Press Release
March 13, 2018

Statement on the Second Reading passage of Coconut Farmers and Industry Development Act
Senate President Pro-Tempore Ralph G. Recto
13 March 2018

Coco Levy Funds Will Remain a Trust Fund Controlled by Farmers But Made Bigger Through a P10 B Annual Counterpart Fund From The Gov't

Bigger Funds

The original proposal was for a Coconut Industry Development Fund that will only use interest income from the coco levy trust. This will amount to P2 billion to P2.5 billion a year. Pero bakit coco levy lang ang gagamitin? Bakit hindi magbigay ng counterpart fund ang pamahalaan? Thus, the Senate version adds a guaranteed budgetary support of P10 billion to the PCA on top of trust income.

Faster Recovery

The original proposal was for a "perpetual" rehabilitation of an industry in crisis. The bill mandates a 25-year timeframe. If the patient is in ICU, then the treatment must be immediate, and the assistance massive. Kung namamatay na sa uhaw, bakit isang kutsarita lang ang ibibigay, through a drip-drip of funds? When World War II ended and Pinatubo erupted, the government vowed quick and not "forever" rehabilitation. Ang gusto ba natin sa Marawi at Yolanda reconstruction walang katapusan din?

Safer Investments

The trust will be invested in the safest instrument there is, the Republic-backed government securities.

Simpler Administration

The original proposal called for a creation of a 13-person Trust Committee, separate from the PCA, plus a multi-agency ad hoc committee that will draft the "Coconut Industry Road Map."

Why create so many bureaucratic layers and overlaps, when it can be done by an expanded and strengthened PCA, dominated by farmers, who will occupy 6 out of the 11 seats? Kung isa lang ang paglalagakan ng pera at wala nang ibang investment picks, bakit pa bubuo ng hiwalay at napakalaking grupo na mangangasiwa? If the spending is pursuant to a farmers-drafted roadmap, then why create a bigger and separate oversight committee?

Empowered Farmer-Dominated PCA

There is no government agency today that is by law dominated by private individuals. The proposed expanded PCA breaks tradition by reserving majority of seats for farmers. The PCA will be the lead initiator of the Coconut Industry Roadmap, in which all stakeholders will participate. It will be empowered with the right to ratify the stewardship or disposal of coco levy assets. Why maintain two bodies, when, for purposes of efficiency, transparency, accountability and savings, it can be done by one body--the PCA--that is dominated by coconut farmers?

The Coco Levy Will Remain a Trust Account, But Will Be Transparent

It will remain a trust fund, but not the typical hidden Off-Budget Account like the Malampaya and Road Users Tax Funds. The fund will remain a trust account, but its usage, reporting, and expenditure will strictly follow budget, accounting, procurement and auditing rules. The trust income to be spent pursuant to the industry roadmap will be determined by the PCA and line-itemized in its budget. It will not be considered new appropriations, which means that while it can be subject to scrutiny, it cannot be spent for other purposes.

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