Aid to small firm workers unveiled but disbursement schedule unclear

MANILA, Philippines — As cash-strapped businesses grapple to stay afloat nearly a month into the Luzon lockdown, the Department of Finance (DOF) on Tuesday promised a P50.8 billion wage subsidy program for employees of small businesses to help them weather the impact of the coronavirus disease 2019 (COVID-19) outbreak.

Without committing to a schedule of fund release however, the DOF stressed that any delays in  financial aid rollout to 3.4 million targeted beneficiaries should not be blamed on the government, as the agency prioritizes giving help to taxpayers and social pension contributors with good standing.

In a statement sent to reporters, the finance department said eligible workers nationwide will receive a wage subsidy worth between P5,000 to P8,000 for two months. For this particular purpose, small businesses are defined as enterprises that do not belong to the top 2,745 large taxpayers identified by the Bureau of Internal Revenue.

Under the program, beneficiaries will be classified into two categories. On one hand, there are the 2.6 million workers who can be "easily identified and are automatically process for coverage” because their employers are compliant with the BIR and Social Security System regulations. However, another 800,000 workers employed by delinquent companies would have to wait as verification would take time. 

“The government understands that the non-compliance may have been caused by inadvertent mistakes on the part of the employer,” the DOF said.

Sought for details, Finance Secretary Carlos Dominguez III told Philstar.com in a text message: “As you can imagine, it will be very tedious as we will have to verify individual claims. As you also aware, any delay cannot be blamed on the government but rather is a result of non-compliance with the law and regulations."

The new assistance, devised as an answer to calls for aid to middle-income earners, is crucial as more Filipino workers are getting displaced by the lingering outbreak and local and national lockdowns. For small enterprises, forming part of 98% of local firms which are small and medium in scale, the impact can be devastating, as well as to their workers. 

In an indication of this, the number of displaced Filipino workers due to the outbreak swelled to 1.4 million as of Monday, already exceeding the DOF's own forecast of 1.2 million for the entire outbreak period.

Sought for comment, Philippine Exporters Confederation Inc. President Sergio Ortiz-Luis Jr. disagreed with the DOF's targeting system for the aid. “Employees of businesses that are not fully compliant will be placed in an unfavorable position. It’s not the workers’ fault that their employers are delinquent payers,” Ortiz-Luis said in a phone interview.

But Steven Cua, president of the Philippine Amalgamated Supermarkets Association Inc., an industry group of independent grocery stores, thought otherwise. “People who pay taxes are those who should be helped right now because they gave from their end,” Cua said in a separate phone interview.

“Those who never paid their taxes... they need the help, fine, but it’s payback time. Those who helped out should be helped first,” he added.