DOF eyes amending Privatization Council guidelines

By Anna Leah Gonzales

February 14, 2024, 3:00 pm

<p><em>(File photo)</em></p>

(File photo)

MANILA – The Privatization Management Office (PMO), an attached agency of the Department of Finance, is eyeing to amend the guidelines of the Privatization Council (PrC) for the faster disposal of idle government assets.

Finance Undersecretary for Privatization and Corporate Affairs group Catherine Fong said the move is part of the government's efforts to raise more revenues.

"Actually, what we’re trying to do right now is amend the guidelines, the PrC guidelines, to make this position easier. We need to raise a lot of funds," she said during the sidelines of the Opportunities in Sustainable Water Utilization and Infrastructure Development forum on Tuesday.

The PrC is mandated to oversee the government's privatization program. It approves all proposed privatization plans prepared by PMO and provides final approval for the proposed price and buyer for the assets.

Fong said that while the PrC has approved a lot of properties for disposition, the "PMO is not very good at marketing."

"We are looking at BSP’s (Bangko Sentral ng Pilipinas) model, we are able to give some broker’s fees. I mean, why not use the real estate companies or anybody who are able to sell, give them some fee," she said.

"We are looking at that possibility, we’re looking to revise the Privatization Council guidelines on the disposition. At the moment, the guidelines do not allow us to sell lower than the base price, which is set by two independent appraisals," she added.

Fong said while several properties are already in the pipeline for disposal, they are being bogged down by the long period of appraisal.

"Yung procurement of an appraisal, appraiser palang, sobrang tagal (The procurement of an appraisal, getting an appraiser takes so long). Then you have to wait for the appraisal to happen then we get the average to set the base price for auction, and sometimes the appraisal price, well, for certain properties, minsan mas mababa siya (is sometimes lower) than actual market place," she said.

"Minsan naman, parang sobrang taas niya for actual, so parang wala kaming flexibility (Sometimes it's so much higher than the actual so we have no flexibility). And a lot of the assets that have been auctioned, failed bidding, so how to minimize that. Yun ang tinitry namin isolve (That's what we're trying to solve) right now," she added.

Fong said a lot of the idle government assets already have informal settlers.

For these properties, she said, the option is to just sell them to local government units (LGUs).

However, Fong said LGUs are only willing to buy these properties at zonal value, which is currently not allowed in the guidelines.

"So, our first priority right now is to amend the guidelines to make it easier to dispose of these properties so we can raise more money," she added.

Fong said they are hoping to come up with the amended guidelines before the end of the month.

Latest data from the DOF showed that as of Dec. 12, 2023, the PMO has already remitted PHP1.21 billion to the Bureau of the Treasury.

The amount exceeds the PMO's PHP500-million target, and will be used to finance the national government's spending programs. (PNA)