Measures in place to dampen effects of oil price hikes

The Department of Finance (DOF) has assured the public that the government has put measures in place to help ease the impact of increasing oil prices. (Pixabay photo)

MANILA — The Department of Finance (DOF) has assured the public that the government has put measures in place to help ease the impact of increasing oil prices.

In a statement Monday, finance undersecretary Karl Kendrick Chua cited these social mitigation measures include the Unconditional Cash Transfer (UCT) and fuel vouchers.

As part of the Tax Reform for Acceleration and Inclusion (TRAIN) law, the government shall provide PHP200 a month for this year, and PHP300 a month in 2019 and 2020 to 10 million target recipients of the UCT — 4.4 million are from Pantawid Pamilyang Pilipino Program (4Ps), 2.6 million are indigent social pension recipients. The rest are also poor but are not under any of the two programs.

Since the government now collects higher taxes due to TRAIN law, part of its revenue shall be disbursed to poorest Filipinos through the UCT to soften the effects of rising prices.

This year, the government will release PHP24 billion to UCT beneficiaries.

Chua mentioned that the Department of Social Welfare and Development has already released some PHP4.3 billion to 1.8 million beneficiaries through the Land Bank of the Philippines. Some 2.6 million beneficiaries are set to receive their cash subsidies in May and June.

The DOF official said the Department of Transportation (DOTr) is preparing the fuel vouchers for duly-franchised public utility vehicles (PUVs) that will cushion the impact of higher oil prices.

He added that the Department of Energy (DOE) had an agreement last March with oil companies such as Pilipinas Shell, Phoenix Petroleum, and Petron to give fuel discounts to PUV drivers.

DOE data showed that as of May 22, prices of oil products range from PHP41.40 to PHP47.48 for diesel, PHP50.85 to PHP60.85 for gasoline, and PHP47.26 to PHP57.01 for kerosene.

But Chua reiterated that the TRAIN law is not the main cause of increasing oil prices but it is the geopolitical conditions in the Middle East and other global economic factors.

Chua said the increased rates in excise taxes on petroleum products may be suspended, “should the price of Dubai crude keep going up and the three-month average in the last quarter of this year hits USD80 per barrel”.

Last week, Presidential Spokesperson Harry Roque said in a radio interview that President Rodrigo Duterte already directed the DOE to study the feasibility of sourcing cheaper fuel from non-Organization of Petroleum Exporting Countries members such as Russia.

The Chief Executive likewise ordered the Department of Trade and Industry to closely monitor the local market and apprehend those violating the Price Act, particularly profiteers that are taking advantage of the current situation.

The Department of Labor and Employment will also be directed, upon the go-signal from Malacañan Palace, to discuss possible wage hikes.