The possible repatriation of Overseas Filipino Workers (OFWs) displaced by plummeting oil prices was not factored in the preparation of the 2016 national budget, “leaving a huge funding hole” on how to shoehorn their re-entry into the Philippine job market.

“This is one macroeconomic assumption which the current budget missed,” Senate President Pro-Tempore Ralph Recto said.

“In fact, the budget, which will be financed in part by taxes on imported oil, was based on an oil price forecast of $55 to $75 a barrel for 2016,” Recto said.

Oil prices have sunk to below $30 a barrel, the lowest level in 12 years.

Despite the lack of specific funding for “returning cheap oil refugees” in the P3 trillion spending package, “there are, however, contingent sources of funds for safety nets and retraining,” Recto said.

“There’s the P2.5 billion Contingent Fund under the President’s discretion,” Recto said.

Tapping this emergency fund, he explained, “is guided by the provision that it can be used for an urgent activity that needs to be implemented this year.”

Recto said another possible source is the P67.5 billion Unprogrammed Fund (UF), which can be only drawn if specific or general revenue collection for the year exceeds target.

“What is funny is that while the language of this fund reserves P30 billion of it for contingent liabilities of Public Private Partnership (PPP) projects, not a single centavo is earmarked for displaced OFWs,” he said.

The UF also sets aside P10 billion for AFP modernization but government missed allocating something for projects that “will arm returning OFWs with skills,” Recto said.

Recto said the budget of the Department of Labor and Employment (DOLE) and the Technical Education and Skills Development Authority (TESDA) for the retraining of OFWs will have to be augmented “given this unforeseen event.”

TESDA, the state technical-vocational training arm, has a gross budget of P5.4 billion this year.

DOLE, on the other hand, has a “measly P50 million for OFW repatriation”, while its grassroots livelihood projects for OFWs and their families under the Bottom Up Budgeting scheme, has a budget of P444 million this year.

“OWWA can help, but if you look at its finances, it won’t be enough to provide for the transition program of OFWs in the hundreds of thousands,” Recto said.

“I think what the government should do is to create an OFW assistance fund, to be sourced from both the regular budget and off-budget sources, including from the financial sector of the government corporate sector,” Recto said.

This, as Recto urged the government’s financial managers to assess this early the impact of the simultaneous dip in oil prices and OFW remittances to government spending.

“The budget is sensitive to these two dashboard indicators. These two will definitely move the needle negatively,” he said.

For example, a one-percentage point growth in the economy, which relies on OFW remittances as a growth driver, will up revenues by P21.6 billion.

Recto said OFWs in Saudi Arabia sent home $2.4 billion from January to November last year, or 10.5 percent of the $22.8 billion recorded cash remittances during the 11-month period.

Filipinos in UAE sent $1.58 billion in cash remittances, or 6.9 percent of total, during the same period.

While remittances originating from Saudi Arabia and UAE grew from the $1.72 billion and the $910 million recorded in 2012 respectively, the amount of money sent by Filipinos in Canada, a major oil producer, went down during the said period.

From $1.97 billion in 2012, cash remittances from Canada amounted to $861 million in the first 11 months of 2015.

There are 1.5 million temporary Filipino workers in the Middle East oil belt.

Government officials here believe that they would be the first to be laid off when the region’s oil industry sheds personnel due to plummeting oil receipts and production overcapacity.