THE Department of Health (DoH) on Sunday urged the public to report unlicensed clinics that treat foreigners infected with the novel coronavirus.
In a statement, the agency said treatment should only be sought from licensed health facilities and physicians who give medicines approved by the Food and Drug Administration.
“Doing otherwise might result in harm,” DoH said. “While we have not received any reports about clandestine hospitals for Filipino patients, we encourage everyone to report these unlicensed facilities because they endanger our health,” it added.
The Health department said it was coordinating with the authorities about the clandestine facilities, while contact tracing continues.
Police raided an underground medical facility in Pampanga and Makati last month catering mostly to Chinese nationals.
The Bureau of Immigration placed two Chinese nationals on the alert list for operating the underground hospital at the villa in Fontana Leisure Park in Clark Freeport.
They will not be allowed to leave and will be referred to the bureau’s intelligence and legal divisions if encountered in the airport. They were arrested in the raid but were released without being charged.
Justice Secretary Menardo I. Guevarra has said he would order the National Bureau of Investigation and Immigration bureau to find illegal clinics in the country. — Vann Marlo M. Villegas
Samal resort owners seek local gov’t help for furloughed workers, long-term alternative livelihood
SAMAL, accessible by boat from Davao City, is a popular beach destination for day-trippers, weekend tourists, and long-term guests. While Samal can resume tourism activities under its quarantine classification, Davao City will remain under the stricter category at least until June 15. — BW FILEPHOTO
THE summer months of April and May are typically the busiest for Samal Island, the top beach destination in Davao Region given its proximity to the Davao airport. But this year, with the coronavirus disease 2019 (COVID-19) pandemic, the more than 100 resorts on the island have been forced to close. And resort owners are seeking help from the local government, primarily for workers who have been furloughed due to the halt in tourism activities. Pastor M. Lozada, Jr., president of the Samal Resort Owners Association, said while some of their members have been able to keep paying their employees, they are also spending to maintain facilities despite zero income since mid-March when the lockdowns started. “All resort owners do not have income, but we need to maintain our facilities and to sustain this, we need to produce cash, but we are running out of cash,” said Mr. Lozada, speaking in mixed English and Filipino, in a phone interview. He said very few of the affected workers were included in the list of beneficiaries for the cash aid from the national government under the social amelioration program (SAP). He added that this is merely a short-term subsidy, along with the relief packages distributed by the local government, which do not address the anticipated long-term impact of COVID-19 on the tourism industry. “Very few of them received the SAP. And even if they were given rice and sardines, that is not the solution. What is needed is they be given work,” Mr. Lozada said.
NOT SOON
Resort owners on the island, officially named Island Garden City of Samal, do not expect tourists to start coming soon even when travel restrictions are eased and airports are reopened. “Tourism is really dead here in Samal. And we are expecting that most of the people who will be going to the resorts, when everyone is allowed to go out, mostly will be locals,” he said. But, he added, neither are they betting big on local visitors because “they are (also) mostly with no jobs.” Latest local government data show the island received an average half a million day-trip tourists annually and over 250,000 who stay a night or more. Samal Mayor Al David Uy, in an interview over Davao City Disaster Radio last May 15, said they are already planning tax discounts for resort owners, which will be applied during the business permit renewal next year. “We will give discounts to resort owners next year. If we look at Samal tourism at this point, it is zero,” Mr. Uy said. Mr. Lozada, however, said a tax discount is “immaterial” and that the more pressing problem that needs to be addressed is unemployment. Samal, established as a city in 1998, remains agriculture-based with coconut and copra production as top sector. — Maya M. Padillo
Business groups denounce impunity of officials violating quarantine protocols
BUSINESS groups denounced the prevailing culture of impunity with reports of public officials violating quarantine protocols but not immediately held liable by law enforcers.
In a statement on Sunday, different private sector organizations said they have been supporting the “whole-of-government, whole-of-society” response against the coronavirus pandemic, noting that its members as well as their employees and officers were compliant with measures to contain the spread of the disease.
“We are therefore greatly disappointed — even appalled and dismayed — about news reports of public officials violating with impunity the IATF (Inter-Agency Task Force) and DoH (Department of Health) protocols intended to protect public health,” they said in a joint statement, without naming any official.
They noted that from March 17, the start of the strict lockdown, until April 17, almost 30,000 civilians had been arrested — with 6,616 undergoing inquest while 23,016 cases were for filing.
The total increased to nearly 41,00 by May 1.
Financial necessity and unfamiliarity with the new rules led to detention of people for days, which increased their risk of exposure to the virus in overcrowded facilities, they said.
They cited the rule of the Supreme Court reducing bail and allowing recognizance for the release of the accused.
The signatories are the American Chamber of Commerce of the Philippines, Canadian Chamber of Commerce of the Philippines, Financial Executives Institute of the Philippines, Institute for Solidarity in Asia, Inc., Institute of Corporate Directors, Judicial Reform Initiative, Makati Business Club, and Management Association of the Philippines.
They added that those arrested “suffered detention, costs, humiliation, and inconveniences, and some endured unwarranted jail time when unopened courts or government offices, or even limited bank branches, could not process their bail in a timely manner.”
The groups said they trust that the government will strictly observe and enforce the rule of law “and serve as role models in discipline and moral ascendancy.”
“Upholding the law and ensuring faith in our justice system stand as the bedrock of our democracy, and will enable the economy to survive and recover from these most trying times. The sacrifice of our people deserves nothing less,” they said.
Major General Debold M. Sinas, head of the National Capital Region police, celebrated his birthday with a party early this month despite protocols prohibiting mass gatherings.
He has been charged for violating quarantine protocols, along with 18 other policemen, but has not been ordered to step down from his post.
Senator Aquilino L. Pimentel is also facing charges for breaching quarantine protocols when he accompanied his wife who was due to deliver their child at the Makati Medical Center last March.
Mr. Pimentel tested positive for coronavirus.
