2 agri agencies first to be axed

Agriculture Secretary Proceso Alcala on Monday told senators that he was targeting the abolition of two government-owned and -controlled corporations (GOCCs) implicated in the pork barrel scam by the end of the year.

Briefing the Senate committee on agriculture and food on the agriculture department’s programs in the next three years, Alcala confirmed that the days of National Agribusiness Corp. (Nabcor) and Znac Rubber Estate Corp. (ZREC) were numbered.

Nabcor and ZREC are among the five state entities that Malacañang wants abolished in the wake of the misuse of the Priority Development Assistance Fund (PDAF), the official name of the graft-ridden pork barrel, which finances pet projects of lawmakers.

The others are Philippine Forest Corp. (Philforest), an agro-forestry arm of the Department of Environment and Natural Resources (DENR); Technology Resource Center of the Department of Science and Technology; and National Livelihood Development Corp. of Land Bank of the Philippines.

It was Environment Secretary Ramon Paje who earlier disclosed that President Aquino had asked the Office of the Government Corporate Counsel to study the abolition of the five state entities.

Paje said Aquino was “extremely disappointed” with how the pork barrel scam continued into his administration, particularly with the release of

P428.5 million in the PDAF of two senators (Gringo Honasan and Lito Lapid) and 24 members of the House of Representatives to the five state companies.

The P428.5-million pork barrel was released from October 2010 to December 2011 to nine fake nongovernment organizations (NGOs), which do not belong to the network of bogus NGOs put up by detained Janet Lim-Napoles, the alleged mastermind of a P10-billion scam in 10 years.

Apart from being linked to the scam, Nabcor has incurred huge debts from the Agriculture Enhancement Competitiveness Fund that it could no longer recover from these, Alcala said.

“We’re weighing whether to allow this to continue. Otherwise, the government might go bankrupt. We don’t want this to happen under our watch,” he told reporters after the briefing.

Advanced stage

Alcala said ZREC was under an “advanced stage” of abolition.

The ZREC, organized in 1984, was too small a company to operate a 400-hectare rubber plantation in Zamboanga Sibugay. But it could have been allowed to continue operating until it was linked to the scam, Alcala said.

“Since it was used for inappropriate purposes, it’s better to close it down,” he said.

In announcing the abolition of the PDAF on Aug. 23, President Aquino singled out Nabcor and ZREC as the GOCCs that would be abolished.

“Both of these GOCCs will be abolished, along with others of their kind that have become notorious for anomalies, and which seem to serve no other purpose aside from being instruments of corruption,” the President said.

State auditors reported last month that ZREC had been designated as the recipient of a combined P201 million in pork barrel from Senators Juan Ponce Enrile, Jinggoy Estrada and Ramon Revilla Jr., and former Buhay Rep. Rene Velarde.

The special audit showed that ZREC released P194.97 million of the funds in several tranches from 2009 to 2010 to a bogus NGO, Pangkabuhayan Foundation Inc. (PFI).

Testifying before the Senate blue ribbon committee, Commission on Audit chair Grace Pulido-Tan also identified Nabcor and ZREC as the GOCCs that implemented the release of pork barrel funds into Napoles’ bogus NGOs between 2007 and 2009.

Tan said that Enrile, Estrada, Revilla and Honasan allotted a total of P1.093 billion of their pork barrel to the bogus NGOs in that period.

Nabcor’s huge loans

Alcala said that when he was appointed agriculture secretary in 2010, he discovered that Nabcor had incurred huge loans, and because of this, it had difficulty in turning itself around.

“We can’t fold up just like that, lest we will be accused of concealing evidence. We are willing to share any information with any government agency that wants to investigate this,” he said.

But otherwise, Alcala said he was discussing with labor officials how the abolition of Nabcor would impact on its employees.

On the other hand, Alcala said he had been working on the abolition of ZREC for six months now.

“It’s up to GCG (Governance Commission for GOCCs) to run after them (past heads of Nabcor and ZREC) because they have the personality to do this, and the department will provide whatever support and evidence that they will need,” he said.

Sen. Cynthia Villar, chair of the Senate agriculture and food committee, said the Department of Agriculture could transfer the functions of Nabcor to another agency without the need for legislation. “Legislation will make the process longer,” she said.

Appetite for pork

While the DENR has long lost its taste for pork, a subsidiary of its attached agency continued to serve as a conduit of the PDAF.

At a press conference on Monday, Paje said that a question that Philforest should answer was why it continued to receive a piece of the pork barrel from 2010 without reporting about it until late last year.

He said he would support a full abolition of Philforest if the GCG recommended it.

Paje explained that when he was appointed environment secretary, he had requested during budget deliberations in 2011 that his department be delisted from the PDAF menu.

“Successfully, we (DENR) were deleted. That is why in the 2012 budget, 2013 and in the deliberation now for the 2014 budget you will find out that the department is no longer in the menu,” he said.

Paje said this was based on his policy of not using the PDAF so that the DENR could not be asked to do something outside of its work program.

Paje said the releases, referring to the PDAF channeled through Philforest, “were actually not coursed through us. These were released directly to the corporation which should have coursed it through us (DENR) if they want us to be accountable for it.”

Philforest is a GOCC under National Resources Development Corp. (NRDC), an attached agency of the DENR.

Kept in the dark

Paje said the PDAF released directly to Philforest was only made known to the board of directors in November 2012. The board is composed of the environment secretary, the NRDC president, Office of the Government Corporate Counsel and the Philforest president.

Paje issued a memorandum on Nov. 29 last year for Philforest to submit a full report, an accounting and evaluation of all the projects to which the PDAF released to the GOCC went.

“They (Philforest) submitted already all the reports but the report is only dated Aug. 28, 2013,” Paje said. “Why were these not reported to the board until November of 2012? They have to answer that.”

Management fee

Paje explained that from the PDAF releases, Philforest charged a management fee of 3.5 percent to 5 percent as a conduit before it disbursed the allocation for the NGO identified by a lawmaker.

Paje added that monitoring and verifying the recipient should have been Philforest’s accountability.

“I am inclined to support its abolition … but the process should be followed. Its job can be done by another agency,” he said, pointing out that its functions can be absorbed by the NRDC or some functions can be assumed by the Bureau of Forest Management.

With the COA reporting delinquencies at Philforest since 2006, Paje said, “That justifies my recommendation. If the Governance Commission of the GOCCs recommends the full abolition, I will support it.”

Originally posted: 7:58 pm | Monday, September 2nd, 2013