How Hacienda Luisita Stock Scheme Led to Farmers’ Misery

In September 1995, the Sangguniang Bayan ng Tarlac reclassified 3,290 agricultural hectares of Luisita for commercial, industrial and residential use: the Luisita Golf and Country Club, Las Haciendas Industrial Subdivision, Family Park Homes Subdivision, Don Pepe Cojuangco Subdivision and the St. Luis Subdivision. Of this, 500 hectares have been sold to two Japanese corporations namely Itutsu and Hasana. Another 500 hectares were converted into the Luisita Industrial Park in August 1996. The conversion yielded over P2 billion for the Cojuangcos, but the farmworkers had to divide among themselves only P37.5 million or only 3%– instead of 33%– of the gross sale.

The massive land-use conversion in Hacienda Luisita consequently led to lesser mandays, lower production, much lower wages and the eventual retrenchment of farmworkers. The average take home pay of farmworkers amounts only to P18 for the seasonal or P9 for the casual for a two-manday week. The production of more than 300,000 tons of sugarcane per cropping season before the implementation of the SDO went down to 290,000 tons as soon as the SDO was implemented in 1989, to 248,471 tons in 2003.

Moreover, retrenched farmworkers’ names are removed from the payroll and they no longer receive any shares of stock thereon. Meanwhile, the names of new farmworkers– even those who are non-residents of Luisita and should therefore not be beneficiaries of the SDO but are favored by the management– appear on the payroll and thereon receive shares of stock on the basis of mandays.

Farmers’ choice?

It appeared that more than 90% of the HLI farmworkers voted in favor of the SDO. Presidentiable candidate and HLI part-owner Benigno “Noynoy” Aquino also claims that the SDO is what the Luisita farm workers wanted. However, reports disclose that an Israeli-British-trained “Yellow Army” composed of Luisita supervisors used malicious and coercive campaign strategies to convince farm workers to vote for the scheme. These tactics involved the distribution of pamphlets that asked “prinsipyo o kaldero?” (principles or the cooking pot?); convincing farmworkers with docked rifles or pistols; threats of retrenchment; and harassment against those who expressed opposition to the SDO. In December 2003, 80% of the farmworkers filed a petition criticizing the SDO and land use conversion in the Hacienda.

Impunity in distorting land reform, invoking violence and clinging to land monopoly

Through the SDO, the Cojuangcos have distorted the essence of land reform for their benefit. It masqueraded as ‘co-ownership’ between landowners and farmers, but has rid powerful landed families the obligation of actual land redistribution.

The travails which this posed on both peasants and farmworkers caused the unrest which hacienda goons and government troops attempted to quell violently in November 2004. The following years saw more Luisita peasant and union leaders opposed to the SDO falling victims to wide-scale retrenchment, murder and harassment. Yet, no specific entity has been held culpable of this violence. Instead, those who had command responsibility over the Luisita massacre have been absolved.

To this day, the Cojuangcos have also gotten away with defying the Supreme Court’s 2006 temporary restraining order directing the Department of Agrarian Reform and Presidential Agrarian Reform Commission to implement the revocation of the SDO. They insist that the SDO is a more rational option compared to outright land distribution because the land area of Luisita is much too small to be subdivided among thousands of farm workers. On the other hand, advocates of collective farming assert that land size should not be a problem and have proven that the method is more productive and beneficial for them, citing their practice of planting palay and cash crops as an example. In an apparent bid to ultimately leave nothing to their ‘co-owners’, the HLI has recently demanded the farmworkers to register until November 15 to allegedly determine the rightful tillers of 2,000 hectares of the hacienda lands– to be planted back to sugarcane.

More stock sharing schemes

Using the ‘corporative scheme’, known Marcos crony Eduardo “Danding” Cojuangco, Jr. formed a ‘joint venture corporation’ called ECJ & Sons Agricultural Enterprises Inc. (ECJSAEI) in Negros Occidental. In 1998, Cojuangco announced the distribution of Certificates of Land Ownership Award covering 3,773.5 hectares of the property as well as the free distribution of lands worth P1.5 million. But there has not been proof that this actually transpired. In fact, farmers were directed to pay for the land and moves were made to exclude more and more farmers from the ECJSAEI, leaving in control the workers that Cojuangco brought in.

Farmers disclosed that under the agreement, they were obliged to pay Cojuangco P350,000 in 10 years with a grace period of 5 years. More than 3,000 out of the 5,000 farmers registered as Agrarian Reform Beneficiaries (ARBs) of the Cojuangco properties were excluded from the CLOAs while 1,206 ARBs named in the CLOAs were unqualified as they held managerial positions. Meanwhile, hundreds of farmers– including some CLOA holders– have been retrenched by ECJSAEI.

The Cassava Project in Isabela is another joint venture initiated by Cojuangco with then governor Faustino Dy, Jr. where a ‘cooperative scheme’ between the San Miguel Corporation (SMC) and the Valley Planters Development Cooperative (VAPDECO) covers 29,000 hectares or 15% of the province’s total land area. Under the scheme, farmers belonging to the VAPDECO were forced to plant cassava for 10 to 25 years, receive loans in kind with a high interest rate of 36% per year and comply with SMC orders which would later include flour, starch, alcohol, and even sampaguita and ilang-ilang for a transnational corporation. As a peasant desk coordinator of a diocese in Isabela lamented, the once-independent farmers in the area have been turned into SMC-controlled farm workers. The hope of 3,000 indigents to receive land titles issued by government has also been railroaded by this project.

As of December 2006, more than 35% of all agrarian reform beneficiaries in the country are not title holders but are either leaseholders or stock holders. Aside from Luisita, there are 13 more recorded SDOs, nine of which are in Negros Occidental while the rest are in Iloilo and Davao. Since the infamous Hacienda Luisita massacre in 2004, calls for the cancellation of SDOs have become even more pressing. (Ibon Features /

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