MANILA, Philippines — The Department of Finance (DOF) should look for additional funding for the implementation of the Murang Kuryente Act next year to avoid the possibility of borrowing funds, Senator Sherwin Gatchalian has said.
Gatchalian, who serves as the chairperson of the Senate committee on energy, made the remark after the recent budget deliberations on the proposed 2021 budget of the Power Sector Assets and Liabilities Management (PSALM) Corporation where it was learned that less than 20 percent or only P8 billion of the P46 billion request of the corporation for next year was allocated by the DOF for the implementation of the Murang Kuryente Act.
This means that PSALM will have to resort to borrowing for the additional P38.4 billion, with taxpayers bearing the brunt of covering the P5.45 billion borrowing cost, Gatchalian was told in the budget deliberations.
“That is not the spirit and intention of the law. We have to request the DOF to seriously look into this because the P5.45 billion is a hefty amount. If we will be incurring additional costs then it will still be passed on to the taxpayers because PSALM will need to borrow,” Gatchalian said.
“The law intends to save interests and borrowing costs but obviously that is not happening in this case,” the senator added.
The Murang Kuryente Act aims to source government shares on the Malampaya fund to pay the debts of the National Power Corporation (NPC) that is now being charged to consumers as reflected in their monthly electricity bill.
Based on the law, P208 billion of the proceeds from the net national government share from Malampaya fund will be utilized for the payment of stranded contract costs and stranded debts transferred to and assumed by PSALM pursuant to Section 49 of Republic Act No. 9136 or the Electric Power Industry Reform Act (EPIRA) of 2001.
President Rodrigo Duterte signed the measure in August 2019.