Senator Francis Pangilinan. INQUIRER PHOTO
The Aquino administration will make available close to P2.7 billion in fresh funds for farmers and fishermen with the lifting of the moratorium on the corruption-tainted Agricultural Competitiveness Enhancement Fund (ACEF) which was allegedly used as a slush fund for the 2010 campaign by former President Gloria Macapagal-Arroyo.
Sen. Francis Pangilinan said Budget Secretary Florencio Abad Jr. had agreed to release P1.95 billion from the ACEF fund and another P700 million in fresh infusions beginning in September this year after the Congressional Oversight Committee on Agricultural and Fisheries Modernization agreed on Friday to institute measures to prevent the misuse of the fund.
“There is a clamor for more funds for the agriculture sector, especially with the calamities that have struck our farmers and fisherfolk in the last two years while the ACEF has been suspended. We agreed to reduce the loan component in the ACEF, which had been the biggest source of abuse,” Pangilinan said. It was learned that in the last administration, favored companies and individuals were getting loans without any collateral and without having to pay any interest, Pangilinan said in an interview.
Under the new guidelines, Pangilinan said 60 percent of the ACEF would be given as grants to deserving farmers and fishermen while another 10 percent would be given in scholarship funds to their relatives. “The government is not in the business of giving loans but giving grants,” said Pangilinan.
Stringent requirements
Only 30 percent would be earmarked for loans (down from 70 percent during the Arroyo administration) and Pangilinan said that this would be coursed through government financial institutions (GFIs) rather than state agencies. Pangilinan said the GFIs would implement more stringent lending requirements, including appropriate interest rates and minimum collateral requirements.
Fund releases from the ACEF were halted two years ago after the new administration questioned the unusually large amount of bad loans amassed under the P10-billion facility, which was created in 1996 as a safety net for farmers and fishermen affected by the trade liberalization policies of the government. When it was suspended in January 2011, the ACEF had P8.7 billion in unpaid loans accumulated during the nine-year term of the Arroyo administration.