MANILA – President Rodrigo Duterte on Monday said he vetoed the bill that seeks to provide a P100-billion trust fund for coconut farmers in the country due to lack of “vital safeguards.”
Duterte, in a letter addressed to the Congress, said the lack of vital safeguards of the coco levy fund bill might cause a repeat of past mistakes that may be of violation to the Constitution.
“After much deliberation, I have come to the conclusion that the bill may be violative of the Constitution and is lacking in vital safeguards to avoid the repetition of painful mistakes committed in the past,” Duterte said.
According to the President, establishing an “effectively perpetual” trust fund would violate Article IV Section 29(3) of the 1987 Constitution which states that money collected from tax levied for a special purpose shall be treated as a special fund and paid out for such purpose only.
“The trust fund could disproportionately benefit wealthy coconut farm owners because of the absence of a limit on the covered land area for entitlement of benefits,” Duterte said.
The President added: “The broad powers given to the Philippine Coconut Authority also undermine relevant regulations and safeguards from abuses. The provisions do not reflect the Palace’s goal of accelerating the full utilization of coco levy assets and funds for marginalized coconut farmers and the coconut industry.”
Had the measure been signed by Duterte, it would reconstitute the Philippine Coconut Authority (PCA) to manage the P76 billion in coco levy funds such that they benefit coconut farmers and the sector as a whole.
The coco levy was tax paid by coconut farmers during the Marcos regime. The Supreme Court had ruled in 2012 that the funds must now be used only for the benefit of the farmers and the coconut industry.
In the vetoed bill, the coco levy funds would be managed by the PCA, the same agency that had abused the funds in the 1970s. In a bid to prevent such misuse, lawmakers decided to craft a twin bill reconstituting the PCA.
The bill went through two bicameral conference committee meetings as the Palace raised issues with the composition of the council that will manage the fund, and the lack of sunset provisions for the funding for coconut farmers.
The vetoing of the measure came a week after Duterte also vetoed the bill seeking to strengthen the PCA as the measure “regrettably lacks vital safeguards to avoid the repetition of painful mistakes in the past.”/PN
