Government News Analysis

PCGG – under the axe

Presidential Commission on Good Government (PCGG)

The Presidential Commission on Good Government (PCGG) is finally being wound up. The House of Representatives’ Justice Committee gave the thumbs up to abolish it on Wednesday. Good riddance – if there was ever a misnomer this is it. Riddled with corruption virtually from its inception, the PCGG is everything it claims to be against. It recovered ill-gotten wealth with one hand and pocketed it elsewhere with the other.

In fact, the only people who’ll miss the commission are the families of alleged human-rights victims from the martial-law years of former president Ferdinand E. Marcos (photo, left) who live in the frail hope of receiving compensation from the government, and those who’ve used it to generate personal income. No doubt there have been good men and women who’ve worked there over the years, but – plagued by corruption – it’s long been unfit for purpose.

That purpose was to recover the estimated US$10 billion allegedly purloined by Marcos from the public purse. The commission was set up by his successor, Corazon Aquino (photo, right) – in fact, it was the very first act of her administration. But 30 years later, only around one third of the money has been recovered – actually, US$3.4 billion, and most of that was years ago – while other large sums of cash and assets remain locked up in stalled litigation.

Under the wind-up proposals, those cases will be handed over to the Office of the Solicitor General (OSG), which to a large extent handles them anyway. The PCGG’s main function is as an administrator – something which, according to then Presidential Spokesperson, Ernesto Abella, can easily be handled by the OSG.

The trail for new leads, however, has gone cold and the high-sounding Presidential Commission on Good Government finds itself surplus to requirement under President Rodrigo Duterte’s efforts to tackle the bureaucracy’s obesity problems. “There is still fat in government that we must trim,” Duterte said in his 2017 Budget Message.

To this end he urged passage of the Rightsizing the National Government Act – legislation designed to simplify, rationalise, streamline or abolish departments and agencies in order to machete red tape and redundant programmes, eliminate functions-overlap and enhance public-services delivery. Congress has overwhelmingly endorsed the Act.

And well it did. Since the start of the millennium, 12 new agencies have been added to the bureaucracy bringing the total number of such units to 186, while the government wage bill has ballooned over that period in order to pay for an additional 500,000 staff. There are currently around 1.6 million employees in the public sector. This year, of government’s PHP3.35 trillion budget allocation, PHP990.5 billion will have gone to pay for ‘Personnel Services’. Staff wages, then, will account for almost 30% of the entire national budget.

Budget Secretary Benjamin Diokno who identified the commission as no longer necessary back in June said this: “I don’t think we need a PCGG at this time. There are many agencies, there are many task forces created in the last 30 years. So this gives us the opportunity to once and for all clean up the government”.

In the greater scheme of things, the PCGG’s annual allocation of around PHP112 million looks like chicken feed for its staff – some 94 lawyers, researchers and administrators who work out of a building in Mandaluyong City, Manila; a building once owned by the Marcoses. But it seems to have had alternative income streams.

The commission is mired in long-running allegations of gross corruption, and it’s illegal three-decades-long sequestration of the giant Philippine Overseas Telecommunications Corporation (POTC) and its subsidiary Philippine Communications Satellite Corp. (Philcomsat) was only finally lifted by the Supreme Court in March last year.

So serious was this abuse of power that the court backdated the lifting of the PCGG’s seizure of POTC assets by 30 years – a highly unusual move – prompting this from Philcomstat president and CEO, Lin Bildner: ”Now we will run after PCGG for their crimes, abuses, plunder, etc., on our companies from 1987 to today”.

This whole saga goes back to 14 March 1986, when the corporation was taken over following a directive issued by then PCGG commissioner, Ramon Diaz. From then on, POTC and Philcomsat effectively became the playground of PCGG functionaries who elected themselves as board directors, nominees and officers of the corporation and its subsidiary – availing themselves of fees and other emoluments and benefits. Disgraced former Commission on Elections chairman, Andres Bautista, during his stint as head of the PCGG, for example, was involved at board level in POTC.

Billions of pesos have allegedly been misappropriated by the commission’s nominees in the course of their involvement with these companies. This took place via a range of schemes including bogus land sales to Philcomsat brokered by a PCGG nominee; advances of loans – never repaid – the plunder of a subsidiary’s capital and payments supposedly made for public relations and legal services.

On top of all that, a former PCGG commissioner, Camilo Sabio, who ran the shop from 2005 to 2010, was found guilty of grave misconduct by the Office of the Ombudsman in 2012. Last June, he appeared before the Sandiganbayan First Division court which handed him a prison term of 12 to 20 years for improprieties dating back to 2007 and 2009. In September, he was arrested by the National Bureau of Investigation on charges of graft, malversation of funds and corrupt practices.

Not bad for a body whose terms of reference – in fact its entire being – requires it to investigate graft and corruption. The real root of the problem that created the climate for this state of affairs was the near-Draconian powers that were invested in the commission.

It had free rein over the investigations it conducted; it could sequester real estate, goods and records which it deemed relevant to its investigations; it could seize business enterprises for the same reasons; administer oaths and issue subpoenas. In short, it was a law unto itself with precious little oversight. The potential for corruption was fabulous and evidently irresistible.

Over the years there have been a number of proposals to axe the PCGG – some as a result of scandals; others calling its efficiency and effectiveness into question – but none of them were successful in getting sufficient support. Political will to see it through was invariably lacking

The PCGG always managed to dig its heels in and stubbornly stick around. On the occasion of the organisation’s 25th anniversary, Bautista, then the man in charge, while supporting a wind down of the commission’s Marcos-wealth-retrieval mandate, suggested the creation of a whole new entity – an ‘Institute for Good Governance’.

Here’s what he said: “After 25 years, we think the commission has done everything to fulfill its first mandate to return the Marcoses’ ill-gotten wealth. The matter is already in the court now and what we suggest is for the agency to focus more on its other mandates”.

Those other mandates are: first, “The investigation of such cases of graft and corruption as the President may assign to the Commission from time to time”. And secondly, “The adoption of safeguards to ensure that the above practices shall not be repeated in any manner under the new government, and the institution of adequate measures to prevent the occurrence of corruption”. Given the PCGG’s track record, it’s impossible to miss the irony in all that.

This time, however, it’s different; the political will is there. Furthermore, the two things Duterte has promised to do about government – both featured in his election campaign – are: (a) cut it down to size by removing the bureaucratic flab, and (b) cut out official corruption from right across the public sector from Manila to the provinces. The axing of the PCGG would seem to meet both criteria.

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