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GRANT PROGRAM LEAKS Senator Sherwin Gatchalian says P937 million in subsidies went to “non-underserved” consumers in 2018 alone due to leaks in the vital energy rate program intended only for the poor. The leaks have been there for 20 years, he says. —LYN RILLON / SENATE PHOTO
MANILA, Philippines – Owners of rarely occupied vacation homes and apartments in residential towers were among those who got discounted electricity rates for the poor or so-called basic consumers, according to Senator Sherwin “Win” Gatchalian.
Gatchalian has introduced a bill that would extend by 20 years the basic rate or subsidized electricity rates given to low-income consumers who cannot afford the full cost.
But he said officials must first find ways to plug the leaks that allow what he called non-marginalized consumers to benefit from the program.
Loaded by the middle class
By his own calculations, Gatchalian said that roughly P937 million in subsidies went to non-underserved consumers in 2018 alone.
The subsidized rate is awarded to customers whose energy consumption is 100 kilowatt-hours or less per month, as prescribed by the Electric Power Industry Reform Act of 2001.
The subsidy is provided by other clients, including advanced users from the middle and lower middle classes.
But since the discount is based on electricity consumption, owners of rest homes and apartments in tall buildings that are occupied only a few times a year also get the discount, since their energy use is low, Gatchalian said.
Uncapped leaks
He showed a copy of the energy bill of the owner of an apartment that received a P16 subsidy after the owner moved into the family home during the closing. Comparing the incidence of poverty in the country and the number of consumers who received the subsidized rates, he said that around P937 million in subsidies went to non-marginalized consumers in 2018.
“The intention is good, the senators support it, but there is [leaks] that have been detected over the years. It amazes me that even after 20 years, [have] no [plugged] these [leaks]Gatchalian said at a hearing. It is “discouraging” that the government is not carrying out any validation process and that the amounts allocated to help do not always go to the intended beneficiaries, he added.
Poverty Level Exam
Gatchalian asked the Energy Regulatory Commission (ERC) and the Department of Energy (DOE) to conduct a comprehensive study and develop a strategy to plug the leaks.
Alvin Ortega, head of ERC’s Tariffs and Tariffs Division, said ERC would try to link its data on lifeline users with those of the Department of Social Welfare and Development on the poor.
DOE Director Mario Marasigan proposed that a consumer poverty level assessment be conducted.
Authorities could verify whether consumers are residents of resettlement or poor urban areas, for example, Marasigan said.
Cash grant program
If they live in condos, they shouldn’t be eligible for basic allowances, he said.
Apartment buildings, or residential towers, are called condominiums in the Philippines. The apartments in those buildings are locally called units.
The head of the National Electrification Administration, Edgardo Masongsong, said that the living allowance should be included in the government’s cash grant program for the poor, or in the 4P program, rather than being borne by “non-habitual” consumers.
Masongsong said that extending the life line can be a burden for working-class clients who bear the subsidy.
The government should assume the subsidy
Victorio Dimagiba of Laban Konsyumer Inc. said the leaks were the result of inefficiency and mismanagement by regulators.
Dimagiba also said that the government should be the one to assume the subsidy and not the consumers of the middle and lower middle classes.
Since helping lifeline consumers was a government policy, “[the] the government must lead by example, ”he said.
Since it is the other consumers who bear the subsidy, the ERC does not keep a close eye on it, Dimagiba said.
But it would surely cover the leaks if the subsidy were withdrawn from the government, he added.
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