Editor’s Notes: "One Messy OWWA" is one of the 38 articles Kuwait-based Freda Editha O. Contreras wrote before in her now-defunct OFW site on Suite101.com. She is publishing them into a book, which is entitled, "Overseas Filipino Workers." It is due for release in August 2007. This publication is presenting Ms. Freda’s article in two forms: A Summary and a Full-length Version. Ms. Freda’s literary work proves that activism can coexist with full-time work in a foreign land.

OWWA stands for Overseas Workers Welfare Administration. In May 2002, DOLE Sec. Patricia Santo Tomas exposed the mess in OWWA to the public. She said that OWWA lost some P1.2-Billion in fund as a result of bad investments entered into by then Administrator Wilhelm Soriano. Secretary Santo Tomas also revealed that OWWA’s administrative expenses in the past year far exceeded that of welfare assistance being given to OFWs. Meanwhile, disgruntled OFWs could no longer contain their anger as to OWWA’s mishandling of their hard-earned contributions. The OWWA contribution entitles each OFW to welfare benefits, loan packages and scholarship programs for their children.

A CALL TO ACTION FOR OWWA TRANSPARENCY and RESTRUCTURING

WE, the Overseas-Filipino Workers (OFW) and our supporters, demand that the Overseas Workers and Welfare Administration (OWWA) submit itself to a full public management and accounting audit without delay, not only for collections and expenditures for year 2001 but also for previous years.

We strongly believe that the restructuring of OWWA fund management and utilization towards improvement of services and greater OFW and civil society representation should be considered as urgent legislative agenda. Then OWWA Administrator Wilhelm Soriano said that he has the "binding authority as to where to invest the OWWA Fund, including how and how much."

The superficial evaluation conducted by OWWA's Acquired Assets and Investments Unit for the SMRDP investment was not an isolated case . . . the P500 million invested in SMRDP constituted a whopping 45 percent of the OWWA's capital funds at the time, something that would have raised eyebrows among professional fund managers."

A study of OWWA's expenses also shows its lopsided priorities. "From 1998 to 2001, OWWA's expenses averaged 86-percent of its total income for the previous year.

1. Immediately implement the US$25 as voluntary OWWA membership fee. The original vision that the OWWA contribution must come from employers, as supposedly mandated by law, is already lost, especially for the Balik Manggagawa or returning Overseas-Filipino Workers (OFWs) with renewed contracts.

2. Resume the investigations on the alleged OWWA fund mess, specifically on the investments made in Landoil and SMRDP, and perform a full public-management and accounting audit.

3. Expose those who may wish to obstruct any investigation and charge them appropriately in courts.

4. Release the official audited reports on OWWA fund collections and expenditures for 2001 and previous years and publish them in an official website.

5. Restructure the OWWA and study how the welfare fund could be transformed for better services to members.

6. Review the OWWA administrative guidelines and provide a reasonable and specific cap on expenditures. Increase funding for direct benefits to members, which may come in the form of a provident fund.

In particular, establish clear, democratic-and-transparent criteria for the selection of the OWWA board and administrator, with more OFW representation in the board.

* * *

Here is the article in its entirety:

One Messy OWWA

By Freda Editha O. Contreras

OWWA stands for Overseas Workers Welfare Administration. It is one special government body under the Department of Labor and Employment (DOLE) which collects, among its various functions, US$25 from each Overseas-Filipino worker OFW) leaving the country either to work for the first time abroad or as a returnee. Originally, as a rule, this US$25 was being paid for the OFW by his/her prospective employer at initial employment. Some employers paid and others didn’t. After a while it was offered as a voluntary contribution to OFWs interested in getting back something should accident or the inevitable happen to them. Then a few years back, the US$25 became mandatory and no OFW is allowed to leave the country without paying it!

Understandably, OWWA’s life depends on this US$25 contribution – be it paid for the first time by individual employer or otherwise. It uses the fund for its many welfare functions, so to speak, as well as its administrative duties. But what happens when the fund is used indiscriminately and outside its original purpose? A mess, it will be, of course, and that’s where OWWA is in right now!

In May 2002, DOLE Sec. Patricia Sto. Tomas was first reported to have exposed the mess in OWWA to the public. She said that OWWA lost some P1.2-B in fund as a result of bad investments entered into by then Administrator Wilhelm Soriano. Secretary Santo Tomas also revealed that OWWA’s administrative expenses in the past year far exceeded that of welfare assistance being given to OFWs. While welfare assistance pegged 22% only, administrative costs reached a high 77%, she said.

