NextGen Day

MANILA, Philippines — The National Economic and Development Authority (NEDA) official emphasized the necessity of government subsidies in mitigating the public’s impact of rising fuel prices.

NEDA Undersecretary Rosemarie Edillion said during a Palace briefing on Tuesday that the government has earmarked PHP2.5 billion in gasoline subsidies for public utility vehicle (PUV) drivers and operators, as well as a PHP500 million subsidy for the agriculture sector, in this year’s national budget.

She stated that NEDA is asking for a PHP5 billion increase in transportation subsidies and a PHP1.1 billion increase in farm subsidies.

However, she stated that they must wait until the March 2022 fiscal report to see if tax collections will grow, which will be used to fund the higher subsidies.

“If the program generates surplus revenues, ito po ay magagamit natin sa pag-fund ng tinatawag nating mga unprogrammed ang appropriations.” As a result, ang tingin naman po natin is malamang po magkakaroon ng surplus collection, dito po natin kukuhanin [ang subsidy]. (Excess funds from the revenue program can be used to fund what are known as unprogrammed appropriations.) We believe there will be an overabundance in collections, and this is where we will acquire the money for additional subsidies),” she explained.

Edillion stated that authorities are closely monitoring recent pricing trends, noting that while fuel costs have risen in recent weeks, the rate of price increases since February has been moderate.

The inflation rate stayed at 3% in the second month of this year, unchanged from the previous month, but monetary officials, among others, forecast acceleration in the coming months as the price of oil on the international market continues to rise.

Because of the February 2022 inflation outcome, Edillion added, officials want to maintain an adequate food supply, which accounts for the highest share of the CPI basket.

Fuel items, such as liquefied petroleum gas (LPG), as well as energy and transportation, she noted, account for a significant portion of the CPI.

“Kaya dito nga po nakaabang iyong subsidiya ng gobyerno to ensure na mai-maintain natin na mababa ang presyo nitong mga ito,” she continued.

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