Genuine Small Coconut Farmers’ Fund Act of 2005:
Taking Control of the Coco Levy Funds

Finally, a bit of good news for small coconut farmers. Pending at the House of Representatives is a bill that would bring back the funds to the small coconut farmers, where the funds truly belong.

BY DABET CASTAŃEDA
Bulatlat

After being mired in controversy for being the alleged source of corruption by both public and private individuals, the coconut levy funds might finally find its way to where it rightfully belongs – the small coconut farmers.

House Bill 3728 (HB3728) or the Genuine Small Coconut Farmers’ Fund Act of 2005, seeks to declare the coconut levy fund and the assets acquired and established from it as public funds. It also seeks to create the Coconut Industry Rehabilitation Development Council (CIRDC) to administer and manage the funds.

“This is a social justice measure that seeks to rectify the historical injustice that has befallen the small coconut farmers for many years,” said its main proponent, Anakpawis (toiling masses) Party-list Rep. Rafael Mariano.

Mariano filed the bill during Congress’ first regular session. It has yet to be heard by the Committee on Agriculture and Food (CAF) where the proponent is the vice-chair.

Salient features

Mariano, a peasant leader, said the bill will declare all coco levies and assets acquired or established through the funds as public funds to be used exclusively for the small coconut farmers and the rehabilitation of the industry.

It differs, he said, from the Supreme Court (SC) decision in 2001 which declared all coco levy funds as “prima facie public funds,” meaning the funds were put exclusively into the public coffers.

The problem there, Mariano said, was that it still opened the doors for corruption.

HB3728 also aims to establish a council that would administer the coco funds. Sections 11 and 12 of the bill says that the CIRDC will have nine regular members composed of seven representatives including women farmers from the genuine coconut farmers sector.

The two other members will come from non-government organizations involved in rural development advocacy and in legal assistance services to coconut farmers.

The council will also have two ex-officio members from the Philippine Coconut Authority (PCA) and the Presidential Commission on Good Government (PCGG).

For years, public institutions such as the PCA, the Philippine Coconut Producers Federation (Cocofed) and the United Coconut Planters Bank (UCPB) had administered the levies. The PCGG took over the administration of the funds in 1986.

The bill also seeks to conduct a thorough audit and inventory of all assets acquired, established and/or funded by the coconut levy collections.

Criminal liability also awaits those who have misused the coco farmers’ funds, Mariano said.

Some levy assets

In a House hearing held last May 17, former PCGG Commissioner Heidee Yorac told the CAF that the trust account in the UCPB has been divided three ways: to Finance, which is represented by the UCPB; Insurance, which consists of seven insurance companies; and oil mill groups represented by the Coconut Industry Investment Fund (CIIF).

According to Yorac, it was the CIIF funds that were used by known Marcos crony Eduardo “Danding” Cojuangco Jr. to buy 47 percent shares from San Miguel Corporation (SMC). He also sat as SMC chair and CEO.

Through the PCGG, the Aquino government sequestered these shares, and all other Marcos assets, after the 1986 people’s uprising that toppled the Marcos dictatorship. Subsequently, the PCGG took over the administration of the funds.

It was during the Estrada administration that Cojuangco re-established himself at the helm as, again, the chair and CEO of SMC, and therefore reclaiming his shares in the company.

On July 11, 2003, the Sandiganbayan declared illegal the 27 percent UCPB shares in SMC. This decision led to PCGG’s administering 27 percent of the shares. Cojuangco however retained control of the 20 percent or majority of the SMC shares.

Support

Considering the composition of the House – a pack of landlords and big business - Mariano expects the bill to likely “invite debate” among his colleagues, especially those affiliated with Cojuangco.

But with its progressive provisions that truly invoke the interest of those who rightfully owns the funds, the peasant solon counts on the support of genuine small coconut farmers.

Mariano was quick to say, however, that the bill would only pave the way for a legal provision to the fund. The success of the bill, and the cause of the coco farmers as a whole, would largely depend on the persistence of the progressive peasant movement, he said.

The coco levies were extracted from coconut farmers from 1971 to 1982. The first on the strength of Republic Act 6260 (RA 6260) that imposed .55 cents per 100 kilos of copra. On Aug. 20, 1973, Presidential Decree 276 (PD 276) imposed a P15 levy per 100 kilos of dried copra. In the succeeding nine years, the levy went up to a maximum of P100 per 100 kilos or dried copra.

At the end of the levy period, the funds accumulated reached P9.695 billion. According to reports, the principal and interests could reach about P150 billion today. Bulatlat 

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