Protecting the government’s budgetary health in order to improve its pandemic response
According to Finance Secretary Carlos Dominguez III, protecting the nation’s financial health gives the administration the freedom to make choices in response to pandemic-related events.
He reminded journalists on Wednesday in a Viber message that he had made in 2020, stating that “this contagion would most likely not disappear quickly and that sometimes we may have to take a step backward after taking two forward (steps) in order to protect our gains achieved in combating the virus.”
According to him, “I think the new version has compelled us to do precisely that.”
Through subsidies, the government has taken measures to guarantee that its budgetary health does not deteriorate as a result of protecting the most vulnerable sectors from the epidemic.
Government assistance to the impacted sectors has been called into question by certain sectors, who claim that the government is not giving adequate financial assistance.
Economic managers, on the other hand, have frequently said that striking a balance between the need to give stimulus and the need to guarantee that government finances stay sustainable is critical.
The budget for pandemic-related expenditures, which is included in both the Bayanihan to Heal as One Act and the Bayanihan to Recover as One Act, is about PHP450 billion, according to the latest available figures.
As a result of the enhanced community quarantine (ECQ), approximately 80% of the population has received cash assistance between PHP5,000 and PHP8,000, which will be distributed both in 2020 and this year. These funds will also be used to fund the hiring of additional medical personnel and equipment.
Economic managers have also maintained the reopening of the economy in order to stimulate economic activity and guarantee recovery, despite the opposition of certain sectors to this policy decision.
The domestic economy fell by 9.5 percent last year as a result of the epidemic, but economic managers are optimistic that the economy will recover by 6 percent to 7 percent this year as well.
The local transmission of the Delta form, which scientists believe is more infectious than the previous versions, has prompted calls for the adoption of stronger quarantine measures by August in order to prevent future rises in local illnesses.
When asked whether returning to lockdowns will become the “new normal,” Dominguez said that he “cannot foresee the future with any degree of certainty.”
He said, “However, we can prepare ourselves for any scenario by ensuring that we have the financial resources necessary to respond properly to events.”
While the risks associated with the Delta variant are higher, Socioeconomic Planning Secretary Karl Kendrick Chua stated that the government’s response would remain focused on managing the outbreak “by ensuring a much faster vaccination rate, and limiting more stringent lockdown in local areas or sectors of highest risk, while allowing the rest of the people, especially those who have already been vaccinated, to earn a living.”
According to a Viber message to journalists, he added, “Our experience in March-April, when we were able to achieve a better balance, may serve as a model for our reaction.”
Before giving a recommendation on the kind of quarantine, he said that both the economic and health sides would need to examine the complete study first.
On being questioned about the implications for economic growth, Chua said that he would prefer to wait until the publication of second-quarter gross domestic product statistics on August 10 before reviewing the goals in light of recent events.