Babe's Eye View article

Four years ago, Panfilo Villaruel got past the guards at the Air Transportation Office (ATO) and stormed the NAIA control tower to denounce corruption in government. Villaruel was eventually killed in a police operation that was dubbed by many as an "overkill."

Villaruel, whom I knew personally, was a member of Philippines, Inc. He was the ATO chief during the time of FVR and he was extremely bothered by the corruption at the ATO, warning that a major disaster would happen if something was not done about it.

So far, we have been lucky that no major crash has happened, but this ratings downgrade by the Federal Aviation Administration (FAA) is a kind of disaster with enormous consequences to the country.

The tourism sector is alarmed that the downgrade would seriously hamper efforts to attract more American tourists into the country, plus the fact that many investment opportunities may be lost because the Category 2 rating gives a negative impression of the Philippines once again.

One of the biggest casualties of the downgrade is Philippine Airlines, the only local carrier that flies to the US. PAL has been forced to lower its projections and plans to expand its US flights have been affected. Even the delivery of new Airbus 320 and Boeing 777 jets hangs in the balance because the downgrade prevents PAL from changing the type of aircraft currently used for its US routes.

In fact, PAL has one of the best safety records, its maintenance done by Lufthansa Technik Philippines, an affiliate of Lufthansa Technik of Germany which is one of the world's biggest aircraft maintenance providers. "El Kapitan" Lucio Tan's son-in-law Joseph Chua told me that PAL has gone out of its way to ensure the safety of all its aircraft, not content with just complying with minimum international safety standards.

In contrast, Adam Air and Garuda of Indonesia had fatal accidents last year, with a Boeing 737 plunging into the sea near Sulawesi with no survivors while another aircraft got so badly damaged after a heavy landing that insurers already wrote it off. Indonesia's safety performance has been dismal over the last 25 years, and it's one among the 20 countries with an FAA Category 2 rating, but Indonesian authorities have done nothing about the problem.

The fact is, US Ambassador Kristie Kenney herself flies PAL and believes the airline has one of the best safety records. I had breakfast with the Ambassador last Thursday and one of the things she told me is that the FAA rating had absolutely nothing to do with politics, contrary to suggestions that the US was behind the downgrade to force PAL's hand regarding the open skies issue and allow more American airlines to come in. She said the FAA had already conducted an audit and warned ATO about its findings as early as July of last year, but obviously, nothing had been done about it.

PAL had been pushing for reforms at the ATO, urging it to upgrade its equipment and have more stringent requirements plus training for its personnel. The FAA noted the country's failure to reach minimum safety standards set by the International Civil Aviation Organization (ICAO) and its outdated regulations which hark back to a 1952 law. Whatever happened to the Civil Aviation Authority bill which ATO has been pushing supposedly to prevent an FAA downgrade?

People are beginning to suspect the creation of a CAA could be just another opportunity for corruption since the agency would be given the freedom to impose its own fees, collect and disburse revenues without any government intervention.

If one can remember, GMA upheld the suspension order of ATO chief Nilo Jatico issued by the Presidential Anti-Graft Commission last year for his alleged failure to liquidate cash advances worth PI.2 million for 2003-2004, and for continually drawing funds above the specified limit—which he denied saying it was the ATO accounting office that failed to remit the amount to the treasury.

GMA's sacking of acting ATO chief Danilo Dimagiba with orders to improve air safety standards within three months seems a bit too late to rectify the problem. There's been a lot of finger pointing regarding the reason for the FAA downgrade. So who's to blame?

But what is quite obvious is that the ATO badly needs a revamp to address bureaucratic ineptitude and corruption which disgruntled employees are complaining about. A little corruption here and there could turn into a major case that can cause billions of wasted taxpayers' money, like the NAIA 3 Terminal which has become a monumental example of corruption for the world to see.

My cousin, Congressman Martin Romualdez along with House Oversight Committee chair Danny Suarez and other House representatives toured the mothballed facility to assess the maintenance and the preparations being taken to make it operational soon. Congressman Suarez said government has already spent $22 million on legal fees alone and to this day, no one has been made accountable for this folly. Danny informed me he has given a May deadline for this airport to open. Let's see what happens.

The FAA downgrade serves as a reminder once again how ineptitude, corruption, and incompetence even at low levels can result in payback that is much bigger—for the one who will most likely suffer the brunt of the downgrade is not just an airline, but the whole country. The trouble is, government officials are more reactive rather than proactive—only moving their butts when the "shit hits the fan." For heaven's sake, when are we ever going to learn?