What COA Found
The SBWS Program aims to provide immediate relief to employees in the formal economy sector affected by the imposition of the enhanced community quarantine to address the COVID-19 public health emergency. The use of digital platform facilitated the processing of applications and timely release of wage subsidies amounting to ₱45.1 billion or 89 percent of the allocated budget of ₱51 billion. Out of the 3.4 million target number of employees, a total of 3.1 million or 91 percent received wage subsidies from April 29, 2020, to June 25, 2020. Nevertheless, critical challenges in the program implementation affected the efficiency and effectiveness of the program.
The program’s target to reach out and help affected employees in the small businesses, whose businesses did not full operate during lockdowns, fell short by 41 percent or about 717,442 employees. On the other hand, the program had fully served the target number of employees in the quasi-essential businesses with skeletal force and even exceeded by 25 percent or 412,077 employees. Moreover, the program did not cover the employees belonging to the essential categories affected by the imposition of community quarantine. The SSS confirmed that one of the factors affecting the attainment of the target was information dissemination.
Why COA did this study
The online application system facilitated the program implementation. However, there were gaps and limitations noted in the data entry and verification and payout processes causing delay in the payment of wage subsidy. At the onset, no official or employee checks the initial data inputs of encoders such as the employees’ name, TIN, bank account and mobile number. Subsequently, SSS instituted procedures for validation and correction, but time constraints in the program implementation pre-empted the full validation and correction of data. The incomplete and invalid information of employees resulted in the payment of ₱1.92 billion to 132,506 beneficiaries with duplicate/invalid TIN, and unclaimed payouts for 77,167 and 17,205 beneficiaries in remittance centers and bank accounts, respectively. The absence of reliable databases of program beneficiaries for verification and matching purposes caused incorrect tagging in the processing of applications. Also, delayed release and unsuccessful payouts defeats the objective of providing immediate relief to the intended employee beneficiaries.
Further, the implementation challenges and short timeframe to implement the program; the ₱6.7 billion unsuccessful/rejected payouts and the return of ₱5.7 billion to the Bureau of the Treasury impacted on the effectiveness and efficiency of the SBWS Program.
What COA recommends
Although the SSS implemented swiftly the SBWS Program for impacted formal economy sector employees during the pandemic, a similar situation may occur in the future, and similar measures will be undertaken. Therefore, COA recommends that SSS in coordination with DOF and BIR: (1) conduct risk assessment to identify potential problems and develop appropriate strategies and mitigating measures to address them; (2) revisit and improve the identification process of target beneficiaries to ensure that all affected employees receive equal opportunity to apply to the program; (3) enhance the system used in SBWS Program to consider incorporating among other, features on preventive validation controls on data entry of applications, processing, approval and payout of wage subsidies; use of national ID system and the SSS UMID ATM cards for efficient verification and payouts; data sharing of compatible databases from different programs and mechanism readily accessible to beneficiaries on the verification of status of applications and payouts (4) formulate and implement robust information campaign for effective dissemination of program materials and announcements; and (5) enhance the process on voluntary return of wage subsidies from ineligible beneficiaries.
On the other hand, to ensure that program funds have been appropriately utilized and only eligible beneficiaries received the wage subsidies, COA recommends that SSS in coordination with DOF and BIR should identify the ineligible beneficiaries through post-implementation verification of TINs and take necessary steps for the immediate recovery of the wage subsidies provided to ineligible beneficiaries.