PRIMER ON CARP EXTENSION

I. CARP in Retrospect

1. When was the Comprehensive Agrarian Reform Program (CARP) instituted?

TheComprehensive AgrarianReform Program (CARP)was instituted on June10, 1988. Touted as the centerpiece program of President Corazon Aquinos administration, it was considered the most comprehensive of all the redistributive programs established by past administrations. Its enabling law, Republic Act 6657, aimed not only to grant land to the tillers, but also to provide them with the necessary support services that would ensure the productivity of the landgiven to them under the law.

Among the various land reform laws that have been enacted by various administrations, from the Commonwealth government to the administration of the late President Ferdinand Marcos, only the Comprehensive Agrarian Reform Law (CARL) has the mandate of the Constitution.

Section 21 of Article II or the Declaration of Principles and State Policies asserts, "the State shall promote comprehensive rural development and agrarian reform." The National Economy and Patrimony Article (XXII), in Section 1, par. 2 reiterates, "the State shall promote industrialization and full employment based on sound agricultural development and agrarian reform." Meanwhile, Article XIII, or the Social Justice and Human Rights article provides for "Agrarian and Natural Resources Reform."

2. What lands does the program cover?

Scope

The Comprehensive Agrarian Reform Law covers, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands as provided in Proclamation No. 131 and Executive Order 229, including other lands of the public domain suitable for agriculture.

Of the 8.1 million hectare-revised CARP scope, the Department of Agrarian Reform (DAR) is tasked to distribute 4.3 million hectares. The Department of Environment and Natural Resources (DENR), on the other hand, is tasked with the distribution of 3.8 million hectares.

Schedule of implementation

The distribution of all lands shall be implemented immediately and completed within ten years from the effectivity of the law.

Retention limits

Under RA 6657, the landowner retains a maximum of five hectares. Three hectares is awarded to each child of the landowner provided that he/she is at least fifteen years of age, and that he/she is actually tilling the land or directly managing the farm. The landowner has the right to choose which area to retain. In case the retained area is tenanted, the tenant may choose to remain in the retained area and be a leaseholder, or be a tenant in another agricultural land. The tenant is given one year to exercise his option from the time the landowner chooses the area for retention. Landowners covered by Presidential Decree 27 are allowed to keep their retained lands under the law.

3. What are other executive orders and amendments that have a bearing on CARP?

Section 20, Executive Order 229

The Agrarian Reform Fund is created as provided for in Proclamation No. 131 dated 22 July 1987. It is a special fund amounting to FIFTY BILLION PESOS to cover the estimated cost of CARP from 1987 to 1992. The sources of the fund are the proceeds from the sale of the assets of the Asset Privatization Trust (APT), the sale of ill-gotten wealth recovered through the Presidential Commission on Good Government (PCGG), and other sources that government may deem appropriate. The amount collected and accrued to the Agrarian Reform Fund is considered automatically appropriated for the purpose authorized in EO 229.

Republic Act 8532

RA 8532 amends Section 63 of the CARL and legislates an additional FIFTY BILLION PESOS for the CARLs implementation until 2008. In addition to the sources of funds identified in Section 20 of EO 229, RA 8532 also appropriates not less than three billion pesos from the General Appropriations Act (GAA).

However, the Department of Justice Opinion No. 9 of 1997 adds that "the ten-year implementation period should be regarded as directory and not mandatory." This means that the period for implementation set under both Acts should be regarded as mere target periods within which the implementation of the program should be completed. This does not indicate the end of the program itself.

II. Status of CARP Implementation

4. What has been accomplished so far?

According to land distribution accomplishment figures in December 2005, the DAR has already distributed 3.65 million hectares out of the 4.3 million revised scope. The DENR, on the other hand, has already distributed 2.93 million hectares out of its target of 3.8 million hectares. Therefore, the remaining balance for CARP stands at 1.52 million hectares. However, according to the DARs Inventory of CARP Scope balance in October 2006, the total area of landholdings in the balance is actually 1.9 million

hectares. This means that the DAR balance is 0.38 million hectares more than the December 2005 figures.

