THE Arroyo government is not interested in going after the Manila Electric Co. (Meralco) but only wants a review of the contracts of independent power producers (IPPs) to lower power rates, Albay Gov. Jose "Joey" Salceda, the President's economic adviser, said yesterday.

Salceda said he had asked the President if reports are true that government is going after Meralco and the President's reply was, "No. I just want a review of the IPPs. I want lower power rates. Period."

In her opening speech during Tuesday's Cabinet meeting, Arroyo said power rates could be lowered only if Meralco would buy at cheaper rates from its own power producers.

She called for support in government's petitions before the Energy Regulatory Commission to bring down Meralco rates.

The political opposition on Monday accused the administration of applying a "power play squeeze" on the Lopez family which owns the power distribution firm.

United Opposition president and Makati Mayor Jejomar Binay has said the squeeze was another Malacañang ploy to blame the private sector for her administration's obvious failure to implement reforms in the power sector and keep the cost of electricity down.

Binay also said the timing of the President's tirade against Meralco could very well be part of a pattern of harassment against Arroyo's "perceived enemies" given the critical stance taken by the Lopez-owned ABS-CBN against government on the issue of restrictions to media.

Sen. Panfilo Lacson has said that Arroyo should focus on backing pending bills seeking to amend the Epira (Electric Power Industry Reform Act) law rather than engage the Lopez family in a proxy fight to force Meralco to slash its rates.

Rep. Roilo Golez (Ind., Parañaque) said the Government Service Insurance System should gradually divest the bulk of its holdings of Meralco stocks to protect its members from financial risks.

GSIS has a 33 percent share in the power distribution firm and holds four seats in the 11-member board.

"The mandate of this GSIS is to diversify its investments to spread out its risks and not expose itself to huge investments in one entity, exposing in the process the interest of GSIS members to undue risk," he said.

Golez, spokesman for the House minority bloc, advised the GSIS management to "desist from getting enmeshed in the corporate affairs of other entities, especially strategic public utilities as that would divert their focus from managing its overall investment portfolio."

"It is not the business of Mr. Winston Garcia to prove that he is better in managing the affairs of Meralco. His mandate is to protect the overall interest of government employees," he said.

Garcia, GSIS president, has said the state pension fund is fed up with the power distributor's lack of transparency and demanded that Meralco open its financial records.

Golez said he is worried that the emerging "proxy war" in Meralco "would distract him (Garcia) from managing the GSIS and could even unduly adversely affect the market price of Meralco shares and consequently the interest of GSIS members."

Malacañang on Monday said it will support Garcia in scrutinizing the financial records of Meralco but would not meddle in any takeover attempt by the GSIS.