Tuesday, December 21, 2010

CODE-NGO, media hold dialogue on PEACe Bonds


The Caucus of Development NGO Networks (CODE-NGO) conducted a roundtable discussion Monday with members of the media to clear confusion over the Poverty Eradication and Alleviation Certificates (PEACe Bonds).

The matter of the PEACe Bonds has stirred much publicity and controversy since the recent appointment of former CODE-NGO chair Corazon “Dinky” Soliman as Social Welfare Secretary by Pres. Aquino. It has also generated interest as the bonds are set to mature in October 2011. Throughout the discussion, CODE-NGO and some business reporters lamented that some facts about the transaction are not being properly reported, were twisted or just disregarded.

“We are here, conducting this dialogue because we want to keep the public informed. We want to be transparent and honest regarding the conduct of the PEACe Bonds transaction and how the trading gain from the private capital market, is being managed and used for poverty alleviation” said CODE-NGO executive director Sixto Donato Macasaet.

The net trading gain of P1.4 billion was remitted to CODE-NGO by its agent, RCBC, which bought the PEACe Bonds through a public auction from the government in 2001 and sold them in turn to private investors. The Arroyo administration, on the other hand, received the full net present value of the 10 year bonds at that time, which was P10.17 billion.

The 1.4 billion trading gain, which are in fact private funds, has since been entrusted as an endowment fund to the Peace and Equity Foundation (PEF), which manages and preserves the fund for poverty alleviation projects. The utilization of the fund as well as PEF accomplishments has always been made available to the public through its website, http://www.pef.ph/.

Former PEF treasurer Senen C. Bacani, however, clarified that neither PEF nor CODE-NGO has information on how the money generated from the auction of the PEACe bonds was spent as the P10.17 billion went to the government and not to the CODE-NGO network.

“Critics are barking up the wrong tree. CODE-NGO and PEF can explain how the 1.4 billion, a private fund, is being utilized for projects to assist poverty-stricken Filipinos, especially those in the rural areas. But if you want to know how the P10.17 billion government money was spent, it would be best to ask the people who ran the government at that time.”

Vitaliano Nanagas II, a banking and financial adviser, refuted allegations that the auction of the zero coupon bonds was rigged. The banks involved in the public auction acknowledged that the CODE-NGO offer was lower. The sale was conducted through an auction, wherein the lowest bid wins. CODE-NGO and its agent RCBC had to outbid 14 prominent banks to purchase the PEACe Bonds.

“We were out-bid,” said Nanagas. “I was working for a bank at that time and honestly, mas mababa talaga yung submission ng CODE-NGO.” (RCBC's bid for CODE NGO was truly lower than ours).”

CODE-NGO board members were asked if they were willing to face another Senate investigation into the PEACe Bonds. Macasaet and Bacani said they will continue to appear in inquiries whenever asked, and present documents supporting the legality of the PEACe Bonds. Moreover, regarding the current congressional hearings on the issue, they are hoping for a final report from the House of Representatives to bring closure to the matter, as declared by the Resolution author, Cong. Rufus Rodriguez. The Senate and the House separately investigated the PEACe Bonds in 2002, but neither ever released a committee report.

“We are willing and ready to appear at any hearing to show there is nothing illegal about the PEACe Bonds.”

Bacani ended the forum by assuring reporters that Hector Soliman, spouse of Dinky Soliman, was never involved in the PEACe Bonds transaction. “It is true that Hector was Corporate Secretary of the PEF board, but I assure you he had nothing to do with the PEACE Bonds. He has long worked with NGOs and is known to those in the PEF Board who come from NGOs. We asked him to help out with the SEC registration of PEF and that lasted for only about five months.”

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