The government is considering a proposal to rationalize the Quedan and Rural Credit Guarantee Corp. (Quedancor) instead of deactivating it, a ranking official of the Department of Finance (DOF) said yesterday.
Officials and employees of Quedancor have been appealing to the government to exhaust other options for the agency instead of deactivating it.
Finance Undersecretary Jeremias Paul Jr. said government economic managers have agreed not to deactivate Quedancor and are now reconsidering rightsizing it instead.
“What we’re looking at now is not to deactivate the agency. We can just do rightsizing. There’s no need for Congressional approval for this,” Paul said.
Quedancor, which is mandated to accelerate the flow of credit resources to the countryside, has not been doing its functions and has been losing money because of mismanagement.
In 2007, Quedancor had a net loss of P286 million and in 2006, a net loss of P23 million.
Initially, economic managers wanted to deactivate Quedancor but Paul said they have reconsidered amid appeals from employees.
Paul said the agency is now studying how the government can rationalize Quedancor.
“What we’re studying is how we can do that. What we’re looking at is that they will just stick to their core mandate which is to provide guarantees,” he said.
Quedancor officials and employees are opposed to the proposed deactivation. Instead, the agency wants a P3.5 billion bailout package which officials said would make Quedancor sustainable.
However, the Finance department approved a bailout package of only P475 million to help Quedancor.
Northern Samar Rep. Paul Daza earlier said that whatever the government decides to do with Quedancor, it should deal with employees fairly. Officials said the government is looking at cutting Quedancor’s workforce of 1,200 employees in half to save on costs.