When Malacañang’s announced that PAL employees may retire only in accordance with prevailing labor standards–despite Lucio Tan’s political and judicial connections–everybody thought that it is only another manifestation of President Noynoy Aquino’s “matuwid na daan.” Of course, Tan immediately torpedoed the idea by filing a motion of reconsideration. To underline its confident position, it announced the mandatory retirement of some PAL employees who reached 55 years old (according to Tan, the contract stipulates this, despite the 65-year legal requirement).
Malacañang did not react to this Tan ploy and Tan’s defiance of its decision. Now it can be explained. First, DOLE secretary Secretary Rosalinda Dimapilis-Baldoz issued the decision basically upholding all the PAL management position of outsourcing vital core functions such as aircraft maintenance, and the consequent forced retrenchment of more than 3,500 PAL employees. That this is not a question of preserving the profitability of the company is shown by the latest declared profit for 2010 of US$1.6 billion.
When there was fierce opposition, Malacañang stepped in, ostensibly to review the Baldoz decision–and as it now turned out, to preserve Tan’s hide. Malacañang–through Executive Secretary Ochoa–all but upheld the Baldoz decision. The bone thrown to the PAL employees and workers was the higher price for the loss of their jobs and job security.
PAL has always been seen before–even when it was still managed by the government–as a milking cow. Equipment and supplies, staff training, food preparation and the like were all given to management-friendly companies. In Tan’s case, it was his own companies who profited. However, this time, “non-core functions” (his term) will be outsourced, ostensibly to maintain PAL’s profitability. Of course, his profitability has always been assured because–whether PAL loses or not–for his satellite companies, including the outsource companies, selling to PAL always will take in the profits.
The fiction of mismanaged government corporations always producing losses–and thereby justifies privatization–can be traced to these companies always being run as milking cows by both the private or government entities running them. The former because of greediness for more and more profits and the latter because of huge corruptions.
The problem of President Noynoy Aquino is starkly represented by his PAL decision. “Matuwid na daan” seemingly does not cover profit greed and the milking cow syndrome. If he is not careful, his “public-private partnership” policy can be easily turned on its good intentions–by engendering huge private profits for Malacañang-friendly businessmen and huge commissions for Malacañang habitues.
Lucio Tan certainly has his people in Malacañang; they have been maneuvering from day 1 on the PAL case. Unfortunately, the people and the hapless PAL employees and workers seem to have none of their friends in Malacañang. Is the price still right there?