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By Efren L. Danao Senior
Reporter
Sen. Edgardo Angara is concerned
over the “extremely negative” financial position of the National
Food Authority (NFA) and warned that it is “following the
footsteps of the National Power Corp. as the next financial fiasco
to hit the government.”
Angara, a former agriculture
secretary, cited a review of the NFA’s operations showing its
accumulated losses in 2007 could reach P48 billion, and its
outstanding loans, P69 billion.
“If NFA continues to operate as
is, it is projected that in the year 2010 its accumulated losses
will hit P111 billion, and its outstanding loans will reach P136
billion,” he said.
The agency is not designed to
make money as it subsidizes the price of palay bought from farmers.
It also imports grains when production is low to maintain its 90-day
buffer stock. In 2006, NFA imported 1.622-million metric tons mainly
from Vietnam, Thailand and the United States.
Angara, however, believes that
the “extremely negative” financial position of the NFA and other
government-owned and controlled corporations is partially due to the
“imprudence” in debt management. He said Presidential Decree
1177 or the Budget Reform Decree of 1977 encouraged this
“imprudence” by automatically backing all debts of
government-owned and controlled corporations (GOCC) with government
guarantee.
He noted that as of the first
quarter of 2007, the government had already guaranteed
P418.364-billion worth of debt of government firms.
“This could be a huge financial
burden for the government if these corporations don’t straighten
up their act,” Angara said.
He has filed a bill seeking to
end the government’s automatic guarantee of the debts to make them
more responsible for their debts. His bill also requires the
inclusion of the government firms’ budgets in the annual budget of
the national government submitted by the President to Congress.
“The annual budget should
include the proposed corporate operating budgets of GOCCs, their
subsidiaries and affiliated companies, which require national
government budgetary support,” Angara said.
At present, Congress has no say
on the budgets of the government corporations although the servicing
of their debts is included in the general appropriations bill.
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