“Ayuda” funds in the latest budget could cushion the impact of elevated inflation, Bagong Henerasyon party-list Rep. Bernadette Herrera said on Sunday.
She said the annualized inflation shot up to 5.8 percent as the December inflation rate rose to 8.1,
“One concern I have is that the elevated inflation will erode the purchasing power of the entire 2023 budget. If inflation stays elevated above 7 percent monthly, that would mean the newly-enacted 2023 budget would lose about 7 percent of its purchasing power or by approximately P368 billion,” she said.
She said the Bangko Sentral ng Pilipinas expects “upside risks continue to dominate the inflation outlook up to 2023 while remaining broadly balanced in 2024.”
“The expected upside risks to inflation over the policy horizon stem mainly from elevated international food prices due to high fertilizer prices and supply chain constraints,” she said.
On the domestic front, trade restrictions, increased prices of fruits and vegetables due to weather disturbances, higher sugar prices, pending petitions for transport fare hikes, as well as potential wage adjustments in 2023 could push inflation upwards, the BSP said.
The 2023 budget has billions for ayuda and other forms of assistance for poor and low-income families, Herrera said.
“I appeal to the agencies in charge of these funds to disburse most of the funds before the election spending ban that will come with the Barangay and SK Elections in October this year. Releasing these funds will cushion the impact of inflation not just for the poor and low-income families, but also for the small businesses they work for and interact with,” she added.