Sugar funding to follow the law, but reform needed to curb underspending — Villar
SENATOR Cynthia A. Villar said the funds set aside for sugar industry development have been poorly utilized, but added she still backs a budget of P2 billion for 2020.
“Ang maipu-push lang namin sa budget hearing ibigay iyong P2 billion because that is the law (The law requires us to fund sugar development for P2 billion),” she said, referring to the Sugar Industry Development Act (SIDA).
“Ngayon, ayaw nilang ibigay because of underspending. So ngayong budget hearing, ire-request namin na magre-reform na sila, bigyan mo na sila ng mas malaki (Some officials don’t want to provide the funds because of underspending. So at the budget hearing we will press for reforms before we authorize larger amounts),” she told reporters after a hearing to look into the utilization of SIDA funds.
Ms. Villar chairs the Senate committee on agriculture and food.
SIDA, or Republic Act 10659, came into effect in 2015 to upgrade the industry’s competitiveness, and maximize the utilization of sugarcane resources, and boost the income of farmers and farm workers through improved productivity, product diversification, more jobs, and sugar mill efficiency.
The Sugar Regulatory Administration must use P300 million in SIDA funding for credit; P300 million for the Philippine International Trading Corp. (PITC); P100 million for scholarships; P300 million for block farming; and P1 billion for infrastructure development.
Underspending in 2016 led the Department of Budget and Management (DBM) to reduce the allocation to P1.5 billion in 2017, and further to P500 million in 2018 and 2019.
For 2020, there are proposals to further reduce the funding to P67 million.
During the hearing, SRA Administrator Hermenegildo R. Serafica said underspending mainly came from undisbursed loans from Land Bank of the Philippines (LANDBANK), and procurement money set aside for the PITC.
“Kasi nga daw binigay nila sa LANDBANK, hindi napautang. Binigay nila sa PITC para bilhin ang equipment, hindi nabili ng PITC… Parang nagkamali sila ng pinagbigyan na agency,” Ms. Villar said. (They gave the funds to LANDBANK, which did not lend. They funded PITC to buy equipment, but the PITC was not able to do so… it seems like they gave the money to the wrong agencies.)
Mr. Serafica noted that for 2016, P914 million went to infrastructure, P85 million to block farms, P48 million to socialized credit, and P90 million to scholarships.
The SRA also noted that the loan application process is difficult for farmers, leading them to tap usurers.
Ms. Villar recommended that LANDBANK simplify its loan requirements for small farmers, and that the SRA allocate the P300 million for PITC to the Department of Science and Technology (DoST) to develop equipment to help modernize the sugar industry. — Vincent Mariel P. Galang