MANILA, Philippines — The House of Representatives was set to approve last night the proposed P1.3-trillion economic stimulus measure to address the impact of the coronavirus disease 2019 (COVID-19) crisis on livelihood and on the economy in general.
In a virtual plenary session, House members were set to decide via voice vote to pass on second reading the substitute bill for the proposed Philippine Economic Stimulus Act (PESA) after deliberations last Wednesday.
The measure, approved by the Defeat COVID-19 Committee (DCC) earlier this week, is set for passage on third and final reading before Congress adjourns sine die next week.
The PESA bill, introduced by Albay Rep. Joey Salceda and Marikina Rep. Stella Quimbo, seeks to provide P155 billion this year to a wage subsidy program for workers of private companies affected by the crisis, particularly by the two-month enhanced community quarantine (ECQ).
Also to benefit from the fund are cash-for-work and student loan programs.
Through the Department of Labor and Employment, the wage subsidy program would cover payroll costs of non-essential companies severely affected by the quarantine period through wage subsidies, with a range of 25 percent to 75 percent for two months.
The bill also seeks allocation of P140 billion this year for zero and negative interest loan programs to be implemented by the Land Bank of the Philippines (LBP) and Development Bank of the Philippines (DBP) as well as loans for micro, small and medium enterprises through the Small Business Corp. and Philippine Guarantee Corp.
Companies will be given a maximum loan amount equivalent to 50 percent of their labor costs payable in three to five years.
Salceda explained that the loan program would offer a negative interest package as a condition for companies to retain their workforces.
“Our negative interest loan proposal is an incentive to retain employees and sustain the size of a firm’s operation. The negative interest benefit serves essentially as the government’s co-pay for whatever investment the firm will undertake,” the House ways and means committee chairman explained.
Salceda said the loans would be an off-balance-sheet, which means they will not affect the overall financial position of LBP and DBP.
“We believe that a negative interest rate loan is a fiscally viable economic stimulus program primarily because while it fulfills a liquidity-expanding function, most of its upfront costs are recoverable, and the only real net fiscal cost to government will be loan administration costs and the negative-interest benefit,” he explained.
The PESA bill also seeks the appropriation of P650 billion to enhance the Duterte administration’s “Build, Build, Build” program over a period of three years starting in 2021. The enhanced BBB is expected to create 1.5 billion jobs.
The PESA bill also covers funding of P20 billion for mass testing nationwide.
Quimbo cited the importance of mass testing in reopening the economy after the community quarantine measures.
“The lockdown costs P18 billion per day. We’re on lockdown because we don’t know who’s carrying the virus. That’s why mass testing is very crucial. The benefits of mass testing outweigh its cost. Bottomline is we will lose bigger money if we don’t do it,” she said.
Bills rushed
Meanwhile, measures aimed at improving the healthcare system are being rushed at the House of Representatives as the COVID-19 crisis continues to take toll on human lives and the economy.
“We need to have these bills enacted into law as soon as possible if we want to rescue our people from further harm and even starvation in the wake of the COVID-19 pandemic. The lives and livelihood of our people are at stake here,” Majority Leader Martin Romualdez said.
“We really have no choice but to fast-track the approval of these vital measures,” the Leyte congressman said as the Defeat Covid-19 ad hoc committee that he co-heads “endorsed” for plenary approval crucial pieces of legislation to resuscitate the weakened economy.
Romualdez said the measures are aimed at “generating jobs for displaced workers, preventing further the spread of COVID-19 by imposing tests, strict mandatory safety and physical distancing protocols.”
The measures include the P1.3-trillion PESA, Financial Institutions Strategic Transfer (FIST) Law and the Anti-Discrimination Bill.
Another one is House Bill 6709, or the P1.5-trillion social amelioration program under the proposed “COVID-19 Unemployment Reduction Economic Stimulus (CURES) Act of 2020” authored principally by Speaker Alan Peter Cayetano, Romualdez, Deputy Speaker LRay Villafuerte, Deputy Speakers Paolo Duterte and Loren Legarda; and Reps. Mike Defensor (Anakalusugan), Eric Go-Yap (ACT-CIS), Laarni Cayetano (Taguig) and Jose Antonio Sy-Alvarado (Bulacan).
“We all know that dole-outs do not provide a sustainable living to the people. It is incumbent upon us to come up with an economic stimulus package that assures sustainable employment and an improved economy,” Romualdez said.
“It will set the stage for Congress to help the Duterte administration reset the economy and generate jobs following the sudden work stoppage set off by the quarantine measures,” Villafuerte said of the stimulus fund.
He also said CURES will “blunt the impact of what the International Monetary Fund expects to be the worst recession since the Great Depression in the 1930s.”
The measure, he added, is “guaranteed to create a multitude of employment opportunities, especially in rural areas, to partly make up for the jobs that were lost amid the coronavirus pandemic.”
Sen. Sonny Angara, meanwhile, said the Senate will work with private enterprises “to see how government can help reduce their hardship.”
He said the Senate committee on finance, which he chairs, is set to hold a hearing today on the economic stimulus and recovery bills to address the impacts of COVID-19 on livelihood and on the economy in general.
“We want to hear from the representatives of the private sector about how the COVID-19 pandemic has affected their operations. What have they been doing to keep afloat during the lockdown and what have they done to help their employees?”
“Moving forward, we will determine what must be done to help them minimize their losses and preserve the jobs of their employees now that they will have to operate under a drastically different environment that we are calling the new normal,” Angara added.
Today’s hearing will be conducted jointly with the committee on economic affairs headed by Sen. Imee Marcos
“This is an economic stimulus because the COVID-19 pandemic is said to be the biggest economic downturn since the Great Depression of the 1930s. Back then it took around three years before some economic recovery was seen. We must act swiftly. We do not want to repeat the mistakes of the past and we want to help those who really need it,” Angara said.
“This will also be a good time to review some of the programs rolled out under the Bayanihan We Heal as One Act. We’ll take a look at what is working and what needs tweaking, if any,” Angara said. Delon Porcalla, Cecille Suerte Felipe