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Women in the informal sector found to be most dependent on scant gov’t aid

Jocelyn Bayubay, who sells sampaguita flower garlands in Manila, says aid and funds given by the government were insufficient.

Informal workers in Manila, especially women, struggled with hunger and unemployment after the Philippine capital and nearby cities were locked down for 90 days last year to curb virus transmission.

As a result, workers in the informal sector — from street vendors to household helpers — were forced to depend the most on government aid, said a case study that was released in March 2021. Although most informal workers received cash aid from the Social Amelioration Program (SAP), the funds were only good for one month, said the study, which consulted 70 residents in three villages in Tondo, the poorest district in Manila.

The case study — which also has a counterpart report about Tacloban City — is part of the Citizens’ Monitoring of Financing for COVID-19 Response and Recovery: Focus on the Asian Infrastructure Investment Bank (AIIB) Loan Project under the auspices of Social Watch Philippines and supported by Oxfam Pilipinas. [See: Manila Case Study]

The project examined the AIIB’s US$750-million loan to the Philippines which co-financed the COVID-19 Active Response and Expenditure Support (CARES) program. The program contains several measures to combat the pandemic’s adverse impacts, including, but not limited to, expanding medical services to step up testing and care for affected populations and providing social protection and livelihood support, especially to the most vulnerable sectors. The project also examined the SAP, which was funded by the CARES program loan that is co-financed by the AIIB.

With limited cash aid, informal workers had to rely on relief goods coming from the city government, large corporations, and non-government organizations, said the case study written by Sarah Salvador, the National Co-Chairperson of Aktibong Kilusan Tungo sa Iisang Bayan (AKTIB), one of the many partner organizations of Social Watch Philippines. Some even had to borrow money from friends and relatives just to survive, according to the case study. [See: Manila Case Study]

This exactly was the experience of Jocelyn Bayubay, a 42-year-old resident of Barangay 119, one of the three villages in Tondo, Manila selected by the case study.

Jocelyn Bayubay says she was no longer able to keep track of the number of times her family had to forego eating three times every day.

Jocelyn, who is married to a tricycle driver and has 11 children, sells garlands of sampaguita (a small, fragrant jasmine flower) for a living. One garland has a dozen or so sampaguita flowers strung together and goes for P20 (US$0.40) per set of seven. These garlands are placed in religious altars in the homes of Filipino Catholics.

Before the pandemic, Jocelyn could sell as much as 1500 flowers from seven to nine in the morning and another 800 from four to eight at night while staying on her spot right by a nearby church. However, with the ensuing lockdown and a ban on large gatherings, she only currently manages to sell 500 flowers daily three times a week — Wednesdays, Fridays, and Sundays.

During the strict three-month community quarantine, she was able to receive SAP funds twice just like most informal workers like her. She received P6,700 (US$134) during the first round and the full P8,000 (US$160) for the second.

However, the funds were barely enough for her children, the eldest of whom is a 23-year-old janitor who works for a bank but still lives with the family. Jocelyn’s youngest was born three years ago. This underscores the fact that while the SAP helped poor people’s day to day survival, because this was only provided twice — and the amounts were quite small — the money quickly ran out in a span of days.

“We just relied on the food packs given by the mayor,” Jocelyn said, adding that her family received relief packages four times for the entire period. However, each food package — five kilos of rice and several pieces of canned goods — were clearly insufficient for a family as large as hers. “If there’s no food left at the end of the day, I just give the kids P10 (US$0.20) each so that they can buy bread,” Jocelyn said. “I then let them manage on their own.”

From March to September last year, Jocelyn said she could no longer keep track of the number of times her family had to forego eating three times a day. “It was more than 20 days because it happened often enough,” Jocelyn said.

During those days, to make ends meet, Jocelyn had to run and borrow cash regularly from the elder sister of her sister-in-law who was married to someone who was working abroad. Nowadays, Jocelyn has managed to do two jobs at the same time. Besides selling flower garlands, she now helps out a friend selling food items and clothes in a nearby neighborhood market. “I’m able to pay them back little by little,” Jocelyn said. “After all, they helped me and my family survive.”

