Press Release
January 26, 2006

Drilon hits govt failure to push for reduction of
remittance fees collected from overseas Filipinos

Senate President and Liberal Party head Franklin Drilon deplored the governments failure to rationalize the remittances fees collected from overseas Filipinos despite a commitment made by US President Bush during President Arroyos state visit to the United States in May 2003.

During the Committee of the Whole budget hearing at the Senate Wednesday, Drilon told Foreign Affairs Secretary Alberto Romulo that he was disappointed over apparent inaction of the executive department in pushing for the reduction of charges on remittances sent by Filipinos working in the United States to their families in the Philippines.

"The rationalization of the remittance fees has been long overdue. Malacañang keeps on extolling our overseas Filipinos as unsung heroes and with other pompous accolades but all these appear to be paying lip service," Drilon said. "The fact is this government has failed to help them on a matter that hit their pockets literally, such as the high costs of remitting money."

Drilon recalled that during President Arroyos US state visit, the Philippine government was able to secure a commitment from Bush that the US government would "launch a project to facilitate the flow of remittances from Filipino workers around the world back to the Philippines."

In a joint statement, Bush and Arroyo declared the project would "improve the lives of millions of Filipinos by lowering the costs of remittance transactions and make it easier for funds to flow to the Philippines from the United States and around the world."

Drilon noted that Filipino workers abroad could have saved as much as an estimated $300 annually if the Philippine government was able to push for the implementation of the Bush initiative.

"Despite the commitment of the highest US official, the Philippine government has not been able to take advantage of the situation to help our overseas Filipinos on the matter of reduced remittance fees," Drilon lamented.

Drilon noted that during the Senate budget hearings, Banko Sentral ng Pilipinas (BSP) Executive Director Celia Gonzales testified that overseas Filipino workers (OFWs) remitted a total of $10.3 billion to the Philippines in 2005 and paid over $500 million on remittance fees.

An estimated eight million Filipinos work abroad and regularly remit money to their families in the Philippines. Filipinos pay an average of $5 for every $100 they remit through the banks or courier to the Philippines, Drilon noted.

Both Romulo and Gonzales, Drilon said, admitted that the Arroyo administration has not been able to push for the reduction of remittance fees.

Romulo told Drilon that the Bush-Arroyo initiative to rationalize the remittance fees for OFWs could not be implemented because the Philippine embassy in Washington has yet to secure a clearance from the UD Federal Bank and other federal agencies.

The Bush initiative called for the establishment of an official mechanism in which Filipinos could send money to their relatives through well-established banks or other safe and official channels at reduced cost.

"This agreement was initiated for years ago but up to now the Arroyo administration has not been able to do anything about it," Drilon lamented.

In his testimony, Romulo said he would direct Philippine Ambassador to the United States Alberto Del Rosario to explain why the agreement between Bush and Arroyo to reduce remittance charges has not been implemented.

"I will relay to him the unhappiness of certain people here about this matter," Romulo said. To which Drilon replied: "This is not only my concern. This is the cause of unhappiness for the over seven million Filipinos abroad who pay high remittance charges."

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