Set of rules for coco levy fund disbursement out soon–dof
THE set of guidelines on the disbursement of allocations under the coco levy trust fund for the implementation of programs and activities is eyed to be completed by the second week of August, according to the Department of Finance (DOF).
This comes after members of the Trust Fund Management Committee approved last July 30 the principles that will establish the disbursement framework for the 15 implementing agencies tasked to carry out programs and activities to benefit coconut farmers and the industry. The TFMC is mandated to oversee the utilization of the Coconut Farmers and Industry Trust Fund (CFITF).
The interagency TFMC was created under the law to oversee and set the investment strategy of the CFITF.
The programs, projects and activities to be financed through the coco levy trust fund must be in line with the Coconut Farmers and Industry Development Plan (CFIDP), which
the Philippine Coconut Authority is currently finalizing.
“The important message there is that the implementing agencies cannot delay; they have to use the allocations and there is no excuse for delaying a program that you yourself planned,” Finance Secretary and TFMC Chairman Carlos G. Dominguez III said. “Unless of course, you know there is a typhoon or another pandemic or crisis.”
Apart from the approval of the disbursement framework, the TFMC also discussed in its second meeting the setting up of the Office of the Trust Fund Manager, which will implement the investment strategy set by the TFMC and manage the portfolio. Finance Undersecretary Antonette C. Tionko, who was earlier designated the trust fund manager of the CFITF, also presented the budget proposal for the Office.
Under Republic Act (RA) 11524 creating the CFITF, the trust fund manager is tasked to, among others, monitor market and economic trends and track securities in order to make informed investment decisions. It is also tasked to recommend its portfolio strategy to the TFMC and track financial results of the companies in the portfolio and its various metrics, such as, but not limited to, price-to-earnings ratios, inflation-adjusted return, sales, earnings, and dividends. The trust fund manager is also tasked to recommend the designation of entities that will dispose the coco levy assets.
During the meeting, the Presidential Commission on Good Government (PCGG) also reported that total coco levy cash assets as of end-2020 amounted to P113.88 billion, of which P76.4 billion is cash. This amount shall be transferred to the CFITF in tranches over five years.
National Treasurer Rosalia V. De Leon, head of the TFMC Secretariat, asked the PCGG to provide a quarterly report to the TFMC on its discussions with the Commission on Audit (COA) regarding its inventory.
The COA is mandated under the law to audit the PCGG inventory “to determine the completeness of said inventory, establish the reasonableness of the asset valuation, trace the flow of the coconut levy funds, and to determine compliance with pertinent laws, rules, and regulations on the re-conveyance of the Coconut Levy Assets and/or Funds to the Republic.”
The TFMC also ordered a continuous update on the status of coco levy assets in a bid to ensure transparency, accountability, and prudence in the management of CFITF.
Meanwhile, the Department of Justice shall be responsible for the review of the status of assets under litigation to ensure their timely privatization as required under the law.
Numerous checks and balances have also been put in place by TFMC to ensure proper utilization of the coco levy funds, such as the establishment of Coconut Levy Asset Registry, which shall serve as the repository of all information related to coco levy assets and shall be periodically updated; and the regular monitoring of the status of disbursements of the implementing agencies.