Government gathering proof on rice scam

MANILA, Philippines - The government is investigating and gathering evidence on the alleged anomalies in rice importation by the National Food Authority (NFA) with the end result of pressing charges against those found responsible.

“If the evidence warrants (charges will be filed),” deputy presidential spokesperson Abigail Valte said.

She said President Aquino’s exposé of the supposed irregularities in rice importation during the Liberal Party’s 65th founding anniversary last Wednesday was not done prematurely because even if the full audit is not yet finished, an informal audit was already conducted.

“The formal audit is ongoing, we will know by the end of the audit… I am not at liberty to discuss most of the details,” Valte said.

She said Aquino had instructed Justice Secretary Leila de Lima to look into the matter, but did not elaborate on the details of his instructions.

Aquino had alleged that only “one person or group” benefited from the importation of rice during the Arroyo administration.

Citing the audit by NFA administrator Lito Banayo, Aquino alleged that the imported rice was overpriced by $60 to $129 per metric ton (MT) based on the benchmark prices of the Food and Agriculture Organization.

The NFA also supposedly imported more than was necessary to address the shortfall in rice supply – 2.5 million tons instead of just 1.3 million tons. Aquino said some of the rice stocks in the warehouses had been rotting.

The government consequently had to rent 800 warehouses from the original plan of 400 to store the excess rice.

Aquino also said the NFA had incurred a debt of P176.7 billion during the Arroyo administration.

Sen. Franklin Drilon said the NFA causes financial burden on the national budget because of the huge losses it incurs every year.

These losses, he noted, are inevitable because the NFA is mandated to buy rice from local farmers at high prices and sell to the market at low prices, but the cause of debt is nonetheless worth investigating.

“This is certainly worth looking into. We must review the mandate of the NFA. We must review the powers of the board of the NFA in being able to incur this obligation and commit public funds without authority from Congress. Senate committee on agriculture chair Francis Pangilinan said the law creating the NFA might be reviewed to propose amendments.

“The charter of the NFA is over three decades old. It may be time to revise it, given the many changes that have taken place in the agriculture and food sector,” he said.

‘Unsubstantiated’

Former Agriculture secretary Arthur Yap, now Bohol representative, welcomed possible investigations into the alleged anomalies in the importation of rice.

He said the allegations were “unsubstantiated.”

Yap said that in the private sector importation program, private companies were allowed to import rice using their own funds “so they can assist government to stabilize local rice supply and prices by their own imports.”

“In this way, the government does not need to import the entire rice shortfall. So to be clear, no government funds are used here, these are private funds,” he said.

“If there is an allegation that only one group cornered the import volume, then it must be investigated and we must give the implementing agency, NFA, a chance to verify the allegations and determine if there was any wrongdoing involved,” he added.

He also said the inter-agency committee on rice and corn that included the Departments of Finance, Trade and Industry, Science and Technology, and Agriculture, had recommended the importation of 3.2 million MT for 2010.

When former President Gloria Macapagal-Arroyo ended her term on June 30 last year, the government had only imported 2.2 million MT and the private sector 245,000 MT.

Because of this, the recommended import volume was not breached. – Aurea Calica, Marvin Sy, Paolo Romero