PIDS in the News

The global unemployment rate will increase to 5.8 percent representing 3.4 million people or a total of 201.1 million, according to the World Employment and Social Outlook-Trends 2017 report recently released by the International Labor Organization. This gloomy picture is attributed to the weak economic growth in many regions, in particular Sub-Saharan Africa, Latin America and the Caribbean, which are all still reeling from the effects of the 2008 economic meltdown that affected many countries.
However, projections for Asia Pacific are positive, with the report citing the Philippines and Indonesias significant employment growth. According to the Philippine Statistics Authority, the number of jobless Filipinos in 2016 has gone down to 2.4 million or 5.5 percent, lower than the 2.6 million or 6.3 percent jobless recorded in 2015. However, the underemployment rate continues to be in the double digits with 18.3 percent or 7.5 million Filipinos working part-time or employed in non-regular jobs.
Socioeconomic Planning Secretary Ernie Pernia had disclosed much earlier that the government is targeting a four to five percent unemployment rate by 2022, though he agreed that underemployment is of more concern because of the double digit rates. Pernia said that over 30 percent of those employed are still considered vulnerable, especially those working in the agriculture sector.
Members of the business delegation that accompanied Japanese Prime Minister Shinzo Abe during his recent two-day visit to the Philippines expressed interest in investment opportunities in the agribusiness sector " one of the five priority areas under the governments comprehensive national industrial strategy program. This is definitely a positive development especially for Mindanao " dubbed as the land of promise and the food basket of the Philippines " whose agricultural potential has not been maximized despite its rich biodiversity, conducive climate and fertile soil.
Just recently, the Japan International Cooperation Agency extended a 4.9-billion loan for the development of Mindanaos agriculture sector under a project called Harnessing Agribusiness Opportunities through Robust and Vibrant Entrepreneurship Supportive of Peaceful Transformation or Harvest which will act as a lending facility for agribusiness and related investments.
The project aims to help ordinary Mindanao farmers and concerned institutions develop and grow the agriculture sector which could generate more investments and job opportunities especially in conflict-affected areas. The Philippine Statistics Authority says agriculture, forestry and fishing account for over 60 percent of the economy in Mindanao, but conflicts have made many areas among the poorest in the country.
According to London-based industry intelligence provider ReportBuyer, projections for the agribusiness sector in the Philippines is positive in the long term given the countrys potential for expansion into new sectors such as palm oil. The outlook for sugar mills as well as the livestock sector is also expected to show healthy growth rates, the report said. ReportBuyer also noted the governments initiatives to support rice and sugar production, although backyard farming and infrastructure problems continue to hamper growth of the sector which remains uncompetitive.

Experts have long been saying that agriculture is a key factor in making economic growth inclusive and in reducing poverty incidence in the country. One of those who has been stressing the need to pursue large-scale activities in the agribusiness sector is businessman Manny Pangilinan, saying as early as five years ago that government has to focus on the sector, noting its very small contribution to the countrys gross domestic product.
First Pacific, in particular, has always been keen on investing in the agri sector most especially in the production of cash crops like banana and sugar as well as coffee, rubber and palm oil. Even Malaysia has indicated interest in agribusiness investments, specifically in palm oil.
Secretary Pernia, who is also director general of the National Economic and Development Authority or NEDA, said the government is looking at policy changes on agriculture and rural development that would allow for large-scale commercial farming in order to improve productivity and enhance profitability even for ordinary farmers. Pernia previously noted that the agriculture sector continues to lag despite the countrys consistent economic growth.
Productivity has not been maximized because of small land parcels awarded to beneficiaries of the agrarian reform program with minimal production capacity. The NEDA chief says the small parcels should be consolidated into plantation-size areas for cultivation in order to achieve economies of scale to produce enough rice and other cash crops. Consolidating the small parcels would attract more investors who have the financial muscle to buy modern machinery and employ the latest farming techniques " instead of the traditional plow and carabao method employed by small, struggling farmers " for increased productivity.
A report by the Philippines Institute of Development Studies showed that poverty, especially in the rural areas, is related to low farming productivity and poor agricultural diversification. This is the same view shared by several business organizations that believe an efficient agricultural sector with improved productivity, through increased investments and industrialization, would significantly contribute to poverty alleviation efforts and help residents in poor rural communities improve their quality of life.//