According to the World Justice Project 2020, the Philippines has one of the weakest rule of law in the East Asia and the Pacific region, ranking 91st out of 128 countries in the Rule of Law index, same as last year.
The country rose in the ease of doing business ranking at 95 from 124 last year, according to the World Bank Doing Business 2020 report, citing the abolishment of the minimum capital requirement for domestic companies and by easing construction permit processing and streamlining process to secure occupancy certificates. — Vann Marlo M. Villegas
Senator wants probe on OWWA assistance to returning overseas workers
PHILSTAR
A RESOLUTION seeking to look into the operations of the Overseas Workers Welfare Administration (OWWA) in assisting returning overseas workers has been filed in the Senate.
Minority Leader Franklin M. Drilon filed Senate Resolution No. 417 after finding OWWA’s assistance to workers displaced by the coronavirus disease 2019 (COVID-19) as “insufficient and dismal.”
Mr. Drilon said the agency has yet to tap its P20-billion OWWA Fund, sourced from overseas Filipino workers (OFWs) and has so far only facilitated the provision of food packages, transportation and accommodation of workers.
The Fund “could be and should be utilized to help OFWs affected by the COVID-19 pandemic by providing them adequate financial, livelihood and other assistance,” the resolution read in part.
It may be used to benefit returning workers through insurance coverage, legal assistance, placement assistance, remittance services, skills and career development, among others.
On top of this, OWWA has a P1.58 billion allocation under the 2020 national budget, Mr. Drilon noted.
President Rodrigo R. Duterte on May 26 ordered the agency, along with the labor and health departments, to immediately send home 24,000 repatriated workers who have been stuck in quarantine facilities in Metro Manila for over two months.
Labor Secretary Silvestre H. Bello said on Friday some 19,000 workers have already been transported to their hometowns.
Meanwhile, the Department of Foreign Affairs continues to repatriate Filipinos affected by the pandemic that has infected 6.1 million and killed more than 370,000 people worldwide.
Some 150 overseas Filipinos from Malaysia and India arrived on Saturday, bringing the number of repatriates to more than 31,000 since February.
In its May 30 report, the Department said there are 2,869 confirmed cases involving Filipinos abroad, including 1,554 active cases. The remaining 975 have recovered, while 340 have died.
In another development, the Philippine Overseas Employment Administration (POEA) warned the public against schemes online promising employment after the ongoing country-wide quarantine.
“The public is warned of promises of online scammers for job interview and deployment after the ‘lockdown’ or after ‘lifting of the quarantine,’” reads POEA Advisory No. 62 dated May 22.
These online advertisements usually ask for reservation fees and/or personal information.
POEA said legitimate online employment advertisements must state the following, but not limited to: Name of the licensed recruitment agency, the agency’s registration number, job positions, qualifications, and salaries.
Payments must be made to the recruitment agencies.
“Absent these information, the POEA urges the public to ignore the advertisements,” it said.
POEA’s Website has a verification system for licensed recruitment agencies and available jobs. — Charmaine A. TadalanandGillian M. Cortez
Senate panel finalizes Bayanihan law extension, stimulus package
THE measures extending President Rodrigo R. Duterte’s special powers until September and the proposed economic stimulus package are being finalized, the Senate committee on finance said on Sunday.
Senator Juan Edgardo M. Angara, who chairs the panel, said they are planning to endorse the extension of the Bayanihan to Heal as One Act and the economic stimulus during Monday’s session.
“Trying for tomorrow,” Mr. Angara said in a phone message, “Just awaiting comments from senators and agencies before finalizing committee report.”
The panel, joint with the committee on economic affairs, last week tackled the Bayanihan law, which granted Mr. Duterte the authority until June to realign the budget to fund measures in response to the coronavirus disease 2019.
Congress will adjourn on June 3 and is set to open the second regular session on July 27. At least four economic stimulus bills have been filed, with proposals ranging from P108 billion to P600 billion.
Mr. Angara said the panel has yet to agree on the amount.
The House of Representatives has approved on second reading the proposed Philippine Economic Stimulus Act, which will inject P1.3 trillion between 2020-2023 to aid workers and businesses. — Charmaine A. Tadalan
Party-list rep files bill for mandatory registration of stranded, abandoned workers
CONSTRUCTION Workers Solidarity Party-List Rep. Romeo S. Momo has filed a bill mandating the registration of all stranded and displaced workers to expedite government aid in times of crisis such as the ongoing coronavirus outbreak.
Under House Bill 6813, employers will be required submit a list of all affected workers within five days from the declaration of a lockdown to the barangay or local government as well as to the field office of the Department of Labor and Employment.
Mr. Momo said while stranded workers are supposedly covered by the Social Amelioration Program of the government, “some still fall through the cracks and remain unassisted and because of the direness of the situation, many of the stranded workers, majority of which are construction workers, were forced to beg or use social media to call for donations and relief goods.”
If passed into law, employers face fines or imprisonment for non-compliance.
The bill is currently pending at the committee level in the House of Representatives. — Genshen L. Espedido
Poe appeals for faster cell site rollout for digital learning
THE Senate committee on public services appealed to President Rodrigo R. Duterte to order a faster rollout of cell sites across the country for improved connectivity as the education sector is expected to tap more digital learning options amid the coronavirus threat.
“We appeal to the President to put to task all sources or causes of delay in the construction of the necessary infrastructure to enable us to connect effectively with our students who are aspiring for better lives,” Senator Grace S. Poe-Llamanzares, committee chair, said in a statement on Sunday.
The Department of Information and Communications Technology had said there are currently only 20,000 towers in the country and 50,000 cell sites are pending installation.
The Department of Education has set the reopening of classes on August 24, with minimal face-to-face interactions through alternative learning platforms. — Charmaine A. Tadalan
Courts in GCQ areas to continue virtual hearings
THE Supreme Court will allow trial courts in areas under the general community quarantine (GCQ) category to continue conducting hearings through videoconferencing.
