FINANCE Secretary Carlos Dominguez on Tuesday said government will assist the middle class sector amid the COVID-19 pandemic by subsidizing the pay of workers in micro, small, and medium enterprises (MSMEs).
Dominguez, in a statement, said the Bayanihan Law grants President Duterte the power to use funds of government-owned and -controlled corporations (GOCCs) to realign the 2020 budget during the period of contagion, to meet government’s new priorities in response to the health crisis.
“We are implementing a P205 billion program over two months to provide support for those in the informal sector, in addition to fully funding the needs of the health care sector,” Dominguez said.
“We will reallocate funds for assistance to local governments, assistance to MSMEs by subsidizing the salaries of their employees who are mostly what some would call lower middle class, support the Department of Agriculture/Department of Trade and Industry in enhancing food production and availability,” Dominguez said.
Rosemarie Edillon, National Economic and Development Authority undersecretary, in a radio interview with dzBB, said the middle class is included in the government’s COVID-19 response.
“Actually, the middle class is included because it’s for 18 million families. We only prioritized the poorest of the poor, but they are included in the budget,” Edillon said.
However, Edillon said that one bottleneck is the lack of registry for those who are considered middle class.
“When we set the Bayanihan budget, they are also included, but the problem is the (lack of) registry. We have a rough estimate regarding the number (of families) but as to who they are and how the transfers will be done, that is the problem,” Edillon said.
“It was easier to prioritize the poorest of the poor because they are registered in the list, they have cash cards, so that’s what we’re trying to fix. That’s why we also have the social amelioration form,” she added.
Meanwhile, Dominguez said that the government is aiming to maintain the Build, Build, Build initiative which will help the economy recover quickly upon the defeat of the virus.
“Together with the Bangko Sentral ng Pilipinas, Securities and Exchange Commission, and others, we have implemented measures such as a moratorium on payment of loan and credit card amortizations, prohibition of charging compounded interest and penalties during the period of contagion,” Dominguez said.
“In addition, the Monetary Board had provided liquidity for the economy and lowered interest rates. These measures favor all sectors of society specially those some people call middle class,” he added.
Dominguez said that the fiscal policies since the start of his administration, of vastly improving revenue flows as well as being very judicious with expenditures and investments, have placed the government in a good position to meet the financial challenge posed by COVID-19.
“We must realize however that we do not know how long this contagion will last and that our funds are not inexhaustible,” Dominguez said, adding: “We must therefore prudently marshal our resources and prepare for all eventualities.”
President Duterte on Monday night ordered Dominguez to scout for additional funds to boost government’s financial resources for its campaign against the deadly coronavirus. The President said the P275 billion set aside by Congress under the Bayanihan Act will not be enough to sustain government expenses in the fight against, which includes government aid for low-income families and vulnerable sectors and improving health facilities and the healthcare system.
Bayan Muna party-list Rep. Carlos Isagani Zarate does not believe the President’s claim that there are not enough funds to sustain the government’s COVID response fund, saying Duterte is simply “hiding his inability and inefficiency in allocating resources and distributing financial assistance to the people.”
“It is not true that the reason for the confusion and the failure to give financial assistance to people is because there are no funds. He promised us that he will be able to get all the funds, if we give him emergency powers through the Bayanihan Law. But until now, many are still left without help from government,” said the militant lawmaker.
Unlike Duterte’s “bullying” style in previous speeches, Zarate said the President changed tack in his Monday night speech as he explained the problems besetting his COVID response to lack of funds, “seemingly asking for pity and understanding from the people.”
He said the President, in his own report, admitted that there are billions in unreleased appropriations because the administration is still “crafting guidelines” for the release of livelihood assistance, the Land Bank is still “expected to commence payout” to jeepney drivers, and the DBM is “about to release grant to LGUs.”
Deputy Speaker Mikee Romero urged the President to use government savings to fund the P5,000 to P8,000 in financial assistance to poor families, pointing out that since the lockdown has forced many government offices to temporarily close “the bureaucracy is naturally generating a lot of savings in funds for maintenance and other operating expenses (MOOE).”
