The stink of corruption

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By Neil Honeyman

An Independent View

Wednesday, April 2, 2014


WE WENT to San Carlos City on Sunday. The City of Smells is living up to its local sobriquet. Nothing seems to be done about the malodorousness allegedly emanating from the San Carlos Bioenergy Inc. (SCBI) plant.

The stink is even-handed, however. Even the offices of the Department of Environment and Natural Resources (DENR) are well-nigh uninhabitable. But perhaps constant exposure engenders immunity and it is only the occasional visitor who is affected.

The fish kill continues. Depriving fisherfolk of their livelihood is unacceptable. Something must be done, and quickly.

An independent audit is required.

Does SCBI comply with the conditions of its Environment Compliance Certificate (ECC)?

Has SCBI ever complied with its ECC conditions?

It becomes tedious to hear of the pious outpourings of the renewable energy lobby if it is unable to adhere to its own culture.

In fact, the cynical ones would say the renewable energy projects are given an “inside track” simply because they involve renewable energy.

Our concerns about coal are well-founded. As a result, the coal industry is subject to stringent controls which, of course, are eminently justified. Coal-fired electricity generating plants are now seemingly less environmentally unfriendly than SCBI which is becoming renowned for its adverse effect on the environment.

A shutdown until the problem is solved and an independent inspection is satisfied that no recurrences will happen may be the only answer.

*****

Over the past four years the Philippines has improved its position in the corruption league table by 40 countries. But corruption, in absolute terms, remains high. We focus on the public sector where horrendous revelations appear with depressing regularity. Unfortunately these cases never seem to be closed and the backlog is steadily increasing. Ombudsman Conchita “zero backlog” Carpio Morales has some explaining to do.

We believe that there is need for a “value-added” audit of the Ombudsman’s Department. I gain the impression of insouciant lawyers leisurely perusing the papers produced by others. Where is the added value in that? The Ombudsman’s office is constitutionally mandated to carry out investigations, but I do not gain an impression of the nefarious ones quaking in their shoes at the approach of the Ombudsman.

Bacolod City Mayor Monico Puentevella’s case is an example. I do not see much contribution from the Ombudsman. If Monico did not have tenacious adversaries, would we have ever seen his case making any progress?

*****

We focus on public sector corruption, but is the private sector any better?

The Philippines is 94th in the corruption league table. We believe that the financial services sector (banking and insurance) contributes to this lowly position.

One of the problems is that there is no real checks and balances from government entities over the retail conduct of banks and insurance companies.

The Insurance Commission undertakes desk research to examine whether insurance companies meet their capital adequacy requirements, but this work did not anticipate the Philamlife debacle resulting from the AIG collapse in 2008.

The Insurance Commissioner Emmanuel Dooc talks in terms of Filipinos not investing heavily enough in insurance products (only 0.9 percent of GDP) but he may not have experienced the financially illiterate commission-based salesmen that we encounter from time to time.

Consumer protection from the Insurance Commission is inadequate. If we are to have consumer protection in the financial services sector, there must be a level playing field when a dispute arises.

Currently, the financial services sector retains the upper hand over the hapless consumer. It is time that the relevant government entities [Bangko Sentral ng Pilipinas (BSP), and the Insurance Commission] address this problem. The BSP equivalents in other countries have found it necessary to do so and have produced necessary instructions to inadequately-managed banks.

The inter-bank electronic banking networks are extremely weak and there are no internal or external (from BSP) pressures to change this unsatisfactory state of affairs. Weak systems create corruption opportunities as has been revealed by recent ATM scams.

Corruption is still perceived by the voter as the No. 1 problem.

We should focus equally on the public and private sectors in our fight against corruption.

Is the Integrated Bar of the Philippines making any progress resulting from its earlier advertisements which stated that it would be fighting corruption?

Published in the Sun.Star Bacolod newspaper on April 02, 2014.

Opinion

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