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Sugarcane law not fully implemented due to budget cut

By Wilnard Bacelonia

August 30, 2022, 2:22 pm

<p><em>(File photo)</em></p>

(File photo)

MANILA – The Sugar Regulatory Administration (SRA) has not maximized the implementation of Republic Act (RA) 10659 or the Sugarcane Industry Development Act (SIDA) because of a slashed budget.

Former SRA chief Hermenegildo Serafica told the Senate Blue Ribbon Committee hearing on Tuesday that Congress kept on cutting the SIDA budget because of underspending.

From the mandated PHP2 billion budget, Serafica said SRA was given PHP712 million in 2021 and 2022.

For 2023, the Department of Budget and Management recommended PHP1 billion for the sugar industry regulator.

"They saw that we have been making progress with the utilization of the fund," Serafica said.

The hearing was the second one to tackle, among other issues, the controversial Sugar Order No. (SO) 4 that directed the importation of 300,000 metric tons of sugar, only to be taken back after Malacañang said it was unauthorized.

Serafica later resigned, confirmed by the Palace on August 16, and apologized for having approved Sugar Order No. 4 as it “has become clear that the same was not in keeping with your (President Ferdinand Marcos Jr.) administration’s desired direction for the sugar industry.”

He also said the socialized credit fund through the Land Bank of the Philippines was not implemented right away because there were concerns on the interest rates.

“It took a while to negotiate with the Landbank to bring it lower to a level that it will be beneficial to the small farmers," Serafica said.

He said an interest rate of 2 percent was eventually approved and the management fee was deducted from the common fund of the program.

Socialized credit is for the acquisition of production inputs, farm machineries, and implements necessary for the continuous production of sugarcane.

The loans shall be available to sugarcane farmers duly registered with the SRA, provided that the lender shall have a lien on the quedan (warehouse receipts) of farmers who obtained a crop loan until the loan is fully paid.

Farmers cannot be granted another loan until the loan is fully paid.

To ensure immediate payment of farmers and secure their income from sugarcane, farmers may enter into any payment method with the sugar mills or distilleries for their sugarcane.

RA 10659 was passed into law in 2015 to boost the production of sugarcane and sugar and increase the income of farmers, for which the law provides the allocation of PHP2 billion a year.

Of the annual fund, PHP1 billion should go to infrastructure for farm-to-mill roads; PHP300 million for credit; PHP100 million for scholarships; PHP300 million for block farms of the agrarian reform beneficiaries; and PHP300 million for shared facilities program. (PNA)

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