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Curse of an oligarch

"PECO has remained untouchable."

 

 

Rich families have always lorded over the country’s regional economy, as those with vast landholdings and businesses in the provinces dominate the local economy, usually with their huge agri-industrial businesses migrating to public services.

Such is the case for the Cacho family of Iloilo, the majority owner of the controversial utility firm Panay Electric Co. (PECO), which for 95 years monopolized electricity distribution in Iloilo City by virtue of a franchise from Congress. 

Because their business is a monopoly and a rich cash cow, the Cachos controlled regulatory oversight of their business by securing political connections with whoever was in City Hall or in the National Government’s regulatory arm.

This appears to be a reason why the Cachos and PECO remain untouchable, even with making bad corporate decisions like making an uninsured deposit of P819 million in Export and Industry Bank (EIB), a bank that was declared insolvent and closed by the Bangko Sentral ng Pilipinas in April 2012. The chances the uninsured deposit could still be recovered by PECO are very slim, according to auditors, because the closed bank’s assets are not even enough to pay off its primary insured creditors.

PECO was put up in 1923 by prominent Iloilo businessmen who acquired a new legislative franchise to distribute and sell electricity in Iloilo City. The gentlemen who put up PECO, however, sold the business four years to the matriarch of the Cacho clan, Dona Candelaria Soriano Cacho. Lola Candi, as she was known, gave management of the utility firm to her son Mariano, a civil engineer. 

Management has remained in the hands of the Cachos since then.

Like any monopoly, PECO has been known for a bad record of service to its customers, namely the residents of Iloilo City. This bad record, it seems, has been consistent because of its monopolistic nature. No competition except for government oversight, which can be managed by politicians that supervise the oversight function like those in City Hall and in Congress, tend to give business owners a God-like complex, more so in a city far away from the seat of the National Government. 

In such cases, it’s the customer that suffers as services become sloppy. If you don’t like the service, you complain, and if there is no action or the action takes a long time and cost you more suffering, you have no option because the service, in this case electricity for the household or the business, is something you cannot just give up because of disgust.

PECO is one such monopoly, and it appears the Cachos are a prime example of the bad things that oligarchy represents for Filipino consumers.

Look at its litany of sins that made electricity service in Iloilo a token.

First, it did not have enough capital expenditure to modernize its distribution facilities that resulted in undersized and crowded feeders, leaning poles, disorganized service drops, unsafe clearances of lines and substations from vegetation, unsafe clearances of lines from structures, leaking substations and transformers. Its distribution charges appear to be low because it has not submitted any CAPEX program to the Energy Regulatory Commission to modernize its facilities.

PECO has also chosen to continuously declare dividends to its stockholders despite complaints of overbilling and bad service from Iloilo residents. First Philippine Holdings disclosed to the Philippine Stock Exchange that PECO declared dividends amounting  to P41 million in 2015, P43 million in 2016 and P51 million for its 30 percent shareholdings in the Iloilo utility firm.

In a display of vanity usually displayed by oligarchs that run monopolies, PECO chose to build a new P65-million head office building with a private elevator and accommodations for its senior executives instead of investing in the improvement of its distribution facilities.

Now, PECO faces a big quandary as its control of electricity distribution in Iloilo is certain to end with its losing its bid to secure a new 25-year legislative franchise from Congress to replace its current franchise that expires on January 18, 2019.

Congress is always blamed  for perpetuating oligarchs’ control over the local economy to the detriment of the voting public. In denying PECO a new franchise, Congress has redeemed itself for the hapless citizens  of Iloilo City. 

* * *

All roads lead to Conspiracy.

After three decades, Buklod is back —all three of them.

In the 1980s, when rallies literally filled the streets, a group of Filipino musicians which included Noel Cabangon, Rom Dongeto of Sinaglahi and Rene Boncocan of Lingkod Sining, banded together to form Buklod, which stands for Bukluran ng mga Musikero para sa Bayan. Collectively, they formed the forefront of a united cultural workers heavily committed in pursuing a truly democratic society.

However, the EDSA people’s uprising in 1986, many people, including the musicians who were previously involved in Buklod, became complacent, falling into a trap of false notion of an achieved victory. But not with those truly committed to the advancement of the people’s struggle for a truly democratic and prosperous Philippines.

It was then the trio of Cabangon, Dongeto and Boncocan decided to pursue the advancement of people’s music they have since advocated and took on Buklod as their band name. They released their first album, “Bukid at Buhay” in 1987, a collection of songs they had written. Heavy on the acoustics, the album, which also featured the late Susan Fernandez-Magno, centered on the lives, struggles ad aspirations of the Filipino peasants.

After the release of their first album, Boncocan left the group to pursue other interests.

In 1991, Buklod, then consisting of the duo of Cabangon and Dongeto, released their second album, “Tatsulok,” a human rights-themed collection, the angst against human rights abuses effectively epitomized by the power licks and thunderous beats from guest musicians. The carrier single, incidentally, the name of the album, was later re-released by pop rock band, Bamboo.

In 1995, Buklod again released another album, “Kandungan sa Kalikasan,” dedicated to the environment. The album spawned the iconic hit, “Kanlungan,” an environmental love song which was also adopted by a leading fastfood chain in one of its advertisement.

Except for the airing of Tatsulok, the Bamboo-version on radio, and the television commercial of the fastfood chain featuring the song, Kanlungan, there was nothing more heard of Buklod again as the band took a 22-year break. As Cabangon continues to chase his music career, Dongeto and Boncocan had to pursue paths veering away from the music scene, the former ending up as executive director of the Philippine Legislators’ Committee on Population Development, and the latter, a successful art director in a prestigious advertising agency. 

Until 2017, when the trio of Cabangon, Dongeto and Boncocan regrouped and was spotted performing again in mass rallies. With the political scenario hardly changing when they were first introduced to the harsh social realities, their penchant for writing and performing politically-themed songs were revitalized, as if receiving a booster shot in the arm.

Thus, three decades after they first stepped and performed in a the stage of a political event, Buklod will now release another album amid calls for change in their songs remain as relevant as ever.

Catch them tonight at Conspiracy Garden Café at 9:00 p.m.

Topics: Charlie V. Manalo , Curse of an oligarch , Panay Electric Co. , PECO , Cacho family , Iloilo City
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