Sunday, December 4, 2011
THE score on the paperless Baguio-Benguet Electric Cooperative
(Beneco) deal is set to be ironed-out soon with Beneco tasked to draft a
formal agreement to end nearly two years of dispute as to how much one
owes the other.
Mayor Mauricio Domogan said the parties’ joint technical team finally
came up with common formula to compute power purchased by Beneco and
the City-led operations of the Asin Mini-hydroelectric Plants (AMP)
after a meeting last November 29.
The mayor expressed hope some adjustments could be made in the
billing computations to squeeze out a bit more doe from the 86-year-old
AMP.
“During the November 29 meeting, Beneco General Manager Gerardo
Versoza accepted reduction of systems loss from 18.5 percent to 8.5
percent,” Domogan said.
The reduction, the mayor said, translates into P8.5 million in
payables arising from the baseless over-deduction of 18.5 percent
systems loss discounted from the amount Beneco was supposed to pay the
city had the same been pegged to 8.5-percent.
The P8.5 million shall be paid within a period of 27 months -- the
same length of time Beneco used the 18.5-percent systems loss as a way
of discounting its payables to the city.
Domogan said, “I don’t understand why Beneco even deducts as much as
18-percent [which could translate to bigger income for the city] when it
is merely a buyer of the power we produce.”
Beneco and the City Government, nil written agreement, likewise
consented to an electric power exchange rate using National Power
Corporation standard power tariff at P4.80 per KWH sometime in 2007.
“But records show us otherwise,” Domogan said, adding: “I don’t see Beneco using NPC rates as basis of their computations.”
Meanwhile, Domogan revealed Beneco’s apparent grunting over a
provision in the bidding conditions for privatization of the hydros.
He said “Beneco wrote the council saying they were allegedly
discriminated upon with the condition that only cooperatives registered
under the Cooperative Development Authority (CDA) can join the bid.”
“I explained however that, while they may be disqualified from
bidding not being CDA-registered, they may bid as a National Irrigation
Administration (NIA) – registered cooperative,” he added. (Isagani Liporada)
Friday, December 9, 2011
Leyeco V’s plea for 77-centavo hike includes flagrant expenses
A SCANNED COPY of the operating expenses of
Leyeco V from 2005 to 2009. NASECORE points out it is worth
scrutinizing. Noteworthy are the Employees Benefits. There is also the
advertising expense, the “miscellaneous”, and “uncollectible accounts”.
NASECORE said that electric utilities are mandated by law to be prudent
with its expenditures, following 3 tenets: Is it needed? Is it
recurring? And will it benefit the consumers?
Rodolfo “Butch” Celestial, regional coordinator of National Association of Electricity Consumers for Reforms, Inc. (Nasecore), said that if only Leyeco V consumers would care to scrutinize the coop’s petition to raise power rates by 77-centavos per kilowatt-hour for the next five years, some proposed expenditures are “flagrant” or immoral.
This was Celestial’s observation on Saturday before a forum of the Ormoc Chamber of Commerce and Industry, together with the Consumers Advocate Group, when he walked them through some items in the petition.
He said that the law on electric utilities requires that expenditures be prudent.
The law, he added, operates on three simple tenets: Is it needed? Is it recurring? And will it redound to the benefit of the consumers?
“Do you need a mini-Superdome?”, he asked. “Will you benefit from it?”, he added. “No”, the audience chorused.
“Do you think it can be finished with only P3-million? The cost of a residential house nowadays?”, he posed further.
The NASECORE official said he wonders how many more “flagrant” expenses will Leyeco V consumers discover on the 208-page Distribution Development Plan for 2011-2015.
He urged the audience to attend the December 2 “orientation” on the petition as ordered by ERC on Leyeco V, when it noticed that majority of the people who attended the hearing were coop employees and there were only three board directors around.
“It’s time you wake up”, he said, and “get involved”.
NASECORE acted as intervenor during the hearing on the petition last November 8, and succeeded in having it suspended after the hearing officer noted that even the proponents could not explain their brief well.
Over-collection of P250-million
He also made some startling revelations. He said that per their study of Leyeco V’s financial reports for a period of five years, they have good reason to believe that the coop has “over collected” from its consumers some P250-million over the years.
“Remember, the coop is only allowed to charge a fixed amount over its actual purchased power and its total operating expenses remains more or less the same”, he said. But over the years, he added, the power purchased has increased, meaning there has been an increase of revenue for Leyeco V vis a vis it’s usual, recurring operating expenses.
In businessman’s lingo, he said, this is called “increased profit” which is unconscionable because Leyeco V is supposed to be a non-stock, non-profit “cooperative”. “This is your money. They should be returning that to you. If not in cash, then in form of deductions from your bill.”, he said.
The NASECORE has already written the Energy Regulatory Commission about it and they are hoping for a positive feedback anytime. NASECORE is the same group that succeeded in making MERALCO refund its consumers an “over collection” of more than P800-million.
Five percent reinvestment fund
He also explained about the five percent “reinvestment fund”, a strictly regulated fund. He said this fund could only be used by submitting a development plan to the National Electrification Administration and have it approved.
Their queries show that Leyeco V has not touched this fund, which it could have used to improve its lines and service over the years without waiting to petition for an increase of 77-centavos to do a job that it could have done years ago.
A copy of the audited financial statement of Leyeco V obtained show that the so-called “reinvestment fund” of the Leyeco V has reached 290-million already.
This does not include a P51-million fund that was supposed to be “refunded” to consumers for their meter deposits which was proposed during the general assembly to be “donated” to the coop as “contribution in aid of construction”.
During that assembly, it was explained that if it would be forced that the cooperative be made to cough up P51-million, then it would have liquidity problems.
But NASECORE claims that the coop has been making a profit through the years. In 2010, it posted a net profit of 42-million before a depreciation of P11-million was deducted.
NASECORE also furnished the audience copies of the operating, maintenance and administrative expenses of the coop from 2005 to 2009. He said that if perused closely, there are items like roughly an average of P 1. 3 million for “information, instructional and advertising”; another P 1.3-million for “miscellaneous”; and “employees benefits” for 2009 is at P38-million already. There is also an average of P1-million a year for “representation and entertainment”.
He said these were items that were worth looking into. Again, he said, it should follow the 3 principles: Is it needed? Is it recurring? And will it redound to the consumers’ benefit?
Electric coop employees highly paid
Celestial said that consumers might be surprised to know that electric cooperative managers and employees are among the highest paid, with lots of perks and benefits.
Atty. Jerry Gwen Conde of Leyeco II in Tacloban, he said, receives a monthly salary of P95,000 plus perks. Concurrently the manager of Leyeco III in Tunga, he also gets another P40,000. “He is the only person I know who can work 200 percent”, Celestial joked.
He added that with this information, “are you not curious to know how much your manager is receiving?”
“How much do you think your previous manager get for his retirement?”, he added, because the manager of SAMELCO who just recently retired got P10-million.
The figure surprised Atty. Roy Bernard Fiel who whooped “Wow, mura man og GOCC!”.
CDA registration
The speaker, on the other hand, said that what was important was that Leyeco V consumers “start waking up” and “be vigilant”. He also explained their group is advocating for registration of the cooperatives with the Cooperative Development Authority (CDA).
This way, he said, people become the real owners of the electric utility and whatever profits the utility makes, it will be returned to them in patronage refunds and dividends as “owners” of the coop.
He debunked claims that cooperatives that opted to register with CDA have flopped. He said that in a future forum, he would bring over the manager of a successful CDA registered electric cooperative to speak before the chamber, including the APEC party-list congressman.
APEC, he said, was Leyeco V’s party list of choice in the past year but they junked it last 2010 because APEC advocated to be registered under CDA.
Meanwhile, Atty. Fiel said that the Ormoc Chamber would not oppose the petition for increase just for the sake of opposing. He said the chamber is willing to hear what Leyeco V plans to do with the increase it is asking, but he would also want honest answers to some questions that has formed in his mind.
Fiel is not new to opposing Leyeco V petitions for rate hikes. During his incumbency as president, he opposed a similar petition and was able to hold it off for around four years. Unfortunately, he was not able to pursue it because the chamber lacked funds. The hearings then were being held in Manila.
Celestial, however, said this is not true anymore. As long as the consumers write ERC to hold the hearings where the affected localities are, they come.
http://bit.ly/rOSiPx
Friday, December 2, 2011
Newscoop’s net income up by P84T this year
Thursday, December 1, 2011
THE Cebu News Workers Multipurpose Cooperative (Newscoop) announced a net income of P793,000 as of Oct. 31, or an increase of P84,000 compared to the P709,000 of the same period last year.
Newscoop chairman Elias O. Baquero is confident that they will meet the P1-million target income by the end of this year, as they are maximizing the utilization of idle funds such as placing them in time deposits and products distribution.
“The amount is already a net income. This means we can give more dividends to our Newscoop members during the general assembly in April 2012,” Baquero said.
The dividends for 2010 was P437,000 of which the Newscoop Board is planning to increase by P600,000 for this year.
Support
Baquero was grateful for the support of the members of the Board, namely Oscar Pineda, Michelle P. So, Joseph Tubilan and Luz Cuyos, all of Sun.Star Cebu; vice chairperson Mayen Angbetic Tan, Mariflor Perolina, Lucky Malicay and John Rey Saavedra, all of The Freeman; Sam Costanilla of CCTN 47; and Chester Abadilla of radio dyRF for their participation in the formulation of business policies and its implementation by the management.
The others who also played an active role in the Newscoop operations are manager-on-leave Roberta Verano, credit committee chair Marissa Fernan, secretary Liv G. Campo, corporate treasurer Eileen G. Mangubat, Comelec chair Debbie Duraliza, Emy Lucena, among others.
Assets
Baquero said that as of Oct. 31, Newscoop’s total assets (with a very high liquidity percentage) is P13.825 million. This figure has been verified by Certified Public Accountant Franco Baricuatro, and is still increasing.
According to the records of the Cooperative Development Authority (CDA), Newscoop is the only successful media cooperative in the country, and with a strong Board of Directors at present.
