NFA buying price procurement

Republic of tlre Philippines HOUST OF REPRTSEI{TATTYES Quezon Ci!5r SEI'ENTETI{TII CONGRESS Third Regular Session

IIOUSE JOINT RF,SOLITTIOIT NO.

0orx 2B

INTRODUCED BY REPRESENTATIVES /IRIEL B, CASILAO, CARLOS ISAGANI T. ZARA'TE, EMMI A. DE JE.SUS, ANTONIO L. TIIYIO, ARI,TI|D D. BROSAS, FRANCI L. CASTRO, AND SARAII JANE I. EL/IGO

A JOIIST R.ESOLUTION PROVTDnTG FOR A SI'PPLETilTNTAT, BIIDGET OF TEN BILLION PESOS {plo B) TO BE IMMDDIATELY RTLEASED TOTHE NATIOI{IIL FIOOD AUTHORfIYAND DIRTCTIITG THD I|AIIOITAL F'OOD AUTHORI1YTO EXCLUSwDLY USE THD AI}TOT'ITTT() I'RGEITTLY PR(rcURE FOR THE PTRIOD SEPTEMBER 2018 TO .rArRtARy 2019 AT LEAST s(X),O(X) METRTC TONS OF pALAy I.ROM krcAr, RICT F,IIRITIERS AT TIIE FARM GATE PRICE OF TWTN'TY PESOS (P2O} PER XILOGR"AM IIY ORI}ER, TO EA.sT TIIE RICE CRISIS TIIAT IS I}EVASTATING THE POOR OF THIS COI'NTRY WIIEREAS,

for eight straight months now, the country has been suffering from a rice crisis that is getting worse every day and does not have an end in sight because of inaction of concerned authorities. It started in the last week of Januar5r this year when, on the impetus of implementation of TRAIN 1, prices of commercial rice increased from P38 to 39.5O-P4O per kilo. Since then, rice prices increased steadily until it breached the P5O/kilo mark in July; WIIEREAS, in February, tJre consuming public started calling for price control but the government refused to act on these calls since it is against neoliberal p'fecepts; WIIEREAS, in May, the NFA tried to address soaring rice price increases by importing 5OO,00O metric tons of rice from Vietnann and Thailand. But the did not have any e{fect on the prices since the NFA controlled its stock releases by prioritizing distribution to provinces and areas experiencing the most irnportation

severe shoftage. It also started restricting its sale to household consumers at 3 kilos

per purchase per person which only reinforces the mass psychologr about the existence of a rice crisis which in tum feeds the psychological climate for price spikes; WIIDREAS, in August, despite or maybe because of the stopgap measures, the situation spiraled into critical dimensions when people started lining up at NFA bulng stations as rice prices have soared higher beyond the reach of ordinar5r incorne-earners.

In sorne places such as in Zamboanga, Sulu and Tawi-tawi, the increases have reached stupendous heights. There, retailers are selling rice at a record-setting price of P100/kilo; WHEREAS, more than distribution problems, the NFA has weakened its capability to address tJ:e supply situation. It is relying on importation which is counter-productive in as much as importation is destructive of the local rice industry,

its loca-l source of palay. In 2OL7, wLth its reliance on importation, it only procured 2a344 metric tons of palay out of a target of 153,483 metric tons, as the agency, without expressed approval from the NFA Council, undermining

