President Rodrigo Duterte has vetoed the bill creating a P100-billion trust fund for the benefit of some 3.5 million coconut farmers.
Executive Secretary Salvador Medialdea confirmed the development on Friday, a week after the President also disapproved the bill seeking to strengthen the Philippine Coconut Authority (PCA).
The veto came even after Congress recalled the version of the coco levy fund bill first approved by bicameral conference committee last year to avoid Duterte's veto.
According to Senate Majority Leader Juan Miguel Zubiri then, Malacañang disagreed with the provision on the state-run Philippine Coconut Authority Board having six farmer representatives compared to five government representatives.
"Ayaw ng Malacañang na ang majority ng grupo na hahawak ng pondo ay sibilyan. Sabi nila the fund is entrusted to the government so they are treating it as a government fund," Zubiri said.
Both houses of Congress ratified the second bicam-approved version of the bill on November 22.
Senator Cynthia Villar, a proponent of the vetoed measure, had said the bill included provisions that would safeguard the approximately P100 billion of coconut levy funds, composed of cash and assets, and ensure increased income for all coconut farmers such as investing in Philippine government securities to assure returns and ensure the safety of the fund.
Duterte had also vetoed the bill supposed to strengthen the Philippine Coconute Authority.
In the letter addressed to the Senate dated February 8, Duterte said the bill "regrettably lacks vital safeguards to avoid the repetition of painful mistakes in the past."
Presidential spokesperson Salvador Panelo has said that the veto on the reconstituted PCA stemmed from Duterte’s concerns that some provisions are susceptible to corruption.
According to Panelo, the PCA should get approval on the use of its funds.
The Palace also took exception to the inclusion of the functions regarding sale, disposition, or dissolution of coco levy assets but "without checks and balances."
“Such condition will diminish the ability of the Department of Justice, through the Office of the Solicitor-General in coordination with the Presidential Commission on Good Government to act on cases relating to coco levy assets,” Panelo said.
Another reason was the bill called for a reconstituted 15-member PCA Board which includes seven members coming from the private sector.
Panelo said it would allow private persons to influence the disbursement of public funds.
“Finally, (because) the PCA is set up like the Road Board which is heavily criticized for allegations of corruption and misappropriation of funds,” he said.
The coconut levy fund came from taxes collected from coconut farmers during administration of the late dictator Ferdinand Marcos.
It was supposedly meant for projects that would benefit coconut farmers. Instead, it was used by the government to buy a large percentage of the United Coconut Planters Bank by Marcos’ crony and San Miguel Corporation chief Eduardo “Danding” Cojuangco Jr.
A 2014 Supreme Court ruling declared that the P71 billion worth of coconut levy funds used to purchase shares in San Miguel Corporation during the Marcos years belongs to the government and as such, should be used solely for the benefit of coconut farmers and for the development of the coconut industry. —NB, GMA News