The Philippine Center for Postharvest Development and Mechanization (PHilMech) has suspended payment for 1,364 units of agricultural equipment worth P1.7 billion due to some technicalities in the procurement process.
Meanwhile, a congressional leader has recommended that the Philippine Coconut Authority (Philcoa) and the Department of Agriculture (DA) designate a project preparation office to help implementing national government agencies, local governments, and other proponents formulate viable project proposals to access the P75 billion Coconut Industry Development Trust Fund, created under Republic Act 11524.
According to PHilMech director Dr. Dionisio Alvindia, the Department Budget and Management (DBM) approved the procurement of 1,800 units of four-wheel tractors valued at P2.116 billion under the Rice Competitiveness Enhancement Fund (RCEF)-Mechanization Program.
However, former PHilMech executive director Baldwin Jallorina allegedly decided to buy only 1,364 tractors worth P1,770,930,870 contrary to the 1,800 units based on the approved Authority to Purchase Motor Vehicle (APMV) issued by the DBM on May 20, 2021.
The decrease in the number of purchased tractors was purportedly due to the adjustments of the original contract price, from P1.2 to P1.3 million for each unit, but without the approval of the DBM, Alvindia said in a statement.
“As a consequence, Jallorina was relieved by then President Rodrigo Duterte on the recommendation of Agriculture Secretary William Dar last year,’ he said.
Based on documents provided by PHilMech, a letter issued by Cristina Clarassa addressed to Dar, stated that adjustments on the price of tractors were made on the recommendation of the Bureau of Agriculture and Fisheries Engineering for the inclusion of hydraulic ports.
“The Adjustment resulted in the increase of the approved budget contract (ABC) from P1.2 million to P1.3 million, a P100,000-increase for the initial approved value,” Alvindia stated.
But Alvindia asserted that despite the absence of an amendment to the APMV already approved by Dar, the transaction entered into by the former PHilMech head to buy tractors at a higher price pushed through.
The PHilMech and the DA are conducting separate probes into the matter, saying it will file administrative cases against other PhilMech personnel involved in the questionable purchase of the tractors.
The suppliers of the tractors who were reportedly demanding payment for the purchased 1,364 units of agricultural tractors amounting to more than P1.7 billion were advised to file a petition for money claim with the Commission on Audit (COA).
In another development, Albay Rep. Joey Sarte Salceda, chair of the House ways and means committee, said; “The way the fund is structured is that the Department of Budget and Management only releases funds to implementing agencies when there are already workable proposals for their use. So, it’s heavily dependent on the quality of proposals. It’s like a grant in that sense,”
To expedite the use of Coco Levy Trust Fund, Salceda said he would strongly suggest to President Marcos that the DA and the Philcoa designate some office thatwould serve as the project development unit to help agencies and farmers formulate proposals for funding of their projects.”
“The office would also help ensure that the proposals are viable, sustainable, and effective in their objectives of truly uplifting the lives of coconut farmers,” Salceda said.
As of July, the DBM has released only P755 million of the P75 billion fund, P5 billion of which was mandated to be spent annually.
“We have a very low utilization rate for the Coco Levy Trust Funds because good proposals simply do not exist. Certainly, there is a gap in capacities of implementing agencies. That gap is obviously in project development. So, why don’t we help agencies, LGUs, and farmers create proposals that can be funded? That way, we expedite the release of funds, and frontload benefits to coconut farmers. They’ve waited for this for decades.”
Salceda also proposed a centralized portal containing all requirements, standards, and useful information on accessing the Trust Fund.
“The process can be quite complex and difficult to access or understand. I had to be briefed by the Treasurer of the Philippines herself on the use and allocation of such funds before I fully understood how it was supposed to work. Understandably, disbursement has been slow as a result,” Salceda said.
“I think we can certainly do better on this front. LGUs and farmer groups can partner with implementing agencies, for example, in proposing projects and accessing funds. Perhaps the DA can generate templates and best practices for fundable projects. But we need to be able to benefit from the trust fund soon, because coconut is and will always remain a key agricultural sector,” he added.
Salceda said “there is momentum in the coconut sector, with our coconut product exports reaching almost USD 2 billion in 2021,”
“We produce the most coconuts per land area among all the world’s major producers. This is one of our comparative advantages in agriculture. We need to get this sector right – and if we do, the rewards for our farmers and our economy as a whole are significant,” Salceda said.
“This is unlike rice or sugar where we need massive investments to be a global leader in production. For coconut products, we are already the world’s best. We just need to sustain investments in the sector, and the money already exists. It would be an unforgivable sin of omission if we lose out on this sector, when we have the funds, the interest, the market, and the know-how to expand our advantages,” he added.