Finance Secretary Carlos G. Dominguez III ordered the interagency Trust Fund Management Committee (TFMC) to guard against “double-dipping” of government resources in providing health and crop insurance coverage to 2.5 million coconut farmers.
Dominguez, who chairs the current TFMC, said the next batch of the interagency committee must ensure a “commercially viable” and “sustainable” health and crop insurance coverage for coconut farmers as provided under Republic Act (RA) 11524 or the Coconut Farmers and Industry Trust Fund (CFITF) Law. TFMC is tasked to oversee the use of the coco levy trust fund.
In the last TFMC meeting under the Duterte administration, Dominguez said a minimum of P200 million is allocated annually to the Philippine Crop Insurance Corp. (PCIC) for the crop insurance of coconut farmers under the CFITF law and the Coconut Farmers and Industry Development Plan approved by the President. Apart from this, another P500 million is allocated to Philippine Health Insurance Corp. (PhilHealth) to administer the health and medical program for coconut farmers and their families.
“As the Trust Fund Management Committee, we need to ensure that there is no double-dipping of funds, that the crop and health insurance coverage to the coconut farmers should only come from the coco levy trust fund,” said Dominguez during the meeting held last June 16.
Double-dipping is an unethical practice of filing two claims for one incident.
Budget Undersecretary Kim De Leon agreed with Dominguez and assured him that the budget department will be reviewing the budget proposals of PCIC, PhilHealth, and other government agencies receiving allocations from the CFITF “to ensure that no double dipping of funds would occur.”
To make the crop insurance coverage for coconut farmers sustainable, Dominguez recommended that premiums to be charged by PCIC should consider specific geographical and meteorological risks and include reinsurance mechanisms with the private sector “to reduce the financial burden on the coco levy trust fund.”
Dominguez, who served as agriculture secretary under the administration of former President Corazon Aquino, also expressed gratitude to the TFMC members for their “tremendous contribution to the final implementation and correction of the historical wrong that was done to the country’s coconut farmers.”
In the same meeting, the Bureau of the Treasury reported that TFMC received the from the Land Bank of the Philippines the Certificate of Indebtedness with a principal amount of P1,121,141,234.00 with a fixed interest rate of 1.75 percent per annum for the sale of state shares in the United Coconut Planters Bank (UCPB).
It also received P102,739,676.87 in cash proceeds for the sale of disputed UCPB shares and rights.
These shares were classified by the Presidential Commission on Good Government (PCGG) as Coco Levy Assets under RA 11524.
The proceeds from the disputed shares will be credited to a separate escrow account pursuant to the Implementing Rules and Regulations (IRR) of Section 9 to 11 of RA 11524, which states that a disputed Non-Cash Coco Levy Asset may be disposed of pending dispute, provided that the proceeds shall be deposited to and maintained in an escrow account.
The CFITF Law also provides that non-cash coco levy assets shall be privatized or disposed of and proceeds thereof shall augment the trust fund for the benefit of the coconut farmers.
According to the Department of Finance, the Presidential Commission on Good Government (PCGG) earlier reported that the value of coco levy assets amounted to P113.88 billion as of December 2020 but the Commission on Audit found out that this was overstated by P2.63 billion, with its adjusted tally amounting to P111.25 billion.
President-elect Ferdinand R. Marcos Jr., who had announced that he will be taking the helm of the Department of Agriculture (DA), will be chairing the board of the Philippine Coconut Authority, the government agency tasked to implement the coco trust fund law.
The coco levy fund came from the taxes imposed on coconut farmers during the term of the late dictator and former President Ferdinand Marcos Sr. which was supposedly for the development of the coconut industry.
However, the PCGG alleged that these funds were instead diverted to the establishment of corporations of Marcos’ cronies for their personal benefit.