5. How have Agrarian Reform Beneficiaries (ARBs) benefited from CARP implementation?

The economic conditions of the Agrarian Reform Beneficiaries (ARBs) have improved because of CARP. An assessment of the impact of the United Nations Development Programme-funded Support to Agrarian Reform and Indigenous Communities (UNDPSARDIC) showed that the average annual income of ARBs is more than twice that of non-ARBs1. In the same vein, the value of the assets of ARBs is double that of nonARBs2. "ARBs were also more satisfied about their economic conditions and perceived that their general well-being improved compared to non-ARBs."

Under the Agrarian Reform Communities Development Project (ARCDP), six communities proved that "Land Tenure Improvement (LTI), coupled with proper intervention, resulted in significant positive effects particularly on the farmerbeneficiaries."3 The follow-up study to the ARCDP also showed that the value of output per hectare was higher among ARBs in 56 ARCDP sites. Moreover, in attributes like farm income, off-farm income, and total income, the same study showed a positive effect on the respondents.4

6. What are the issues and problems weighing down on CARP implementation?

Lack of funding

Based on the actual funding requirement estimated by the Presidential Agrarian Reform Council (PARC) in 1987, the CARP needed 221.09 billion to ensure its full implementation for ten years. However, only 100 billion has been appropriated under the law, resulting to a funding gap of 121.09 billion.

Lack of support services

The lack of support services for Agrarian Reform Beneficiaries (ARBs) means that the CARP is unable to fulfill its mandate of ensuring the productivity of the lands that are distributed to farmers. Owing largely to the funding constraints for program beneficiaries development, the Department of Agrarian Reform (DAR) instituted the formation of Agrarian Reform Centers (ARCs) in 1993. The ARCs were initiated in areas where there was a "critical mass of farmers and farm workers awaiting full implementation of agrarian reform," and were meant to serve as "focal points of agricultural development." This means that the delivery of support services was concentrated on ARCs.

By end 1998, DAR was expected to have established 2,000 more ARCs. In December 2004, DAR had identified 1,614 ARCs; 886 or 55 percent of which received various forms of support from donor countries5. Agrarian Reform Communities, however, are still classified according to those that have Foreign Assisted Funding (FAP), and those that only get limited local funding support, or non-FAP ARCs. Naturally, the non-FAP ARCs received less assistance than those received by the former. However, if CARP is to deliver on its promise of redistributing lands to the landless and ensuring farmland productivity, the rest of the ARB population has to benefit from program beneficiaries development.

Second-generation problems

The following issues and problems are generally referred to by agrarian reform advocates as second-generation problems because they are encountered by agrarian reform beneficiaries that have already been awarded lands under the program.

Cancellation of EPs/CLOAs

The cancellation of Emancipation Patents (EPs) and Certificates of Land Ownership Awards (CLOAs) is a continuing problem for CARP implementers and beneficiaries alike. Whereas EPs and CLOAs are legal titles that should strengthen the claim of beneficiaries over their lands, these could still be cancelled when landowners start to question DAR personnels technical lapses in designating lands for CARP coverage. There have also been cases where landowners exercise their right to their retention

areas years after the beneficiaries are already in place and have been issued EPs and CLOAs. These, too, have led to cancellations.

In 1994, the DAR has also issued an administrative order (AO) detailing the grounds for the cancellation of EPs and CLOAs. The AO caused confusion among beneficiaries, as they were unaware of such a policy.

In 1996, DAR issued Administrative Order No. 3 which aims to minimize the damage caused by cancellations on beneficiaries by providing them with a relocation fund, or refund of the amortization they have paid, but this does not even begin to approximate the loss the beneficiaries suffer when their EPs and CLOAs are cancelled.

