THE National Economic and Development Authority (NEDA) does not support proposals to legislate higher wages, Secretary Arsenio M. Balisacan said at a House hearing on Tuesday.
“Increasing wages by legislation does more damage,” Mr. Balisacan said at a hearing of the appropriations committee in the presence of the government’s other economic managers.
He was responding to remarks by Deputy Minority Leader France L. Castro.
“Inflation keeps increasing, but our wages remain small. Our people’s purchasing power does not increase… so what can our economic managers do to increase people’s wages?” Ms. Castro told the panel.
Mr. Balisacan said that the expanding economic activity through investment can help increase wages.
“The safest thing to do is to increase wages by way of expanding economic activity, and that means a lot of investment in labor,” he said.
“It’s harmful to the economy if wages are forced to increase by legislation. If wages rise not because the demand for labor is high compared to the supply of labor, then the Philippines will be hurt (in terms of) competitiveness,” he added.
“If wages rise not because of productivity, how can we export and how can our products become more competitive? if we cannot export, we cannot increase economic activity,” he added.
Mr. Balisacan said that agriculture needs to be made more productive “by investing in the right places, farm to market roads, tech, access to markets, and not forcing increase in wages by legislation.”
Mr. Balisacan told BusinessWorld that Congress should focus on passing priority measures to address growth and inflation concerns.
“There are priority measures that need legislation. We have 10 that are supposed to be passed by end of session and 20+ more after that. (Through this we hope to) shape the next budget for 2024 in ways that are very responsive to the constraints to growth,” he said.
The Legislative-Executive Development Advisory Council said that its priority measures include the Maharlika Investment Fund bill, the proposed Internet Transactions Act/E-Commerce Law, the Salt Industry Development bill; a bill condoning unpaid amortization and interest on loans of agrarian reform beneficiaries; and a bill amending the law allowing a three-year fixed term for Armed Forces of the Philippines senior officials.
The other priority measures include amendments to the Build-Operate-Transfer Law to increase engagement via Public-Private Partnerships; and bills creating a Philippine Center for Disease Prevention and Control, a Medical Reserve Corps and a Virology Institute.
Speaker Ferdinand Martin G. Romualdez told the House panel, “I reiterate the Congress’ willingness to work hand-in-hand, to be marching in lockstep with the executive in pursuing the solutions to the economic challenges that the country faces.” — Beatriz Marie D. Cruz