Payment of 2% surcharge for late payment: City asks VECO for exemption

CEBU, Philippines - The Cebu City government has asked the Visayan Electric Company (VECO) to exempt it from paying the 2 percent surcharge on its electric bills that are not paid on time.

This as VECO decided to impose the surcharge for late payments to also include the accounts of local government units and other government agencies.

The city government pays about P10 million per month to the power distributor. The request to be exempted from the surcharge lies on the delay in the processing of the papers for the release of the payment, which takes about 14 days.

VECO gives its customers only nine days from receipt of the bill to settle the account. This is based on the guidelines of the Energy Regulatory Commission.

The weekends are included in the nine-day period given to power consumers.

If this is imposed, the city expects to pay an additional P200,000 per month.

The city’s budget for power is only P90 million for the year 2011. This is not even enough to cover the total for the year much more if there would be surcharges.

Also, the payment of surcharges is not allowed by the Commission on Audit (COA).

VECO Vice-President for Customer Service Group and Administration Ricardo Lacson, Jr. said that they imposed surcharges starting last April.

“The surcharge is within the ERC standards and it is true for all of our customers.” Lacson said.

Lacson said, VECO’s sister company in Davao has been imposing surcharges even to accounts of local government units and they have seen that it is possible for the government to pay on time.

“We encourage all local government units to process their payments on time.” Lacson said.

“We have spoken with the Cebu City officials and they agreed to work on it,” he added.

In a separate interview, City Administrator Jose Marie Poblete said that they will request VECO to continue exempting the city government because there are factors affecting the delay in the processing of payment, which are sometimes already beyond their control.

“We have different accounts with VECO and we do not receive the bills altogether. So they are not processed at the same time. Besides, we will have a problem with COA later on because COA will not allow us to pay the surcharge. As a government unit, we are expected to act on all transactions on time but we have to consider that we have a long process,” Poblete said.

Accounting clerk Heidi Abella-Consul, who is in-charge of the payments of all electricity bills, phone bills and water bills, said that there is no way the city will be able to process the payments within the nine-day leeway.

“Gisulti-an na baya namo ang VECO na iparehas ang billing cycle sa tanang accounts sa syudad, pero wala man nila buhata. During our dry run, nahimo man in 14 days. We told them we can do it in 14 days, granting there is no problem along the way,” Consul said.

Consul explained that the bills, once received, pass through a lot of processes before the checks are released for payment.

Once she receives the bills, she prepares the Obligation Request Allotment (OBR) and the disbursement voucher.

Then the OBR and voucher go for signature to the General Service Office for regular offices, demand offices, street lights and schools account. Special accounts like the traffic lights and the market go to City Traffic Operations Management Office and Market Administrator, respectively, for signature.

After the OBR and the voucher is signed, it is submitted to the City Budget Office for budget control. Then it goes to the Accounting Office for pre-audit and numbering of voucher. After the voucher number is issued, it goes back to Consul for indexing.

Then it is submitted again to the accounting office for another pre-audit.

If all requirements are met, the City Accountant will sign the voucher.

It will then be submitted to the City Treasurer’s Office and to the Office of the City Administrator for signature.

After the city administrator signs the voucher, it goes back to the CTO for the preparation of the check.

The Check is signed by the CTO and the City administrator before it is submitted back to the City Accountant who will issue the Accountant’s Advice required by the bank to release the checks.

The city has 40 accounts for schools, 20 accounts for regular offices, 80 accounts for traffic lights, eight accounts for demand offices, four accounts for hospitals, four accounts for streetlights and two accounts for South Road Property street lights.

The bills for these accounts arrive by batches so Consul also processes them by batches.

Consul said that during the meeting with VECO representatives, they did not promise to pay the surcharge because it will surely be suspended during the pre-audit.

She said that VECO will have the same fate as the Metropolitan Cebu Water District which also tried to impose surcharges to the city government in the past but did not push because it was not permitted by COA. –/NLQ (FREEMAN)