First of Three Parts

BY ALL ACCOUNTS, the May 10, 2010 polls was the costliest ever in Philippine electoral history.

The top candidates for president and vice president alone spent P4.3 billion on political ads during the official 90-day campaign period, and another billion 90 days before the campaign commenced, according to Nielsen Media’s monitoring of tens of thousands of political ad clips.

But for various reasons, the May 10, 2010 elections could also go down in the country’s annals as a grand spectacle of lies, half-truths, and concealed truths foisted on the Filipino voters.

These reasons include:

  • Porous campaign-finance laws and inconsistent interpretation of the specific provisions by the Commission on Elections (Comelec);
  • The negligence and inability  of the Comelec to enforce these laws for reported lack of trained manpower, time and resources;
  • An apparent pattern among most candidates, political parties, and their representatives to circumvent the laws in a “knowing and willful” manner;
  • A patent conspiracy among candidates, political parties, party-list groups, and donors to defy the laws; and
  • Uneven compliance by media agencies and service contractors with their reporting duties.

Overspending, misreporting, concealment of facts by the top candidates for president, vice president, and their political parties and associated party-list groups – these are among the findings of the PCIJ’s audit of the Statements of Electoral Contributions and Expenditures (SECEs) that the candidates and parties submitted to the Comelec, along with related documents.

Nacionalista Party presidential candidate Manuel B. Villar Jr. and the Pwersa ng Masang Pilipino (PMP) party of former president Joseph Estrada, for example, had clearly spent beyond lawful limits, if the Comelec were to enforce campaign finance rules strictly and audit advertising contracts they signed with media agencies. PMP had not filed its report on election expenses and donations as of Comelec’s extended deadline last June 25.

Four candidates for president (Villar, Estrada, Lakas-Kampi-CMD’s Gilberto Teodoro Jr., and President Benigno Simeon C. Aquino III of the Liberal Party) and three candidates for vice president (Vice President Jejomar Binay of PMP/PDP Laban, LP’s Manuel Roxas II, and NP/Nationalist People’s Coalition’s Loren Legarda), as well as their political parties, failed to fully document and submit consistent reports about their receipt and acceptance of donations from various sources.

In addition, Aquino, Villar, Roxas, and Senate President Juan Ponce Enrile had separate deals with about a dozen party-list groups on tandem TV ads that essentially had their personal ads piggybacking on these groups’ allowed airtime. These ads, which aired in the last two weeks of the campaign, were not counted as part of the four candidates’ respective airtime limits.

To verify the data enrolled in the SECEs, PCIJ reviewed all available advertising contracts and telecast orders that the media agencies had submitted to the Comelec, Nielsen Media’s database on its monitoring of political ads, and other public records on the country’s top taxpayers and the corporate assets of the top campaign donors.

PCIJ also interviewed the treasurers and official representatives of the candidates and the parties, as well as some donors and fund raisers from the business community.

PCIJ’s audit, however, was hindered by the incomplete data supplied by candidates and political parties in their SECEs, as well as the absence of any or most of the required documents by many media outfits, especially those from print.

In part, that may be because no one has ever been prosecuted by the Comelec for non-submission of the required documents or for filing SECEs or other papers that are incomplete.

Comelec spokesperson James Jimenez also admitted to PCIJ that the SECE itself is “not a sharp instrument,” although the commission assumes that the candidates exert “all efforts to be as transparent in the statement as possible.”

Then again, it’s not as if Comelec has the means to verify the data on most of the documents it receives. Asked if Comelec had an auditing system, the body’s Legal Department head Ferdinand Rafanan said, “You know, I’m not even prepared to answer that because there simply is none. There is no auditing system.”

He also said that they have no time to go over the documents submitted by candidates, political parties, media outfits, and other entities. His own department, he pointed out, has only 30 people. “How can these…30 people examine tens of thousands…submitted to us?” asked Rafanan. “We do not simply have the time.”

“(We) have no capability to do that by training,” he added. “And we have never done it.”

Last month, the PCIJ presented the results of its own audit attempts to the Comelec en banc, partly in response to the poll body’s request for the PCIJ and the Pera’t Pulitika 2010 Consortium to help monitor the election spending reports of the candidates and the political parties. Some of the highlights of the PCIJ presentation include:

For the Aquino-Roxas slate, the Liberal Party, and the five party-list groups allied with them

In their separate SECEs, Aquino and Roxas said they spent P403.12 million and P279.35 million in campaign expenses, respectively. Both figures are within lawful limits.