Gov’t urged to set up a more ambitious welfare program

A recipient of relief goods shows off the contents of the package she received from her local government in this photo taken last year in Manila in August 2020.

A civil society organization urged government to set up a more ambitious social protection program to provide more aid to more people affected by the pandemic, especially after authorities vowed to distribute aid to the most vulnerable sectors following another strict lockdown in the National Capital Region.

Instead of a one-off approach to providing assistance, the government should come up with a more substantive and inclusive mechanism that will provide meaningful aid to all those who need it, especially in times of disaster, according to Social Watch Philippines.

“This continuing pandemic is a wake-up call for the government to strengthen its technical capacity and administrative competence in providing social protection schemes,” Ma. Victoria Raquiza, Social Watch Philippines co-convenor, said in a statement issued a few days after another enhanced community quarantine was imposed in Metro Manila and nearby regions.

Raquiza once more issued the call for a more universal approach to social protection after Social Watch Philippines held a roundtable meeting that discussed findings of studies on government’s health, economic relief, and social protection programs.

The outputs of these welfare schemes were set by the COVID-19 Active Response and Expenditure Support (CARES) program loan that was implemented during the first year of the pandemic. CARES is co-financed by the Asian Infrastructure Investment Bank through a $750-million loan, together with other loans from the Asian Development Bank (ADB) and the Japan International Cooperation Agency (JICA). [See: AIIB COVID-19 Loan Project Brief]

During the roundtable discussion, the studies revealed that while the government managed to meet the programs’ goals — increasing testing capacity to 8,000 per day by May 2020, providing wage subsidies to those temporarily unable to work during the lockdown by December 2020, and distributing cash to vulnerable households by July 2020 — the demands for these subsidies were so huge that provisions were insufficient.

All told, the case studies’ findings showed that once more, the informal and vulnerable sectors — the very same sectors that need the most help during a disaster such as a pandemic — were not adequately provided for. [See: Case Study presentation for COVID-19 Testing and Wage Subsidies, Case Study presentation about the Social Amelioration Program]

Among the findings include:

Informal workers and disadvantaged sectors found it difficult to access COVID-19 testing, risking the possibility that they may contract, and even spread, infection.

Wage subsidies under the Department of Labor and Employment’s (DoLE) COVID-19 Adjustment Measures Program (CAMP) and the Department of Finance’s (DoF) Small Business Wage Subsidy program fell below the prevailing minimum wage and only benefitted one-third (or 658,886) of the 2.3 million workers who were temporarily dislocated during the lockdown. What is perplexing is that in spite of the urgent need to increase subsidies for workers and distribute them to as many workers as possible, the SBWS program returned P5 billion of unused funds to the national treasury in July 2020.

Households that had members who were considered vulnerable — or those families which had seniors, persons with disabilities, solo parents, and pregnant and lactating mothers, among others — only received one tranche of Social Amelioration Program (SAP) funds, even if they were entitled to receive more than one by virtue of having more than one member who was considered vulnerable. Moreover, the civil society organization said that the urgency to provide SAP assistance at the soonest possible time during the strict lockdown period could have justified an expedited validation process. The protracted validation process of beneficiaries delayed the SAP distribution. In the case of the distribution of the second tranche, the delay was about five months, which, in turn, further prolonged the agony of recipients.

The case studies have been unable to determine whether the economic relief and the wage subsidy programs helped uplift the welfare of women owing to the lack of additional gender-disaggregated data such as in the case of micro, small, and medium enterprises (MSMEs) (of which 58% were registered by women) and their workers. [See: Case Study presentation for COVID-19 Testing and Wage Subsidies, Case Study presentation about the Social Amelioration Program]

According to Social Watch Philippines, these findings show that the beneficiary targeting system employed by the government’s welfare programs risked being too narrow.

The lack of data about MSMEs, their workers, and 4Ps beneficiaries only emphasize what has been confirmed all along: that women continue to bear most of the brunt of hardship, especially during times of crisis and disaster.

