By Kyle Aristophere T. Atienza
THE GOVERNMENT needs to consider enacting a third stimulus package as a means of increasing incomes at a time of rising food prices, analysts said Sunday.
Emmanuel J. Lopez, dean of the Graduate School of Colegio de San Juan de Letran, said President Rodrigo R. Duterte must set the tone for his key allies in the Congress to focus the next package, which will likely be known as Bayanihan III following the naming conventions adopted in the first two rounds, on providing aid directly to the people.
Instead of imposing price controls, “the government should instead introduce a natural stimulus package that will create or augment incomes,” he told BusinessWorld in an e-mail.
He said the government should extend assistance to the hardest hit sectors.
Congress last year passed two laws ensuring funding for coronavirus response measures worth hundreds of billions of pesos, overriding the caution recommended by economic managers, who wanted to preserve the government’s resources in the event of a long pandemic.
Republic Act (RA) No. 11469 or the Bayanihan to Heal as One Act (Bayanihan I) reallocated about P275 billion of the 2020 budget for an emergency subsidy program, while RA 11494 or the Bayanihan to Recover as One Act (Bayanihan II) provided P165.5 billion for measures to boost the economy. A Palace declaration of priority status for such measures will remove some procedural hurdles to their passage while likely mobilizing the President’s Congressional allies.
“Meaningful stimulus is possible if the economic managers stop fetishizing creditworthiness and infrastructure and are willing to start raising wealth and income taxes on the rich,” Sonny A. Africa, executive director of IBON Foundation, told BusinessWorld via Facebook messenger.
He said a fresh stimulus program should include substantial emergency cash subsidies to increase household incomes and substantial agricultural support to raise productivity and lower food prices.
The House economic affairs committee in late 2020 created a technical working group to reconcile two bills in the House calling for a Bayanihan III law.
House Bill (HB) No. 8031, or the proposed Bayanihan to Arise as One Act, provides for an additional P400-billion stimulus package to help people deal with the challenges brought about by the pandemic, as well as the series of typhoons which hit the country in late 2020.
HB No. 8059, or the proposed Bayanihan to Rebuild as One Act, on the other hand, seeks to provide P247 billion to emergency response and economic recovery programs.
Asian Institute of Management Economist John Paolo R. Rivera said policymakers should “assess first the effectiveness of Bayanihan I and II” before dealing with a Bayanihan III.
“Has it been fully disbursed? What worked best and did not work? How can delivery be improved?,” Mr. Rivera asked. “All of these are also important to know because these will justify urgency,” he said.
Maria Ela L. Atienza, a political science professor at the University of the Philippines, said legislators and state auditors “should see first if these packages actually achieved their goals or if they worked before enacting new ones.”
“The administration cannot simply use public funds or get fresh loans if they have not accounted (for them) properly for previous spending,” she told BusinessWorld in an e-mail.
The House of Representatives is set to bring a number of major bills, including the proposed legislation amending the 33-year-old Charter, to the plenary by February. The Congress adjourns sine die in June.
Mr. Lopez said the President must keep his focus on pandemic-related aid or risk hurting the chances of his anointed presidential candidate.
Ms. Atienza said the administration’s response to the pandemic and the state of the economy will be some of the considerations when voters “evaluate whoever will be the anointed administration candidate in the 2022 presidential elections.”
“However, there are many other factors that can improve or hurt the chances of any presidential candidate, including whether there are other strong contenders, candidates’ personalities or at least how people perceive them which tend to be the basis of many voters in the absence of strong, programmatic political parties, media exposure, among others,” she said.