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Consumers demand cash aid, wage hike as more oil price increases loom

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A network of consumers’ rights advocates demanded that government continue with the roll out of its promised aid to families severely affected by recent spikes in prices of goods and services.

The Samahan at Ugnayan ng mga Konsyumer para sa Ikauunlad ng Bayan (SUKI Network) said their demand for cash assistance for affected families, transport workers, small businesses and producers are unchanged despite the rollback in oil prices this week.

The group also pressed the government to implement salary increases and reduce prices by scrapping oil excise taxes to help poor families recover from pandemic consumer woes.

SUKI Network is composed of organizations of poor sectors such as drivers, the urban poor, workers, farmers, small entrepreneurs, academics, church people, advocates of the right to food and basic needs, social services, public utilities, among others.

Kalipunan ng Damayang Mahihirap (Kadamay) officer Eufemia Doringo said such demands are just as they see further increases in prices of goods and services as another round of oil prices loom nest week.

“Transport workers with the Pinagkaisang Lakas ng Tsuper at Opereytor Nationwide (PISTON) say they are far from recovered with the Php11.45/liter rollback. They have lost income from 11 consecutive weeks of oil price increases this year exceeding Php30.00,” Doringo said.

Doringo reported that in the urban poor community of Sitio San Roque, Barangay North Triangle, Quezon City, rice is being sold at Php35-36/kilo, pork bones at Php250-300/kilo, dried fish at Php10-20/piece, cabbage at Php50-80/piece and sugar at (Php53-Php70/kilo.

Consumer rights advocate Bantay Konsyumer, Kalsada at Kuryente (BKKK) also criticized increased electricity rates it said would impact so-called lifeline consumers.

BKKK convenor Prof. Louie Montemar said the government should consider using the Malampaya funds to subsidize electricity rates and offset the new Php0.0625 per kilowatt hour (kWh) increase, bringing rates to Php9.6467 per kWh.

Government shows lack of control

Ariel Casilao of Anakpawis meanwhile said that the rollback indicates price manipulation on the part of oil cartels.

“They easily announced a rollback after raking super-profits from the total several weeks’ hike of up to Php30.75 per liter in the price of diesel, up to20.50 for gasoline and PHp24.90 for kerosene,” Casilao explained.

The former legislator said the rise and fall in oil prices also shows government’s lack of control of the oil industry under the Oil Deregulation Law.

“As long as deregulation is in place, the nation and the public are at the mercy of giant oil companies’ opaque pricing schemes. The unbundling of the price of petroleum products in the recommended amendments to the deregulation law would be welcome,” Casilao said.

The SUKI network said it demands the unbundling of petroleum product prices, scrapping of the oil excise tax and Oil Deregulation Law, Php10,000 cash assistance for the 18 million poorest households, Php15,000 subsidy to producers, substantial support for small local businesses, and a Php750 national minimum wage.

Collect Marcoses’ unpaid taxes

The network said Duterte’s recent order to increase its monthly financial aid to the poorest Filipino families affected by oil price increases from Php200 to Php500 still only amounts to just Php16.67 per day.

It also cited figures from economic think tank IBON Foundation that the real value of the minimum wage has fallen from Php536.74 in 2016 to Php494.02 in February 2022.

According to IBON, the living wage is now at Php1,072 per day or Php25,252 per month for a family of five in the National Capital Region.”

“The argument that there aren’t funds for the people’s demands is worn and torn,” SUKI Network spokesperson Prof. Reginald Vallejos said.

“IBON has shown that if the Duterte government really wants to help its constituency, it can reallocate the trillions it budgeted for big-ticket infrastructure, debt servicing, and military and police modernization; recover tax cuts given to big corporations; and tax the bilionaires,” Vallejos said.

Kadamay’s Doringo added that the government must also decisively collect Php203 billion estate tax arrears of the heirs of the late dictator Ferdinand Marcos as additional source of funds for its cash aid roll out.

“Instead of letting them go scott-free while tens of thousands of small businesses are forced to close due to lack of government support, the Marcoses should be obliged by government to face the law and pay up”, Doringo said. # (Raymund B. Villanueva)

Public workers demand relief after ‘unbearable’ price hikes

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Government employees are demanding for salary increases and economic relief in light of rising prices of oil and basic goods and services.

