NOY SAYS: NO REVOLVING DOOR POLICY IN APPOINTING NEW AFP CHIEF
MANILA, MARCH 8, 2011 (STAR) By Aurea Calica [Photo is loading... President Aquino and new Armed Forces chief Lt. Gen. Eduardo Oban Jr. salute during the turnover of command at Camp Aguinaldo yesterday. WILLY PEREZ]
MANILA, Philippines - President Aquino assured the people that he is not advocating a revolving door policy in the Armed Forces of the Philippines (AFP) amid questions on why he chose Gen. Eduardo Oban when there were other candidates who could serve longer.
"That is not going to be a policy to give everybody a modicum of time. It's always going to be the best person available at this time regardless of the position," Aquino said.
The revolving door policy is a practice of appointing as chief of staff the military official who would retire soonest so that each one will get the chance to be at the helm of the organization.
"The AFP does not make policy in government, it's the executive that makes policy supported by the legislature and checked by the judiciary. So they are the implementors. There has to be continuity of the implementation of policies… for instance, (the) very specific example (is) modernization. Can each chief of staff (have) different thrust in modernization? No, it really needs planning to get the resources to implement what is needed," Aquino said.
"So whoever is the chief of staff basically implements what has already been decided upon," he added.
Bring dignity back to AFP
President Aquino yesterday rallied the soldiers anew to continue helping him bring back the dignity of the military while he also works on the other problems of the country.
Speaking at the turnover of command at Camp Aguinaldo in Quezon City, the President again called on the military to help in the fight against corruption in government by reporting to him even local government officials involved in irregularities.
"The people are counting on you to give them peace and order. They are ready to help and cooperate with you. And I am also promising you: you respond to whatever is within your jurisdiction and what is not, like local government officials who are only seen during elections, report them to me, I will deal with them. Like the corrupt members of various agencies, let me answer to that too. We will build a bigger (New) Bilibid (Prison), the plan is nearing completion," Aquino said.
The President said he had an open forum with the new graduates of the Philippine Military Academy (PMA) in Baguio City and he was happy that they spoke with him candidly.
Aquino said he was expecting Oban to continue the reforms initiated by his predecessor, retiring AFP chief Gen. Ricardo David.
He cited the achievements of Oban when he was Air Force commander and expressed full trust and confidence in him.
"He helped solve the problems there (insurgency in Pampanga). Because of his achievements, his reforms while being deputy chief of staff, I hope that he will continue the policies in the military as well as the programs left by Gen. David. That is the reason why I chose him as the new chief of staff," Aquino said.
He thanked David for helping him spearhead reforms in government, noting that his first instruction was to bring back dignity to the armed services.
"My first assignment (for David) was to bring back the trust of the people in the Armed Forces, just like what happened after EDSA (People Power revolution in 1986). Now, 10 years after a corrupt government, help me bring back dignity to the Armed Forces, and an AFP that also takes care of the people," he said.
He told the soldiers that the people were expecting a lot from them in ensuring peace and stability in the country. He encouraged military personnel to join him in taking the right path.
Aquino said he inherited many problems, including big debts of some agencies like the National Food Authority, but that his administration was making headway in implementing reforms in the country.
To help the soldiers and their families, the President said his administration was studying the possibility of giving scholarships to a member of every soldier's family and supporting their education up to college.
He earlier announced that 20,000 housing units would be ready for the soldiers and police this year so they would no longer be renting or living as informal settlers.
Sources said the President would appoint retired AFP chief David as commissioner of the Bureau of Immigration (BI).
The source said David would soon replace Ronaldo Ledesma, who was appointed officer-in-charge of the BI last July 28.
"The post was offered to him (David) two weeks ago. I think he has accepted the position. He may start next week," the source told The STAR.
Oban: We shall overcome
Oban vowed to intensify reforms to enable the military to overcome the stigma of corruption and abuses.
In his assumption speech, Oban vowed to improve the military's financial and procurement systems and to promote a culture that discourages corruption.
"We shall remove two basic conditions that breed corruption – opportunity and motivation – by further strengthening our systems and procedures that shall ensure accountability of every personnel and by promoting a culture that will encourage every soldier not to tolerate corrupt practices," Oban said.
