Converting ACEF into a revolving fund will be a departure from the current system of remitting proceeds of tariff collected from the importation of products covered by the minimum access volume (MAV) mechanism.
Under the current system, tariff proceeds are remitted by the Bureau of Customs (BOC) to the Bureau of Treasury (BTr) and deposited under Special Account 183. It is the Department of Agriculture’s (DA) National Agricultural and Fishery Council (NAFC) which evaluates and endorses proposed projects to the ACEF executive committee and the Congressional Oversight Committee on Agricultural and Fisheries Modernization (COCAFM).
These are then submitted for funding by the Department of Budget and Management (DBM). The fund, once paid up by sectors that availed of it, is reverted back to the general fund.
Under the proposed revolving fund, loans paid by beneficiaries are kept intact since these go back entirely to the general fund of the DBM which has been criticized for its snail-paced disbursement of the fund.
"There is a definite advantage if we have the nature of the fund changed because it will be easier to disburse the fund while expanding then number of beneficiaries," ad hoc task force member Pete Borja said, adding mechanisms will also be created to cut short the waiting period before funds are released.
Borja aid the shift to a revolving fund is one of the integral components of an earlier proposal of the ad hoc task force for Congress to extend the program until 2015. The program is due to expire in 2005.
In a previous statement, the task force led by the committee on food crops, poultry, livestock and feed crops of the NAFC, said more time is needed for the DBM to disburse funds for proposed projects.
Borja said there is concern that if the fund is not disbursed when it expires in 2005, the accumulated amount will be reverted back to the general fund, thus, making it difficult, if not impossible for projects approved, to avail of funding.
The ACEF was created out of the tariff proceeds of the minimum access volume (MAV) importations. It is part of the safety nets pledged by government to make local agricultural producers globally-competitive by improving their infrastructure and marketing systems.