Millions left out of Covid loan-funded aid programs
THE Covid-19 social protection programs financed through loans from the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), and Japan International Cooperation Agency (Jica), excluded millions of Filipinos and small businesses during the lockdowns, according to a report by Socialwatch and Oxfam.
Based on the report, Socialwatch and Oxfam traced the exclusion from three key social protection programs to red tape and the focus on the assistance for formal sector participants.
The programs were the Covid-19 Adjustment Measures Program (CAMP) for workers through the Department of Labor and Employment (DOLE); Small Business Wage Subsidy (SBWS) for micro, small, and medium-sized enterprises (MSMES) through the the Social Security System (SSS) and the Department of Finance (DOF); and the Social Amelioration Program (SAP) under the Department of Social Welfare and Development (DSWD).
“The pandemic clearly presents the urgent need to review existing social policies and programs of the government and the possibility of expanding its coverage to a larger population, beyond what they currently cover. In time of a pandemic, casting the net wider would be the most humane, caring thing to do,” the report stated.
The three programs were financed by the $2.5-billion Covid-19 Active Response and Expenditure (CARES) financed by a $1.5-billion debt from the ADB; a $498-million borrowing from Jica; and a $750-million loan from the AIIB.
The CAMP targeted all establishments, from micro to large, affected by the pandemic and gave a one-time financial aid of P5,000 to qualified workers. The SBWS was target-specific, with 1 million MSMES on its radar of beneficiaries of the wage subsidy of P5,000P8,000 a month for two months.
The Social Amelioration Program provided a subsidy of P5,000 to P8,000 a month for two months to affected families and individuals.
“Everyone has been adversely affected one way or another; others more severely in terms of loss of jobs and incomes, additional family expenses, greater exposure to health risks, expanded family obligations, constrained access to services, to name a few,” the report, however, stated.
The report found that CAMP turned away nearly a million workers by the end of the application period in mid-april 2020. Socialwatch and Oxfam noted that this was a time when wage earners struggled with income losses daily.
Socialwatch and Oxfam traced the low payout to the fact that employers waited for their employees to apply through their online application system. Employers had to apply on behalf of their employees to qualify for the assistance.
As for the SBWS, the report found that the program only reached 146,000 MSMES and 3.59 million workers, barely 15 percent of its goal.
The two organizations also said the SBWS was “structurally biased” as it only catered and released assistance to businesses registered with the Bureau of Internal Revenue (BIR) and the Social Security System (SSS) and have met their financial obligations to these two agencies for the last three years up to 20 January 2020.
“By design, [SBWS] is inherently and structurally biased against informal MSMES which are generally not BIR- and Sss-compliant,” the report said. “In short, the SBWS has had very limited reach of the sector that it aspired to serve because it confined its scope to the regulated MSMES.”
Meanwhile, the P200-billion SAP distributed anywhere from P5,000 to P8,000—depending on the locality’s minimum wage rate—in two fund tranches in April and May 2020.
However, for the second tranche, at least 2.7 million families were excluded from the emergency cash assistance while some 200,000 beneficiaries were found to be ineligible.
The report added that only 3.2 million families of the 5-million waitlisted families that were left out in the first tranche, and were supposed to be included in the second tranche, were enlisted in the program.
The report also claimed that at least 842,014 families received duplicate assistance. These families were identified after they were cross-matched with databases of the DSWD’S Emergency Subsidy Program and Pantawid Pamilyang Pilipino Program (4Ps).
The data was also cross matched with the DA’S Financial Subsidy to Rice Farmers (DA-FSRF), DOLE’S Covid-19 Adjustment Measures Program (DOLE-CAMP), and the Department of Finance’s and Social Security System’s Small Business Wage Subsidy Program (DOF-SSS-SBWSP).
“The SAP’S second tranche was distributed only in areas that remained under the enhanced community quarantine [ECQ] classification,” the report stated.
“This effectively excluded millions of first-tranche recipients who live in non-ecq areas but nonetheless are part of the targeted 18 million families considered to be at risk of going hungry and impoverished due to loss of livelihood and incomes,” it explained.
The social protection programs of the government aimed to address the financial difficulties of Filipinos which peaked when the government implemented the Enhanced Community Quarantine (ECQ) in 2020.
Official government data from the Philippine Statistics Authority (PSA) showed the unemployment rate shot up to 17.6 percent while underemployment increased to 18.9 percent in April 2020.
The country’s employment rate declined to only 82.4 percent in that month. The Labor Force Participation Rate hit a record low of 55.7 percent in April 2020.
Socialwatch and Oxfam said the hardships of Filipinos were also compounded by the lack of Covid-19 test kits, making these prohibitive. Further, hospitals were barely able to contain the surge in coronavirus cases.