Author: Babe G. Romualdez
Date: January 17, 2017
Source: Philippine Star

THE government should carefully weigh its policy options on endo, or temporary employment contracts (TEC), because immediately ending the practice could undermine the goal of achieving rapid, inclusive and sustained economic growth, a state think tank said.
Endo, short for end-of-contract, is a practice that refers to the use of temporary employment contracts whereby a firm hires a temporary worker for a six-month probationary period, dismisses them after a few (usually five) months, then rehires them and dismisses them again after five months, colloquially known as 5-5-5.
The Philippines Institute for Development Studies (PIDS) said that last year, anti-contractualization advocates succeeded in getting political leaders, including the elected President and Vice President, to commit to a new law and the immediate issuance of regulations that would tighten, if not abolish, the use of TECs and tamp down abuses in outsourcing.
Following up on his electoral promise, President Rodrigo Duterte has given his new Department of Labor and Employment (DOLE) Secretary marching orders to end contractualization. The President emphasizes that the government, after all, is mandated by the constitution to provide job security to all workers.
There is little doubt that the endo practice is illegal. Therefore, to uphold the majesty of the law, the government is obligated to end the practice, PIDS stated in a recently released report.
However, it should not prevent citizens from questioning the wisdom of the current worker regularization law and from examining the need for its amendment, it pointed out.
More crucially, the outrage against illegal endo practices should not blind politicians and voters to the potential adverse consequences of further curtailment or prohibition of temporary employment and job outsourcing, it added.
In effect, the government needs to carefully weigh the effects of ending endo and of curtailing other TECs, it said.
Overblown response
It appears that the need for immediately ending endo is overblown and could significantly impede achievement of inclusive growth, it said.
PIDS said endo and other TECs play valuable roles in keeping the Philippine economy efficient, competitive and inclusive.
Ending endo would adversely affect inclusive economic growth, depending on the aggressiveness and nature of government response to the anti-contractualization demands, it said.
The agency said the call to outlaw TECs is partly due to lack of appreciation of its important role in labor market efficiency. For government and voters to have a more informed response to the anti-contractualization demands, it is critical to have a good understanding of the economic value of TECs, it said.
In its view, PIDS said endo is a mechanism for coping with the business costs and difficulties associated with labor regulations.
For many employers, their decision to regularize a worker or practice endo depends on their calculation of the costs and benefits from endo practices, it said.
The think tank said that like the impact of rapidly rising legal minimum wages, some proposed regulatory changes could inadvertently hurt the growth and survival of small enterprises as this could prevent them from providing job opportunities to people with poor credentials.
Such unintentional consequences could happen, should political leaders fail to recognize TECs role in the efficient functioning of labor, it stated.
Cautionary note
While we do not pretend to present definitive conclusions about the anti-contractualization proposals, we believe that a more informed view of the policy proposal is needed. This is to allow time to find more efficient and less counter-productive alternatives to the proposed curtailment of TEC use. Based on our preliminary reading of immediately available information, we present a cautionary note, it added.
PIDS said adverse impact would be intensified by imposition of more restrictions on other forms of TECS or, worse, by the passage of pending congressional bills prohibiting all forms of TECs.
In theory, there are a variety of ways for reducing the prevalence of endo practice. They range from tightening enforcement of existing labor regulations to passing legislation for plugging loopholes that employers are allegedly abusing to circumvent the regularization law, it said.
The dilemma is that, on the one hand, limiting government action to tightening enforcement might not be enough to eliminate endo practice, as promised by President Duterte, it added
On the other hand, PIDS said aggressive threats of government harassment, huge penalties, business closures as well as prohibition of all forms of TECs to close loopholes could lead to unintended adverse consequences like reduction in job opportunities and inclusive growth.
The pending bills would also undermine the countrys ability to prepare and re-position its regulatory and policy environment for the impending Fourth Industrial Revolution"the would-be new normal which will bring about massive destruction of current jobs and the creation of new ones.
Contrary to peoples mindset at present, what is needed, looking forward, is to liberalize the use of TECs and find ways of providing better-paying jobs and income security under the would-be new normal. It is in light of the above observations that the government should address the anti-contractualization issue, it concluded.//

Author: Mayvelin U. Caraballo
Date: January 17, 2017
Source: Manila Times

The governments plan to end endo, or contractualization, could lead to layoffs and greater inequality in the country, according to a study released by the Philippine Institute for Development Studies (PIDS).