“As the Duterte administration recently announced it is considering increasing national minimum wage of private sector workers, government workers also called for similar minimun pay increase and economic relief to cushion the impact of rising  prices of oil and basic commodities,” the Confederation for Unity, Recognition and Advancement of Government Employees (COURAGE) said.

COURAGE president Santiago Dasmarinas said the purchasing power of public sector workers had already been severely eroded by inflation even before the pandemic.

“With the big increase in oil prices recently, which would surely result to price increases in basic commodities, government employees can no longer bear the economic hardships they are experiencing,” Dasmarinas said.

The group said that to mitigate the poor conditions of government workers, the government must:

* Raise the national minimum wage of government workers to P16,000 per month as proposed in House Bill (HB) 6362 filed by the Makabayan bloc in Congress;

* Provide for a monthly inflation adjustment allowance of P3,000 as proposed in HB 9922 by Makabayan;

* Implement an extended and expanded social amelioration package for  workers and the general public who are suffering more because of high inflation;

* Remove excise and value added taxes on oil products and impose price control measures; and

* Implement humane working arrangements and policies to alleviate workers’s conditions.

COURAGE said low salary-grade employees, local government workers, government-owned and controlled corporation workers, contract of service and job order workers, have been short-changed by the existing salary standardization law and the government’s compensation and position classification system that made them ill-prepared to deal with the inflation brought about by the pandemic and rising oil prices. # (Raymund B. Villanueva)

Higher inflation for poorest Filipinos underscores urgent need for continued cash subsidies

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by IBON Media & Communications

Research group IBON said that the higher inflation is problematic but particularly burdens the poorest Filipinos. Inflation rates for the 30% poorest households are higher than the national average.

Especially amid historic joblessness, this affirms how the government should continue giving cash subsidies as income support, the group said.

According to the Philippine Statistics Authority (PSA), headline inflation rose to 2.5% in June 2020 from 2.1% in May 2020.

Behind this uptick are price increases in: transportation, particularly tricycle fares; alcoholic beverages and tobacco; housing, water, electricity, gas, and other fuels; and communication.

However, the 3.0% inflation rate in June for the poorest 30% of households was higher than the headline inflation rate of 2.5 percent.

This means that the cost of living is rising fastest for the country’s poorest households.

IBON said that this is troublesome for millions of poor families suffering interrupted incomes and stingy emergency relief. 

IBON said that the rise in inflation despite repressed consumption during the lockdown is worrying and points to problems in supply and production.

The government is primarily responsible for ensuring these especially during a public emergency.

For instance, the group said, the notable increase in the transport index shows the government’s weakness in ensuring this vital public service.

Rising prices especially for the poorest affirms the urgency of continued income support, IBON said.

The number of beneficiaries getting the second tranche of emergency subsidies should not be limited. The 18 million poorest Filipinos, including the 5 million wait-listed beneficiaries of the Social Amelioration Program, should receive both the first and second tranches of the Php5,000-Php8,000 per-month emergency aid, said the group.

The government said that only those residing in enhanced community quarantine (ECQ) and modified ECQ areas will be getting a second tranche.

This is only 8.6 million families of the original 18 million target beneficiaries, and 3.5 million households of the five million wait-listed.

This also means that 10.6 million beneficiaries now in general community quarantine (GCQ) and modified (MGCQ) areas will have to make do with just their first tranche.

With the cost of living fast rising amid an even worsening pandemic, limiting the number of beneficiaries getting the second tranche of emergency aid is unconscionable, IBON said.

The government should even consider additional tranches for vulnerable households that continue to reel from lost livelihoods and income, said the group. #

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Kodao publishes IBON articles as part of a content-sharing agreement.

Inflation slowing due to a sluggish economy — IBON

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by IBON Media

Research group IBON said that despite reported slower inflation, daily expenses are still rising and too expensive for the majority of Filipinos who suffer low and stagnant incomes.

The group also said that slowing inflation mainly reflects a slackening economy.

The Philippine Statistics Authority (PSA) reported lower nationwide inflation at 0.8% in October 2019 from 0.9% the previous month and 6.7% in October last year.

Meanwhile, National Capital Region (NCR) inflation increased to 1.3% in October 2019 from 0.9% in September 2019 but was lower than the 6.1% inflation in October 2018.

The uptick in NCR inflation was due to higher annual inflation in alcoholic beverages and tobacco, food and non-alcoholic beverages, and clothing and footwear.

IBON executive director Sonny Africa said that lower inflation is generally better for poor and low-income consumers as slower price increases will weigh less on low wages and incomes.

