10 August 2008
The smooth passage of the national franchise bill for the National Transmission Corporation (Transco) last August 6 deserves utmost attention especially on the part of the Senate where the bill needs full concurrence. The action of the House almost came unnoticed by the unsuspecting public because of the unusual silence during committee deliberations and until it finally passed the third reading. The stealth in the way the bill passed the House is perhaps worth examining.
Although House Bill 3729 is principally sponsored by no less than Speaker Prospero Nograles himself and supported by the House’s top leadership, the nature of the proposed measure we believe was such controversial to elicit silence, lest blind approval from members of the House.
It can be recalled that the process of privatizing the national transmission system went through many glitches and controversies which led to four failed bidding since 2003. Even the last bidding held in December 2007 was concluded not without issues raised against it in public as well as in courts. In fact, after the December bidding, Senator Jamby Madrigal filed a resolution asking the Senate to investigate the validity of the award to a consortium which she claimed was being backed by Ricky Razon, a known friend and ally of the First Family. Aside from that, during his speech before being kicked out of the speakership in February 5, 2008, former Speaker Jose De Venecia alluded to people who cornered the Transco sale as those who were also behind his ouster.
Now, why the deafening silence in the House? Where were the ‘honorable’ members of the House? And also, where was the former Speaker who vowed to expose people he wanted to unmask? We do wonder.
The Freedom from Debt Coalition avers that by experience, a smooth passage of an important bill in the House could only mean two things. First, the bill is popular but less controversial. Second, it is a compromise bill between the majority and the minority. Definitely the Transco franchise bill does not fall to the first category.
With allegations of bribery now hounding the judiciary on the issue of Meralco-GSIS row, the same issue may also hound the legislative branch as it had during the passage of the Omnibus Power Bill (now EPIRA) in 1999 and 2001. Thus, a question is again posed: Did money also flow in the House with the passage of Transco franchise bill?
The Power Sector Assets and Liabilities Management Corporation (PSALM) awarded the operation of the Transco system to the consortium of Monte Oro Grid Resources Corp., Calaca High Power Corp., and State Grid Corp. of China for a price of $3.95 billion. The award was a 25-year contract to operate the Transco, renewable for another 25 years. Transco needs a national franchise from Congress before the consortium can start commercial operations.
FDC is opposed to the privatization of Transco because we believe that as a natural monopoly and considered the backbone of the industry, it properly belongs to the state and must remain under its control. Moreover, rates are also expected to rise as a consequence of privatization as investors would try to recover their investments the soonest time possible. We also believe that placing the 21,319 circuit kilometers transmission lines nationwide under a private operator is a national security concern.
Lastly, we want to reiterate that privatizing natural monopolies such as transmission lines will totally eliminate the government responsibility in providing service in the power industry. Electricity as a critical element of national development and social progress should not be treated as purely private business that is left at the hands of few elites.
In this juncture, FDC relies on the wisdom of refutable members of the Senate in scrutinizing the legality and propriety of the national franchise being applied for by Transco. Although Transco privatization is mandated by EPIRA, rejecting the franchise application can effectively stop that process of privatization, which for us would also be a good opportunity for the Senate to ponder while EPIRA is also still under the process of amendments and review in the upper chamber. -30-