiders, whistleblowers possess intimate and detailed knowledge about corrupt activities.

By encouraging them to reveal and report corrupt practices, a whistleblowing policy or program may facilitate the detection and prosecution of well-hidden anomalous transactions. By exposing corrupt practices and its perpetrators, whistleblowing becomes as an antidote to the abuses of power for private gain.

But whistleblowers are unwilling to blow the whistle against corruption. Either the personal costs of corruption are light to prompt individual protests against it or people would not see clear personal benefit from whistleblowing.

Also, without protection, whistleblowers would only shoulder the heavy personal costs from an act that would primarily benefit society, but yield only remote personal benefit for them, if any.

Without a legal framework, people will avoid it. Hence, Congress would have to enact a whistleblowers’ protection law to uncover and prevent anomalies.

Ricky activity

Few people report wrongdoing in public service because of risks: ruined careers, ostracism, and harassment by superiors and co-workers. Whistleblowers need assurance about legal support, remedies against retaliatory actions, and financial incentives for reporting corruption.

The enactment of a whistleblowers’ protection law can protect whistleblowers from reprisals and harassment, neutralize the social stigma of whistleblowing, lessen social ostracism, secure the informant and his family, and provide legal immunity, when they make public disclosures.

Hence, the proposed law will go a long way to encourage the “silent majority” of public officials and employees to report wrongdoings. It will mean accountability and transparency in public service. It promotes a culture that rejects corruption as a way of life.

Private sector empowerment

The participation of the private sector, which includes the business community, civil society, the Church, the labor sector, and the youth and the academe, is important. Without the participation and cooperation of the private sector, the anticorruption agenda will suffer from institutional constraints.

The Church, civil society organizations, and trade unions are effective deterrents against official corruption. They can function as whistleblowers, or they can provide ample protection, wherewithal, assistance, or legal help to potential whistleblowers, easing the latter’s difficulties.

Code of conduct

Private firms can impose their respective codes of conduct, putting in place the overall framework for the ethical behavior of their directors, corporate officers, and employees. Hence, ethical minded employees take a positive view and practice of whistleblowing. Written internal policies on whistleblowing can complement the code of conduct.

The organization of disciplinary action committees among private firms and the institution of certification requirements towards social accountability are equally important steps to strengthen the anticorruption agenda.

Social accountability and transparency is a fundamental value that has to be propagated and enforced among the myriad of private firms and civil society organizations in the country. It deters corruption.

Labor unions can provide support for whistleblowers by helping them access to

management’s attention and giving them moral and financial support.  Support institutions, like religious groups, the academe, business groups, and other groups from the civil society, can support advocacy work or legal assistance.

Mass culture

The anticorruption agenda will not succeed without the participation of the citizenry, or the simple people, who toil day and night to make the country a better place to live. Hence, value formation, or the development of a mass culture, that rejects corruption as a way of life, will have to be developed, propagated, and instilled into the mind of ordinary citizens.

The state propaganda machinery will have to be harnessed to teach ordinary citizens and inculcate into their collective consciousness that crime pays and corruption will never go undiscovered.

The private mass media, whether traditional or nontraditional, will have to stress the positive value of honesty, transparency, and accountability in public service and private citizens, who corrupt public officials and workers, will suffer the consequences of their acts.

Citizens’ army

The mobilization of ordinary citizens for the anticorruption campaign will go incomplete without the creation of a citizens’ army, whose agenda is to solidify the citizens’ participation in the campaign against corruption, big or small.

Under the leadership of key stakeholders like the Church, civil society, labor, and academe, the citizens’ army will have to mobilize the youth, the leaders of whom will inherit the mantle of the nation’s leadership in a decade or two.

The citizens’ army will take the vanguard role to pursue value formation. On the positive side, the citizens’ army will go to the people to stress the importance of clean government and effective governance and the value to provide honest and dedicated public service.

On the negative side, the citizens’ army will expose publicly those corrupt public servants, whether he is an ordinary cop, who mulcts errant motorists in the streets, a “hoodlum in robe,” who sells decisions to litigants, or a top official, who accept bribes from contractors in key state projects.

It shall not hesitate to shame them publicly. In short, when the court of justice grinds slowly, the citizens’ army can go to the court of public opinion to exact justice for the wrongdoings of those state officials and their cohorts.

Dead end

There is no dead end in the quest for the twin objectives of clean government and effective governance. While the road is fraught with many dangers, a zero corruption society, or corruption free Philippines, is achievable in the medium or long term. What the nation needs is a strong political will of its leaders and the willingness of its citizens to create a society worth living.

About the author: Rep. Winston “Winnie” Castelo represents the second district of Quezon City. An AB Philosophy graduate of the University of the Philippines Diliman, the neophyte lawmaker was a member of its Sangguniang Panglunsod for four terms. He belongs to the majority Liberal Party.