In a statement Sunday, Court Administrator Jose Midas P. Marquez said this was approved by Chief Justice Diosdado M. Peralta in a circular, following the physical closure of courts due to the strict lockdown as part of mitigation measures to stop the coronavirus spread.
“Hence, for example, if a party wishes his/her case to be heard via videoconferencing, the proper motion just needs to be filed, and the court, using its sound discretion, can either grant or deny the motion,” Mr. Marquez said, adding that it applies to both civil and criminal cases.
Courts in areas that were first placed under eased lockdown were allowed to open with skeleton staff starting May 18. — Vann Marlo M. Villegas
Current economic policy is focused on fighting the pandemic. The Central Bank has loosened monetary policy, and the national government has hiked its expenditures by allowing a higher deficit.
The steep rise in government expenditures is meant to expand and strengthen the health care system and provide social amelioration. Money is flowing to procure medicines, testing kits, and other medical supplies and equipment; augment the healthcare workforce; transfer cash and in-kind assistance to the poor; provide wage subsidies; and lend assistance to micro, small and medium entrepreneurs.
But the immediate objective of loose monetary and fiscal policies is not to pursue economic growth but to protect health and save lives. The massive spending for health and social amelioration goes hand in hand with a deliberate policy of having a community quarantine to slow down the spread of COVID-19. This essentially locks down the economy.
Although the focus is on saving lives, even if it means trading off economic activity temporarily, the government has set in motion the actions and the reforms that have to be undertaken for the economic recovery.
We do not know exactly when the recovery will happen and how quick it will be. We still do not know much about COVID-19. We do not know when the vaccine will be introduced. Fear of getting infected by a highly contagious disease cannot be fully vanquished when our information about the virus is limited and our weaponry to quell it is incomplete. The title of the book authored by British economists John Kay and Mervyn King, says it all: we face “radical uncertainty.”
Despite this radical uncertainty, policy-makers have a grasp of the required critical reforms for economic recovery. Tax reforms are absolutely necessary in light of a deficit that is running now at 8% of Gross Domestic Product (GDP). Such a level of deficit spending has to unwind once the crisis created by the pandemic subsides. On the other hand, the new normal will require a sustained higher level of spending for health and human development, science and technology, and new types of infrastructure.
It is thus providential, in a manner of speaking, that tax reforms, embodied in TRAIN (or Tax Reform for Acceleration and Inclusion) law, were enacted before the outbreak of the pandemic. The tax reforms have given the country much wider fiscal space to spend in the time of crisis or emergency. It has made the country creditworthy as indicated by the investment grade that credit-rating agencies have given to the Philippines. Thanks to the tax reforms, The Economist has ranked the country sixth among emerging economies in terms of financial strength.
Nonetheless, the comprehensive tax reform program remains incomplete. One critical package that should have been passed much earlier is now being deliberated. This is about the rationalization and restructuring of fiscal incentives together with the reduction of corporate income tax. Formerly called CITIRA (Corporate Income Tax and Incentives Reform Act), it is now dubbed CREATE (Corporate Recovery and Tax Incentives for Enterprises Act).
This reform has long been overdue, but it has gained traction recently. Ideally, Congress should have passed it on the heels of TRAIN. But the intransigence of the Philippine Economic Zone Authority (PEZA) and the hazards of compromise obstructed the bill’s early passage.
Because of the economic crisis brought about by the pandemic, the reform on corporate income tax and fiscal incentives has to adapt to the new complexity. It has to respond to both the short term, which is about the stimulus, and the long term, which is about tax and economic restructuring.
In this context, CREATE differs from CITIRA. The main change is in terms of the speed of reducing corporate income tax. CITIRA was prudent by allowing a gradual decrease in the income tax. Concretely, CITIRA would have allowed a drop of one percentage point of the tax rate every year, currently at 30%, till it reached 25%. Thereafter, further tax decreases to settle at the rate of 20%t would be made contingent on the desired sustainable level of government deficit. This was the design and the approach to avoid huge revenue losses and make the reform revenue neutral.
But the pandemic has changed the calculus. Fiscal stimulus has become urgent. Hence the bill has been redesigned as CREATE, which will immediately and in one single stroke reduce the corporate tax from 30% to 25%t. On top of this, the proposal is to extend the application of net operating loss carryover (NOLCO) for business losses in 2020 from the current three years to five years.
In sum, the original intent of revenue neutrality has to give way to the expediency of the stimulus, resulting in a net revenue loss.
The essential features found in CITIRA are retained in CREATE. Specifically, the reform makes the incentives transparent, time-bound and performance based. The reform also introduces a governance and review board to ensure that applications for incentives meet the rigorous economic criteria.
Moreover, CREATE will move away from the “one-size-fits-all” regime that relies heavily on tax incentives towards a wider and more balanced menu of tax and non-tax incentives. This menu brings innovativeness, adaptability and sophistication that all the more requires having competent governance, which is organizationally expressed in the Fiscal Incentives Review Board.
As noted earlier, CREATE is responsive to the immediate challenges brought about by the pandemic. CREATE is both a stabilization mechanism and a longer-term reform for investment promotion and tax efficiency and equity. The short term and the long term may be independent of each other, but they are not contradictory,
The immediate and sharp reduction of corporate income tax from 30% to 25% exemplifies the short-term goal of a stimulus. But we make an important caveat on the tax cut. The lessons of previous economic recessions, as well as what the literature tells us, show that the effectiveness of a tax cut as a fiscal stimulus is limited. This is because gains from the tax cut (the beneficiaries are mainly the upper classes and corporations) are not necessarily used for consumption that increases aggregate demand. Corporations, for example, might just save the windfall as a strategy to ride out the pandemic, or for those remaining profitable, they might use the gains derived from the tax cut to reacquire stocks or give dividends to the wealthy shareholders.
On the other hand, corporate tax reduction for firms with high labor intensity can have higher social benefits.
