Under Teves’ proposal, CARP beneficiaries who till the land would be able to amortize their land acquisitions in 10 to 15 years while land owners would be amply paid for their properties.
Teves’ proposal is contained in a memorandum he sent to President Arroyo, Agrarian Reform Secretary Hernani Braganza, Agriculture Secretary Leonardo Montemayor and Land Bank of the Philippines President Margarito Teves.
Teves made the proposal in his capacity as chairman of the House special committee on globalization.
He stressed that the success of agrarian reform would be "crucially important" to the global competitiveness of Philippine agriculture. He proposed a project feasibility study where:
• The CARP beneficiary who tills the land would be extended a crop loan (to include subsistence allowance);
• Land owners are provided just compensation for their properties;
• National food security is assured and CARP beneficiaries are actually provided gainful livelihood and/or full employment; and,
• The beneficiary, when still unable to amortize the land or pay for the crop loan despite full government support, would be disqualified in favor of another tenant.
Teves lamented that after 14 years of implementation, CARP managed to distribute only 3,128,849 hectares of land to 1,754,277 beneficiaries.
"At the rate CARP is being implemented and getting little support, it threatens to become a massive failure that could worsen rural poverty and food shortage," Teves warned.
To illustrate the feasibility of his proposal, Teves, for instance, suggested that irrigated rice land be valued at P200,000 to P300,000 per hectare.
Assuming minimum production of seven tons of palay or 4,115 kilos of clean rice per hectare and a minimum selling price of P15 per kilo, a beneficiary should be grossing an income of P61,750 per annum, according to Teves.
Assuming further a P25,000 crop loan per hectare (to cover the P20,000 cultivation cost plus P5,000 food allowance) with an interest of 12 percent per annum plus six-percent annual interest on the land acquisition loan, Teves said the beneficiary would actually end up spending only a total of P28,000 each year.
This would leave the beneficiary a net income of P33,750 per annum for each hectare, he pointed out.
Teves also illustrated the viability of his proposal using the same formula for non-irrigated rice land and other crop farms.