A YEAR after it was abolished by former President Duterte on December 1, 2021, Northern Foods Corporation (NFC) continues to lose millions due to the failure of the government to finalize and approve its plan of liquidation.
In a report released yesterday, the Commission on Audit (COA) said the Governance Commission for GOCCs (GCG) has failed to convene the Technical Working Group (TWG) that was supposed to resolve pending issues, including compensation of NFC’s employees who are losing their jobs, liquidation of the government firm’s assets, and the settlement of its liabilities.
The TWG is composed of the GCG, the Department of Agriculture, the Land Bank of the Philippines, the Department of Budget and Management, and the Privatization Management Office.
Based on the dissolution plan, 50 NFC employees in the first batch of separation have stopped receiving wages as of March 31, 2022.
As of the yearend 2022, there are only 22 remaining employees on the payroll as skeleton workforce to continue residual functions and provide support to the liquidation proceedings.
Audit showed the NFC’s assets declined by P90.4 million year on year from P247.16 million in 2021 to P156.75 million in 2022.
With liabilities listed at P1.045 billion, the NFC is now P888.46 million in the hole.
Other than displaced workers, also adversely affected by NFC’s closure were more than 1,500 Ilocano farmers who depend on it for regular income as tomato contract growers.
The NFC whose plant is based in Sarrat, Ilocos Norte was a major supplier of tomato paste to food chains, sardine makers, and tomato sauce/catsup manufacturers.
As of yearend 2021, it had a production area covering 365 hectares, produced 12,914 tons of tomato fruit, and sold 2,849 tons of tomato paste.
It also had 146.7 kilograms of hybrid tomato seeds and was conducting studies on natural control of tomato pests and development of more climate-resilient hybrids.
Based on COA’s records, NFC had unpaid loans totaling P214.787 million as of December 31, 2022, including P72.17 million from the Agricultural and Credit Policy Council, P62.78 million from the National Livelihood Development Corp, and P53.52 million from the Human Settlements Development Corp.
However, those loans have incurred interests that have ballooned to P780.59 million as of last year.
All of these creditors are also government corporations.
