Villar: DA should keep hands off ACEF meant for loans, scholarships

Senator Cynthia Villar on Tuesday said the Department of Agriculture should no longer be disbursed with the Agricultural Competitiveness Enhancement Fund (ACEF) due to the multi-billion "bad loans" it allegedly incurred when it previously handled the fund.

ACEF is generated through duties collected from the importation of all agricultural product, except rice, under the minimum access volume, Villar said in a Senate hearing, noting that this is different from the  Rice Competitiveness Enhancement Fund.

"The 80% of the (ACEF) fund will be used to support the increased productivity and fisherfolk by providing necessary credit to them and their cooperatives," Villar, chair of the Senate Committee on Agriculture, Food and Agrarian Reform, said.

The maximum amount of loan that can be lent to an individual farmer through the ACEF is P1 million while a cooperative may borrow up to P5 million.

Another 10% of the ACEF is allocated for research and development on agricultural and fishery products of state universities and colleges (SUCs); the remaining 10% is for scholarship grants for agriculture, forestry, fishery, and veterinary medicine education.

The Land Bank of the Philippines (LBP), SUCs, and the Commission on Higher Education are the only implementing agencies, Villar said.

This is why she wondered why P4.16 billion under the new ACEF from June 2018 to June 2020 still passed through the DA before being remitted to the LBP, as reported by LBP First Vice President Emelie Tamayo.

"Under the new ACEF it will not pass through DA. It will go direct to you from Bureau of Treasury. Wala nang dadaan sa DA kasi 'pag dumadaan sa DA lalong gumugulo. I don't understand why it is being transferred by DA," Villar said. 

"I wrote the law. Why is it coming from DA?" she added.

'Mismanaged loans'

Villar said the DA was not able to manage the old ACEF well and that there were apparent irregularities in the past.

"'Yung unang implementation of ACEF didn't go to the small farmers and their coop. Noong reviewhin namin it went to big companies and the minimum that they lent was P15 million and the biggest was P100 million," she said. "P8 billion we lost to the old ACEF because the borrowers did not pay... kasi sinabi talaga ng mga borrower, kaya ayaw nilang magbayad, naglagay sila."

"'Yung scholarship kaya hindi mabayaran, dumaan sa DA. Ayaw ibigay ng DA sa CHED," she added.

The Department of Budget and Management said it was disbursing the ACEF to the DA because these were "collections pertaining to prior years."

"As far as we are concerned, the process has to be like this," DBM chief budget and management specialist Loida Wy said.

"No, no, no. I wrote the law and all the problems that came with ACEF [was] because it was given to DA. When we re-enacted the law, inalis namin sa DA. Dinala namin sa Land Bank... Walang dadaan sa DA because DA lost the money," Villar answered.

"You change that. You tell [Budget Secretary] Wendel Avisado to change that because that is the intent of the law, that it should go direct to Land Bank, it should not pass through DA," she added.

Villar said she already referred the issue on bad loans in the old ACEF to the Office of the Solicitor General and said her goal is to prevent similar dilemmas from happening by ensuring that ACEF is properly disbursed to the implementing agencies.

"That's why we're having this hearing. Hanggang ngayon sumusulat pa 'yung mga bata na hanggang ngayon 'di nababayaran ang tuition nila. My God! Sobra naman 'yan," Villar said.

"Can we ask a commitment from DA na huwag na nila pakikialaman ang ACEF?" she asked.

Agriculture Undersecretary Evelyn Laviña, representing the DA in the hearing, did not discuss the alleged previous irregularities with the old ACEF but answered Villar's question in the affirmative.

"That's what we really wanted. Yes po," Laviña said.

The Bureau of Treasury and the DBM also committed to make the necessary coordination to rectify the disbursement process.

According to Villar, ACEF was first instituted through the Agricultural Tariffication Act in 1996. Its implementation has been extended twice in 2008 and 2016. ACEF will expire in 2022 unless it is extended once again. —KG, GMA News