With these findings, the group emphasized the need for welfare schemes to cast wider nets so that they can help more people, not only in terms of providing for their daily needs but to assist them in leading more productive and fulfilling lives, during and after the pandemic.

How the pandemic doubled the budget deficit

Major thoroughfares in Metro Manila, usually packed with vehicles day and night, are empty during the tight lockdown imposed by authorities in March 2020. The quarantine restricted trade, which cut taxes, and reduced government revenues.

Running a budget deficit is nothing new to the Philippine government. 

It has become something of a tradition that a June 2020 study said that the Philippine government ran a deficit in 17 of the last 21 years since the start of the millennium. [See: Towards sustainable tax policies]

But based on this metric alone, the Philippines is hardly an outlier — it shares the same ranking with Cambodia. 

Of nine economies examined by the study, Vietnam incurred deficits for two decades while it was 18 years for Indonesia, 21 for Malaysia, Myanmar, and Laos, 10 for Thailand, and only two for Singapore. 

In 2019, even without a pandemic, the Philippines spent more than it collected in taxes, resulting in a budget gap that reached P660 billion or 3.4% of its gross domestic product (GDP). 

That figure more than doubled in 2020, the year when the novel coronavirus disease (COVID-19) forced the country to impose what is considered as the strictest and the longest lockdowns in the world. 

In 2020, the Philippines’ budget gap reached P1.36 trillion or 7.5% of GDP, according to a BusinessWorld report dated January 21. 

Citing preliminary data announced by Department of Finance Secretary Carlos G. Dominguez in a virtual meeting, the report said that overall spending reached P4.205 trillion last year, up 11% from P3.797 trillion in 2019. The total expenditures were 0.66% below the P4.233-trillion goal.

The Finance chief said total revenues reached P2.842 trillion, down by 9.5% from P3.138 trillion a year earlier, and 0.39% short of the P2.853-trillion target. Tax collections accounted for 87.6% of the total.

Last year’s P1.36 trillion deficit was brought about by two factors: increased public spending to address COVID-19 on one hand, and lower tax collections brought about by slowing trade and reduced incomes on the other. 

In short, during 2020, overall spending went up and revenues from tax collections went down. 

Government spending increased because, among others, it “added new or expanded existing programs as part of its pandemic response,” according to a Social Watch Philippines report entitled “A Scoping Study on the Asian Infrastructure Investment Bank’s COVID-19 Loan to the Philippines.” [See: AIIB scoping study

Meanwhile, revenues — primarily from tax collections — went down because “the economy suffered due to disruptions in production, reduced incomes, and lower than expected trade and investments brought about by the pandemic,” said the study. “All these contribute to the erosion of tax base: lower GDP, higher unemployment, business closures.” 

As a result of increased spending and decreased revenues, the government had to seek fresh funding to cover the shortfall. 

In early 2020, the government was able to secure a loan package called the COVID-19 Active Response and Expenditure Support (CARES) program that was funded by the Asian Development Bank (USD1.5 billion), the Japan International Cooperation Agency (USD459 million), and the Asian Infrastructure Investment Bank (USD 750 million). 

Worth a total of USD2.71 billion, the CARES program’s expected outputs includes measures taken to combat the spread of COVID-19, distribution of funds for social protection and relief for affected people, and delivery of economic stimulus programs. 

Proceeds of the CARES loan package have already been received by the government, a Finance Department official has confirmed. 

But now, the challenge for civil society groups is to make sure that the funds from all loans — including the ones borrowed for the CARES program — are spent efficiently and effectively. 

“It is also essential to monitor the impacts of servicing these debts in tax and budget policies in the long term and to engage government into taking fiscal measures that will promote sustainable, equitable, and adequate financing for development,” the study said. 

The study added: “While borrowings are not necessarily detrimental and may even be necessary in some situations, prudent debt management is important to ensure that the people most affected by the pandemic will not bear the burden of servicing these debts.” 

COVID-19 and corporate income taxes

A retailer manages to conduct business despite the tight lockdown implemented on the Philippines’ largest island of Luzon in this photo taken in April last year.

