[My column in the Catalyst]
The Supreme Court, by a unanimous vote of 14-0, recently canceled the Stock Distribution Option (SDO) in Hacienda Luisita and ordered the distribution of more than 4,000 hectares of land in the Hacienda to more than 6,000 farmers. Though the Cojuangco clan may still move for reconsideration, it is now almost sure that the distribution would take please. This is a landmark victory for the cause of genuine land reform in the Philippines.
The call for putting the Hacienda Luisita under the Comprehensive Land Reform Program is correct. This is not only because the constitutional and legal requirements are fulfilled but also because the Hacienda has become a politically-sensitive issue that will have a bearing on the entire government land reform policy and on the Aquino administration’s popularity itself.
To be sure, the Aquino government, through the Department of Agrarian Reform (DAR) and the Presidential Agrarian Reform Council (PARC), has put forward a position for redistributing the Hacienda Luisita. The President himself divested his meager share in the hacienda. However, it is now incumbent on these bodies to ensure the implementation of the SC order follow the spirit as well as the letter of the decision.
The call for redistribution of individual plots to farm workers and peasant-tillers may not necessarily be correct however. The hacienda falls under the category of an enterprise farm–its main crop is sugar–that is best planted and managed on a large scale. CARP itself–and for that matter even the agrarian revolution program of the Communist Part of the Philippines–recognized this characteristic of a large plantation and recognized the retention of the plantation. Chopping off small plots (less than a hectare) for individual farm worker or peasant family will be an impractical proposition.
The first issue then in the distribution stage is: how to apply the concept of a large farm enterprise within a regime of the land reform program. Obviously, redistribution is an option, although not a viable one. The other options are to maintain the enterprise farm as a corporation or to establish as a cooperative with the farmer/peasant together with the former owners (who have their own shares) acting as stockholders and jointly deciding on the management of the farm.
The second issue is what compensation to pay the Cojuangcos and what to do with the reportedly PhP 2 billion debt of the Hacienda Luisita. There is the landowners’ contention that they should be compensated based on fair market value rather than the assessed value and that the asset (land) and the liability (debt) shall both be passed on to the farmers. They want the government to compensate them in the range of more than PhP 5 billion.
The government, through the Department of Agrarian Reform (DAR, has indicated that the government will not do this. The farmers, for their part, definitely do not want to pay what they think is the Cojuangco debt.
The only viable option within the context of the present administration, I think, for both sides to the controversy, is for the state to buy out the hacienda, give the Cojuangco family their share of the land, compensate them on the land to be distributed, and run the latter as a single cooperative enterprise. The debt should be subtracted from the Cojuangco share.
The Aquino administration has the opportunity to make a grand gesture for land reform in the country. How it will handle the Hacienda Luisita issue will have repercussion on the other and more problematic cases of privately-owned haciendas all over the country. It will also have an implication on whether or not it can create a wide enough domestic market for a sustainable economic development for the country and our people.