Villar slams ACEF release

MANILA, Philippines — Sen. Cynthia Villar has questioned the involvement of the Department of Agriculture in the implementation of the Agricultural Competitiveness Enhancement Fund (ACEF).

In a hearing yesterday, Villar said the DA should no longer be involved in the management of the tariff collections on imports of certain agricultural products under the Agricultural Tariffication Act of 1996.

Villar said the amended ACEF, passed in 2016, should go directly to the Land Bank of the Philippines for credit and Commission on Higher Education and state universities and colleges for technology commercialization and scholarships.

However, Landbank said the DA transferred some P4.16 billion to the agency as of end-July.

“That was the defect of the old ACEF, it was passing through the DA, that’s why the money was lost, 90 percent were bad loans,” Villar said.

In the old ACEF, Villar said about P8 billion had been lost because the borrowers did not pay.

“That is not the intent of the (new) law. No more passing through with the DA because they lost the money before and it just adds to the bureaucracy,” Villar said.

“What happened before, it’s water under the bridge, but for it to happen again? You should stop it,” she said.

Villar, who chairs the Senate Committee on Agriculture and Food, said she was against departments which are giving out loans.

“They are not banks. And no one is regulating the departments if they are giving out loans properly,” she said.

However, the Federation of Free Farmers maintained that it is not clear in the law that DA should no longer be involved.

“The law says the Landbank shall manage the credit facility funded out of the fund. So it looks like the fund is different from the credit funds given to Landbank, and my understanding is that the whole fund is managed by DA and it implies that DA has overall control over the fund,” FFF national manager Raul Montemayor said.

Currently, the fund comes from the Bureau of the Treasury then it goes to the Department of Budget and Management, then to the DA and finally to the Landbank.

“That is the system at present as I know it. It was not clear in the law that the fund should go directly to the Landbank. If that was the intent as she (Villar) claims, she should have reflected it clearly in the wording of the law,” he said.

The ACEF was intended to enhance the competitiveness of local producers affected by trade liberalization when the country joined the World Trade Organization in 1995. The life of the ACEF was extended in 2008 and again in 2016.

The law provided that 80 percent of the ACEF fund balance would be allocated to the Landbank for credit support to farmers and small and medium-scale agricultural enterprises. Ten percent each of the fund would then be appropriated for technology commercialization and scholarships.

The ACEF lending program aims to increase the productivity and incomes of farmers and fishers by providing them with affordable credit to acquire production, post-harvest, processing machinery, equipment and facilities, or buy farm inputs.