Press Release
March 5, 2007


Senate Minority Leader Aquilino Nene Q. Pimentel, Jr. (PDP-Laban) today said President Gloria Macapagal-Arroyos approval of an out-of-court settlement on the coconut levy cases reflects her administrations confused and deficient handling of this issue which has aggravated the misery of the small farmers and farm workers.

Pimentel said it is ridiculous that the Arroyo government would now pursue a compromise agreement with the coconut farmers and other stakeholders in the coconut industry after revoking a similar agreement forged during the Estrada administration in order to allow the courts to resolve the conflict over the issue of ownership of the coconut levy assets.

Why did President Arroyo invalidate the Estrada-initiated compromise agreement upon her assumption of office in 2001 only to allow a similar deal six years after? Does this mean she is now admitting that it was a blunder on her part to have discarded the original compromise deal? the minority leader asked.

If the earlier out-of-court settlement had not been revoked, Pimentel said the farmers would have long benefited from the resulting unfreezing of the coconut levy funds that are invested in shares of stocks of the San Miguel Corporation.

He said the proposed compromise accord under the auspices of the Arroyo presidency the Presidential Commission on Good Government has adopted the establishment of a private foundation that will manage the levy funds which was one of the main features of similar agreement forged during the previous administration.

Pimentel said the Arroyo government owes the coconut farmers and the Filipino people an explanation why it is now favoring an out-of-court settlement when the courts have issued a series of rulings on the coconut levy cases that favor the government and the coconut farmers.

He said the Sandiganbayan, in a decision issued in May 2004, held that the 27 percent shareholdings in the SMC, originally acquired through coconut levy money should be considered of public funds for the benefit of the coconut farmers.

The decision was issued after the Sandiganbayan was ordered by the Supreme Court to resolve the issue. Subsequently, there was a motion filed with the Sandiganbayan to execute the decision, but this has not been acted by the anti-graft court.

Why is the government working out a compromise agreement at this stage of the litigation process? Normally, you enter into a compromise agreement before or during the middle of the litigation, but not when a decision has already been rendered by the court, Pimentel said.

He said the governments stand to abandon the court process in favor of an out-of-court settlement is a disservice to the late PCGG Chairman Haydee Yorac who was principally responsible for the legal victories that the government has scored on the coconut levy cases before the courts.

Pimentel said the coconut levy assets in the form of SMC shares, with a current estimated value of P130 billion, belong to the farmers and any compromise deal in which they would be shortchanged of the benefits due them should be junked.

The coconut levy money belongs to the coconut farmers in the first place. A compromise that does not take into account their welfare should not be allowed to happen.

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