PNCC urged to remit annual shares from NLEX, SLEX revenues

MANILA, Philippines - The Philippine National Construction Corp. (PNCC) should remit its share of the revenues of the North and South Luzon Expressways to the national government because its franchise had already expired three years ago.

This was raised by Senate committee on finance chairman Franklin Drilon and Senators Ralph Recto and Sergio Osmeña III after it was revealed that PNCC continues to receive six percent of toll collections from NLEX and 1.75 percent from SLEX despite the expiration of its franchise in April 2007. The collections represent franchise or royalty fees.

PNCC president Ma. Theresa Defensor disclosed that the six percent from NLEX translates to around P300 million to P400 million a year while the 1.75 percent from the SLEX is estimated at P60 million. Defensor argued that these amounts were not franchise fees but were part of commercial agreements between the PNCC and the private operators of the two expressways.

“Our position is that the PNCC, since it no longer has a franchise, has no business appropriating for itself the six percent which is part of the toll collection in the NLEX,” Drilon said.

“Since that franchise has expired, the six percent already pertains to the national government and PNCC has no business appropriating it for themselves,” he added. This means that the PNCC owes the national government around P900 million to P1.2 billion for the period 2007 to 2010 for the NLEX and another P180 million from the SLEX, according to the senators.

During yesterday’s hearing on the proposed 2011 budget of the Toll Regulatory Board and the PNCC, Defensor noted that the total outstanding obligations of the PNCC now stands at over P6 billion.

She said much of the amount was inherited from the previous administrations including the obligations to the Asset Privatization Trust, Marubeni Corp. and P3.34 billion to the national treasury.

Defensor said that the PNCC has submitted a 25-year restructuring plan to the Department of Finance but this has not yet been approved.

During the hearing, the senators also questioned the creation of a new position in the board of the PNCC, chairman emeritus. The position was not in the bylaws of the PNCC and was created only last February upon the request of then President Gloria Macapagal-Arroyo. 

According to Defensor, the appointed chairman emeritus Josefa Aquino is entitled to per diems and monthly allowances just like the chairman of the board.

Prior to the order of Malacañang recently to suspend these allowances, Defensor said that Aquino was probably receiving around P300,000 a month.

Upon the prodding of the senators, the corporate secretary of PNCC admitted that the creation of a new position could only be done through an amendment of the bylaws of the corporation, which must be approved by the stockholders.

This was not done by the PNCC.

“The chairman emeritus is illegal. It’s not provided in the bylaws. Only officers that are provided in the bylaws can be elected,” Drilon said.

He said that it was PNCC chairman Arthur Aguilar who influenced the board to agree to the instructions of the former president. “These are illegal acts. How can you just make a position without amending the bylaws? And the bylaws can only be amended by stockholders’ action,” he said.