PSP and C2C Teams Present to Association of Barangay Captains of Camalig The C2C Team was invited by the Association of Barangay Captains of Camalig, Albay on September 10, 2013. Learning of the activity, the PSP Team (Engr. Mary Rose Naparam and Ms. Lispeth Felin) rushed to the site and asked the Mayor to let them present too. Their request was granted. The C2C Team even suggested that the other party be allowed to present first, dispensing with the usual tossing of the coin. After the 30-minute presentation of PSP, the following exchange of words ensued. We quote the statements verbatim to preclude any accusation of distortion but provide a translation* for the benefit of non-Bicolano readers. Kagawad Lerma Camba: Both of the presentors are from ALECO management. Magayunon su planong pinagpresent nindo. Ngata ngunyan pa sana kamo na kaya man palan gibuhon kan ALECO? Ngunyan kamo nagpresent kaiyan. Mapasurog pa kamo sa San Miguel na kayang-kaya man sana palan na maresolberan an problema kan ALECO. Ngata na ngunyan pa sana? You are the management. Engr. Naparam: Ini po pinag-identify na solusyon kan Interim Board which the Management Committee is supporting and identified also as the solution para sa ALECO. Kun kaya po mapakarhay an ALECO 6 years ago, nagibo na kuta iyan. Six years ago bako pa arog kaini kagabat an problema, bako pa P4 billion su problema, kaya poi yan. Kaya ngani po yaon su private sector, su capital na available sa private sector iyopo ito an pig-tap ta ngani po magkaigwa ki working capital su ALECO ta ngani marehabilitate su ALECO. An objective po digdi is to turn around ALECO and rehabiliate, reduce the system loss to 9% and tumaas an collection efficiency to 96 up to 99%. Iyo po iyan an objective and improve the services sa mga member-consumer. Kasi po kami mandated kan EPIRA Law to observe the reliability indices. Sa ngunyan po bagsak po kami. Dai po kami minapasa sa evaluation kan ERC. Kgd. Camba: Dapat kuta dai nangyari ini sa ALECO kun kaito pang panahon nagibo nin matanos an management because the cause of ALECO’s problem is mismanagement. Engr. Naparam: It’s not a question. It’s a statement. To clarify further, an sabi ko ngani kasubago, gurano man kaagresibo kan management, an problema sa financial, an problema sa technical kaya iyan solusyunan ki marhay na strategy, agresibong management pero pag-abot po sa implementers iyo po an problema ta kanya-kanyang personal interest an nangyayari sa ALECO sagkod ngunyan. Mr. Albertito Laganzon: Naugmahon ako sang presentation mo. Dapat mag-C2C ka! Ano an kakayahan nindo magsabi, kamong duwa na kamo an nagpepresentar nu solusyon sa ALECO. You are the subordinates of these brilliant people. Ano an kredibilidad sang presentation niyo while the people of San Miguel are not around? Engr. Naparam: Actually itong surat po ni Mr. Ang nag-ano po ito because yung initial discussion na mag-join sinda sa information campaign in that roadshow. And yet an sabi ninda we are not yet the official concessionaire of ALECO because you have not yet awarded to us the contract. So wara pa po sinda nin personality to come here and discuss. An presentation mi is general, Private Sector Participation. It just happened na na-conduct na su bidding. Actually the bidders were requesting. Dapat unahin muna yung referendum which one to choose. But then it was DOE Secretary Petilla (who said) no, unahin ang bidding for us to see the technical offer of those bidders na willing mag-bid. So, kun ginibo kaya su referendum before kan bidding wara po kami na ipepresentar saindo na P250 million up to P1.2 billion na dadarahon sa ALECO magin world class distribution utility an ALECO. So, that is the objective. Ngata inenot su bidding and ngata bako parte an San Miguel sa information campaign? An sabi po kan San Miguel Albay has to determine their solution. We are more than just willing to help the province of Albay. Mr. Laganzon: Ngata ta ining mga presentation ninda dai nagtatao kisolusyon para an taga-Albay iyo nguna an mag-invest. Dapat taga-Albay ka, ma-invest ka ta cooperative ini. Engr. Naparam: Actually ining option as a stock cooperative. Saro man po iyan sa option. Kaya lang po sa sitwasyon kan ALECO ngunyan an stock cooperative su makua kita nin share para sa dagdag na pangangapital kan ALECO. But it will take time para maka-raise up kita nin amount. So, ini na po. Ini pribado. Available na su pangangapital ninda. Kun we opt for stock after the concession period we can identify another option or framework for ALECO kasi yaon pa man po giraray su ALECO. Another participant: Galing ng presentation so it’s clear to us na ganoon ang PSP. Dai ko aram kun question ito o message. Ngunyan po sa nangyayari pag an mag-invest San Miguel corporation style. Pwede siyang magin chairman of the Board. Siya nagluwas ki kwarta. Siya na magdidikta kan operation. That is an insult to Albayanos na kami po an nagtatao ki kwarta sa ALECO pigma-manage kan San Miguel. So garo biased po kamo sa ALECO na kamo pa rin an nagpepresent although dai pa ninda authorized pero an nagpi-present kan option. So, parang biased an sistema kan ALECO. The C2C team presented. The speaker, Virgilio S. Perdigon, Jr., asked the audience to remember just four things: (1) A private company will never bring money into an enterprise without thought of recouping it later with a profit. Any person who gives ALECO P250 million and does not get it back is not a businessman but Santa Claus. (2) Why should we choose an alleged good quality service with high price when there is a sure good quality service with a low price? (3) What ALECO needs right now is equipment, not cash. The equipment are ready to be brought in by BENECO and other cooperatives. Cash will be needed at a later time and it can be sourced from inside ALECO. (4) The P4 billion indebtedness of ALECO is like a disaster. BENECO is coming as a “rescue volunteer.” As such, BENECO should not be required to produce Terms of Reference or Memorandum of Agreement. San