As of this writing, a proposed law that will cut income taxes paid by corporations is awaiting the signature of President Rodrigo R. Duterte. [See: CREATE up for Duterte signature]

Once it secures presidential approval, the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) will reduce income tax rates to 25% from 30% for companies with assets P100 million and above. 

Meanwhile, a larger rate cut will be enjoyed by businesses with assets below that financial threshold. 

Companies in that category will only need to pay 20% in income taxes compared to the previous 30%. 

Those expected to enjoy these lower tax rates are micro, small, and medium-sized enterprises (MSMEs), defined as businesses with total assets of not more than P100 million. 

Based on latest data from the Philippine Statistics Authority (PSA), 99.5% of registered businesses in the country are MSMEs.

As of 2018, of the total 1,003,111 business establishments, 998,342 are MSMEs, according to the PSA. 

And just like everyone else, MSMEs were hit hard by the quarantine caused by the coronavirus. 

Last year’s lockdown has led to the temporary closure of 436,000 SMEs, the Asian Development Bank (ADB) said in a document dated April 2020. [See: ADB CARES program]

Only 117,666 MSMEs managed to remain open, the same document said. 

This is the kind of situation where lower tax rates — as indicated in CREATE — are supposed to help. 

By cutting MSMEs’ income tax rates to 20% from 30%, policy makers and officials alike are hopeful that MSMEs would stay afloat and continue operations.    

After all, MSMEs employ 63% of the country’s workforce. 

Moreover, owing to their importance, MSMEs have figured in a loan package prepared and partially funded by the ADB through a $1.5 billion facility. 

Other funders of the COVID-19 Active Response and Expenditure Support (CARES) program are the Asian Infrastructure Investment Bank (AIIB) through a $750-million loan and the Japan International Cooperation Agency (JICA) through a $459-million package. 

The AIIB loan is the focus of a citizens’ monitoring project organized by Social Watch Philippines and Oxfam Pilipinas.

One of the performance indicators of the CARES program is that by December 2020, the government — which already has availed of the loan package — should already have provided tax relief for at least one million MSMEs. 

This performance indicator raises several questions, including, but not limited to, this one: Is the tax relief envisioned in the CARES program the same one indicated in CREATE? 

If so, isn’t tax relief a policy decision where the government need not borrow money for? Or will the money borrowed for the CARES loan package used to cover a deficit that will be brought about by the tax relief? 

In October 2020, six months after the CARES program was put together, Social Watch Philippines tried to get additional details from an official who spoke about the AIIB loan during an online forum. 

However, the official only said that the AIIB loan proceeds were intended for budget support. 

This much was mentioned by a scoping study about the AIIB loan that was authored by Alvic Padilla, who is also the team lead of the citizens’ monitoring project. 

“No rigid determination on how much of the loan proceeds have been allocated to any specific agency or PAPs [programs/activities/projects],” said the study. [See: AIIB loan scoping study]

This just shows that the loans that co-financed the CARES program — especially the one from AIIB — deserves to be scrutinized further. This scrutiny is especially crucial because among the loan’s beneficiaries are MSMEs, which provide employment and has the potential to reduce poverty and inequality in the country.

While these loans may have allowed the government to finance its COVID-19 response, they nevertheless increase the country’s debt burden which will be paid for by the Filipino people. 

Borrowing new loans — especially for COVID-19 response — may indeed be necessary but the government must ensure that these are spent efficiently and effectively. 

Philippines’ COVID-19 loans increase after securing fresh funds from new creditor

Vendors such as the woman in the photograph have capitalized on the temporary shortage of and robust demand for face masks in Manila last year. In the meantime, as of December last year, the government has increased its COVID-19 financing by securing additional budget support loans.

The Philippines incurred fresh loans in December 2020 after it secured additional funds from a new creditor to help support its measures to address the coronavirus (COVID-19) pandemic.