As investigation into the mess escalated, Soriano went on leave and was later replaced, in early November by Virgilio Angelo, previously of the Philippine Charity Sweepstakes Office (PCSO). Soriano, according to Labor Secretary Santo Tomas, could be held liable in court for investing the OFWs’ money without approval of the OWWA Board of Trustees of which she sits as chairperson.

Investigation is still going on . . .

Meanwhile, disgruntled OFWs could no longer contain their anger as to OWWA’s mishandling of their hard-earned contributions. The OWWA contribution entitles each OFW to welfare benefits, loan packages and scholarship programs for their children. The OFWs are now in the process of signing a Petition entitled "A Call to Action for OWWA Transparency and Restructuring" started on the Internet via the OFW Community of Lists. Spearheaded by Alfredo Ganapin (now deceased) of eLagda-Riyadh, he likewise collected and collated signatures, which as of his last report dated December 23, 2002, reached more-than a thousand signatories.

In order to get a better understanding of what the OFWs are clamoring for, I find it fit to include here below the full text of their ‘Call for Action’:

A CALL TO ACTION FOR OWWA TRANSPARENCY and RESTRUCTURING

WE, the Overseas Filipino Workers (OFW) and our supporters, demand that the Overseas Workers and Welfare Administration (OWWA) submit itself to a full public management and accounting audit without delay, not only for collections and expenditures for year 2001 but also for previous years.

While millions of pesos continue to be collected from vacationing OFWs and first-timers, six (6) months have already passed and reports on the alleged misuse of funds have remained unresolved and services in areas of deployment are affected. A preliminary report on this has already been submitted by the Secretary of the Department of Labor and Employment (DOLE) on May 23, 2002, to

the Presidential Anti-Graft Commission but we have yet to hear of any results. Senate and House Resolutions have also been introduced to look into the OWWA fund utilization but these have yet to be followed up.

We strongly believe that the restructuring of OWWA fund management and utilization towards improvement of services and greater OFW and civil society representation should be considered as urgent legislative agenda. The issue of whether the $25 OWWA membership fee is mandatory or voluntary and whether it is a trust fund or not should also be addressed.

We also urge our legislators to transcend political affiliations and loyalties and pursue with diligence and commitment the Senate and House Resolutions on the OWWA fund.*

The controversial investments, going as far back as 1983 with the P200-million advanced to Landoil Resources (majority owned by Speaker Jose de Venecia) and Greater Manila Land Corporation, were done without the approval of the Board of Trustees. More recently, in 1995, some P500-million in investments were made to the Smokey Mountain Reclamation and Development Project (SMRDP) certificates. Accumulated interest and principal of these investments reportedly remain uncollected to this date.

Considering the huge amounts involved in the Landoil and SMRDP investments, we find former Administrators Wilhelm Soriano’s and David Corpin's decisions without the board's approval, while invoking Memorandum of Instruction 008 issued in 1986 to cover such actions, as the height of imprudence.

Then OWWA Administrator Wilhelm Soriano said that he has the "binding authority as to where to invest the OWWA Fund, including how and how much." http://www.inq7.net/nwsbrk/2002/jun/10/n . . . But the same article pointed out that "the lack of due diligence in evaluating investments is glaring. The superficial evaluation conducted by OWWA's Acquired Assets and Investments Unit for the SMRDP investment was not an isolated case . . . the P500-million invested in SMRDP constituted a whopping 45-percent of the OWWA's capital funds at the time, something that would have raised eyebrows among professional fund managers."

The DOLE Committee report argued that the Presidential Decrees 1694 and 1809 are "the clear mandate that financial transactions as far as the workers money is concerned, were subject to the rules and regulations of the Board of Trustees." PD 1809, issued in 1981, provides that all "transactions in the Welfund (workers welfare fund) shall be subject to such rules and regulations as may be formulated by its Board of Trustees."

The report also said that the "MOI 008, issued by Administrator Salvador Bigay, mentions that the Capital Fund shall be administered and controlled through the Office of the Administrator. Even this MOI, however, does not deviate from what the PDs require as the administration and control is only through, and not by, the Office of the Administrator, and the investment shall still be within the guidelines set by the management." http://www.manilatimes.net/national/2002...