"We shall overcome by discouraging material gain as a measure of success and encouraging a simple and healthy lifestyle. Yes, we shall overcome," he added.
Oban, a member of PMA class '79, said he would closely monitor the use of funds for United Nations peacekeepers and Balikatan exercises to ensure that these are not misused.
Oban said he would implement unannounced audits frequently to boost checks and balances in the military. – With Alexis Romero, Jaime Laude, Evelyn Macairan, AP
NOY ADMIN'S PCGG AUDIT BARES NEW ANOMALIES PHILIPPINE STAR By Rainier Allan Ronda
MANILA -The government is estimated to have lost billions of pesos because of a move by the previous leadership of the Presidential Commission on Good Government (PCGG) to convert its shares in San Miguel Corp. (SMC) from common to preferred shares in late 2009.
The SMC stake conversion, involving 753,848,312 previously common shares bought from coconut levy funds, is one of the many anomalous and highly disadvantageous transactions undertaken by the PCGG under its former chairman Camilo Sabio, now being probed by the commission under its current chairman, Andres Bautista.
In an audit report conducted by the Bautista-led PCGG, the SMC stake conversion was found to be an ill advised move especially in light of the recent upsurge in the stock price of SMC shares.
"The determination that the conversion was advantageous to the national government on a purely financial standpoint has, in the light of subsequent events, proven to be mistaken," the audit report said.
The SMC offer for conversion which was taken up in this case provided that "the SMC common shares shall be converted at an exchange ratio of one SMC series 1 preferred share for every one SMC common share tendered; each SMC series 1 preferred share shall have a par value of P5 per share and an issue price of P75 per share. The average market value prevailing at that time was approximately P66 per share. As of Nov. 30, 2010, the value of said common share is pegged at P120," the audit report said.
As of last Friday, shares of SMC at the Philippine Stock Exchange closed at P171.50. It hit a high of P189 last December.
If the 753.8 million shares are sold at the prevailing market price of P171.50, the share sale would fetch as much as P129.2 billion.
With the conversion of the SMC shares into preferred shares, the SMC can redeem the preferred shares at P75 anytime it wants, with holders of the preferred shares getting only an assured eight percent dividends in exchange for converting their shares.
"Based on the description of the exchange offer found in SMC's disclosure statement relating to the offer, it is SMC which has the option to redeem the SMCP1 shares," the PCGG audit report noted.
Moreover, the enumerated "risk factors and other considerations" in the disclosure provide that there is no stated maturity date and SMC has the sole right to redemption, report further said.
It noted the terms of the exchange offer which stated: "As and if declared by the Board, [SMC] may redeem the series 1 preferred shares on the third anniversary from the issue date or on any dividend payment date thereafter, in whole or in part, at a redemption price equal to the issue price of the series 1 preferred shares plus accrued and unpaid dividends, whether declared or undeclared, for all dividend periods up to date of actual redemption by [SMC]. The redeemed series 1 preferred shares shall not be considered retired and may be reissued by [SMC] at a price to be determined by the board."
Based on the terms of the conversion, the redemption price for the shares is "locked in" at the redemption price of P75, which means that the 753.8 million shares can be redeemed, at the choosing or "option" of SMC at a set P75 or P56,538,623,400.
The Sabio-led PCGG had invoked the fact that the conversion had been approved by no less than the Supreme Court.
In a decision issued by the SC on Sept. 17, 2009, the High Tribunal granted the government's motion seeking the conversion of the 24 percent sequestered common shares of SMC—registered in the names of Coconut Industry Investment Fund (CIIF) and its holding companies—into series 1 preferred shares.
In a 33-page decision penned by Associate Justice Presbitero Velasco Jr., the court held that the conversion "is advantageous to the public interest or will result in clear and material benefit to the eventually declared stock owners, be they the coconut farmers or the government itself."
"Respondent Republic, thru the PCGG [Presidential Commission on Good Government], is hereby directed to cause the CIIF companies, including their respective directors, officers, employees, agents and all other persons acting in their behalf, to perform such acts and execute such documents as required to effectuate the conversion of the common shares into SMC series 1 preferred shares, within 10 days from receipt of this resolution," the SC ordered.
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