applied its entire P5.1 billion allocation 1n the 2Ol7 GAA for Food Security Program to payment of its maturing loans with the LBP and DBP and guarantee fees advanced by the Bureau of Treasury; WIIEREAS, this year, it did the same thing. It again used P6.1 billion of its P7 billion allocated in the 2O18 GAA for Buffer Stocking Program to payment for its maturing loans. With its procurement fund spent on ulauthoriz,ed loan payments, it procured a rniserly 334 rnetric tons as of Januar5r 2Ol8; WHEREAS, these acts of the NFA are highly irregular. They not only flouted the legislative intent in allocating funds for the NFA but, on a most significant sense, they also led to a procurement failure that contributed immensely to the worsening spiral of the rice crisis; WHEREAS, in the hearing on September O3, 2018 conducted by the Committee on Appropriations, NFA Administrator Jason Aquino justifred his acts by saying that he decided to apply the agenry's procurement funds to loan paSrments because rice farmers are not selling their rice produce to the NFA. He claimed that, at Pl7 /ktlo, the current NFA farm gate price is not competitive since traders are b*uying palay from rice farmers at P18 to 2O per kilo; WIIEREAS, in and out of the NFA Council and the ha-lls of the legislaturc, there is a growing mass clamor for increasing the NFA farrn gate pr.ice so the NFA can effectively carrJr out its local procurement function ald do its part in ad&essing the rice crisis. The farmers' sectora.l representative in the NFA Council testified that

as early as four years ago, he had proposed to the Council the increase of NFA farm gate price to attract larmers into selling their palay to the NFA. This proposal is supported by the present NFA head. As early as February 2018, the Bantay Bigas, an alliance of rice fa,rmers, consumers and retailers, has also arliculated in various fora the proposal for the NFA to increase its procurement price at the farm gate as one of the more ellective means of addressing ttre severe supply shortage in the dornestic mai'kâ‚Źt: WIIEREAS,

has sat on the proposal amounting to disapproving it, claiming it needs further study as an exercise of caution against inflation. In truth, the economic managers who dominate the Council are waiting for the enactment of rice tariffication bill and the arrival of the next 500,000 metric tons the NFA Council

of imported rice which they hope would do t}le trick of lowering rice prices; WIIEREAS, because of NFA Council inaction on the proposed farm gate price increase and the NFA's reliance on importation, the government has been reduced into a paral5rtic in addressing the rice crisis. Except for plugging supply holes here and there, it has done nothing to effectively address the situation which is getting worse each day as the rice prices continue soaring and the lines at the NFA retail stations get longer; WHEREAS, there is a need for Congress to snap the government out of its paralysis and inaction in order to avert the crisis from getting out of control and from firrther devastating the Filipino people, rnost espeeially the poor; WIIEREAS, given that the NFA had only procured 334 metric tons tJris year and had used up almost entirely its P7 billion procurement budget for 2Ol8 to loan payments, there is a need to provide the agency a supplementa-l budget so it can resume procuring palay from local production in order to frll up tl:e shortage of NFA rice: WIIEREAS, the country is entering the harvest season of the lean second cropping. The NFA must be refueled with adequate funds so it can procure a substantia-l portion from the coming harvest; WHEREAS, the supplemerrtal

budget shal1 be provided the NFA without exonerating its ollicials of their unauthorized diversion of procurement funds. It shall be exclusively used for procuring palay from local rice farmers for the period Septernber 2Ol8 to Januery 2O!9 at an enhanced price of P2o/kitrograrn;

WHEREAS, the remaining P9OO,000.00 from the P7 billion which the 2018 GAA had allocated to the agency for palay procurement shall be added to the supplemental budget subject to ttre same instructions and conditions; NOW, THEREFORE, BE IT REISOLVED, that Congress pass this resolution providing for a supplemental budget of ten billion pesos (PlO B) to be immediately released to t.l e National Food Authorit5r and directing the NFA to use it exclusively for urgently procuring for the period September 2O18 to January 2O19 at least 5OO,0OOmetric tons of palay from local rice farmers at tlle farm gate price of twenty pesos (P2O)per kilogram.

Adopted.

I

t,t t

-, RTP. ARIEL

B. CASILAO

ANAKPAWISParty-list

REP. EMMI A. DT JESUS GABRIELA Women's PartJr

: ANTOITIO L. TINIO

ACT Teachers Partv-list

.CASTRO Party{ist

D. BROSAS Women's PartJr