From USD 9.914 billion in September 2020, financing agreements intended to curb the health, social, and economic effects of COVID-19 have reached USD 13.364 billion, based on December 15, 2020 data posted on the Department of Finance (DoF) website. [See: DoF: Financing secured for COVID-19 response]

The country’s COVID-19 borrowings grew by more than 30 percent after it was able to secure five new financing agreements as indicated below:

• A USD 20-million project loan financing from the World Bank (WB) Philippines FIRST Social Protection Project that started on November 10, 2020;

• A USD 580-million budgetary support financing loan from the WB Philippines Beneficiary FIRST Social Protection Project that started on November 10, 2020;

• The sale of two Republic of the Philippines bond tranches in December 10, 2020, the first worth USD 1.5 billion with a 2.650 coupon rate that will fall due in 2045 and the second worth USD 1.250 billion with a 1.648 coupon rate that will fall due on 2031;

• A USD 100-million Korea Export-Import Bank-Economic Development Cooperation Fund (EDCF) Program Loan for COVID-19 Emergency Response Program that became effective on December 7, 2020.

As expected, this new set of financing agreements have increased the number of COVID-19 loan packages that the Philippines has received so far.

From 23 loans in September 2020, the number has risen to 28, based on latest data from the DoF. [See: How much loans, grants has the Philippines received for COVID-19?]

One loan package that became effective in December 2020 came from the Korea Eximbank, making it the Philippines’ new creditor after the World Bank, the Asian Development Bank (ADB), the Japan International Cooperation Agency (JICA), the Agence Francaise de Developpment (French Development Agency), and the Asian Infrastructure Investment Bank (AIIB).

The AIIB’s COVID-19 loan to the Philippines, worth USD 750 million, was the subject of a scoping study conducted by Social Watch Philippines in partnership with Oxfam. [See: A Scoping Study on the AIIB Loan]

Entitled “A Scoping Study on the Asian Infrastructure Investment Bank’s COVID-19 Loan to the Philippines,” the report emphasized the importance of citizens’ monitoring of these loans to “help ensure that the loan proceeds are spent in the most effective, efficient, and timely manner.”

“It is also essential to monitor the impacts of servicing these debts in tax and budget policies in the long-term and to engage government into taking fiscal measures that will promote sustainable, equitable, and adequate financing for development,” the study added.

Address government underspending before borrowing new loans for COVID-19, group says

The Philippine government must first find ways to address significant underspending for COVID-19 measures before even considering to borrow new loans, a civil society group said on Thursday. 

Social Watch Philippines issued this call after it released a study authored by Alvic Padilla that looked into COVID-19-related loans from the Asian Investment Infrastructure Bank (AIIB) and Asian Development Bank. 

“We are still in a continuing disaster so there is no time to lose in providing for the needs of our people at the soonest possible time,” Padilla said on Thursday (17 December 2020), two days after it was reported that the Senate approved on final reading two measures extending the validity of the 2020 national budget and the Bayanihan to Recover as One Act (Bayanihan 2). Once enacted, these measures will allow government to spend unutilized funds from the current budget until June next year. 

Citing Department of Budget and Management (DBM) data, Padilla, in a public presentation of his study, stressed that the government spent less than what was programmed during the pandemic. [To read or download a copy of his presentation, please click here. To read or download a copy of the study itself, please click here.]

Instead of spending P3.268 trillion from January to September this year, the national government only utilized P3.022 trillion or 7.5% less than programmed, the DBM said on its website. 

As of September 2020, the government has borrowed $9.9 billion to address COVID-19, based on data from the Department of Finance (DoF).

One of these loans is the $750-million Asian Investment Infrastructure Bank (AIIB) Loan, which, in turn, was the subject of the study undertaken by SWP.

“The national government should strengthen its administrative capability to address underspending of COVID-19 loans,” said Ma. Victoria R. Raquiza, the group’s co-convenor, shortly after the public presentation of the study through an online video conferencing platform. 

This includes “addressing rigidities in the system that has delayed spending for and distribution of aid to a wide swathe of our people negatively affected by the pandemic.”

