Failure to pay P5.8-B SGS bill will damage RP image, says DOF usec

A top official of the Department of Finance warned yesterday that any failure of the government to pay the "validated" billings of the Societe Generale de Surveillance (SGS) worth about P5.8 billion would have repercussions on the confidence of foreign investors and the business community.

Finance Undersecretary Cornelio Gison told the Senate committee on finance headed by Sen. John Osmeña that even during the Estrada administration, then Foreign Affairs Secretary Domingo Siazon said that the settlement of the SGS claims is an issue that could erode the confidence of the business community.

"There was also the visit by the Swiss ambassador calling for the early settlement of the SGS claims," he said, as he contended that it was not only the incumbent administration that was pressing for the settlement of the claims of SGS, whose pre-shipment services contract with the government expired in March 2001.

Osmeña, however, threw aside Gison’s warnings on non-payment of the SGS claims.

The committee is investigating claims of Deputy Customs Collector Emma Rosqueta that of the original P6.2-billion billings of SGS, only P3.16 billion should be paid as the rest constituted either double or erroneous billings.

Rosqueta headed a joint Bureau of Customs-SGS committee that reviewed the billings. She was later replaced by Deputy Customs Collector Gil Varela under orders of Customs Commissioner Titus Villanueva. Under the review panel reconstituted on Oct. 4, SGS’s billings totaling 192.4 million in swiss francs or about P5.8 billion was "validated." Finance Secretary Jose Isidro Camacho later approved the payment of the amount.

This drew intense questioning by Osmena, who said that Camacho, who is responsible for increasing government revenues, had approved instead the increase of government liabilities from P3.1 billion to P5.8 billion. Osmeña also said that the finance department should give more importance to the interests of the Filipino people than of a foreign corporation.

Gison retorted that Camacho had repeatedly stated that SGS should be paid based on fairness, and that this policy was followed.

Lawyer Aaron Redubla, Villanueva’s chief of staff and member of the review committee, said that they went over two million records to validate the claims of SGS questioned as "double billings" before coming out with their recommendation.

"There was confusion only because Deputy Collector Rosqueta submitted figures independent of the review committee. The figures she cited did not come from the review committee but from herself alone. We are standing by our report," Redubla said.