MANILA – Households dependent on wage earners have been wobbling from the swift rise in the prices of basic goods and services since May, the Trade Union Congress of the Philippines (TUCP) said Sunday.
“Families of workers receiving fixed wages are suffering the most from the sudden jump in the cost of rice and other food commodities,” said TUCP president and former Sen. Ernesto Herrera in a news release.
“The reason for this is simple. Workers spend up to three-fourths of their wages on food — and food prices tend to increase at a faster rate than non-food products,” said Herrera, former chairman of the Senate committee on labor, employment and human resources development.
Food prices have gone up since May, partly on account of the potential impact of El Niño on farm output, and partly due to profiteering by rotten traders, according to Herrera, also one-time chairman of the Senate committee on economic affairs.
Last week, the Bangko Sentral ng Pilipinas (BSP) bumped up its inflation rate forecast to 4.4 percent for this year, and 3.7 percent for 2015. The previous estimate was 4.3 percent this year, and 3.4 percent for 2015.
The inflation rate refers to the pace of increase in the general price level of goods and services in an economy over a period of time.
A negative effect of higher inflation rate on the economy is the rapid erosion of the real value of wages, which means workers are able to buy fewer goods and services, Herrera said.
Malacañang last week assured consumers that the P2-per-kilo increase in rice prices “is only temporary.”
The Palace said it expects rice prices to go down once fresh harvests come in by October.
Amid the surge in consumer prices, Herrera urged both the House of Representatives and the Senate to give the highest priority to the passage of new legislation that would help ease the troubles of wage earners.
“One option is to substantially lessen the income tax burden on workers. Right now, up to 32 percent of salaries are withheld as taxes,” he pointed out.
“Another option of course is to raise wages,” he said, adding that no less than the Constitution mandates a “living wage” for labor.
No to LRT/MRT rate hikes
Meanwhile, Herrera urged Malacañang to abandon plans to increase by an average of P5 the basic fare for a typical trip at the Light Rail Transit Lines 1 and 2, and the Metro Rail Transit Line 3.
“The administration should forget about raising fares and slashing by P2.4 billion the annual subsidy to Metro Manila’s three elevated trains. This will only aggravate the plight of employees who use the trains to go to work every day,” he said.
The Land Transportation Franchising and Regulatory Board has already granted the tariff increase sought by public utility jeepney operators, raising the basic fare to P8.50 from P8. –InterAksyon.com
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