Saturday, September 23, 2017

House approves creation of coconut industry trust fund on 2nd reading | BusinessMirror

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House approves creation of coconut industry trust fund on 2nd reading

-September 20, 2017

THE House of Representatives on Wednesday approved on second reading a measure creating the Coconut Industry Trust Fund.

The measure, which seeks to create a Coconut Industry Trust Fund and amend Republic Act 6260, or the Coconut Investment Act that created the coconut-levy fund, was approved through viva-voce voting. The bill is expected to be passed on third reading next week.

Party-list Rep. Jose Panganiban Jr. of Anac-IP House Committee on Agriculture and Food chairman and one of the authors of the bill, said the Supreme Court declared in 2012 the coconut-levy fund as owned by the government, to be used solely for the benefit of coconut farmers and for the development of the coconut industry.

Based on the Supreme Court ruling in Cocofed, et al v. Republic of the Philippines (GR 177857-58), it declared the coco-levy funds and assets, which consist primarily of the 753,848,3312 shares of San Miguel Corp. and their accumulated dividends, are owned by the government in trust for the coconut farmers.”

Panganiban, citing the Bureau of Treasury, said, “The total amount of the coconut-levy fund is P62.5 billion in cash, deposited in a special account in the general fund, which is not earning interest because it cannot be invested, adding it needs a law in order to be utilized.”

The other amount of P13.09 billion is held in escrow and earning interest, he said.

It also provides that P10 billion of the initial trust principal be used within two years from the approval of the “Coconut Farmers and Industry Development Plan” by the President of the Philippines.

The measure said the Coconut Farmers and Industry Development Trust Fund Committee shall be created, under the Office of the President, which shall monitor the implementation of the Coconut Farmers and Industry Development Plan and approve disbursements out of the trust fund.

“The Coconut Farmers and Industry Development Trust Fund, hereinafter referred to as the trust fund, shall consist of the Trust Principal and the Trust Income. No portion of the trust fund shall accrue to the general fund of the national government. It shall be capitalized, managed, utilized and accounted for in the manner provided in this Act,” Panganiban said.

The trust fund shall be used exclusively for the ultimate benefit of coconut farmers and farmworkers, as embodied in the Coconut Farmers and Industry Development Plan prepared under this measure.

All assets and/or properties derived from all coconut levy-recovered assets; and all dividends, interest earnings and incomes that are available upon the effectivity of the Act shall form part of the initial capital of the trust fund.

The trust fund shall thereafter be augmented. It with all proceeds of privatization/disposition of the coconut-levy assets remitted directly thereto by the PMO in accordance with the Act, including any and all forms of income, interests, earnings, yields, or any monetary benefit derived therefrom prior to the privatization/disposition of these coconut-levy assets.

In order to ensure the enduring character of the trust fund, the principal thereof shall be augmented by grants, donations and other lawful transfers by public or private entities.

It also provides for the naming of nine representatives from the coconut farmers’ organizations (three representatives each from Luzon, the Visayas and Mindanao) as among the members of the Coconut Farmers and Industry Development Trust Fund Committee.

The bill provides for the creation of an ad hoc committee that shall prepare every 10 years a plan of programs, projects and activities to be funded from the trust fund.

It also mandates the Presidential Commission on Good Government (PCGG) to undertake a full accounting and inventory of all coconut- levy assets; and the Commission on Audit to audit the inventory of the coconut-levy assets prepared by the PCGG.

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