Agriculture Sector Will Get a Big Boost Now That IRR of Agri-Agra Law is Out – Legarda

“MORE PRODUCTIVITY IN THE COUNTRYSIDE CAN BE EXPECTED NOW THAT THE IMPLEMENTING RULES AND REGULATIONS (IRR) OF THE AGRI-AGRA LAW IS OUT,” SAID SENATOR LOREN LEGARDA, FORMER CHAIR OF THE SENATE COMMITTEE ON AGRICULTURE WHO AUTHORED REPUBLIC ACT 10000 OR THE AGRI-AGRA REFORM CREDIT ACT OF 2009 IN THE SENATE.
The Senator said the spirit of the law was to boost the agriculture sector and to promote livelihood among agrarian reform beneficiaries.
“I urge farmers, fisherfolks, cooperatives and other agriculture stakeholders to avail of the benefits of this law so that agricultural productivity in the country will be further enhanced,” Legarda said.
The IRR, drafted by the Bangko Sentral ng Pilipinas (BSP), the Department of Agriculture (DA) and the Department of Agrarian Reform (DAR), in consultation with the banking industry, takes effect 15 days after its publication.
According to Legarda, RA 10000 requires banks to allocate 25 percent of their loanable funds to the agriculture sector to finance the acquisition of work animals, farm equipment or machinery, seeds, fertilizers, livestock, feeds and/or other similar items for farm production. Of the 25%, 10% should be given to agrarian reform beneficiaries and 15 percent to the agriculture sector.
RA 10000, which was signed into law by then President Gloria Macapagal-Arroyo on February 23, 2010, amended Presidential Decree 717 signed by then President Ferdinand Marcos on May 29, 1975.
Legarda explained that PD 717 also ordered banks to set aside 25% of their loanable funds for agricultural credit of which 10% should go to agrarian reform beneficiaries. But through the years, Congress and the Central Bank approved other ways of complying with it like investing in local government bonds, investing in socialized low-cost housing and in barangay microbusiness enterprises, therefore turning the funds away from its intended beneficiary-the agriculture sector.
Under the new law and IRR, there are still other modes of compliance but all are related to the advancement of the agri-agra sector like, for example, the extension of loans for the construction and upgrade of infrastructure including farm-to-market roads and post-harvest facilities; and extension of loans for warehouses/miller/wholesalers accredited by the National Food Authority.
“It also imposes stricter penalty for non-compliance,” Legarda said. “A bank that fails to comply with the law will have to pay a penalty equivalent to 0.5% of its non-compliance or under-compliance.”
Ninety percent of the fines collected will be remitted to the Agricultural Guarantee Fund Pool that funds rice projects, among others, and the PCIC that insures farmers against losses resulting from calamities and pest infestation.
“Productivity in the countryside can be expected with this new window of opportunity for our farmers. The Agri-Agra Law will secure a constant harvest and will abate our having to import rice, vegetables and other produce from other countries, ” Legarda concluded.