SKYROCKETING OIL PRICES FUEL DISCONTENT: PUBLIC OUTCRY HEIGHTENING
MANILA, APRIL 14, 2011 (TRIBUNE) By Benjamin B. Pulta and Angie M. Rosales - Noise barrage and massive protest actions, which used to be the pursuit of President Aquino and his allies to gain attention, will now be trained on Aquino himself and the mass actions are expected to build up until Labor Day on May 1 when a massive rally is planned to protest the series of oil price increases and the band-aid solutions his administration had applied on them.
Public outcry against skyrocketing oil prices grew louder yesterday after oil companies raised pump prices by another P1.50 per liter marking the 12th time this year that fuel prices were raised.
The Department of Justice (DoJ) tried to perform a fireman's job to cool down discontent after Justice Secretary Leila de Lima (photo) said her agency will investigate the possible collusion between petroleum corporations that resulted in successive oil price hikes.
"There is a Department of Energy (DoE) — DoJ Task Force and both agencies need to convene for this oil price issue. Independently, I have sent an urgent memorandum to the Office of the President for the establishment of a DoJ Office for Competition to address cartels and restrictive agreements," De Lima said.
Nonetheless, even Aquino's close ally Sen. Ralph Recto questioned the Palace's claims on limited governments funds in implementing its fuel subsidy policy currently covering only drivers and operators of public utility vehicles in Metro Manila as a result huge windfalls the government is generating from the rising prices of fuel.
Recto said there's more than enough resources to sustain the program now being called to cover fishermen and farmers.
"How did they arrive at that?" he asked, during an interview with reporters, referring to the P450 million funds for the initial implementation of fuel subsidy intended for jeepney and tricycle drivers and operators.
Recto, who happens to be the "brains" behind the fuel subsidy program, pointed out that the government earns more from value-added tax (VAT) as oil price increases.
Recto cited estimates putting the government's windfall from oil VAT at P1.56 million a day every time the crude prices move up by $1 per liter from a daily consumption of 300,000 oil barrels, he said.
"In 20 days, that would mean P600 million. Why (allocate) only P450 million when you can do more? That's a windfall profit (of a million pesos) a day," he said.
Estimates this year, Recto said, would show that government could afford P9 billion in subsidy.
"It's logical and reasonable, based on the P45 billion VAT collected on petroleum by government in 2010, which is forecast to grow by at least five percent this year. So if the original peg price of crude oil is $90 per barrel, but is now $110 per barrel or an increase of $20, the government therefore, expects to grow its VAT oil by another P9 billion this year," he explained.
"So anything in excess of the P45 billion that will be collected this year, that's windfall profit and it should be allocated for the (fuel) subsidy," he added.
Recto also questioned the manner in which the policy is being implemented through the issuance of cards which would only entail so-called "administration cost."How much would that cost us? Why don't they just ask the oil companies to engage in a system where there will be a dedicated lane for PUVs? That way, it can cover the entire Philippines, not just Metro Manila. This EO (executive order) covers only Metro Manila. I just hope they study more this matter," he said.
Civic groups said the effects of Aquino's subsidy scheme have been "nullified even before it was implemented."
Anakbayan national chairman Vencer Crisostomo said the subsidy, amounting to P1.16 per liter was offset by the recent pump price increases of P1.50 per liter for diesel, and P1.25 for gasoline. "The subsidy program, which the government claims will be implemented in two weeks, will run for only one month," he said.
"Obviously, the program was not meant to reduce the effects of the hikes on the public, only the effect on Noynoy's survey ratings" said the youth leader, in reference to the recent surveys which have shown a huge drop in the president's popularity.
Crisostomo called the hike 'vindication' of Anakbayan's call for imposing controls on the price of petroleum products, as well as a 'significant' wage hike for workers in both the private and public sectors.
Government employees under the Confederation for Unity, Recognition and Advancement of Government Employees (Courage ) also held a protest action in front of the National Housing Authority yesterday to express outrage over the rising fuel prices.
Courage national president Ferdinand Gaite slammed the price hike, saying "Government employees, like the majority of the Filipino people can no longer cope with the rising prices of commodities and services."
"Noynoy's obvious apathy to the legitimate demands of the labor sector is deplorable. Instead of pushing for band-aid solutions like paltry subsidies available only to selected sectors, Noynoy should immediately implement a substantial wage increase for both the public and private sector in order to provide immediate economic relief to the workers and employees reeling from the unabated price hikes, " Gaite asserted.
Various groups are calling for a Metro-wide noise barrage on tomorrow at 4 pm and a May 1 protest action dubbed "Workers' and People's Day of Outrage".
Ang Galing Pinoy Rep. Juan Miguel "Mikey" Arroyo also joined the swelling ranks of lawmakers demanding for the suspension of the valued added tax on oil products saying Aquino's proposed subsidy for the transportation and agricultural sectors, while laudable, failed to ease, if not totally failed the impact of continuing increase of the price of petroleum products.
In a text message, Arroyo, who chaired the House committee on energy during the 14th Congress, called on Aquino to sacrifice a bit for the people by suspending the collection of the VAT on oil as his very purpose of easing the impact of "almost daily round" of oil price increase, had been defeated by the unabated oil price hike, the latest of which was the biggest hike in prices of petroleum products in years Tuesday.
"I call on President Aquino to suspend immediately the (collection) of VAT on oil at least for the time the nation is besieged with an almost daily round of oil price hike and until such time the world price of crude (oil) products normalize," said Arroyo.
Arroyo stressed that while Aquino's idea of fuel subsidy could be laudable, it had been proven to be short of its projected effect as the amount of fuel subsidy palews in comparison with that of the amount of the latest oil price hike.
The solon also justified his call for the suspension of the VAT on oil saying that suspending collection of the controversial tax on oil temporarily will not "cripple the government's" financial standing as it had already collected more than P4 billion in windfall profit and projects a total of P28 billion in windfall profit this year in oil products alone.
Secretary Ramon Carandang of the Presidential Communications Group said the government believes there are still other solutions available to solve this particular problem without invoking the so-called emergency powers.
Carandang was reacting to the statements made by House Speaker Feliciano Belmonte who was quoted by reporters the other day saying that the legislature will seriously consider a proposal granting the President extra authority if necessary to address the supposed impending fuel crisis.
Carandang said it's up to the House leadership to explain why they came up with such idea in the first place as he implied that the government right now has enough capacity to address the impact of the Middle East crisis to the oil industry in the country.
On the issue of fuel subsidy, Carandang said Malacañang could not guarantee whether its Public Transport Assistance Program (PTAP) which is about to be implemented next month could be expanded to cover some groups of farmers and fishermen.
Carandang implied that nothing was conclusive, insofar as Agriculture Secretary Proceso Alcala's pronouncement at a Malacañang news conference the other day is concerned, given the limited budget that was allotted by the government in its fuel assistance program.
The Palace official said Energy Secretary Jose Rene Almendras and the other economic managers are still studying Alcala's proposal on the possible inclusion of a select group of farmers and fishermen in the PTAP and whether the government could still afford to fund the program's expansion.
The government has allocated about P450-million for the PTAP covering the public transport sector alone and Carandang conveyed that such fund has to be increased to accommodate groups representing the agriculture sector. Aytch S. de la Cruz, Charlie V. Manalo
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