Senate sees sufficient funding for Universal Health Care program

MANILA, Philippines — Senators have assured the public of sufficient funding for the implementation of the Universal Health Care (UHC) program even as Congress is still drafting a final version of the bill raising tobacco taxes anew.

The Senate and House of Representatives earlier included funding from the Philippine Amusement and Gaming Corp. (Pagcor) and Philippine Charity Sweepstakes Office (PCSO) for the UHC in the P3.7-trillion General Appropriations Bill for 2019 that it passed earlier this month.

“There will be funds available for UHC,” Sen. JV Ejercito, who is pushing for a P90 additional tax per pack for cigarettes, said in a radio interview.

Ejercito also said the additional P18 billion “savings” that were discovered during deliberations of the proposed national budget for this year will further boost the UHC.

This is contrary to the repeated claims of health advocates, Department of Finance (DOF) and Department of Health (DOH) that the non-passage of higher tobacco tax would imperil the effective roll out of the UHC.

“To the tobacco industry, don’t think we are charging everything from you. We will find the sweet spot. We do not want to kill the industry. We understand that hundreds of thousands depend on the industry for their livelihood,” Ejercito said during previous hearings on the proposed increase in tobacco excise tax.

Senate President Vicente Sotto III earlier clarified that with or without sin taxes, there is enough budget for the implementation of the UHC, which would entail a hefty amount of P257 billion on its first year of implementation.

DOF and DOH officials have claimed that the UHC is short of P40 billion for its first year of implementation.

The UHC listed the following as sources of appropriations for its implementation: incremental sin tax collections: 50 percent national government share from Pagcor; 40 percent from documentary stamp payments and mandatory contributions from PCSO; premium contributions from PhilHealth members; and annual appropriations of the DOH from the General Appropriations Act.

“Let us put it this way: it is not imperative to pass higher tobacco tax just to be able to implement the UHC program of the government. The program can be implemented even if we’ll not able to pass it in the 17th Congress,” Sotto said.

Congress will have only three weeks of session in May before finally adjourning in June.

The Senate ways and means committee, chaired by Sen. Sonny Angara, is finalizing draft bills on raising excise taxes on tobacco and alcohol products.

The UHC bill, a priority of President Duterte, is ready to be signed into law.

 Senate President Pro Tempore Ralph Recto has also said instead of relying on tobacco tax to fund a big part of UHC, the government may consider other tax sources such as adjusting sugar tax that could translate to P5 billion in additional revenues.

Recto said on top of their earmarked funds for UHC, Pagcor could still add P5 billion while PCSO could afford to donate an additional P10 billion.    

The Senate leader said the government could also get extra funds if PhilHealth would lessen its fraudulent claims, which could lead to P5 billion in saved premiums.

Angara said even if the Senate failed to put out its own tobacco tax bill, “there is an agreement in principle to increase the excise tax on tobacco products in order to raise funds for the UHC bill and substantially reduce the smoking prevalence among the youth.”

He disclosed that “there is no consensus yet on the final tax rate.”

Angara stressed that the committee is also inclined to increase the penalties against illicit tobacco trade to give more teeth to the law.

He said the Senate would take up the unfinished bill, including outing the final committee report, when it resumes session after the May 13 elections.

Health and anti-tobacco groups have threatened to deny re-electionist lawmakers of five million votes for allegedly sitting on the proposed hike in tobacco tax.

Smokers, who now number at 16 million, will absorb the cost of the tobacco tax increase once Congress approves the proposed P60 per pack tax on cigarettes.