The government announced recently a P1.30-trillion stimulus fund that would be devoted mainly to cash doles to disaster victims and to the rehabilitation of devastated communities. The fund’s aim is to ensure the country’s speedy recovery from calamities.

Allocations for social services for the rest of 2025 would drive a “multiplier effect” on the economy, according to the Palace. The government believes that when public funds are appropriately used, more money circulates, helping stimulate the economy.

Economists, however, beg to differ, pointing out that infusing funds into cash aid is counterproductive.

They cited, for instance, the P200 billion in 2024 that went to cash doles, which was basically intended as political patronage. 

A Department of Economy, Planning and Development (DEPDev) study in 2021 showed that the beneficiaries used the government cash aid to purchase imported rice, sardines and corned beef.  

Around 18 percent was spent on products ordered through Shopee and Lazada, 99 percent of which were made in China or Vietnam. Only P60 of every P100 stayed within the local economy.

People who receive doles also work less, based on a UP School of Economics survey on 4Ps teens that showed that for every P1,000 monthly grant, there was an 8-percent lower chance a recipient would be willing to work part-time.