The National Food Authority (NFA) said yesterday the P5.1 billion subsidy granted to the agency in 2017 was fully utilized for the procurement of grains like palay, corn and imported rice.

The agency said the procurement was done to ensure ample buffer stocks as it vehemently denied accusations it diverted food security funds for other purposes.

It noted that the Commission on Audit (CoA) yearend report for 2017 made no mention of NFA funds diverted as alleged in a news report.

That report said CoA called out the NFA for “diverting the P5.1 billion subsidy meant to ensure food security to pay off its maturing loans last year.”

The report being contested by NFA claimed the alleged diversion could have hampered the agency’s ability to maintain a stable rice supply.

NFA came short of calling the report fake news. It clarified it received the P5.1 billion government subsidy from the Department of Budget and Management (DBM) on 24 February 2017.

The Bureau of Treasury (BTr) automatically deducted 10 percent or P510 million as payment for the previous years’ guarantee fee, NFA said.

It added that P2.5 billion of the amount represented payment of annual contribution to the P8 billion worth of 10-year Treasury Bonds issued to the NFA in February 2008.

Out of the total subsidy, the NFA claimed it only received net proceeds of only P2.090 billion. The agency stressed it operates under a “One Fund Concept” in managing its finances.

Under the scheme, all funds and revenues accrue to one “General Fund” from where all expenditures are sourced.

The agency pointed out that it was even commended by CoA during the exit conference for its “prudent management of funds resulting in lower losses and timely settlement of its financial obligations.”