Senate bill sets limits on pay of GOCC executives

Senator Franklin Drilon has filed a bill that will limit the pay and bonuses of executives in government-owned and -controlled corporations (GOCCs) and create a governing body to regulate state firms. Senate Bill 2566 — written after a series of hearings on the excessive financial packages of GOCC officials — seeks to limit the bonuses of directors and trustees to two months worth of the chief executive officer’s salary. It likewise seeks to limit the money they receive as per diems and prohibits them from receiving any other compensation or benefits. Any other bonuses shall also be subject to the approval of the President, according to the bill. Once the Commission on Audit has determined any financial compensation beyond the limitations of the law, GOCC executives shall be required to refund the state firms they represent any excessive compensation and bonuses given by private corporations. “The monies that they are receiving should be made as part of the earnings of the state firm. They should not take it upon themselves to be entitled to gargantuan amounts, even if they had used their own money in exercising their stock option," said Drilon, chairman of the Senate finance committee. Policy-enforcing body Under the bill, a Governance Council for GOCCs (GCG) will be created to monitor and enforce the policies of state firms. “They will review whether the mandate of a particular GOCC is still valid, whether it duplicates the work of other agencies, whether it should be merged, et cetera," Drilon said in an interview with reporters on Thursday. According to the bill, the GCG will make sure that board members in each GOCC will not exceed nine. It will also have the power to recommend the appointment of state firm executives. As an attached agency of the Office of the President (OP’s), the GCG will be created using P10 million of the OP’s contingent fund. The GCG will have three ex-officio members including the secretaries of the departments of Finance and Budget and Management, and the chairman of the National Economic Development Authority. Two other members will represent the private sector. Drilon, however, noted that the GCG will only have three years to do its job. A Senate hearing earlier revealed some state firms have been giving executive excessive paychecks and bonuses despite owing the national government at least P3.2 billion in unpaid remittances. On Sept. 8, President Benigno Aquino III signed Executive Order No. 7 suspending the allowances and bonuses of the GOCC executives until new guidelines on their compensation can be issued. — JE/VS, GMANews.TV