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Lawmakers seek revamp of PCSO

A panel in the House of Representatives will recommend a revamp of the leadership of the Philippine Charity Sweepstakes Office if allegations of solicitation against the agency are proven true.

House Minority Leader and Quezon Rep. Danilo Suarez, chairman of the Committee on Public Accounts, said his panel, together with the House Committee on Games and Amusements, chaired by Rep. Gus Tambunting of Parañaque City, floated the idea as the Lower House resumed its public hearing the PCSO’s operations of the Small-Town Lottery.

Suarez said allegations of solicitation are a “cause for concern.”

“The objective of the hearing is to come up with some verification of what we can identify as serious concern in connection with some allegations that in the manner of expanding our request to nationalize gaming, we have some information that areas are being peddled out to the highest bidder,” said Suarez.

He said there is somewhat very little consideration given on the capability of the supposed player and instead, what is being considered is the amount involved.

Tambunting said in his opening remarks that the PCSO conceptualized the STL pursuant to Republic Act 1169, as amended, as a source for its additional Charity Funds; as an alternative source of income for marginalized Filipinos; and to combat jueteng and other illegal number games.

He said that the PCSO as the lead agency for raising and providing funds for health programs, medical assistance and services, and charities of national character.

Tambunting said the STL is being implemented locally all over the country through an Authorized STL Agent or ASA. Maricel V. Cruz

“The performance and compliance of the ASA to its Guaranteed Minimum Monthly Retail Receipts or GMMRR will determine the success or failure of the STL,” Tambunting said.

Suarez stressed that when a franchise to operate the STL is given to a certain operator, it cannot be subcontracted and will be a ground for cancellation of the franchise.

“It cannot be jointly operated, there can never be a memorandum of agreement or a partnership. The award is given to an entity and it is non-negotiable,” he clarified to which PCSO General Manager Aelxander Balutan agreed.

Suarez cited the case of Southern Rock Empire Corporation based in Sultan Kudarat that was awarded with the franchise to operate STL in that area.

He said he received reports that the said STL corporation sold its franchise to two individuals, a certain Ed Esconde and Mike Malindong.

“Then Mike Macalindong and Esconde sold 50 percent of the franchise to a certain individual for P27 million,” Suarez said.

He added that another STL operator, the JY Archers Games and Entertainment Corporation of South Cotabato also sold its franchise for P50 million.

“We’re not saying that these are verified and true statements. These are allegations,” Suarez said.

He said he also received reports that both the chief of staff of PCSO Chairman Anselmo Pinili and PCSO General Manager Alexander Balutan are involved in the so-called solicitation on the particular matter.

“This is pretty alarming, alarming because nawawala yung essence, yung aming gusto na i-nationalize STL to generate employment and revenue because if that will be the case, di pa tayo nagsimula, mali na yung procedure,” Suarez said.

Suarez added that he even heard remarks to “not pay attention to the concern of Congress because they will be adjourning soon and the President will not stop STL.”

He said that he may agree that the President does not have any intention of stopping the operations of the STL but the committee can recommend a thorough revamp of the leadership of PCSO.

“And if proven that these allegations are valid, then there is enough ground for the position of the chair to transmit to the President, to be signed by the Speaker and the chairs of the joint committees asking for a revamp on the leadership,” Suarez said.

He said that this is precisely the reason why the hearing was conducted – to verify the validity of the allegations.

Meanwhile, PCSO) General Manager Alexander Balutan on Thursday said the February sales of Lotto products dropped by 39.19 percent, but he clarified that this is only temporary since the lottery products are “jackpot-driven.”

“Sales for the month of February declined by 39.19 percent, registering only P1,587,785,710 sales compared to the same period last year with P2,611,320,180. Of all Lotto products, Ultra Lotto 6/58 had the highest drop by 60.11 percent with only P166,254,440 sales, compared with P416,886,040 sales last year,” said Balutan.

Lotto 6/42 followed by -32.08 percent to P141,526,380 from P208,376,100 sales last year; Mega Lotto 6/45 by -29.03 percent to P151,347,480 from P213,281,080; Super Lotto by -28.32 percent to P146,748,500 from P204,748,760; and Grand Lotto 6/55 by -17.22 percent to P166,990,240 from P201,736,720.

“’Yung Lotto games kasi natin are jackpot-driven sales. Ina-associate kasi natin ‘yan sa jackpot prize natin. Kapag mataas ang jackpot natin, malaki din ‘yung nagiging sales. But we are expecting sales to pick up in the succeeding months,” added Balutan.

As for the digit games, 3 Digits registered the highest decline by 51.97 percent to P342,821,210 from P713,824,280; followed by EZ2 by -28.36 percent to P421,705,720 from P588,685,380; 4-Digits by -22.74 percent to P32,463,880 from P42,022,850; and 6-Digits by 17.60 percent to P17,927,860 from P21,759,320.

Keno sales also declined by 50.37 percent to P219,643,880 from P442,580,610.

Last January, Balutan reported a P1,930,393,950 overall sales for Lotto and digit games, which is 30 percent lower compared to the same period last year.

“As I said earlier, we won’t be expecting much, much higher revenues this year. Hindi na gaanong tataas. Baka nga mag-plateau na ang sales natin. Ma-maintain lang natin ‘yung P63.55 billion o umangat lang ng konti eh matindi na ‘yun. There is no possibility na ma-i-angat pa natin ang kakayahan natin, but sales will definitely pick up in the coming months kapag tumaas ang ating jackpot prize. Hindi naman kasi pwedeng walang manalo,” said Balutan.

Arnel Casas, Assistant General Manager for Gaming Sector, identified two factors why sales declined this month: Jackpot prize and tax.

 “One of the reasons for such low sales for the first two months in 2019 was we currently do not have high jackpot amount up for grabs and its really mind blowing that in a span of two months, there were 16 winners that hit the jackpot for various lotto games,” said Casas.

Casas said that for many lotto players, having a minimum jackpot amount for lotto games does not usually entice players. They tend to play when jackpot prize increases and accumulates, and it only happens when it is not being hit or won.

“Another reason that contributes to low sales is the implementation of TRAIN (or Tax Reform for Acceleration and Inclusion) law, which we are trying to counter with the implementation of ‘balik-taya’,” added Casas.

The implementation of TRAIN law in 2017 brought about harsh taxes to personal income tax, estate tax, donor’s tax, value added tax (VAT), the excise tax of petroleum products, automobiles, sweetened beverages, cosmetic procedures, coal, mining, and tobacco, including PCSO’s document stamp tax (DST),

Under the new TRAIN law, lottery tickets were subject to higher DST prompting PCSO to impose a new price scheme for Lotto and other gaming ticket prices from P5 to P6, P10 to P12, and P20 to P24.

The TRAIN law also imposed a 20-percent tax on winnings of more than P10,000 from Lotto, Keno, Small Town Lottery (STL), sweepstakes, and other PCSO products.

Topics: House of Representatives , Philippine Charity Sweepstakes Office , Danilo Suarez , Small Town Lottery
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