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Previous Reports
July 2, 2007
June 06, 2007
June 04, 2007
May 30, 2007
May 28, 2007
May 24, 2007
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Bulletin No. 08-0711
The OIC’s Report
by
Federico A. Espiritu
RATIONALIZING A
RATPLAN
29 years of credit delivery services have been QUEDANCOR’s valuable
contribution to the country’s agriculture sector. Through this time, the
Corporation has been able to benefit and assist the multitude of the
country’s small agri-fishery workers through channeling them with adequate
loan assistance for their respective endeavors.
However, just like the cycle of a normal company, there are times wherein
crisis and problems may appear that threaten to mitigate the efficacy of
operations and the development of the agency and its core personnel.
Unfortunately for the agency, the present situation we at QUEDANCOR have
been facing delves on this kind of scenario and in effect, certain actions
and corresponding consequences have to be made.
Due to the expansion of corporate operations starting in 2001, QUEDANCOR
President and CEO Nelson C. Buenaflor cited the need to increase manpower
staffing in order to address the growing loan-based activities in line with
the agency’s mandate of providing affordable and accessible credit to its
farmer and fisherfolk clientele. This involved intense recruitment to fill
the needed complement for work units that were upgraded to department status
within the Central Office as well as the formation of the Corporation’s
District and Extension Offices all over the archipelago.
Augmenting the existing 451 plantilla positions by an additional 744
personnel in five years as authorized by the Board in 2002 augured well for
the Corporation, at least in terms of allocating credit resources to its
beneficiaries and enhancing its loan activities to the countryside as
indicated by loan releases from 2001 to 2005, in which the agency has
increased its loan releases from P1.4 Billion in 2001 to P5.3 Billion in
2005, although this trend has significantly spiraled down to P3.98 Billion
in 2006. Amidst this, however, the Board authority was abused as the
authorized complement of 1,195 soared to 1,800 and overshot by over 600
personnel.
Although these figures have became the passport of QUEDANCOR in tapping the
financial resources of banking institutions, the boom in manpower and the
rapid expansion of DOs and EOs have taken their toll insofar as providing
for the expenses that QUEDANCOR has been incurring in terms of operational
activities and providing for personnel services are concerned. Also, the
poor collection and remedial action performed by some District Offices,
especially those who have released wholesale and bulk loans, have hampered
the aggregate performance of field operations.
In short, even though QUEDANCOR has been amassing huge figures in terms of
loan releases, its corporate performance has been a picture of inconsistency
as it is not able to collect repayment from program beneficiaries and
thereby adversely affecting its capital base. For some time, QUEDANCOR was
rapidly channeling loan and credit allocation to millions of clientele, but
has paled comparatively in collecting dues and thus finding difficulty to
immediately service its financial obligations to its partner banks. Evident
of this reality is the accumulation of past due accounts by the Corporation,
which stood at a staggering P4.19 Billion as of last year. Add to this
figure is the total amount of liabilities which stood at P12.3 Billion in
2006 supplemented by a negative income of P23.3 Million, and you have a
Corporation that is literally hanging in the noose.
Even as management has been contemplating on the possible actions to address
the prevalent situation, Malacanang has issued a directive ordering all
governmental entities to reduce expenses and observe optimized cost
utilization. President Gloria Macapagal-Arroyo, serving a fresh term, felt
that this was of utmost need as the country is attempting to veer away from
a fiscal crisis scenario. In this regard, Executive Order No. 366, or the
Rationalization Plan was ordered in 2004.
E.O. 366 required that all state offices and agencies rationalize their
respective organizations in order to promote the efficacy of their functions
at the same time reduce expenses for the state. This will involve abolition
of several government agencies and reduction of employees from the civil
service. In adherence to this order, President and CEO Buenaflor has
recommended the creation of the Change Management Committee that will craft
and implement specific measures for the Corporation in drafting its own
Rationalization Plan.
Initially, the Change ManCom recommended the reduction of personnel
complement by 220 employees. However, due to present circumstances being
undertaken by the Corporation and upon further reconstitution and
structuring in accordance to industry standard and practice, the revised
proposal increased the number of employees to be retrenched by 88, thus
making the final proposed reduction of 308 employees after several revisions
that would have entailed firing 345 employees at the highest.