He noted however that lower reported inflation is from a high base last year when prices dramatically rose. Yet some food items are still more expensive now than last year.

In Metro Manila, for example, the cost of pork, chicken, fish, eggs and many vegetables in the last week of October 2019 was much higher than in the same period last year.

The price of pork increased by Php50; chicken by Php30; tilapia by Php20; string beans by Php20; and potato and native pechay by Php15. Rice is a notable exception in being slightly cheaper.

Africa said however that the majority of Filipinos’ incomes are still far below what is needed to live decently and still eroding further despite reportedly lower inflation.

In NCR for instance, the real value of the minimum wage or taking inflation into account is actually lower today compared to November last year.

Measured at 2012 prices, the real value of the Php537 NCR minimum wage has fallen to Php453 today from Php459 in November 2018.

It is also likely that inflation is slowing because the economy is slowing from faltering investments, stalling infrastructure spending, and the global economic slowdown, said Africa.

So far under the Duterte administration, gross domestic product (GDP) growth has declined from 6.9% in 2016 to 6.7% in 2017 and 6.2% in 2018. The 5.5% growth in the second quarter of 2019 is the lowest in 17 quarters.

Foreign direct investments shrank by 39.8% from US$6.8 billion in January-July 2018 to US$4.1 billion in the same period in 2019.

Meanwhile, infrastructure spending growth contracted from 45.9% in January-September 2018 to -4.3% in the same period this year.

Africa said that lower inflation alone is meaningless if Filipinos especially the poor continue to be burdened with high prices and little to no incomes. The government should not ignore this nor the signs of a slowing economy.

Immediate steps for government should include supporting and developing domestic agriculture, as well as substantially increasing wages and salaries to give relief to Filipino households, Africa said. #

(Kodao publishes IBON.org’s reports and analyses as part of a content-sharing agreement.)

2018 inflation highest in 10 years amid slowing growth — IBON

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Inflation for 2018 is more than double the Duterte administration’s original inflation target for the year and the highest in a decade, research group IBON said.

Along with slowing economic growth, this further points to the failure of government’s economic managers to rein in consumer prices and of its neoliberal policies, such as the Tax Reform for Acceleration and Inclusion (TRAIN), which continue to burden the poorest Filipino families, said the group.

The reported annual average inflation rate rose to 5.2 percent in 2018 from 2.9 percent in 2017 and 1.6 percent in 2016.

IBON noted that this is much higher than the government’s original annual inflation projection of two to four percent for 2018 and the highest since the 8.2 percent rate in 2008.

Aside from missing its inflation target, the government is also facing an economic slowdown.

The economic growth target for 2018 has already been adjusted downwards from 7-8 percent to 6.5-6.9 percent.

The gross domestic product growth rate already slowed to 6.3 percent in the first three quarters of 2018 from 6.7 percent in 2017 and 6.9 percent in 2016.

Inflation eased last December to 5.1 percent but the poorest half of the population still saw their real income erode by anywhere from Php3,300 to Php7,300 from the high inflation throughout 2018.

Rising prices always spell more difficulty for the poor especially amid low or even stagnant incomes, IBON said.

The Duterte administration should also not be too quick to take credit for the lower year-end inflation, IBON added.

The biggest factor easing inflation is not anything the government has done but rather falling global oil prices from increased supply amid a global economic downturn.

On the contrary, the Duterte administration’s insistence on TRAIN’s second tranche of fuel excise taxes adds inflationary pressure, the group said.

The economic managers will fallaciously claim that relatively slower inflation in the first few months of 2019 proves that TRAIN and the additional fuel excise taxes are not inflationary, IBON said.

Such dismissiveness of how TRAIN makes consumer goods and services more expensive however only affirms the government’s insensitivity to the plight of the Filipino people, especially the poor.

IBON said that poor Filipino families worst affected by last year’s high prices will continue to carry the burden of these into the new year if government does not take genuine measures to curb inflation and arrest a faltering economy.

The government can start with repealing TRAIN and implementing a progressive tax system. #

High prices still burden poor despite inflation slowdown

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On the release of the November 2018 inflation rate, research group IBON said that prices are still high and rising even with the reported slowdown.

This remains a burden on poor families trying to live off low and precarious incomes. Substantial and longer-term solutions are still needed, said the group.

Headline inflation slowed to 6.0 percent in November from 6.7 percent last month.