In a study, titled Beware of the End Contractualization! Battle Cry, PIDS research fellows Vicente B. Paqueo and Aniceto C. Orbeta Jr. said ending contractualization would be more expensive for companies than the government estimated.

Hiring more permanent employees would increase the cost of firms by about 30 percent to 40 percent, higher than the governments estimate of around 10 percent.

The dilemma is that, on the one hand, limiting government action to tightening enforcement might not be enough to eliminate endo practice, as promised by President Duterte. On the other hand, aggressive threats of government harassment, huge penalties, business closures, as well as prohibition of all forms of TECs [temporary employment contracts] to close loopholes could lead to unintended adverse consequences like reduction in job opportunities and inclusive growth, Paqueo and Orbeta said.

The government plans to impose a 100-percent end to contractualization that will force employers to strictly comply with the regulation.

But based on the Department of Trade and Industry (DTI) proposed win-win solution to contractualization, firms will be allowed to hire workers but these same workers will not be regularized after six months based on certain conditions.

These conditions is if firms are provided with qualified manpower service agencies, and if these workers are employed as regular employees of contractors and they receive the mandated benefits.

[The] scheme would give job security to the laborers, while addressing the needs of contractors principals for employment flexibility, the research fellows said.

The main issue is the additional costs to be passed on to the principals by manpower suppliers, they added.

Findings in the research showed that Filipino workers were predominantly regular workers constituting 70 percent of all workers. Interestingly, the share of regular employees was steady at 75 percent prior to 2014.

Data also showed that, relatively, regular workers have higher wages and there was a decline in real wage rate between 2001 and 2014.

The study also noted that there is a rise in real earnings to P266 in 2014, during the term of former president Benigno S. Aquino III, from P260 in 2010.

Further, a 2014 survey showed that 95 percent of workers employed by endo contractors appear satisfied with their current jobs.

Additional information reveals that the workers covered by the Social Security System, Pag-ibig and Philippine Health Insurance Corp. are quite high at 95.7, 92.8 and 94.8 percent, respectively.

The research fellow also said a high proportion also enjoy minimum wages, overtime pay/holiday premiums and 13th-month pay.

It is, therefore, not surprising that a high proportion of interviewed workers expressed satisfaction with their current jobs despite the fact that only a small proportion of them are entitled to leave credits, separation pay, security of tenure and other benefits. There is, however, still room for improving the work conditions of endo workers when it comes to security of tenure, the authors said.

In 2014 PSA data showed over a million Filipino workers did not hold regular positions in their companies.

Based on the Statistics on Non-Regular Workers, the PSA said 1.336 million workers were considered nonregular employees in 2014.

This represented some 29.9 percent of all 4.472 million workers employed in establishments with 20 or more workers.

Nonregular workers are composed of contractual/project-based workers, probationary workers, casual employees, seasonal employees and apprentices/learners.//

Author: Cai Ordinario
Date: January 17, 2017
Source: Business Mirror

MANILA, Philippines - Budgeting practices for the procurement of healthcare equipment are contributing to the deficiencies in equipment and deterioration of services in government hospitals, state think tank Philippine Institute for Development Studies (PIDS) said in a policy note.

In the paper titled How budgeting practices on health-care equipment may fail government hospitals, PIDS said government hospitals must be prepared to respond to the increasing demand for health services now that more poor Filipinos are covered under the National Health Insurance Program.

Public hospitals are currently classified as either those managed by the Department of Health (DOH) or those run by local government units (LGUs).