Acting manager Evelyn Sarsale said that the target expenses for 2011 is P1.5 million which include salaries and wages; premiums for Social Security System (SSS), Philhealth and Pag-ibig; general assembly expenses; meetings and conferences; office supplies; and travels and transportation; among others. But so far, with only less than a month left, the total expenses are P1.1 million.
Evaluation
“Although seminars for members of the Board of Directors are mandatory under Republic Act 9520, we were able to trim down expenses to maximize net income,” Baquero added.
Last month, the National Confederation of Cooperatives (NATCCO) Network conducted evaluations on the more than 1,500 cooperatives in the Visayas, and they concluded that Newscoop improved its rating rank from 18 to 13.
THE Cebu News Workers Multipurpose Cooperative (Newscoop) announced a net income of P793,000 as of Oct. 31, or an increase of P84,000 compared to the P709,000 of the same period last year.
Newscoop chairman Elias O. Baquero is confident that they will meet the P1-million target income by the end of this year, as they are maximizing the utilization of idle funds such as placing them in time deposits and products distribution.
“The amount is already a net income. This means we can give more dividends to our Newscoop members during the general assembly in April 2012,” Baquero said.
The dividends for 2010 was P437,000 of which the Newscoop Board is planning to increase by P600,000 for this year.
Support
Baquero was grateful for the support of the members of the Board, namely Oscar Pineda, Michelle P. So, Joseph Tubilan and Luz Cuyos, all of Sun.Star Cebu; vice chairperson Mayen Angbetic Tan, Mariflor Perolina, Lucky Malicay and John Rey Saavedra, all of The Freeman; Sam Costanilla of CCTN 47; and Chester Abadilla of radio dyRF for their participation in the formulation of business policies and its implementation by the management.
The others who also played an active role in the Newscoop operations are manager-on-leave Roberta Verano, credit committee chair Marissa Fernan, secretary Liv G. Campo, corporate treasurer Eileen G. Mangubat, Comelec chair Debbie Duraliza, Emy Lucena, among others.
Assets
Baquero said that as of Oct. 31, Newscoop’s total assets (with a very high liquidity percentage) is P13.825 million. This figure has been verified by Certified Public Accountant Franco Baricuatro, and is still increasing.
According to the records of the Cooperative Development Authority (CDA), Newscoop is the only successful media cooperative in the country, and with a strong Board of Directors at present.
Acting manager Evelyn Sarsale said that the target expenses for 2011 is P1.5 million which include salaries and wages; premiums for Social Security System (SSS), Philhealth and Pag-ibig; general assembly expenses; meetings and conferences; office supplies; and travels and transportation; among others. But so far, with only less than a month left, the total expenses are P1.1 million.
Evaluation
“Although seminars for members of the Board of Directors are mandatory under Republic Act 9520, we were able to trim down expenses to maximize net income,” Baquero added.
Last month, the National Confederation of Cooperatives (NATCCO) Network conducted evaluations on the more than 1,500 cooperatives in the Visayas, and they concluded that Newscoop improved its rating rank from 18 to 13.
Thursday, December 1, 2011
Electric coops do not need CDA: lawyer
By Loui S. Maliza
Monday, November 28, 2011A LAWYER said electric cooperatives do not need to be registered with the Cooperative Development Authority (CDA) to become stronger in servicing its concessionaires.
Lawyer Chito Oclarit said electric cooperatives are created by law under the supervision of the National Electrification Administration (NEA).
“That’s why we’re not fake,” Oclarit said in response to allegations that most of electric cooperatives are actually operating not as “genuine cooperatives.”
Oclarit is one of the legal counsels for the Misamis Oriental Rural Electric Service Cooperative in Laguindingan town, Misamis Oriental.
He said once the electric cooperatives register with the CDA, it would practically become as stock organization.
“And if we become as stock cooperative, our rural electrification projects would be stopped. We cannot anymore help the rural areas to be energized. We already exist 40 years ago, and this is our program to energize even those areas that are not viable,” he said.
Running well
Out of 119 electric cooperatives, only 12 registered with the CDA.
“But most of them went bankrupted,” Oclarit said.
He said electric cooperatives are “running well,” and do not need the supervision of the cooperative agency.
“If we become as stock cooperative, maybe only five people control certain electric cooperative,” he warned.
The lawyer even said electric cooperatives branded as “fake” are earning that it can even finance its rural energization programs.
Tax exemption and dividends
According to the CDA, electric cooperatives are tax exempt if registered with the cooperative department. But according to Oclarit, it would be more advantageous for the power providers to stay under the umbrella of the NEA.
“Electric cooperatives are taxed up to one percent only and we give return of investment (ROI) in the form of dividends to the members from eight to 12 percent. What if these dividends are used to energize the rural areas, it would be more advantageous to the government. Even President Benigno Aquino supports the rural electrification programs of these electric cooperatives,” he said.
As non-stock non-profit organization, electric cooperatives are giving ROIs to its concessionaires in the form of “patronage refund.”
“We’re not looking at returning the investments of the consumers… we are concentrating on our rural electrification programs. We need to give priorities to the people first before dividends,” he said.
http://bit.ly/tzDxsD
Board member: Tax electric coops now
By Florence F. Hibionada
Sunday, November 27, 2011THE Provincial Board is set to deliberate the imposition of real property tax (RPT) from all electric cooperatives in Iloilo City.
Board Member Gerardo Flores, in a privilege speech Friday, proposed the move as he pointed out to the body a Supreme Court (SC) ruling that supposedly allows now RPT collection.
Such, as he noted the lifting of an earlier temporary restraining order (TRO) that held off imposition of said tax dues.
Electric cooperatives in the country, including the Iloilo I Electric Cooperative Inc. (Ileco 1), hurled to court the Department of Interior and Local Government and the Department of Finance.
The contention was that Sections 193 and 234 of Republic Act 7160, otherwise known as the Local Government Code, were unconstitutional.
The electric cooperatives’ position was that government incentives are in place and guaranteed among others the permanent exemption from payment of income taxes. The group said Presidential Decree 269 covered this, thus the exemption from payment of local taxes, including RPT.
While Sections 193 and 234 of RA 7160, the electric cooperatives said, effected the withdrawal of said tax exemption. The group added the provision discriminated the industry and was “in violation of equal protection of the law clause.”
But Flores said the petition and position of the electric cooperatives have been denied after the earlier TRO issued was lifted.
“With the above decision of the Supreme Court, only those cooperative under the Cooperative Code of the Philippines are exempted from the LGU’s taxing powers and effect, renders Ileco 1 and the rest of the electric cooperatives in Iloilo, which are not registered under RA No. 6938, taxable,” Flores said.
“In this regard, this representation would like to propose that with the lifting of the TRO, the provincial assessor and the municipal assessor to make a classification, appraisal and assessment of all properties of Ileco I, II, III, and to assess the taxes of these electric cooperatives on every host LGU for ten years thereto,” Flores added.
At the center of this recurring issue is the Department of Justice’s stance that in order for a cooperative to enjoy incentives granted by RA 6938, the registration with the Cooperative Development Authority (CDA) is required. With that, no CDA registration, no exemption.
The Bureau of Local Government Finance in Memorandum Circular No. 13-2003 stated that the same wherein only electric cooperatives registered with the CDA are exempt from RPT.
http://bit.ly/tcL486
Revisiting our amended Cooperative Code
Business Option
By NAPOLEON T. CABELLO
November 29, 2011, 2:03am
It’s also interesting to note that cooperatives have a special mention in our Constitution. Section 1 of Article XII mandates among others, that the state shall promote industrialization and full employment through private enterprises, including corporation, cooperatives, and similar collective organizations. The entire Section 15 under same article further provides that “the Congress shall create an agency to promote the viability and growth of cooperatives as instruments for social justice and economic development.” Thus, under our Constitution, we could reasonably argue that when we need a job, there are three alternatives legally available: get a job provided by somebody else (corporate employment); invent a job and work by yourself (entrepreneurship); or work in cooperation with others (cooperatives).
Sadly, after more than two decades, our cooperative development efforts still urgently need the light of day. In 2009, there were 78,611 cooperatives existing on paper but only a third or 23,836 were reported operational. These active cooperatives were composed of 5,856,000 members or a mere 6.0 percent of our total population. This is a far cry from Singapore’s 50.0 percent! We are also lagging behind our other Asian neighbors. As measured against their total number of family households, cooperative members in Indonesia and Japan represent 27.5 percent and 33.0 percent, respectively. South Korea is also much ahead with 40 percent of their agriculture produce being marketed via cooperatives.
On Feb. 17, 2009 our 18-year old law was finally amended to further strengthen the regulatory powers of the Cooperative Development Authority (CDA), an agency tasked to oversee the operation of all cooperatives nationwide. The new code (R.A. 9520) further grants limited banking functions, expands the types or categories of cooperatives, and provides enhancements to their existing tax exemption privileges and non-tax benefits. Some of the salient features of the new code are itemized below.
Tax-Exemption Benefits
A cooperative must be duly registered with CDA and must hold a BIR Certificate of Tax Exemption before it could officially avail of tax exemptions. R.A. 9520 differentiates cooperatives which transact business only with their members and those that deal with both members and non-members. For the first classification, cooperatives are fully exempted from paying all existing taxes and fees such as: the 32 percent income tax, 12 percent VAT, percentage tax, customs duties, donors’ tax, excise tax, documentary stamp tax, and annual registration fee. Exemption also covers taxes on transactions with banks and insurance companies, including but not limited to the 20 percent final withholding tax on interest deposits and 7.5 percent final tax on interest income derived from foreign currency deposits.
For cooperatives that deal with both members and non-members, if the accumulated reserves and undivided net savings do not exceed P10 million, the same tax exemption privileges apply, otherwise, only transactions with members are tax-exempt. Overall, however, incomes that are not related to the cooperative’s main business are still subject to certain applicable taxes such as capital gains tax as well as withholding tax on other extraordinary compensation or income.
Non-Tax Privileges
Cooperatives may enter into contracts with local government units to have preferential right to supply agricultural and marine products to government institutions and agencies. They are also exempted from prequalification bidding requirements when transacting business with the government. They can also deposit important documents in the safe of municipal/city treasurer and other government offices free of charge. They can also be represented pro-bono by the provincial or city prosecutor or the Office of the Solicitor General except when the adverse party is the government. Cooperatives are also exempted from paying court/sheriff fees and putting up a bond during court litigation.