According to Raquiza, slower fund use is exemplified by the Department of Social Welfare and Development (DSWD), the primary agency in charge of providing aid and relief to the most vulnerable groups. In November, it was reported that the agency failed to utilize its P83-billion allotment for this year, she said.

Raquiza, also a professor at the National College of Public Administration and Governance at the University of the Philippines, reiterated that there is a need to balance the prudent use of funds with the need to be more flexible and lenient in the application of certain rules in order to expedite and fast-track the release of funds for COVID-19 programs. Unless these adjustments are undertaken, then underspending may continue. 

Meanwhile, Padilla’s report entitled “A Scoping Study on the Asian Infrastructure Investment Bank’s COVID-19 Loan to the Philippines,” also called on the government and its creditors to “provide and broaden meaningful spaces” that will allow citizens’ groups to keep better track of the use and effectiveness of COVID-19 loans. 

Once these spaces are made more open and participatory, citizens will be able to “unpack and analyze the performance of agencies implementing critical COVID-19 measures on health, social protection, and economic relief for vulnerable groups,” Padilla’s study said. 

“Citizens’ monitoring of these loans will help ensure that the loan proceeds are spent in the most effective, efficient, and timely manner,” the study said. “It is also essential to monitor the impacts of servicing these debts in tax and budget policies in the long-term and to engage government into taking fiscal measures that will promote sustainable, equitable, and adequate financing for development.” 

Gov’t borrowed money for hazard pay, study says

Health workers express demands for hazard pay during a demonstration held in November 2020 in Manila. (Photo by All UP Workers Union-Manila)

The Philippine government borrowed money to cover the hazard pay of health workers. 

This, among others, was one of several findings of a study that examined one of the many loans that the government incurred for its COVID-19 response. 

Entitled “A Scoping Study on the Asian Infrastructure Investment Bank’s COVID-19 Loan to the Philippines,” the study was undertaken by a special team under civil society group Social Watch Philippines (SWP).  [Download the study here.]

The USD750 million loan agreement between the Philippines and the AIIB sets performance targets of the government’s COVID-19 response measures. The AIIB loan, in turn, forms part of the Asian Development Bank’s COVID-19 Active Response and Expenditure Support (CARES) Program. [See: ADB Gender Monitoring Matrix]

This table is part of the Gender Monitoring Matrix of the Asian Development Bank’s CARES program. ADB Gender Monitoring Matrix]

One of the expected outputs of the ADB CARES program — as indicated in its Gender Monitoring Matrix — is that the government is expected to ensure that “by October 2020, frontline health workers, of whom 75% are women, should already enjoy health insurance coverage through PhilHealth, receive a special risk allowance of 25% of salary plus hazard pay, P100,000 compensation for severe infection, and a P1 million benefit in case of death.”

These findings indicate that the government has raised substantial cash to cover hazard pay of health workers, among others. 

As of September 2020, the government’s total debts for its COVID-19 response has reached USD 9.914 billion, the study said. 

With government’s substantial borrowing for COVID-19, the study called on civil society groups to further monitor how these funds are used. 

“Citizens’ monitoring of these loans will help ensure that the loan proceeds are spent in the most effective, efficient, and timely manner. It is also essential to monitor the impacts of servicing these debts in tax and budget policies in the long-term and to engage government into taking fiscal measures that will promote sustainable, equitable, and adequate financing for development,” the study said.  

Proceeds from these loans should also be used efficiently and should be properly accounted for, the study said. 

“Transparency and accountability on COVID-19 loans are crucial because any misuse, abuse, or wastage will have dire human and social consequences,” the study said. 

It added: “While borrowings are not necessarily detrimental, and may even be necessary in some situations, prudent debt management is important to ensure that people most affected by the pandemic will not bear the burden of servicing these debts.”

New study seeks further monitoring of COVID-19 programs to help ensure effectiveness, transparency

Health workers hold a rally to seek the release of their hazard pay in this photo taken in November 2020 in Manila. The provision and release of hazard pay are among the expected outputs that the government must comply with as part of its Covid-19 loan agreements. (Photo from All UP Workers Union-Manila)

Civil society groups should further monitor how government agencies use budgets and deploy measures against the pandemic, especially since the country borrowed billions of dollars to fund these programs.

