NEDA supports House unemployment insurance bill; says gov’t wants to cushion effects of income loss

The National Economic and Development  Authority (NEDA) has rallied behind a House bill seeking the creation of a National Unemployment Insurance Program that would provide assistance to workers during periods of unemployment, citing the need to “further improve” and “expand” the country’s current unemployment benefits. 

National Economic and Development Authority (FACEBOOK / MANILA BULLETIN)

NEDA Director Girlie Grace J. Casimiro-Igtiben expressed NEDA’s full support to House Bill No. 7028 or the proposed “Philjobs Act of 2020”, principally authored by Marikina 2nd District Rep. Stella Luz Quimbo. 

“We fully support (the) intention of the bill to institutionalize a national unemployment insurance program to better protect  the Filipino workers from the risks of income loss due to involuntary separation from work,” she told the House Committee on Labor and Employment during its  recent virtual deliberations on Quimbo’s bill.

She cited that the unemployment insurance bill is a "priority legislative agenda" in the updated Philippine Development Plan for 2017 to 2022.

“We also recognize that while the government also provides unemployment benefits through the social security system, the program may be further improved in terms of wider coverage an higher benefits for longer duration,” Igtiben said.

She laments that compared to other countries, the Philippines provides low unemployment benefits, which is 50 percent of monthly earnings for two months. 

"Other countries provide at most 80 percent of monthly earnings for 11 months, that is for Japan and 60 percent of monthly earnings for 12 months, that is for Vietnam,” the NEDA official said. 

In his sponsorship speech, Quimbo said the unemployment benefits being given by the Social Security System and the Government Service Insurance System to their members are not enough.

She noted that as  of July 8, the SSS approved P84.4 million worth of unemployment benefits to aid those affected by COVID-19. “This is only enough to cover about 7,700 minimum wage workers for two months,” she said.

The House Assistant Minority Leader said the current plight of the country’s Filipino workers should prod Congress to immediately act on her unemployment insurance measure, which seeks to protect individuals in times of job loss and provide financial and training support for job search. 

Igtiben said the NEDA asked the House panel, chaired by 1-PACMAN partylist Rep. Enrico Pineda to fully scrutinize the measure to determine the sufficiency of the proposed Endowment Fund which will fully subsidise premium contributions for workers and employers for the first year of program operations, as a form of economic stimulus; and the "financial sustainability" of HB 7028.

"To further improve the bill that is being proposed, we highly suggest the conduct of full actuarial study to ensure the sufficiency of the suggested amount for the Endowment Fund and the financial sustainability of the proposed unemployment insurance benefit,” she said. 

“Further, while the unemployment insurance aims to provide financial support to members who have been involuntarily separated from work , we recommend that in times of global crisis such as a pandemic, the program’s coverage be extended to include members who temporarily loss their income due to temporary business closure. The actual amount and duration of benefits as well as the eligibility criteria may be discussed in the implementing rules and regulations should this bill be approved.”

The Pineda panel directed its SubCommittee on Employment, chaired by Baguio lone District Rep. Mark Go to convene and conduct “further studies” on Quimbo’s bill, and consolidate it with House Bill 5701 or the proposed “Unemployment Labor Assurance Mutual (ULAM) Fund Act, filed by Manila Teachers partylist Rep. Virgilio Lacson.

HB 7028 seeks to cover all formal sector employees both from private and public sectors. The measure calls for the establishment of the Philippine Job Insurance Corporation (PhilJobs), which is tasked to administer and manage the program.