PCSO eyes big savings from suppliers

MANILA, Philippines - The Philippine Charity Sweepstakes Office (PCSO) is batting for lower lease rates from service contractors to boost available charity funds and to comply with Senate and Commission and Audit directives aimed at assuring a fair deal for the government.

PCSO lotto operations manager Remeliza Gabuyo said leading operator in Luzon, the Malaysian-owned Philippine Gaming and Management Corp. (PGMC) has yet to agree to lowering their lease rate from the present 10 percent of retail receipts excluding paper supply.

On the other hand, she pointed out that service provider Pacific Online Systems Corp. (POSC) has agreed to the lower lease rate in June, resulting in P9 million in savings for PCSO from June to December 2015.

Gabuyo said that had the PGMC also agreed to the same terms, the PCSO would have saved an additional P35 million a month from June to December 2012.  The PCSO could have then used the same savings for the urgent medical and health needs of indigent patients. It was a win-win situation that would have been beneficial to all stakeholders.

POSC has signed with PCSO an agreement to extend its equipment lease which expired on March 31. The extension will be up to July 2015 and the new lease rate will be at 7.7 percent, paper supply included.  The additional reduction in the lease rate will mean more savings and more funds for addressing the medical requirements of the country’s marginalized.

PCSO chairperson Margarita P Juico said that the Senate Blue Ribbon Committee noted in its official, final report that the lease rate of the lotto equipment was disadvantageous to the government while the Commission on Audit observed the rates to be iniquitous. 

The Senate directed the present PCSO board to seek a rate lower than the present 10 percent which was negotiated during the term of Manuel Morato who was then general manager and chairman from 1994 to 1998. 

Juico also said that under their contract, the lessors were supposed to upgrade equipment every two years to keep the terminals and other hardware and software at optimum efficiency.  In fact, the terminals are over 16 years old.

Juico emphasized that PCSO is not a profit-oriented institution but has to remain viable to fulfill its mandate of being the principal government agency to raise funds for health programs, medical assistance and services and charities which are national in character.

PCSO’s revenue raising initiatives were marked by a 15-percent increase in sales last year, grossing P36.4 billion in 2012. Gross receipts are divided into three funds: prize (55 percent), operations (15 percent) and charity (30 percent). Savings will result in higher allocations for all three funds. Prize money will increase, operations will be more cost-effective and charity activities will expand to reach more people in need, Juico stressed. 

“PCSO is not an institution for profit.  Rather, it was created to extend charity assistance and help partner-institutions become more efficient in living out our shared vision whether this is to help ease the medical burden of the underprivileged or to provide educational grants or to establish low-cost housing in calamity-stricken areas or to promote sports, wellness and healthy lifestyles,” Juico said.

“While we understand and respect that our service providers are business entrepreneurs who naturally need to have certain returns on invested capital, we urge that they be fair, reasonable and have a heightened sensitivity towards PCSO’s own needs to satisfy all our stakeholders both in the government and private sector. At the end of the day, we have a critical mission to fulfill for our people and we do not intend to abdicate that role by, so to speak, dropping the ball at anytime, anywhere,” Juico added.