The much-awaited emergency subsidy, is there?

By: Fernando Fajardo - Columnist/CDN Digital | April 01,2020 - 07:14 AM


Last Saturday, March 28, 2020, Executive Secretary Salvador Campo Medialdea, acting on behalf of President Rodrigo Roa Duterte, issued a Memorandum providing for the implementation of temporary emergency powers granted to the President. The memorandum serves as the order of battle to all concerned agencies directly involved in the implementation of the Bayanihan to Heal as One Act (RA 11469).

The objective of the memorandum is to achieve the government’s aim of overcoming the present threat brought about by COVID-19 from China and making cohesive and harmonious the simultaneous government efforts on different fronts to:

  1. Protect and support our health workers and frontliners; 
  2. Provide the supplies and equipment necessary for detecting the disease and caring for those infected; 
  3. Ensure that community quarantines are effectively implemented and essential necessities such as food and medicine to the most vulnerable delivered; 
  4. Keep essential and critical utilities and businesses running and their processes uninterrupted; 
  5. Provide temporary economic relief to Filipinos and businesses; and
  6. Mobilize all state assets to sustain the operations of the government.

The agencies concerned are DOH (Department of Health), DSWD (Department of Social Welfare and Development), DBM (Department of Budget and Management), DOF (Department of Finance), DTI (Department of Trade and Industry), DILG (Department of Interior and Local Government), DOLE (Department of Labor and Employment), DoTr (Department of Transportation), DPWH (Department of Public Works and Highways), DOE (Department of Energy), PhilHealth (Philippine Health Insurance Corporation), NWRB (National Water Resources Board), OCD (Office of the Civil Defense), NDRRM (National Disaster Risk Reduction and Management) Council, and all other relevant agencies of the national government and local government units.

Of these agencies, the most critical is the DOH in our fight against the deadly COVID-19 or coronavirus disease 2019 from China. As expected, the DOH, following World Health Organization guidelines and best practices, must adopt and implement measures to prevent or suppress further transmission and spread of the virus through effective education, detection, protection, and treatment. 

Among other things, the DOH must also ensure that all public health workers are protected by providing them with a “COVID-19 special risk allowance” and that those who may contract severe COVID-19 infection or die while in the line of duty are compensated.

Presently, many of our people, especially the poor, are worried of the loss of their income because of the lockdown. Is there an emergency subsidy? How much? Which agency of the government will provide it?

Here, the job in providing subsidy falls on the DSWD. The memorandum implementing the Bayanihan to Heal as One Act orders the DSWD to provide an emergency subsidy to around 18 million low income households in the amount not lower than P5,000.00 or higher than P8,000.00 a month for two (2) months. The final amount is computed based on prevailing regional minimum wage rates and after considering the conditional cash transfer program and rice subsidy presently existing. In his press con the other night, the President mentioned 200 billion pesos available for this purpose.

Assuming the 18 million targeted households are fully covered, this would require the DSWD to distribute between 180 billion pesos to 288 billion pesos or roughly 234 billion pesos in average in two months. This exceeds the 200 billion pesos intended for the subsidy. 

However, is that amount really needed?

My answer is no. This is because the 18 million (I wonder where they got this figure) households targeted for coverage is highly overblown. It is overblown because in the 2015 census the total population of the country was counted only at 100,979,303, which corresponds to 23 million households at 4.4 persons per households in that year.

Using 1.72 percent annual growth rate of our population observed from 2010 to 2015, this year’s total population would be about 110 million. This would correspond to about 25 million households at the same average number of 4.4 persons per household.

If we target 18 million households for emergency subsidy, that would mean covering 72 percent of our 25 million total number of households. It also means that not just the poor but also the middle-income households and some of the upper class are subsidized.

We do not have the luxury to do this because of our limited resources. Apart from emergency subsidy, we also need more funds in fighting the virus directly such as those for the purchase of the very much needed test kits, personal protective equipment, vents, hiring of additional health personnel, and many more such as those needed to help business, especially the small ones, to recover.

At the minimum, we could use the number of our households considered officially in poverty as our target for subsidy. This was last measured at 16.5 percent of our total number of households in 2015. Using this rate would require us to provide emergency subsidy to only 4.125 million households out of the 25 million total estimated number of household that we have presently. At 5,000 pesos per household for two months, this would only amount to 41.25 billion pesos or 66.0 billion pesos at 8,000 pesos per household for two months.

If this minimum target is too low, we can increase this to include all those households in the bottom third of our population based on household income size. Now this is about 8.33 million households in all, less than half of the original 18 million targeted number of households. The total requirement for this is 83.3 billion pesos minimum or 133.3 billion pesos maximum, so we do not have problem with funds if the 200 billion mentioned by the President is there.

Now the question is whether there really is 200 billion pesos available to the President now. This is what I will tackle next Wednesday. For now let us just stay home and be a hero if only by saving just one life. Our own life. /dbs

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TAGS: Bayanihan Heal as One Act, COVID-19, DSWD, emergency subsidy, RA 11469

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