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Meralco customers are better off with the devil they know
AS I WRECK THIS CHAIR By William M. Esposo
The Philippine Star 2008-05-13
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Power consumers are trapped between the greed of two parties fighting over Meralco. The Arroyo regime is obviously bent on wresting management control of the country’s biggest electric utility company from the Lopezes.
Of course, the Lopezes’ ownership of practically every major public utility is an issue in itself. When the family ventured into water distribution, someone commented that water and electricity were a deadly combination. It did not take long before the Lopezes found themselves ‘electrocuted’ from their unsuccessful venture in running their water distribution company, Maynilad.
But then again, we have no law prohibiting anyone who is qualified to venture into lucrative businesses as long as this does not violate anti-trust laws and fair trade practices. The Lopezes did take risks as much as they took losses.
The battle royale will find resolution at the end of the month during the annual Meralco Stockholders Meeting where independent shareholders who account for 33.6% of Meralco common shares will vote their decision. Government and its allied institutions hold 33.0% while the Lopez family controls the balance of 33.4%.
I used to own shares of Meralco during the 1990s. If I still owned those shares today, I would be voting to retain the Lopezes as managers of the company. It will not even be a hard decision to make.
Government’s miserably disastrous track record for management speaks for itself. IBC-13 was a top rating TV network until government ran it. Government assisted previously ailing companies PASAR, the National Steel Corporation and the Napocor from sickness to terminal stage. In fact Napocor’s inefficiency is largely responsible for the high cost of Meralco electricity.
We may have our beef with Meralco, but a government takeover will most certainly take us all back to the dark ages, pun intended.
Meralco’s worst performance was between 1972 and 1986, when the Marcos regime took over the utility firm. Do we want to experience those brownouts again? I shudder to even imagine what it will be like to have power outages in this age of computers, technology gismos, MRT and LRT, malls and worse, when global warming has made air-conditioning a survival tool.
I would have no problem considering a change of management if the alternative will be having a truly qualified and professional management team. It makes sense to inject new blood to a company that has been unable to meet consumers demand for a better, cheaper service. A new management team can inject new approaches that could work.
When viewed in the right perspective, our complaints against Meralco may be valid, but we cannot conclude that the power firm is badly managed. In fact, Meralco performed quite creditably in restoring power during those times when typhoons caused massive power outages.
Now imagine having government operating Meralco and dealing with metro-wide power outages. If they cannot even get their act together in handling the rice crisis, which affects mostly lower income groups, I shudder to think of having a government bungling the management of an electric utility where everyone, including and most particularly the economy, will suffer.
Under the present management, we do not have to bribe anyone in Meralco to get something done. Do you think this will still be possible if the government was running the show?
I doubt if other Meralco shareholders will even entertain a government takeover. They know government’s track record for corporate disasters very well and having government running Meralco will send its stocks irreversibly tumbling down.
Just last Wednesday, Meralco share price went down P2 while the stock market index went up by 11 points. Fear of a government management takeover caused that drop.
Just try running a page 1 headline announcing that government is already in possession of enough proxy votes to takeover Meralco and see how much lower Meralco shares will drop in the stock market.
Responses
Your Chair Wrecker received two letters clarifying certain points in our May 4 (kidney donors) and May 6 columns (Pharisees and GK).
Dr. Alberto Chua, past president of the Philippine Society of Nephrology (PSN) and the head of the PSN task force on the Kidney transplant issue, wrote to say that the PSN position I cited in my May 4 column was issued on March 31, 2008 and was a PSN response to the issue of foreign recipients of Filipino kidneys.
That does not however mean that the same arguments will not apply to the more recent issue of banning non-related Filipino donors and recipients.
Reacting to our May 6 column, CFC Director Joe Tale wrote to say that “There is no truth to the statement that the bishop was ‘fuming mad over the negative publicity he attracted’. In fact, there was little discussion on the aspect of ‘negative publicity.’”
Tale also said that the diocese-to-diocese recognition of the breakaway group was not a new statement but one that was already publicized sometime ago.
My reliable source said that “the bishop was very angry.” Alright, he was not fuming mad.
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