"As authorized under PD 1809 which amended PD 1694, the OWWA board, as a matter of policy, requires that Soriano should utilize not more-than 50-percent of the agency's investment income of the previous year provided that a forced savings equivalent to 20-percent is imposed. On programs budget, the law has a restrictive provision where Soriano is not allowed to use more than 60 percent of the funds from the workers' contribution and membership fees. Who allowed him to utilize up to 134-percent of the funds for operations could hardly be accuser Sto. Tomas. What makes Malacañang hesitant to open up the big can of worms is a valid administrative question the Labor chief should pursue."

http://www.tribune.net.ph/20020520/comme...

A study of OWWA's expenses also shows its lopsided priorities. "From 1998 to 2001, OWWA's expenses averaged 86-percent of its total income for the previous year. In 1998 and 2002, expenses actually exceeded the previous year's income. The 2001 figures show P636,588,140 in expenditures. Of this total, only P143,596,722, or 22.5-percent, was spent on benefits for OWWA contributors. The balance went to operating expenses, mostly salaries. Of the proposed P883-million budget for 2002, only P287 million, or 32.5-percent, will go to benefits, while the balance will be used for operations." http://www.inq7.net/nwsbrk/2002/jun/10/n...

Also, during a campaign by the United Filipinos in Hong Kong in 1996, they presented a pie chart, which showed that only 11% of the $25 membership fee actually goes to direct benefits for OFWs such as insurance claims, burial assistance, disability, welfare assistance, etc., while the rest of the amount goes to the overseas allowances of OWWA and DOLE in various countries, service delivery costs, rentals of office space, etc. [From OWWA Pie Chart, United Filipinos (UNIFIL) in Hong Kong; and the Migrant's Focus Magazine: Issue #2 "A Feast in Government Fees"; provided by the Asia Pacific Mission for Migrant Filipinos]

In the light of the aforementioned, we therefore demand the following:

1. Immediately implement the US$25 as voluntary OWWA membership fee. The original vision that the OWWA contribution must come from employers, as supposedly mandated by law, is already lost, especially for the Balik Manggagawa or returning Overseas-Filipino Workers (OFWs) with renewed contracts. Although there are agencies that make sure that this fee is shouldered by employers and will not be deducted from the workers, this is usually only true for new OFWs. Compliance is difficult, if not totally non-existent, from employers of returning OFWs.

2. Resume the investigations on the alleged OWWA fund mess, specifically on the investments made in Landoil and SMRDP, and perform a full public-management and accounting audit. If it has nothing to hide from the past, then OWWA should submit itself to a full-and-unhampered investigation. Appropriate administrative sanctions or charges should be placed on officials who erred.

3. Expose those who may wish to obstruct any investigation and charge them appropriately in courts.

4. Release the official audited reports on OWWA fund collections and expenditures for 2001 and previous years and publish them in an official website.

5. Restructure the OWWA and study how the welfare fund could be transformed for better services to members.

6. Review the OWWA administrative guidelines and provide a reasonable and specific cap on expenditures. Increase funding for direct benefits to members, which may come in the form of a provident fund.

7. Evaluate the history and functions of the different agencies that are involved in the welfare and protection of OFWs and determine if they are really responsive to the needs of the Filipino workers.

8. Craft laws that will provide greater OFW and civil society representation in policy-making bodies related to OFW concerns. In particular, establish clear, democratic-and-transparent criteria for the selection of the OWWA board and administrator, with more OFW representation in the board. We have not forgotten the OFWs and their families who have benefited from OWWA assistance, such as for accidents and burials, but any assistance that OWWA has rendered in the past or any of its achievements should not be used to gloss over any irregularities in rendering of other services or the misuse of the funds.

We appeal to our Kababayan who are employed in OWWA to understand our demands as not a personal attack on their livelihood and future but a necessary step to improve the services to OFW members, especially those who are in distress, and to protect from misuse the resources that we have contributed for OWWA's existence in the first place.

We look forward to the new OWWA Administrator Virgilio Angelo to rise to the challenge of addressing the above-mentioned demands.

We also urge the government to review its mandate as expressed in Article V, Section 8 of the Migrant Workers and Overseas Filipinos Act of 1995 (RA8042), that "All fees for services being charged by any government office on migrant workers as of June 7, 1995, shall not be increased. All other services rendered by the DOLE and other government agencies in connection with the recruitment, introduction and placement of any assistance to migrant workers shall be rendered free."

The paramount role of the state is to ensure protection and the well being of its citizens, wherever they are.

We are calling on all concerned kababayan, egroups, NGOs, government officials and legislators to act together for the welfare of all OFWs around the world.

THE TIME TO ACT TOGETHER IS NOW! # # #

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