Republic of the Philippines
HOUSE OF REPRESENTATIVES
Batasang Pambansa, Quezon City

FIFTEENTH CONGRESS

First Regular Session

» 3279
HOUSE BILL NO.

INTRODUCED BY REP. JOSEPH VICTOR G. EJERCITO

EXPLANATORY NOTE

Rice accounts for 25% of food expenditures of the poorest 30%
of the Filipino population. Two out of every three poor persons are
dependent on agriculture for employment and sustenance. Thus, rice
prices have a significant impact on the well-being of the Filipinos,
including small rice farmers who are net buyers of rice for household
consumption.

It is evident then that not only is there is an urgent need to
revive the rice economy - to minimize the country’s vulnerability to
future external shocks and to reduce supply and price volatility - but
that in the immediate term, the rice supply gap can be minimized at
much less cost than what is usually resorted to. Thus, this proposed
measure seeks to mandate an immediate fertilizer support to Filipino
farmers of irrigated land in the form of a “buy 2-take 3” subsidy
scheme where farmer beneficiaries will receive in-kind 3 bags of urea
fertilizer per hectare of irrigated rice farm actually tilled to supplement
2 bags already privately purchased. This will ensure that farmers are
able to use the prescribed amount of
fertilizer per hectare, plus one more, to increase rice yields.

In conjunction with this, long overdue reforms and restructuring
in the National Food Authority will be jated as a preparatory step
toward the long-term goal of rice self sufficiency for our country. This
bill thus paves the way for redesigning NFA into a buffer stock
management agency that will check and maintain the rice reserve
requirement of the country. Necessary steps to make registration
processes more efficient and its corresponding fees more affordable
shall also be undertaken by the NFA in order to encourage private
sector participation in rice importation.

Fertilizer prices have more than doubled over the last two years,
making optimal usage unaffordable and optimal palay yields
unattainable. Combining fertilizer support with initiatives to reorient
the NFA into a buffer stock management agency, away from its
importation function, will set the stage to correct rice market


distortions that have been created by NFA intervention in the market
over the last three decades.

In view of the foregoing, urgent approval of this bill is earnestly
requested.

Te 7

JOSEPH VICTOR G. EJERCITO


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Batasang Pambansa, Quezon City

FIFTEENTH CONGRESS
First Regular Session

3279
HOUSE BILL NO.

INTRODUCED BY REP. JOSEPH VICTOR G. EJERCITO

AN ACT

TO INCREASE SHORT TERM GRAIN AVAILABILITY,
MINIMIZE VULNERABILITY TO EXTERNAL PRICE AND
SUPPLY SHOCKS AND ACHIEVE IMMEDIATE RICE
SECURITY, MANDATING FOR THAT PURPOSE THE
CREATION OF A FERTILIZER SUPPORT MECHANISM
AND THE RESTRUCTURING AND REORIENTATION OF
THE NATIONAL FOOD AUTHORITY, APPROPRIATING
FUNDS THEREFOR AND FOR OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the
Philippines in Congress assembled:

CHAPTER 1
GENERAL PROVISIONS

SECTION 1. Short Title - This Act shall be known as the
"Immediate Rice Security Act of 2010."

SEC. 2. Declaration of Policy. The State hereby reaffirms the
fundamental right of every person to adequate food and to be free
from hunger. Toward this end, the State shall provide immediate
strategic measures to ensure short-term availability of grain,
particularly the staple food rice and the sustained productivity growth
of agriculture. Thus, interventions that ensure the availability and
accessibility of crucial inputs to farming, especially fertilizer, shall be,
carried out by the State to maximize rice production in order to
increase the yield and meet the national requirement.

The initiation and execution of key reforms to address crucial
rice market distortions and to minimize the country’s vulnerability to
external price and supply shocks is hereby further declared a State
policy. Pursuant to this, the reorientation and transformation of the
National Food Authority into a buffer stock management agency shall
be undertaken and the implementation of measures that make private


sector participation in rice importation more feasible and accessible
shall be prioritized.

CHAPTER 2
FERTILIZER SUPPORT PROGRAM

SEC. 3. Creation of the Fertilizer Support Program. - As the
mechanism for extending government fertilizer counterpart to the
farmers, a Fertilizer Support Program (FSP) is hereby created which
shall be implemented per cropping season over the next fiscal year
immediately succeeding the enactment of this Act or for the duration
of the rice-crisis as determined by the President upon recommendation
of the Department of Agriculture, whichever is longer.

The Fertilizer and Pesticide Authority (FPA), in coordination with
the Department of Agriculture, shall be the primary agency tasked
with the implementation of the FSP. The FPA shall, within sixty (60)
days from the enactment of this Act, formulate the necessary rules
and regulations for the implementation of the Fertilizer Support
Program created by this Act.

SEC. 4. Fertilizer Subsidy Mechanism. - The FSP shall provide
“buy-two-take-three” in-kind urea (46% nitrogen) subsidy to qualified
farmers of irrigated land duly recognized by and registered with the
municipal agricultural offices (MAO) of their local government units.
Upon presentation of proof of procurement of two bags from a FPA
registered fertilizer dealer or retailer, the FPA designated distribution
centers shall give out the corresponding amount of in-kind urea
subsidy to MAO-registered farmer-beneficiaries ; Provided, however,
that the amount of urea granted to each farmer shall not be less than
two (2) 50-kgs. bags or more than three (3) 50 kgs. bags per hectare.