Lack of safeguards for EP and CLOA holders

The system of registering lands in the Philippines is governed by the Torrens system. It is defined as "the system whereby all real estate ownership may be judicially confirmed and recorded in the archives of government." Another definition states that it is "a system of registration wherein documents are closely regulated, monitored and examined to ensure the title is transferred without flaw. This also ensures that ones title to property is indefeasible and incontestable." Sadly, however, this safeguard is not accorded to holders of EPs and CLOAs. These could still be cancelled in accordance with the various administrative orders that DAR has issued. Worse, there is no set prescriptive period for hearing petitions for EP and CLOA cancellations.

Landowner resistance

Landowner resistance is most often the reason cited by CARP implementers when they try to explain poor implementation of the program. This is the reason why private agricultural lands remain undistributed. Even when the DAR posted the highest land distribution accomplishment during the term of President Fidel Ramos, this was due more to government-owned lands being distributed than anything else. In most cases, landowners refuse to accept the land valuation formulated by the Presidential Agrarian Reform Council or PARC. Hence, even when the Land Bank of the Philippines (LBP)

has funds for landowner compensation, these remain with the bank and serve as another cause for the non-implementation of CARP. Landowners have also resorted to filing cases against DAR personnel, and against beneficiaries in regular courts or the special agrarian courts. With the issuance of Temporary Restraining Orders (TRO) by these courts, the implementation of the program is effectively delayed.

Agrarian justice

Even though the Supreme Court has already ruled that TROs cannot be issued against DAR in its exercise of its duties, this does not seem to translate to a more aggressive implementation at the local level. The past decisions of the Court of Appeals and the Supreme Court on agrarian-related cases (for instance, the Sumilao and Sumalo cases), which favored landowners, do not exactly encourage DAR personnel to be more vigorous in implementing CARP.

III. The Question of CARP Funding

7. How can we address these problems?

The first crucial step in addressing problems encountered in the course of CARP implementation is to extend funding for the program. Fund allocation for CARP is scheduled to end by June 2008 as stated in RA 8532. As in most laws, funding will ensure the programs full implementation until it is completed. Without the necessary funding, there is hardly any hope for finishing what CARP has started.

More importantly, social justice is at the heart of agrarian reform. RA 6657 was enacted to address the inequitable distribution of wealth in the countryside. It sought to enable landless farmers to own their lands and make these productive. Based on CARP distribution figures cited, 81 percent of the lands covered under CARP have already been distributed. But there is still a substantial number that remains untouched by agrarian reform. In fact, figures could even be higher. Also, support services remain concentrated among ARCs; more need to be established in order to spread the benefits of program beneficiaries development. There are also problems that continue to

impede CARP progress (i.e. second generation problems). These, too, need to be addressed. All these will entail funding.

CARP is not just about social justice. It is also about achieving economic development in the countryside. It is, therefore, imperative to ensure its continued implementation so that national development wont be long in coming.

8. Would extending the funds for CARP answer all the problems regarding CARP implementation?

No. While advocating for the extension of CARP funding is necessary, it is also crucial that issues or controversies hounding CARP implementing agencies are investigated, and misconduct, prosecuted.

IV. CARP Impact Validation

9. Shouldnt an impact validation of CARP be done before extending the fund?

Not necessarily. It is clear that the program has not yet been completed and funds are needed to ensure that its targets and outcomes are met.

At the same time, there is an urgent need for the validation of the impact of CARP since the start of its implementation. A validation of CARPs impact would serve as a truthful assessment of the amount of time it would take to accomplish CARPs remaining balance. It could also show to CARP implementing agencies the best strategies to employ in order for them to fulfill their mandate. But, more importantly, it could help legislators gauge the amount of funds that needs to be allocated for the completion of the program.

10. Which bills were filed on the extension of CARP funding?

During the 13th Congress, two bills were filed by Representative Abraham Kahlil B. Mitra and Akbayan Party-List Representative Ana Theresia Hontiveros-Baraquel that seek to extend CARP funding and address some of the problems associated with CARP implementation.

