Former Senate President and justice secretary Franklin M. Drilon said the President has the power under the GOCC Governance Act to direct the merger of the state-owned Land Bank of the Philippines and the Development Bank of the Philippines.
“Congress has already delegated to the President, by virtue of GOCC Governance Act or Republic Act 10149, the power to reform, reorganize and merge GOCCs including state-owned banks,” said Drilon who authored and sponsored RA 10149.
“A bill authorizing the merger is a waste of time and taxpayers’ money as Congress has already delegated such authority to the President when it enacted RA 10149,” he stressed.
A bill has been filed in the House of Representatives to direct the merger of the country’s two state-owned banks.
Drilon explained that Section 5 (a) of the GOCC law provides that the Governance Council for GOCCs (GCG) has the power to “evaluate the performance and determine the relevance of the GOCC, to ascertain whether such GOCC should be reorganized, merged, streamlined, abolished or privatized.”
Upon determination by the GCG that it is to the best interest of the State that a GOCC should be reorganized, merged, streamlined, abolished or privatized, it shall implement the reorganization, merger or streamlining of the GOCC, unless otherwise directed by the President, according to the law’s author.
The council may also recommend to the President the abolition or privatization of the GOCC, and upon the approval of the President, implement such abolition or privatization, he added, emphasizing the extent of delegated authority that RA 10149 has given to the President, through the GCG.
Ordinarily, Drilon said the merger of GOCCs would require the enactment of a law. Through Republic Act 10149, however, the legislature delegated to the President the power to merge GOCCs created by law, such as the LBP and DBP.
“The power is with the President; no longer with Congress,” Drilon added.
“The basis of the merger is the fact that the DBP and Landbank are duplicating each other’s functions. The President can implement the merger even if there is no amendment to the charter of the two banks,” he stressed.
Drilon also cited Section 31 of Executive Order 292 which provides for the continuing authority of the President to reorganize his Office. The EO states that “the President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have continuing authority to reorganize the administrative structure of the Office of the President.”
