NFA: NO DIVERSION OF FUNDS

The National Food Authority (NFA) vehemently denies that it diverted food security funds for other purposes because the P5.1 billion subsidy granted to the agency in 2017 was actually fully utilized for the procurement of palay, corn and imported rice for buffer stocking and food security during the year.

In its yearend report, the Commission on Audit (COA) did not even mention about diversion of NFA funds. Yet a news report said, " The Commission on Audit (COA) has called out the National Food Authority for diverting the P5.1 billion subsidy meant to ensure food security to pay off its maturing loans last year, possibly hampering the agency's ability to maintain a stable rice supply." This is not accurate and this places NFA in a bad light.

To set the record straight, NFA received the P5.1 B government subsidy from the Department of Budget and Management (DBM) on February 24, 2017. Of the total amount, the Bureau of Treasury (BTr) automatically deducted 10% or P510 million as payment for previous years' guarantee fee while P2.5 B represented payment of annual contribution for the P8 billion worth of 10-year Treasury Bonds issued to the NFA in February 2008. This means the NFA actually received net proceeds of only P P2.090 B out of the total subsidy.

The NFA operates under a One Fund Concept in managing its finances. This means all funds and revenues accrue to one General Fund where all expenditures for operations, programs and projects for food security, as well as for debt servicing are sourced.

During the exit conference with COA last month, the NFA was even commended for its prudent management of funds resulting to lower losses and timely settlement of its financial obligations.

At the end of the year, NFA submitted a report to DBM detailing the actual utilization of the P5.1 B subsidy.

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/RCO

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