THE FINANCE department said it has asked the Philippine Crop Insurance Corp. (PCIC) to make more comprehensive financial disclosures but added that it has no plans to reduce the insurer’s subsidies after the company was placed under the department’s management earlier this year.
Finance Secretary Carlos G. Dominguez III asked the PCIC to present more financial information to “ensure that its premium subsidies paid for by taxpayers are spent well,” the Department of Finance (DoF) said in a statement Tuesday.
Mr. Dominguez was quoted as saying that the continued subsidies will go hand in hand with ensuring that the company is efficiently run.
The PCIC board, chaired by Mr. Dominguez, wants to evaluate the insurer’s spending relative to industry peers, he said.
PCIC President Jovy C. Bernabe said the company will start presenting its financial statements according to the Philippine Financial Reporting Standards 4 (PFRS 4) as of August 2021. The PCIC will also restate financial reports from the last two years to comply with these standards.
“The objective of this whole exercise is that we want to make sure the taxpayer is getting value for money,” Mr. Dominguez said.
He also said the PCIC should act on an Insurance Commission recommendation to revisit the corporation’s Risk Premium Rate assumptions in pricing products by March, noting that the assumptions may be “inadequate, unreasonable and inappropriate.”
The PCIC should hire a consultant with an extensive background in agricultural insurance, he said, noting that the corporation’s process in evaluating agricultural losses from pests and diseases should be reviewed so that this type insurance coverage does not become a source of fraud and fund leakage.
Mr. Dominguez, named PCIC chairman following the government-owned company’s transfer from the Department of Agriculture, has said that he plans to scale up the available crop insurance to mitigate financial losses due to natural calamities intensified by climate change.
The PCIC received P2.24 billion in government subsidies in September, more than six times last year’s total, the Bureau of the Treasury said. It did not receive subsidies in August. — Jenina P. Ibanez