PNP out of cash / Muzzling Bayani

Thousands of policemen who took out loans from the Armed Forces and Police Savings and Loan Association are in a quandary. The PNP has not remitted to AFPSLAI an entire month’s loan payments that it deducted from their salaries. And they’re being punished for it.

The policemen found out about it when some of them tried to borrow again from AFPSLAI. They were told that AFPSLAI has written the PNP thrice to remit the deductions for December 2002, but was ignored. To be able to take out new loans, the policemen must pay the December installments again because of the PNP’s lapse.

The unremitted deductions run to the millions of pesos. PNP Dir. Gen. Hermogenes Ebdane and his finance officers have yet to explain to the men what happened to their money.

Policemen can borrow from P15,000 to P150,000 at a time from the AFPSLAI, depending on their salary scale, payable in 24 months at nine percent interest. Many avail of it for home repairs, small business startups, or emergencies. The PNP deducts P650 to P6,500 from their monthly pay, and must remit the amount to AFPSLAI within two weeks.

For yet unknown reasons, the PNP did not turn over the entire December deductions. Policemen who borrowed again from February to April 2003 had to suffer the consequences. AFPSLAI granted the new loans, but deducted the unremitted amount, plus penalty interest of 17.13 percent, from the principal.

Policemen used to have their own PNPSLAI, set up by some retired generals. When the fund fell into dire straits, higher-ups merged it with the decades-old AFPSLAI. Now it seems that PNP generals in Camp Crame have messed up the AFPSLAI in Camp Aguinaldo as well.

Word is that the Army, too, did not remit an entire month’s loan payment deductions from soldier-borrowers. That’s why muttered curses are heard from policemen and soldiers at the AFPSLAI teller windows.

And we expect them to give up their lives to defend us from crime?

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Murmurs at the Metropolitan Waterworks and Sewerage System are that Bayani Fernando was forced out of the public works department by a strong lobby from Maynilad Water Services. As MWSS ex-officio chairman because of the department post, Fernando was incensed to find out that Maynilad was exacting unauthorized charges from millions of customers, and advised consumer groups to sue for estafa. Fernando also wanted the MWSS to take over the Maynilad west zone concession while arbiters are trying to determine whose fault it was that the private firm lost billions of pesos in the past five years. He was so strict that he ordered Maynilad’s French partner, who wanted to take over as well, to show proof that it can do a better job. So a group of congressmen, allegedly working for Maynilad interests, lobbied Malacañang to make him choose between the public works portfolio and the chairmanship of the Metro Manila Deve-lopment Authority.

The unauthorized billings, scooped by this column in March, consist of P4.21 per cubic meter in accelerated extraordinary price adjustment (AEPA) and P4. 07 per cu-m in foreign currency differential adjustment (FCDA). Maynilad was allowed by MWSS to charge the AEPA from Jan. 1-Dec. 31, 2002 to recover losses from 1998-2000. But the firm continues to collect it to this day, taking more than P330 million from customers by end-March. Maynilad was allowed to collect the FCDA on condition that it remits to MWSS its monthly concession fee of roughly P220 million. It stopped paying the fee in March 2001 and had racked up a debt of P5.2 billion by March 2003, yet continues to collect. The MWSS regulatory board, separate from the board of trustees that Fernando chairs, ordered Maynilad last March to stop collecting, but was ignored. Fernando in turn ordered a legal study and advised angry consumers to sue. Concerned congressmen sought an inquiry on Maynilad, but their lobbying colleagues apparently beat them to the draw by getting rid of Fernando instead.

Maynilad had sent notice to MWSS in December 2002 that it wished to return its franchise because of yearly billion-peso losses. It said MWSS had lied during the 1997 privatization bidding about the extent of pipes that needed repairs, and refused to help it run after water thieves. It is seeking reimbursement of P19 billion in capital and operating losses. MWSS counters that Maynilad reneged on a promised capital infusion in 2002 in exchange for six rate increases since 1997, and thus is entitled to a return of only 75 percent of its initial capital, or P5.5 billion. Since Maynilad owes it P5.2 billion in concession fees, they’re just about even.

As the International Chamber of Commerce arbitrates the dispute, complaints mount about Maynilad’s deteriorating service. Fernando twice suggested to the trustees that they take over the concession until government finds a new operator for the west zone, which covers large swaths of Metro Manila and Cavite.

Ondeo, Maynilad’s 40-percent French group which has been feuding with 60-percent Benpres Corp., sought last month MWSS assent to run the zone with the International Finance Corp. While talks were going on, Maynilad got the ICC arbiters to bar MWSS from collecting the P5.2-billion debt from the firm’s $38-million performance bond. Not satisfied, it got a Quezon City court to issue a similar restraining order, a move that MWSS viewed as forum shopping which is disallowed by the concession contract. The MWSS suspended talks with Ondeo because of the apparent duplicity.

The question now is if Fernando’s successor, Florante Soriquez, will be as earnest in protecting government and consumer interests.

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Catch Sapol ni Jarius Bondoc, Saturday, 8 a.m., on DWIZ (882-AM).

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