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Disaster compensation deemed higher priority than farmer pension fund

THE GOVERNMENT needs to establish a system for compensating farmers for losses incurred in the wake of natural disasters, before working on a pension fund for agricultural workers, analysts said.

“The (pension) idea is good, but our farmers struggle to get at least basic indemnification during animal diseases or calamities,” Jayson H. Cainglet, executive director of Samahang Industriya ng Agrikultura, told BusinessWorld by phone.

“We should first provide the basic (needs) before we propose something like that. Insurance and indemnification — that is what the farmers need to get,” he said.

Mr. Cainglet said that poultry and livestock sectors still do not have a proper indemnification system for their losses during outbreaks of animal disease, with farmers struggling to afford insurance.

Bicol Saro Party-list Representative Brian Raymund S. Yamsuan and Camarines Sur Rep. Luis Raymund F. Villafuerte filed House Bill 7963, which seeks to establish an Agricultural Pension Fund (APF) to be managed by the Philippine Crop Insurance Corp. (PCIC).

The measure proposes to provide pensions to nearly 10 million small farmers and fisherfolk.

Under the bill, the PCIC, a unit of the Department of Agriculture (DA), will create the pension plan, manage and invest it, and set the eligibility rules.

“Farmers are considered by the International Labor Organization as self-employed rural workers. Their employer is society in general, represented by the government, because they produce food for the population,” according to Raul Q. Montemayor, national manager of Federation of Free Farmers.

“So, the idea of providing them a pension after working long years to feed society is worth considering,” he told BusinessWorld in a Viber message.

Mr. Montemayor said that the APF would be better off being integrated with other benefit systems such as PhilHealth and the Social Security System. “They can receive not only pensions but also healthcare, employment compensation and other benefits enjoyed by regular workers/employees.”

“The main problem here is that, while the ‘employers’ share in premiums could possibly be borne by the government, how will farmers pay their premiums regularly if their incomes are seasonal, small, and susceptible to calamities and other risks?” Mr. Montemayor said.

According to the bill, funding for the pension system will be included in the DA’s budget.

Meanwhile, Sonny A. Africa, executive director of think tank Ibon Foundation, recommended a tax-financed universal pension fund open to every citizen.

“Such a scheme is necessarily tax-financed from the government’s general fund because a contribution-based scheme or one financed by specific funds for specific sectors will be discriminatory because different social and economic groups have different capacities to pay contributions,” he said in a Viber message.

Mr. Africa called the sector-specific pension scheme “administratively cumbersome,” adding that “every citizen deserves a pension in their old age as a matter of right.”

“This proposal is not just discriminatory but also involves unnecessary administrative expenses in identifying qualified beneficiaries. For instance, many rural producers irregularly shift between farming or fishing and a vast range of informal non-farm service work. Who is qualified and under what condition?,” he said.

Mr. Africa said some countries in Southeast Asia have universal pension schemes including Timor-Leste, Brunei, Vietnam, and Thailand. — Sheldeen Joy Talavera

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