Inequality gaps widen during the pandemic: IBON report

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·3 min read
FILE PHOTO: Homeless people, including children, queue to receive free meals distributed by members of the Society of the Divine Word (SVD) on December 15, 2020 in Manila, Philippines. The COVID-19 pandemic will make 2.7 million more Filipinos poor this year on top of a record slide in the Philippines gross domestic product (GDP), the World Bank said. Economic think tank IBON reported that the poorest 70-80% of Filipinos were denied right to development, widening the inequality gaps in the country. (Photo by Ezra Acayan/Getty Images)
FILE PHOTO: Homeless people, including children, queue to receive free meals distributed by members of the Society of the Divine Word (SVD) on December 15, 2020 in Manila, Philippines. The COVID-19 pandemic will make 2.7 million more Filipinos poor this year on top of a record slide in the Philippines gross domestic product (GDP), the World Bank said. Economic think tank IBON reported that the poorest 70-80% of Filipinos were denied right to development, widening the inequality gaps in the country. (Photo by Ezra Acayan/Getty Images)

The poorest 70-80% of Filipinos are denied their right to development, widening the inequality gaps, economic think tank IBON pointed out in a March 2022 civil society report.

Additionally, IBON emphasized that government economic policies continue to favor “super-rich” oligarchs and large corporations.

The independent think tank also underscored the government’s “gross fiscal mispriorities” of underspending on emergency economic relief to families and small businesses in favor of overspending on infrastructure, debt servicing, and military expenditure.

The report, which highlights the state of key economic, social and cultural rights in the Philippines, was submitted by IBON to the United Nations (UN) Office of the High Commissioner on Human Rights as part of the 41st session of the working group on the Universal Periodic Review (UPR) in the United Nations Human Rights Council.

The March 2022 report also gave the international body information on the Duterte administration’s policies and lockdown-heavy pandemic response and how it worsened pre-pandemic economic decline, IBON said.

IBON cited the Duterte administration’s over-reliance on lockdowns and lackluster support for fiscal stimulus as primary reasons for the worsening poverty situation in the Philippines.

“Spending priorities continued to be distorted, with the amount spent on the COVID-19 response grossly disproportionate to the scale of the social, health and economic crises. The Department of Budget and Management (DBM) reports P616 ($11.9) billion in COVID-19 releases in 2020 and 2021; this is actually even less than the P717 billion allotted for COVID-19, meaning that the government even spent 14% less than what was allotted for COVID-19. On the other hand, over that same period, the government spent P1.9 trillion on infrastructure projects (mainly transport-related) and P2.3 trillion on debt servicing consisting of interest and principal payments,” IBON stated in their report.

IBON highlighted that the Philippine government acknowledged the severity of economic distress, but argued that there were no fiscal resources for further cash assistance.

Moreover, IBON reported that only a handful of Filipinos were able to accumulate wealth while millions were denied their basic right to development. Citing data from Credit Suisse and Forbes, IBON estimated that 2,919 local billionaires, which comprises less than 0.003% of the population, have a cumulative net worth of P8.1 trillion as of 2020 and hold 16% of the nation’s total wealth.

IBON pointed out that the worsening inequality was also due to the Duterte administration’s regressive economic policies. IBON cited the increased consumption taxes on the poor and middle class and reduced income taxes on large corporations enabled by the Tax Reform for Acceleration and Inclusion Law (TRAIN) and Corporate Recovery and Tax Incentives for Enterprises (CREATE) as regressive policies of the government.

Basti Evangelista is a news and opinion writer who focuses on Philippine national politics and sectoral issues. His personal advocacy includes press freedom and social justice.

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