Thus, there is room to improve the design of the tax cut to make it truly responsive to a stimulus that will ultimately benefit workers and their households. The tax cut must find a way to be translated into wages that will boost aggregate demand.
Hence, our proposal is to make the immediate corporate tax reduction from 30% to 25% contingent on job preservation or job creation. This is a social bargain. The firms will be entitled to the swift income tax reduction only if they would retain their workforce or, better, increase employment. The heart of the stimulus is found in the bill’s title: CREATE. Tying the corporate tax reduction to creating jobs is thus essential.
Filomeno S. Sta. Ana III coordinates the Action for Economic Reforms.
Thirty one leading business groups including the prestigious Financial Executives Institute of the Philippines (FINEX), the Management Association of the Philippines (MAP), the Philippine Chamber of Commerce and Industry (PCCI), GoNegosyo, and the Chambers of Commerce from the Americas and Europe recently signed a manifesto expressing their support for the passage of the Corporate Recovery and Tax Incentives for Enterprises Act or the CREATE Law.
CREATE replaces CITIRA (Corporate Income Tax and Incentives Reform Act), the second tranche of tax reforms that has been stalled in the Senate for more than six months. It is vital that CREATE passes both Congress and the Senate before they go on recess on the sixth of June. The country’s economic future depends on it.
CREATE was crafted to save businesses in distress, stimulate the economy, and restore growth following the onslaught of the Wuhan virus. It is also designed to make the country more competitive in attracting the foreign direct investment (FDIs) we badly need.
As Finance Secretary Sonny Dominguez puts it, CREATE is the first ever revenue-eroding tax reform package proposed by the Department of Finance. In other words, instead of proposing more taxes and/or higher tax rates, CREATE aims to reduce it. With its passage, the government will forgo P625 billion in annual revenues and instead put these funds in the hands of the private sector. It is an expression of trust on the government’s part towards the private sector as it relies on the latter to use the tax savings to expand and create jobs.
CREATE is composed of four components.
The first is the immediate cut of corporate income tax from 30% to 25% starting July. The one-time 5% cut will be followed by an annual cut of one percent from 2023 to 2027. Not only will this relieve Filipino corporations of its heavy tax burden, it will also put the Philippines in step with the corporate income tax rates of our regional neighbors.
The standard corporate income tax rate in Singapore is 17%, it is 20% in Vietnam and Thailand, and 24% in Indonesia. One can understand why foreign investors shy away from the Philippines with our 30% tax rate. CREATE will even the playing field and make us more competitive.
The second component is to maintain, for a period of nine years, the tax rate of 5%-of-gross-income for companies already operating in the Philippines. This is meant to dissuade investors from leaving our shores whilst other incentives are rationalized.
The third component is to extend the applicable years to carryover net operating loss, from three to five years.
Small businesses are among the most severely hit by this pandemic and will surely book massive losses this year. This provision allows them to carry over the losses, thus lowering their tax obligations for the next five years. Small businesses can use their tax savings for re-investment.
The fourth component is to make our tax system more flexible by allowing the Fiscal Incentives Review Board (FIRB) to recommend to the President the grant of longer incentives and additional non-fiscal incentives for desirable foreign investors.
Secretary Dominguez made a very good point. He asserts that the Philippines has offered generous tax incentives to potential investors for 40 years, yet, has always had the least share of FDI among ASEAN-6. It is about time we accept that this one-size-fits-all approach does not work.
What the good secretary proposes is a one-on-one approach whereby our Investment Promotions Agencies speak to particular companies who are strategic to us. With flexibility in fiscal and non-fiscal incentives, we can tailor-fit the package of incentives to one that is most meaningful to them. We will have a higher probability of bagging investors this way.
What constitutes a strategic investor? It is one that offers pioneering technology, one that promises recurring and substantial export earnings, one that offers massive employment opportunities.
This law is critical especially since we have stiff competition to attract manufacturing companies leaving China. At least 2,000 companies from America, Japan, Korea, and the European Union are leaving China mainly for three reasons: 1.) To release their supply chains from dependence on the communist republic; 2.) Because of rising costs (labor and rent) and stricter environmental laws; and, 3.) As retaliation for not being forthright and withholding information on the lethality of the Wuhan virus during the first months of the outbreak.
I cannot overstate the urgency of implementing this tailor-fit approach to attract FDIs. Last week, Japanese Chamber of Commerce, Inc. estimated there could be at least 300 Japanese companies leaving China and the first choice of country to relocate to is Thailand at 28%, then Vietnam at 22%, then some to either Malaysia and Indonesia. No company said they would relocate to the Philippines. Instead, some of the 300 Japanese companies who have manufacturing bases in the Philippines may leave to consolidate their manufacturing in their new sites. This is aside from the US companies who have already left China but did not relocate to their oldest friend in Asia but instead went mostly to Vietnam.
Attracting FDIs is a high priority since we must generate jobs for nearly 3 million displaced Filipinos (possibly 6 million by July) and half a million returning OFWs. We need FDIs to hasten our transition from being a consumer-driven economy, which will only take us so far, to one that is led by production.
CREATE is a law that is long overdue. We could not enact it before because the government’s revenue collection ratio (vs. GDP) was low and to reduce tax rates would further starve the government of funds. But thanks to the TRAIN law, the revenues to GDP ratio has improved to an all time high of 16.1% (as of end 2019). We can now afford to enact this long-overdue tax reform.
I applaud the Department of Finance for coming-up with CREATE. It is a bold law that will forever change the business landscape of the country. It will have a profound effect on our economic future as we move forward.
I urge Congress and the Senate to please pass the CREATE bill before you go on break. We need this bill to help Filipino companies survive, revive the economy, and attract our fair share of FDIs. I, along with 31 business groups make this urgent appeal.
I am pleased to share with readers excerpts from a recent report and Zoom forum appearance connected with, what else, coping with COVID-19.