SEC. 5. Identification of Farmer Beneficiaries. -Each
municipal agriculture office shall submit a masterlist of qualified
farmer-beneficiaries, together with the corresponding area of their
ricefield to the Department of Agriculture. For the purpose of the
Fertilizer Support Program created under this Chapter, qualified
farmer-beneficiaries must:

a. Be an actual tiller;
b. Have a fully irrigated riceland; and
c, Undertake that he will apply the urea in his ricefield.

SEC. 6. Fertilizer Procurement. -The FPA, pursuant to their
charter, shall promulgate the necessary rules and regulations for the
importation of the required urea under the FSP; Provided that
Procurement shall be conducted through the government open
competitive bidding in accordance with the harmonized procedures on
procurement under Republic Act 9184 or the Government Procurement
Reform Act; Provided further, that the urea imported shall be directly
shipped to the respective FPA distribution centers.


SEC. 7. Monitoring and Assessment. -The Fertilizer and
Pesticide Authority, through their Provincial FPA Coordinators, shall
monitor the distribution and use of urea under the FSP, as well as
fertilizer availability, prices and movements. The Department of
Agriculture shall design a reporting system for the regional field units
to monitor and assess the impact of the FSP on rice farm productivity.
The MAFC shall assist the Provincial FPA Coordinators in the monitoring
and evaluation of the program.

SEC. 8. Prohibited Acts. -For the purpose of this Chapter, any
person who engages in any fraudulent transaction or manipulative
activity in order to influence the outcome of the public bidding process,
or engages in simulated or fictitious procurement process leading to
the awarding of a contract for the supply of fertilizers, shall suffer the
penalty of imprisonment of not less than twelve (12) years and one
(1) day nor more than twenty (20) years, without prejudice to
separate criminal prosecution under Republic Act No. 3019, otherwise
known as the Anti-Graft and Corrupt Practices Act and other penal
laws.

CHAPTER 3
REORIENTATION OF THE NATIONAL FOOD AUTHORITY

SEC. 9. Reforms in the National Food Authority - The
National Food Authority shall, within one (1) year from the effectivity
of this Act, formulate and implement guidelines to phase out its
Participation in rice importation: Provided that the NFA shall undertake
a comprehensive review of its plans and programs and redesign the
same to focus on the management and maintenance of proper levels
of buffer stock requirements of the country.

SEC. 10. Rice Importation. - The NFA shall establish rules and
regulations that will make participation in importation of rice more
feasible and accessible to the private sector. Within sixty (60) days
from the effectivity of this Act, the NFA shall have amended its
guidelines to facilitate and allow for a shorter registration process and
reduced associated fees to encourage private sector, especially farmer
organizations’ participation in the rice importation business. Along with
this, the NFA shall implement necessary restructuring in their
programs in order to make vital information that ensure timely and
sufficient
importation of rice available to duly registered rice importers.

CHAPTER 4
FINAL PROVISIONS

SEC. 11. Congressional Oversight Committee. - For the
effective implementation of this Act, a Congressional Oversight
Committee on Rice Security Program is hereby created, hereinafter
referred to as the Rice Security Program Oversight Committee, to be
composed of five (5) members each from the Senate and the House of
Representatives. The Rice Security Program Oversight Committee shall
be jointly chaired by the Chairs of the Committee on Agriculture and


Food of both Houses, with the Chairs of the Committee on Trade and
Commerce of both Houses acting as vice-chairs. They shall meet bi-
annually to monitor and review the status of implementation of the
provisions of this Act. For this purpose, the Rice Security Program
Oversight Committee shall have the power to require the submission
of status reports and other necessary data and information.

SEC. 12. Appropriations. - For purposes of the FSP created
under Chapter 2 of this Act, a special fertilizer support fund, which will
be used by the FPA in the importation of urea under this program, in
the amount of Fifteen Billion pesos (Php15,000,000,000.00) per
cropping season for the fiscal year immediately following the
enactment of this Act, shall be specially appropriated, released to and
administered by the FPA; Provided, that appropriations for the FSP
shall continue and be maintained for the duration of the rice crisis as
determined by the President pursuant to Section 3 of this Act.

SEC. 13. Rules and Regulations. - The Department of
Agriculture, in consultation with relevant government agencies and
LGUs, farmer organizations and other stakeholders, shall, within one
hundred twenty (120) days from the effectivity of this Act, promulgate
the necessary rules and regulations to effectively implement the
provisions of this Act.

SEC. 14. Separability Clause. - If, for any reason, any section
or provision of this Act shall be held unconstitutional or invalid, the
other section or provision not otherwise affected shall remain in full
force and effect.

SEC. 15. Repealing Clause. - All laws, presidential decrees,
executive orders, proclamations, rules and regulations which are
inconsistent with the provisions of this Act are hereby repealed or
modified accordingly.

SEC. 16. Effectivity Clause. - This Act shall take effect fifteen

(15) days after its publication in the Official Gazette or in at least two
(2) newspapers of general circulation.

Approved,