Drilon: P10-billion aid to pandemic-hit companies a joke
Senate Minority Leader Franklin Drilon on Wednesday, March 17 stressed the need to increase the amount of money the government intends to release to help strategically important companies (SICs) that have been badly hit by the COVID-19 pandemic.
Drilon made the call as he described the P10-billion equity infusion under Senate Bill No. 1646 or the proposed Government Financial Institutions Unified Initiatives to Distressed Enterprises for Economic Recovery (GUIDE) Act as a mere “drop in the bucket”.
The Senate subcommittee on Banks, Financial Institutions and Currencies tackled the GUIDE bill that primarily seeks to expand credit programs to assist micro, small and medium enterprises (MSMEs) that were heavily impacted by the pandemic.
It seeks to infuse P7.5-billion into the Land Bank of the Philippines (Land Bank) and P2.5-billion into the Development Bank of the Philippines so they can establish a firm that would assist in rehabilitating SICs suffering from bankruptcy amid the global health crisis.
However, Drilon noted the P10-billion rescue package “is a joke” compared to the P19-billion budget the government infused to the
National Task Force to End Local Communist Armed Conflict (NTF-ELCAC)
for 2021 which is run by politicians.
“Given the size of the contraction of our economy, among the worst in
the world. Nine point five (9.5) percent of gross domestic product
(GDP), which is about P1.5-trillion, P10-billion as a rescue package
is a joke,” Drilon said.
“I raise the issue of priorities. We have 19.5-billion in
anti-insurgency fund, we have P10-billion to assist SICs…Where are our
priorities?” he said.
Under the GUIDE bill, 15 SICs suffering from solvency problems are
being eyed for equity infusion.
Guian Angelo Dumalagan, Land Bank’s assistant vice president and chief
market economist, defended the government’s position saying the
country can only afford to allocate P10-billion under the GUIDE bill.
She said that even if the amount to be provided for these SICs are
small, “the results are big if we will not also assist these
companies.”
Drilon agreed that these pandemic-hit SICs need funding assistance,
but a P10-billion funding is small.
“If we are going to assist, we should provide more assistance provided
there are safeguards. But not just at P10-billion,” the senatorappealed.