Following is the executive Summary of the May 26 quarterly outlook report that Christine Tang and I wrote for subscribers of GlobalSource Partners (globalsourcepartners.com) called “Is it the end of the world as we know it?”
Only a handful of countries can claim to have been prepared for the COVID-19 pandemic. The Philippines is not one of them. When local transmission began, the government resorted to the only tool it had to contain the outbreak: the lockdown hammer. It used this to close government and business, offices and schools, and even public transport. The economic cost was enormous, at P1.1 trillion, or 5.6% of GDP, for the 45-day lockdown.
In this time of extreme uncertainty, when past data offer little guidance for the future, and policy responses are evolving quickly, forecasting becomes even more of an art than science. For this forecast exercise, we started with the Q2 lockdown, then visualized the economy under a “new normal,” and likely outcomes from government efforts to avoid a second wave of infections on one hand, and to revive the economy on the other.
The outlook is quite grim: a sharp contraction of 7% this year, with GDP not expected to rebound before 2022. Indeed, with masking directives, distancing protocols, borders closed, and police checkpoints everywhere, the hit R.E.M. song from the 1980s (“It’s the End of the World as We Know It”) continually replays in our heads.
We have been seeing a lot of a chart from the Economist, showing the Philippines ranking 6th among 66 emerging market economies in terms of public debt, foreign debt, cost of borrowing, and reserve cover. The assumption has been that the government has the fiscal space to do whatever it takes to counteract a recession. Yet fiscal authorities have been quite restrained on the subject of fiscal stimulus. Indeed, fiscal authorities have a tough balancing act ahead. What they choose to do — and we think they have room to maneuver — will matter greatly for how well the economy will emerge from this crisis.
It appears that even President Rodrigo Duterte is suffering from lockdown fatigue. As soon as the ECQ in Metro Manila was “modified” to let some businesses partly reopen, he invoked presidential exemption and flew home to Davao. Indeed, nobody expected the ECQ to last this long, nor how slow the government would be to ramp up infection testing. We have had no word on how the pandemic may have affected Duterte’s approval ratings, but we may expect them to follow economic and social indicators. The deeper and longer the economic downturn, the greater the risk of more populist measures, and fear of a lame-duck presidency. Indeed, political analysts say the constant presence of Senator Christopher Go at the president’s side during his regular COVID-19 press briefings is a sign that succession planning is ever on the president’s mind.
Following are my remarks as a reactor in a Stratbase Zoom roundtable on PPP post COVID-19, held on May 29.
In a book titled Momentum that Toti Chikiamco and I co-wrote with three others friends last year — Dondon Paderanga, Raul Fabella and Noel de Dios — a number of our old columns talked about PPP (public-private partnership) and the circumstances under which it is the ideal mode for project development and implementation. I was delighted to see that one of my columns there was posted by former PPP Center chief Phil (Pecson) or perhaps earlier by predecessor Cosette (Canilao) in the PPP Center site. The title of the column is “The Great Infrastructure Debate.” (You can read it at https://ppp.gov.ph/in_the_news/the-great-infrastructure-debate/ or you can get a copy of our book published by FEF.)
It talks about the pros and cons of PPP vs using the GAA and concludes that “given the huge infrastructure requirements of the Philippines it should not be PPP versus ODA but rather PPP AND ODA”
I further noted that “the lively debate may have been driven by the sudden change in public policy, yanking without compelling reasons several projects at advanced stages of preparation to an ODA or tax funded mode after these have been prepared for a PPP bid over many years. This has raised concerns over the consistency and stability of government policies from many capable local and global players who have invested substantial resources to bid for these. Included in these are five regional airports and Kaliwa Dam.”
Had the administration pursued these projects, these would likely have already been completed and serving the public. Especially the much-delayed bulk water project.
But that is water under the bridge, pardon the pun, and we need to move on. And as a policy advocate, like Stratbase guys, I believe that we should “never let a good crisis go to waste.” What is possible to do in the remaining time?
This is what I wrote in a column last week as one among key reforms that can be done for the third phase of PROGRESO, the recovery “bounce back” phase.
“More reliance on PPP, including bringing to the finish line projects that have been under protracted negotiations. This can help rebuild damaged investor confidence. It will also help conserve now stretched fiscal resources. Government also needs to assure stability in regulation for existing PPP and enact the long pending PPP bill in Congress.”
This will also build on the working public-private partnership now taking place in coping with this crisis, most notably in the 3 T program — testing, tracing and treatment — and in helping the most vulnerable members of society cope. Something no less than the President acknowledged warmly, including with unexpected kind apologies.
Senator Grace Poe, Congressman Edgar Sarmiento, and FEF President Toti Chikiamco identified good candidates for future PPP reform and collaboration:
1) In the area of mass public transportation: PUV service contracting, and public infrastructure to support the same.
2) Open up the economy to more competition in PPP by amending the outdated Public Services Act and passing the long delayed PPP bill.
3) Bid out public health projects in various regions for services based on outcomes.
Let me also add:
4) Water projects are one of the most cost-effective public health interventions governments in developing countries can do. Peso for peso, I bet it can save more lives from prevention of deaths of common water borne diseases — dysentery, gastroenteritis, schistosomiasis, cholera, etc., vs other public health interventions, eg. the high economic cost of lockdowns to prevent mortality from COVID-19.
Incidentally, handwashing, the most potent tool vs COVID-19 together with wearing face masks, is only possible if there is water.
In this connection, I end with a wish that the limbo state of affairs in which the MWSS Water Concessions are trapped with the setting aside of the international arbitral award due to idiosyncratic regulation of an earlier administration, is sorted out soonest. This will send a clear signal, especially at this time, that the Philippines is open for investments. And that the concessionaires can continue to provide us with affordable, secure water service as they have been doing for over two decades. Something that could not be delivered by MWSS pre-PPP.
