AS skyrocketing food prices can result in 2.58 million more poor Filipinos, economist-lawmakers are considering the grant of special powers to President Ferdinand Marcos Jr. in order to curtail inflation.
Speaker Martin Romualdez, House Committee on Ways and Means Chairman Joey Sarte Salceda and House Committee on Appropriations Senior Vice Chairperson Stella Luz Quimbo said the lower chamber is working with the President’s economic team to control the increase in consumer prices.
Lawmakers said this following a briefing given by members of the Development Budget Coordination Committee (DBCC) on the impact of inflation on national government programs, activities and projects.
“I stand by my bill granting special powers for the President to curtail inflation. This has long been my call—and it is especially more urgent now that the causes of inflation are more evidently structural,” said Salceda.
Monetary tools exhausted
“The economic managers themselves have stated that we have more or less exhausted what monetary policy can do to reduce prices. The causes are now mostly structural—so the solutions should also be,” he added.
Salceda earlier filed the proposed Bayan Bangon Muli package that integrates a significant number of special powers to curtail price increases—short of price controls, which would of course be more harmful than do any good for supply stability.
Salceda proposed to include in the Bayan Bangon Muli package the anti-hoarding powers, powers
to incentivize production, powers to provide loans and guarantees to suppliers of essential goods, anti-price-gouging powers, motu proprio powers to investigate market abuse, transport emergency powers, and power to mobilize uniformed personnel to expedite programs and projects.
Under his proposal, the BBM bill will have a validity of 18 months. “Within those 18 months, the President can invoke certain powers, the duration of which he can decide, as long as it falls within those 18 months.”
For her part, Quimbo highlighted Congress’s role in resolving the country’s economic issues.
“There are more nuanced questions such as: Should Congress insist on the re-convening of the interagency unit on economic intelligence to intensify enforcement against agriculture cartels which have been engaged in hoarding and price manipulation?” asked Quimbo.
“Should Congress grant the Department of Agriculture or the President additional powers to enforce food price stabilization measures? If so, what are these?” Quimbo added.
Quimbo said her colleagues have other issues to raise, but perhaps the most important question is this: “How can Congress help to control inflation or the rise of prices, especially of food?”
P11.9 billion subsidy
Quimbo also suggested that economic managers tap the potential P11.9-billion additional collection from value-added tax (VAT)—derived from higher prices of goods in January—to help Filipinos amid increasing food prices.
In a statement at the DBCC briefing, Quimbo called for the immediate distribution of cash aid or ayuda as skyrocketing food prices can swell by 2.58 million the ranks of poor Filipinos.
The economist-lawmaker said this P11.9-billion additional collection from VAT can be used to help Filipinos cope with high inflation.
Quimbo cited an ADB study which estimated that 10-percent food inflation rate pushes an additional 2.3 million into poverty.
“With an 11.2-percent food inflation rate that we are currently experiencing, the number of poor Filipinos has risen by 2.58 million,” Quimbo said.
According to her, the inflation rate is an important budget planning parameter for a number of reasons.
“An increase in prices of commodities affects the collection of value-added taxes. The BESF [Budget of Expenditures and Sources of Financing] indicates that a 1-percentage point increase in inflation yields an additional 30.4 billion pesos in revenues per year or about 2.53 billion pesos per month,” he said.
“Higher prices, especially food prices, push more people below the poverty line…Food price increases were the biggest single source of inflation, contributing 4.8 percentage points out of the total 8.7-percent inflation rate,” she added.
Quimbo added that due to high prices, local producers are also taking the brunt of weaker production which will eventually affect jobs.
The DBCC briefing has initiated the harmonization of efforts of the executive and legislative branches in tempering inflation and in achieving the Medium-Term Fiscal Framework’s (MTFF) poverty reduction targets.
Speaker Romualdez said the House is working with the Marcos administration’s economic team on measures aimed at controlling inflation.
“Of course, one of the pressing issues [facing the economy and the nation] is the inflation rate. This is a global phenomenon. But again, hearing from you [today] would be a very, very good thing for us to prioritize. Again, I reiterate the Congress’ willingness to work hand-in-hand, to be marching in lockstep with the executive in pursuing the solutions to the economic challenges that the country faces,” Speaker Romualdez said.
Earlier, Marcos had predicted that inflation would soon go down.
Romualdez said he had asked the House appropriations committee to hold an oversight hearing “to see how Congress and the economic managers can work together, pursuing our President’s whole of government approach to addressing problems of our economy.”
“We are here together to see how we can work hand-in-hand and we’d like to very much hear from our economic managers how we can engage and make sure that our functions here in the Congress would become more meaningful, more responsive to the needs of the Filipino people,” he said.
“This is our mission, thus is the order of our President, Ferdinand R. Marcos Jr., to make sure that the lives of Filipino people are much better, that they be more comfortable, safer,” he said.
The House leader thanked DBCC members—Secretaries Benjamin Diokno of finance and Amenah Pangandaman of budget, Bangko Sentral ng Pilipinas Gov. Felipe Medalla, and National Economic and Development Authority Director General Arsenio Balisacan—for briefing House members.
“We look forward to more of these meetings and engagements,” the Speaker told his colleagues and the President’s economic managers.
For her part, Budget Secretary Amenah Pangandaman said the Marcos administration was preparing at least P9 billion for Conditional Cash Transfer.
Image credits: PNA/ Rey S. Baniquet