Filtered By: Money

Pernia says a family of 5 needs P42,000 a month to live decently

A typical Filipino family needs a monthly income of P42,000 to live decently, Socioeconomic Planning Secretary and National Economic and Development Authority (NEDA) Director General Ernesto Pernia said on Thursday.

Pernia issued the statement after one of his undersecretaries drew flak from labor groups and lawmakers for using P10,000 to illustrate the cost of living of a typical Filipino family of five.

The NEDA chief noted the amount was a hypothetical figure, an example, in computing the impact of inflation—which in May clocked in at 4.6 percent—on the consumption of a family of five.

“I think roughly P42,000 a month would be a more decent income, at least to live above the poverty line,” Pernia told GMA News Online.

If at least two family members are working and earning P21,000 each a month—the personal income exempted from paying taxes under the Tax Reform for Acceleration and Inclusion (TRAIN) law—P42,000 monthly income is achieved.

“Kasi kung isa lang na kumikita ng P21,000 hindi sapat ‘yun,” he said.

“If there are two or more family members working, the family income could reach about P42,000 which could be tax exempt and may be sufficient for the family,” the Cabinet official noted.

The NEDA chief, however, said he is not endorsing a minimum wage of P42,000.

“Note that a legislated minimum wage increase not well studied could only result in even higher inflation (wage-price spiral) layoffs, business closures,” he said.

Pernia reiterated that the P10,000-monthly budget was used to illustrate the effect of inflation and tax reform on spending of a family with such a budget.

“If the monthly budget spending is P10,000, the total effect of 4.6 percent inflation rate in May would be an increase in spending of P459 on different consumer goods, of which P52 is directly attributable to TRAIN,” he said. —VDS, GMA News