The 4-Pillar Socioeconomic Strategy

Due to the ongoing COVID-19 pandemic, Inquirer.net is constrained to take a step back and reassess its operation in Cebu. As a result, CDN Digital columnists were advised to end our tasks effective end of this week. With this note, therefore, let me bade farewell to all my Post Prandium followers. However, you can still follow Post Prandium or my after meal thoughts that I write weekly in my personal blog here: https://www.facebook.com/perry.fcfajardo. 

I started Post Prandium about a year ago. It succeeded my Reflections from Paseo de Coro column with Cebu Daily News before its migration to a digital format last year. Paseo de Coro was the name I gave to a place in Barangay Coro, Dalaguete, Cebu where I built by house overlooking the sea in 1995. It was there where I wrote most of my columns with Cebu Daily News from 1998 up to 2007 when my wife and I moved back to the city in consideration of her ailment from cancer.

These days of the pandemic are no picnic. All of us fear for our lives. For our protection, the government is putting us all under enhanced community quarantine (ECQ). No excuse, except those greatly needed to work in hospitals to take care of the sick and those badly needed to run our vital industries to assure that there is enough supply of necessities and food for all of us under quarantine.

I do not have to point how every one of us suffers from the ECQ. It prevents us from doing the usual things we do outside our home, including going to work. It is just unfortunate that for many of us, not going to work means losing also our power to buy the food for the day. Of course, the government is trying to provide emergency subsidy to those most in need, estimated to be 18 million households at P5,000 to P8,000 per household a month for two months. 

There are items identified in the current national government budget where funds would be taken away for use in the subsidy and other new expenditures arising out of the COVID-19 emergency. However, there is not enough cash on hand because of the fall in government revenues starting in March due to the closing of many business activities to prevent the spread of the coronavirus. This forces the government to borrow more, thereby exceeding the year’s fiscal deficit target and the size of public debt beyond what was programmed to be incurred this year.

The ECQ started in the middle of March. At the start of this month, the president changed the quarantine status of many places in the country from ECQ to general community quarantine (GCQ) except in areas where new infection cases are still high. The areas still under ECQ include Metro Manila, Central Luzon (except the Province of Aurora), Calabarzon, Pangasinan, Benguet (including Baguio City), Iloilo (including Iloilo City), Bacolod City, Cebu (including Cebu City), and Davao City. 

By GCQ, it means that many businesses not crucial to the spread of the virus with social distancing are allowed to operate and most of the people are allowed to go back to work or do other things outside their home, except senior citizens and children.

More than the dangers to our health, however, the emergency that arose out of COVID-19 also includes disruption of the normal operation of business and the economy. To address these two challenges, the government has prepared the 4-Pillar Socioeconomic Strategy. The four pillars are:

Pillar 1:

Emergency support for vulnerable groups and individuals.

Pillar II:

Expanded medical resources to fight COVID-19 and ensure the safety of frontliners (health insurance coverage for all COVID-19 patients; special risk allowance, hazard pay, and personal protective equipment (PPE) for frontline health workers; increased testing capacity; etc.

Pillar III:

Fiscal and monetary actions to finance emergency initiatives and keep the economy afloat, which includes standby financing for Pillar IV or the economic recovery plan, and liquidity infusion into the economy.

Pillar IV:

An economic recovery plan to create jobs and sustain growth. This plan is still undergoing preparation.

The total budget of the 4-pillars strategy is now at P1.49 trillion, much higher than the P320.1 billion originally envisioned.

Pillar 1 (emergency support to vulnerable groups) is now at P 590 billion. This is P284.8 billion higher than the previous estimate due primarily to the inclusion of the small business support programs.

Another reason for the increase is a fuller costing of the Bayanihan to Heal as One Act amounting to P22.8 billion. This increased the total of Pillar 2 (funding the fight against COVID-19) to P58.6 billion.

Pillar 3’s (fiscal and monetary actions) total increased to P843 billion, which is P12.53 billion higher than the previous version due to updated BSP estimates of liquidity infusion from the policy rate reductions.

Money generated or the new liquidity being created under Pillar III is what will support the implementation of Pillar IV. In my Post Prandium personal blog next week, I will discuss the accomplishment so far in each of the 4-Pillars.

So, friends, farewell for now. Hope to see you in my personal blog! /dbs