11. What are the general features of the bills?

Both bills seek to extend the funding for CARP.

The Mitra bill seeks a P50 billion increase in funding until 2013, and increases the P3 billion yearly appropriation from the General Appropriations Act (GAA) to P5 billion. It also specifies the establishment of three ARCs per year. Corollary to this provision is the 50 percent allocation of agrarian reform funds for Program Beneficiaries Development. To ensure CARP sustainability, it provides for the creation of an Oversight Committee composed of 3 representatives each from the Senate, the House of Representatives, the DAR, DA and the DENR. The committee is to meet once a year to assess CARP implementation, and is required to submit its evaluation to both the Senate and the HOR.

On the other hand, the Hontiveros-Baraquel bill proposes a P100 billion increase in funding. It does not impose a time limitation for the fund. Instead, it states that resources should be provided until the completion of the Programs implementation. It mandates an automatic appropriation equivalent to no less than 1.6 percent of the total national budget of every year beginning in 2008. It also provides that 70 percent of the funds should be allocated to land acquisition, distribution and compensation. Once that is accomplished, funds shall be wholly appropriated to support services.

The Hontiveros-Baraquel bill also tries to address loopholes in the law that serve as stumbling blocks to the just and speedy implementation of the program.

V. Achieving Human Development through Agrarian Reform

12. How can we achieve human development through the just implementation of CARP?

PLCPD believes that human beings should be at the center of development.

Dr. Mahbub ul Haq, a Pakistani economist and one of the founders of the human development theory, defines human development in the following paragraph:

"The basic purpose of development is to enlarge peoples choices. In principle, these choices can be infinite and can change over time. People often value achievements that do not show up at all, or not immediately, in income or growth figures: greater access to knowledge, better nutrition and health services, more secure livelihoods, security against crime and physical violence, satisfying leisure hours, political and cultural freedoms, and sense of participation in community activities. The objective of development is to create an enabling environment for people to enjoy long, healthy and creative lives."6

Building human capabilities is fundamental in enlarging peoples choices. These include being able to "lead long and healthy lives, to be knowledgeable, to have access to the resources needed for a decent standard of living, and to be able to participate in the life of the community."7

Such is the ultimate goal of agrarian reform, and, in a way, the preceding laws before it. However, these were mostly flawed, and stopped short of institutionalizing farmers ability to access crucial resources through support services.

It was only the Comprehensive Agrarian Reform Law that provided measures that would empower the millions of landless farmers by providing them the means to make their lands productive and alleviate their quality of life and that of their families.

Why CARP Extension With Reforms in 2008? A Primer

Posted Sun, 08/17/2008 - 17:32 by Publication This primer is issued by AR Now!, PAKISAMA, PESANTech and PhilDHRRA to present and explain the extension with reforms position with regards to the impending expiration of CARP in June 2008. This primer will also attempt to clarify certain misconceptions about the event that will transpire in June 2008 and about the extension with reforms position.

Q: Exactly what will transpire in June 2008?

A: A common misconception is that it is CARP, the program, that will expire in June 2008. However, a Department of Justice Opinion (DOJ Opinion No. 9, series of 1997) already long established that CARP is a continuing program and does not end until its original scope and mandate has been completed. Part of that scope and mandate is its LAD target which, by far, still has a backlog of 1.3 million hectares (ICS, as of December 2006).

Actually, what will expire next year is Republic Act 8532, which amended Republic Act 6657, or the Comprehensive Agrarian Reform Law (CARL), to extend and replenish (with another P50 billion) the Agrarian Reform Fund (ARF).

So, technically (and legally), what will expire in June 2008 is not CARP per se but funding for the program.

Q: What will be the implications if there is no law passed on CARP funding by June 2008?