You will forgive my bias since I was involved in it as Undersecretary of the Department of Finance with oversight for Privatization in 1996. MWSS privatization, in my view, remains the best infra PPP case in terms of service delivery and mobilization of financial capital (debt and equity). Concessionaires achieved these outcomes due to their performance anchored on a credible concession contract which is now being reviewed.
Romeo L. Bernardo was finance undersecretary during the Cory Aquino and Fidel Ramos administrations.
THE Department of Education (DepEd) has issued guidelines relating to the opening of classes after the lifting of the quarantines. While there are ongoing debates as to the efficacy of these restrictions, inevitably schools need to adjust to survive. Let us examine certain problem areas in the operation of private educational institutions post-lockdown.
FACE-TO FACE CLASSES: HEALTH RISKS AND LIABILITY FOR INFECTION
The guidelines prohibit face-to-face classes earlier than Aug. 24, and from then on, face-to-face classes may be conducted only in areas allowed to open physically.
Institutions must also comply with minimum health standards that will be issued by the DepEd, consistent with guidelines of the Department of Health, the Inter-Agency Task Force for the Management of Emerging Infectious Diseases, and the Office of the President.
When a school opens classes and conducts face-to-face classes, students and faculty members are exposed to the risk of being infected by the COVID-19 virus considering that the disease is supposedly easily transmitted through physical contact between persons.
One important question is: If they do get infected, can the students and faculty members hold the school liable?
While there is no specific law yet addressing such a novel situation, the infected students and faculty members might raise the issue of negligence under our law on Quasi-Delicts. Under the pertinent Civil Code provisions on quasi-delict, as well as relevant jurisprudence, whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. In order to establish a right to recover, the claimant must establish by competent evidence the following: 1.) Damage to him or her; 2.) Negligence by act or omission of which defendant personally or some person for whose acts it must respond, was guilty; and, 3.) the Connection of cause and effect between the negligence and the damage.
Proving the first and second element is relatively an easier task as these are generally demonstrable facts. Proving the causal connection is a more difficult task. Although this virus is contagious, the contagion period remains to be determined. Recent findings showed that it is contagious even in the incubation period when the patient shows no symptoms. The virus also survives on surfaces for different time periods adding to the incident of transmission. Thus, determining accurately where a person has acquired the virus may be scientifically improbable.
Private school teachers and staff who are registered with the Social Security System (SSS) may try to claim through the existing Employees’ Compensation Program (ECP), a government program designed to provide a compensation package to public and private employees or their dependents in the event of work-related sickness, injury or death. They would need to prove that the disease is included in the occupational diseases covered by ECP.
In employee compensation cases, the claimant must adduce reasonable proof between the work of the deceased and the cause of his death, or that the risk of contracting the disease was increased by the deceased’s working conditions.
ONLINE CLASSES: ACCESSIBILITY TO EDUCATION AND POTENTIAL LOSS OF EMPLOYMENT FOR TEACHERS
Consistent with the principle of preventing infections through elimination of physical contact and interactions among persons, some experts in the field of medicine and education as well as policymakers have strongly pushed for the conduct of online classes. While this may be beneficial to some, it also puts students who have limited, faulty, or no internet access at all at a harsh disadvantage. Thus, can these students and their parents sue a school which conducts classes online exclusively?
This is arguable. The Constitution expressly provides that the State shall protect and promote the right of all citizens to quality education at all levels, and shall take appropriate steps to make such education accessible to all. Hence, a school which exclusively conducts classes online might be violating this constitutional right because as technologically savvy as present Philippine society might seem, a great number of Filipinos still do not have the means to the technology and facilities needed for the conduct of online classes.
However, this is different in the case of private schools. When education is delivered in private institutions, a contractual relationship is created between the students/parents and the schools where both parties have certain rights and obligations. A student or, in reality, a parent is free to choose which school to enroll in, bearing in mind the rules, regulations, and manner of instruction that a private school may impose.
Another possible consequence of conducting online classes exclusively is loss of employment for teachers. In the conduct of online classes, fewer teachers are required because classes can be viewed simultaneously online. Thus, in a scenario where several teaching personnel are laid off due to the existing demands and circumstances of education, can the school be held liable for illegal termination?
The scenario contemplated above is akin to the concept of Redundancy under our Labor Code. Redundancy exists when the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. Philippine jurisprudence further instructs us that a declaration of redundancy is ultimately a management decision in exercising its business judgment, and the employer is not obligated to keep in its payroll more employees than are needed for its day to-day operations, provided there is actual basis for the declaration and certain procedures are followed.
Being one of the authorized causes for termination of employment under Art. 298 of the Labor Code, a termination of a teacher’s employment due to redundancy is valid provided that the school complies with certain jurisprudential requirements i.e. 1.) written notices requirements; 2.) payment of proper separation pay; 3.) good faith in abolishing the redundant positions; and, 4.) fair and reasonable criteria in ascertaining what positions are to be declared redundant.
CONCLUSION
It is important to note that the World Health Organization (WHO) has stated that “deciding to close, partially close or reopen schools should be guided by a risk-based approach to maximize the educational and health benefit for students, teachers, staff, and the wider community, and help prevent a new outbreak of COVID-19 in the community.”
Perhaps it is equally important to determine if the guidelines issued by our government are responsive to the mandate issued by the WHO than just determining if these guidelines stop the spread of the virus. At the end of the day, there is sufficient basis for a private educational institution to open its doors for as long as it complies with minimum health standards. Private educational institutions must prioritize the health of its students and staff without jeopardizing its students’ right to quality education.
George Matthew T. Habacon is a Partner in Garcia Habacon and Han Law. He primarily handles corporate and commercial matters, commercial arbitration, as well as labor and employment matters. He is currently a lecturer at the University of Asia and the Pacific teaching Conflicts of Law.
SEEING the value of recognizing the efforts of national athletes and coaches in bringing pride and honor to the country, the Bureau of International Revenue on May 27 issued implementing regulations that provide a 20% discount in the purchase of goods and services to the former, something local sports stakeholders welcomed with open arms.
