THE Provincial Board of Iloilo has approved the P100-million supplemental budget intended to help small farmers cope with the drop in the prices of palay.
The amount will be extended to accredited farmer cooperatives through a loan with two percent interest. In turn, the cooperatives will buy palay from small farmers at premium prices.
These are farmers tilling below one hectare of land.
"We want to help small farmers who cannot access the price of the National Food Authority due to high moisture content of their produce," Governor Arthur Defensor Jr. said.
The Provincial Board also gave the governor the authority to enter into an agreement with the cooperatives for the payment terms.
Initially, the loan was of zero interest. But Defensor said they have to put safeguards to make sure that the government fund is spent properly.
"The cooperative is a private entity that is why we are being careful. We could help more if there is no interest but I think we have no choice," he said.
The amount will depend on the debt ceiling of the cooperatives. The maximum credit amount is P15 million.
Only those with good credit standing and track record can avail themselves of the loan. They must also have drying facilities.
As of now, 12 cooperatives were identified for the loan program.
The Provincial Board approved the supplemental budget during its special session on October 3, 2019. The amount will be taken from the unappropriated surplus for calendar year 2018.
Defensor thanked the Provincial Board for its support to the programs of the Provincial Government.
The loan aid is the province's response to the call of the National Government to help farmers manage the effect of the Rice Tarrification Law.
There are 114,000 farmers in Iloilo Province, of which 7,953 are small farmers. (PR)