P45B wage subsidy program for 6M workers, small enterprises, freelancers proposed

THE chairman of the House committee on ways and means has proposed a P45-billion wage subsidy program to help nearly six million workers, small enterprises, and freelancers.

Albay Rep. Joey Sarte Salceda,  panel chairman, proposed the wage subsidy scheme dubbed as the Payroll Support for Workers, Entrepreneurs, and Self-employed (PSWES) Program to cover 5.98 million workers for small and medium enterprises, sole entrepreneurs, and freelancers, whose incomes have taken a hit during the six-week enhanced community quarantine (ECQ).

Salceda said these workers will likely face financial difficulties in the weeks after and the wage subsidy shall be distributed for three months.

“I wrote to President Duterte today (Saturday) to recommend to him that we begin calibrating a wage subsidy program for small and medium enterprises, as well as for those in the gig economy.  We will need these enterprises to operate, so it’s essential for the economy and for job preservation that we lend them a helping hand,” said Salceda.

In a note to President Rodrigo Duterte, Salceda wrote that “a payroll support program will likely be necessary to support micro-, small- and medium-enterprises (MSMEs) that will face liquidity issues in the wake of the enhanced community quarantine (ECQ), as well as their workers, who are at risk of being terminated if these MSMEs are unable to pay their wages and maintain operations.”

“Apart from supporting business, the program will also be able to provide relief to formal economy workers, entrepreneurs, and self-employed individuals, who typically belong to the middle class. Income support will also likely be necessary for freelancers and those in the gig economy who were unable to earn income due to the ECQ,” said Salceda.

By Salceda’s staff estimates, “micro, small and medium enterprises (MSMEs) employ around 4.1 million formal economy workers from the Bureau of Internal Revenue (BIR) data on small taxpayers. Some 380,000 entrepreneurs are sole enterprises (BIR). About 1.5 million Filipinos are freelancers (according to the 2018 Global Freelancer Insights Report.). Together, these sectors have a combined workforce of 5.98 million workers.”

“The average monthly minimum wage is around Php 9,500 per month. We propose a wage subsidy that covers around a quarter to a third of this amount. The cost of supporting their income, at P2500 to P3000 per month for two months, is P44.85 to P53.82 billion pesos,” said Salceda.

“I proposed that we distribute most of the aid via the Social Security System (SSS), assisted by the Bureau of Internal Revenue (BIR) and the Department of Labor and Employment (DOLE) for formal economy workers. For freelancers, I am proposing an open-application window similar to the Covid Adjustment Measures Program (CAMP) of DOLE,” Salceda added.

“I’m also proposing that we couple the open-application process for freelancers with cost-free BIR and SSS registration. That way, they are able to see the full benefits of being accredited with the state, while also being able to contribute in future years when they are in better conditions. Kumbaga, bigyan kita ng tulong ngayon, para kapag nakaluwag-luwag ka na, makatulong ka rin sa iba. We will need to expand the tax base when this situation normalizes. I think this will be a big part of that effort,” the House tax panel chair explained.

“As you know, I wrote HB (House Bill) 1527, which would essentially be a Magna Carta for the freelancers. There’s a lot of potential there if we can regularize that industry. Showing them the benefits of being part of the formal economy would be the ultimate invitation.” Salceda said.

Salceda is also co-chair of the House Stimulus Cluster, the panel tasked with drafting the House’s economic stimulus plan for transitioning out of, and recovering from Covid-19. Prior to the implementation of the Social Amelioration Program (SAP), Salceda also submitted a report to President Duterte that outlined modalities for an emergency subsidy for the poor and vulnerable sectors.

He led calls to enforce a lockdown on Metro Manila immediately following reports of community transmission in San Juan.

Salceda has also filed HB 6096, which seeks to create a Center for Disease Control and establishing special powers to address a health emergency as early as January.

He is also recognized as a leading advocate for disaster preparedness by international bodies such as the United Nations, where he was co-chair of the Green Climate Fund.

In a related development, Anti-Crime and Terrorism Community Involvement and Support (ACT-CIS) party-list Rep. Eric Yap, who chairs the House committee on appropriations, underscored the importance for the private sector to further strengthen its efforts in assisting the government to fight COVID-19.

Yap said the group has been donating personal protective equipment (PPEs) and other medical equipment to various hospitals and frontliners, extending financial assistance to those who are part of the informal economy, distributing relief goods to families most affected by the community quarantine, among others in different parts of the National Capital Region (NCR), Tarlac, Bulacan, Nueva Ecija, Mindoro, Davao, Bicol, Cagayan, and Isabela.

“Public Service – ito ang foundation ng ACT-CIS Partylist. May krisis man o wala, patuloy tayo sa ating serbisyo. Lalo ngayon na mas maraming hirap na ating kababayan, ating pinapalawak pa ang abot ng mabibigyan natin ng tulong. Goal natin na mas marami pa tayong matulungan na kababayan sa iba’t-ibang parte ng bansa,” said Yap.

"Ngayon tayo mas kailangan ng ating mga kababayan, hindi man natin kaya tulungan lahat ng tao, gagawin natin ang lahat ng ating makakaya para mapalawig ito. Hindi lang isa o dalawa o anim na buwang sahod ang ating nilalaan dito. Buhay na ng tao nakasasalay kaya wala ng halagang dapat pag-usapan dito," he added.

As the Legislative Caretaker of Benguet, Yap also took the initiative to ensure that the people of Benguet are provided with necessary aid.

Just last week, Yap said his group donated P2.5 million worth of PPEs and other essential needs to the health workers in Benguet General Hospital (BeGH).

Yap also donated 500 sacks of rice with 50 kilograms each as initial relief for distribution to the 13 municipalities of the province earlier this week.

“That’s only initial relief. Target natin na makapagbigay ng 500 sacks of rice every other week para siguraduhin na walang taga-Benguet na magugutom. Nakikipag-ugnayan pa tayo sa iba’t-ibang stakeholders kung paano pa tayo makakatulong sa ating mga kababayan sa Benguet,” said Yap.

To help reduce the impact of the crisis to the farmers, Yap also bought the vegetable produce of Benguet farmers, to be distributed as relief to families in need.

“Para sa ating farmers, binili rin natin ang kanilang ibinibentang gulay sa tamang halaga. Itong mga binili natin na gulay, ipapamigay rin natin sa mga may kailangan pa ng relief. Dahil sa community quarantine, nagging limitado ang pagbebentahan nila ng gulay. Hangad natin na maging self-sustaining pa rin sila sa kabila ng krisis,” said Yap.