A: The Department of Budget and Management (DBM), in several public round table discussions and fora, have expressed the opinion that without a new law extending and, again, replenishing the ARF (according to the Presidential Agrarian Reform Council [PARC], the PhP 100 billion that RA 6657 and RA 8532 appropriated for CARP has already been used up as of 2005) would mean that there will be no legal basis for government to allocate and release funds for the program.

In effect, CARP as program will continue but will have no budget, at least, until a new law appropriating funds to the ARF is passed.

Operationally, this would be tantamount to no program as there would be no funds for land acquisition and distribution, for salaries of DAR officials and employees, operational costs, etc..

A major concern is that once the implementation of the program is stopped, even temporarily, it would be very difficult to get the program re-started.

Q: What then happens to the lands not yet acquired under CARP?

A: The opinion is that uncompleted land claims under CARP will be done through judicial expropriation. Which will be highly problematic and disadvantageous for agrarian reform beneficiaries (ARBs) as most farmers will not have the financial capacity to initiate and sustain legal cases before the courts. There have also been decisions by the Supreme Court wherein ARBs were not recognized as parties of interest to agrarian cases.

Q: How will this affect farmers and potential beneficiaries of CARP?

A: The non-implementation of CARP resulting from the expiration of the programs budget will affect an estimated 700,000 potential ARBs (the estimate is based on the DARs projection that there will still be some 1,077,538 hectares of CARPable lands after 2008 and the current ratio of 1.5 hectares per ARB) and potentially another 1 million ARBs under the leasehold arrangement. That is, said ARBs would be deprived of the opportunity to be awarded lands under the program or the opportunity for ARBs in retention areas to enter into leasehold arrangements (an arrangement generally considered more favorable for farmers than the traditional share-tenancy arrangement) with landowners.

Discontinuance of the program will also result in lesser support services delivery to farmers and ARBs.

Q: What are the proposals to address the impending expiration of CARP funding in June

2008?

A: Basically, the solution to the issue at hand is the immediate passage by Congress of a law providing funds for the CARP. Although, this is not as simple as it seems. Considering the composition of Congress and the diverse positions of peasant and AR groups on CARP.

However, there are mainly four positions/proposals on the expiration of CARP funding in 2008:

1. Scrap CARP/Allow CARP to expire and pass a new law Some peasant and AR groups have reached the conclusion that CARP has failed and should be scrapped altogether or just be allowed to expire and then campaign for the passage of a totally new law (usually in reference to a genuine agrarian reform law which is based on the principles zero retention and zero compensation/free land distribution). Ironically, anti-AR/landlord groups also share the scrap CARP position with some militant peasant groups.

2. Review before extension This is also a position shared by anti-AR/landlord groups and certain militant peasant groups. This is mostly a delaying tactics position as the review will obviously take time and will lead to a possible scenario wherein RA 8532 expires by June 2008 with the review still unfinished and, subsequently, the extension law still not passed. In effect, scrapping CARP by virtue of a default.

3. Short bill/mere extension Considering the short period left for the passage of a new CARP budget law, a group has also taken the position that the law the law that should be passed is a short bill, which would be very similar to RA 8532, simply containing an extension period for the ARF and the replenishment of the ARF with a specific amount. The group has proposed a 5-year extension and the appropriation of another P50 billion for the ARF. The said proposal, however, provides very little opportunity to introduce much needed policy reforms to address major CARP implementation issues. The proposal also serves as a strategy for buying time for the passage of a new law. The only problem will this is that will Congress pass two legislations on CARP in succession and in such a short time.

The idea is to just get CARP implementation extended (lets say for 5 years) and within the extension period launch a campaign for the passage of a totally new law/genuine agrarian reform law.

4. Extension with reforms bill The authors of this primer and several other peasant and AR groups have taken this approach in addressing the extension issue. The said position basically calls for the enactment of a law that would allow the continuation of CARP through the provision of adequate funds but also introduces major amendments (reforms) to RA 6657 to address several operational issues of said program. (For details on said position please refer to the next section)

Q: What is the CARP Extension with Reforms bill (main features and the common misconceptions about it)?

