SONA 2022

The promise – and limits – of Marcos’ SONA push to write off agrarian reform beneficiaries’ debt

Pia Ranada

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The promise – and limits – of Marcos’ SONA push to write off agrarian reform beneficiaries’ debt

FOOD SECURITY AND LAND TENURE. In this file photo, farmers walk through a rice field. Rappler

Progressive groups say the policy is 'long overdue,' but they also point to limitations if other measures aren't pursued. Will condoning the debt lead to farmers selling their agricultural land and more rapid conversion of the land to other uses?

MANILA, Philippines – One of President Ferdinand Marcos Jr.’s first legislative asks from Congress in his first State of the Nation Address (SONA) is a law that would free from debt farmers awarded lands by the government.

Progressive groups welcomed the policy direction, saying it should have been done long ago, but they also pointed out the limits of Marcos’ agrarian reform declarations.

Without a ban on land conversion, would the policy hasten the shrinking of agricultural lands by making it easier for agrarian reform beneficiaries to sell their land to entities who want to use the land for commercial, residential, or industrial purposes?

“Congress must also pass a law that will emancipate the agrarian reform beneficiaries from the agrarian reform debt burden, thereby amending Section 26 of Republic Act 6657,” said Marcos on Monday, July 25, referring to the Comprehensive Agrarian Reform Law.

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FULL TEXT: President Marcos’ State of the Nation Address 2022

FULL TEXT: President Marcos’ State of the Nation Address 2022

“In this law, the loans of agrarian reform beneficiaries with unpaid amortization and interest shall be condoned,” he added.

As for agrarian reform beneficiaries who are yet to receive land under the Comprehensive Agrarian Reform Program (CARP), they will also be given the land sans any obligation to pay amortization, said the President. This amounts to free land distribution, something that progressive farmers’ groups have been asking for for decades.

The condonation of the loans would involve P58 billion and benefit 654,000 agrarian reform beneficiaries, said Marcos. It would cover 1.18 million hectares of awarded lands.

His eldest sister, Senator Imee Marcos, had also called for the writing off of unpaid loans in 2020 as a response to the COVID-19 pandemic. She said back then that doing so would help farmers gain access to better loans, thus helping them make their lands more productive.

“Condoning unpaid loans will give farmers fresh access to other government lending programs that will help them maintain, if not increase, their productivity amid the pandemic,” she said then.

But while Congress is yet to pass the wish list law, President Marcos said he would go ahead and impose a one-year moratorium on agrarian reform beneficiaries’ payments of land amortization and interest.

Such a moratorium had been implemented by the Duterte administration in light of the COVID-19 pandemic and was one poverty-alleviating measure included in the Bayanihan to Heal as One Act.

“A moratorium will give the farmers the ability to channel their resources in developing their farms, maximizing their capacity to produce, and propel the growth of our economy,” said Marcos.

Limits of Marcos’ declarations

The progressive group Kilusang Mambubukid ng Pilipinas (KMP), led by Duterte-time agrarian reform secretary Rafael Mariano, said the push for a debt condonation law and free land distribution was “long overdue.” But passing such a law is not enough.

Free land distribution would cover only lands already acquired by the government from private entities, or government lands intended for or suitable for agriculture under a Duterte executive order. Because the CARP expired in 2014, the government no longer has the mandate to cover additional agricultural lands still in private hands.

“The intent to distribute lands free of charge is ineffective at best and duplicitous at worst, in the absence of a new agrarian reform law that will allow the coverage of new private agricultural lands for distribution after CARP’s mandate to do so expired in 2014,” said Mariano.

To KMP, Marcos is “absolving” private entities that would be free to acquire lands from agrarian reform beneficiaries, whether by buying it from them or taking the land by force.

If Marcos was sincere in giving more lands to landless farmers, said Mariano, he would push for a new law that would extend government’s mandate to acquire more privately held agricultural lands and would impose a moratorium on land conversion.

This halt in land conversion would address the problem of agrarian reform beneficiaries giving their land to private firms, which would then turn the agricultural land into subdivisions or commercial developments.

“The non-recognition of the problem of land use conversion defeats any declared support for agrarian reform. Without this, any farmer awarded any land faces the danger of eviction and conversion,” said Mariano.

