Aquino bares ‘investments’ for workers

PRESIDENT Aquino bared on Tuesday his administration’s “investment” in long-term measures to improve workers’ welfare in the country, including an P11.2-billion education-aid program that would benefit 1.6 million members of the Government Service Insurance System (GSIS) and the Social Security System (SSS).

In his Labor Day dialogue with various labor leaders, the President said he is not in favor of the P125 across-the-board wage increase demanded by labor groups and of House Bill 4853 on the elimination of labor sub-contracting. He said these measures have adverse effects on employment and the country’s competitiveness.

“As your President, it is my goal to ensure that progress is attained by all. It is my obligation to balance the interest of everyone…. On Labor Day, we are laying down real solutions, solutions that would strive to ensure that no one is left behind in our march toward progress and prosperity,” he added.

For him, Mr. Aquino said, looking for a solution to problems besetting the labor sector does not involve any “politicking” or “making promises that are impossible to keep.”

He added that his administration’s program for the labor sector is four-pronged–maintain the number of existing jobs, create more jobs, improve skills of workers so they can get better-paying jobs and enforce the law to protect the welfare of workers.

The President said the P125 across-the-board wage raise is clearly against the first point—maintaining the existing number of jobs in the country—as it would lead to significant job losses.

He added that such wage increase, multiplied by 40 million Filipino workers, means that businesses would have to shell out an additional P1.43 trillion a year in an economy that generates only P8 trillion.

“How will businesses recoup this? Will they also not raise the prices of their products and services, or do cost-cutting such as laying off their employees? Did anyone explain that more than 527,000 would lose their jobs in the next two years if this [wage increase] is implemented?” Mr. Aquino asked.

He said the minimum wage in the Philippines—at $9—is far higher compared to those of its competitors in the region, where countries like Cambodia have a minimum wage of $2; Vietnam, around $2.24 to $3.21; and Indonesia, $3.05 to $5.27.

“If our [minimum-wage] gap with them would become wider, who will take a chance to invest here? The growing economy that we are experiencing may be disrupted,” the President added.

Mr. Aquino said his administration has managed to rein in inflation, as shown, according to him, by stable prices of basic goods, despite rising oil prices.

“While other countries are complaining about the simultaneous increases of oil prices and basic commodities, in the Philippines, we have kept the prices of many goods stable. Those prices would increase if we compromised the stability of wages we have now. Just think, in 2011, wages increased by 5.44 percent while inflation was at 4.8 percent,” he added.

This is why, the President said, “There is a need for an exhaustive discussion and study on a wage hike, which is being coursed through the Regional Tripartite Wage and Productivity Boards.”

“I have asked them to fast-track their consultations with the unions so that they can give a new wage order at the soonest time,” he added. Mr. Aquino also expressed his objection to the proposal to end labor subcontracting called for by House Bill 4853, saying under the proposed measure, as is, would only benefit 1.8 million workers while 10.3 million others would lose their jobs.

“Is this really a solution or would this be an added burden to the problems we are bearing? What is needed here is a thorough study of the whole situation. That is why we directed the TIPC [Tripartite Industrial Peace Council] to build a consensus to widen consultations on this matter,” he said.

The President added that the government is also addressing the issue of contractualization through the implementation of Department of Labor and Employment (DOLE) Department Order 18-A, which prohibits the practice of renewing contracts every five months.

He said the government has allotted additional funds to hire more DOLE inspectors to ensure enforcement of the order, and to further train them to perform their job better.

Mr. Aquino added that a “better solution” would be to “invest” in solutions that are “realistic and lasting,” among them, the P11.2-billion Education Assistance Fund Program (EAFP), which would allow 200,000 SSS members and 1.4 million GSIS members to receive assistance for four-year degree programs and technical/vocational courses.

Budget Secretary Florencio Abad said the Department of Budget and Management will provide P5 billion—an amount certified by the Bureau of Treasury as part of the excess dividend collections remitted by government-owned or -controlled corporations (GOCCs)—while the P6.2 billion will come from the SSS and the GSIS.

The President said he has ordered the Technical Education and Skills Development Authority (Tesda) to determine the skills required by industries to help students choose courses that would give them employment right after their studies.

He added that more funds have been channeled to the employment facilitation service to expand the job-market information service, which would open the door to jobs that pay better.

The President said a total of P1.1 billion has been spent on the Training for Work Scholarship Program that is honing the skills of the youth in key industries—information technology—business-process outsourcing, construction, electronics, tourism and agriculture.

He added that state workers would receive their salary increase, through the fourth tranche of the Salary Standardization Law III a month head of schedule, or on June 1, 2012, which he said “would be just in time for the opening of classes.”

The President began his speech by addressing the concerns expressed by representatives of labor groups at the dialogue.

Among the concerns is the perception that the government has been slow in releasing funds for infrastructure, but Mr. Aquino said as of end-March, 87 percent of the P150-billion infrastructure budget for 2012 had been released.

On concerns about climate-change mitigations, the President added there are ongoing efforts to address these, including the conduct of geo-hazard mapping to pinpoint vulnerable communities, and a government program to plant 1.5 million trees to restore the country’s forest cover.

In the Senate, Minority Leader Alan Peter Cayetano called on the government and private sector also on Tuesday to push for quality jobs and decent work conditions as the Philippines faces challenges of growing number of workers in vulnerable employment, now at 15 million.

For instance, Cayetano said, Philippine exporters have been hit hard by a lingering crisis in the US and Europe while there have not been enough quality jobs being created, pushing Filipinos to be absorbed in the vulnerable employment sector.

“Vulnerable workers, as defined by the International Labor Organization [ILO] are own account workers with no stable income and social, medical and health benefits,” he added.

Cayetano said the recent ILO Labor Market Update report the Philippines’s working poor are similarly situated with those from a much poorer state Sri Lanka.

Labor Day in the country was “generally peaceful,” the Philippine National Police (PNP) said also on Tuesday, despite rallies and protests staged by members of labor groups.

“We haven’t monitored any untoward incident. The conduct of the Labor Day was peaceful,” Senior Supt. Generoso Cerbo Jr., PNP public information office chief, said.

The PNP deployed 4,000 policemen in Metro Manila in order to ensure that the rallies are peaceful. Around 700 others were to be deployed if emergency situations would arise.

Based on their monitoring, Cerbo said, similar activities in the cities of Iligan, Baguio, Butuan, Cebu, Angeles, Davao and Legazpi were also peaceful. Cerbo said they have also made preparations for today’s start of a four-day meeting of the Asian Development Bank in Pasay City. –(Butch Fernandez and Rene Acosta)