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Former Pemex chief Emilio Lozoya, left and union leader Romero. Former Pemex chief Emilio Lozoya, left and union leader Romero.

New contract means 1.3-billion-peso party is over for Pemex union

Special slush fund: a history of patronage and corruption

Government largesse towards the Pemex workers’ union perpetuated by three past presidents appears to have come to an end.

Vicente Fox, Felipe Calderón and Enrique Peña Nieto handed over more than 1.3 billion pesos (US $65.5 million at today’s exchange rate) to union leaders between 2005 and 2018 to pay for travel, commemorative festivities and consultancy fees, the newspaper Milenio reported today.

The funds were provided under Clause 251 of the collective agreement between the state oil company and the Pemex union. The latter had no obligation to reveal how the money was used.

The magazine Americas Quarterly today described Clause 251 funding as “a type of slush fund for the union’s leadership committee used for everything from alcohol to anti-wrinkle cream.”

However, in the union’s 2019-2021 contract with Pemex, which took effect on August 1, Clause 251A – which funded consultancy and celebrations for International Workers’ Day and the anniversary of the expropriation of the Mexican oil industry – was eliminated.

Other Clause 251 funding was slashed by almost 80%, although 343 national executive committee commissioners and 36 union secretaries retain reduced travel allowances.

The cuts are part of wider austerity measures implemented by the federal government.

According to Alfonso Bouzas Ortiz, a researcher at the National Autonomous University who specializes in labor issues, union leaders such as Carlos Romero Deschamps have used Clause 251 funding for their own personal enrichment for years.

Clauses 251 and 251A “have a history,” Bouzas said, explaining that it is one of political patronage and corruption.

“. . . They’re profoundly corrupt clauses,” he charged, pointing out that they provided for excessive travel allowances, bonuses and other unjustifiable perks.

Bouzas told Milenio that government resources have also been diverted by the Pemex union to the Institutional Revolutionary Party (PRI) to help fund election campaigns.

Former president Peña Nieto and Romero.
Former president Peña Nieto and Romero.

The most infamous example is the so-called Pemexgate scandal in which the Pemex union was found to have diverted 500 million pesos to the 2000 presidential campaign of PRI candidate Francisco Labastida.

Romero Deschamps, who became Pemex union leader in 1993 and has sat in both the lower and upper houses as a PRI lawmaker, always denied the charge and the case against him was dropped in 2006 due to a lack of evidence.

However, the Finance Secretariat’s Financial Intelligence Unit (UIF) last month filed criminal complaints against the union leader and members of his family for money laundering and illegal enrichment.

Claims of Romero’s corruption have been fueled over the years by opulent displays of wealth including a lavish wedding for his daughter in 2017.

Earlier this year, a group of dissident members of the Pemex union accused Romero of illegally selling off union property for personal gain.

“Groups within the union have wrestled for years to get Deschamps removed,” Lilia Pérez, author of Pemex RIP, told Americas Quarterly.

“But the circumstances are different this time, first because of the UIF and second because he doesn’t have legislative immunity.”

However, Americas Quarterly said that Romero – who is still officially the head of the union –  continues to enjoy strong support among the 100,000 Pemex union members, adding that Mexican law may be on Romero’s side because a constitutional reform in 2011 and 2016 justice reforms have given defendants “wider recourse against state investigations.”

“The law now better protects defendants’ rights, which is as it should be,” said Martín Vivanco, a Mexican lawyer and academic.

“. . . In Mexico, if you say the word corruption, [Romero] Deschamps would be one of the first names that comes to mind. But big fish know exactly how the legal system works, and as reported the charges against him would be very hard if not impossible to prove.”

Source: Milenio (sp), Americas Quarterly (en) 

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