Pay hike won't bust economy - Chiz

By Wilnard Bacelonia

February 13, 2024, 5:00 pm

<p>Senator Francis "Chiz" Escudero <em>(PNA file photo by Wilnard Bacelonia)</em></p>

Senator Francis "Chiz" Escudero (PNA file photo by Wilnard Bacelonia)

MANILA – Senator Francis "Chiz" Escudero on Tuesday assured that a PHP100 wage increase would not bust the economy.

Escudero allayed businessmen's hesitation in granting pay hikes, following a Senate bill that seeks a PHP100 increase in the daily minimum wage for private sector workers.

Escudero noted that whenever talks on raising the minimum wage begin, whether in Congress or on wage boards, “these are always met with the shrill warnings of these individuals that the economy will go bust if we give workers their due.”

"If some self-proclaimed business leaders had their way, wages would have remained the same for the last 40 years as they have not in one instance supported any move to raise workers’ pay," Escudero said, describing the critics of the proposed wage hike as “ivory tower individuals who love to preach about the economics of a running business when they themselves have not even managed a sari-sari store.”

“Tuwina na lang pag may diskusyon sa wage increase, maglalabas na ang mga iyan ng kanilang crystal ball at tatakutin tayo na babagsak ang ekonomiya (Everytime there are discussions on wage increase, they will bring their crystal balls out and try to scare us that the economy will go down),“ Escudero said.

Escudero also scored the contrasting reception that tax breaks for business and wage hikes for workers receive saying “they taut the steep cut in Corporate Income Tax (CIT) rates for business, saving them billions, as an economic necessity, while they treat a wage increase of a few pesos for workers, as if it were economic sabotage.”

He recalled that in 2021, the projected foregone revenues given to the moneyed class was almost PHP139 billion, "and they called it a form of economic stimuli, for the wealthy who did not ask for it.”

The lawmaker also recalled proponents of tax breaks for the rich as having argued that profits retained as a result of the lowering of the CIT will be used to retain payroll, or boost pay.

Labor groups, he said, have presented data which showed that for large firms who have racked up PHP1.1 trillion in annual profits, the cost of a PHP170 daily wage hike for their three million workers would account for about 14 percent of their profits.

For 1.8 million workers of small enterprises, the proposed wage increase is equivalent to 17 percent of their income.

"This should be debunked by oppositors, with facts, and not with the old and tired scare tactics, without proof,” Escudero said.

He, however, admitted that many microenterprises, or those with less than 10 employees and assets not exceeding PHP3 million, will be distressed by legislated pay increase which can be addressed by crafting the language of the bill "that responds to their situation.”

Another study, the senator cited, is saying that if adjusted for inflation, minimum wages across 17 regions are worth less today than in July 1989, when the last legislated nationwide wage took effect. (PNA)