Bad timing causes PSALM to incur P85-M budget deficit for 2012

Ill-timing between its receivables and its maturing obligations will give the Power Sector Assets and Liabilities Management Corp. (PSALM) a budget deficit of some P85 billion next year, a shortfall the state-owned firm is now trying to bridge.   "PSALM is projected to incur a deficit of P85 billion in 2012 based on the approved budget," PSALM president and CEO Emmanuel Ledesma Jr. said Wednesday, noting that that is why the company plans to raise the money by early next year for its 2012 funding requirements.   "We are looking at the following options to raise funds and finance operations: one, on-lending with National Government or two, issue regular peso notes," he said.   The receivables mainly involve the prepayment terms for the National Grid Corporation of the Philippines (NGCP).   NGCP in 2008 won the bid through its $3.95-billion offer to operate and manage the National Transmission Corp. (TransCo) which operates the country’s power transmission highway.   NGCP started operating TransCo in January 2009.   "On the NGCP receivables, discussions with NGCP are still ongoing," according to the PSALM CEO.   The prepayment of TransCo’s privatization proceeds will help improve PSALM’s cash flow requirements in the sense that it may no longer need to borrow money to settle its maturing loans, Ledesma said. — VS, GMA News