IT used to be an innocuous office along Kalayaan Avenue in Balara, past Miriam and the Tuason’s former estate, La Vista. Sometime during Cory Aquino’s term, there was some brouhaha over the appointee to chair its Board of Trustees, one Porthos Alma Jose. I forget the specifics of why employees rallied against Alma Jose, which eventually led to his being replaced.
The Local Water Utilities Administration (LWUA) next came to great public notice when Doña Gloria appointed one Prospero Pichay, a year after being defeated in the 2007 senatorial elections. Such a low-profile position for one so high profile particularly in the defense of his Doña? But it seems there is so much to supervising the various local water utility agencies strewn all over the land than meets one’s ordinary eye.
Just recently, Pichay and his Doña’s anointees were extended midnight appointments to the board of LWUA. Among them are Renato S. Velasco, once a palace factotum who has been with the Doña from her senatorial days, and Susana D. Vargas, before then a deputy executive secretary in charge of Finance and Administration. Along with Prospero Pichay who was re-appointed to five-year terms, a recent appointee to the Board was one Bonifacio Maria Pena, the brother of a Negros Occidental mayor. And long-time "acting" administrator Daniel Landingin was finally given a "permanent" appointment.
Pichay of course was concurrently named Presidential Adviser on Political Affairs after Gabriel Claudio resigned for reasons of health. Whereupon, Claudio was re-appointed, also just a scant few months ago, to chair the MWSS, which deals with the water needs of Metropolitan Manila. While Pichay was unable to steer the Gibo campaign to victory or even close to one, he has clearly been very active in deals and operations that amount to nothing less than systematic plunder --- plundering water, so to speak.
He bloated the Capital Investment Program of the agency and disbursed a total of 3 billion 354 million in 2009, despite approval of only 2.4 billion, of which 400 million came from LWUA funds, 1.5 billion from the Department of Health, and 490 million from the DPWH. There is about 3.3 million more from foreign assistance. Now how was this done? There is an axiom in government expenditure procedures that state one can only purchase or bid out projects if there is an accompanying certification of the availability of funds.
LWUA’s Board of Trustees apparently took the assurance of Mr. Prospero Pichay that he had a commitment from Gloria Macapagal Arroyo to commit 6 billion pesos from the President’s Social Fund. Without clear availability of funds, they awarded a long list of projects in 2009, and used the LWUA Fund for some 1.24 billion pesos released to various water districts and charged the same to Receivable Miscellaneous-Miscellaneous Claims. In short, payable by the Government of the Republic of the Philippines.
The Commission on Audit in its May 24, 2010 report has ruled that the receivable from the GoP has no basis or legal document to back up the claim except for the verbal commitment (kuno) from the Office of the President as warranted by its Chairman Pichay. In short, laway lamang. And coming from one whose prefabrications of "fact" and contortions of "truth" have always had media questioning his credibility, the Board apparently was taken in.
Then again, listen to how the many water districts had been growling. Pichay’s men would tell them to submit a water project (especially those municipalities with little or no running water system), and ask them to bloat the amount to ensure that some people "upstairs" got a hefty cut. Not a "London Cut" as in prime rib, but a "King’s Cut", if you know what I mean. If the water district manager balked, the "operators" went to the mayor of the municipality, who, for his own "London Cut", would only be too willing to proclaim another "project for the benefit of his constituents". 2010 after all was re-election year for these local executives. Now how will the local water districts pay for these LWUA-extended projects? From their collections of course. And what happens if these collections do not suffice because the projects were overpriced to plunderous amounts? Problema na ng susunod na gobyerno. Or, he, he, he…lista sa tubig.
No wonder Pichay had himself re-appointed, along with Velasco and Vargas, in midnight fashion. May pagtatakpan?
And then there is Pichay’s foray into banking. Yes, banking!
In June of 2009, LWUA, as approved by its Board, purchased 60 percent of the total issued and outstanding common shares of Express Savings Bank, a private bank operating out of an office in Cabuyao, Laguna. For its 445,337 issued shares, LWUA paid 80 million pesos. Now read this: Express Savings is a thrift bank currently under rehabilitation, as administered by the Bangko Sentral ng Pilipinas.
Pichay had a dream. That together with the National Electrification Administration (NEA), he would conjure a Water and Energy Bank (WE Bank), and he brought the idea up to the BSP. But Deputy Governor Nesting Espenilla informed him that the BSP is currently enforcing a moratorium in the establishment of new banks and advised him to instead consider acquiring an existing financing company for the purpose of addressing LWUA’s financing requirements. And so, Pichay instead bought 60 percent of the Cabuyao bank. The OGCC (Alberto Agra?) sustained his action as within its corporate powers. The ESBI now controlled by LWUA then applied with BSP for quasi-banking authority. But BSP said it had to have at least 650 million pesos in minimum capital accounts.
In partial fulfillment of BSP requirements, LWUA then deposited 400 million pesos as "advance payment" to capital subscription pending BSP approval and SEC registration. But this is contrary to the General Provisions of the General Appropriations Act which restricts government-owned and controlled corporations from investing in non-government securities, money market placements and similar investments or deposit in private banking institutions. So what is the legal basis for Pichay’s grandiose dream of becoming a banker on top of being water czar? Nada.
But Pichay is wise too. Wise as in "wa-is" in everyday patois. He did not sign those water contracts. His "career" officials did. And in a gesture of appreciation, he had the "acting" appointment of Daniel I. Landingin as Administrator made permanent in the twilight of his Doña’s reign.
One more problem for the incoming administration of President Noynoy Aquino. But wait! The employees of the LWUA have been so scandalized at the high-jinks and financial legerdemain of their Chairman and his Board that they are willing to be the ones to bodily remove Pichay and his ilk from the premises of LWUA if the new president will just withdraw their questionable appointments. Bodily remove, or "kakaladkarin palabas" if necessary.
There must be a thousand and one acts committed under this Gloriannic reign in several agencies, departments and GOCC’s as well as GFI’s that qualify as "plunder". This is just one of them.
LITO BANAYO
MALAYA Column for Friday, 18 June 2010
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