This was among the several recommendations of a newly-released study that examined the Asian Infrastructure Investment Bank’s COVID-19 loan to the Philippines. [Download study here.]

“Citizens must further unpack and analyze the performance of agencies in implementation of critical COVID-19 response measures on health, social protection, and economic relief for vulnerable groups,” said the study entitled “A Scoping Study on the Asian Infrastructure Investment Bank’s COVID-19 Loan to the Philippines.”

Released in early December 2020, the study was undertaken by a special team put together by civil society organization Social Watch Philippines. [See: AIIB Loan Project Brief]

The AIIB loan forms part of the Asian Development Bank’s COVID-19 Active Response and Expenditure Support (CARES) Program. [See: ADB Cares program]

Worth USD750 million, the AIIB loan is just a portion of the total USD9.9 billion that the Philippines borrowed to mitigate the health and socio-economic effects of the pandemic. [See: List of the Philippines’ COVID-19 loans]

Unlike the Philippines’ previous borrowings, the AIIB loan does not have any conditions but sets expected outputs of COVID-19 programs.

One of the loan’s expected health outputs is that by July 2020, turnaround time for coronavirus testing from sample collection to the generation of results should be reduced to 48 hours or less.


Citizens and groups interested in checking how COVID-19 loans are spent should also “look at effectiveness and efficiency in the delivery of specific programs, identifying implementation (including targeting) issues…”

Other recommendations including examining the effectiveness of COVID-19-related programs at the local level, accounting for fiscal and economic impacts of COVID-19 financing, and the effects of the coronavirus measures on the lives of women.

“Transparency and accountability on COVID-19 loans are crucial because any misuse, abuse, or wastage will have dire human and social consequences,” the study said.

It added: “While borrowings are not necessarily detrimental, and may even be necessary in some situations, prudent debt management is important to ensure that people most affected by the pandemic will not bear the burden of servicing these debts.”

Hazard pay and COVID-19 loans

Photo from the All-UP Workers Union-Manila

Health workers held a picket last November 20, 2020 at the Philippine General Hospital in Manila to protest the delayed release of their hazard pay of P500 a day.

The protest action was organized after “six months of waiting,” said the workers’ union of the University of the Philippines Manila-Philippine General Hospital in a statement emailed to media.

Photo from All UP Workers Union-Manila

Last March 2020, President Rodrigo Duterte signed Administrative Order 26 that entitles government personnel “whose services are urgently necessary and who physically report for work during the period of an Enhanced Community Quarantine and are inevitably exposed to health risks and hazards” to receive hazard pay. [SEE: AO 26]

The provision of hazard pay is one of the indicators that the government must comply with as part of its Covid-19 loan agreement with the Asian Development Bank (ADB).

From the Gender Monitoring Matrix of the ADB CARES Program [SEE: Gender Monitoring Matrix]

This is indicated in the Gender Monitoring Matrix of the ADB Covid-19 Active Response and Expenditure Support (CARES) Program.

Based on the matrix, the government is expected to ensure that by October 2020, frontline health workers, of whom 75% are women, should already enjoy health insurance coverage through PhilHealth, receive a special risk allowance of 25% of salary plus hazard pay, P100,000 compensation for severe infection, and a P1 million benefit in case of death. [SEE: Gender Monitoring Matrix, ADB CARES Program]

The $1.5-billion ADB CARES program is co-financed by the Beijing-headquartered Asian Infrastructure Investment Bank (AIIB) through a separate $750-million loan that forms part of the total debts incurred and grants received by the Philippines to address the coronavirus pandemic.

Photo from the All UP Workers Union-Manila

As of late September 2020, the Philippines’ financing to address the pandemic has reached more than $9 billion. [SEE: How much loans, grants has the Philippines received to address Covid-19?]