Signed by Finance Secretary Carlos Dominguez III on the recommendation of Internal Revenue Commissioner Caesar Dulay, Revenue Regulations (R.R) No. 13-2020 spur further implementation of Republic Act (R.A.) 10699, the law expanding the coverage of incentives granted to national athletes and coaches.
Under R.R. 13-2020, qualified beneficiaries will be entitled to a 20% discount on goods and services, similar to those given to senior citizens and persons with disabilities.
In turn, “business establishments granting sales discounts to national athletes and coaches on their sale of goods and/or services shall be entitled to deduct the said sales discount from their gross income,” the recently released regulation reads.
Qualified beneficiaries are those who compete in international sports competitions which do not grant prize money and must be duly recognized and accredited by the Philippine Sports Commission (PSC), the Philippine Olympic Committee (POC), the Philippine Paralympic Committee and the National Sports Associations.
The law provides discounts to national team members in the purchase of goods and services like food, medicine and sports equipment. It also grants deduction on transportation fares, room accommodations, restaurants, recreation centers, cinemas, and other amusement areas.
To ensure that such regulation is enjoyed fully by the beneficiaries, the chairman of the PSC is asked to issue a Philippine National Sports Team Identification Card and Booklet (PNSTM ID and Booklet) to the national athletes and coaches.
Benefits and privileges may be availed of by those who are qualified upon presentation of these PNSTM IDs and booklets to privately owned establishments.
The regulation will take effect 15 days after publication in the official gazette or any two nationally circulated newspapers.
The law imposes penalties of up to six years in jail and a fine of P200,000 on those caught in violation.
WELCOME DEVELOPMENT
As expected, local sports stakeholders welcome the development, looking at it as long overdue to be fully implemented.
“I am happy for our national athletes and coaches that the BIR has finally approved the implementation of this law. This will be an added incentive for our athletes and coaches who bring honor and pride to our country,” said PSC Commissioner Ramon Fernandez in an interview.
While the 20% discount for national team members was already in R.A. 10699, it was not being fully implemented, pushing athletes and officials to work hard for the strict implementation of such privilege, gaining headway in it by crafting pertinent guidelines in coordination with the BIR last year.
The release of the regulation comes at the most opportune of time as the PSC is set to slash the monthly allowance of athletes as a result of the budget cut the agency absorbed with the government making adjustments because of the impact of the coronavirus disease 2019 (COVID-19) pandemic.
“Well, of course, they should be very happy with this,” said Mr. Fernandez, believing that it could somehow cushion the impact of the cut in the monthly stipend of national team members.
He went on to say that the PSC remains committed to looking after the welfare of the athletes in these trying times.
For bemedalled triathlete and POC Athletes’ Commission officer Nikko Huelgas, the release of R.R. No. 13-2020 was a step in the right direction and about time since the proper implementation of the discount privilege has been a going concern among their ranks.
“I’m very happy to see the IRR (implementing rules and regulations) being acknowledged more and more by people from the top where they can greatly influence the [business] establishments in acknowledging this more,” said the two-time Southeast Asian Games gold medallist in a separate interview.
“Yes it (discount privilege) was [a concern] and until now. I understand that it takes time to implement such but with more awareness we can reach our goal. We will wait for the PSC to issue the booklets in addition to our new 2020 PSC IDs. It will make things easier. It’s a big stepping stone and I hope more support will come as the years go by,” he added.
And it is not only the athletes and officials who welcome it as seemingly businesses are open to the newly released regulation.
One of these is Fitspiration Philippines Corp., the company handling Gold’s Gym Philippines and UFC GYM Philippines.
“It’s a good idea. It doesn’t really have much effect on us because we even sponsor most of them. Hence if we were willing to give them our services for free then letting go of 20% is definitely something we support,” said Mylene Mendoza-Dayrit, CEO of Fitspiration. — Michael Angelo S. Murillo
ZURICH — Formula One can start its season in Austria with two races behind closed doors on July 5 and 12, the country’s health ministry said on Saturday.
The delayed championship, which was due to get going in Australia in March, has had to cancel or postpone a string of races — including the Monaco highlight — due to the COVID-19 pandemic.
The Austrian grand prix circuit, the scenic Red Bull Ring owned by the energy drink brand, is near the village of Spielberg about 200 km (124 miles) southwest of the capital Vienna.
Formula One is expected to publish a revamped calendar this week with a race in neighboring Hungary, also without spectators, following on from Austria.
Two races will then follow at Silverstone in Britain, with Hockenheim in Germany an alternative if quarantine conditions are an obstacle, with further rounds in Spain, Belgium and Italy.
The sport has said it hopes to do between 15–18 races, a reduction from the originally scheduled record 22, ending the season in Abu Dhabi in December after visiting Asia and the Americas.
Austria is among countries moving ahead with easing restrictions as coronavirus infections wane.
Formula One’s 10 teams will be limited to a maximum 80 people each at the races when the delayed season gets going in July, the governing International Automobile Federation had said on Thursday.
The numbers are likely still to exceed 1,000 with support series and marshals, medical staff and others also to be factored in.
The Austrian event organizers presented a comprehensive, professional security concept to prevent infections, the country’s health ministry said on its Website.
“The concept calls for strict hygienic measures as well as regular tests and health checks for the teams and their employees,” Health Minister Rudolf Anschober said. — Reuters
THE ULTIMATE Fighting Championship staged another live event on Sunday (Manila time) that saw Brazilian Gilbert Burns dominating American Tyron “The Chosen One” Woodley in five rounds of their headlining welterweight fight in Las Vegas.
Held at the UFC Apex Facility, “UFC Fight Night: Woodley vs. Burns” was a continuation of UFC’s efforts to move forward amid concerns over the coronavirus disease 2019 (COVID-19) pandemic.
