Senate, Palace, nears compromise on EO 128– Sotto

On May 3, 2021

Senate President Vicente C. Sotto III leads the continuation of the Committee of the Whole’s (CoW) hybrid hearing on the food security crisis brought about by the severe outbreak of the African swine fever (ASF), Thursday, April 15, 2021 “Today, my esteemed colleagues, the committee invited new resources persons in the hope of being able to answer lingering questions from this representation and the members of the committee. In that way, this committee could provide informed recommendations and craft appropriate legislations to efficiently respond to the ASF problem,” Sotto said (Henzberg Austria/Senate PRIB).

THE legislative and executive branches of government are now working on a “compromise” over Executive Order (EO) 128 to avoid a nasty confrontation when Congress resumes session where it would be compelled to issue a join resolution removing from Pres. Duterte the power to amend the country’s import tariff and volume of allowable imports.

Senate President Vicente Sotto III, in a media interview over the weekend, said thus far, the executive department, thru its economic managers (Department of Finance, NEDA) and the Senate are now “going over the details” of the agreement both sides have been hammering after the Senate held its third ‘Committee of the Whole’ (CoW) hearnng last week regarding the wisdom of EO 128.

Despite opposition from both chambers of Congress, on the representation made by the country’s hog industry, Pres. Duterte last April 7, 2021, signed E0 128, which reduced the import tariff, for one year, of imported pork meat from 30 percent to 5 percent for “in quota” imports and, from 40 percent to 15 percent for “out quota” imports. The reduction was based on the recommendation of the Department of Agriculture (DA), seconded by the Cabinet-level, Committee on Tariff and Related Matters Committee (CTRM).

As soon as Congress took its recess last March 26, 2021, Pres. Duterte, also acting on the recommendation of the DA/CTRM, increased the country’s ‘MAV’ (minimum access volume) for imported pork meat from 54,000 metric tons (MT) to some 404,000 MT.

The Palace decision has dismayed the country’s hog raisers who are already suffering devastations from the African Swine Fever (ASF) since 2018, believing the simultaneous increase in the MAV and the reduction in import tariff may lead to the collapse of the whole industry. Their valid concern prompted them to seek relief from Congress.

Over the last two weeks, the Senate, acting on Resolution 685 filed by Sen. Panfilo Lacson, had conducted three hearings while separate hearings have also been conducted at the House of Representatives as early as February this year.

Should things come to this, it would be the first time in Philippine history that Congress wrested back its delegated power to the executive branch.

Aside from questioning the wisdom of EO 128, Lacson also said that “tongpats” (overprice) for every kilo of imported pork is another prime reason why those at the DA are eager to increase the MAV and bring down the import tariff.

Avoiding a nasty confrontation

Sotto said that so far, the executive branch had agreed to scale down the volume of import to almost half of the 404,000 MT approved by Pres. Duterte but would not agree to increase the import tariff under EO 128, as demanded by the hog industry.

In a presentation before lawmakers, finance secretary Carlos Dominguez, also a former agriculture secretary, claim increasing the import tariff would push up “inflation.”

Dominguez, however, did not explain how they (country’s economic managers) managed to tame inflation in the years when the country’s pork import duty is being assessed at 30 and 40 percent.

“… Sa minimum access volume, payag sila pero 254,000 (metric tons) sa computation nila, imbis na 200,000.

“Pero yung 20 at 15 (import tariff increase) medyo meron silang ibang pananaw… pag-uusapan namin sa Lunes,” Sotto said.

Sotto is referring to the Senate’s scheduled caucus this Monday, May 3, 2021, on the result of the COW hearings and what action they should take next, including the content of the committee report.

Should no compromise be reached, Sotto had previously warned that both chambers of Congress may issue a “joint resolution” recalling the President’s power to modify the country’s import tariff and volume of imports, as such is just a “delegated power” of Congress to the Philippine President. Congress is to resume its session on May 17, 2021 and Sotto said this is the situation that he wants to avoid.

Should things come to this, it would be the first time in Philippine history that Congress wrested back its delegated power to the executive branch.

Last April 13, 2021, a day after the COW held its first public hearing, presidential spokesman Harry Roque said that while the Palace recognized that the Senate is correct in pointing out that all powers on taxation resides on Congress, Pres. Duterte also has the prerogative to veto, in whole or in part, any proposal coming from Congress.

“Congress may, by law, impose limitations on such delegated power or may reverse the same,” Roque said.

“(But) should Congress pass another bill changing the tariff on imported pork, the President may veto any particular item or items in such appropriation, revenue, or tariff bill,” Roque retorted.