The House Defeat COVID-19 committee approved two bills aimed at boosting the economy to cushion the effects of the pandemic, including a stimulus package worth around P1.3 trillion and providing aid for financial institutions.
On Tuesday, May 26, the panel members unanimously approved the still-unnumbered substitute bill or the proposed Philippine Economic Stimulus Act (PESA). (WATCH: LIVE: House committee for COVID-19 virtual meeting)
The PESA is designed to protect Filipino workers post-lockdown by ensuring businesses will continue operating while also reviving consumer confidence.
The P1.3-trillion fiscal package would be sourced from off-budget accounts or government agencies' income from operations. This is allowed under Republic Act No. 11469 or the Bayanihan to Heal as One Act, which gave President Rodrigo Duterte special powers to address the pandemic. (READ: What we know so far: Funding the fight vs the coronavirus)
The economic stimulus package also proposes to fund massive COVID-19 testing as well as provide wage subsidies and zero interest loans to micro, small, and medium enterprises. A total of P586 billion would be allotted for 2020, while P80 billion will be set aside in 2021.
Another P650 billion would be spaced out for 3 years starting 2021 to enhance the government's Build, Build, Build infrastructure program.
Of the P1.3-trillion fiscal package, a total of P20 billion would also be set aside for mass testing from 2020 to 2021, including purchasing more test kits, setting up additional testing centers, and strengthening contact tracing efforts down to the local level.
The bill states mass testing would be conducted in areas "where higher possibility of transmission of COVID-19 may occur or have occurred." (READ: ECQ alone won't curb coronavirus, PH needs mass testing – UP expert)
The PESA was primarily authored by economists-turned-lawmakers Marikina City 2nd District Representative Stella Quimbo and Albay 2nd District Representative Joey Salceda.
But House committee on economic affairs chairperson Sharon Garin said another 258 lawmakers agreed to be co-authors of the economic stimulus package.
Assistance for financial institutions
A few minutes after passing the PESA, the House panel also approved the still-unnumbered substitute bill or the proposed Financial Institutions Strategic Transfer (FIST) Act, primarily authored by House committee on banks and financial intermediaries chairman Junie Cua.
The FIST bill aims to assist banks and other financial institutions with offloading their debts and managing their non-performing assets (NPAs) affected by the pandemic.
Financial institutions would also be granted tax exemptions, and the registration and transfer fees of certain NPA transactions would be reduced.
Cua said in his explanatory note for the measure that it would encourage banks and financial institutions to sell their NPAs to asset management companies or financial institutions strategic transfer corporations (FISTCs) that specialize in the resolution of distressed assets.
"It encourages the private sector, government financial institutions, and government-owned or controlled operations to incorporate and invest in FISTCs and help in the rehabilitation of distressed businesses with the end view of contributing to economic growth," Cua said.
In the same hearing, the House panel also approved a measure banning the discrimination of frontliners and those who are considered as suspect, probable, and confirmed cases of COVID-19.
All 3 measures will now be brought to the House plenary on Tuesday afternoon for their respective sponsorships for 2nd and 3rd reading approvals.
The bills will have to go through another 3 readings in the Senate before they can be signed into law by Duterte. – Rappler.com