DSWD chief: P2,400 subsidy not enough to shield poor from TRAIN impact

Aika Rey

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DSWD chief: P2,400 subsidy not enough to shield poor from TRAIN impact
'Ang sabi po ngayon, na hindi sapat ang tinutulong na P200 a month. Totoo naman pong hindi,' says Social Welfare Acting Secretary Virginia Orogo

PAMPANGA, Philippines – The P2,400-government subsidy for poor families  is “not enough” to shield them from the full impact of the tax reform law, Social Welfare Acting Secretary Virginia Orogo said on Friday, June 15.

The Department of Social Welfare and Development (DSWD) started giving a lump sum subsidy of P2,400 to 733 indigent senior citizens on Friday in San Fernando City, Pampanga.

The amount is the government’s financial assistance to poor households amounting to P200 a month, to curb the effects of higher prices due to the Tax Reform for Acceleration and Inclusion (TRAIN) Law. (READ: [OPINION] Dissecting TRAIN’s impact)

“Ang sabi po ngayon, na hindi sapat ang tinutulong na P200 a month. Totoo naman pong hindi (Some say that the P200 a month aid is not enough. It is true that it is not [enough]),” Orogo told the senior citizens.

Orogo assured poor families that the DSWD will provide “sustainable” aid to help them cope with the effects of TRAIN. (READ: Dissecting TRAIN’s impact on our incomes)

“Our help to the Filipino people will be sustainable. Our assistance is not only a stop-gap measure. We are studying how we can intervene in other ways,” Orogo said in Filipino.

The DSWD is planning to visit communities through a basic services caravan with other agencies.

Orogo said that the P2,400-subsidy will be distributed to around 10 million poor households by the end of September.

DSWD started releasing aid in March. Some 1.8 million Pantawid Pamilyang Pilipino Program (4Ps) beneficiaries receiving government assistance through cash cards. Around 5 million beneficiaries have received aid from DSWD through partner bank Land Bank of the Philippines.

P200 ‘only’ for TRAIN

Another official said that the P200-monthly subsidy would only be enough to offset the higher prices of basic goods under TRAIN.

“The P200 is enough to cover the [effects of TRAIN] but there are other factors as well such as issues with rice and higher fuel prices,” Finance Assistant Secretary Tony Lambino said in a mix of English and Filipino on Friday.

The country’s inflation rate reached 4.6% in May, a new 5-year high. Economic managers maintained, however, that the inflationary impact of TRAIN is not substantial.

Lambino also reiterated the government’s position against suspending TRAIN. “The contribution of TRAIN to higher prices is only small. Suspending TRAIN will not solve the problem, but we will also lose the benefits,” he said.

He urged Congress to pass the rice tariffication law which, he said, would help lower rice prices.

Under the measure, the prescribed rice  import volume would be removed and imports can eventually be opened to private traders. The measure is expected to will lower rice prices and increase revenues for agricultural programs like crop diversification.

“The most important thing that we need to do is to [pass] the rice tariffication because it will cause prices to go down to around P7 per kilos. Hopefully, Congress will pass the [bill] because it will help bring down inflation rates within the year,” Lambino said.

The TRAIN law has increased the take-home pay for most employees but has also jacked up prices of cars, fuel, tobacco, and sugar-sweetened beverages. (READ: [OPINION] Train law: What does it change?)

To help mitigate the effects of higher prices of goods in the next two years, government assistance to poor families will be increased from P200 to P300 a month. The budget department had earmarked P38.5 billion for this intervention in the proposed 2019 budget.– Rappler.com

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Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.