A SENIOR legislator said the effort to contain coronavirus disease 2019 (COVID-19) could be funded by a special bond issue, which he proposed to call “COVID-19 Bayanihan Recovery Bonds.”
Deputy Speaker and 1-Pacman Party-list Rep. Michael L. Romero said in a statement Friday that the bond issue could supplement internal government funds and new loans from multilateral institutions.
“I also suggest that the Department of Finance (DoF) tap the global capital markets for funds through the issuance of COVID-19 Bayanihan Recovery Bonds. Our country’s strong economic fundamentals make us creditworthy for this bold move.”
“For 2020, I believe our country needs roughly P1 trillion for COVID-19 measures (to ensure) minimal impact on the 2020 budget. This jibes with the P1.17 trillion estimates of the Finance Department,” he added.
Mr. Romero said about half of the P1 trillion could come from proceeds of Bayanihan bonds.
“Some of that P1 trillion can be funded with P500 billion in COVID-19 Bayanihan Bonds. Some could be financed with another P500 billion in multilateral loans, bilateral loans and grants, debt-for-equity swaps, capital infusion in big-ticket projects, a variety of technical grants, and supplemental financing for local government units, among others,” he said.
Mr. Romero said that about 10% of the Bayanihan bonds could be denominated in pesos to attract Filipino investors, with P25 billion can come in the form of retail bonds.
Mr. Romero also urged the Land Bank of the Philippines (LANDBANK) to waive handling fees as it distributes billions in financial aid to the poor under the Bayanihan to Heal As One Law or Republic Act 11469.
The Department of Social Welfare and Development (DSWD) has started distributing the assistance amounting to at least P100 billion this month and another P100 billion next month.
Mr. Romero said LANDBANK is handling the bulk of the P200 billion as well as the P101 billion allocated in this year’s national budget for the four million beneficiary-households of the Pantawid Pamilyang Pilipino Program or 4Ps.
He said the P162 billion DSWD budget includes P509 million in “bank service fees” that will go mostly to LANDBANK.
“Based on this amount of bank service fees, we can safely assume that the cost of downloading the P100 billion in financial assistance under the Bayanihan law for this month is in the neighborhood of P500 million,” he added.
Romero said if Land Bank could waive its service charge only for the Bayanihan cash grants, it would mean that more poor families could be given financial aid.
About 18 million low-income families are expected to receive P5,000 to P8,000 each under the Bayanihan to Heal As One Act. — Genshen L. Espedido