Press Release
August 9, 2021

Sen. Grace Poe's interview transcript on plight of MSMEs in pandemic

Monday, Aug. 9, 2021
12:15-12:35 p.m.

Karmina Constantino: Senator, the picture is clear. The MSMEs, they're not just taking a hit. I mean, if you look at big businesses that are forced to close down because of this pandemic, what more the MSMEs? So I guess the question is, how can a probe at this point into how the pandemic had impacted on these MSMEs help, Senator?

Sen. Grace Poe: I think it's important to bring the leaders of the industry of the different sectors, particularly the MSMEs, on a discussion, an open discussion and I think the Senate can bring that about to really hear from them the plight of the MSMEs. I'm sure that there have been other discussions in the Senate, but the focus of this will be about why it is crucial for MSMEs to have representation in the IATF. The IATF at this point has been focused on the health situation of the country, which is, of course, very important. We have some experts from the health industry, we also have the local government representation for the ground, and we also have, of course, the members of the executive. Every now and then, presidential adviser Joey Concepcion sits in with the IATF to give their recommendation. But as we know, since the focus has been on health, sometimes we tend to forget that the economic health of our country is also very important. Of course, we can't work if we're sick. But if we're not sick and we're not able to work, then that's also crucial for survival. It affects the survival of many of our countrymen. So it's important that we have an IATF focused on economic recovery. Now, why is this important? MSMEs in particular compose 99 percent of businesses in the country, we know that. That's about a million businesses and about five million people at the minimum rely on these MSMEs. Now at this point, 10 percent of the MSMEs already shut down, they're predicting about 16 percent more, or up until 16 percent this year alone. And we've seen that in the past weeks the very abrupt decisions and policies of the IATF on the closures of business have really negatively impacted many of the small business owners, particularly, and this is my focus because I've had a chance to interact with some of them—the food and beverage industry. I think they found out about the GCQ with restrictions on the 29th, and they were supposed to shut down on the 30th. Nakapamalengke na ang mga may-ari ng mga restaurants na ito. Remember that's toward the weekend. So gaano karaming pagkain ang nasayang dahil bigla na lang sinabi ng IATF, "Wala nang dine-in whatsoever". Now, they are all in agreement that a lockdown—perhaps to stall the spread of the virus—is necessary, but at least give them some lead time. And I think the reason why this came about is there's really no direct line of communication between the policy makers, the IATF, and the small business owners. Joey Concepcion is doing his best, but he's representing millions of people dependent on MSMEs. Remember, what composes MSMEs? We have wholesale and retail, we have manufacturing, we have food and beverage as well as accommodations and other businesses, so that's a lot. And so, they really need a voice and representation. Otherwise, arbitrary rules will be made to the detriment of not only the owners of these businesses but their employees as well.

Constantino: Senator, here's the thing though, the government seems to think that their pandemic response has been stellar, right? So how do you even think that a probe like this can help them change their mind and provide a seat to represent MSMEs? They seem to think that they're doing a good job.

Poe: Well, I really don't know, maybe the pronouncements of some of their allies and their secretaries have been that. There's no denying that in other countries, they're suffering from the surge of this pandemic. I mean, even in the US alone, policies change every now and then. But of course, their economy is more resilient than ours. That's why we really need more informed decisions from those directly affected by the pandemic. I hope that they would listen. When there's a probe in the Senate, at least it brings to light the issues. I mean, more people are made aware of it. I have some friends who own restaurants and in fact, they were shocked. They found out on the 29th that they had to close the next day. So it's not very clear. Some are even suggesting, dapat may direct Viber group ng MSMEs kasama ang IATF. Now, I don't know if that's in existence, but the fact of the matter is, many of those MSMEs are not. Business owners are not really aware that there's going to be a lockdown the following day until the very last minute and they've already planned for the entire week. Remember, the weekend can make or break some businesses. And so, while they're in agreement that we should have some sort of a lockdown, a good lead time will be very important. And another thing is of course, in other countries they've already reached the herd immunity that is ideal. Of course, here in our country, we have not. But we should already have a roadmap. If we are nearing toward herd immunity, what would our policies be? And right now, we are seeing that some business owners are going above and beyond making sure that their employees are all vaccinated. I know that there are some restaurants, and I know the owners, who delay their opening until all of their employees, including the security guards, including the maintenance workers, are vaccinated, not just the chefs and the workers... So business owners are doing their best to be able to comply so it would be good for them to know also from the government what the policies would be moving forward, what the contingencies are in cases of surge, what lead time are they expecting, instead of some unpredictable and sometimes quite arbitrary policies.

Constantino: Not to mention, Senator, most of these MSMEs that we're talking about are not connected online. Because some were able to turn around, some were able to evolve quite quickly that they were able to change their business into an online business. They have deliveries, they have fiber but most of these MSMEs that we are talking about really are not that connected. So 'yung sinasabi niyo po kanina na nasayang, 'yung pinamalengke, 'yung pinamili, that's really very real to them because they weren't able to turn things around as quickly as some businesses could.