The new code also allows the conversion of Credit Cooperatives into Financial Services Cooperative to provide savings and credit to their members and other financial services subject to the regulations of the Bangko Sentral ng Pilipinas (BSP). Certain cooperatives like housing and transport services are also entitled to financial support from various government financing institutions.
Other Major Conditions and Features
R.A. 9520 prohibits members of the board of directors from assuming management functions directly involved in day-to-day operation (this was the source of conflicts among members and their officers and directors under the old law). The new code has also professionalized the management and operation of cooperatives and provided monitoring tools for the cooperative in conducting self-assessments of their managerial, financial, and social objectives. However, newly-organized cooperatives are not allowed to function as multi-purpose cooperatives except after two years of operation.
To provide more livelihood opportunities, R.A. 9520 has also expanded the types of cooperatives allowed from six to about seventeen that now specifically includes: advocacy, cooperative bank, agrarian land reform, electricity, water, dairy, education, financial services, health services, housing, fishermen, insurance, transport, workers coops, and others.
***
(The author is a member of the Financial Executives Institute of the Philippines (FINEX). For comments, his email address: napcabello@yahoo.com).
http://bit.ly/roTOxW
Sunday, November 27, 2011
The increasing role of workers’ cooperatives
THINKING GLOBAL
By: Dr. Bernardo M. Villegas
INQUIRER.net
12:31 am | Friday, November 25th, 2011
There are many ways of skinning the capitalist cat. Instead of the
Marxist cry for workers to unite to destroy the free enterprise system
and replace it with Socialism, there is the rising trend towards workers
forming cooperatives to engage in all types of business. I am glad to
see more workers’ cooperatives in the Philippine business scene.My recent two-year residence in Spain gave me a glimpse of what could be a most powerful instrument to attain the aspiration of the Philippine Development Plan, 2011 to 2016 of “inclusive growth.” As the country finally achieves authentic industrialization, with more and more workers being absorbed in the various industry sectors of mining, manufacturing, construction, and public utilities, the fledgling workers’ cooperatives that are now beginning to appear in Philippine business can blossom into powerful conglomerates such as the Mondragon Cooperative, a workers’ cooperative in Spain started more than fifty years ago by a Catholic priest. Mondragon ranks among the top ten largest businesses in Spain with the most diversified investments in banking, manufacturing, retailing and real estate. I met some of the top executives of this famous workers’ cooperative (which started in Northern Spain), who briefed me on the phenomenal growth of their organization, which implemented to the letter the principles of empowering workers found in the social encyclicals of the Catholic Church. In fact, its founder’s process of beatification is now ongoing.
I am glad that the final definition of the role of workers’ cooperatives in Philippine business is now coming to a head as the Labor Code is being updated. The proposed amendment of the “Rules Implementing Articles 105 to 109 of the Labor Code” by Secretary of Labor Baldoz has created a perfect opportunity to enlighten all the stakeholders of business about the nature and essence of workers cooperatives. As defined under Article 23 (t) of RA 9520, a workers’ cooperative is “one organized by workers, including the self-employed, who are at the same time the members and owners of the enterprise.” More specifically, it is a social enterprise that is managed by the members who offer labor as their services to different companies, institutions or entities. In effect, these members are self-employed individuals who enter into commercial agreements with corporations and institutions through the cooperative that they have duly formed and organized.
Through a workers’ cooperative, the members are enabled to render work or labor as the product, service or business thereof, and in return, not only do these individual members earn from their own labor, but also benefit from the labor or work of the other members. This form of business is clearly in keeping with the essence of a cooperative, which is an organization voluntarily formed by individuals for their mutual benefit and support, who equitably share in the capital, participate in the services and become entitled to a fair share of the benefits, as well as in the other consequences of the undertaking.
Workers’ cooperatives have been in existence since the 1930s, initially formed by hat makers, bakers and garments workers. At present, workers’ cooperatives are globally recognized, with hundreds established in Europe, North America, South America, the Middle East and India. Among the more famous ones, in addition to the Mondragon Cooperative in Spain, are Cheque Dejuener and Acome in France, Kantega in Norway, Suma Wholefoods in the UK, Egged-Israel Transport Cooperative Society in Israel, Indian Coffee Houses in India, and Cooperativa Drapner RL and Cooperativa Nacional de Ahorro y Prestamo in Venezuela. Italy has about 8,000 existing workers’ cooperatives. In North America, workers’ cooperatives have organized the United Sates Federation of Workers Cooperatives and the Canadian Workers Cooperatives Federation.
Workers’ cooperatives are clearly contemplated in the 1987 Constitution of the Philippines, which recognizes the rights of workers to form organizations, associations or cooperatives for their common benefit. There is need, however, for the Labor Code of the Philippines to explicitly recognize the existence of workers’ cooperatives. In the already antiquated Labor Code, there is an almost exclusive focus on the relationships between employers and employees, failing to take into account situations in which entities and institutions enter into commercial agreements with laborers who are self-employed workers. In view of the growing demand for and supply of this form of contractual relationship, it is necessary to amend certain provisions of the Labor Code to effectively include, recognize and protect the rights of these self-employed laborers who rightfully belong to a workers’ cooperative.
The revision of the Labor Code should, therefore, include an amendment of Article 211 under Chapter I, Book V, on Labor Relations. The following State policy should be added: “(h) to promote and foster social enterprises, such as but not limited to cooperatives and associations formed by contingent, self-employed or non-regular employees for the protection of their rights and the promotion of social justice and development.” This proposed amendment will assure industrial peace because it will provide for clear guidelines for business-to-business negotiations between the members of the cooperatives and the corporations, entities or industries in need of labor services.
Secondly, there should be an additional Article in the Labor Code under Chapter III, Payment of Wages in Title II, Book III, after Article 106 and 107, addressing the workers’ cooperative in particular. The amendment reads as follows: “Whenever a person, partnership, association or corporation which, not being an employer contracts with a workers’ cooperative, for the performance of any work, task, job or project, the workers of the said cooperative shall be paid in accordance with the provisions of this Code. A “workers’ cooperative” is one organized by self-employed workers who are at the same time the members and owners of the enterprise. The workers’ cooperative shall not be deemed the employer of its owner-members but shall be the organization that will ensure that the minimum standards and benefits as required by law are provided to its owners-members.
A third amendment is proposed of Article 82 under Chapter I (Hours of Work) in Title I, Book III, of the Labor Code to explicitly include members of workers’ cooperatives in the provision: Article 82. Coverage – The provisions of this Title shall apply to workers in all establishments and undertakings whether for profit or not, but not to government employees, managerial employees, field personnel, members of the family of the employer who are dependent on him for support, domestic helpers, persons in the personal service of another, and workers who are paid by results as determined by the Secretary of Labor in appropriate regulations. “As used herein, ‘workers’ refers to those who derive their livelihood chiefly from the rendition of work or services in exchange for compensation, which shall include members of a workers’ cooperative performing a job, task or duty for a person, corporation, association, entity or institution.”
The proposed amendments will take cognizance of the evolving nature of the employer-employee relationship that has to respond to the needs of global competitiveness and the increasing sophistication and education of workers in the Philippines. For those interested in a concrete model of a workers’ cooperative that already has 34,000 workers-owners and services some 200 businesses in the Philippines engaged in agribusiness; merchandising and quick service; auxiliary, property and other institutions; manufacturing and special projects; logistics; and telecommunications, access the website of Asiapro-Cooperatives, www.asiapro.coop.
For comments, my e-mail address is bernardo.villegas@uap.asia.
http://bit.ly/rFzgMO
Friday, November 18, 2011
MOA on incentive program for cooperative banks signed
Friday, November 18, 2011
A MEMORANDUM of agreement (MOA) to strengthen the program for cooperative banks (SPCB) was signed the other day to formally launch the incentive scheme designed to support the development of a stronger cooperative banking sector.
The MOA was signed between and among the Philippine Deposit Insurance Corporation, the Bangko Sentral ng Pilipinas and the Land Bank of the Philippines.
The SPCB aims to encourage mergers, consolidations and acquisitions of cooperative banks (CBs) by eligible strategic third party investors (STPIs) and will give financial incentives and assistance to cooperative banks and their partner STPIs “through a combination of preferred shares and direct loan to strengthen the cooperative bank’s capital position.”
The SPCB, which will run until August 2012, has two components: capital augmentation component and regulatory relief package.
For the capital augmentation component, “equity infusions will come from PDIC and LBP to bring the capital adequacy ratio of the surviving cooperative bank to the required regulatory level. The BSP, on the other hand, will make available the regulatory relief package to allow the surviving cooperative bank to achieve economies of scale and better manage their liabilities.”
Financial assistance will likewise be made available by LBP to qualified participating cooperative banks.
Eligible STPIs may be CBs, thrift banks, rural banks, primary cooperatives or federations of cooperatives. “Where the STPI is either a TB or RB, the bank should also be at least 67 percent owned by CBs, primary cooperatives and/or federation cooperatives.”
“In case the STPIs are primary cooperatives or federations of cooperatives, a certification or endorsement of good standing from the Cooperative Development Authority will be required in addition to a proven good track record based on their audited financial statements.”
Through the SPCB, surviving banks are expected to have an improved capital position with a net worth of at least P100 million and a minimum risk-based capital adequacy ratio (RBCAR) of 15 percent. Surviving banks should be CBs or thrift banks or rural banks at least 67 percent owned by cooperatives. (CGC)
A MEMORANDUM of agreement (MOA) to strengthen the program for cooperative banks (SPCB) was signed the other day to formally launch the incentive scheme designed to support the development of a stronger cooperative banking sector.
The MOA was signed between and among the Philippine Deposit Insurance Corporation, the Bangko Sentral ng Pilipinas and the Land Bank of the Philippines.
The SPCB aims to encourage mergers, consolidations and acquisitions of cooperative banks (CBs) by eligible strategic third party investors (STPIs) and will give financial incentives and assistance to cooperative banks and their partner STPIs “through a combination of preferred shares and direct loan to strengthen the cooperative bank’s capital position.”
