Privatize Pagcor!

It may be bad news for some bishops and some fellow workers in media. But I am all for the call of the Philippine Stock Exchange (PSE) to privatize the Philippine Amusement and Gaming Corp. (Pagcor) through a combined sale to an interested investor and an initial public offering (IPO). Not only would this remove a source of temptation for the usual suspects, it would also boost liquidity in the local stock market with the addition of another interesting issue.

The timing for Pagcor’s privatization is perfect. Its charter is expiring and Congress is currently conducting hearings on a new Pagcor charter. PSE president and chief executive officer Francis Lim was one of those who recently testified and he explained that proper privatization would raise P80 billion for the national coffers which would substantially help the government in its revenue-raising programs to address the fiscal deficit.

Though the mere mention of the name Pagcor may connote notoriety, it is a good contributor to the government treasury, after the BIR and Customs. But even its seemingly eye popping money spinning record is supposedly understated... its expenses include pork given to politicians and it could earn more if it had a better international marketing presence that the Las Vegas casino chains have.

Quezon Rep. Danny Suarez once told me that a privately run casino business, with Pagcor being converted into the regulatory agency on top of it, should contribute a lot more to the National Treasury. An international casino operator would also give the privatized Pagcor the benefit of a worldwide marketing effort.

A Pagcor IPO, the PSE head thinks, will also encourage other profitable government-owned and controlled corporations, including the Philippine Charity Sweepstakes Office, Development Bank of the Philippines and Home Development Mutual Fund, to follow suit. A publicly held Pagcor would also hopefully vastly improve transparency in its transactions and good governance, given the rigid listing and reportorial requirements imposed by both the Securities and Exchange Commission (SEC) and the PSE to publicly listed companies.

Under Lim’s proposal, the National Government’s residual ownership of 40 percent in Pagcor will provide it with continuing revenues via cash dividends. A Pagcor IPO will likewise disperse the corporation’s ownership to the investing public pursuant to its constitutional mandate. But I guess, Ate Glue will lose her source of "pork", otherwise known as the President’s Social Fund.

I also hear there is intense lobbying by current Pagcor officials in Congress get a new Charter to stop privatization. And we all know when Pagcor is involved and it needs something valuable from politicians, what happens next. These may well be pretty happy days in Congress.

This is why we should privatize. It is however important that should we take the privatization route, the privatization process must be open and transparent to withstand public scrutiny. The selection of the principal private sector investor would be subject to a lot of public speculation unless the process is done in an extremely transparent process with an internationally credible financial adviser in control.

Pagcor’s income has been growing at an annual average rate of 16 percent since 1986. It has figured as one of the top two corporations, as listed by the SEC, since 1995. About five percent of Pagcor’s net winnings are remitted to the BIR. The agency also allots a significant chunk of its earnings to the President’s Social Fund.

All of Pagcor’s earnings, net of operating expenses, now estimated at 50 percent of its gross revenues, go to the National Treasury. I guess the question can be raised on the legitimacy of some of those items they include under operating expenses. Where else would they hide what is used, if Ate Glue was quoted correctly, to take care of media and bishops... and pork seeking politicians too.

Yorac, Roco, Jarque

We lost another good one with the death of Haydee Yorac. How come we are losing the very people we need to lead this nation out of our current woes? We lost Raul Roco, the best president we never had. Then the young Army Captain Rene Jarque, who retired from the Armed Forces very early out of sheer frustration, died prematurely as well. Now, we lost Haydee.

It is true what they say about the good dying young. Maybe our Lord, in His infinite wisdom, wants us to get inspiration from these modern day heroes to lift ourselves out of our mess by ourselves. All I know is that there has to be a good reason, one that our finite human minds can’t see, to lose these credible leaders and be stuck with the ones we still have in our midst.

But it sure takes a lot of faith at times like this to see good people leaving us while those who have done this nation grievous wrong, and still continue to do so, are so alive and well. That’s life, I guess.

Car Plates

DOTC Assistant Secretary Anneli Lontoc, who heads the Land Transportation Office (LTO) wrote to respond to complaints about delayed release of car plates for new car purchases. Such delays are penalizing new car owners who cannot use their new cars out of fear of being apprehended in the No Plate No Travel campaign of DILG Secretary Angie Reyes. Ms. Lontoc says there is no reason for delays because "we have thousands of plates in our offices."

A reader complained to us that his dealer told him he could get "early release" of his plates if he paid P2,500, no receipts, of course. Asec Lontoc wrote that "the problem really lies with the dealer, for not submitting complete documentation of the vehicle. But because, they need to appear good to their customers, they always say that LTO is the problem."

I suspect that the fixers working with the dealers are making a brisk business in the so-called "early release" of car plates when all along, the plates could be released immediately for so long as the documentation is complete. Asec Lontoc assured me they have streamlined the process of registration. "We have addressed the lack of plates."

"Perhaps," Ms. Lontoc wrote, "I can reach some of our motorists and vehicle buyers through your column...Should there be a problem of delayed issuance of plates, please let us know, by faxing to us, whatever documents you may have in your possession at fax no. 9219071 and/or calling us at 9219072."

Or e-mail her at [email protected]. She responds to e-mails.

Fertilizer

Dr. Ernie E. sent this one for today’s smile maker.

One morning a husband took a pair of underwear out of the drawer.

"What bloody hell?" he muttered to himself as a little "dust" cloud appeared when he shook them out. He hollered into the bathroom, "Why did you put talcum powder in my underwear?"

His wife shot back: "It’s not talcum powder. It’s ‘Miracle Gro’."

Boo Chanco’s e-mail address is [email protected]