What’s the math behind ‘social cost’? DOF fails to back Diokno’s call for POGO ban

The Department of Finance’s (DOF) call to shut Philippine offshore gaming operators (POGOs) down appears to be based on nothing more than grim words instead of quantitative data.

The DOF was placed in the hot seat Monday (October 3) during a Senate Ways and Means Committee hearing on POGOs. Representing Finance Secretary Benjamin Diokno was DOF Assistant Secretary Valery Brion.

Reading the DOF’s position paper, Brion said: “POGO’s modest contribution to the economy does not outweigh the social costs of its continued operations, especially that there is an alarming increase in undesirable criminal activities in the POGO sector.”

She noted that POGOs only contribute a measly P4.2 billion or 0.03% of national output as of August 2022.

“These come at significant social costs to the economy,” the DOF official added.

Senator Francis Escudero, however, challened Brion to show empirical data to flesh out what the “social cost” of having POGOs mean.

“How did you arrive at that?,” Escudero said to debunk the DOF’s position. “Ano ba dapat yung income para masabi niyo na it outweighs the social costs and we should keep it? Otherwise, it’s arbitrary.”

“Hindi naman pwedeng ‘it outweighs’ lang… at what point do you say it does and it does not? What data is it based on?,” the senator added.

“If the only figure you have is revenue collection and contribution to GDP, kindly submit to us a figure that will make it worth it from your point of view.”