It was the fourth event of the promotion in May after taking some time off because of the highly contagious COVID-19, which has already claimed at least 105,000 lives in the United States alone to date.
Mr. Burns was on top of things right from the opening bell en route to a convincing 50-45, 50-44 and 50-44 unanimous decision victory.
“Durinho,” as Mr. Burns is referred to, was on top of things, nearly finishing former champion Woodley in the opening round after dropping the latter on the mat and punishing him with a flurry of strikes.
Mr. Woodley was able to survive the onslaught but not after absorbing much damage, including having his left eyebrow busted open.
The Brazilian contender continued to pile up the pressure on Mr. Woodley the rest of the way, with a variety of punches and kicks, something the latter had a hard time keeping in step with.
Sensing that he got the fight in the bag, Mr. Burns tried to go for a stoppage finish in the fifth and final round but none would come as Mr. Woodley managed to hold on till the end.
With the win, 33-year-old Burns improved to 19 wins, including winning six straight, as oppose to three losses.
He expressed hope after the fight that the UFC would give a shot at the welterweight title currently held by Kamru Usman of Nigeria.
Mr. Woodley, with the loss, dropped his second straight match and fell to a record of 19-5-1.
Next for the UFC is “UFC 250” on June 6, to be headlined by the title clash between reigning women’s featherweight champion Amanda Nunes against challenger Felicia Spencer. — Michael Angelo S. Murillo
VOLLEYBALL Community Gives Back PH (VCGB PH ) has something to serve up for those matchday personnel affected by the coronavirus disease 2019 (COVID-19) pandemic.
Charo Soriano, one of the VCGB PH leaders, is looking forward to two memorable fun days from the sport’s biggest stars through the SERVE AS ONE Variety Show.
A fundraising effort for volleyball personnel presented by Volleyball Community Gives Back PH, the show is scheduled on June 5 and 6, 7:30 p.m. on the ABS-CBN Sports Website, ABS-CBN Sports Facebook Page and ABS-CBN Sports Youtube Channel.
“Time and time again, the Philippine volleyball community has exemplified solidarity in the face of various adversities — from community development, natural disaster responses, relief operations and more recently, distribution of PPEs to different provinces. Everyone helps out. And people — players, coaches, management, staff, officials, and fans — all do their part,” said Ms. Soriano.
Last month, the #CARINGFORALL: Down The Line, We Are One was launched to provide assistance for the paid-per-day personnel, as any help will go a long way.
As of last Friday, VCGB PH was able to provide 200 care packs to volleyball personnel all over Metro Manila. The group hopes to raise funds and provide care packs to be distributed for more volleyball personnel families affected by the postponement and cancellation of volleyball leagues.
And further help is on the way with the SERVE AS ONE Variety Show, with the people behind it expressing readiness and hope it would be a success.
“We wanted to reach out and help our volleyball personnel and staff and all those who made our games possible — bouncers, ball retrievers, referees, technicians all those whose livelihoods have been threatened due to COVID-19 so we came up with the idea of putting up the SERVE AS ONE Variety Show. All proceeds will go to the care packages for their families,” said Kiwi Ahomiro, who recently lent her hand in delivering personal protective equipment (PPEs) to the Philippine Army.
Also taking part in the drive is Amanda Villanueva, who hopes that the help will go a long way to boost the spirits of the volleyball game’s unsung heroes.
“In these trying times my main motivation in helping our dearest group of volleyball personnel is the vision of hope that everything will eventually come to an end. To let them know as well that we are in this together and that nobody gets left behind in life whichever direction life leads us because we are one community and we strive to help each other in whatever way we can. To stand together as one family not just on the court but also outside of the court,” said Ms. Villanueva.
Donations can be sent to Ryan Sordan through BPI bank account 8069 0632 77, GCash at 0917-5003390 and PayMaya at 0917-5003390.
To know more about the initiative, visit Volleyball Community Give Back on Facebook and @vcgbph on Instagram and Twitter for more details.
Make no mistake: Everything needs to go right before the United States Open can be held in September. It certainly doesn’t help that Winged Foot Golf Club lies smack dab in Westchester County, New York, among the areas in the United States most affected by the coronavirus disease 2019 pandemic. And even with state officials cautiously relaxing quarantine measures and, in fact, pushing for the resumption of sporting events, there is the not so insignificant hurdle of mobility. Ensuring the participation of the usual field of 156 players — who will be coming from any number of locations, including outside the country — presents unprecedented logistical concerns.
That said, US Golf Association heads bear more optimism now than early last month, when they moved the schedule from its traditional mid-June spot. Back then, holding the major tournament in abeyance looked to be a Hail Mary move; with the virus spreading fast and containment foremost in the minds of decision makers, resumption of any kind of competition was more a matter of if than when. These days, they’re confident not just of staging the Grand Slam stop, but of actually having spectators on site. In this regard, the outdoor sport lends well to physical distancing and other precautions aimed at ensuring an acceptable modicum of public health and safety.
No doubt, USGA honchos will be coordinating closely with state, local, and tour representatives. Parenthetically, they will see, and learn from, the experience of other event organizers; up first is the Charles Schwab Challenge at the Colonial Country Club in Forth Worth, Texas, next month, a veritable litmus test on how a new normal can be instituted. And, in the 13 other official events — including the PGA Championship — between then and the US Open, the hope is that continuous improvement in the conduct of tournaments occurs.
Needless to say, fans are all for the sport getting back on its feet; as the exceedingly high ratings of The Match: Champions for Charity last week underscored, they’re starving for competition. More importantly, the players themselves can’t wait to wield clubs anew; for the first time in 34 years, the Charles Schwab Challenge will be graced by the World Numbers One to Five. “Our field is deep,” event director Michael Tothe was quoted by the Fort Worth Star-Telegram as noting. “It’s really come together nicely.” Which is why the USGA believes the worst to be over, with the best about to come.
Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994. He is a consultant on strategic planning, operations and Human Resources management, corporate communications, and business development.
