How can government policies help reduce the impact of inflation on low-income families?
Answer (1)
Government policies can reduce the impact of inflation on low-income families by supporting essential needs, controlling key prices, and providing financial relief. In the Philippines, inflation hits the poor the hardest because they spend most of their income on basic needs like food, transportation, and electricity. When prices rise, they don’t have extra money to absorb the increase.One helpful policy is the Pantawid Pamilyang Pilipino Program (4Ps), which provides monthly cash assistance to qualified poor households. When inflation is high, the government can increase the amount of this aid or add a special subsidy. For example, during periods of high fuel and food prices in 2022, the Department of Social Welfare and Development (DSWD) offered ayuda or emergency cash to affected families.The government can also regulate prices of important goods. The Department of Trade and Industry (DTI) sets Suggested Retail Prices (SRP) on basic commodities like canned sardines, instant noodles, and soap. This helps prevent abuse by sellers and keeps goods affordable during inflationary periods.Another important tool is fuel subsidies for jeepney and tricycle drivers, who are directly affected by oil price hikes. These subsidies help keep public transportation fares stable, which is very important for students and workers commuting daily.The government may also implement price ceilings on essential products like rice during crises or import rice to stabilize supply and prices. In 2023, the Philippines opened rice imports to bring prices down when local supply was tight.Lastly, increasing minimum wage through the Regional Tripartite Wages and Productivity Boards is another way to help workers catch up with inflation. This ensures that wages reflect rising living costs.In summary, by combining cash assistance, subsidies, price controls, and wage adjustments, the government can soften the blow of inflation for the most vulnerable.
