Panay Electric Co., or PECO, is fighting a losing battle in Iloilo City. Stripped of a franchise, PECO has become a shell company and the only honorable way out is for it to cut its losses.
For starters, PECO has already alienated many of its 65,000 customers for a decade, infuriated the city’s legislative council and found itself fighting the city hall in a losing cause.
Iloilo City Mayor Geronimo “Jerry” Treñas in 2006 approved the recommendation of the City Treasurer’s Office to enforce a court ruling that favored the imposition of real estate taxes on privately-owned utilities like PECO. The city wanted to tax the land where PECO’s electricity poles stand on the side of the Iloilo’s streets.
Treñas left the mayoral post and had a nine-year stint as the city’s lone representative to Congress. Some 10 years later, Treñas returned to his favorite stomping ground only to learn that PECO contested his directive. PECO put the money in escrow before the court ruled again in the city’s favor.
PECO, however, remained defiant and asked the Local Assessments Board to re-compute the company’s realty tax arrears. PECO’s realty tax arrears, per the computation of the the city government, have added up to P90 million with no penalties by March this year.
The City Treasurer ordered the City Business Permit and Licenses Office to deny the company’s business permit this year. The Local Revenue Code prohibits a local business from getting any city licenses and permits until they settle any tax obligation with the city.
Mayor Treñas is seeking a quick resolution of the issue as PECO’s loss of franchise will force it to cease operations. The utility’s current provisional Certificate of Public Convenience and Necessity from the Energy Regulatory Authority will expire one-and-a-half years from now when the new franchise-owner, More Power and Electric Corp., completes the takeover of the city’s distribution system.
PECO has offered to settle the P90-million tax arrears and the penalty of P7 million in several tranches within a couple of years, but the City Treasurer dismissed it.
PECO, meanwhile, has riled Mayor Treñas further. Cacho heir Marcelo Cacho ignored the mayor’s complaint filed with Malacañang against the rising number of electricity pole fires in the city based on the official report of the Bureau of Fire Protection.
PECO and the Cachos know that they can’t fight the City Hall. They no longer have the ammunition to wage the battle. If PECO loses ownership and control of the distribution assets in a December 12 auction, including the 30,000 electricity poles that dot the city’s streets, the utility no longer has a reason to exist, unless it manages to redeem the same assets within the one-year period allowed by the law.
Unless stopped by a court or a settlement is reached between the city government and PECO, or the utility redeems its distribution assets by paying its tax arrears, PECO will simply cease to exist. Its distribution assets and poles, the lifeblood of an electricity retailer, could be won by the highest bidder in the December 12 public auction.
Filipinos no longer unbanked
A study conducted by the Bangko Sentral ng Pilipinas Consumer Expectations Survey in late 2018 indicates that six out of 10 Filipino families do not have any form of savings. Over 2 million are also considered unbanked and unable to access financial products and services.
This unserved segment of the population often resorts to informal lending practices to provide for the everyday needs or meet unforeseen expenses. Without any savings, most people also experience financial stress and are unable to realize their dreams, for themselves and their families.
It is no wonder that the BSP has been encouraging banks and similar institutions to boost their financial inclusion initiatives, especially among the lower income segment, towards empowering them to become financially independent.
Cebuana Lhuillier is one company that has been focusing on financial inclusion by advocating the benefit of having a micro savings, and growing it, little by little, towards achieving financial freedom in the future.
Just this year, the country’s leading micro-financial services provider launched its “#Kaya Na: Unbanked Filipinos No More” campaign geared towards converting Filipinos into instant “iponaryos” or those who are actively saving up their hard-earned money in a micro savings account.
In carrying out its mission, the brand has empowered its over 8,000 employees in more than 2,500 Cebuana Lhuillier branches nationwide to become iponaryo ambassadors, visiting far-flung communities, schools and workplaces to teach Filipinos how to manage their spending, save money, keep it safe and grow it further through an interest-bearing micro-savings account.
“This ground-breaking product was designed with the premise that Filipinos, given the right financial tools and opportunities, can be captains of their own ship, navigating their life towards financial freedom,” says Jean Henri Lhuillier, president and CEO of Cebuana Lhuillier.
To date, more than 500 pocket sessions nationwide have resulted to the opening of more than 2.5 million Cebuana Lhuillier Micro Savings new accounts, converting ordinary Filipinos to iponaryos.
E-mail: rayenano@yahoo.com or
extrastory2000@gmail.com or business@manilastandard.net
