Senators slam agencies over high inflation

MANILA, Philippines – Lawmakers questioned several government agencies over their supposed lack of urgency in addressing the needs of the poor amid the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law this year.

During the 3rd public hearing on the matter, Senate economic affairs committee chairman Sherwin Gatchalian slammed the Department of Social Welfare and Development (DSWD) for the slow disbursement of unconditional cash transfers for the poor. 

Gatchalian also criticized the National Food Authority (NFA) for failing to bring rice prices down.

The cash assistance from the government is meant to insulate the poorest Filipinos from the inflationary effects of TRAIN. However, the funds have yet to be given to all families 6 months after the law's implementation began.

The DSWD said all funds will only be disbursed to families by September.

Meanwhile, the NFA’s buffer stocks were depleted, which pushed regular rice prices even higher.

Due to enforcement issues, Gatchalian said senators are poised to assess whether the next batch of tax increases under TRAIN would be implemented in 2019.

"Lahat na-delay. So magkakaroon tayo ng isa pang malawak na assessment for 2019. Kung magiging ganito ang operation at pag-implement ng pagtulong, we really need to assess kung itutuloy pa ba natin 'yung second tranche [sa] 2019," he said.

(Everything is delayed. So we will have another thorough assessment for 2019. If the measures to help the poor would be implemented like this, we really need to assess if we will push through with the second tranche in 2019.)

Meanwhile, Senator Paolo Benigno Aquino IV repeated his call to suspend excise taxes on diesel and gasoline. 

"Honestly, nasa punto na ako na basta hanapan na lang natin ng solusyon. By December, by the end of the year, bago tumaas iyan (gas prices), kailangan hanapan ng solusyon itong presyo. Ang hirap po talaga pagdating ng Enero, sabihin mo sa tao na, 'Hirap na hirap na kayo. Pahihirapan pa namin kayo,'" Aquino said. 

(Honestly, I'm at a point where I'm like, let's just find a solution. By December, by the end of the year, before gas prices go up, we need to find a solution for the high prices. It's going to be hard by January when you have to tell people that, "You're already suffering. We'll make you suffer even more.")

"Ang nabanggit ng DOTr (Department of Transportation), 738 pa lang 'yung nakakakuha ng Pantawid Pasada Program cards out of 179,000. Ganoon kabagal 'yung pag-distribute," he added.

(The DOTr mentioned that only 738 out of 179,000 have been able to claim their Pantawid Pasada Program cards. That's how slow the distribution is.)

The Senate committee plans to conduct regular public hearings on TRAIN, and hopes to have concrete actions for stubbornly high inflation by the end of the 3rd or 4th quarter of 2018.

The Department of Finance cited a World Bank report which projected that oil prices in the global market would go down to $65 a barrel. Current prices hover around $72 per barrel.

"Economic managers did not anticipate the rise of oil this year. Parang ang hirap paniwalaan na bababa ng $65 (It seems hard to believe that prices would go down to $65)," Aquino said.

Inflation reached a fresh high of 5.7% in July, dragging the country's gross domestic product (GDP) down to 6%. – Rappler.com

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.

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