The SPCB, which will run until August 2012, has two components: capital augmentation component and regulatory relief package.
For the capital augmentation component, “equity infusions will come from PDIC and LBP to bring the capital adequacy ratio of the surviving cooperative bank to the required regulatory level. The BSP, on the other hand, will make available the regulatory relief package to allow the surviving cooperative bank to achieve economies of scale and better manage their liabilities.”
Financial assistance will likewise be made available by LBP to qualified participating cooperative banks.
Eligible STPIs may be CBs, thrift banks, rural banks, primary cooperatives or federations of cooperatives. “Where the STPI is either a TB or RB, the bank should also be at least 67 percent owned by CBs, primary cooperatives and/or federation cooperatives.”
“In case the STPIs are primary cooperatives or federations of cooperatives, a certification or endorsement of good standing from the Cooperative Development Authority will be required in addition to a proven good track record based on their audited financial statements.”
Through the SPCB, surviving banks are expected to have an improved capital position with a net worth of at least P100 million and a minimum risk-based capital adequacy ratio (RBCAR) of 15 percent. Surviving banks should be CBs or thrift banks or rural banks at least 67 percent owned by cooperatives. (CGC)
Monday, November 14, 2011
Coop top exec backs up water district's conversion
Friday, November 11, 2011
FORMER senator Butch Aquino, who chairs the Philippine Coop Center (PCC), expressed support on the move to convert the Cagayan de Oro Water District (COWD) into a cooperative.
Aquino, who guests the National Peace Forum at the Lim Ket Kai Atrium in Cagayan de Oro Friday, said placing COWD under the umbrella of the Cooperative Development Authority (CDA) would mean advantageous to the water consumers.
COWD is currently under the supervision of the Local Water Utilities Administration (LWUA) -- with organizational structure does not recommend rights of the consumers to avail dividends and right of the general assembly to appoint a general manager and board officials.
It was also learned that COWD board officials or the LWUA can appoint a general manager to man the water provider. The city or town mayor appoints the board chairman and board officials.
In a press conference held during the CDA-Northern Mindanao-hosted forum, Aquino emphasized the need of COWD's conversion, as water rates are possibly regulated and controlled by the general assembly and not directly "maneuvered" by the management and the board officials for "personal gains."
Should the move succeed, Aquino suggested that the First Community Cooperative (Ficco) may take over the operation of the COWD.
With almost P4.59 billion in assets, Ficco, he added, is a well established and a stable cooperative that could effectively run the general operation of the COWD including the technical aspect and the regulation of water rates.
Supposing COWD is already converted, he said, the water provider's customers enjoy lower charges due to the cooperative's privilege on tax exemption that would bring in collection surplus which will then be scheduled to be returned to the consumers in the form of patronage refund. (Nicole J. Managbanag/Loui S. Maliza)
FORMER senator Butch Aquino, who chairs the Philippine Coop Center (PCC), expressed support on the move to convert the Cagayan de Oro Water District (COWD) into a cooperative.
Aquino, who guests the National Peace Forum at the Lim Ket Kai Atrium in Cagayan de Oro Friday, said placing COWD under the umbrella of the Cooperative Development Authority (CDA) would mean advantageous to the water consumers.
COWD is currently under the supervision of the Local Water Utilities Administration (LWUA) -- with organizational structure does not recommend rights of the consumers to avail dividends and right of the general assembly to appoint a general manager and board officials.
It was also learned that COWD board officials or the LWUA can appoint a general manager to man the water provider. The city or town mayor appoints the board chairman and board officials.
In a press conference held during the CDA-Northern Mindanao-hosted forum, Aquino emphasized the need of COWD's conversion, as water rates are possibly regulated and controlled by the general assembly and not directly "maneuvered" by the management and the board officials for "personal gains."
Should the move succeed, Aquino suggested that the First Community Cooperative (Ficco) may take over the operation of the COWD.
With almost P4.59 billion in assets, Ficco, he added, is a well established and a stable cooperative that could effectively run the general operation of the COWD including the technical aspect and the regulation of water rates.
Supposing COWD is already converted, he said, the water provider's customers enjoy lower charges due to the cooperative's privilege on tax exemption that would bring in collection surplus which will then be scheduled to be returned to the consumers in the form of patronage refund. (Nicole J. Managbanag/Loui S. Maliza)
Coop forum set Nov. 11
By Nicole J. Managbanag
Thursday, November 10, 2011THE biggest gathering of cooperative leaders is happening today, November 11, as the Cooperative Development Authority (CDA) in Northern Mindanao hosts the 2nd National Cooperative Peace Forum at the Lim Ket Kai Atrium in Cagayan de Oro.
CDA regional director Orlando Ravanera said the forum is expected to be attended by no less than 5,000 cooperative leaders from across the country to gather with local government unit officials, lumads, Muslim leaders, academe and civic organizations with topics centered on achieving peace in the whole country.
Ravanera said this forum will eventually become part in advancing the crusade to exemplify “cooperativism”.
He said cooperativism can level up to tasks of becoming not only an instrument of social justice, empowerment and development but likewise a vehicle for peace building to address the root causes of war—poverty and social injustice.
“As we take a step to peace building through cooperativism, this gathering of the kindred will showcase the raizon d’ etre of cooperativism especially in Mindanao, an island that can be aptly described as a land of paradox and contradiction,” he said.
During the whole day forum, a presentation from the topnotch resource persons will be presented to discuss the nine paths to peace—Peace through sustainable agriculture; Peace through Protection, Rehabilitation, conservation and Preferential Use Rights of Natural Resources; Peace through rights-based management of utilities; Peace through Human Resource Development; Peace through Human Resource Development; Peace through conflict Transformation, Management and Resolution; Peace through International Cooperation and Integration of Foreign Peace-making initiatives; and Peace through recognition and acceptance of cultural diversity and integrity.
http://bit.ly/vj0elA
Second coop market opens at Lumbia airport
By Nicole J. Managbanag
Thursday, November 10, 2011THE Cooperative Development Authority (CDA) in Northern Mindanao formally opened Wednesday its second “bagsakan” or trading center for registered cooperatives at Lumbia airport in Barangay Lumbia, here.
CDA regional director Orlando Ravanera said the second branch CDA-run “pasalubong” center called Cooperative Market eases transients to access locally made products which foodstuffs are produced by cooperatives.
The second branch has coffee shop funded through effort of Abamin party-list representative Maxi Rodriguez and Ating Koop party-list.
Ravanera noted the success of the main Cooperative Market at Manresa in Upper Carmen prompting the CDA-Northern Mindanao to open up another store that is more visible and accessible to tourists.
He said the cooperative market is a paradigm shift in promoting organically grown products from 37 cooperatives in Northern Mindanao.
Among the products available at the market are organic rice and vegetables, coconut sugar, vermicast fertilizer, vinegar, Yacun, tea syrup, fresh milk, pasalubong products, ornamental plants, abaca fibers, slippers, hangers and twines sold at reasonable prices.
“We develop this market because we are now shifting our program, from conventional to sustainable agriculture. It is now time to shape the farmers to be in control in the marketing of their products. With the help of the cooperative market, we are now helping them sell to local and international buyers,” he said.
Ravanera said the people have been “brainwashed too much by foreign advertisements,” pushing them to go abroad and patronize foreign products.
“A country that is not producing will always be penalized to be poor. We are now considered the 15th poorest country since we are a dumping ground for finished products from other countries,” he added.
He said when people buy the products from cooperatives “they are supporting the livelihood of the poor.”
“This is the start of what you call the spring board of a cooperative market that will be established in the region. The cooperatives are now ready to present their products, which are of high quality and globally competitive. At least, the farmers can now look forward to a place where they can deliver their produce,” the regional cooperative agency regional head said urging more cooperatives to join the cooperative market.
“All are welcome to sell at the market, even those who are not members of cooperatives as long as their products are locally made.”
During the opening, Rodriguez and Ating Koop party list Representative Isidro Lico witnessed the event.
In his speech, Rodriguez vowed further financial aid to establish more cooperative market branches not only in Northern Mindanao but the Mindanao region as well to help improve the lives of the farmers.
Wednesday, November 9, 2011
Prepaid metering system seen to bring down power rates
Posted on 09 Nov 2011 at 1:13pm
More than a million member-consumers of electric cooperatives that are registered with the Cooperative Development Authority (CDA) will soon enjoy lower electricity rates with the implementation of the country’s first-ever prepaid metering program next year.
The CDA-registered electric coops, represented by Rep. Ponciano Payuyo (3rd from left in photo) of the Association of Philippine Electric Cooperatives (APEC), foresee at least a 50 centavo-per kilowatt hour drop in their current electric bills or about P50 per 100 kilowatt hours and P250 per 500 kwh for household consumers and P1,000 for commercial and industrial consumers of 2,000 kwh per month.
Payuyo and IT expert Dante Mara (right) yesterday met with Land Bank president and CEO Gilda Pico (2nd from left) and LBP Executive Vice President Willie Maldia (left) to discuss how Land Bank can provide funding assistance to the sector to bring down high power rates.
Under the prepaid metering scheme which is similar to the prepaid cellphone system, electric consumers will buy prepaid cards from their electric cooperatives and load the card values into the electric meter in order to turn on the supply of electricity for the number of hours they intend to use it.
Payuyo said household members who leave the house in the morning for school or office may choose not to load their prepaid cards when nobody is at home and load the prepaid card only upon their arrival from school, office or elsewhere.
“This will reduce system losses as it will prevent the pilferage of electricity, reduce electricity consumption, develop a culture of thrift and result in monthly savings from the lower electricity rates,” Payuyo explained.
He said it will also keep household members alert and vigilant against illegal electricity connections by neighbors because their prepaid cards are only good and limited for their households’ consumption.
Aside from these, Payuyo said the shift to prepaid metering will reduce the accounting and collection costs of the electric cooperatives since there would be no need for meter readers, collectors and accounting personnel. This cost reduction also translates to savings for the electric cooperatives which would be passed on to their member-consumers every month.
Payuyo said the prepaid metering scheme will be pilot-tested next year in Puerto Princesa City, Palawan through the Palawan Electric Cooperative (Paleco) where he served as General Manager for 16 years.