Inflation slowed in food and non-alcoholic beverages; housing, water, electricity, gas, and other fuels; and communication.

Inflation however worsened in the rest of the commodity groups. Additionally, year-on-year inflation is still double the 3.0 percent rate in November 2017.

IBON stressed that prices are still higher than before due to the inflationary impact of the Tax Reform for Acceleration and Inclusion’s (TRAIN) consumption taxes, rising global oil prices and the peso depreciation.

Rice, fish, meats, fruits, vegetables and other basic commodities are still more expensive now than a year ago.

The majority of Filipino families who have low incomes are burdened the most. Inflation has eroded the incomes of the poorest 60 percent households by a total of Php2,650 to as much as Php7,000 from January to November of this year.

The Php537 minimum wage in the National Capital Region is the highest nationwide but even this falls far short of the estimated family living wage of Php1,002 for a family of five.

Meanwhile, some 2.5 million of the target 10 million beneficiaries of TRAIN’s unconditional cash transfers (UCT) have still not received anything almost a year into TRAIN.

The Duterte administration’s economic managers said that slowing inflation “suggests” the effectiveness of government’s anti-inflationary measures such as Administrative Order No. 13 removing barriers to agricultural imports.

IBON executive director Sonny Africa disputes this: “The government is too quick to take credit and too dishonest to accept blame.”

“The inflation slowdown may even be due more to falling global oil prices since October than the Duterte administration’s half-hearted anti-inflation measures,” he said. “On the other hand, government refuses to accept how the higher taxes from TRAIN have driven prices up and will do so again in less than a month.”

Africa said that government’s decision to push through with the next tranche of fuel excise taxes next month in January 2019 shows its insensitivity to the plight of millions of poor Filipinos.

He said that real steps to curb inflation begin with stopping TRAIN, and giving meaningful support to domestic agriculture and Filipino industry. #

 

TRAIN Package 1A: From the poor to the rich

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Government’s continued implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) means that TRAIN’s taxes will keep raising prices next year and make inflation higher than it should be.

Read: TRAIN still inflationary with lifting of fuel excise suspension

TRAIN still inflationary with lifting of fuel excise suspension

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Research group IBON said that government’s continued implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) means that TRAIN’s taxes will keep raising prices next year and make inflation higher than it should be.

The group said that lifting the fuel excise tax suspension shows the Duterte administration’s insincerity and insensitivity in addressing the inflationary impact of the tax reform program, particularly on poor Filipino households.

The administration’s interagency Development Budget Coordination Committee (DBCC) recently announced its plan to recommend that the second tranche of fuel excise tax be implemented, backpedaling on its previous suspension proposal.

The DBCC cited the lowering of Dubai crude oil prices and consideration of possible foregone revenues as reasons for its latest recommendation.

IBON however said that not going through with the suspension means new inflationary pressure next year from the second round of oil excise taxes in January 2019 on top of the now built-in additional prices from the first round in January 2018.

The liquid petroleum gas (LPG) excise tax of Php1.00 per kilogram (kg) in 2018 increases to Php2.00/kg in 2019, and Php3.00/kg in 2020. Diesel excise tax of Php2.50/liter in 2018 increases to Php4.50/liter in 2019, and Php6.00/liter in 2020.

Kerosene excise tax of Php3.00/liter in 2018 increases to Php4.00/liter in 2019 and Php5.00/liter in 2020.

The gasoline excise tax meanwhile is set to increase from Php7.00/liter in 2018 to Php9.00/liter in 2019 and Php10.00/liter in 2020.

IBON said that another fuel excise tax hike further increases costs of production. This will create a domino effect that will sustain the high prices of goods and services that many Filipinos, especially the poor, suffered this past year.

IBON estimates that the poorest 60 million Filipinos have already endured real income losses of anywhere between Php2,500 to Php6,800 due to worsening inflation since the onset of 2018.

The group added that it is premature to think that oil prices are going to stay low or that the peso will not continue to depreciate.

Oil prices remain volatile and could still increase next year with US sanctions on Iran gaining traction, possible Organization of Petroleum Exporting Countries (OPEC) production cuts, and untoward geopolitical events.

IBON insisted that the administration can do much to moderate inflation by suspending the inflationary taxes of TRAIN package 1.

IBON said that government should stop imposing higher consumption taxes such as the fuel excise which burdens the majority of poor Filipinos who can ill afford this amid low wages and growing joblessness. 

