Enhancing the Allocative Efficiency of Funds for the Total Tobacco Contract Growing System (TOTAL-TCGS) : a Policy Proposal for the Participating Tobacco Buyer-Firms and the Local Government Unit (LGU) Recipients of Tobacco Excise Taxes /
Giovanni B. Palabay.
- 79 leaves : color illustrations
Public Management Development Program.
The Tobacco Contract Growing System (TCGS) as the centerpiece program of the National Tobacco Administration, is continuously being implemented but not without problems. Orginally conceived as Tobacco Contract Growing Program (TCGP) in CY 1985-1986, it was a result of a five (5)-year experiment as a market-oriented and technology- based production system. As of this crop year, it had not covered all the tobacco farmers because of the financial inadequacies of the government and the tobacco buyer-firms. Not all of them had not been contracted and financed, that NTA and the various tobacco buyer-firms could only assist and support limited number of tobacco farmer- beneficiaries. Much so that the NTA is gradually withdrawing from providing production loan assistance for tobacco production due to limited funds. It is through this context that this policy paper would addressed, that is how much funds will be allocated and shared by the different stakeholders particularly the participating tobacco buyer-firms and the local government units concerned, specifically to finance the needed production assistance of all tobacco farmers for them to produce the desired quality and quantity of tobacco demanded by local and foreign markets. There were four (4) identified options to deal with this policy problem. After weighing the advantages vis-a-vis the disadvantages of the policy issue, analyzing the interest of the various stakeholders, and a critical analysis and evaluation using the different decision criteria of effectiveness, equity, political feasibility, administrative capability and administrative cost, the study came out with the best option of joint and equal sharing for the total financing of all tobacco farmers, such that 50% each of the cost of production will be financed by the participating tobacco buyer-firms, and the other 50% will come from the local government units concerned.