Drilon seeks to amend BSP charter, bats for P200-B capitalization

MANILA-Senate President Franklin M. Drilon has filed Senate Bill No. 1865 which seeks to enable the Bangko Sentral ng Pilipinas (BSP) to effectively respond to the challenges and innovations of a globalized economy by increasing its capitalization to P200 billion, among others. 

 “We have to support BSP in its constitutional mandate of ensuring a competitive, robust and inclusive economy. This additional capitalization and other amendments to the current charter will enhance its capability to perform its roles in protecting the savings of depositors, ensuring the smooth flow of transactions in the financial market, and enhancing the corporate viability of the BSP,” said Drilon.

Drilon pointed out that an empowered BSP fosters a financial system that delivers a high quality of life for Filipinos.

“There is, undoubtedly, a need to respond to contemporary challenges by amending the BSP charter in order that it remains effective in providing policy directions in the areas of money, banking and credit as well as in supervising entities within the financial system,” the Senate chief added.

The capitalization being proposed, he noted, is four times higher than the P50 million provided in the current BSP charter. The P150 million in additional capitalization shall be paid by the government in three consecutive annual installments.

“The amendments will focus mainly on areas that would enhance BSP’s capability in fulfilling its primary objective of maintaining price stability conducive to a balanced and sustainable growth of the economy,” said Drilon.

“Aside from the additional capital build-up, the proposed new charter will expand the BSP’s regulatory function to include credit card companies, money changers, e-money issuers, remittance agents, payments and settlement system operators,” noted Drilon.

“The Bangko Sentral shall oversee the payments and settlements system in the Philippines in accordance with sound and prudent practice,” according to the bill.

“The Bangko Sentral shall also have the power to obtain information for supervisory purposes on transactions between a supervised institution and a parent or other affiliate companies, and the authority to look into the main activities of companies affiliated with the parent companies that have a material impact on the safety and soundness of the bank and the banking group,” the bill added.

The bill further seeks to strengthen the BSP’s monetary stability function by restoring its authority to issue negotiable certificates of indebtedness even during normal times, a power granted to the old Central Bank of the Philippines, but was not included in the current BSP charter.

The bill also aims at strengthening BSP’s financial stability function by enhancing BSP’s supervisory authority and providing legal protection for BSP officials when performing official duties.

Lastly, the bill proposed to exempt the BSP from all types of taxes. 

Legarda Reiterates Need to Ensure Integrity of Structures to Withstand Earthquakes

MANILA-In light of the recent magnitude 7.2 earthquake in the Visayas area, Senator Loren Legarda today reiterated her call for the immediate evaluation of the structural integrity of critical structures in the country.

According to a report from the National Disaster Risk Reduction and Management Council (NDRRMC), the earthquake that was greatly felt in Bohol and Cebu has caused the death of at least 156 people, affected more than three million citizens, and damaged structures including 2,000 houses, 20 bridges, four roads, and several heritage churches, hospitals, public buildings and private establishments.

“We cannot predict when an earthquake will occur, therefore, we must always be prepared. The best protection against earthquakes is sound engineering practice. With this earthquake that damaged many structures particularly in Bohol and Cebu, it is a must that we immediately revisit our construction standards, codes and practices.  We must examine them now and correct any deficiencies,” said Legarda, the UN Champion for Disaster Risk Reduction and Climate Change Adaptation for Asia-Pacific.

The Senator said that the evaluation and retrofitting of infrastructure in the country, especially hospitals, schools and bridges, must be done regularly to ensure that they can withstand strong earthquakes.

“We must ensure the safety of our schools and hospitals. We were fortunate enough that the earthquake happened on a holiday, otherwise, many children would have been in their schools. Meanwhile, there were hospitals that suffered major damage due to the temblor,” Legarda said. 

She noted that a guidebook on the promotion of disaster mitigation, which was published by the World Health Organization (WHO) and the Pan American Health Organization (PAHO), revealed that the cost of disaster-proofing a hospital or health facility by incorporating comprehensive disaster protection from earthquake and extreme climatic events into designs from the beginning will only add 4% to the cost of construction.

“This cost is nothing compared to the risk of destruction and death of patients and staff during a disaster, and the equally high health, economic and development impacts in the aftermath,” Legarda explained.

“School and hospital authorities must act now. They must consult structural engineers and assess the vulnerability of school and hospital structures to strong earthquakes, and institute immediate measures to strengthen parts found weak and likely to collapse. We should likewise ensure that our homes and offices, shopping malls and public buildings, and heritage sites are able to withstand strong earthquakes. We must ensure proper and safe construction. This lesson we must accept: Prevention is cost-effective,” she concluded.

Transform PDAF into ‘Priority Disaster Assistance Fund’

MANILA-It is perhaps time to thaw the frozen pork and use it to help victims of the Visayas earthquake, Typhoon Santi and the siege of Zamboanga.  

Withheld PDAF can be converted into a Priority Disaster Assistance Fund.

To effect the release, the Senate can issue a resolution authorizing the executive branch to utilize the unreleased portion of the senators’ share from the Priority Development Assistance Fund for 2013 for the rehabilitation of areas hit by the three calamities.

I will leave it up to the lawyers in the chamber to perfect the legal language which would free the PDAF from judicial impoundment and at the same time allow executive agencies and local governments to use it to provide comfort and succor to those affected by the said calamities.

My point is that from the senators’ funds from PDAF alone, there is a substantial amount that can be tapped for disaster relief.

Ibig sabihin, meron perang nakatiwangwang para ‘itabang’ sa mga biktima ng kalamidad. Pork barrel can be pounded into new classrooms and roads.

The greater tragedy is to hold it in continuous embargo when it can be used to help farmers replant their fields, arson victims to rebuild their homes, and the intrepid Bol-anons and Cebuanos rebuild their towns.

If the old PDAF will be resurrected as Priority Disaster Assistance Fund, senators must have no say on how, where and when it shall be spent, except to remind agencies to disburse it according to procurement and auditing rules.

Above all, it must be spent fast, as the need for assistance is urgent, but in a manner that is transparent. In short, the process can be sped up without circumventing the rules.  

Personally, I believe that local governments are in the best position to spend relief funds and orchestrate rehabilitation work as they are familiar with the damage and the local resources that can be mobilized to repair them.