The House leader noted that MOOE expenses amounts to P1.6 trillion in this year’s P4.1 trillion national budget.
He said bureaucracy is saving costs for fuel and other oil products, electricity, water, supplies and materials, communication, advertising, representation or dining out and entertainment, and travel.
“If we save 10 percent of that during the 45-day ECQ up to April 30, that will come up to P160 billion. If we save five percent, that is P80 billion in additional funds for financial aid to 18 million poor and near-poor families affected by the lockdown,” he stressed.
The House leader said savings from the low cost of crude oil in the world market could also be used for financial assistance to the poor or for procuring essential supplies for healthcare workers since the government is no longer spending tens of billions in appropriations for oil-related expenses.
Romero, an economist, noted that the cost of crude has been steadily decreasing since January from $54-$55 per barrel to less than $25.
Deputy Speaker for finance Luis Raymund Villafuerte asked the budget department to take “a long hard look” at adjusting 2020 GAA items for non-essential expenditures, with the would-be savings to be used to augment public funds for COVID-19 response.
Villafuerte said that “forced savings in non-essential spending such as those on foreign travel or the purchase of brand-new official vehicles plus office supplies and equipment should go to a pool that the national government could use to expand and extend its programs to cushion the economic fallout from the pandemic and to better equip the country’s health workers in saving lives and treating infected Filipinos.”
He said the DBM should also look at realigning 2020 allocations for, among others, the AFP modernization program, the procurement of which could be made later after the pandemic; the budget for the 2020 Tokyo Olympics that has been postponed to next year; and the outlays for tourism expos and investment roadshows abroad, as the internal travel and business communities are obviously in no mood to entertain such activities at this time amid the global health crisis.
HELP FOR THE MIDDLE CLASS?
Albay Rep. Joey Salceda, chair of the House committee on ways and means, proposed that all Filipinos except those in the top 10 percent of the population be given P1,000 each in emergency assistance to help the middle class.
“It will do away much of the convoluted eligibilities and make for faster distribution,” he said, citing his March 19 recommendation to the IATF.
Salceda underscored the contribution of middle-income households to the country’s tax intake, saying that “households in the 7th, 8th, and 9th deciles contributed some P44.4 billion in taxes, of which P29.4 billion were personal income taxes.”
He noted that the average lower-middle to middle income family receives between 9,500 and 27,000 pesos in additional take home pay every year due to TRAIN.
“Clearly, the President takes the middle class into consideration in his economic policies. Kaya lang, siyempre po, uunahin muna talaga ang mahihirap (But we have first to prioritize the poor, of course). From the perspective of welfare po, sila talaga ang pinakaunang tutulungan (they will be the first to be assisted),” Salceda said.
In Angeles City, Mayor Carmelo Lazatin Jr. said a stipend of P1,000 each will be given to Angeles City’s 55,815 senior citizens, 5,000 persons with disabilities (PWDs), 12,000 tricyle drivers, 3,000 jeepney drivers, and 5,000 solo parents.
Funds for the cash aid were appropriated by the Sangguniang Panlungsod through the enactment of a supplemental budget.
Lazatin said the local government’s initiative is separate and on top of Angeles City’s share in the P200 billion special amelioration program of the national government through the Department of Social Welfare and Development.
While the beneficiary drivers, PWDs, and solo parents had to go to designated payout areas to get their stipend, the city government made sure that elderly residents would not have to leave their homes.
“The financial assistance (for senior citizens) will be delivered house-to-house. It is just a small amount but it will help tide over our elderly residents,” Lazatin said.
To ensure an orderly process, the city government worked with the Federation of Tricycle Operators and Drivers Association (FEDTODA) and jeepney drivers-members of Pangkalahatang Samahan ng mga Drayber sa Angeles City (PASADA).
In a separate public notice posted by the Angeles City Information Office, the city leadership has likewise set aside P10 million to fund the Special Risk Allowance (SRA) of city health workers.
The grant of SRA is in accordance with the Administrative Order No. 28 released on April 6, 2020 issued by President Rodrigo Duterte. – With Wendell Vigilia and Peter Tabingo