Senators back probe on pork ‘tongpats’ as tariff cuts resolution OK’d
THE Senate on Monday adopted a resolution asking President Duterte to declare a state of national emergency due to the African Swine Fever (ASF) and rejecting twin proposals to slash pork tariffs while increasing the minimum access volume (MAV) for pork imports.
This developed as senators moved for an inquiry into the possibility that vested interest groups may be making a killing from the importation of meat products while the government loses billions in foregone revenue from smuggling and corruption.
Senator Panfilo Lacson moved to open the inquiry while senators were deliberating two draft Senate resolutions, both intended to ask Duterte to reject a proposal, endorsed by the Department of Agriculture, to bring down tariffs while increasing the MAV.
The proposals were a response to the inflationary impact of pork supply shortages and resulting price spikes as the ASF continues to ravage the local hog sector.
On Monday night, senators approved Senate Resolution 676 in consideration of Senate Resolution 684 authored by Senators Cynthia Villar and Francis Pangilinan. Villar chairs the chamber’s agriculture committee while Pangilinan is a former presidential adviser on food security.
The senators on Wednesday last week had agreed to fast-track the resolution expressing the sense of the Senate, on top of a letter sent earlier to Malacañang by Villar and Sen. Imee Marcos, asking the President to reject the proposal for lower tariffs.
They echoed concerns raised earlier by Villar and Marcos that slashing tariffs—on top of a move to increase MAV—is unnecessary and would kill the local hog industry. This, without substantially addressing the concern of inflation caused by the shortage of pork supply.
“We should not bring down tariffs; the local hog industry is already reeling (bugbog na)” from the crisis spawned by the ASF and the series of typhoons late last year, Majority Leader Miguel Zubiri said.
‘Tongpats’ system?
This developed as senators are now keen on investigating the alleged “tongpats” system prevailing in the country’s meat importation system, wherein unscrupulous government officials connive with importers for kickbacks for every kilogram of pork imported.
Lacson disclosed at Monday’s plenary session that he has received information from “highly placed officials” that certain DA officials are getting P5 to P7 per kilogram of pork imported.
Lacson pointed out that this is happening at the present tariff regime and could double to P10 to P15 if the Executive proceeds to reduce tariff rates to as low as 5 percent.
Lacson’s disclosure was adopted by the Senate as an amendment to Senate Resolutions 676 and 684 that seek to block the twin proposals to slash tariffs while hiking MAV.
The Senate also adopted Lacson’s amendment urging the Presidential Anti-Corruption Commission (PACC) to conduct a motu proprio investigation regarding the “allegations that certain unscrupulous individuals connive for scheme of tongpats.”
Lacson added that he will also file a separate Senate resolution that would initiate an inquiry regarding the alleged P5 to P7 per kg “tongpats” system for the importation of products under MAV.
“Kaya siguro nagpipilit na ibaba ang tariff at itaas iyong volume dahil baka mayroong lobbying all the way from the back [Maybe that’s why there’s a strong push for tariff reductions and increase of MAV, because there’s lobbying all the way from the back],” he said.
Lacson noted that should the “tongpats” rise to P10 to P15 per kilogram, then the thieving officials would earn a clear P4 billion to P6 billion from the proposed 400,000 metric tons (MT) of pork MAV.
Technical smuggling
The issue of technical smuggling of pork imports was also raised during the plenary session, with senators pointing out that unscrupulous importers are already benefitting from misdeclaring good, or prime, pork cuts as pork offal to avert paying higher tariffs.
“Aside from adopting a resolution, maybe it is proper also for the Senate as a Committee of the Whole to conduct an investigation regarding the misdeclaration of imports in the middle of the pandemic,” Lacson said.
Pangilinan also proposed that the Senate look into the profiles of meat importers to determine if they really have the capacity to import meat products.
‘Transparent’ system
Sought for comment, Meat Importers and Traders Association (Mita) President Jesus C. Cham said the country’s MAV system is an “established, robust system” that is “very transparent and equitable.”
“The reason I say that [is] because this was established in 1996 and survived for 21 years without controversies,” Cham told the BusinessMirror, noting that there are more than 100 companies and firms eligible to import under the present MAV for pork.
Cham explained that the MAV is allocated among eligible importers, firms and companies based on their past MAV performances, whether they are able to use up all their allocations or not.
“If you hit your performance target, then you keep your previous allocation and entitled for an additional allocation,” he said.
Eligible licensees for additional allocation partake in the beginning year pool, wherein surrendered and available unused quota are raffled among themselves.
Cham, who sits in the MAV Council and whose company has a MAV allocation, said he is not aware of any “tongpats” system in the current MAV setup.
Cham also disclosed that the MAV Council has not finalized the details for the allocation and implementation of the proposed additional MAV by the executive branch.
“The details have not been finalized but the consensus was that it should be opened to practically anybody—any qualified meat importer, that is, someone who is accredited with the Customs as an importer and registered with the National Meat Inspection Service as a meat importer,” he said.