Coco levy fund should remain in a trust fund controlled by farmers but should be bigger through a P10- billion annual counterpart fund from the government, said Senate President Pro Tempore Ralph Recto.
Recto noted that the original proposal provides that the Coconut Industry Development Fund will only use the P2 billion to P2.5 billion interest income from the coco levy trust.
“But why will they use only the coco levy fund? Why can the government give a counterpart fund?” asked Recto.
Because of this, he said the Senate version added a guaranteed budgetary support of P10 billion to the PCA on top of the trust income.
He also said the original proposal was for a “perpetual” rehabilitation of an industry in crisis. The bill mandates a 25-year timeframe.
“If the patient is in ICU, then the treatment must be immediate, and the assistance massive,” he said.
He said the trust will be invested in the safest instrument there is, the Republic-backed government securities.
He also said the original proposal called for a creation of a 13-personal Trust Committee, separate from the PCA, plus a multi-agency ad hoc committee that will draft the “Coconut Industry Road Map.”
“Why create so many bureaucratic layers and overlaps, when it can be done by an expanded and strengthened PCA, dominated by farmers, who will occupy six out of the 11 seats?” also questioned Recto.
The proposed expanded PCA, he said, breaks tradition by reserving majority of seats for farmer. He said the PCA will be the lead initiator of the Coconut Industry Roadmap, in which all stakeholders will participate. It will be empowered with the right to ratify the stewardship or disposal of coco levy assets.
“Why maintain two bodies, when, for purposes of efficiency, transparency, accountability and savings, it can be done by one body—the PCA—that is dominated by coconut farmers?”
He assured that the coco levy will remain a trust fund, but not the typical hidden Off-Budget Account like the Malampaya and Road Users Tax Funds.
He said the fund will remain a trust account, but its usage, reporting, and expenditure will strictly follow budget, accounting, procurement and auditing rules.
The trust income to be spent pursuant to the industry roadmap will be determined by the PCA and line-itemized in its budget. It will not be considered new appropriations, which means that while it can be subject to scrutiny, it cannot be spent for other purposes.