NFA Council vows to weed out corruption

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IN line with the Duterte administration’s transparency initiative, the interagency National Food Authority (NFA) Council on Tuesday said the public can expect radical changes in this year’s government rice importation program as it vowed to weed out corruption within the state-run grains agency.

Cabinet Secretary Leoncio Evasco, who is also the chairman of the NFA Council, said that they have decided to scrap procurement systems that are no longer working for the best interest of consumers, particularly the poor.

“This policy shift is consistent with President Digong’s [Rodrigo Duterte] call for change. The council believes that we have to be aggressive in our actions when trying to obtain our nationalistic goals such as food security,” Evasco said in a statement.

Evasco, in an apparent swipe at NFA Administrator Jason Aquino, reiterated that it is the NFA Council that sets policy guidelines via board resolution, reflecting its collective decision, and not of the individual members.


“Hence no one, among the individual members, or that of NFA management, is authorized to individually represent or negotiate certain terms of contracts and other concessions on behalf of the
Philippine Government and that of the NFA,” he said.

Evasco said the policy shift has received overwhelming support from the National Food Security Committee (NFSC).

To achieve this, the official said the NFA Council has decided to shift from the traditional government-to-government (G2G) scheme to an open tender or a government to private scheme (G2P).

“While it recognizes that there is an immediate need to augment NFA’s buffer stock by activating
the 250,000 metric tons standby authority, the council deems that a G2P is more transparent since its bidding process is guided by the Government Procurement Reform Act,” Evasco said.

The Cabinet official noted that previous G2G schemes were exempted from the Procurement Law, hence the NFA was free to make its own guidelines and implement the same.

“Such acts that are all below the radar of government rules and procedures. Thus, in effect the G2G scheme is tantamount to ‘self-regulation’ which, as we all know, does not work well when an agency is required to perform both regulatory and proprietary functions such as the NFA,” he said.

Evasco said combining these both functions makes the entire process prone to conflict of interest.

Also, as per recommendation of the NFSC and Imports Committee, the 250,000 MT import authority will be divided into several tranches of arrival and a cap placed on each lot, to ensure competition and fair trade.

“The council is looking at dividing the importation to 8-10 lots with minimum of 25,000 MT and maximum of 50,000 MT per lot.

This year’s government to private importation seeks to do away with the old G2G that lacks transparency and competition,” he said.

Delivery period of the G2P importation shall be from July 31 until last week of September.

The council has also agreed to remove Subic Freeport Zone as port of entry for G2P and include Zamboanga City as port of entry.

In order to lessen the cost of goods, the terms of payment, which previously lasted for 365 days, has been decreased to 15 days since only big time players can afford to wait for 365 days.

Also, the members of the Bids and Awards Committee shall be selected and approved by the council. Members of the council, such as the Development Bank of the Philippines and farmer representative, will also be designated as observers in the BAC meetings.

For the Minimum Access Volume (MAV) program, Evasco said the council has agreed to limit the functions of the NFA Administrator to ministerial, and allowed the Office of the Cabinet Secretary to sign in his absence.

To recall, administrative delays in the previous MAV has caused legitimate importers huge losses for paying demurrage while waiting indefinitely for the NFA administrator to sign import permits with complete documents.

Under the new scheme, the NFA administrator shall immediately sign and release the import permits, within one day upon endorsement of NFA’s Grains Marketing Operations Division of traders’ completed documents as prerequisite for the signing of respective import permits.

The NFA Council wants the delivery period of private sector-led importation to arrive in tranches – at least 30 percent of the volume of import quotas should arrive between August and September, and the balance to arrive between December and February 28.

“Our Domestic Rice Index Situation as of June 07, 2017 shows that household and commercial stocks are in comfortable status with household stocks at 44 days and with commercial stocks at 28 days,” he said.

“Wherefore, with the opening of this year’s MAV, the commercial stocks will further be augmented, and in order to avoid oversupply and in anticipation of the harvest season, the council has decided to let private sector importation arrive in tranches,” he added.

 

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