Upon Board Management Committee instruction, we have sought the Department
of Budget and Management’s deferment in acting upon our previously submitted
Rationalization Plan pending the submission of a revised one that would
consider the Corporation’s financial bleeding and the need to revisit cost
reduction measures, organizational fine-tuning and restructuring..
The Change ManCom delved on several areas before making such recommendation.
Among those mapped out are the redundancy of duties among employees, degree
of function regarding departments, performance of respective DOs and EOs,
regarded as the “cash cows” of the Corporation. Another important aspect
considered is the professional demeanor of the corporate personnel. Those
employees who have observed irregular exhaustion of their duties as public
servants have been identified and are to be the first to go. However, the
final parameters are still being unveiled as the DBM would still have to
evaluate the RATPLAN.
When the corporate rehabilitation plan was being discussed with the
Governing Board led by Agriculture Secretary Arthur C. Yap, your OIC was
given a direct order by Secretary Yap to terminate all casual and
probationary employees as the first step in stopping the gush of financial
bleeding. As by instinct, the former replied that doing such would severely
cripple the Corporation, especially that QUEDANCOR is in the midst of
intensified collection efforts.
Instead, your OIC suggested that those who have erring cases be the
preliminary casualties, since they are viewed to be detrimental to the
agency in the long run, as well as those who are classified as Job Order and
Emergency Employees, whose compensation are being charged against the MOOE.
The first wave of this administrative action saw 32 employees terminated at
the end of closing hours of June 30, 2007.
The Revised Rationalization Plan also carried the downsizing and
re-alignment of departments in the Central Office to ensure optimal
utilization of their respective duties and functions. Also observed was the
integration of several District Offices to reduce repetition of area
assignments and the conversion of identified District Offices into Extension
Offices in areas rendering meager income allotment to corporate coffers.
Also, the Change ManCom upheld the abolition of the 14 Regional Assistant
Vice-President (RAVP) positions upon considering the persistent advice by
the Department of Budget and Management, the main arbiter of the National
Rationalization Plan. In their stead would be the 5 Area Cluster Supervisors
who shall oversee the operations of the DOs in their respective areas of
jurisdiction. These modes of action will be beneficial for the Corporation,
since the reduction of maintenance costs and service expenses would
translate to P13.3 Million on annual corporate savings. To assure everyone,
we will again start from zero-based reorganization as we rationalize the
actual complementation of our RATPLAN from that will be approved by the DBM.
The RATPLAN that takes time at a longer process debunks the wrong notion
that there will be an immediate termination of employees and abolition of
Regional Offices as believed by many. This process takes time and as OPLAN
RISE and OCW gains success and reverses the financial bleedings, for all we
know, we have the right reasons to reverse our position on the RATPLAN since
we have proven that we survived the worst crisis.
In this regard, as your OIC, I know that these recent events and modes of
action undertaken by the management has become the source of many criticism
and negative outlooks, especially coming from the rank-and-file, which is
the most hard-hit by this slew of administrative actions. Let us however not
lose focus that the primordial mission is to save QUEDANCOR.
What the entire Executive Committee and management is currently doing are
geared not for the benefit of personal interest, but for the whole good of
the Corporation. A greater number of our workforce, has considered the
Corporation to be an integral part of our lives, our family aside from the
loved ones that we have at home. But the current situation calls for
immediate and drastic action, unless the agency itself will cease its
existence.
Let it be known that your OIC and the rest of the QUEDANCOR management would
keep tabs in ensuring that the welfare of the corporate staff be given a
significant consideration as regards the rationalization plan being evolved
by the agency. In turn, we also seek the understanding of the personnel
about the grim state of QUEDANCOR and to keep an open-mind regarding the
implementation of these actions. We would also welcome additional feedbacks,
suggestion, opinions and other inputs coming from employees in assisting
management as we jointly steer the Corporation back to normalcy and
hopefully, become a big player once again in the infusion of credit services
to the countryside. For this reason, your OIC promptly brought to the
attention of the Board the manifesto of the field offices on the RATPLAN for
their deliberation. In the meantime, all of us have a Corporation to save.
Feel free to send your
feedback, comments, views and suggestions to the OIC’s e-mail address:
feddie_espiritu@yahoo.com
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