THE GOVERNMENT HAS SET ASIDE A P2-BILLION SUBSIDY as a way to help the poor pay their power bills.

Social Welfare Secretary Esperanza Cabral said Saturday she would present her proposed cash transfer program for small electricity users at the first meeting of the Presidential Task Force on Energy in Malacañang on Monday.

Cabral has been assigned by President Macapagal-Arroyo to draft a cash transfer program for small electricity users using P2 billion, which is part of the P4 billion earlier earmarked by Ms Arroyo for allocation to help people cope with soaring energy costs.

The P4 billion is the money so far collected by the government from the value-added tax (VAT) on electricity. Officials expect the amount to reach P18 billion this year.

“This [subsidy] is help for the poor because power costs have gone up,” Cabral said in a phone interview.

She said the “target” of the cash transfer was the 1.9 million small users of electricity, or those called lifeline users consuming less than 100 kilowatt hours a month in areas covered by Manila Electric Co. (Meralco).

These lifeline users are being served by Meralco in Metro Manila and the provinces of Cavite, Pampanga, Bulacan, Rizal and Quezon.

Cabral said that if she were to calculate the allocation of the P2-billion cash transfer, 1.9 million lifeline users would be entitled to P1,000 a year, or P100 a month.

The subsidy will help, for example, a user of 50 kWh of electricity a month whose bill is P212, she said.

Going by this estimate, Cabral said, the subsidy could be given to small electricity users for a period of from 10 months to one year.

“These are all tentative options that I will present to the task force,” she said.

Cabral said she had yet to decide whether this cash transfer program would cover lifeline users in Metro Manila only, or those in the entire Meralco franchise area (National Capital Region, Region 3 and Region 4A).

She said she also had yet to decide on the mode of the cash transfer -- “whether this would be in one lump sum, or every quarter or every semester.”

She added that she was likewise still studying the requirements to be imposed on the beneficiaries of the cash transfer. One option is for small electricity users to present their last monthly bill to authorities she said.

Unlike the other cash transfer programs of the Department of Social Welfare and Development, this love cannot be a conditional one because of, among others things, the small amount involved, Cabral said.

“It’s really just a subsidy to help them get by,” she said.

Malacañang had earlier announced a government plan to use the VAT on oil for the people’s benefit.

Lawmakers are seeking the scrapping of the VAT on oil. But Palace officials have opposed this, saying at one point that it would be “a cure worse than the disease.”

After last week’s Cabinet meeting in La Union, Press Secretary Ignacio Bunye said Malacañang’s plan was “to give back to the people” the proceeds of the VAT on oil.

Bunye said that the Palace had earmarked P4 billion for the people -- P2 billion to go to the conditional cash transfer program of the DSWD, P1 billion in assistance to the transport sector (particularly for the conversion of vehicles to gas-fueled vehicles), and another P1 billion for loans and assistance to schools.

During the meeting, Ms Arroyo ordered the reactivation of the Presidential Task Force on Energy and gave it two weeks to come up with a contingency plan on how the country could cope with the rising costs of power and oil.

Cabral’s report will apparently be part of the task force’s contingency plans.