AS OIL PRICE HIKES CONTINUE : PUBLIC FACES HIGHER COST OF LIVING, MORE ERODED WAGES AND INCOME

The public is facing higher cost of living and more eroded wages and income this year as oil prices continue to spiral, according to independent think-tank IBON Foundation.

Jeepney drivers, for instance, will have to work doubly hard to earn a decent income for their families with unabated diesel price hikes. Last year alone, a jeepney driver’s daily expense for diesel increased by P147.30 as the prevailing pump price of diesel jumped by P4.91 per liter between January and November 2007. (Based on transport group Piston’s estimate that a jeepney driver consumes an average of 30 liters of diesel per day)

Diesel costs jeepney drivers around P1,125.90 per day and has to hand over between P600 to P900 (depending on the unit’s seating capacity) as daily “boundary” to the jeepney owner or operator. This means that he can only start earning for his family if he has already made P1,725.90 to P2,025.90 to cover for the diesel cost and the operator’s share.

Ordinary households, meanwhile, are spending P76.94 more for a regular LPG tank (11-kg cylinder) as the prevailing price of LPG jumped by P3.91 per liter between January and November 2007. Again, this further undermines the budgets of most Filipino families who also face higher water and electricity monthly bills as well as increased prices of basic goods.

IBON welcomes the proposal of several senators to suspend the 12-percent value added tax (VAT) on petroleum products because this will offer a temporary respite for the public. Diesel pump price, for example, could immediately go down by around P4.50 per liter without the VAT.

However, the situation calls for drastic but doable measures that are more effective and stable such as the permanent lifting of the VAT on oil products and the immediate repeal of Republic Act 8479 or the Oil Deregulation Law.

IBON will present its assessment of the economic and political situation at the Yearend Birdtalk on January 14, 1 p.m. at the UP Balay Kalinaw, Diliman, Quezon City.

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