Wednesday, 1 August 2012

JP-LGU can look forward to bigger share from mining wealth

In future, the coffers of the local government unit (LGU) could get a boost through the municipality’s share from mining wealth under the recently signed EO79. – MWBuzzpic by AP HERNANDEZ

AS HOST to mining activities, the municipality of Jose Panganiban can look forward to a bigger share from the mining wealth and its “timely release”.

This was laid down by the recently-signed Executive Order No 79 seeking to streamline the mining industry and to increase the national government’s share from the mining revenues.

The order was signed by President Noynoy Aquino last July 6.

Section 12 of the EO has directed the Department of Environment and Natural Resources (DENR), the Department of Budget and Management (DBM) and the Department of Finance to “ensure the timely release of the share of local government units (LGUs) in the National Wealth.

The section has further directed said agencies to “study the possibility of increasing LGUs share as well as granting them direct access similar to existing arrangements in the Philippine Export Zone Authority (PEZA)”.

The move has been widely supported by the Joint Foreign Chambers (JFC) of the Philippines in a statement released shortly after EO79 was made public.

“The JFC welcomes commitment (of the national government) to provide a timely release and even an increase in the share of national wealth from mining to the LGUs in which mining operations take place for the benefit of the people in these areas,” said the chamber in a statement.

JFC is composed of foreign companies operating in the Philippines, including mining companies.

MWBuzz has not ascertained as to how the municipal government is getting as its share from the so-called mining wealth.

The community is host to gold miner Johson Gold Mining Corporation (JGMC), which operates at Baranggay Bagong-Bayan on the outskirts of the town.

But in recent interviews with Mayor Ricarte Padilla, he told MWBuzz that the municipal government has appealed to the national government to give it the power to collect the excise tax of 2% for mining as host to the mining activities.

He said that the share of the national government will be duly remitted only after the share of the municipality has been deducted.

“This will insure that the host municipality will have immediate available funds which shall be used to address the degradation of the infrastructure and the environment caused by mining operations,” Padilla said.

Environment Secretary Ramon Paje told a media briefing detailing EO79 that Congress is in the process of finalizing the proposed revenue-sharing scheme between the government and mining companies, specifically the 5% royalty government wants the mining firms to pay.

Paje said that at present, the national government is only getting 2% in excise tax, which he said is “hurting the government”.

He said through EO79, the national government stand to earn a windfall of P50 billion from the sale of mining wastes; P760 million from occupational fees upon filing; and up to P16 billion from royalty payments from the existing 33 mining operations in the country by 2016.

Paje said that of the 33, 11 are mineral reservations and have been paying royalties to the government.

According to a study done by mining watchdog Bantay-Kita, the government earned only P13.7 million in mining revenues last 2010, against the actual value of minerals extracted during the same period which, was P144.4 billion”.

Representing only about 9% of the total value, the government’s share was “a pittance”, Bantay-Kita said.

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