Miguel is coming as an investor that will profit from our misery. It is only proper that the company be required to have Terms of Reference. When Team Albay went to Mindanao and Metro Manila to help disaster victims, it was not obliged to produce a Board Resolution, MOA or TOR. It was welcomed by the people. BENECO, however, was grilled by Mayor Noel Rosal of Legazpi in front of some 500 people. Bicolanos are not that inhospitable to “rescue volunteers.” The presentor showed the historical background of ALECO’s problems and The Big Difference (please refer to a previous post) between C2C and PSP in terms of sourcing funds for debt payment and capex. It was shown that under C2C, the debt will be paid from the savings in systems loss reduction and prompt payment discount. Under PSP, San Miguel will pay concession fee which ALECO will turn over to PEMC etal. To recover the amount, San Miguel will collect and profit from the savings in systems loss reduction. Hence, the money for debt payment will just come from ALECO member-consumers. We will be “fried in our own fat.” It was further shown that under C2C, capex will be sourced from the RFSC (Reinvestment Fund for Sustainable Capex) which is Item No. 9 in the bill amounting to P0.2178 per kWhr. Managed well, the RFSC can provide the funds for procurement of transformers, electric meters, etc. Under PSP, San Miguel will shell out P250 million for the procurement. To recoup the amount andrealize a profit, a new fee will be introduced in the bill to be accumulated as a new fund which San Miguel will claim. Hence, the money for capex will just the same come from ALECO member-consumers. We will be “fried in our own fat” twice. Only one matter was raised by the audience: the BENECO Board Resolution asking for a NEA Project Supervisor. (Please refer to another previous post.) Ms. Felin, head of Finance Division and second presentor of the PSP Team, volunteered to show a copy of the resolution. The C2C Speaker then asked her to read it in toto. Ms. Felin happily obliged. As she went through the provisions, it gradually became clear that the content was favorable to BENECO as it manifested the cooperative’s transparency. The C2C Speaker pointed out such fact. Ms. Felin did not finish reading the resolution on the excuse that the text was blurred. The assembly dispersed shortly thereafter. Engr. Naparam and Ms. Felin went home with very low spirits. (*Translation: Councilor LermaCamba: Both of the presentors are from ALECO management. You presented a very beautiful plan. But why are you presenting it only now? You would even ask for help from San Miguel when you are saying that the problem can be easily solved? Why just now? You are the management. Engr. Naparam: This is the solution identified by the Interim Board which the Management Committee is supporting. Six years ago, ALECO’s problem was not this big. The debt was not yet P4 billion.That’s why the private sector is here to provide working capital and rehabilitate ALECO. The objective is to turn around ALECO, rehabilitate it, reduce the system loss to 9%,raise collection efficiency to 96 up to 99% and improve the services to member-consumers. We are mandated by the EPIRA to observe the reliability indices. Right now we have failing marks under the evaluation of ERC. Councilor Camba: Proper management should have been done a long time ago. The cause of ALECO’s problem is mismanagement. Engr. Naparam: It’s not a question. It’s a statement. To clarify further, I said earlier that if the problem is financial and technical, it can be addressed by good strategy, aggressive management. However, implementors have their personal interest. That still happens. Mr. Albertito Laganzon: I am very happy with your presentation. You should support C2C! What is your capability to present a solution to ALECO’s problem? You are the subordinates of these brilliant people. What is your credibility to present all these while the people of San Miguel are not around? Engr. Naparam: Actually Mr. Ang cited in his letter that they could not join the information campaignsince they are not yet the official concessionaire because ALECO has not yet awarded to them the contract. So they do not have yet the personality to come here and discuss. Our presentation is general, Private Sector Participation. It just happened that the bidding has been conducted. Actually the bidders were requesting that the referendum be conducted first. But then it was DOE Secretary Petilla who said no, conduct the bidding first for us to see the technical offer of the bidders.If the referendum came ahead of the bidding we would not have presented the P250 million up to P1.2 billion which ALECO could use to become a world class distribution utility. So, that is the objective. Why was the bidding conducted ahead of the referendum and why was San Miguel not part of the information campaign? San Miguel said that Albay has to determine their solution. We are more than just willing to help the province of Albay. Mr. Laganzon: Why do they not offer these solutions to Albayanos who would be willing to invest? Engr. Naparam: Actually this option is the conversion to a stock cooperative. That is another option. However, under the situation of ALECO, raising capital through stocks will take time. So, PSP is the solution. This is private. Their capital is available.After the concession period we can identify another option or framework for ALECO because the cooperative will still be there. Another participant: Your presentation is so it’s clear to us.I do not know if this is a question or a message. The investment of San Miguel will allow it to appoint a Chairman of the Board and dictate the operation. That is an insult to Albayanos who give money to ALECO which will be managedby San Miguel. So it appears you are biased in presenting an option while you do not have the authorization.)
Posted on: Thu, 12 Sep 2013 04:31:03 +0000
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