GMA jobless fund has measly P1M, dries up

As President Arroyo waxed proudly yesterday about the similarity of her supposed cash transfer program with a scheme being implemented in Brazil, where she is on an official visit, a financial assistance scheme for displaced workers in the Philppines has been put off after providing loans to 100 individuals.

The Small Business Corp. (SBC), formerly known as the Small Business Guarantee and Finance Corp. (SBGFC) and an agency under the Department of Trade and Industry (DTI), has stopped releasing financial assistance to displaced workers after using up P1 million it allocated for the program.

The SBC’s mandate was to provide financial guarantees on borrowings of small and medium businesses but last May it was shoved into providing loans to displaced workers, including laid off overseas Filipino workers (OFWs), as part of Mrs. Arroyo’s Pantawid Pamilyang Pilipino Program.

Over in Brazil, Mrs. Arroyo on Wednesday likened this country’s poverty alleviation program to Pantawid Pamilyang Pilipino Program, saying they reflect the efforts of the governments of the Philippines and Brazil “to overcome social inequality.”

Brazil’s Bolsa Família Program (BFP) provides financial assistance to indigent Brazilian families on condition that their children attend school and be vaccinated.

The program seeks to reduce poverty in the short term by direct cash transfers, while the long-term anti-poverty scheme is designed to increase human capital among the poor through conditional cash transfers.

The SBC said that additional funding that the DTI should have provided to the loan program never came.

SBC vice president Hector Olmedillo said the financial help to displaced workers was a commitment announced earlier by the DTI under the DTI-SBC Entreprenuership Loan Program for Displaced Workers launched last May, the budget for which should come from DTI and not SBC, which supposedly should be the firm that would provide the guarantees on the loans.

Olmedillo said the Department of Budget and Management (DBM) had not released the P200 million which the government had committed to fund the program.

Olmedillo said he was informed that the DBM turned down a request made by the DTI for the P200 million extra budget to fund the loan assistance program for displaced workers particularly those based in Cavite and Laguna where most of the company closures where reported early this year.

With a meager P1 million funding, Olmedillo said the SBC was only able to lend to over 100 affected workers with a maximum loanable amount of P10,000 each. The small fund had dried up and SBC was forced to halt the loan scheme.

Since SBC is a government lending institution, it would continue to focus on providing loan assistance under the SME Unified Lending Opportunities for National groth (Sulong) program, Olmedillo said.

The projection this year, he said is to release P4.5 billion worth of available funds for lending to SMEs but the number of applications remained low compared to the same period last year.

In the first semester, only P700 million worth of funds was released against total loan availments last year of P4 billion.

The decline in the number of businesses applying for loans, he said could be attributed to the current global slowdown.

Most of the defaulted accounts are in the export sector accounting for about 12 percent of the total released amount.

President Arroyo, in comparing her program with the Brazilian counterpart, said her Pantawid Pamilyang Pilipino Program provides grants to the extremely poor Filipino families for their health, nutrition and education needs, particularly children up to the age of 14.

The President first cited the BFP’s success during the state luncheon hosted in her honor by Brazilian President Luiz Inacio Lula Da Silva at the Palacio de Itamaraty, during her visit to Brasilia’s National Congress, and again when she visited the Brazilian Supreme Court.

She said President Lula’s family stipend program has resulted in a 10 percent rise in the income of Brazil’s poorest families “due in large (to) … the Bolsa Familia.”

The BFP is the centerpiece of President Luiz Inácio Lula da Silva’s social policy, and is reputed to have played a role in his victory in the 2006 national elections. –Ayen Infante, Daily Tribune