Poe: Of course, because there's really a difference even if let's say you've adapted and you do deliveries already like many restaurants. The fact is if you are anticipating at least 20-percent indoor dining and 50-percent outdoor dining, the logistics are different. How much are you going to buy? As opposed to, if you were only expecting deliveries. So that was a weekend where a lot of indoor dining were expected and at the very last minute they said, that's no longer possible. What they were really tuned in on was the ECQ that was going to follow which was August 6 to August 20.That's where their mindset was. They didn't expect that there would be an earlier lockdown for them, so they've already prepared for that weekend. So kahit sabihin mo na marami sa kanilang nag-dedelivery, siyempre dahil may at least 20 percent indoor dining, 50 percent outdoor dining, iba 'yung kanilang mga pinamili para sa mga araw na darating na 'yun. Kaya simple lang naman 'yung kanilang hinihingi, "Sana bigyan niyo naman kami ng kahit man lang isang linggong palugit para makapaghanda kami ng maayos". Hindi naman siguro masama 'yun na hingin sa ating mga namumuno at sa ehekutibo.

Constantino: And Senator, we're just talking about the business owners here. We haven't talked about their workers yet. I mean, if you look at the numbers, Senator, the numbers are quite staggering.This is coming from Socio-economic planning Sec. Karl Chua, more than 600,000 workers will be affected by the lockdown right now. And some work for big businesses, some work for MSMEs, and a portion of these workers that we're looking at, Senator, are at risk of permanently losing their jobs. What can the government do at this point? Sabihin na nating hindi pa natin.. hindi pa nangyayari iyang probe po ninyo. What could government do at this point to salvage the situation?

Poe: Of course, we at the Senate pushed for Bayanihan 1 and 2, now we're pushing for Bayanihan 3. At least to have some sort of direct financial assistance for those who've lost their jobs. Remember, I think we've had what, 16 months of lockdown? And if you were making, let's say P20,000 a month, that's on the high average end already. P20,000 would probably be about more than P300,000 for that lockdown. But those people only receive P16,000, so that's about five percent of what they usually make. Remember ang ayuda P16,000 lang kasi two months 'yun 'e, and this is NCR. It's in the lower end outside of NCR. So if you're making P350,000 in those 16 months, you're making less than five percent of what you used to make. Now restaurant owners, let's say their base is about P10,000 for their waiters, they rely on tips and service charges which is about P8,000. So even if let's say these restaurant owners, which is really difficult, let's say you have 2,000 employees. How can you pay them even a minimum of P4,000 a month even if you're not in operation? What could the government do? So we have the Bayanihan and hopefully now there will be more direct financial assistance. The government said that they're releasing through DBM P10 billion, that's well and good. But remember, P30 billion is lost in this two-week lockdown alone on wages so that's quite not enough... On the other hand, as committee chair of banks and financial institutions, we passed the Financial Institutions Strategic Transfer Act which will allow banks and financial institutions to sell their non-performing assets and loans so that it will free up capital and they will be able to loan it to MSMEs. Now, it's also important that the Landbank and the DBP actually act as a government bank and give to small enterprises as opposed to acting like a commercial bank. At this time, if we look at the loan portfolio of the Landbank and the DBP, we'd also like to explore where they used up the loans that they've given. Are they helping MSMEs? So these are the things that we can look into now. But moving forward, we need a more holistic and informed decision by including those in the MSMEs at the table of the decision-making process of the executive.

Constantino: Senator, you said in your statement over the weekend, and I quote ' We need to be at least one step ahead because every lockdown can feel like taking two steps back.' Again, I go to the figures released by Socio-economic planning Sec. Karl Chua, in the lockdown this time around, ECQ season 3, we're looking at poor Filipinos increasing by 250,000. That's just not two-step backs, those figures are staggering. So I guess the question is, what is, you've conducted these hearings, you know what's going on, what is your assessment? What is preventing the government from being proactive, from looking at the future, what can possibly happen, Senator?

Poe: If you say that I know what's going on, I'll admit to you we don't really know what's going on all the time. I mean we ourselves in the legislative branch are sometimes in the dark also as to what the current policies are of the executive. Now, this is new for everybody but we've already seen examples in other country. One of the things that I proposed when we were deliberating Bayanihan 2 and then we were tackling the funding for the vaccines was having a vaccine passport at that point. And I was saying it needs to be standardized because when our countrymen travel abroad, especially the OFWs, it's hard to show one from their munisipyo that's not been authenticated, if it's not standardized. Unfortunately, there was a hurdle amongst ourselves, those weighing the rights of people not to be discriminated upon. Anyway, fast forward, now when you travel abroad, let's say a friend of mine was travelling abroad and in some venues there they require an authenticated vaccine card. And you can only get that from the Bureau of Quarantine here in the Philippines because it's not standard yet. So it's difficult because you have to make an appointment, it takes weeks to get an appointment. What if your trip is already in the next two weeks? So it's not a very well-oiled machine that we have right now, and I don't know, I'm not really in the know because I don't have a seat at the table of the IATF. Even the Senate itself, yes we approved the budgets, we legislate but when it comes to executive decisions we are not consulted regularly about those things.

Constantino: Should you be, Senator? What do you think? Should the Senate have a seat there? Should the Senate have a say?

Poe: I don't want to add a layer of bureaucracy to anything but what I'm saying is the Senate can help within our purview, by conducting these hearings and submitting those recommendations to the executive. That's why that's what we are doing. We're not going to insist, 'Give us a seat at that table.' We have our own mandate, we will work within that mandate. But with them, I think it's incumbent upon them to be inclusive in their consultations. We don't have to have 100 people at the table, we just need to have a representative, let's say in the PCCI, a representative of the restaurant's group... with regard to the plight of the restaurant sector. I don't think it's too much to ask to have that. We're not even saying 'include the Senate there.' But definitely, the Senate, I feel it is incumbent upon us to include these stakeholders in a discussion so that we can have a comprehensive recommendation to give the IATF and hopefully, they will consider that...

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