To help track these the Philippines’ Covid-19 loans, Social Watch Philippines has launched a special project, the Citizens’ Monitoring of Financing for Covid-19 Response and Recovery: Focus on the AIIB Loan, that helps monitor the $750-million AIIB Loan. [SEE: Project Brief]

LIST | How much loans, grants has the Philippines received to address Covid-19?

A senior citizen waits for her turn to receive assistance while in line in this file photo taken in Manila in October 2020. (Photo by Bernard Testa)

The Philippines was able to borrow money, receive grants, and secure funding for several programs as part of its initiatives to address Covid-19.

As of September 28, 2020, loans, grant assistance, and budgetary support financing received by the Philippines have reached a total of $9.914 billion, based on data collected by a Social Watch Philippines. (SWP) team working on a special Covid-19 loan-related project.

Financing secured for COVID-19 Response
(As of September 28, 2020)


ParticularsAmount in USD million
WB Third Disaster Risk Management Development Policy Loan500.00
ADB COVID-19 Active Response and Expenditure Support Program1,500.00
ADB Social Protection Support Project – Second Additional Financing200.00
ROP Bonds Due 2045 with 2.950% coupon1,350.00
ROP Bonds Due 2030 with 2.457% coupon1,000.00
WB Emergency COVID-19 Response Development Policy Loan500.00
ADB Support to Capital Market Generated Infrastructure Financing, Subprogram 1400.00
AIIB CARES Program750.00
AFD Expanding Private Participation in Infrastructure Program, Subprogram 2165.42
AFD Inclusive Finance Development Program, Subprogram 1110.28
ADB Expanded Social Assistance Program500.00
JICA COVID-19 Crisis Response Emergency Support Loan458.95
ADB Competitive and Inclusive Agriculture Development Program, Subprogram 1400.00
ADB Inclusive Finance Development Program, Subprogram 2300.00
JICA Post Disaster Standby Loan (Phase 2)458.95
ADB Disaster Resilience Improvement Program500.00
WB Social Welfare Development and Reform Project II – Additional Financing200.00
Subtotal, Budgetary Suppport Financing9,293.60
ADB COVID-19 Emergency Response Project3.00
ADB Rapid Emergency Supplies Provision5.00
Government of Japan Non-Project Grant Aid for the Provision of Medical Equipment of DOH18.36
Subtotal, Grant Assistance26.36
WB COVID-19 Emergency Response Project100.00
WB Support to Parcelization of Lands for Individual Titling Project370.00
ADB Health System Enhancement to Adddress and Limit COVID-19 Program125.00
Subtotal, Project Loan Financing595.00
TOTAL9,914.96

Funds came from the World Bank, the Asian Development Bank (ADB), the Japanese government, the Japan International Cooperation Agency (JICA), the Agence Francaise. de Developpment (French Development Agency), and the Asian Infrastructure Investment Bank (AIIB).

Besides the World Bank and the ADB, the Beijing-headquartered AIIB emerged as one of the bigger lenders of the Philippine government.

Through its $750-million loan, the AIIB co-financed the ADB’s Covid-19 Active Response and Expenditure Support (CARES) program.

This list of loans was compiled as part of the team’s work in relation to the Citizens’ Monitoring of Financing for Covid-19 Response and Recovery: Focus on the AIIB Loan.

The project’s team leader, Alvic Padilla, talked about the relevance of the project during his presentation at an online roundtable briefing organized by SWP held late October.

“Through this project, citizens will have a better understanding of how the loan would be used and spent,” Padilla said during the event, which was attended by officials from the Department of Finance, Department of Social Welfare and Development, Department of Health, Department of Labor, and the Philippine Commission on Women. [SEE: Briefing on the AIIB Covid-19 Loan]

His remarks echoed the explanations contained in the project brief. [SEE: Project Brief]

“Prudent debt management is important to ensure that people most affected by the pandemic will not bear the burden of servicing these debts,” the project brief said.

“Citizens need to monitor and ensure that Covid-19 loan proceeds are spent in the most effective, efficient, and timely manner because any misuse, abuse, or wastage will have dire human and social consequences.”