March 28, 2000

$10 million of funds for Philippines' poor
Allegedly Diverted By President Estrada and his family/friends
Just another part of the massive corruption of PI 

Edwin Tuyay for Asiaweek
Tan serves the poor and takes on the powerful

Tan's letter, also disseminated via the Internet, contended that some 430 million pesos ($10.5 million) of the lottery's funds for the poor went to projects of President Joseph Ejercito Estrada, First Lady Maria Luisa "Loi" Ejercito and their eldest son Jinggoy Estrada, mayor of suburban San Juan, as well as other officials. That left just $1.6 million for the charity's regular beneficiaries. The claim has prompted a review of PCSO procedures and put the First Family on the defensive.

The letter also spurred the opposition member of the cabinet, Vice President and Social Welfare Secretary Gloria Macapagal Arroyo, to criticize Estrada publicly for the first time. She has likened the PCSO scandal to the BW case, in which Estrada is accused of interfering with a stock market inquiry. "It will result in the waning trust of people in the government," she told reporters. The antigraft Senate Blue Ribbon Committee is conducting a probe, for which the First Lady, her son Jinggoy and Tan testified on March 22.

The brouhaha began on Feb. 28, when the president replaced four of the PCSO's five directors, including Tan and respected former Supreme Court justice Cecilia Muñoz Palma, who was the chair. The new board includes lawyer and former Securities and Exchange Commission chief Rosario Lopez, who was elected chair; Cirio Santiago, Estrada's moviedom friend; accountant Manuel Reyes, the president's neighbor in his suburban home; youth leader Cesar Chavez, a protégé of another presidential son, and physician Gregorio Moral, Lopez's brother-in-law. Tan complained that she found out about the board revamp only when she asked the board secretary about the next directors' meeting.

In July 1998, newly elected President Estrada installed Palma's group in the PCSO "to clean up the agency," previously under Manuel Morato, an arch-critic of Estrada who ran against him in the May 1998 presidential elections. Sister Christine recalls: "I accepted the job because I wanted to help channel funds to the truly poor . . . I had tried my best, doing more than expected, cheating no one, padding no prices of medicine, recommending no ghost employees, stealing not a single peso from this multi-billion-peso agency."

But after a few months in office, Tan's letter alleges, "requests from congressmen and mayors, from the president and the First Lady were becoming more frequent, while funds for our regular hospitals and institutions were becoming extremely difficult to secure." She adds: "We were ordered to send all ambulances to Jinggoy Estrada . . . I learned to object to such requests, to question, to stall, to defer resolutions." In conclusion, the nun wrote: "Why was I removed? Elections are coming, and I have not learned to steal."

Estrada fumed. "There are no thieves in my family," he declared. First Lady Loi Ejercito called her first press conference ever to detail just how much the PCSO disbursed to her office. "Not a single centavo of funds I requested and received has resulted in any personal gain for me or my family," she later told the Senate. As for presidential son Jinggoy's more than 100 ambulances, he distributed them as the elected head of the mayors' league.

If anyone should be accused of graft, says new PCSO chief Lopez, "it should be Justice Palma and her son Tady." Lopez alleges that Palma's administration spent $4.87 million on "expired and ineffective" medicines for the failed Drugstore of the Masses project. Lopez also alleges anomalies in the procurement of billboards and an elevator. She says Palma and her directors were removed "because the PCSO has incurred losses."

"There was no corruption during my administration," counters Palma. "We purchased only 14 million pesos [worth of medicine] and they went to 15 hospitals to benefit 15,000 indigent patients." She blamed the losses on huge debts incurred under her predecessor Morato.

Palma concedes that projects funded by the 430 million pesos "were all in accordance with the PCSO charter. So Malacañang did not misuse the funds." Tan herself told the Senate: "I never used the word wrongdoing . . . my complaint is the disproportionate allocation of funds for projects of the First Family."

Jesuit priest James Reuters believes "the charges she [Tan] made will have no factual support." Maybe so, but Vice President Arroyo notes: "Charges have been raised by a very credible person, and that cannot be ignored." Estrada himself said on radio:"I never thought a nun could also be a liar." Yet with all the scandals around, many Filipinos are having a hard time taking his word as gospel truth.

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