Saturday, August 8, 2020

Sen. Gatchalian Bats For Business Loan Program To Curb Unemployment

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Senator Win Gatchalian is urging the government to carry out a subsidy program similar to the Paycheck Protection Program of the United States to prevent further lay-offs in the country as quarantine measures take a huge bite out of businesses’ bottom line.

The Vice Chairman of the Senate Committee on Economic Affairs explains that a Paycheck Protection Program is a loan program designed to provide incentive for small businesses to keep their workers on the payroll. Business owners can get full loan forgiveness as an incentive as long as the funds are used for eligible expenses. This way, the company gets to retain its employees while maintaining its operations.

“If we can include this in the Bayanihan 2, malaking bagay po ito sa ating mga employees, and also for our companies. Marami talagang kumpanya na nagda-downsize at sigurado akong mas marami pa ang mawawalan ng trabaho. Tiyak babalik din sila sa gobyerno, sa LGU o sa national government. Hindi na yan kakayanin ng gobyerno. Babalik at babalik sila sa gobyerno para humingi ng suporta,” Gatchalian explained.

“A Paycheck Protection Program-like subsidy will hit two birds with one stone. You secure the tenure of employees and at the same time you generate the economic side,” he added.

The government currently provides a wage subsidy of Php 5,000 to Php 8,000 to employees under the Small Business Wage Subsidy (SBWS) through the Social Security System (SSS). This scheme lets employers complete the application on behalf of their employees. But the lawmaker pointed out that this one-time subsidy does not provide long-term support to employees.

Many Filipinos were laid off as companies downsize their operations to trim their losses as they weather through the economic impact of the COVID-19 pandemic. The Philippine Statistics Authority (PSA) reported that 7.3 million Filipinos are unemployed as of April 2020, an all-time high unemployment rate.

Gatchalian warned of uncertain labor market recovery, citing the International Labour Organization’s (ILO) study that there was a 14% drop in global working hours during the second quarter of 2020, equivalent to the loss of 400 million full-time jobs, based on a 48-hour working week. The same study projects a decrease in working hours of 4.9% in the second half of the year which is equivalent to the loss of 140 million full-time jobs.

Meanwhile, Gatchalian has reiterated his call to prioritize the preservation of jobs in the country. The senator said the government will need an estimated Php 301 billion to create direct and indirect jobs for those impacted by the COVID-19-induced economic crisis for the rest of the year.

“The government has been calling for Filipinos to help spur the economy by spending more and taking advantage of record-low interest rates. But how can Juan dela Cruz think of spending his hard-earned cash during this crisis when he isn’t sure whether he’d be able to keep his job the following day. That’s why I implore the government to prioritize the preservation of jobs of our kababayan so that they’ll be able to contribute in reviving our economy back,” he said.

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