PGMA's Speech during the Awarding Ceremonies for Outstanding Electric Cooperatives (ECs) and MOA Signing on the Merger of three Cebu ECs

Ceremonial Hall, Malacaņang (11 Sept 2003)

Thank you very much, Secretary Vince Perez.

Congressman Kintanar, who is here to witness the merger of the three outstanding cooperatives in Cebu; Secretary Bunye; Father Silva; Sotero Gan, member of the NEA board; Mr. Villera, the awarded President of PHILRECA; APEC Party List Congressman Sonny Madamba; awardees of the outstanding cooperatives; friends from the rural electrification sector; DOE family, especially the 14,000 workers in the electric cooperatives who are listening to us all over the country at this very moment.

A year ago in this very hall, I promulgated Executive Order 119. It was a smaller group then. Now, I’m glad we have a big group representing the 119 electric cooperatives of the one-one that were affected by E.O. 119. Coincidence? No, I think it’s providence. E.O. 119 condoned the 119 power cooperatives electrification loans amounting to some 18 billion pesos.

But that condonation was not unconditional. That condonation was conditional. I granted it but I return, I demanded better services, bold reforms and a permanent commitment to integrity.

Today, I was glad to hear the report of Father Silva that of the 119 subject of E.O. 119, 72 electric cooperatives have complied with my conditions. Congratulations then to these law abiding 72.

Another 23 partially complied with my list of required reforms, and to them, good luck! Congratulations and good luck on your continuing reforms.

Only 21 continued to show dismal performance, and you will have the special attention of Father Silva again.

Consistent with my earlier pronouncement last year therefore, let me make these announcements.

For the 72 cooperatives that showed substantial compliance. The reward is the following.

First, greater autonomy and empowerment. Which means less government regulations. At the same time, conducting and or support for access to private sector funds and assistance.

For the 23 that are on the borderline, a second assessment shall be done to determine whether of not given more assistance to improve their efficiency and reliability they can survive in an environment of domestic and global competition.

Now, as regards the cooperatives that miserably failed to achieve their targets, It would be the height of injustice to the others – the 78 and the 23 – to allow these 21 to continue subjecting their members to difficulty or distress. And that’s why I said Father Silva will handle those in a very special way.

If we want to strengthen our Republic – and let me stress, I am not claiming we have a strong Republic. I’m saying we must strengthen our Republic – and if we are to strengthen our Republic, we must strengthen the institutions that provide basic services to our people. Now is the time for these 21 who have not complied. Now is the time to allow other players imbued with responsiveness and capability to step in and implement the needed reforms – bold and unprecedented no matter how unpleasant some of them may be.

I am therefore reiterating my directive to the NEA board of administrators, particularly Father Silva, to take the most viable on the options or alternatives in accordance with our regulatory framework, and within the bounds of law, rules and regulations to pursue viable solutions such as – though not limited to – merger or consolidation, joint ventures, investment management contracts or management takeovers.

After all, look at three outstanding cooperatives – Cebu. They’re already very good and yet they have decided to go under joint management to become even better. What more those who continue to be inefficient.

We will not stop there. I’m also instruction the NEA to do the following:

Organization and promotion of watchdog committees composed of influential sectors in the local communities; institutionalization of its program on that compact of cooperation where good performing coops help the poorly-performing ones in all areas of operations. We did that – SAMSURECO helping Basilan, Cebu helping Aklan. And we have seen the results because some of them were those who received the awards today.

I’m also instructing NEA to undertake the brokering of financing from private lending agencies.

Public sector welfare if the ultimate measure of our performance, we will continue to aim for reliable power supply and affordable electric rates. Of course, to have reliable power supply and affordable electric rates, we must have a reduction of systems losses.

I am glad that the reforms in just one year alone have brought down the average systems loss from about 16 to 15, but 14 is the statutory cap. And therefore, I urge everyone including the "A" performing ones to improve even more to bring down the average on the systems losses.

These constitute bottomline reliable power supply, affordable cost and systems losses of no more than 14 percent. They make up the bottomline. And we must maintain this bottomline through excellence and performance.

That’s why I congratulate the awardees of this year as well as the previous years especially who’ve gotten their hall of fame awards. For many of them especially the turnaround ones we have been involved or I’ve been aware of what has happened to them.

For instance, Boracay – the AKELCO. It was a painful decision for me because my political allies were at the shorter end of my instruction. But we had to have a management takeover and now they’ve received an award as one of the turnaround cooperatives.

When I was in Bohol, I witnessed the MOU for joint management. And now, they are again with their Hall of Fame Awards for Outstanding Management.

I mentioned Basilan complaining about fluctuations so frequent that in the squatter areas they had to have candles. And these candles – one of them fell from a table and caused a whole fire in a whole squatter area. And it was at that moment that I decided somebody must take over that electric cooperative.

SAMSURECO did and SAMSURECO is and outstanding cooperative, one of the awardees today.

I remember the phone calls about the crisis in Camarines Norte, and we had to make a decision. I called Father Silva. ""take over," and now Camarines Norte is one of the turnaround awardees today.

Therefore, the political will that Vince talked about works. They were painful decisions, politically painful decisions sometimes, to do the take over or force merger. But they have worked. And as I said, even the best ones are merging management. May their example lead other electric cooperatives also to consider the greater efficiency that comes with merger and economies of scale.

You are immensely contributing to the arduous task of galvanizing rural communities and igniting enterprise in the countryside. You cannot have irrigation without electrification in the countryside. You cannot even have the modernization of elections without electrification in the countryside.

I am therefore instructing Secretary Vince Perez to meet with the officials of COMELEC to ask them what infrastructure support they would need from DOE, NEA and PHILRECA to make sure that computerization and modernization will be a reality in our rural polling places.

Jointly, indeed, the NEA and the electric cooperatives are among our dependable pillars of building a strong Republic. Together we have done so much in one year of E.O. 119.

Let us carry on and strengthen the institution of rural electrification.

Congratulations to all of you.

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