Solon seeks probe into PCSO contracts involving lottery system

A congressional probe into the country’s P8.3 billion lottery system, including contracts entered into by the Philippine Charity Sweepstakes Office (PCSO), has been sought by a member of the House of Representatives.

Ang Probinsyano party-list Representative Ronnie Ong issued the call in House Resolution 359.

The PCSO’s deals with the Philippine Gaming Management Corporation under Malaysia’s Berjaya Corporation (PGMC/Berjaya) and the Pacific Online Systems Corporation for its National Online Lottery System must be investigated, according to Ong’s Resolution 359.

These companies have managed to secure and keep their equipment lease agreementswith the PCSO for the past 24 years despite various irregularities, the lawmaker claimed.

The PCSO is a government-owned and controlled corporation mandated to raise and provide funds for health programs, medical assistance and services, and charities of national character by conducting charity sweepstakes races, lotteries, and other similar activities as determined and subject to the rules promulgated by the board of directors.

The PCSO’s lease agreements with the PGMC/Berjaya—signed in 1995 as an eight-year contract covering the lotto terminals for online lottery in Luzon—were found disadvantageous to the government during a Senate Blue Ribbon committee hearing in 2011, Ong noted on Tuesday.

The previous Senate probe revealed that the PCSO was renting equipment from PGMC/Berjaya for $148 million when it can buy the same machines for $25 million, according to the resolution.

“This move seeks to protect the people’s money [dahil] ang ultimately po na kawawa dito ay ang ating mga urban poor at mga indigent na probinsyano na umaasa sa mga health programs at pondo ng PCSO,” Ong said in a statement.

Despite a Senate recommendation for the PCSO to renegotiate the rental fees with both PGMC/Berjaya and Pacific Online, the PGMC/Berjaya sued PCSO and dragged the state-owned company before the International Court of Arbitration.

In the end, PGMC/Berjaya’s lease deal with the PCSO has been extended from August 22, 2015 to August 21, 2018.

PGMC/Berjaya also managed to secure another court injunction in 2017 to stop the PCSO from bidding its P10.9 Billion National Online Lottery System, which could have already improve the lottery games, Ong said.

“Saan ka naman nakakita ng ganyan na binabayaran na nga natin sila kahit overpriced, hinahabla pa rin tayo? ‘Yan ang tunay na kahulugan ng iginigisa tayo sa sarili nating mantika,” Ong noted.

“We are paying them so much money so they can sue us. We have to fight this kind of abuse,” the lawmaker emphasized.

On August 15, 2018, the Supreme Court ruled that the PCSO may call for a bid of its online lottery system—later renamed as the Philippine Lottery System (PLS)—with a lesser budget of P8.3 billion.

Still, PGMC/Berjaya secured another extension of its lease deal with the PCSO until August 22, 2019 because the PCSO supposedly failed to “timely procure” the PLS.

Pacific Online’s lease agreement cover the Visayas and Mindanao was also extended for the same reason.

“There is a need to stop the irregularities, violations, disadvantageous terms and/or corruption as regards PCSO contracts, gaming activities and bidding in line with the President’s directive to address corrupt practices at the PCSO and among the operators of various games,” Ong said. —Llanesca Panti/VDS, GMA News