EO to suspend GOCC perks

MANILA, Philippines - Malacañang will suspend for two months the bonuses, allowances and other perks of top executives of various government-owned and controlled corporations (GOCCs) and government financial institutions (GFIs) as efforts are underway to have them slashed or removed.

Budget Secretary Florencio Abad said an executive order (EO) for the suspension and eventual removal of these monetary perks has already been submitted to President Aquino and is expected to be released next week.

“The economic managers agreed that we should endorse the resolution of the Senate which was transmitted to us, it’s a (resolution expressing the) sense of the Senate calling for the suspension of the grant of bonuses and other perks of GOCCs and GFIs,” Abad said in a press conference. The suspension will allow budget officials to “rationalize” figures and come up with a reasonable compensation and benefit matrix.

The Senate finance committee on Tuesday asked Mr. Aquino “to suspend all the fat, excessive, and obscene bonuses and other benefits” being enjoyed by GOCC and GFI executives.

Abad stressed only the members of the board would be covered by the suspension and not the operating officers and regular employees.

According to Abad, the only exception to the suspension “is reasonable payment of per diem” for attendance in board meetings.

“Within two months, we hope to be able to put together, rationalize the system of compensation, allowances and benefit packages for the officials and members of the board (of GOCCs and GFIs),” Abad said.

The budget chief explained that Cabinet secretaries are each entitled to P22,000 a month for attendance in meetings.

“I don’t know if that’s reasonable as far as GOCCs and GFIs are concerned,” Abad said.

Mr. Aquino said Administrative Order 103 series of 2001, which outlines austerity measures, has not been implemented.

“Of course, there is some resistance from those who have gotten all of these fat pays. But we will insist that their positions are due to the government and the benefits are also due to the government,” Mr. Aquino said.

“So hopefully by next week that will become part of the law of the land. They have to do an inventory of all the GOCCs – all the various pays that they are getting, the bonuses, etc. – the legalities of how they manage to afford themselves of all of these and come up with an all-encompassing EO that will rationalize, put a cap or a limit to what should be the pay packages for these government nominees,” Mr. Aquino said.

Communications Operations Secretary Herminio Coloma earlier said the Senate resolution was consistent with the President’s desire to weed out corrupt practices in the government.

“If you will recall, during his State of the Nation Address, he cited the specific case of Metropolitan Waterworks and Sewerage System and that specific case may have triggered a more comprehensive investigation by the Senate committee on finance headed by Senator (Franklin) Drilon,” Coloma said. “And as we now know, the truth about compensation in GOCCs has surfaced and this follows the report of the Commission on Audit that was given weeks ago regarding compensation of top officials of GOCCs,” Coloma said.

Coloma said Mr. Aquino had exposed the previous government’s failure to rein in high-ranking executives of GOCCs and GFIs.

“So from the time that the President spoke about it in the SONA more than a month ago, our people have now become more aware that this is a bigger problem, that the independence of the GOCCs that had not been reined in during the previous administration has produced a very unwelcome and a very unwholesome situation where employees and retirees of such corporations are deploring the fact that while their basic benefits have not been given, the high-ranking executives of these corporations have in fact been receiving fat bonuses and allowances,” he said.

Coloma said a lifestyle check on GOCC officials might not be needed in the meantime since government officials are required to periodically file their Statement of Assets, Liabilities and Net Worth.

“We have administrative mechanisms on checking their lifestyle,” he said.

The announcement of the coming issuance of an EO came a day after Speaker Feliciano Belmonte Jr. explained that Mr. Aquino may order a cap on the GOCC executives’ financial perks without waiting for legislative approval. He said Mr. Aquino’s mother, during her incumbency, issued a directive putting a cap on the compensation of GOCC executives.

“There is already an existing law, it’s an AO (administrative order 103) series of 2001 that was not yet implemented,” Mr. Aquino said.

“I am awaiting the draft coming from the DBM (Department of Budget and Management) on how to tighten up that existing AO precisely to prevent the excessive pay, benefits, packages that the GOCCs have been enjoying and have been basking in for a long time,” Mr. Aquino told reporters at the Convergys office in Manila which he visited yesterday.

Aurea Calica, Philippine Star