Despite P16-B loss, NFA won't be dissolved- Finance

Despite being the biggest financial bleeder in the government, the National Food Authority will not be dissolved, the Department of Finance said on Monday. However, Congress needs to come up with policies that will stopper the losses made by NFA, which reached P16 billion in 2006. In 2005, NFA cost the government P10 billion. "NFA has to exist, it's not viable for it not to. It's unrealistic to do away with it but even if that is a given, we still need to work on policy," Finance undersecretary Jeremias Pol said. Pol heads the Finance department's Corporate Affairs Group. At the cabinet level of the Development Budget Coordination Committee (DBCC), Pol said there was an on-going policy review to settle the question of food security. "Right now, it is being discussed whether food security is equivalent to rice self-sufficiency. The future direction of the NFA would emanate from that policy decision," he said. Pol said it would be up to the DBCC and ultimately, Congress, to determine whether the NFA should be split into two different agencies to separate its regulatory and marketing functions. This meant however, that the policy of subsidizing the fluctuations in domestic palay and rice prices would stay, implying continued losses for the government since it would have to increase this budget in order for the subsidy to work. In the meantime, Pol said there were immediate steps that needed to be taken to improve the operation efficiency and transparency of the NFA, with the end-view of reducing its impact on the push for a balanced budget by 2008. Pol said the Australian-funded study came up with a long list of steps that could be taken which were now being evaluated by an inter-agency technical group. "One major issue is that, admittedly, there are a lot of factors that are beyond the control of the NFA, such as the world market prices of rice and the market forces themselves that are at work in this very small international market. We need to separate which are immediate and which are long term," he said. - GMANews.TV