A: The so-called proposed extension with reforms bill is actually not an extension bill as it does not propose that the implementation of CARP be extended for a certain period (i.e. 5, 7 or 10 years are the current proposals) after which CARP ends.

Rather, what the extension with reforms bill is proposing is that funding for CARP be provided through automatic appropriations by Congress. The proposed annual budget for CARP under the bill is set at 3.8 per cent of the annual budget of government or around PhP 38 billion per year.

And instead of an extension period, what is proposed is that the DAR should be given a deadline to finish the LAD component of CARP. The bill is proposing a 7-year deadline for the completion of DAR LAD targets.

The bill also proposes several amendments to CARP to address various implementation and policy issues. Among them are the proposed provisions on the indefeasibility of CLOAs and the repeal of non-distributive schemes under CARP (i.e. VLT/DPS, SDO, leaseback, etc.).

Q: Why should CARP implementation continue?

A: CARP implementation should continue because there remains a substantial amount of unfinished business for CARP.

According to DAR estimates, there will still be some 1,077,538 hectares of private agricultural lands and 581,813 hectares of public alienable and disposable lands that will still have to be distributed after 2008. These do not include the areas also still to be covered under leasehold.

The DAR also estimates that there will still be some 132,620 agrarian cases pending after 2008.

Various comprehensive and academic studies have established empirical data that CARP, where it was successfully implemented (i.e. where there has been successful land distribution and effective/sufficient support service delivery), have contributed to poverty alleviation, establishment of peace in the countryside, and improved the welfare of agrarian reform beneficiaries.

Q: Why we should opt for the CARP Extension with Reforms option?

A: Primarily, because it is the BEST legal option.

The 1987 Constitution (under Article 13, Section 4), with its provisions stating that there should be reasonable retention limits and that just compensation should be paid for lands acquired, have, in effect, declared that the agrarian reform to be pursued by the State will NOT be a confiscatory one.

The agrarian reform agenda set in the 1987 Constitution is a major improvement on the other agrarian reform agenda in previous constitution but is just short of what the peasantry have long considered as the genuine agrarian reform concept one that is based on the confiscatory land-to-the-tiller principle wherein there shall be no retention limit and lands will be acquired and distributed for free.

In effect, peasant groups who have been advocating for a new, genuine and more radical agrarian reform law (which is basically the call for zero retention limit and zero compensation) will have to first amend the constitution and, hopefully, have the political power and influence to remove the said provisions barring the realization of a confiscatory agrarian reform law/program or insert more radical agrarian provisions (i.e. zero retention and zero compensation).

Actually, given the limits set by the Constitution, the so-called new law that many groups want to pursue will eventually be the extension with reforms bill.

Q: Why not opt for a mere extension bill?

A: Simply because it has been tried in the past and it has not worked. RA 8532 was the expression of such an approach (extended CARP funding by ten years and replenished it with another fifty billion pesos) and after ten years CARP implementation remains incomplete.

Majority of the CARP extension bills pending in Congress follow the mere extension approach. Proposals are for an extension of CARP from five (5) to ten (10) years and the appropriation of additional funding from fifty to one hundred sixty-two billion pesos.

However, funding-wise, all other proposals will inadequately provide the needed funding for the program and, subsequently, ensure its completion. The Presidential Agrarian Reform Council (PARC) has estimated that another 320 billion pesos are needed to complete CARP within a ten (10) year extension period.

A mere extension approach/bill will also fail to address critical policy, bureaucratic and implementation issues (i.e. abuse of the Voluntary Land Transfer and leaseback schemes, CLOA/EP cancellations, etc.) that have proven to have caused the failure of the DAR to complete CARP implementation during the first extension period and even the reversal of CARP gains.

xxx

11 September 2007