KA Leody de Guzman, presidential candidate of Partido Lakas ng Masa (PLM), bared his plan for a P125-billion stimulus fund for small and micro enterprises to facilitate their recovery from the pandemic-induced economic recession.
On top of the P125-billion stimulus for 2022, Ka Leody’s wealth tax-funded recovery plan includes a public jobs generation program that will also provide a fixed wage subsidy for 1 million workers employed in distressed micro, small and medium enterprises (MSME).
“Government support for small business was lacking and not distributed efficiently at the height of the recession. Millions of workers, who lost their jobs or received lower wages and benefits, bore the brunt of the administration’s negligence to the MSME sector,” he said in Filipino.
According to the DTI, MSMEs employ about 63 percent of the labor force.
“We need to protect MSMEs because millions of workers are relying on them. They are not like big monopolies that have a larger capitalization and have a faster credit access to banks and financial institutions. Hence, the lives of livelihood of those employed in big businesses were not as threatened. Government should help small enterprises to recover from the recession without resorting to lay-offs or to diminution of wages and benefits. A vibrant MSME sector is key to the recovery of our local economy,” he added.
The P125 billion is estimated from DTI data showing that 25.9 percent of firms ceased operation and 52 percent were in partial operation in 2020, which translates to a total of P694 billion in MSME losses (with the bulk of the losses from small and micro enterprises). Accounting for recent growth after the easing of quarantine restrictions, Ka Leody’s policy team estimates that 4.67 percent of firms are still closed. This means that around P125 billion of MSME capitalization is yet to be recovered.
Ka Leody also allayed the worries of MSMEs to his “Labor First Policy”, which includes instituting a P750 national minimum wage and the abolition of all forms of contractualization.
The veteran labor leader stated: “What we are fighting for is ‘labor first’ not ‘labor only’. The next-in-line beneficiary of substantial wage hikes and regularization will be the MSME sector because Filipino will have more more purchasing power to buy from local businesses. The demand for their goods and services will correspondingly increase. To counter the tendency to increase prices with higher demand, the other pressing concerns of small business have to be addressed through government intervention, regulation, and control to power rates and fuel prices.” 30