He said the savings to be generated from the prepaid metering system could also be used to fund other programs for Paleco members, such as a bulk-buying system for petroleum products such as gasoline, diesel and kerosene or the bulk-buying of food and non-food items, including groceries, with big discounts.
Meanwhile, Mrs. Pico said Land Bank supports the effort to bring down the regime of high electricity rates especially among cooperative members who constitiute Land Bank’s primary beneficiary base. Pico designated Maldia as LBP’s lead person for the program.
http://bit.ly/tn0VZ5
More than a million member-consumers of electric cooperatives that are registered with the Cooperative Development Authority (CDA) will soon enjoy lower electricity rates with the implementation of the country’s first-ever prepaid metering program next year.
The CDA-registered electric coops, represented by Rep. Ponciano Payuyo (3rd from left in photo) of the Association of Philippine Electric Cooperatives (APEC), foresee at least a 50 centavo-per kilowatt hour drop in their current electric bills or about P50 per 100 kilowatt hours and P250 per 500 kwh for household consumers and P1,000 for commercial and industrial consumers of 2,000 kwh per month.
Payuyo and IT expert Dante Mara (right) yesterday met with Land Bank president and CEO Gilda Pico (2nd from left) and LBP Executive Vice President Willie Maldia (left) to discuss how Land Bank can provide funding assistance to the sector to bring down high power rates.
Under the prepaid metering scheme which is similar to the prepaid cellphone system, electric consumers will buy prepaid cards from their electric cooperatives and load the card values into the electric meter in order to turn on the supply of electricity for the number of hours they intend to use it.
Payuyo said household members who leave the house in the morning for school or office may choose not to load their prepaid cards when nobody is at home and load the prepaid card only upon their arrival from school, office or elsewhere.
“This will reduce system losses as it will prevent the pilferage of electricity, reduce electricity consumption, develop a culture of thrift and result in monthly savings from the lower electricity rates,” Payuyo explained.
He said it will also keep household members alert and vigilant against illegal electricity connections by neighbors because their prepaid cards are only good and limited for their households’ consumption.
Aside from these, Payuyo said the shift to prepaid metering will reduce the accounting and collection costs of the electric cooperatives since there would be no need for meter readers, collectors and accounting personnel. This cost reduction also translates to savings for the electric cooperatives which would be passed on to their member-consumers every month.
Payuyo said the prepaid metering scheme will be pilot-tested next year in Puerto Princesa City, Palawan through the Palawan Electric Cooperative (Paleco) where he served as General Manager for 16 years.
He said the savings to be generated from the prepaid metering system could also be used to fund other programs for Paleco members, such as a bulk-buying system for petroleum products such as gasoline, diesel and kerosene or the bulk-buying of food and non-food items, including groceries, with big discounts.
Meanwhile, Mrs. Pico said Land Bank supports the effort to bring down the regime of high electricity rates especially among cooperative members who constitiute Land Bank’s primary beneficiary base. Pico designated Maldia as LBP’s lead person for the program.
http://bit.ly/tn0VZ5
CDA presses conversion of coops
Wednesday, November 9, 2011
LA TRINIDAD, Benguet - Conversion of electric cooperatives to stock cooperatives will have many advantages to its consumer members and to the cooperative as well, Ating Koop party-list Representative Isidro Lico said.
Lico said, during the Regional Cooperative Month held last week at the Benguet State University, registration of electric cooperatives to Cooperative Development Authority (CDA) as stock cooperative is one of their primary advocacies, as it has many advantages for the member-consumers and the electric cooperative.
Lico said CDA-registered cooperatives are exempted of the 12 percent value-added tax (VAT) which would eventually result to the reduction of electric rates for the consumers.
Lico said the conversion of electric cooperatives into stock coop would also give recognition to consumers as co-owner of the cooperative.
In the present set-up, consumers are not considered as such because there is no record of ownership and how much the consumers are contributing. (Lito Dar)
http://bit.ly/w4tRjx
LA TRINIDAD, Benguet - Conversion of electric cooperatives to stock cooperatives will have many advantages to its consumer members and to the cooperative as well, Ating Koop party-list Representative Isidro Lico said.
Lico said, during the Regional Cooperative Month held last week at the Benguet State University, registration of electric cooperatives to Cooperative Development Authority (CDA) as stock cooperative is one of their primary advocacies, as it has many advantages for the member-consumers and the electric cooperative.
Lico said CDA-registered cooperatives are exempted of the 12 percent value-added tax (VAT) which would eventually result to the reduction of electric rates for the consumers.
Lico said the conversion of electric cooperatives into stock coop would also give recognition to consumers as co-owner of the cooperative.
In the present set-up, consumers are not considered as such because there is no record of ownership and how much the consumers are contributing. (Lito Dar)
http://bit.ly/w4tRjx
King Coop eyes P1-B in assets
King Cooperative, one of the biggest coopreratives in the city
in terms of membership at 32,000, is targeting to grow its assets to P1
billion within the next three years from P750 million at present.
The cooperative is looking at increasing its membership to 40,000 within the period to hit its goal, said Nestor D. Ortigoza, its general manager.
“There is still a big untapped market,” Ortigoza told the TIMES, pointing out that the cooperative has started strengthening its campaign to increase its members so it would be able to reach its goal.
He said the cooperative, which already has 27 branches in urban centers in Mindanao, is studying to expand in some strategic areas within the island as it wanted to set up 13 more branches within the next five years.
But the cooperative will ensure that only “quality members” will be the ones to get accepted. “We will make sure that as we grow our cooperatives, our members will also grow with it,” Ortigoza added.
Engr. Jaime G. Adalin Jr., acting head of the City Cooperative and Development Office, earlier said that in the city alone, there are still a very big market for cooperatives. “We hope that within the next two years we will be able to achieve the 300,000 membership mark,” he earlier said.
Based on the record of the regional office of the Cooperative Development Authority, the city has about 204,000 residents who are members of cooperatives. The city has about 1.46 million population in 2010 based on the city government official estimates.
Ortigoza said that if the 30-year old cooperative, which started at the office of the Department of Agriculture, could breach the P1 billion mark in terms of assets, it could grow its assets to as big as P3 billion two years after achieving the first target. “It is easier to grow bigger when you have hit the P1 billion club because you already have a history (of being a well-managed cooperative),” he said.
Adalin said that many cooperatives were not able to sustain their operations because of mismanagement.
Unlike those that closed down their operations, the King Cooperative has been able to thrive because it has made sure that all members of its management team are “qualified and capable of being managers,” Ortigoza said.
The cooperative is also venturing into businesses other than lending in its efforts to increase its profitability.
Next month, it will pilot test its agreement with a remittance company, Western Union so it could start its remittance business as agent of the company. It will put up five remittance centers in key areas, but some branch managers outside of the five branches where these centers will be set up already wanted their branches to be included in the business model, Mr. Ortigoza added.
The cooperative is also finalizing its agreement with the city-based petroleum company, Phoenix Petroleum Philippines, for the setting up of its first gasoline station in Digos City, Davao del Sur.
It is also studying the proposal to offer insurance coverages to its members. “We are finalizing this idea so that we can also offer a product that our members also need,” Ortigoza added.
He said the management has decided to come up with new business models other than lending so it could also grow faster than traditional cooperatives. “In the past, growing a cooperative was slower as members (of the board of directors) were conservative. They thought then that investments other than lending were risky,” he explained.
http://bit.ly/tLmSlE
The cooperative is looking at increasing its membership to 40,000 within the period to hit its goal, said Nestor D. Ortigoza, its general manager.
“There is still a big untapped market,” Ortigoza told the TIMES, pointing out that the cooperative has started strengthening its campaign to increase its members so it would be able to reach its goal.
He said the cooperative, which already has 27 branches in urban centers in Mindanao, is studying to expand in some strategic areas within the island as it wanted to set up 13 more branches within the next five years.
But the cooperative will ensure that only “quality members” will be the ones to get accepted. “We will make sure that as we grow our cooperatives, our members will also grow with it,” Ortigoza added.
Engr. Jaime G. Adalin Jr., acting head of the City Cooperative and Development Office, earlier said that in the city alone, there are still a very big market for cooperatives. “We hope that within the next two years we will be able to achieve the 300,000 membership mark,” he earlier said.
Based on the record of the regional office of the Cooperative Development Authority, the city has about 204,000 residents who are members of cooperatives. The city has about 1.46 million population in 2010 based on the city government official estimates.
Ortigoza said that if the 30-year old cooperative, which started at the office of the Department of Agriculture, could breach the P1 billion mark in terms of assets, it could grow its assets to as big as P3 billion two years after achieving the first target. “It is easier to grow bigger when you have hit the P1 billion club because you already have a history (of being a well-managed cooperative),” he said.
Adalin said that many cooperatives were not able to sustain their operations because of mismanagement.
Unlike those that closed down their operations, the King Cooperative has been able to thrive because it has made sure that all members of its management team are “qualified and capable of being managers,” Ortigoza said.
The cooperative is also venturing into businesses other than lending in its efforts to increase its profitability.
Next month, it will pilot test its agreement with a remittance company, Western Union so it could start its remittance business as agent of the company. It will put up five remittance centers in key areas, but some branch managers outside of the five branches where these centers will be set up already wanted their branches to be included in the business model, Mr. Ortigoza added.
The cooperative is also finalizing its agreement with the city-based petroleum company, Phoenix Petroleum Philippines, for the setting up of its first gasoline station in Digos City, Davao del Sur.
It is also studying the proposal to offer insurance coverages to its members. “We are finalizing this idea so that we can also offer a product that our members also need,” Ortigoza added.
He said the management has decided to come up with new business models other than lending so it could also grow faster than traditional cooperatives. “In the past, growing a cooperative was slower as members (of the board of directors) were conservative. They thought then that investments other than lending were risky,” he explained.
http://bit.ly/tLmSlE
Saturday, November 5, 2011
CDA targets expansion of cooperative membership
Friday, November 4, 2011
THE Cooperative Development Authority (CDA) in Northern Mindanao is planning for massive expansion of cooperative membership in the province of Misamis Occidental.