Jobert Pahilga, a lawyer with paralegal group Sentra, hopes Marcos “will be true to his words.”

But he echoed Mariano that there are more problems with the agrarian reform program that Marcos left unmentioned.

“Condonation of debt would not be enough. The government should make an inventory of the lands awarded through [Presidential Decree] 27 and CARP as, at present, the farmer-beneficiaries are not in control and possession of the lands like in the case of Hacienda Tinang. The land awarded to farmers should be given back to them,” he said.

In Hacienda Tinang in Tarlac, farmer-beneficiaries of land have still not been able to possess and benefit from the awarded land because of contestations and disputes with another group, which includes Concepcion, Tarlac Mayor Noel Villanueva.

Beneficiaries selling their land

However, debt condonation could also be a policy that makes it easier for agrarian reform beneficiaries to sell their awarded land. According to the law, a land beneficiary can sell their landholding after 10 years.

Economist Raul Fabella, in a Business World column, had seen debt condonation as a type of economic stimulus measure. It would mean farmers would finally fully own the land and would be able to sell or lease their land for industrial-scale farming.

Fabella pointed to studies showing that consolidated tracts of agricultural land are much more productive and income-generating than if they were tilled piecemeal by smallholder farmers with limited capital.

“The beneficiaries become renters on top of having more stable employment in large farms,” said Fabella.

But if farmers can easily sell their land to any private entity, there’s little stopping that private entity from converting the supposedly agricultural land for other purposes – unless Marcos also imposes a ban on land conversion. This would ensure that the landholding would be used for agricultural purposes. Without this ban, and with farmers free to sell their land, the country could see a shrinking of lands planted with crops, which is a threat to food security.

This would be ironic, given Marcos’ repeated promises to prioritize food security and food affordability.

But Marcos’ call on Congress to finally pass a National Land Use Act could be related. Versions of this measure, which has been languishing in the legislative chambers for two decades, intend to create a National Land Use Plan that would set aside specific areas in the country for agriculture and fisheries, conservation, residential development, and infrastructure.

But Mariano worries about versions of the National Land Use Act that would exclude agricultural lands.

Status of agrarian reform

Under CARP, the government targeted to acquire and distribute 5.4 million hectares of land for landless farmers and farm workers. Of this, around 4.9 million hectares have been distributed.

This means a balance of over 540,000 undistributed lands as of the end of the Duterte administration, according to former agrarian reform secretary John Castriciones in an August 2021 briefing with Duterte. Distributing land to landless farmers is a government policy aimed at social justice and empowering farmers who, as new land owners, would have the chance to independently make their own living from the land rather than be at the mercy of landowners.

But without support, farmers lacking money have often been unable to put up the capital needed to make their land productive and end up selling their land or giving its control back to previous landowners. This is why, as Marcos himself acknowledged in his SONA, agrarian reform programs must also provide production support to the beneficiaries in the form of fertilizer, machines, pesticides and herbicides, and more.

Land for agriculture graduates

In 2019, then president Rodrigo Duterte issued an executive order hoping to add certain government lands to lands for distribution – government lands that have been devoted to or are suitable for agriculture and have not been used for the purpose they were bought.

According to Marcos, there are 52,000 hectares of such land that he aims to distribute to landless war veterans, landless surviving spouse and orphans of war veterans, and landless military and police retirees.

These lands will also be given to landless persons with college degrees in agriculture.

“The call of the times is for the infusion of fresh and new blood in the agricultural sector. We need a new breed of farmers equipped with modern agricultural technology able to engage in sustained scientific farming that will not only increase farm yields but also resilience in the face of climate change,” said Marcos in his SONA.

The policy promises to address one long-festering problem in the country’s agriculture: the aging of farmers and a dearth of young people willing to work in the sector.

By giving land to young people interested in agriculture, Marcos appears bent on giving them a leg-up so they won’t need to start from scratch.

Many will no doubt be waiting for how and when Marcos will operationalize the directive. How can agriculture graduates sign up for free land? What conditions or qualifications apart from the degree will be imposed, if any? – Rappler.com

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Pia Ranada

Pia Ranada is Rappler’s Community Lead, in charge of linking our journalism with communities for impact.