‘Disadvantageous’ PCSO lotto equipment lease probed

Senate President Juan Ponce Enrile on Monday scrutinized the Philippine Charity Sweepstakes Office's (PCSO) supposed disadvantageous equipment lease agreement with a Malaysian-owned company. During Monday's Senate blue ribbon committee's hearing on the alleged anomalies in the PCSO, former PCSO chairman Manoling Morato said they had initially awarded the contract for the rental of 350 lottery terminals from Philippine Gaming Management Corporation (PGMC). It was eventually amended to lease 1,250 terminals, he said. Enrile, however, asked the former PCSO officials why they did not conduct another public bidding and continued to avail of PGMC's services even after the eight-year lease expired. "Were not imputing any malice [but] why did you not expose this to a public bidding? Why not change the whole system?" he said. He likewise asked why the PCSO did not opt to buy the machines and the software for $25 million, which was its original worth, when the rental fee until now has cost the PCSO $148. "Why didn’t the PCSO buy...when they knew the potential of the business and they could have made a wise judgment to acquire [this]," Enrile said during the hearing. He also asked why the rental fee, which was originally 4.3 percent of the gross ticket sales of the PCSO, was increased to 6.825 percent to 10 percent. Former PCSO general manager Rosario Uriarte, for her part, said they opted to extend the lease because it would take one year to set up a whole new system. "Titigil po ang buong lotto operation because of the migration na mangyayari (The whole lotto operations would stop because of the migration of data that would need to be conducted)," she said during the hearing. Morato, who was present during the hearing, said that the PGMC had also requested the PCSO to give them time to upgrade the system. He added that they did not buy the system because the equipment would soon be obsolete. "The rapid technological changes in lotto operations will simply be too much for PCSO to handle." The PGMC, which started commercial operations in 1995, is involved in the leasing online lottery equipment and software support. Its principal company is Berjaya Sports Toto Berhad of Malaysia. The PCSO said it has paid PGMC already 9.2 billion from 2005 to July 2011. - KBK, GMA News