Wage subsidy to prop up MSMEs proposed

A legislator is urging the government to come up with emergency wage subsidy for the employees working at micro, small and medium enterprises (MSMEs) to help them cope with the coronavirus disease (COVID-19).

Bagong Henerasyon Rep. Bernadette Herrera underscored the need to provide subsidy to the MSME workers who are also experiencing difficulties.

An emergency wage subsidy program designed for MSMEs could maintain an employment connection and ensure income for affected employees even if they are not working due to the Luzon-wide enhanced community quarantine.

“The idea behind this proposed wage subsidy program is to preserve jobs as we help MSMEs keep workers on their payroll amid the challenges posed by the COVID-19 pandemic,” Herrera said.

Under her proposal, Herrera seeks a payroll support for MSMEs for two months based on the prescribed minimum wage of workers by region.

“A payroll support for two months equivalent to the minimum wage by region is reasonable, but not for an extended period of time,” Herrera said.

A payroll subsidy is one way of giving back to the MSME sector that substantially contributes to the country’s economic growth, accounting for 99.52 percent of established businesses and employs 63.19 percent of the nation’s workforce.

“We must understand that MSMEs generate most of the jobs for ordinary Filipinos and also they’ve got their share of GDP. And if only for the equity aspect of it, it will be critical to prop them up in difficult times, such as this ongoing coronavirus crisis,” the lady solon said.

A wage subsidy, Herrera said, would not only prevent job losses, but also help small businesses to easily resume normal operations following the crisis.