MANILA — Finance managers of the National Food Authority (NFA) clarified on Thursday there was no diversion of the agency’s funds.
Media reports have quoted the Commission on Audit (COA) calling out NFA for “diverting” its 2017 procurement subsidy of PHP5.1 billion to payment of maturing loans, although in its yearend report, COA did not even mention about diversion of NFA funds.
In a statement, the NFA explained that it operates under a One Fund Concept. All funds and revenues, including subsidy, accrue to one General Fund, where all expenditures for operations, programs, and projects for food security, as well as for debt servicing, are sourced.
The agency said it received the PHP5.1-billion government subsidy from the Department of Budget and Management (DBM) based on a Notice of Cash Allocation issued on Feb. 24, 2017.
Of the total amount, the Bureau of Treasury (BTr) automatically deducted 10 percent or PHP510 million as payment for previous years’ guarantee fee, while PHP2.5 billion represented payment of annual contribution for the PHP8 billion worth of 10-year Treasury Bonds issued to the NFA in February 2008.
The NFA received on March 1, 2017 net proceeds of only PHP2.09 billion out of the total subsidy, the agency’s statement said.
“The PHP2.09 billion net subsidy was used to pay for importation and palay procurement, which is in accordance with the General Appropriations Act. In fact, the subsidy fell short, as NFA’s total cost of importation in 2017 amounted to PHP5.2 billion pesos,” the NFA said.
During the exit conference with COA in June, the NFA said it was even commended for its prudent management of funds resulting in lower losses and timely settlement of its financial obligations.
At the end of 2017, the NFA submitted a report to the DBM detailing the actual use of the PHP5.1 B subsidy.
“We assure the NFA people and the public that the agency’s funds are in good hands. Our records are open for scrutiny. In whatever we do, our guideline is that there should be no injury to government,” NFA’s finance managers said. (PR)