Measure bats for higher crop insurance


Drastic shifts in weather patterns call for shifts in policy to allow the populace to weather impact of climate change.

In this light, Rep. Anthony Bravo of Coop Natcco party-list proposed “better allocation of government financial resources in the agriculture sector,” while Rep. Delph Gan Lee of Agri-Agra Reporma Para sa Magsasakang Pilipinas (AGRI) party-list sought an end to the “wasteful and price-distorting expenditure in government rice importation through the National Food Authority [NFA].”

Bravo seeks higher property insurance for crops “to require a payment between the range of 80 percent to a hundred percent of the actual value of farmers’ projected harvest” and a corresponding government premium subsidy of no less than 50 percent for staple grains, rice and corn.

The Bravo measure seeks to amend the Revised Charter of the Philippine Crop Insurance Corp. (PCIC) Act of 1995.

“The problem with the PCIC is that it has continually failed to adequately protect our sub-sistence farmers from the rigors of calamities, often paying far less than what the actual value of the projected harvest is,” explained the lawmaker.

“It is only by properly com-pensating the farmers will we fully protect their interest and those of their families. This is very much needed at present and in the years to come considering the devastation brought about by climate change which has led to stronger typhoons and more unpredictable weather patterns.”

Wiser government spending in the agriculture is the intent of the Gan Lee proposal—House Bill (HB) 2936 or “National Food Authority Rationalization Act of 2013,” seeking to end NFA monopoly on rice importation by limiting its functions to buffer stocking and price regulation.

“This will allow for scarce government resources to be re-allocated away from costly price stabilization functions to more productive investment in rice research and development, extension services and irrigation,” explained Gan Lee.

The bills came in the wake of the damage caused by Typhoon Santi to the agriculture sector initially estimated at P3 billion across 248,000 hectares of rice land.

Bravo, is also the author of the bill amending the Agricultural Competitiveness Enhancement Fund (ACEF), allocating 10 percent of its proceeds to the PCIC.

Under the law, proceeds from the tariffs collected on imported agricultural products like rice go to the ACEF. These are set aside for irrigation, farm-to-market roads, post-harvest equipment and facilities, credit, research and development, other marketing infrastructure, provision of market information, retraining, extension services, and other forms of assistance and support to the agricultural sector.

In 2013, however, rice im-portation through the private sector was reduced to three percent from the previous year’s 76 percent, just as the De-partment of Agriculture (DA), through the NFA, nearly doubled its imports from 120,000 metric tons (MT) in 2012 to 205,700 MT in 2013.

The NFA paid around P1.7 billion in duties and taxes for the importation of rice in the same year, under a government-to-government deal. This is on top of the $94.5 million or more than P4 billion spent by the agency to import 205,700 MT of rice from Vietnam in April of 2013 alone.

The said transaction is currently under investigation by the Senate and the House of Representatives for alleged overpricing to the tune of nearly half-a-billion pesos.

Despite having invested heavily in government importation this year, rice prices in September soared to an all-time high according to the Bureau of Agricultural Statistics—to P36.04 per kilogram, increasing 23 percent from P29.38 at the height of the rice crisis in 2008.

Stripping the DA and NFA of importation functions is in consonance with the recommenda-tions of both the Food Staples Self-sufficiency Program and the National Economic Develop-ment Authority.


Please follow our commenting guidelines.

Comments are closed.