Documents filed by both candidates with Comelec, however, did not reflect the barrage of ads that featured them but were supposedly purchased by their allied party-list groups Akbayan! Citizen’s Action Party (Akbayan), Katipunan ng mga Anak ng Bayan (Kaakbay) and Parents Enabling Parents (PEP). Aquino was also featured in ads placed by Agricultural Sector Alliance of the Philippines (AGAP) and An Waray.

The PCIJ found no evidence that Aquino or Roxas accepted or authorized these groups to buy ads to help promote their candidacies. Yet if it weren’t for the end tags that flashed the names of the party-list groups for a mere second, viewers would have no way of identifying the ads with the party-list groups that are listed as “advertisers,” since the focus was on the LP bets.

Interestingly, these party-list groups emerged as ad buyers in the country’s top leading networks only beginning in late April. And in just eight days, Aquino and Roxas were endorsed in 1,193 and 869 ads, respectively, of these five groups, based on Nielsen data.

If the cost of these ads were counted as his own expenditures, Aquino would have gone beyond his P507-million authorized expenditure limit for national candidates. But with no deed of donation of ads or even letters of acceptance of the donations filed with the Comelec by the groups and Aquino, the ad expenses were not declared nor counted in his name.

In his 267-page SECE, Aquino listed expenses on “political advertisements” in 16 companies worth P370.96 million, or 92 percent of his declared total campaign spending.

The ad booking orders for Aquino, issued by his ad agency and valued at P169.50 million, were signed by relatives Jaime C. Lopa and Maria V. Montelibano, who were both authorized by Aquino to incur expenses on his behalf. The Liberal Party also signed contracts with ABS-CBN Corp. worth P69.74 million for Aquino’s ads.

A letter issued by LP chairman Roxas on March 8, 2010, authorized Aquino to avail himself of half the party’s allowable air time – 60 minutes of TV airtime and 90 minutes of radio airtime per station. The letter further states that “this authority shall include the right to incur expenses chargeable to, and in the name of, the Liberal Party up to the amount of One Hundred Twenty-Five Million Pesos (Php125,000,000.00).”

Meanwhile, in his 38-page SECE, Roxas reported spending P232.06 million on “media,” which represents 83 percent of his total campaign expenses.

Ad contracts between Roxas and ABS-CBN Corp., and media purchase orders issued by Roxas’s ad agency to GMA Network, Inc. and TV5, come up to P195.44 million in total, or much less than what he declared in his expenditure report.

Yet in addition, LP bought P21.24 million worth of ads for Roxas, according to advertising contracts with ABS-CBN Corp. (P20.64 million) and a media purchase order issued by Image Dimensions to TV5 on LP’s behalf (P592,704).

The PCIJ found no letter of acceptance from Roxas for the expenditures LP had incurred in his name.

For the Villar-Legarda slate, the Nacionalista Party, Nationalist People’s Coalition, and party-list groups allied with them

The ad contracts signed by Senator Villar’s brother and authorized representative, Virgilio Villar, with the TV networks show that the presidential candidate’s ad buys amount to much less – P152.2 million – than what Villar himself declared to the Comelec for the duration of the official campaign period. Villar’s SECE says he spent P285.4 million in “campaign ads.” The discrepancy may be due to the “missing” contracts or those that a number of big radio networks and newspapers failed to submit to Comelec.

Yet in addition to his personal ad buys, Villar’s Nacionalista Party bought P150.4 million worth of ads on ABS-CBN, TV 5, Solar, and GMA 7. These contracts were signed by either NP executive vice president Jerry Navarrete – a long-time senior officer in Villar-owned companies – or NP treasurer Juan Pablo Bondoc.  These ad contracts listed either “Manny Villar” or the “Nacionalista Party” as “candidate” but were all paid by NP.

Meanwhile, the telecast orders that NP’s media agency Starcom Philippines issued to GMA 7 and its blocktimer TAPE Inc. listed the Nacionalista Party as both the “client” and the “brand.”

However they are booked or credited, though, all NP ads should have been billed to the account of Villar himself, documents from the Villar camp show.  These papers include the deed of donation of all the NP’s allowable advertising credits to Villar and the acceptance of the donation by Villar and his brother Virgilio.

Attached to the advertising contracts that the Villar camp signed with the networks were:

  • A letter signed by Navarrete stating that NP “is availing (itself) of its allowable airtime under RA 9006 to promote the candidacy of Manuel B. Villar, Jr as follows: 1) Television ad placements for the candidate: 120 minutes; 2) Radio placements for the candidate: 180 minutes.”
  • A letter signed by Virgilio Villar, “duly authorized representative of Manuel B. Villar, Jr.,” accepting the “donation of political ad placements in radio and television from Nacionalista Party.” (No amount, however, is indicated in the letter.)
  • A Special Power of Attorney signed by Manuel B. Villar, Jr. appointing Virgilio B. Villar as his “true and lawful attorney-in-fact” allowing the latter to “sign, execute and deliver all contracts, agreements and/or documents related to all political advertisements and placements in television, radio, and print for the entire duration of the 2010 Election Period, within the limits allowed by law.”

