PCA to request add’l budget from DBM to fulfill some Coco Levy Act deliverables

Published March 2, 2021, 5:00 PM

by Madelaine B. Miraflor

The Philippine Coconut Authority (PCA) will request an additional budget from the Department of Budget and Management (DBM) to fulfill some of its deliverables under the Coco Levy Act or Republic Act (RA) 11524, including the task of providing health and medical protection to coconut farmers.

In an ambush interview, PCA Administrator Benjamin Madrigal told Business Bulletin that the provision of RA 11524 to provide health and medical protection for coconut farmers will require his agency to form another Special Unit.

PCA Administrator Benjamin Madrigal, Jr. ( Photo credit: https://pca.gov.ph)

To recall, PCA has been tasked to be the lead implementing agency of RA 11524, which allows the release and utilization of the P100-billion coco levy fund, the tax exacted from farmers during the Marcos Administration from 1971 to 1983. 

The RA 11524 directs the Bureau of Treasury to transfer from the accumulated coconut levy at least P75 billion in the next five years to the Coconut Farmers and Industry Trust Fund (CFITF).

Of this, P10 billion each will be released for this year and in 2022; P15 billion each on 2023 and 2024; and P25 billion in 2025, plus any amount accruing, including interest of the coconut levy, in the special account in the general fund.

“Part of the fund is to have health and medical protection for coconut farmers. That is why PCA will form a special unit. PCA is asking for additional funds for this,” Madrigal said.

Though he didn’t specify how much, he said the fund should help the agency get more people to fulfill this particular role. 

For this year, PCA will have a budget of P1.2 billion under its regular fund, which is higher compared to the P963.52 million budget the agency received in 2020.

Aside from the health and medical protection for coconut farmers, the other deliverable of PCA under RA 11524 includes the memorandum of agreement (MOA) it must draft and forge with the law’s other implementing agencies, including the Department of Trade and Industry (DTI), Department of Public Works and Highways (DPWH), Technical Education and Skills Development Authority (TESDA), Department of Science and Technology (DOST), LandBank of the Philippines (LANDBANK), and Development Bank of the Philippines (DBP), among others. 

PCA is also required to come up with an updated National Coconut Farmers Registry System (NCFRS) as well as a medium to long-term coconut industry roadmap, which will be done in consultation with coconut farmers.  

In anticipation of the passage of the coco levy law and the enormous responsibilities that the Authority is bound to face, PCA has already undertaken significant organizational transformation initiatives that aim to transform it into a more efficient and capable organization that is responsive and proactive to the concerns of the coconut industry.

To enhance its capacity to effectively perform its mandate, PCA is now following a comprehensive transformation roadmap under the Performance Governance System (PGS) of the Institute for Solidarity in Asia (ISA).

The Authority is also undergoing critical organizational review in consonance with the provision of the law to reconstitute and strengthen the PCA.

The signing of RA 11524 had upset the local coconut industry because it contains provisions that farmers consider unfavorable.

The last group to air their concerns about RA 11524 was the Federation of Free Farmers (FFF), who criticized the law for excluding coconut farmers in the CFITF.

RA 11524 mandates the creation of a 50-year CFITF, which will be managed by a committee that will set the investment priorities for the coconut industry and the P100-billion coco levy fund.

Unfortunately, farmers will not be part of this committee, which will be led only by authorized representatives from the DBM, Department of Finance (DOF), and Department of Justice (DOJ).

The committee is also tasked to set the trust fund’s investment themes, asset allocation, and policies; evaluate assets; issue guidelines for portfolio turnover and CFITF management expenses; set annual allocation of the CFITF; and approve financial requirements.

Since last year, KILUS Magniniyog, a group of different farmers’ organizations, has been airing their concerns about the Coco Levy Act, even asking Duterte to veto it.