A newspaper media person asked the insights of Laban Konsyumer Inc. regarding the consistent increases in fuel prices. The specific question was: What can the government do to protect consumers from rising prices of goods?
Our comment: The persistently high fuel prices can drive inflation higher from the January inflation of 3 percent and higher prices of basic goods impact badly on consumers especially those who belong to the vulnerable sectors like the daily wage earners, the public transport drivers and riders, the elderly, persons with disability, ethnic minority and the food poor.
In 2021, year-to-date increases for gasoline was 17.65 pesos a liter, diesel was 14.30 a liter and kerosene was 11.45 pesos a liter. For the current year, the increases are 5.70, 7.95 and 7.20 per liter, respectively. Diesel and kerosene are socially sensitive products and naturally hurts the pocket of the poor consumers.
Fuel prices continue to climb. Dubai prices are forecast to increase by 6.5 percent in 2022 vs. 2021. Dubai crude is the benchmark for fuel prices in Asia and from which the Malampaya gas price is indexed.
I asked a cross section of consumers who are doctors, economists, engineers, media persons, government officials and other professionals on what government can do to protect and help consumers amidst the continuing rise in oil prices. These were the answers I received from them. I retained the original statement sent by these consumers to me.
- Get back the oil stabilization fund and regulate the oil industry.
- Shift to electric vehicle.
- No politics that serve the interest of the oligarchs.
- Freeze or suspend Value Added Tax and excise taxes on fuel products.
- Price control under pandemic landscape. Not an ideal choice but necessary.
- Lower taxes are another option.
- Government should institute measure to closely monitor amd ensure stable prices of basic necessities.
- Lift the increases in the SRP of basic goods.
- The country should initiate measure to manage the volatility amidst the rising world oil prices .
- The government should not let its guard down.
- Power generation costs are set to increase as we approach summer. This is not only due to higher fuel costs, but also due to the precarious supply situation. The regulators have issued warnings of red and yellow alerts and when these alerts occur, it will trigger higher spot market prices and higher generation costs from Distribution utilities and electric cooperatives.
- Fuel and power costs indirectly affect the cost of transportation and production of basic goods and services. Thus, when fuels and power prices go up, prices of food and other commodities also tend to go up. So far power rates had gone down by twenty centavos per kwh .
- We call on the government to remain vigilant despite the lower inflation in January and implement measures such as temporary reduction of taxes on fuel products and approve contracts to mitigate the impact of consumer prices of higher fuel and power prices in the coming months.
- Suspend the excise tax on fuel products.
- Impose temporary price freeze on basic commodities.
- Suspend application of fare hikes but government should give out fuel discounts coupons for driver and operators consuming 50 liters week.
- Buy back Petron.
- Moratorium on imposition of excise taxes on fuel products.
- Buy back majority shares of Malampaya to make way for cheaper electricity.
- Rationalize PUV deployment.
- Repeal the rice tariffication law.
- Repeal EO on meat importation.
- Review EPIRA law.
- Let government build own energy and power projects.
- Subsidize prices for specific class of consumers.
- Conduct special tax audit of oil companies, traders and importer of fuel products to determine that correct amount of taxes is paid amidst the 2021 high fuel prices increases.
- Repeal the Oil Deregulation Law.
- Repeal the excise taxes on socially sensitive fuel products like kerosene, household LPG and diesel.
- Add diesel and gasoline in the list of basic necessities which are subject to price freeze or price control in times of calamity and disaster.
- Repeal the present weekly oil pricing formula that entails identical amount of price adjustments among the oil companies and traders.
I received concrete and reasonable proposals from these consumers on what the government can do to protect the consumers amidst the unabated oil price hikes. Some are doable and can be done now when the regulators feels like they have the political will to help the consumers. The assistance should be more than a 5 thousand pesos jeepney driver kitty, if at all given. What can we offer and provide the food poor consumers?
As one news person quoting me stated : “the quality and the quantity of the food of the poor is becoming poorer and faster “.
Atty. Vic Dimagiba
President, Laban Konsyumer Inc.
Email at [email protected]