Philippines approves 50bil peso pay subsidy for middle-income workers

As the Philippine government allots billions of pesos in aid for the poorest families and low-income workers reeling from the Luzon lockdown, some local governments with enough resources are finding ways to fill the gaps. In Pasig City, parents of public school students on April 14 received 400 pesos worth of food coupons, which they can use at selected public markets. - PI/ANN

MANILA (Philippine Daily Inquirer/ANN): President Rodrigo Duterte approved a 50.8bil peso wage subsidy programme for workers at micro, small and medium enterprises (MSMEs) on Monday (April 13) after he expressed reservations about a Senate proposal to include more than 5 million families in the government’s social amelioration programme.

The cash aid will benefit some 1.6 million small businesses in the formal sector and their combined 3.4 million employees whose livelihoods have been disrupted by the Luzon lockdown.

“This is the answer to our middle-income workers, ” Cabinet Secretary Karlo Nograles said on Tuesday.

“If you recall, the President ordered (Finance Secretary Carlos) Dominguez (III) and their team to study what can be given to the middle-income (earners) as benefits, ” he added.

But Dominguez on Monday said the financial assistance to MSME workers was not for the middle class.

He reiterated that those belonging to the middle class were already benefiting from loan moratorium, extension of tax filing and payment deadlines, and disallowing banks to charge interest on housing and credit card debts.

Nograles, spokesperson for the Inter-Agency Task Force on Emerging Infectious Diseases (IATF), said Duterte approved the proposal of the Department of Finance for MSMEs on Monday night.

The Small Business Wage Subsidy Programme involves a 5,000-8,000 peso wage subsidy in two tranches to be paid out in May to employees of small businesses.

In the Philippines, MSMEs are defined as businesses with an asset size of 3mil pesos to 100mil pesos, excluding land assets, and with less than 200 employees.

MSMEs comprise almost 99 per cent of business establishments and account for 60 per cent of the country’s total employment.

Nograles said the amount of subsidy would depend on the minimum wage of the region, similar to what was implemented in the 200bil peso social amelioration programme for 18 million poor families.

To qualify for the subsidy, the employee must have been hired as of March 1 and is no longer receiving pay from the employer.

The wage subsidy covers all employees, except those who are on leave and those who have already availed themselves of Social Security System (SSS) unemployment benefits.

Nograles said the government wanted to retain the employment status of MSME workers by providing them a wage subsidy to be paid out in two tranches: from May 1 to 15 and from May 16 to 30. - Philippine Daily Inquirer/Asia News Network