President Rodrigo Duterte has signed into law a bill creating a trust fund for the country’s coconut farmers.
Duterte signed on February 26 Republic Act 11524 or the Coconut Farmer and Industry Act, which mandates the maintenance of the Trust Fund for 50 years under the Coconut Farmers in Industry Development Plan that will be formulated.
Under the law, the Coconut Farmers and Industry Development Plan will be crafted by the Philippine Coconut Authority (PCA) and approved by the President.
“It is hereby declared the policy of the State to consolidate the benefits due to coconut farmers, especially the poor and marginalized, under various statutes and to expedite the delivery thereof to attain increased incomes for coconut farmers, alleviate poverty, and achieve social equality,” the new law read.
The new law also reconstitutes and strengthens the PCA, an independent state corporation created under Presidential Decree 1468, to ensure the participation of coconut farmers in the crafting and implementation of the Coconut Farmers and Industry Development Plan.
Under Republic Act 11524, the government will dispose of P75-billion worth of coco levy assets in the next five years to establish a trust fund for the benefit of the coconut farmers and development of the industry. The new law, also known as the “Coconut Farmers and Industry Trust Fund Act,” is expected to benefit coconut farmers who own not more than five hectares of coconut farm.
The coconut levy funds refer to the funds generated from the taxes imposed on coconut products and collected from coconut farmers, millers, refiners, exporters, and other end-users decades ago.
The new law mandates the Bureau of Treasury to transfer P10 billion to the trust fund in the first year, P10 billion in the second year, P15 billion in the third year, P15 billion in the fourth year and P25 billion in the fifth year.
“All Coconut Levy Assets in the name of the Philippine Government shall be sold within the period of five years after the effectivity of this Act,” the law read.
“All other coconut levy assets that may hereafter be recovered shall likewise be disposed of within five years from the time it is declared as belonging to the government, and the proceeds shall be transferred to the Trust Fund for the benefit of the coconut farmers,” it added.
RA 11524 states that the Trust Fund is separate from the regular funds appropriated to the PCA through the annual General Appropriations Act.
“As such, the PCA shall continue to pursue its mandate of implementing programs and projects from the regular GAA appropriations and from funds under the Trust Fund,” the law read.
The law also creates a Trust Fund Management Committee composed of authorized representatives of the finance, budget, and justice departments.
The committee is tasked to set investment priorities, investment themes, asset allocation, and policies; evaluate assets; issue guidelines for portfolio turnover and trust fund management expenses; set annual allocation of the Trust Fund; and approve financial requirements.