Senate body junks entire CAB budget

A Senate finance subcommittee headed by Sen. Joker Arroyo completely slashed yesterday the proposed P76-million budget of the Civil Aeronautics Board (CAB) for 2003.

"We decided to eliminate the CAB budget after its officials failed to justify the naming of CLA, a non-existent airline company, as an official flag carrier of the Philippines," Arroyo explained.

The CAB even got for CLA four-and-a-half slots at Narita airport, even if it did not have any airplane. Had these slots been granted to a legitimate flag carrier like Philippine Airlines, the country would have earned at least $7.5 million in potential tourism revenues.

Earlier this month, Arroyo and Senate Minority Leader Vicente Sotto III warned that the CAB, an attached agency of the Department of Transportation and Communications, would have its budget cut if it could not adequately explain why CLA, a non-operating airline, was named a Philippine flag carrier.

President Arroyo named CLA Transport, a company without any congressional franchise and without any airplane, a national flag carrier based on the recommendation of the CAB.

Sotto said CLA has no franchise yet, but has already been granted "four and-one-half" slots by Japan based on its accreditation as a national carrier.

"The government lost about $7.5 million in potential revenues from tourists because the slots were given to a non-existent airline company," Sotto said.

Transportation Undersecretary Arturo Valdez said that he was embarrassed when he went to Japan last Nov. 28 seeking additional slots for Philippine flag carriers.

Valdez told the Senate committee that Japanese officials virtually scolded him for seeking additional slots because the Philippines had not used for about 18 months the four-and-a-half slots granted to CLA.

He said that because of its non-use, the slots were canceled.

"CLA is non-existent so it could not have used the slots allotted to it by Japan," Sotto said.

He explained that a slot is equivalent to a "parking space" for an airplane. The slots for CLA were on a weekly basis.

The CLA was reportedly organized by businessman Pepito Alvarez with several Japanese investors as fellow incorporators.