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Biz Buzz: Over budget? No problem

/ 01:04 AM August 01, 2016

THREE years to the day after businessman Ramon Ang made a personal donation to the Jesuits to build a “wellness center” (which is, in truth, a euphemism for “hospital”), the new building was inaugurated last Friday in ceremonies attended by the country’s top Jesuit priests and educators and the San Miguel president and his children.

In its final form, the so-called “Jesuit Health and Wellness Center” is a four-story structure (five, counting the basement) with 40 rooms to house aging and ill priests who have since retired from their priestly duties. Among other medical facilities, the building also houses a fully equipped physical therapy room-cum-fitness center, including a therapy pool.


This marks a significant improvement over the Jesuits’ old infirmary, which used to be located in one dark wing of the adjacent Loyola House of Studies. The construction of the medical building was delayed by a year after engineers discovered that the proposed site was straddling the West Valley fault line and had to be moved by a few meters.

Of course, the initial donation of P120 million was made during the Mass to celebrate the feast of St. Ignatius at the Ateneo in 2013 (Ang took his engineering education from the Far Eastern University, but all of his children are Jesuit-educated).

However, the delays and design adjustments led to a somewhat significant cost overrun. Nonetheless, the extra expenses didn’t seem to bother Ang who, as he was being given a tour of the facility last Friday, committed even more resources to the undertaking. (“Add floor-standing air-conditioning units to this hall, so that the patients can dine in comfort,” he instructed his staffer during a tour of the dining area.)

Biz Buzz learned that, three years after the project was conceptualized, the final bill later had risen to—brace yourselves—P200 million. That’s 66-percent more than the original donation. Wow!

But what’s a few million to philanthropic billionaires, right?  Daxim L. Lucas

Wanted: Landbank president

TWO WEEKS after a surprise vacancy was created for the presidency of the state-owned Land Bank of the Philippines, the government is still looking for a replacement for the bank’s former CEO, Gilda Pico.

Pico—a career bank official who had served as the head of the bank since her appointment by then President Arroyo in 2006—left the bank abruptly two weeks ago, on the day the new government board had its first meeting.

People are still wondering what happened to Pico, who seemed set to serve on as bank president, despite earlier pronouncements that she was ready to retire.


In fact, Biz Buzz learned that Finance Secretary Carlos Dominguez III had no intention at all of replacing Pico as finding enough candidates to fill the hundreds of posts in the new administration was difficult enough.

On the day of the new board’s first meeting, however, they were made aware that Pico was the subject of an earlier dismissal order from the Office of the Ombudsman over an investment decision made by the bank many years ago (the bank actually earned from that investment, but the Ombudsman decided that shortcuts were made). However, Pico and her lawyers appealed the case at the Court of Appeals and won.

Faced with the Ombudsman’s dismissal order and a Court of Appeals decision invalidating the former, Landbank’s new board decided to err on the side of caution. She was given the option to resign, but Biz Buzz learned that she declined this face-saving route since it might compromise her legal position (as well as a more substantial retirement package). So out she went on that very day.

The bigger question now is who will be chosen to head the government’s biggest bank, with the current officer-in-charge Andres Sarmiento also set to retire by the end of August? Abangan! Daxim L. Lucas

Housing via usufruct

BUSINESS magnate Isidro Consunji, the big boss of conglomerate DMCI Holdings, has a suggestion for Vice President and housing czar Leni Robredo on how to help salaried government workers avail themselves of decent housing.

One solution to make housing affordable to civil servants, he said, would be for the government to give usufruct rights and tap private developers to build affordable housing for them. “They have ownership but they don’t have to buy the land,” Consunji noted.

In property development, Consunji said one big factor was land scarcity, adding that it was only the government which could address such bottleneck by assigning some of its idle land for housing.

Usufruct—defined as a legal right to use and derive income or benefit from someone else’s property—is usually conferred for a limited time period or until death.

DMCI, of course, knows where it’s coming from as the developer of Bonifacio Heights, the first off-base condominium AFP housing project (with resort amenities) along Lawton Avenue in Fort Bonifacio, a stone’s throw from BGC. If VP Leni were to replicate the Bonifacio Heights model, he said it would make many government workers very happy. Doris Dumlao-Abadilla

A worried energy sector

IF THE mining industry is worried about the appointment of Gina Lopez as secretary of environment and natural resources, the energy industry is, for its part, also worried about a certain appointment in the legislative branch of government.

A few years ago, a large power utility in the Visayas discovered that the electricity meter at one of its large commercial customers was tampered with, resulting in this customer paying lower electricity bills than what they should have. The value of the pilfered electricity was calculated to be in the millions of pesos.

A complaint was filed with the authorities for the client’s alleged violation of the Anti-Electricity and Electric Transmission Lines/Materials Pilferage Act, and the case went all the way to the Energy Regulatory Commission.

The power utility was demanding P168 million in back payment, but the amount was eventually reduced to P38 million.

To no one’s surprise, the power utility won the case and the ERC in 2013 found the firm “to have consumed electricity that was not registered in the billing/kilowatt-hour meter due to an altered metering facility.”

Still not having settled the bill a year later, the firm filed an appeal at the ERC, with the regulator eventually dismissed, torpedoing the company’s alibi that a third party tampered with its meter, but saying that the firm should have regularly monitored its own electricity connection and bills. Basically, the regulator said the large power consumer (which belongs to the leisure and entertainment sector) should have known that it was paying for less electricity than it should have.

Fast forward to the present, and the recent apportioning of committees in the legislature to winning lawmakers. To the surprise of everyone in the energy sector, the new leaders in the legislature gave the energy committee chairmanship to a lawmaker whose family owns the power-pilfering firm (Clue: The company is based in Cebu).

Uh-oh. What’s going to happen now? Daxim L. Lucas

Regional marketing honor

PO FAMILY-LED Century Pacific Food Inc. (CNPF) is Asia’s “Marketing Company of the Year,” according to Asia’s foremost governing bodies in marketing, Asia Marketing Federation (AMF).

The Filipino company behind household brands Century Tuna, Argentina Corned Beef, 555 Sardines, Angel Milk and Birch Tree emerged on top of the heap after AMF sifted through 40 companies from all over the region that were nominated for the prestigious award.

CNPF, which was nominated by the Philippine Marketing Association (PMA), will receive the award at the upcoming Asia Marketing Excellence Awards to be held in South Korea on Sept. 22.

“The Philippine Marketing Association is extremely proud of Century Pacific for this win. It is much deserved for a world-class Filipino company that has raised the bar for marketing excellence,” said PMA president Pinky Yee. Doris Dumlao-Abadilla

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TAGS: Business, economy, Land Bank of the Philippines, News, Ramon Ang, San Miguel Corp.
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