Republic of the Phil
HOUSE OF REPRESENTATIVES 13 AUG 2013

Quezon Uk, 2 Kay

SIXTEENTH CONGRESS
First Regular Session

uno, 2398

Introduced by Representative Estrellita “Ging” B. Suansing

EXPLANATORY NOTE

Records show that rice accounts for almost 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. Therefore, 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 initiated as a preparatory step toward the longterm 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.

Representative Estrellita “Ging” Bf Suansing


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

H.No___ 2398

Introduced by Representative Estrellita “Ging” B, Suansing

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 |
GENERAL PROVISIONS

SECTION 1. Short Title - This Act shall be known as the "Immediate Rice Security Act of
2013."

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.

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.ldentification of Farmer Beneficiaries. Lach municipal agriculture office shall submit
a master list 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. - \f, 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.£ffectivity 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,