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Enter the Department of Agriculture and Food

With the recent placement by President Duterte of the NFA (National Food Authority) under the supervision of the head of the DA (Department of Agriculture), food policymaking in this country has come full circle.

Food policy-making authority had been lodged with the DA since Independence Day. The government’s technical personnel were happy with that administrative arrangement—after all, agriculture embraced food—but certain politicians wanted to see an agency devoted to the food crops. Thus was NARIC (National Rice and Corn Administration) born. When NARIC became enmeshed in politics and corruption, the decision was made to try and sanitize the agency by renaming it NGA (National Grains Authority). Later the agency underwent another change of name; NGA gave way to NFA, to emphasize the fact that it was food that was under consideration. With President Duterte’s Executive Order, food policymaking authority has been returned to DA, where it all began.

The professed concern of the proponents of a separate agency for food was the prioritization of food in the government’s policy hierarchy. It was argued that, with an agency of its own, food would enjoy priority at the hands of the dispensers of fiscal and other benefits. Separated and distinct, a food agency would not suffer the inattention and parsimony habitually accorded to DA by the Executive Department and Congress.

NFA’s champions were correct in their calculations. The food agency did come to enjoy the fiscal policymakers’ favor and preferential attention. Indeed, one measure of the policymakers’ complaisant attitude toward NFA were the huge explosion of NFA’s debt. One of the three largest items in the government’s domestic-debt service is the debt of NFA.

Nowhere in the law creating NFA is there a provision allowing NFA to engage in losing operations. Yet year after year NFA piles up operational losses, to the point where the agency’s name has become virtually synonymous with losses. That’s because NFA’s management has acquired the mindset that NFA is required to provide Filipinos with cheap rice at all cost.

Cheap rice, yes; NFA is mandated by law to provide cheap rice, but it is not required to do so at a loss. Cheap rice. Unfortunately, rice, being the staple food of the low-income groups, is a political commodity and lends itself to the overwhelming influence of partisan politics.

If the truth must be told, NFA has never really been interested in keeping Filipinos supplied with low-priced but domestically produced rice. With its enormous budget, NFA could well operate in a manner that was supportive of Filipino farmers. Given the levels of the farmgate prices that NFA pays them for their output—that’s around P17 per kilogram at present—there is little incentive for Filipino farmers to be more efficient. The resulting low per-hectare yield gives rise to inadequate domestic production, which, when sold to NFA, becomes known as NFA rice. Naturally, the supply of low-priced NFA rice is soon exhausted.

Enter imports. Paraphrasing the Department of Tourism slogan, “There’s more fun in imports.” Imports yield under-the-table commissions, even when done on a government-to-government basis; purchases from domestic farmers don’t give rise to commissions. That’s why NFA management is trigger-happy whenever the possibility of supply deficits arises.

This country has the resource endowment with which to achieve self-sufficiency in rice, but as long as NFA is structured the way it is and as long as the present NFA management is oriented, like its predecessors, toward imports, that desideratum will be elusive.

Over the years NFA has been associated with supply deficits, imports operating losses, heavy indebtedness, inefficiency and corruption. Clearly, the experiment with an agency charged with delivering national food security has failed. Time to bring food policymaking back into the fold of the DA.

The name Department of Agriculture and Food would, in the light of the latest structural change, be entirely appropriate.

Topics: Rodrigo Duterte , National Food Authority , Department of Agriculture , Congress
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