Lawyer Paisalin Tago, CDA administrator for Mindanao, said one of the agenda of the cooperative agency is to increase the membership to 20 million by 2013 from current membership of more than seven million.
He said the CDA is encouraging cooperatives to register, again, as mandated by Republic Act 9520, citing the present 20,000 registered cooperatives is much lower compared to the more than 90,000 registered cooperatives before the enactment of the new cooperative code.
One of the speakers during the recent second provincial cooperative congress held at the Social Hall of the Provincial Capitol, Tago emphasized that putting up a cooperative is a solution to minimize poverty, reduce unemployment, and promote peace and order.
He also disclosed that they are eyeing conversion of the so-called electric cooperatives (ECs) into genuine cooperatives as a strategy to increase membership.
Under RA 9520, ECs cannot enjoy the privilege of tax exemption unless they are registered with the CDA and registering will mean the member-consumers of ECs will then and there become cooperative members.
Aside from the expansion in membership, the CDA will also boost and enhance its delivery mechanism and provide an enabling environment for the strengthening and development of cooperatives in the country.
As provided in the Philippine Cooperative Medium-Term Development Plan for 2011-2016, the CDA will ensure access of cooperatives to global markets, provide viable linkages and networks to support cooperatives and establish appropriate quality system.
It also creates the appropriate environment for partnership among cooperatives, both local and international, local government units, national line agencies, non-government organizations, people’s organizations, and the private sector.
Such policies will ensure viable, competitive and sustainable cooperatives as engine of growth and development, Tago said. (PR)
http://bit.ly/vIv4AQ
THE Cooperative Development Authority (CDA) in Northern Mindanao is planning for massive expansion of cooperative membership in the province of Misamis Occidental.
Lawyer Paisalin Tago, CDA administrator for Mindanao, said one of the agenda of the cooperative agency is to increase the membership to 20 million by 2013 from current membership of more than seven million.
He said the CDA is encouraging cooperatives to register, again, as mandated by Republic Act 9520, citing the present 20,000 registered cooperatives is much lower compared to the more than 90,000 registered cooperatives before the enactment of the new cooperative code.
One of the speakers during the recent second provincial cooperative congress held at the Social Hall of the Provincial Capitol, Tago emphasized that putting up a cooperative is a solution to minimize poverty, reduce unemployment, and promote peace and order.
He also disclosed that they are eyeing conversion of the so-called electric cooperatives (ECs) into genuine cooperatives as a strategy to increase membership.
Under RA 9520, ECs cannot enjoy the privilege of tax exemption unless they are registered with the CDA and registering will mean the member-consumers of ECs will then and there become cooperative members.
Aside from the expansion in membership, the CDA will also boost and enhance its delivery mechanism and provide an enabling environment for the strengthening and development of cooperatives in the country.
As provided in the Philippine Cooperative Medium-Term Development Plan for 2011-2016, the CDA will ensure access of cooperatives to global markets, provide viable linkages and networks to support cooperatives and establish appropriate quality system.
It also creates the appropriate environment for partnership among cooperatives, both local and international, local government units, national line agencies, non-government organizations, people’s organizations, and the private sector.
Such policies will ensure viable, competitive and sustainable cooperatives as engine of growth and development, Tago said. (PR)
http://bit.ly/vIv4AQ
5,000 to gather for 2nd national coop peace forum
By Cong Corrales |
CAGAYAN DE ORO CITY (MindaNews/4 Nov) – Some 5,000 cooperative leaders representing 20,178 cooperatives nationwide are set to gather in this city for the 2nd National Cooperative Peace Forum, an official of the Cooperative Development Authority (CDA) said Thursday.Dubbed as “11.11.11,” the “convergence will see the coming together of 5,000 coop leaders from all over the country with stakeholders representing the local government units, NGOs, lumads, Muslims, academe and the civic organizations to bring to all and sundry the cooperative declaration for peace,” said Orland Ravanera, CDA regional director for Northern Mindanao.
“The final solution of war is peace building. If we collectively uproot the causes of war then insurgency would lose its relevance to those who have been victims of social injustice, deficiency in governance,” Ravanera said in an interview.
He added that “cooperative as a paradigm for achieving social justice is the best vehicle towards peace building.”
Carrying the theme “Advancing the essence of peace through cooperativism,” the forum is scheduled on November 11 at the atrium of LimKetKai Mall in this city.
Ravanera noted that the issues of the poor usually don’t get people’s attention. “This forum will give space for them,” Ravanera said.
The forum will tackle the cooperatives’ “nine paths to peace,” which is attaining peace through 1) sustainable agriculture; 2) protection, rehabilitation and preferential use of natural resources; 3) rights-based management of utilities; 4) good governance and people empowerment; 5) human resource development; 6) conflict transformation, management and resolution; 7) promotion of Halal food; 8 international cooperation and integration of foreign peace-making initiatives; and 9) recognition and acceptance of cultural diversity and integrity.
Philippine Cooperative Center chair Agapito “Butz” Aquino is slated to give the general synthesis in the context of cooperativism after the presentations.
“We are inviting you to take part in advancing the crusade to exemplify that cooperativism can be up to the task of becoming not only an instrument of social justice, empowerment and development but also a vehicle for peace-building to address the root causes of war, poverty and social injustices,” said Ravanera. (Cong B. Corrales / MindaNews)
http://bit.ly/s4RhJS
Monday, October 24, 2011
Co-op members need not be taxed
SC cites social justice in rendering decision
By: Ronnel W. DomingoPhilippine Daily Inquirer
2:06 am | Monday, October 24th, 2011
Cooperatives are not required to withhold taxes on interest from their members’ savings and time deposits, according to the Bureau of Internal Revenue.
According to Revenue Commissioner Kim S. Henares, this ruling still has to be affirmed and publicized following a Supreme Court decision issued in January 2010.
In Revenue Memorandum Circular No. 47-2011, Henares explained that,
based on the Supreme Court ruling, the savings and time deposits of
members of a cooperative are not subject to the 20-percent withholding tax.
The high court decided in favor of the Dumaguete Cathedral Credit
Cooperative, which the BIR in 2002 pursued for failing to withhold taxes
of its members.
Based on the BIR’s assessment, the DCCC owes the government P2.95 million—P1.49 million for 1999 and P1.46 million for 2000—in withholding taxes on interest earnings.
Although the DCCC protested the revenue assessment, the BIR failed to
act on the matter within the prescribed 180-day period. The cooperative
then brought the issue to the Court of Tax Appeals.
According to the Supreme Court, the tax code provides for the imposition of a 20-percent final (withholding) tax on interest from bank deposit as well as earnings from deposit substitutes, trust funds and similar arrangements.
But in its ruling, the high tribunal did not consider savings and time deposits in cooperatives as subject to withholding tax.
In fact, the high court said, this interpretation of the tax code is contained in a BIR ruling issued in 1998 and again in another ruling issued in 2006.
“Petitioner’s invocation [of these two BIR rulings] is proper,” the Supreme Court said.
“The Constitution states that the promotion of social justice shall include the commitment to create economic opportunities based on freedom of initiative and self-reliance. We find that an interpretation exempting members of cooperatives [from the withholding tax] is more in keeping with the letter and spirit of our Constitution.”
http://business.inquirer.net/26505/co-op-members-need-not-be-taxed
Co-ops to fuel economy
By Malou Guanzon-Apalisok
Cebu Daily News
8:42 am | Thursday, October 20th, 2011
The 1st Central Visayas Co-op Solidarity Council conference reels off today at the Waterfront Cebu City Hotel and Casino in barangay Lahug, a three-day activity that brings together more than 700 coop leaders from all over the central islands.
The CVCSC meet will also kick off the 2012 International Year of Cooperatives, a United Nations-sponsored observance that aims to highlight the contribution of the sector to global socioeconomic development, particularly its impact on poverty reduction, employment generation and social integration. The International Cooperative Alliance is the main driver of this celebration and in the Philippines the Central Visayas co-ops are firing the opening salvo.
The business of cooperatives does not generate the kind of excitement that usually goes with corporate events that feature celebrities and loads of freebies, but if you happen to interact with the cooperative sector nowadays, you could sense an excitement that comes only with big and significant developments never before experienced by the movement in the Philippines.
I’m talking about the thrust of President Noynoy Aquino in turning to co-op concepts and experts in crafting and implementing his administration’s poverty reduction programs.
I recall that in the Asian Institute of Management policy conference “Pathways to High and Inclusive Growth” last Sept. 23, National Anti-Poverty Commission lead convenor Joel Rocamora mentioned the co-ops as a critical link in poverty reduction strategies because of its proven track record.
Early this week, President Aquino issued Administrative Order 21, which set specific criteria in the selection of sectoral representatives who could participate in the assemblies of NAPC. The National Sectoral Assembly (NSA) cuts across 1,300 basic sector organizations from all over the country. Considered the most vulnerable to poverty are “artisans, fisher folk, children, farmers, indigenous peoples, nongovernment organizations, persons with disabilities, senior citizens, urban poor, victims of disasters, women, political parties, formal labor and migrant workers, workers in the informal sector, youth and students.”
I’m happy to report that one of those who made it to National Sectoral Assembly (NSA) is Mercedes “Ched” Castillo, chief executive officer of Victo National, a cooperative training and development center based in Cebu City. In the NAPC’s perspective, the co-op has a mandate not just to further strengthen affiliates but to diffuse the benefits of the co-op system by bringing in it the poorest of the poor communities.
The synergy in this partnership fuels the excitement of co-ops nationwide. Government infrastructure coupled with resources to the tune of P39 billion in conditional cash transfers
next year can be both daunting and exhilarating. However, if VICTO
National was able to set up 50 co-ops in war-ravaged Afghanistan years
back, why not in the Philippines?
As of June 10, 2010, there are 15,458 registered cooperatives nationwide with combined membership of 6,778,037, P163.01 billion in total assets and P186.07 billion in authorized capital. Of these, P58.25 billion is subscribed and P34.08 billion is paid, says the state regulatory body Cooperative Development Authority (CDA).