Funding for DOH-run hospitals is derived from the General Appropriations Act (GAA) approved by Congress each year. This may also be augmented by suballotments from the DOH central office, hospital revenues or net income from the Philippine Health Insurance Corp. (PHIC), among other sources.

LGU-managed hospitals, meanwhile, source funds from internal revenues allotment (IRA) and the net income of LGUs. These hospitals also receive transfers from the DOH and the PHIC.

PIDS said an income retention policy is considered critical for the upkeep of hospital infrastructure and equipment.

DOH managed hospitals have been allowed since 2003 to retain their income, at least 25 percent of which should be allocated for the purchase and upgrade of hospital equipment used directly in the delivery of services. The remainder of the income retained may be used to cover maintenance and other operating expenses (MOOE) and capital outlay for other infrastructure and equipment.

No such blanket policy, however, exists for LGU-run hospitals.

While some LGUs have created special/trust funds, most still pool hospitals revenues in a general fund without any guarantee that the funds would be plowed back into the contributing hospitals, said PIDS.

The use of historic budgeting in government hospitals" in which a budget ceiling persists"also gives greater priority to covering expenses for wages of personnel and other operational expenses.

PIDS noted that based on the income retention policy, DOH-managed hospitals are given the flexibility to use a fourth of their income to fund capital investment. But because funding from the national government is insufficient to cover personnel salaries and maintenance and operating expenses, the allowed 25 percent is almost never spent on capital outlay.

Capital outlay"funds used to procure fixed assets such as property and equipment or to extend the lifespan of such acquisitions"is also not a permanent item in the budget plans for public hospitals and is funded on a as-needed basis.

No system is in place to objectively determine the authenticity and urgency of the needed capital asset. This subjects the funding for capital outplay to political whims, as in the case of most LGU-managed hospitals, said PIDS.

Public hospitals also suffer from low technical capability on budget planning for healthcare.

As such, PIDS recommends implementing a so-called capital budgeting that provides for adequate and regular allocation for acquisition of and maintenance of capital assets. This also includes the adoption of a standard maintenance cost of five percent of the original value for hospital buildings and equipment.

This would ensure that hospitals would not be utilizing equipment until these have reached operational limits.

Decisions in what capital assets to buy or upgrade ought to depend on which one will give the highest profitability. Intelligent investment decisions must also be based on numerical data from costing studies on accurate financial reports, said PIDS.

PIDS also recommends the conversion of the DOHs Health Facilities Enhancement Program (HFEP) into a long-term capital investment fund the access to which would require the submission of long-term capital investment plans with corresponding maintenance programs.

There shall be a regular reporting system that would monitor and evaluate the effectiveness of the investment including financial, clinical care, and quality of care measures, said PIDS.

The think tank is also recommending the use of public-private partnership (PPP) arrangement for hospital equipment wherein a private partner would be brought in to invest in the hospital equipment of all DOH-managed hospitals for specific time period.//

Author: Czeriza Valencia
Date: January 15, 2017
Source: Philippine Star

MANILA, Philippines - The public health sector stands to benefit from special forms of public-private partnerships (PPP) especially in expanding the provision of universal health coverage, state think tank Philippine Institute for Development Studies (PIDS) said in a new policy note.
PIDS said PPP projects that enable the government to retain ownership of physical assets and taking advantage of the expertise of the private sector can alleviate some of the burden in the public health sector.
Among PIDSs proposals include the use of public-private investment partnerships (PPIP) and public-private interactions (PPI).
PIDS describes PPIP as long-term, highly structured relationships between the public and private sectors designed to achieve significant and sustainable improvements to healthcare systems at national or subnational levels.
PPIP allows a private entity or a consortium of private partners to co-finance, design, build and operate public health facilities but ownership of such facilities remain with the government.
Here, the government is able to rely on the private sectors expertise and investments to achieve public policy goals while still able to maintain ownership of the assets throughout the duration of the partnership, PIDS said.
PPIP, carried out for at least 10 years, also provide for regular government review and third party monitoring.
PIDS said through this type of PPP, the government would be able to deliver high quality and affordable preventive and curative care at minimal to zero out-of-pocket expense to citizens because of sharing of investment and risk.
Similar to PPIP, PIP is also a long-term arrangement but only attends to smaller portions of healthcare service delivery such as infrastructure, service management, or concession-type contracts.
PPIs are seen to merely cover gaps in health service delivery, PIDS said, noting this type of PPP may only support the goal of providing universal healthcare.
Unlike PPIP, it is not sufficient to address the goal of achieving universal healthcare by itself.
These two types of PPP are especially beneficial in providing primary care, hospital care, and integrated healthcare said the think tank.