 

Instead, the government should improve revenue collection by cracking down on tax evaders and corruption in the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC). 

 

It should also build a tax system that raises revenues more from higher income, wealth and property taxes on the rich.#

Bayan Muna proposes free funeral services for ‘extremely poor’ families

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Bayan Muna called for the fast-tracking of a bill aimed at giving substantial discounts for funeral services for the poor.

As high inflation rates affect even the dead, House Bill 3028 should be immediately passed to give indigent families a 50 percent discount in funeral services, Bayan Muna explained.

Authored by Bayan Muna Representative Carlos Isagani Zarate, the proposed measure aims to alleviate the rising costs of services due to the Rodrigo Duterte government’s Tax Reform for Acceleration and Inclusion (TRAIN) law, the group added.

“Hindi lang mga buhay ang nasasagasaan ng TRAIN, pero pati mga patay na rin. Sa minimum ay tumaas ng P1,000 ang funeral services sa ngayon, hindi pa kasama dito ang kabaong, lupa sa sementeryo at mismong pagpapalibing,” Zarate said.

“Our bill also mandates that dead persons belonging to ‘extremely poor’ families should be given free funeral services,” he added.

The government announced that inflation rates in the third quarter of the year has risen to more than six percent, driving prices of goods and services higher.

Bayan Muna said the House of Representatives shall tackle the proposed measure when it resumes its session this month.

“We hope that the House leaders would also fast track the bill’s passage so that poor families would not have to shell out more just to bury their loved ones. They are already grieving from their lost, it is doubly tragic that they should also be burdened to bury their dead,” Zarate said. # (Raymund B. Villanueva)

Suspend rate hike, scrap concession agreement with water firms, govt told

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The Water for the People Network (WPN) said that government should not accede to the ruling of an international arbitral court granting the Maynilad Water Systems, Inc. petition to collect its corporate income tax (CIT) from consumers. 

The water rights group agreed that any impending water rate increase amid the ongoing dispute on pass-on CIT should be deferred.

The group likewise urged the scrapping of the concession agreement (CA), which it said allows onerous grounds for price hikes.

The Singaporean Supreme Court finalized an International Chamber of Commerce (ICC) arbitration decision that Maynilad may recover its CIT through pass-on charges.

Maynilad has demanded that the Philippine government pay Php3.4 billion in indemnification for non-recovery of its CIT for the period March 11, 2015 to August 31, 2016.

This is after the Metropolitan Waterworks and Sewerage System Regulatory Office (MWSS-RO) refused to honor an arbitral decision favoring Maynilad while that for Manila Water remained pending.

As per CA with the Philippine government, both Maynilad and Manila Water took to international arbitration in 2013 to contest the RO’s rejection of their petitioned rate increases for the rate rebasing period of 2013-2018.

The firms’ petitions included CIT recovery and other expenses unrelated to the delivery of water services.

For the period of 2018-2022, the MWSS Board has already approved the RO’s rate rebased tariffs, which again reportedly disallows CIT recovery. The MWSS-RO announced a staggered Php5.73 per cubic meter (cu. m.) rate increase for Maynilad and Php6.22/cu. m. for Manila Water.

These are lower than the firms’ petitioned rates, wich for Maynilad still included the CIT.

The WPN urged the MWSS Board in a letter to uphold the decision to prohibit CIT recovery because it is unjust to consumers.

“In the first place, it is very wrong to pass on the burden of paying the CIT to consumers,” said the group.

The concessionaires are technically public utilities providing a very basic need such as water, said WPN. Aside from mandating the periodic alteration of basic charges through rate rebasing, the CA ensures the concessionaires’ steady flow of revenue and profit-making with other increases based on inflation, an environmental charge, and value added tax, noted the group.

WPN supports the MWSS-RO plan to suspend the impending rate hike this year should Maynilad insist on collecting indemnification from the government.

“The amount being demanded by Maynilad alone could reach Php40 billion, tantamount to an increase of about Php5.00/cu. m. on current average tariffs. Any rate hike today is also insensitive due to the soaring prices of goods and services,” said the group.

Inflation has risen to 6.7 percent in September from 6.4 percent in August.

Aside from pushing for the prohibition of the CIT and rate hike suspension, WPN stressed that strategically, government should review and repeal the CA altogether.

 

“It is the basis of the enrichment of private water firms at the expense of consumers. Government should instead ensure control over water resources to have these safe, accessible and affordable for the public,” WPN said. #