Reports that Efraim Genuino, the chairman of the Philippines’ gaming operator-cum-regulator Pagcor, has been given a new mandate by the country’s political leadership may be premature.
As usual in the Philippines it’s all as clear as a muddy stream. The upshot however is that Dr Genuino will reportedly have to wait until after the country’s presidential election on 10th May to find out if he will be asked to stay on.
The protocol normally is that the job of Pagcor chairman is in the gift of the country’s president. There are however precedents for an incumbent Pagcor chairman to be kept on by an incoming presidential administration. It looked like Dr Genuino was going to fall into that happy band of reappointed bosses after politicians in the country’s lower and upper legislatures sponsored no less than three separate bills to put him back in the hot seat before the poll date.
Unfortunately for Dr G. the initiative appears to have run out of legislative time. A consolidating fourth bill (i.e., one drawing together the elements of the other three) was suppose to have been passed on the final full day of Senate business last week before the house was suspended for the election campaign. Due to the absence of 13 senators (an unlucky number as far as Dr G. is concerned) the Senate did not have a quorum (the minimum number of members needed to pass a bill). Senate business has now been suspended until 31st May (three weeks after the election). Senate president Juan Ponce Enrile says the appointment will now be up to the incoming president.
The political sensitivity of the Pagcor top job is apparent from some of the comment seen in the country’s media. At the beginning of last week a political column in the Inquirer newspaper stated: “Denying the next president a Pagcor appointment would have immense political value for Genuino and his patroness, President Macapagal-Arroyo.”
President Arroyo is not seeking re-election. So why would denying the country’s next president the right to appoint the head of Pagcor be a ‘coup’ for the incumbent chief executive? Arguably it would help her in any future campaign for re-election or at least help her political friends and would-be successors.
Pagcor–the Philippine Amusement and Gaming Corporation–acts as a tax collector in its own right on all gross gaming revenues raised both by its own casinos and by those owned or part owned by foreign investors (such as Genting Hong Kong at Resorts World Manila). That’s not counting ‘supplementary’ taxes occasionally imposed on gaming operators seemingly on an ad hoc basis.
Tax raising power wouldn’t in itself be enough to confer a political advantage to whichever political party appointed the boss of Pagcor were it not for another factor. Opposition politicians claim Pagcor under President Arroyo has become politicised and partisan to an extent incompatible with its role as a government corporation. Pagcor is said to be the only government department reporting direct to the Office of the President, and has in the past gone over the head of the country’s public spending watchdog–the Commission on Audit (CoA)–to appeal direct to the nation’s chief executive against demands to cough up allegedly overdue tax revenues.
Even if it’s the case that Pagcor has become politicised, it would be naïve to assume that opposition candidates wouldn’t seek to do something similar with the body were one of them to assume power, including the appointment of a chairman seen as “their” man (or woman). Transparency International, an organisation monitoring standards of governance around the world, ranked the Philippines 139th out of 180 countries in its Corruption Perceptions Index 2009–just behind Pakistan and slightly ahead of Azerbaijan (the smaller the ranking number the better managed the country or jurisdiction). For the record Singapore is ranked 3rd, and Macau is in 43rd spot.
Two senate bills proposing Dr Genuino’s reappointment were filed two days apart with identical explanatory notes emphasising the need for continuity of leadership in the light of the much vaunted Manila Bay gaming resort project.
The notes stated the purpose of the bills thus: “To maintain the trust and confidence of the investors and to ensure continuity in the [Entertainment City] project which already started [sic], the need to fix the terms of office of the members of Pagcor Board of Directors, its Chairman and Chief Executive Officer, and President and Chief Operating Officer becomes imperative [sic]. Pagcor’s vision to be a catalyst for economic growth and national development will gain headway if there is continuity in its thrusts [sic] and programs.”
As if that wasn’t enough paperwork flying around the corridors of government regarding Dr Genuino’s possible reappointment, these two bills were then merged to form Senate Bill 3575 on 1st February.
AGI has had a look at the provisions of that ill-fated consolidated bill.
It stated that the Pagcor chairman should be appointed for a fixed term of six years with the option of reappointment for a further six years. It added no individual should be reappointed more than once.
Interestingly the bill also proposed that in future two of Pagcor’s five directors should be from the private sector. This could be a political trade off related to earlier suggestions that Pagcor might be ‘privatised’.
Of Pagcor’s current board, only one director, Philip G. Lo is from the private sector. He’s a director of the Hyatt Hotel & Casino Manila (where Pagcor has a gaming operation). The other current Pagcor directors include a retired army general, a former governor of Lanao del Norte province, and the head of finance and administration in one of the executive bodies of the Office of the President.
Whether the idea of full-blooded ‘privatisation’ for Pagcor will be a live issue under the new president remains to be seen.
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