GSIS seeks full disclosure on Meralco deals, operation

05/02/2008

The head of the Government Service Insurance System (GSIS) said its four representatives in dominant electricity distributor Manila Electric Co. (Meralco) is receiving dirt-rag treatment and the state pension fund is now demanding full accountability in the power firm’s operations.

GSIS president and general manager Winston Garcia said he will demand full transparency and accountability in the operation and transactions entered into by Meralco.

GSIS holds four seats in the utility’s 11-member board and Garcia said the GSIS is fed up with the lack of transparency prevailing at Meralco.

Garcia issued the statement yesterday in the runup to the May 27 annual meeting of the power company.

Garcia categorically denied that GSIS is out to wrest control of Meralco, either for itself or for the Philippine government, explaining that the latter has a long-standing privatization policy.

“Claims of takeover are utterly false and malicious, and are obviously intended to undermine and divert attention away from the GSIS campaign to bring back social responsibility and good corporate governance to Meralco,” Garcia said.

He pointed out that the GSIS is not the Philippine government despite its being government-owned. “Clearly, the bogeyman being raised by GSIS critics is nothing more than squid tactic to preserve the appalling status quo at Meralco,” he said.

As a utility, Meralco’s operation is imbued with public interest, aside from the interest of its shareholders like GSIS, said Garcia. He added that despite repeated requests for access to corporate documents, the people lording it over at Meralco have turned a deaf ear toward the GSIS.

“If Meralco’s management can get away with bloody murder against its very shareholders, what more when it comes to the general public and its customers, who, ultimately, pay the high price of unjustifiably high electricity bills due to corporate mismanagement and shenanigans,” said Garcia.

“For the record, what we have at Meralco is the very same management who twice over has been found by the Supreme Court to be overcharging Meralco’s customers, including GSIS members,” he said.

“Yes, the Supreme Court ordered Meralco to refund its customers.

“Nonetheless, I believe its management would not have undertaken the refund if it had not been caught by the Supreme Court charging its customers excessively, thereby in effect stealing from the poor.”

He said the overcharging was just the “tip of the iceberg.” Garcia cited as “another instance of corporate mischief” Meralco’s acquisition of an insurance company from whom it bought insurance coverage under dubious circumstances.

“This insurance company has reinsured Meralco with a Bahamas-based insurance firm which in turn, reinsured the same to another Philippine-based insurance company,” he said.

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