President Marcos Jr. yesterday signed into law Republic Act No. 12078 or the Amendments to the Agricultural Tariffication Act which extends the Rice Competitiveness Enhancement Fund (RCEF) for six years or until 2031 and provides for an increased annual budget of P30 billion from the current P10 billion.
The President, in his speech after signing the measure in a simple ceremony in Malacanang on Monday, said the measure aims to make the country’s rice industry more competitive.
He said the law will ensure farmers gain steady access to resources as well as reduce the post-harvest losses of farmers by preventing up to 375,000 tons of milled rice from being wasted annually.
Marcos said through the RCEF, the country has been able to invest in high-quality seeds and mechanization and provide training for farmers which equipped them with the right skills and tools to increase productivity.
“With the expiration of the original six-year plan for RCEF fast approaching, it became clear that we needed to extend and strengthen the program. This will enable us to do much more for our farmers, ensuring that they have the resources they need to succeed and to make the rice industry even more competitive,” he added.
The additional funding would be used to enhance the Seed Program and the Mechanization Program which will provide more farmers access to high-quality seeds to boost their yields.
The fund will go to priority projects such as training and extension services, financial assistance to rice farmers tilling up to two hectares of land, expanded rice credit assistance, composting facilities for biodegradable wastes, pest and disease management, soil health improvement, farming support programs on contract farming, and establishment of solar-powered irrigation systems.
Agriculture Secretary Fracisco Tiu Laurel said the P30 billion annual allocation for RCEF would go to the provision of providing high-quality rice seeds (P6 billion), farm mechanization (P9 billion), and the extension and training programs for farmers, financial assistance and credit, soil improvement, solar-powered irrigation systems, and water impounding projects (P15 billion).
RCEF also aims to increase the production and distribution of certified inbred rice seeds. Starting 2027, the Philippine Rice Research Institute is expected to be capable of distributing around 5.5 million bags of rice seeds annually, a 76 percent increase from current levels.
DA said such expansion will cover 2.54 million hectares and is expected to increase average yields by up to 21 percent in both dry and wet seasons, potentially feeding more than half of the population at a per capita consumption rate of 120 kg.
DA said the mechanization program, managed by the Philippine Center for Postharvest Development and Mechanization will provide free agricultural machinery to all rice-producing provinces.
The agency said the initiative aims to reduce post-harvest losses to as much as 8 percent from the current 5 percent, resulting in savings that are enough to feed about 3.4 million for a year. Once fully implemented, mechanization will cover 1.73 million hectares, improving productivity, lowering farming costs, and enhancing efficiency.
Stronger DA
The amended law authorizes the President to approve the importation of rice for a limited period or for specified volumes at a lower tariff rate.
In cases of extraordinary decreases in local rice price, the President may suspend the import of rice for a limited period and/or specified volume until the stabilization of rice supply and prices occur, the law stated.
The law also gives the Department of Agriculture the authority to regulate prices of rice and supply in cases of sudden rice shortages or price hikes as well as to take the necessary actions to stabilize the market and ensure that the price of rice remains affordable and accessible to every Filipino.
The National Price Coordinating Council shall come up with a formula to determine the prices of rice during extraordinary increases in the market.
The DA is also authorized to allow the selling of rice buffer stocks under the National Food Authority (NFA) to government agencies and the public through the Kadiwa ng Pangulo outlets in areas with rice supply shortages or extraordinary increases in rice prices.
The NFA is also allowed to replenishment its buffer stocks with locally produced rice or imported rice, should there be an inadequate supply of locally produced rice.
The Bureau of Plant Industry, meanwhile, is authorized to inspect rice warehouses and manage a national database to track grain storage, safeguarding our food supply and ensuring its safety for the public.
Vetoed provisions
While the President signed RA 12078 into law, he vetoed provisions in Sections 2 and 5 which he said are inconsistent with the principles of sound public fiscal management.
Marcos, in his veto message sent to Senate President Francis Escudero and Speaker Martin Romualdez, said he particularly opposed the setting aside of P5 billion from the current
unutilized portion of the DA’s annual budget and the more than P2 billion from the annual tariff income from rice importation collected by the Bureau of Customs to be credited to the rice buffer fund.
He said this goes against Section 44 of Executive Order No. 292, which states all accruing income of agencies shall be deposited in the National Treasury and shall be part of the unappropriated surplus of the General Fund of the Government.
“As such, I am constrained to veto a provision in Section 2 of the measure, which introduces a new Section 6(c), and a portion in Section 5 of the same bill, which amends Section 13, now Section 16(c)(2), of the Agricultural Tariffication Act as these may be inconsistent with the principles of sound public fiscal management,” he said.
“The line veto of the bill’s provisions is in adherence to the government’s ‘one fund’ policy, where the creation of special funds is discouraged to prevent the reduction of the national revenue, and in upholding fiscal discipline and proper resource allocation,” he added.
“Improving incomes from rice farming will attract a new generation of farmers to replace our aging workforce,” Tiu Laurel said.
Danilo Fausto, Philippine Chamber of Agriculture and Food Inc. president, told reporters in a briefing in Makati City on Monday any additional budget for the DA is “always welcome” but the use of those funds can be improved through higher utilization.
The Samahang Industriya ng Agrikultura (Sinag) the extension provides further support to the local rice industry.
“Those who oppose the extension of the RTL will also benefit from this new law. And we wish their cooperation so our farmers can benefit from this new law. We urge everyone to continue monitoring the implementation of (the law) so that our rice farmers will receive the appropriate funds and applicable programs that are allotted to them under RCEF,” said Jayson Cainglet, Sinag executive director, in a separate statement.
Cainglet cited the need to boost and strengthen support to local rice farmers to remove all the false narratives of economic managers on the need to import and reduce tariffs that are meant to be provided to our rice farmers under the new law.
“Only through increasing public support and providing additional incentives to our farmers in reducing cost of production and increasing palay yield; can we truly reduce rice prices,” Cainglet added.
Leonardo Montemayor, Federation of Free Farmers chairman, said the amendments will ensure “a bigger and more flexibly allocated funding for measures that will raise production and yields, safeguard soil health and enhance rice farmers’ incomes as well as protection against excessive rice importation.”
Montemayor said the law also provides DA with more powers to ensure adequacy of rice supply and stable rice prices. However, he said, it is unclear how tariff collections in excess of P30 billion yearly will be treated, whether the excess will still be plowed back to RCEF.
