Angara joins calls for stoppage to hikes in power, fares, fees

Sen. Edgardo Angara yesterday joined colleagues who had already warned Malacañang of courting unrest, if the Executive will not reassess its plan unleashing a barrage of price adjustments in power, fees and fares to the overburdened consumers and commuters.

The lawmaker agreed with the contention of Sen. Ralph Recto who earlier had sounded off what he described as middle class revolt as they are the ones that would suffer the most in the simultaneous price increases.

“How big is our so-called middle class in the Philippines? It’s a vanishing breed, an endangered species. The economics definition of middle class is middle income. If those in the bottom, for example, make P30,000 a year, and those at the top make P100,000 on average, then the middle class should be making P50,000 to P60,000 a year and they receive their income regularly.

“This is why teachers and other professionals are generally classified as middle class and they can usually generate extra purchasing power. But can we really apply this definition to the Philippines? We’re removing the subsidy from the MRT-LRT (Metro Rail and Light Rail Transit) and imposing VAT (value-added tax) on toll — well, actually more on the LRT/MRT system since this is the vehicle of choice of the salaried.

“Those affected by the toll increase, I think, may be qualified as upper middle class because they already have their own vehicles. True middle class are those MRT-LRT riders.

“The issue here is the amount. This is very important because we cannot sustain such a low fare for the MRT and LRT. At only P14 while the equivalent bus ride is about double that. We simply cannot sustain this kind of disparity. But the problem is, these are hard times. Prices of basic commodities are on the rise. Fuel prices continue to increase. Even the cost of school is increasing, so the middle class is really squeezed. This is why I think that the issue surrounding the MRT-LRT fare hike is largely symbolic. If we take away the subsidy there, we are also reducing to some extent the squeezed income of the middle class. I think this is what Ralph (Recto) meant and I agree with him. But timing is also very important. Not now, when times are really bad,” Angara said.

Recto, in reiterating his call, said government should exhaust all possible sources of fresh revenues before turning its back on its promise not to impose new taxes and planned fare increases.

“The last thing you want to do is raise taxes. They should exhaust all efforts before insisting on the new and added fees,” Recto, Senate ways and means chairman and senior finance vice-chairman, said.

He said the government, through the National Power Corp. (Napocor) and the Power Sector Assets and Liabilities Management Corp. (PSALM), could defray the cost of raising power rates by charging it against the multibillion-peso Malampaya funds.

He said the fresh P25 billion collected yearly as share in the Malampaya gas project could be used to cover the cost of power rate hikes.

Recto said dividends remitted by government- owned and- controlled corporations (GOCCs) and proceeds from privatization could likewise plug the need to raise fares in the Metro Rail Transit-Light Rail Transit (MRT-LRT) elevated rail systems and bankroll key infrastructure projects.

He said the Bangko Sentral ng Pilipinas (BSP) alone could deliver P11 billion in dividends while state-run Development Bank of the Philippines (DBP) has P18 billion in retained earnings, which could be used to off-set increases in fees and charges of government agencies and the VAT on toll.

The senator earlier warned of a ‘multiple whammies’ if VAT is slapped on toll fees, while MRT-LRT fares, power rates and agency fees/charges are raised simultaneously as prices of consumer goods and fuel continue to rise and in the light of global economic downturn and growth downgrade of the country. –Angie M. Rosales, Daily Tribune