By the way, part of the CVCSC activity today is a press conference at 2 p.m., at Waterfront Hotel in
Lahug. Co-op movers and shakers like former senator and congressman
Agapito “Butz” Aquino, chairman of the Philippine Cooperative Center;
Cebu Congressman Pablo Garcia; party-list representatives as well as CDA
execs led by board chairman Emmanuel Santiaguel and many others are
expected to attend.
http://bit.ly/pH1Ufu
Cebu Daily News
8:42 am | Thursday, October 20th, 2011
The 1st Central Visayas Co-op Solidarity Council conference reels off today at the Waterfront Cebu City Hotel and Casino in barangay Lahug, a three-day activity that brings together more than 700 coop leaders from all over the central islands.
The CVCSC meet will also kick off the 2012 International Year of Cooperatives, a United Nations-sponsored observance that aims to highlight the contribution of the sector to global socioeconomic development, particularly its impact on poverty reduction, employment generation and social integration. The International Cooperative Alliance is the main driver of this celebration and in the Philippines the Central Visayas co-ops are firing the opening salvo.
The business of cooperatives does not generate the kind of excitement that usually goes with corporate events that feature celebrities and loads of freebies, but if you happen to interact with the cooperative sector nowadays, you could sense an excitement that comes only with big and significant developments never before experienced by the movement in the Philippines.
I’m talking about the thrust of President Noynoy Aquino in turning to co-op concepts and experts in crafting and implementing his administration’s poverty reduction programs.
I recall that in the Asian Institute of Management policy conference “Pathways to High and Inclusive Growth” last Sept. 23, National Anti-Poverty Commission lead convenor Joel Rocamora mentioned the co-ops as a critical link in poverty reduction strategies because of its proven track record.
Early this week, President Aquino issued Administrative Order 21, which set specific criteria in the selection of sectoral representatives who could participate in the assemblies of NAPC. The National Sectoral Assembly (NSA) cuts across 1,300 basic sector organizations from all over the country. Considered the most vulnerable to poverty are “artisans, fisher folk, children, farmers, indigenous peoples, nongovernment organizations, persons with disabilities, senior citizens, urban poor, victims of disasters, women, political parties, formal labor and migrant workers, workers in the informal sector, youth and students.”
I’m happy to report that one of those who made it to National Sectoral Assembly (NSA) is Mercedes “Ched” Castillo, chief executive officer of Victo National, a cooperative training and development center based in Cebu City. In the NAPC’s perspective, the co-op has a mandate not just to further strengthen affiliates but to diffuse the benefits of the co-op system by bringing in it the poorest of the poor communities.
Political observers note that by issuing A.O. 21, the President
returned to the people the power to select their representatives in the
lead agency tasked to reduce if not purge poverty. It has been reported
that in previous years, many civil society groups were excluded from
joining the NAPC because of their critical stance to the previous
administration. The disenfranchisement of the basic sectors from the
process of looking for viable solutions to the problem of poverty has
politicized the agency and further marginalized those who live in the
fringes of society.
As of June 10, 2010, there are 15,458 registered cooperatives nationwide with combined membership of 6,778,037, P163.01 billion in total assets and P186.07 billion in authorized capital. Of these, P58.25 billion is subscribed and P34.08 billion is paid, says the state regulatory body Cooperative Development Authority (CDA).
The work of the cooperatives and the logistical support of the government
would look like a partnership made in heaven. However, I heard that
some co-ops are unhappy with too much regulation. There are reports that
some elements in the CDA are making it difficult for co-ops to perform
well, so some quarters are demanding self-regulation.
I think P-Noy should look closely at the workings of the CDA. His
centerpiece anti-poverty program cannot be compromised by government
officials who persist in their wang-wang mentality.
http://bit.ly/pH1Ufu
CDA urges power coops to register
By Elias O. Baquero
Friday, October 21, 2011FOR their power rates to be tax-free, consumers should register their electric cooperatives with the Cooperative Development Authority (CDA).
This way, they become the real owners of their cooperatives and receive annual dividends.
This was the advice of CDA Executive Director Orlando Ravanera in a press conference yesterday.
He said electric cooperatives are cooperatives only in name and do not operate in a way that empowers the consumers and members.
Instead of being managed by the members, which is the principle of cooperativism, electric cooperatives are controlled by a few influential people, he said.
Former senator Agapito Aquino of the Philippine Cooperative Center said that because power is a service sector, electric cooperatives should be owned by the members and should be supervised and guided by CDA.
The electric cooperatives are supervised by the National Electrification Administration (NEA).
The electric cooperatives in Cebu are the Cebu Electric Cooperative (Cebeco) 1, Cebeco 2, Cebeco 3, Bantayan Electric Cooperative (Banelco) and the Camotes Island Electric Cooperative.
In Bohol, power distribution is undertaken by the Bohol Electric Cooperative (Boheco) 1 and Boheco 2, which are also run by businessmen.
Aquino said electric cooperatives should register with the CDA because while consumers appear to own the power utilities, they do not manage them.
In a press conference for the First Visayas Cooperative Congress at the Waterfront Cebu City Hotel yesterday, Ravanera urged power consumers to decide not to operate their electric cooperatives as private corporations.
He also said electric cooperatives should open their books of accounts to their members who are power consumers.
CDA 7 Director Alexander Patac said Republic Act 9520 or the Philippine Cooperative Code of 2008 gives electric cooperatives the option to register with the CDA, or with the Securities and Exchange Commission (SEC) as a private corporation.
If they choose to register with SEC, Patac said the electric cooperatives will become profit-oriented. They will also be required by the Bureau of Internal Revenue (BIR) to pay taxes, including the value-added tax (VAT), and as a consequence, power rates will increase.
But Concor Quisaot, assistant general manager for Cebeco 1, 2 and 3, disagreed.
“If they refer to tax exemption, they must consider that if sales of electric cooperatives are without VAT while its purchases have, the electric coop will be unable to recoup as its rate is on cash flow. It is disastrous and could lead to unimaginable inefficiency,” he said of proposals to register with the CDA, in a text message sent to Sun.Star Cebu.
In the press conference, Patac said RA 9520 mandates NEA to conduct a forum with the power consumers and inform them of their rights under the law.
NEA is also mandated to inform the power consumers of the advantages and disadvantages of registering with CDA or with SEC as a private corporation, after which, a referendum should be conducted.
The deadline for the registration of electric cooperatives with CDA is June 30, 2012.
Ravanera advised the consumers to work on the registration soon because the process takes time.
http://bit.ly/mSAseC
Coop confab kicks off
By Niña G. Sumacot/LPM
(The Freeman) Updated October 21, 2011 12:00 AM
CEBU, Philippines - The Central Visayas Coop Solidarity Council composed of coop federations and unions in the region kicked off the First Central Visayas Cooperative Congress at the Waterfront Lahug yesterday.
The three-day event is held in cooperation with the Cooperative Development Authority.
Over 200 primary cooperatives and 500 coop leaders gathered for the event.
Part of the event is the launching of 2012 as International Year of Cooperatives as declared by the United Nations to highlight the contribution of cooperatives to global socio-economic development.
With theme “Transformative cooperatives advancing the people, planet, prosperity and peace for sustainable development,” the event aims to increase public awareness about cooperatives and their contribution to development.
The event also aims to promote cooperatives and encourage government to establish policies conducive to their growth and stability.
Today, topics such as the conversion of electrical cooperatives, which are not registered under CDA, will be tackled.
Only cooperatives registered under CDA can enjoy tax exemption privileges.
CDA chairman Orlan Ravanera said members of the Cebu Electric Cooperative (CEBECO) I, II, and III, Bantayan Electric Cooperative (BANELCO), and Camotes Electric Cooperative (CENELCO) are at a loss on their part.
Ravanera said that under the Republic Act 9520, electrical cooperatives will be charged with an additional 12 percent value-added tax apart from the tax that they are paying to the government. (FREEMAN)
http://bit.ly/oqeWn8
CEBU, Philippines - The Central Visayas Coop Solidarity Council composed of coop federations and unions in the region kicked off the First Central Visayas Cooperative Congress at the Waterfront Lahug yesterday.
The three-day event is held in cooperation with the Cooperative Development Authority.
Over 200 primary cooperatives and 500 coop leaders gathered for the event.
Part of the event is the launching of 2012 as International Year of Cooperatives as declared by the United Nations to highlight the contribution of cooperatives to global socio-economic development.
With theme “Transformative cooperatives advancing the people, planet, prosperity and peace for sustainable development,” the event aims to increase public awareness about cooperatives and their contribution to development.
The event also aims to promote cooperatives and encourage government to establish policies conducive to their growth and stability.
Today, topics such as the conversion of electrical cooperatives, which are not registered under CDA, will be tackled.
Only cooperatives registered under CDA can enjoy tax exemption privileges.
CDA chairman Orlan Ravanera said members of the Cebu Electric Cooperative (CEBECO) I, II, and III, Bantayan Electric Cooperative (BANELCO), and Camotes Electric Cooperative (CENELCO) are at a loss on their part.
Ravanera said that under the Republic Act 9520, electrical cooperatives will be charged with an additional 12 percent value-added tax apart from the tax that they are paying to the government. (FREEMAN)
http://bit.ly/oqeWn8
Gov’t eyes expanded function for NEA
The government is moving to amend the charter of the National
Electrification Administration so that it may be able to provide
assistance to cooperatives that are independent of its supervision.
Energy Undersecretary Ina Magpale-Asirit told Malaya Business insight the charter amendment would allow NEA to provide technical and financial assistance even to cooperatives that are supervised by the Cooperative Development Authority (CDA).
"We want to establish a system where NEA can assist the cooperatives regardless of their nature," she said. "What we want to see is to enhance the capacity of NEA."
Electric cooperatives have the option to either be under the supervision of NEA or declare administrative independence by registering with the CDA.
Cooperatives must present evidence of financial and technical capacity to be independent before it can register with the CDA. CDA members are entitled to tax incentives, which could translate to lower power rates.
Out of the 119 electric cooperatives in the country, only nine are registered with the CDA and the rest are under the supervision of NEA.
http://bit.ly/ngtNpU
Energy Undersecretary Ina Magpale-Asirit told Malaya Business insight the charter amendment would allow NEA to provide technical and financial assistance even to cooperatives that are supervised by the Cooperative Development Authority (CDA).
