Amending Public Service Act To Boost PH Competitiveness

Amending Public Service Act To Boost PH Competitiveness


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A party-list legislator said the speedy passage of the proposed measure, which seeks to amend the 83-year-old Public Service Act (PSA), will improve the country’s competitiveness ranking, as well as the lives of Filipinos.

AAMBIS-OWA Party-list Rep. Sharon Garin said Philippine competitiveness, as well as its economic growth and development, is hampered because the Constitution limits the operation of public utilities to Filipino-owned corporations, with the same limitations being applied to all public services.

“By eliminating the ambiguity of the law, more economic opportunities will be provided to the Filipino people. The passage of House Bill 78 will allow new players to invest in the Philippines, therefore ushering competitive industries and reducing prices for Filipino consumers,” the chairperson of the House Committee on Economic Affairs said.

HB 78 aims to amend the Public Service Act of 1936 by providing a clear distinction between public service and public utility.

Under the bill, public utilities will only cover the distribution of electricity; transmission of electricity; water pipeline distribution system; and sewerage pipeline system.

The proposed measure also prescribes a mechanism for rate fixing that allows a reasonable rate of return to attract investments into public utilities; updates the applicable penalties and fees for public services; and strengthens the enforcement remedies of administrative agencies

Garin said even the Philippine Development Plan of the National Economic and Development Authority (NEDA) cited the importance of amending the PSA as “crucial to expanding economic opportunities and increasing the competitiveness of the Philippines.”

“The bill espouses the goal of providing a strongly-rooted, comfortable, and secure life for all Filipinos stated in NEDA’s AmBisyon 2040,” she said.

Garin’s statements came following a report by The World Economic Forum which showed the Philippines dropping eight notches to 64th out of 141 economies in its recently published 2019 Global Competitiveness Report.

According to the same report, the country also slid to sixth in the Southeast Asian rankings, down from its fifth placing last year.

“Something can be done to improve our standing, and that is through the passage of HB 78,” Garin said.

Meanwhile, the bill’s main sponsor assured that safeguards are well in place under the proposed amendments, allaying fears posed by the expected influx of foreign investors.

“We only want foreign investments to supplement Filipino capital. Kasi, kailangan rin ng tulong ng Pilipino para makapagtayo tayo ng malalaking industriya, malalaking negosyo (Filipinos also need help in establishing large industries and businesses) so we can improve the basic services for the Filipinos,” Garin said.

“I do not believe that this will be a threat to our patrimony. I think this will improve the lives of all Filipinos,” she said.

Her views were shared by Albay Rep. Joey Salceda, who earlier said competition and foreign investment are inhibited because limitations that should only apply to public utilities are usually also applied to all public services.

The chairperson of the House Ways and means Committee and one of the principal authors of HB 78 said the key to fixing this problem is to develop a clear statutory definition of a public utility.

“This legislative reform will significantly contribute to increasing competition, as well as protecting the public interest. More competition among providers would result in lower prices and improved quality of basic services in the Philippines, thus creating a more competitive economy towards a better quality of life for all,” Salceda said. (PNA)

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