In implementing such partnerships, PIDS said these must be modified according to local knowledge and experience and must be in tune with the national health strategy.
PPPs must be contextualized to the political landscape, economic situation, private sector interest, and commitment level of stakeholders involved, PIDS said.
They must be in sync with the national health mandate and strategy so as to avoid fragmented initiatives that clutter the landscape and confuse the key players in healthcare, it added.
Other elements that may contribute to the success of PPP in public healthcare include a comprehensive health plan that clarifies the role of PPP in the health system and in attaining universal health coverage; a clear legal framework that protects the interests of both the public and private sectors; and a regulatory framework that keeps track of the progress of projects.
A long-term health plan will also guide the government on what projects should be prioritized and who should it be collaborating with.
A legal framework should also spell out the liabilities of the public and private sector partners if the objective of the PPP is not attained. It should also provide for guidelines on how to go about the partnership, ensuring that there is enough incentive for private investors.
Under a regulatory framework, the public sector should also be able to police partners, and assist in the technical aspects of the partnership, among others.
Both public and private sectors must be ready and willing to enter into the partnership. This means that the public sector should have the capacity to handle the technical requirements of the project, including regulation and enforcement, while the private sector should meet the quality standards so as to achieve better health outcomes, PIDS said.//

Author: Czeriza Valencia
Date: January 14, 2017
Source: Philippine Star

A comprehensive health plan must be created to clarify the role of public-private partnerships (PPPs) in the health system and in attaining universal health coverage (UHC) in the country, a study released by the Philippine Institute for Development Studies said.

According to the policy note, PPP options for universal health coverage in the Philippines, a long-term plan will guide the government on what projects to prioritize and who it should collaborate with.

In many countries, the public sector is unable to meet certain social needs such as UHC due to its lack of resources, administrative roadblocks and management issues. Thus, UHC " a scenario where a wide spectrum of people obtains the needed health services without having to suffer financial hardships " becomes a challenging development goal, the report said.

The government has turned to PPP as among its strategies to move toward UHC.

Currently, included in the pipeline of PPP projects to be implemented by the Department of Health is the rehabilitation of the National Center for Mental Health.

Ultimately, PPPs are intended to improve a countrys health outcomes. The success of a PPP is not only measured at the projects culmination; rather, it is also determined by the preparations leading up to it, the report said.

It added that aside from having a comprehensive health plan, a legal framework is likewise necessary to protect the interests of both public and private sectors and to make them liable when the objective of the PPP is not attained.

Policies should serve as guidelines on how to go about the partnership, ensuring that there is enough incentive for private investors, the study said.

The report also noted the need for a regulatory framework, specifically a controlling body, to keep track of projects, police partners and assist in the technical aspects of the partnership, among others.

An independent body is also needed for an unbiased and consistent monitoring and evaluation of projects, the study said.

Lastly, the policy note said both public and private sectors must be ready and willing to enter into the partnership.

This means that the public sector should have the capacity to handle the technical requirements of the project, including regulation and enforcement, while the private sector should meet the quality standards so as to achieve better health outcomes, the report stated.//

Date: January 13, 2017
Source: Malaya

The abolition or the scaling down of the Pantawid Pamilyang Pilipino Program (4Ps), pushed by the militant left and their allies in Congress would have damaging unintended consequences on the present and future welfare of poor children, a report released by the Philippine Institute for Development Studies said.

According to the discussion paper titled, Pantawid Pamilya Pilipino Program: Boon or Bane, such policy decision would arguably reduce beneficiary childrens opportunities for gainful jobs as well as their chances of moving out of poverty when they become adults.

