THE provincial government of Ilocos Norte may have to enforce a work-for-loan payment swap for farmers and agricultural cooperatives who took out zero-interest loans from the provincial government dating back 22 to 14 years ago but are unable to pay back their obligations.
In the 2021 audit of the province released last May 16, the Provincial Agriculture Office said it will call in the borrowers of the P32.6 million farm assistance fund released between 2000 to 2009.
The provincial government admitted to the audit team that it has encountered difficulties in collecting the loans as the farmers appear to have misunderstood the purpose of the fund releases.
“Most of the known borrowers claimed that these were not payables on their part but rather were financial assistance given to them,” the auditors noted.
The Commission on Audit flagged the provincial government for its low collection performance, noting that a whopping 80 percent or P32.6 million out of the P40.76 million loan receivables have not been paid for more than 10 years.
Had the sum been collected, the commission said the money could have gone to other equally important projects and programs of the province.
It recommended that the provincial government should explain to the farmers and the cooperatives that the amounts released are not obligation-free assistance but were in fact loans that they are required to repay.
The Provincial Accountant said it will coordinate with all heads of implementing offices to evaluate the capacity of borrowers to pay their loans.
“Those borrowers who no longer have the capacity to pay will either be subjected to community service or their loans will be considered for condonation subject to the approval of the Honorable Governor and the Sangguniang Panlalawigan,” the auditors said, quoting the remarks of the provincial government to the audit findings.
