LAWMAKERS are proposing a P370-billion fiscal stimulus package to help the middle class and save businesses from the economic impact of the Luzon-wide enhanced community quarantine (ECQ) imposed to contain the spread of the coronavirus disease (COVID-19).
The amount will be on top of the P275 billion that the government has set aside under the Bayanihan to Heal as One Act to help 18 million poor families affected by the lockdown, which has been extended until the of this month.
The economic stimulus cluster of the House of Representatives’ Defeat COVID-19 committee led by Albay Rep. Joey Salceda held a technical working group (TWG) meeting via teleconferencing on Tuesday to discuss the proposal aimed at saving the micro, small, medium enterprises (MSMEs).
The package which is yet to be filed as a bill will be titled “Economy Moving Forward as One Bill.”
“We have to flatten the (COVID-19) curve, not the economy,” said Marikina Rep. Stella Quimbo noting her proposal, which includes a P110-billion wage subsidy, will benefit 29 million workers affected by the COVID-19 pandemic.
Quimbo said the measure, which focuses on labor retention and payroll maintenance, will be enacted as a post-COVID measure aimed at averting business closures and layoffs.
“Ito ay upang siguraduhin na wala magsasarang negosyo, walang mawawalan ng trabaho or mababawasan ng kita (This is to ensure that no business will close down, no one will lose jobs or lose part of their income),” Quimbo told the panel via Zoom app.
“Twenty-nine million workers can be affected by COVID-19, in varying degrees. If the effect on a business is severe, layoffs can happen. If the effect is moderate, there may not be layoffs but compensation is reduced,” Quimbo said.
‘GREATEST DIFFICULTY’
Quimbo noted that the number of formal MSMEs most affected by COVID-19 in the whole country is 746,980 while informal MSMEs is at 4.5 million.
She said MSMEs will have the “greatest difficulty coping with shocks” and the government will have no other choice but to directly intervene through a financial package.
Quimbo said the government is forecast to spend some P700 billion for its COVID measures, of which P300 billion will be for the implementation of approved expenditures under the Bayanihan Act, and P370 billion for the fiscal stimulus package “geared towards labor retention via business continuity.”
Quimbo proposed that the P370 billion be spent as follows: wage subsidies, interest-free loans, loan guarantees, grants to support activities to improve business resilience and compensation for paid sick leaves for COVID patients.
AAMBIS-OWA party-list Rep. Sharon Garin, who also made her own proposal, said the economic stimulus package will “secure our workers’ sources of income to be able to feed their families.”
“No one should lose jobs after the ECQ. We have to save the economy after saving people from COVID,” she said. “All employees, regardless if it is white or blue collar, need government intervention in order to help them out in this predicament. After the ECQ, we need to safeguard their livelihood.”
FOUR-PILLAR STRATEGY
The total value of the government’s four-pillar socio-economic strategy against COVID-19 has increased to P1.45 trillion as the government firmed up its subsidy for employees in small enterprises and provide support for small businesses.
In a presentation during an online hearing of the House, Finance Secretary Carlos Dominguez said that “the strategy now has a combined value of P1.45 trillion or 7.8 percent of gross domestic product.”
Dominguez’ presentation showed that the amount for the wage subsidy for employees of small businesses has increased from the initial estimate of P35 billion to P51 billion.
The new table also now includes P120 billion in credit guarantee for affected small businesses, and nearly P140 billion net operating loss carryover of five years to help businesses cope with losses.
These are under the first pillar, or the emergency support to vulnerable groups and individuals, bringing the estimate for this pillar to P583.8 billion from the previous P305.2 billion.
The second pillar, which focuses on health insurance coverage for all COVID-19 patients; providing special risk allowance, hazard pay, and personal protective equipment for frontline health workers; and increasing testing capacity, among others, has a combined value of P35.72 billion.
The third pillar includes P610 billion worth of available financing from various sources and P220 billion of liquidity infusion, for a total of P830 billion.
The last pillar focuses on designing the bounce-back plan for post-quarantine scenario, conducting a nationwide survey to assess the damage to industries, and continuing investment in social and infrastructure programs to help revive and sustain economic growth. — With Angela Celis
