Economic stimulus bills get top priority in Congress

MANILA, Philippines - Congress is expected to prioritize pending stimulus bills meant to revive the pandemic-beaten economy once it resumes session later this month, according to acting Socioeconomic Planning Secretary Karl Chua.

“Once Congress resumes, we expect them to prioritize the passage of the recovery program,” he said in a televised interview, noting that during the break, the economic team has been discussing with both houses of Congress “how to reconcile their various versions.”

Congress resumes its second regular session on July 27 when President Duterte delivers his fifth State of the Nation Address (SONA).

The House of Representatives passed last month trillions of peso worth of economic stimulus bills which include the much-contested P1.3 trillion Accelerated Recovery and Investments Stimulus for the Economy (ARISE) bill.

The economic team has repeatedly said this stimulus bill will be “unfundable” because of constitutional constraints, such as the need for it to be supported by additional revenue sources or savings which are currently not available.

The Senate has responded by downscaling its proposed standby fund under the Bayanihan to Recover As One bill (Bayanihan 2) – the follow-through bill to the Bayanihan Heal as One Act – to P140 billion, which is more acceptable to economic managers in line with the spending limits of roughly between P170 billion and  P180 billion.

The House has so far offered a staggered funding in three stages for the P688 billion in new spending under ARISE for the first year, meant to address the immediate effects of the pandemic on the economy. These would roughly be in tranches of P140 billion and two tranches of P280 billion.

ARISE is designed to help the economy recover from the pandemic in four years by providing wage subsidies, funding cash-for-work programs, zero-interest loans for companies and loan guarantees for banks.

The rest of the funding under the bill is aimed at three years of an enhanced infrastructure development program.

The lower chamber has also committed to act on Bayanihan 2 once the Senate passes it on third and final reading.

Chua maintained that other than the constitutional limitations on spending, the government is exercising prudence in borrowing to have more elbow room in the event the pandemic drags on.

“We don’t know when the virus will end. We would like to help as many sectors as possible, but we have to be mindful that if we put all our money out at one time, then what money do we have in the coming years?” he said.

“So all these are being factored in as we present a more prudent and constitutionally viable fiscal stimulus program.”

Congress is working against the clock to pass economic measures to revive an economy which already saw its first decline since the Asian Financial Crisis in 1998 and record high unemployment during the hard lockdown.