Group seeks release of P1.4B in farm credit fund

The Federation of Free Farmers (FFF) urged the Department of Budget and Management (DBM) on Friday to immediately release the remaining funds under the Agricultural Competitiveness Enhancement Fund (ACEF) to address the urgent need of farmers for credit given the adverse effects of the COVID-19 pandemic.

The ACEF, put up in 1996, was created as a safety net for farmers and fisherfolk affected by trade liberalization policies of the government.

It is funded with duties collected from the importation of agricultural products under the minimum access volume as committed by the Philippines to the World Trade Organization.

DBM records showed that the ACEF had a fund balance of P5.15 billion as of May 2018, of which the allocation for credit amounted to P4.12 billion.

The agency released P1.28 billion for Land Bank of the Philippines’ credit program in 2018 and remitted the second tranche of P1.44 billion in early 2020, leaving a balance of P1.4 billion.

Despite repeated requests by stakeholders, however, the agency has yet to release the remaining funds.

FFF said the available balance could even be higher since additional tariff collections since May 2018 has not yet been taken into account.

“While we understand that DBM should release the ACEF in tranches based on actual demand and usage, it should not withhold funds when the releases have already been exhausted and there are still pending loan proposals,” FFF national manager Raul Montemayor said.

He added that there should not be any delay in the disbursement of ACEF funds in the first place because the funds have been in DBM’s Special Account since 2018.

Montemayor also cited a key provision in the ACEF Extension Law stating that “fund releases shall not be subject to any ceiling by the DBM.”

“Unlike annual budgets that need to go through a rigorous appropriation process, these ACEF funds are already earmarked by law for DA’s support programs. DA should exert more effort in getting hold of these funds,” he added.

The use of the ACEF has been marred by controversies. In 2011, its implementation was suspended after an audit showed that it missed its target beneficiaries, which are the poor farmers and fisherfolk. Low repayments also led the facility to near-bankruptcy.