A review of the TV commercials involved reveals as well that not only is Villar featured in the ads “paid by” the Nacionalista Party ‘”for Manny Villar,” but also in ads “paid for Nacionalista Party.” This means NP’s declared campaign ad expenditure of P152.8 million should have appeared in Villar’s statement to the Comelec as “contribution received” and “expenditure incurred.”

Villar’s statement however, does not indicate any contribution at all from any entity. Comelec lawyers say that such an omission in the SECE, if proven, could be a case of falsification or perjury.

Moreover, the amount would raise Villar’s actual expenditures to P584 million – or P77 million more than the P507 million a presidential candidate was allowed to spend (P10 per voter for an estimated 50.7 million registered voters in the May 2010 elections).

But then six party-list groups had also bought TV ad spots that invariably featured the candidacy, image, and message of Villar: Association of Administrators, Professionals and Seniors (AAPS); Alyansa ng mga Grupong Haligi ng Agham at Teknolohiya Para sa Mamamayan (AGHAM); Alay Buhay Community Foundation (Alay Buhay); Buhay Hayaan Yumabong (Buhay); Butil Farmers Party (Butil); and Pwersa ng Bayaning Atleta (PBA).

These party-list groups entered into contracts with ABS-CBN Broadcasting Corporation, GMA Network Inc., Solar Entertainment Corporation, and TAPE Inc. for the airing of political ads that altogether were worth P417.6 million.

The media agencies that placed Villar’s ads — Starcom Philippines and PHD Media Network 2006, Inc. – also happen to be the same ones that handled the ad placement of all six party-list groups.

In addition, Starcom Philippines issued a number of telecast orders to GMA Network and Tape Inc. that listed “Friends of 2010” as the “client” that paid for P10.5-million worth of ads for Villar, as well as P14.8 million for the Nacionalista Party.

If the P14.8 million were added to NP’s advertising contracts worth P150.4 million, NP’s campaign ad spending would amount to P165.2 million. In its SECE, the NP declared total spending of only P152.8 million for “campaign ads,” or an understatement of about P12.4 million.

Compared to the Villar camp’s rather complex booking of ad expenses, that of the senator/real-estate tycoon’s running mate was straightforward.  Not only were all of Legarda’s unique ads booked by her political party Nationalist People’s Coalition (NPC), Legarda and the NPC also correctly reflected these in their respective SECEs.

The NPC, through its president, Frisco San Juan, entered into contracts with ABS-CBN 2 and Solar Entertainment for several ads featuring Legarda. NPC’s ad agency OMD Philippines likewise issued media purchase orders to GMA 7 naming the NPC as the “advertiser” and either its vice presidential candidate Loren Legarda or NPC as the “product.”

A letter signed by San Juan saying that the NPC is “availing (itself) of its allowable airtime … to promote the candidacy of Loren Legarda,” is also attached to a number of these contracts.

In its SECE, the NPC reported expenditures of P173.9 related to “Advertising/Media.” Under this category is listed the amount of P162.5 million paid to Antonio B. Legarda, Sen. Legarda’s authorized representative.

The amount of P162.5 million also appears in Legarda’s SECE under contributions received, with “NPC (Frisco San Juan)” listed as the contributor. Legarda’s summary of expenditures, however, showed a higher amount of P175 million spent for “Advertising/Media.”

If the P254.5-million cumulative worth of all the ad contracts signed by the NPC on Legarda’s behalf were to be considered though, it would appear that NPC overshot its spending limit and did considerable underreporting in its SECE.

For the Estrada-Binay slate, and the Pwersa ng Masang Pilipino and Partido Demokratiko Pilipino-Lakas ng Bayan

 

As of press time, the PMP had not submitted its SECE to Comelec. This puts its winning candidates, Senator Enrile and Estrada’s son, Senator Jose ‘Jinggoy’ Ejercito Estrada, in clear peril of Comelec Resolution No. 8944, which states, “No person elected to any public office shall enter upon the duties of his office until he has filed the statement of contributions and expenditures.”

The same prohibition applies if the political party which nominated the winning candidates fails to file the required statement.

Estrada himself, however, submitted his SECE, in which he says he spent P112.50 million on “radio and TV advertisements.” Advertising contracts submitted by various broadcast networks meanwhile show that the PMP had ad buys worth at least a total of P261.18 million. This figure is already about P7 million over the allowed expenditure for political parties.

