Government eyes new cash transfer program

MANILA, Philippines - The government is eyeing another cash transfer program, this time to protect the poor from an impending fuel price hike as a result of a plan to increase oil excise taxes.

“We are currently developing a targeted subsidy plan, similar to that of Indonesia, where the most vulnerable... will be protected in a manner like that of the 4Ps or Pantawid Pamilyang Pilipino,” Finance Secretary Carlos Dominguez said in a statement yesterday.

The plan, currently being drafted by Malacañang, will involve protecting the bottom 50 percent of Filipino households from a rise in oil prices, larger than the current 40 percent included in the conditional cash transfer (CCT) program.

This means the coverage will also be bigger than the 4.4 million households selected under the National Household Targeting System of the CCT program.

To finance this, estimated revenues of P159 billion from higher oil excise taxes included on a comprehensive tax reform package “will be redirected,” Dominguez said.

Sought for details, Finance spokesperson Paola Alvarez said the measure would be proposed separately from the tax reform package eyed to be submitted to Congress this month.

“The guidelines on how to determine (the coverage) will be in coordination with NEDA and the DSWD, subject to the proposed amendments by legislators,” Alvarez said in a text message.

The Department of Social Welfare and Development (DSWD) spearheads the CCT program, which gives out a maximum of P1,200 a month to a family of four, provided pregnant mothers are attended to and children go to school 80 percent of the time.

It was not clear how much will be provided and how many families will be covered under the plan. The CCT program alone will cost the government P54.9 billion next year, budget data showed.

But in Indonesia, the government carried out a large-scale cash transfer program in 2005 and 2008 that targeted 19 million households which received $11 a month as subsidy when the oil-exporting country increased fuel prices. But these were non-conditional allocations and were given for a limited period.