"We want to establish a system where NEA can assist the cooperatives regardless of their nature," she said. "What we want to see is to enhance the capacity of NEA."
Electric cooperatives have the option to either be under the supervision of NEA or declare administrative independence by registering with the CDA.
Cooperatives must present evidence of financial and technical capacity to be independent before it can register with the CDA. CDA members are entitled to tax incentives, which could translate to lower power rates.
Out of the 119 electric cooperatives in the country, only nine are registered with the CDA and the rest are under the supervision of NEA.
http://bit.ly/ngtNpU
Sunday, October 23, 2011
Let CDA request BIR for exemption paper: Pabling
Monday, October 10, 2011
DEPUTY Speaker Pablo Garcia said the Cooperative Development Authority (CDA) should be the one to request a certificate of tax exemption (CPE) from the Bureau of Internal Revenue (BIR) as their service to the cooperatives.
The suggestion came after several cooperatives complained that they are having a hard time getting a certification from the BIR. This was the reason not all of the cooperatives got tax incentives despite the implementation of the law.
CDA 7 Director Alexander Patac said they are willing to do it and suggested that the implementing rules and regulations (IRR) be implemented.
Not subject to tax
Under the Cooperative Code, cooperatives dealing exclusively with members are not subject to any government taxes or fees imposed under the internal revenue laws and other tax laws. For national taxes, some of the tax exemptions cover income tax on earnings from operations and value-added tax.
BIR Commissioner Nelson Aspe said they have to review the IRR.
A forum conducted by the Senate and House Committees on Cooperatives was held last Oct. 6 at the Capitol Social Hall, which was attended by the various cooperatives from all over Central Visayas.
It was the ninth in a series of consultations organized all over the country. It was attended by Sen. Ferdinand Marcos, Jr., vice chairman of the committee on cooperatives, and Rep. Jose Ping-ay, chairman of the House committee of cooperatives.
Former senator Miguel Zubiri, who said the law was his brainchild, also attended the gathering as consultant of Sen. Manuel Lapid, the chairman of the Senate committee on cooperatives.
The discussion revolved around the difficulty of getting a CTE.
Lawyer Vivian Maquiling of the Dumaguete Private Cooperative said they have been “compliant and obedient” in complying with the requirements in getting a CTE but the BIR asked for documents beyond what are indicated in the law like a sworn statement from the cooperative.
She appealed to the BIR to stick to the documentary requirements in order to speed up processing of CTE.
Explanation
A BIR representative who facilitated Maquiling’s papers stood up and explained that she had asked for a sworn statement because the signatories of the cooperative differ.
Ping-ay interrupted and asked the BIR employee if she was aware that each year, officials of a cooperative change. He said this was the reason signatories vary.
Garcia said a simple exercise of common sense should have been done on the part of the BIR, which was to call and verify to the CDA where the cooperative of Maquiling belongs.
http://bit.ly/oKQeHI
DEPUTY Speaker Pablo Garcia said the Cooperative Development Authority (CDA) should be the one to request a certificate of tax exemption (CPE) from the Bureau of Internal Revenue (BIR) as their service to the cooperatives.
The suggestion came after several cooperatives complained that they are having a hard time getting a certification from the BIR. This was the reason not all of the cooperatives got tax incentives despite the implementation of the law.
CDA 7 Director Alexander Patac said they are willing to do it and suggested that the implementing rules and regulations (IRR) be implemented.
Not subject to tax
Under the Cooperative Code, cooperatives dealing exclusively with members are not subject to any government taxes or fees imposed under the internal revenue laws and other tax laws. For national taxes, some of the tax exemptions cover income tax on earnings from operations and value-added tax.
BIR Commissioner Nelson Aspe said they have to review the IRR.
A forum conducted by the Senate and House Committees on Cooperatives was held last Oct. 6 at the Capitol Social Hall, which was attended by the various cooperatives from all over Central Visayas.
It was the ninth in a series of consultations organized all over the country. It was attended by Sen. Ferdinand Marcos, Jr., vice chairman of the committee on cooperatives, and Rep. Jose Ping-ay, chairman of the House committee of cooperatives.
Former senator Miguel Zubiri, who said the law was his brainchild, also attended the gathering as consultant of Sen. Manuel Lapid, the chairman of the Senate committee on cooperatives.
The discussion revolved around the difficulty of getting a CTE.
Lawyer Vivian Maquiling of the Dumaguete Private Cooperative said they have been “compliant and obedient” in complying with the requirements in getting a CTE but the BIR asked for documents beyond what are indicated in the law like a sworn statement from the cooperative.
She appealed to the BIR to stick to the documentary requirements in order to speed up processing of CTE.
Explanation
A BIR representative who facilitated Maquiling’s papers stood up and explained that she had asked for a sworn statement because the signatories of the cooperative differ.
Ping-ay interrupted and asked the BIR employee if she was aware that each year, officials of a cooperative change. He said this was the reason signatories vary.
Garcia said a simple exercise of common sense should have been done on the part of the BIR, which was to call and verify to the CDA where the cooperative of Maquiling belongs.
http://bit.ly/oKQeHI
Coop bloc party listers want electric coops to hold referedum to determine ownership of P55-billion member-consumers capital contributions
By Mike Baños
The cooperative bloc of party list representatives in the Lower House has asked the Department of Energy to compel rural electric cooperatives (RECs) to call a referendum among their members to determine if they wish to become real cooperatives and register with the Cooperative Development Authority (CDA) with their consumers as equity owners.
The cooperative bloc of party list representatives in the Lower House has asked the Department of Energy to compel rural electric cooperatives (RECs) to call a referendum among their members to determine if they wish to become real cooperatives and register with the Cooperative Development Authority (CDA) with their consumers as equity owners.
“We
are asking DOE and the National Electrification Administration (NEA) to require
all rural electric cooperatives under their supervision to call a referendum
among their member-consumers for this purpose as provided by law,” said Rep.
Isidro Q. Lico (ATING-KOOP party list) at a program and subsequent press
conference Sunday to launch the Cooperative Month celebration in this city and
Northern Mindanao (Region X).
Ating Koop Party List Rep. Isidro Q. Lico speaks during the Oct. 2 launching program of Coop Month in Region X.
The cooperative block of party list groups – Coop-NATCCO, Agricultural Sector Alliance of the Philippines, Inc. (AGAP), BUTIL Farmers’ Party, 1st Consumers Alliance for Rural Energy Partylist (1-CARE)); 1- United Transport Koalisyon / 1-UTAK and Adhikaing Tinataguyod ng Kooperatiba (ATING-KOOP) represent marginalized sectors of society which comprise the majority of the country’s population. Eight party list representatives and at least 20 other congressmen have declared their support for the initiative, Mr. Lico added.
However,
he clarified that the coop bloc is not pressuring RECs to become "true
cooperatives” but merely asking them to comply with the law by being
transparent about the status of their members capital contributions. Crucial to
the question of ownership are the rural electric cooperatives current manner of
booking members’ capital contributions for capital expenditures (Capex) in
their books.
“Instead
of declaring members’ payments for such, most rural electric coops are booking
these amounts as "donated capital accounts’ which is illegal,” Mr. Lico said.
The
By-Laws of cooperatives under PD 269 define members as “joint-owners” of cooperatives
with “equity in the assets” determined according to patronage. Upon
registration with CDA, all members’ equity are computed as “share capital”
covered by a Certificate of Share Capital specifying their respective amounts
of investments and entitling them to dividends, interest and other benefits
from net surplus. The coop bloc estimates equity contributions from some five
million members to RECs now total around P55-billion.
Of
the country’s present crop of 119 rural electric cooperatives, only 14 have so
far registered with the CDA and complied with the law by registering their members’
equity contributions as capital and issuing stock certificates denoting
ownership.
These
include Negros Occidental Electric Coop.; Palawan Electric Coop; San Jose
Electric Coop; Quirino Electric Coop; Pangasinan Electric Coops I and III;
Isabela Electric Coop; Sorsogon Electric Coop; Nueva Vizcaya Electric Coop;
Negros Oriental II Electric Coop; Abra Electric Coop and Agusan del Norte
Electric Cooperative.
Member-consumers
of RECs registered with the CDA are entitled to patronage refund and interest
on share capital when a net surplus is realized. Mr. Lico cited the case of a
member-consumer in Palawan where a single member-consumer received P60, 000 as
his dividends for the energy consumption of his business from PALECO.
Mr.
Lico said despite investing in the coops, member-consumers of many RECs have
neither been receiving their share of the profits due them as shareholders nor
been informed on the status of their equity contributions as coop
member/consumers.
Unless
the DOE and NEA compel rural electric cooperatives to disclose the true status
of members equity contributions, Mr. Lico said the coop bloc of party-list
congressmen and their allies in the Lower House would ask the Appropriations
Committee to sit on the budgets of DOE and NEA until coops are compelled to comply with this
requirement.
Earlier
this year, the Agusan del Norte Electric Cooperative (ANECO) opted to become the
first Mindanao-based REC to register with the CDA, breaching the 20% membership
threshold needed to qualify in a referendum last June 26 when 31, 000 or 28% of
its 110,000 member-consumers voted affirmatively for CDA registration.
As
such, it has since become eligible for tax exemptions and its member-consumers entitled
to dividends and other benefits such as patronage refunds as a CDA-registered
coop while keeping its eligibility for congressional allocations, grants, subsidies
and other assistance as a rural electric service cooperative.
Many
of the 14 RECs registered with the CDA have already managed to turn a profit
since they are now exempt from payment of corporate tax franchise tax, business
tax, real property tax and other taxes resulting in lower distribution rates.
In
a news report, Luis Manuel C. Corral, secretary general of the Association of Philippine Electric
Cooperatives (APEC) party list said the reduction in the cost of power
delivered by CDA registered RECs are lower by 25 to 40 centavos per kilowatt
hour (kWh) due to their tax exemptions from E-VAT and other local taxes .
Under
Section 4 Article 132 of Republic Act 9520 or The New Cooperative Code of the
Philippines, CDA registered RECs are also entitled to congressional
allocations, grants, subsidies and other financial assistance for rural
electrification coursed through the DOE, CDA or LGUs as well as to borrow
directly from local banks on flexible terms.
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