Coronavirus: $3.9 billion cash subsidy for Filipinos hit by Luzon lockdown

02, Apr. 2020

Photo by ALBERT RENN on Unsplash
Photo by ALBERT RENN on Unsplash

By Darlene Basingan

MANILA, NNA – Millions of poor Filipino families being locked down for a month on Luzon Island will soon receive government cash and food subsidies amounting to 200 billion pesos ($3.9 billion) to help them rebuild lives.

The Philippine government is also preparing a separate financial package to help micro, small and medium-sized enterprises (MSMEs) which could not operate under the strict community quarantine enforced on the entire island on March 16 to stem the spread of coronavirus outbreak.

In a public address on Monday, Philippine president Rodrigo Duterte said the subsidy would be the largest-ever direct financial assistance to be given by the administration to Filipino families in the country’s history.

Rolled out on April 1, the subsidy will benefit some 18 million low-income households surviving day-to-day on subsistence wages or no-work-no-pay arrangements.

Apart from cash amounts, essential items such as food would be distributed over the next two months, said the department of finance in a press statement.

Families whose livelihoods were impacted by the coronavirus crisis will receive between 5,000 pesos to 8,000 pesos a month for two months depending on the minimum wage rate in their region.

“We need to take care of our people first because that is the primordial duty of the government and society, especially during crises such as this pandemic,” finance secretary Carlo Dominguez said in the statement.

Separately, the Philippine labor department is giving out a cash support worth 5,000 pesos to every formal-sector worker who has not been able to earn a living because of the stay-at-home order.

More than 630,000 workers were displaced as of March 31,2020, according to government data. Among them were 169,232 contract workers.

The National Economic Development Authority (NEDA) estimated that 116,000 to 1.8 million Filipinos would lose their jobs if the adverse economic impact of the pandemic stretches till June.

The Luzon lockdown alone might result in 61,000 to 1 million job losses, NEDA said.

The restrictions on movement and activities had crippled both big and small businesses. Only banks, business-process outsourcing and export-oriented companies, as well as firms that manufacture or deliver essential services like food, water and medical supplies are allowed to operate.

While some companies could continue to run with staff working from their home, many small businesses like retail shops selling non-essential products were unable to operate in that manner.

The government has yet to announce financial help for sectors bearing the brunt of the lockdown.

But giving his assurance, Dominguez said, "We will eventually put in place programs for affected businesses so that the economy could bounce back as soon as we beat this lethal virus."

He said the government's top priority was to help Filipinos badly hit by the crisis first.

Cabinet secretary Karlo Nograles said in a livestreamed briefing on Wednesday that the government is already preparing a 1-billion-peso financing program for MSMEs. It will be launched at the end of the lockdown before the middle of the month.

In a statement, NEDA said it is now formulating a plan to rebuild businesses and consumer confidence.

NEDA said the growth rate of the economy could decline to 4.3 percent in 2020. But it expects even lower growth if the quarantine period extends beyond a month, or if the spread of the virus called Covid-19 continues even after the lockdown.

Business groups have been hoping that the government would not extend the quarantine period.

However, authorities have yet to decide if they would partially lift the lockdown, expand it to other areas or extend the Luzon quarantine beyond its scheduled end on April 12.

As of Wednesday, the Philippines recorded 2,311 confirmed Covid-19 cases and 96 deaths.