BEYOND BUDGET

Assalamu alaikum wa Rahmatullahi wa Barakatuh.

We greet October with the commemoration of National Cooperative Month, which seeks to highlight the significant contribution of cooperatives to the country’s economic growth. This observance paves the way for the Cooperative Development Authority (CDA), in conjunction with the cooperative sector, to implement activities and programs to promote cooperative principles and values and foster the cooperative movement.

Cooperatives contribute immensely to the steady development of our country’s economy. They provide education, training, and information to members, elected representatives, managers, and employees, and work towards long-term community development through member-approved policies.

Cooperatives are garnering international recognition for their potential in supporting the Sustainable Development Goals (SDGs), including job creation, poverty reduction, and environmental sustainability. In fact, United Nations Secretary-General Antonio Guterres in the 2023 UN Secretary-General report on cooperatives in social development, lauded cooperatives' contributions to social inclusion, economic development, and environmental protection. The report emphasizes not only the transformative potential of cooperatives but also highlights the need to strengthen their entrepreneurial ecosystems to support and empower them to tap their potential to contribute to the economic and social well-being of nations and their people. 

In the Philippines, as of 2022, there is a total of 20,105 cooperatives with 12.1 million members with over 334.3 thousand employees, collectively generating a business volume of ₱525.8 billion, a total asset of ₱623.2 billion and a net surplus of ₱26.9 billion. Nationwide, out of 82, there are 76 provinces with existing cooperatives.

Thus, we believe that the Cooperative Month theme, “Cooperatives: Pioneering the path to recovery amidst modern challenges of climate change and food security” is both timely and fitting. It underscores the critical role of cooperatives in addressing contemporary global challenges, serving as catalysts for sustainable agriculture, resilience against climate change impacts, and ensuring food security. Their collaborative and community-oriented approach is instrumental in fostering recovery and building a more secure and environmentally sustainable future for all. 

It also manifests our government’s commitment to strengthen cooperatives to support our 8-Point Socio-economic Agenda. It underscores the crucial role they play in addressing global challenges by promoting sustainable agriculture, resilience against climate change, and food security through their collaborative and community-oriented approach.

Our Philippine Development Plan (PDP) 2023-2028 envisions cooperatives as active players in uplifting the economy and making the lives of our people better, ensuring inclusive growth for all, including those of future generations.

Anchored on the objectives of the PDP, the Department of Agriculture (DA) and CDA will strengthen agricultural cooperatives by improving coordination mechanisms. The DA will lead development interventions for smallholder farmers, ensuring a multi-sectoral approach. The government will develop alternative platforms for financial literacy programs, and enhance awareness campaigns on financial products and services.

President Bongbong Marcos, in his second SONA, encouraged Congress to amend the Cooperative Code, in order to strengthen their production output and market influence. He highlighted the need to address poverty and agricultural production issues, focusing on local agricultural production through consolidation, modernization, mechanization, and value chain improvement, wherein cooperatives can take a key role. The President also emphasized the need for a circular economy, using nature as a model to minimize waste and reduce the need for new resources. The KADIWA program, which connects farmers with consumers, is an example that has increased farmers’ income and reduced consumer expenses. More than 7,000 KADIWA outlets have opened in the country, benefiting 1.8 million families. An estimated ₱700 million in income was created, providing livelihood for around 3,000 members of cooperatives and other groups. In addition, among the 300 clusters of farm and fisheries and livestock raising farms, about 900 are cooperatives with more than 200,000 hectares of farmland.

We, at the DBM, fully support the endeavor of empowering cooperatives to live up to their role as an instrument of economic growth and social responsibility. That is why, from its almost ₱705 million allocation in the 2023 national budget, CDA was allocated around ₱1.3 billion, or an 85.05 percent increase, in the FY 2024 National Expenditure Program. 

This huge increase is attributed to the provision of vital support for the establishment of new and startup cooperatives, as well as to aid, strengthen and enhance the capability of micro and small cooperatives. It shall cover additional funding requirements for the construction/renovation of various CDA buildings and training centers, provision of ICT requirements, and support to CDA’s new locally-funded programs which includes ₱204 million allocated for the Capability Enhancement of Micro Agriculture Cooperatives through the Cooperative Development Project that will provide ₱1.2 million worth of assistance to each of the 170 micro cooperatives under the Agricultural Cooperative Cluster, to enable them to procure needed farm machinery and equipment. We have also allocated ₱128 million to the Micro and Small Consumer Marketing, Producers, and Logistics Cooperatives Start-up Capital Assistance to provide the 256 micro and small cooperatives under the program with ₱0.5 million per cooperative as start-up livelihood capital assistance to improve their socio-economic status.

Beyond budget, our support for cooperatives lies in ensuring that they continue to be on the leading edge of fostering sustainable and inclusive growth for all. They are a potent force in our bid for lasting progress, one that will not only take care of our people today but will leave a legacy that ensures prosperity for future generations, especially for the disadvantaged sectors of society. 

I subscribe to the adage that there is strength in numbers. Thus, I am one with the President in empowering cooperatives, encouraging small cooperatives, and strengthening the existing ones, to improve the lives of our kababayans.

(Amenah F. Pangandaman is the current Secretary of the Department of Budget and Management.)