THE Mandaue City Government will return 397 unsold sacks of rice from the Sugbo Merkado Barato (SMB) program to the Cebu Provincial Government after confirming the stocks are no longer safe for human consumption.
Mayor Thadeo “Jonkie” Ouano said the decision was made because there was no written contract between the City and the Province covering the rice allocation.
Without such an agreement, Ouano said the best course of action is to return the remaining sacks stored in Barangay Tawason.
“Walay contract gyud ana noh, so amo na lang gyud to ibalik katong nahabilin nga naa sa Barangay Tawason. Hopefully, dawaton sa Province para ma-dispose nato properly,” Ouano said.
(There’s really no contract for that, so we’ll just return what’s left in Barangay Tawason. Hopefully, the Province will accept it so we can dispose of it properly.)
The SMB program was launched by the Cebu Provincial Government in 2023 under then governor Gwendolyn Garcia to make affordable rice and basic goods accessible to indigent families amid rising inflation.
Mandaue received 1,099 sacks of National Food Authority (NFA) rice to be sold at P20 per kilo, with each listed beneficiary allowed to buy only two kilos per week.
The list was based on the Department of Social Welfare and Development’s Listahanan 3, which for Mandaue covered 4,133 beneficiaries.
City Administrator Gonzalo Malig-on Jr. said a joint inspection by the City Agriculture Office and the City Health Office on August 4, 2025, confirmed that the rice in opened sacks showed signs of physical contamination, while unopened sacks are still undergoing further tests.
Ouano has ordered that no part of the stock should be sold or distributed.
According to Ouano, feedback from the City Social Welfare Services (CSWS) Office indicated that the staff tried to sell the rice after the election period but sales were slow.
The two-kilo limit per buyer and the distance from far-flung barangays discouraged many potential buyers.
In a formal response to Ouano’s memorandum requesting an explanation, CSWS head Michael Pielago outlined the timeline of the program.
He said the City retrieved the rice from the NFA warehouse in November 2023, launched sales at the City Hall grounds, and later conducted mobile selling in selected barangays.
However, the rice’s poor quality personnel even reported the presence of “worms” shortly after the launch, plus the small purchase limit and an outdated beneficiary list hindered sales.
Pielago said the City was never informed, verbally or in writing, that it would have to pay for unsold rice.
In January 2025, the Provincial Government told the City it would need to settle the remaining stocks, but Mandaue proposed either returning the rice or relaxing the purchase limits to boost sales. Both proposals were declined.
In April 2025, the Province rolled out a new batch of rice for sale at P20 per kilo, but the City’s request to finish selling its old stocks was also rejected. Shortly after, sales were suspended due to the election ban.
“Given the absence of any formal agreement or directive regarding payment for unsold rice, the City did not proceed with payment and continued selling in barangays until the stocks were eventually stored,” Pielago wrote.
The issue also involves a P1-million deficit in payments to the Provincial Government.
Ouano said the City’s initial step is to verify from official records whether the amount was indeed received.
"Kung maayo ang condition sa pag-receive, due gyud na nato nga bayran. Pero akong pangutana, kung naa ba tay contract between the City and the Province, wala man so para dili ma-at loss ang City of Mandaue, ato na lang gyud na e-uli sa province,” he said.
(If the condition upon receipt is good, then we are indeed obliged to pay for it. But my question is, do we have a contract between the City and the Province? We don’t, so to avoid losses for the City of Mandaue, we will just return it to the province.)
The City Treasurer’s Office has so far documented three deposits made in late 2024 totaling P108,560, which covers sales of 47 sacks of rice.
Malig-on said coordination with the Cebu Provincial Government is ongoing to arrange the return of the spoiled rice. (CAV)