Not all of the ads paid for by PMP were for the party, however. About 75 percent (P193.71 million) of the P261.18 million went to ad spots for Estrada, or P81.21 million more than what Estrada declared as having spent for radio and TV ads in his SECE.

Documents show, though, that only P107.07 million worth of PMP ad contracts carried the line “Donation Accepted By: Joseph Ejercito Estrada (Donee)” or “Donation Accepted By: Jesse M. Ejercito (Donee) – Finance, Pwersa ng Masang Pilipino,” affixed with the donees’ respective signatures. (Ejercito is Estrada’s brother.)

In other words, only these ads would appear to have been accepted by Estrada and were authorized party expenditures for him. Media purchase orders issued by PMP’s agency MediaVest Philippines to the other networks do not have any similar note or attachment to indicate Estrada’s acceptance of the ads bought for him by PMP.

Estrada’s running mate Binay also had ads placed by his own party, PDP-Laban. According to ad contracts entered with ABS-CBN Corp. and telecast orders issued to GMA Network, Inc., the party bought ads for Binay worth P35.31 million and P26.72 million, respectively.

Binay, however, seems to have accepted only P24.99-million worth of ads PDP-Laban placed  for him in ABS-CBN Corp. based on  two contracts with the network that bear the line “Donation Accepted By: Jejomar ‘Jojo’ C. Binay (Donee)” affixed with Binay’s signature. Had he accepted the rest, the combined value of his ads in just ABS-CBN and GMA Network would reach P205.75 million, which would already be P4 million more than what he declared in his SECE as his total ad expenditure.

Indeed, the present vice president and his party also seem to have done some juggling of ad airtime and expenditure credit especially at the campaign homestretch, as a series of memos pertaining to a contract that PDP-Laban (through Media Force Vizeum) had signed with ABS-CBN illustrates.

The contract covered 68 30-second ad spots, worth a total of P20.6 million, that were to run from April 8 to May 8 on ABS-CBN. While the document identified PDP-Laban as “advertiser,” no name was indicated as PDP-Laban’s representative. Instead, the same signature appeared for PDP-Laban and its ad agency, Media Force Vizeum. Below the signatory line was the phrase “Donation accepted by: Jejomar ‘Jojo’ Binay (Donee),” which was signed by Binay.

But on April 29, ABS-CBN Corp. account executive Asela Tagarao sent a memo to Comelec, saying the old contract would be “superseded” by a new contract naming Binay as the “advertiser” instead of PDP-Laban. The contract amount and coverage remained the same.

On May 5, however, Tagarao issued another memo to Comelec, this time asking the commission to “disregard the contract … with advertiser detail: Jejomar ‘Jojo’ Binay” and “revert” to the “old contract with advertiser detail: PDP-Laban.”

The value of PDP-Laban’s ad contracts with ABS-CBN Corp. and telecast orders with GMA Network, Inc. alone amounted to P98.84 million. But in its election expense report to Comelec, the party listed a very modest P4.99 million as its total campaign expenditure.

PDP-Laban’s expenditure report was likewise lacking in detail, as it listed only P457,030 for political ad expenses, all of them in print media.  The party also failed to account for the donors of the multimillion-peso TV ad spots it purchased; it declared receiving contributions of only P5 million.

For Teodoro and Lakas-KAMPI-CMD

The former ruling coalition Lakas-Kampi-CMD says in its SECE that it received contributions totaling P130.68 million while it spent about 81 percent or P105.68 million of its total expenditures for “newspaper, radio, television and other public advertisements.”

Contracts and telecast orders from networks show that the party’s ad expenditures in these reached at least P86.02 million. Of this amount, P60 million worth of ads were aired in ABS-CBN, although it is not specified for whom these were bought. But those placed in GMA Network, worth P25.48 million, were for its standard bearer Teodoro, while P530,000 worth of ads in People’s Television Network, Inc. were for senatorial candidate Silvestre Bello III.

Only a contract entered with ABS-CBN Corp. by Lakas, dated April 13, 2010, carries the line “Donation Accepted By:” along with the signature of the donee. The donee’s signature is very similar to Teodoro’s signature that appears in his old statements of assets, liabilities, and net worth (SALN) filed before the House of Representatives.

If this contract is indeed signed by Teodoro, the ad cost of P1.70 million as indicated in the document should have been reported in his SECE, but it was not.

In his SECE, the former national defense secretary said his total campaign expenditures came to only P3.46 million, which was spent on concert, food, accommodation, transportation, and miscellaneous items. No ad expenditure was listed.

The SECE also lists Teodoro’s contributions received as P64,688.88 only.

— With additional research and reporting by JC Cordon and Annie Ruth Sabangan, PCIJ, August 2010