Opponents of Pantawid have been disingenuous in denying the value of preparing children for productive employment. Their use of the adage about teaching people how to fish instead of providing dole outs is misleading to advocate reallocation of Pantawid budget to some unspecified job creation program, the report said.

The study said the critics concern that Pantawid cash grants would just increase expenditures on vices, undermine work ethics and encourage a culture of mendicancy is overblown.

In fact, impact evaluation does not support the critics allegations, at least within the parameters of the current design of Pantawid Pamilya and other CCT (conditional cash transfer) programs outside the Philippines. In this regard, evidence indicates that poor parents spend their resources responsibly, the paper said.

Mere labeling and denigrating the programs conditional grants as dole-outs that parents would just waste on vices instead of childrens human capital formation is not a credible argument to support the critics call for the abolition of Pantawid Pamilya, it added.

Second, the study said critics claim that Pantawid is a failure because its benefits are going to beneficiaries above the poverty line is a gross exaggeration.

In fact, 82 percent of the beneficiaries belong to bottom 40 income class and 53 percent are from the bottom 20 income class. It was also pointed out that Pantawid is one of the better targeted CCT programs in the world, it said.

The report said Pantawid not only had spillover effects of improved education, health and nutrition but that evidence indicates the grants do lead to less insurgent influence and fewer violent conflicts.

The benefits from reduced conflicts, greater social cohesion and improved social order can be viewed as public goods. These benefits provide yet another justification for investing public funds in Pantawid Pamilya, the paper said.

However, the study said there are important issues that need to be addressed to maintain and enhance the impact of Pantawid on the welfare of the poor.

On the size of grants, the paper said there are proposals to raise their amounts to enhance the impact of Pantawid Pamilya.

There is reason to believe that increased amounts would raise the impact of the program. But providing all beneficiary households bigger grants without piloting it would be risky, the study said.//

Author: Angela Celis
Date: January 16, 2017
Source: Malaya

HEALTH CARE in the countrys public hospitals is compromised by the maintenance of their assets, according to a policy note by the Philippine Institute for Development Studies (PIDS) released last Friday, Jan. 13.

The policy note, titled How budgeting practices on health-care equipment may fail government hospitals, said in part that, Based on the actual hospital expenditures on repair and maintenance and results from the FGD (focus group discussions), it can be construed that the selected hospitals do not have maintenance programs specific to their assets, especially the heavy equipment.

It was found that reported repairs and maintenance expenditure only took up 0.17-2.58% of the budget for maintenance and other operating expenses of public hospitals.
Generally, hospitals have a very low budget utilization or actual expenditure for repairs and maintenance, with some reporting not to have spent anything at all for their maintenance, said PIDS, adding:

All the selected hospitals reported that they have continued to use even the fully depreciated capital assets. Although hospitals are well aware of the protocol for handling fully dilapidated assets as stipulated by CoA (Commission on Audit), the scarcity of resources compels them to continue utilizing these equipment until the latter have reached their operational limit and/or a replacement arrives.
This practice has led to additional maintenance costs in terms of servicing the damage beyond their useful years and the replacement of their spare parts, the institute said, as it noted further: Spare parts of outdated models turn out to be more expensive particularly when they are not easily available.

In the end, health care is compromised by the obsolescence of the fully depreciated equipment, PIDS said.

All these confirm that depreciation costs are not being utilized as inputs to guide hospitals in capital management, the agency also pointed out.
The government should consider long-term capital investment fund, public-private partnership (PPP) arrangements for hospital equipment, output-based payment and improved data management and utilization for better budgeting system of public hospital facilities.
PIDS recommended the conversion of the medium-term Health Facilities Enhancement Program (HFEP), which sought to utilize the states budget for capital outlay (CO) in health, into a long-term capital investment fund, which will require public hospitals to submit long-term investment plans and maintenance programs.

There shall be a regular reporting system that would monitor and evaluate the effectiveness of the CO investment including financial, clinical care and quality of care measures, said PIDS.
The government should also consider allowing the private sector to invest in hospital equipment in a PPP scheme as well as provide incentives by shifting towards an output-based payment system for better quality health-care services.
PIDS also suggested the formulation of proper guidelines and protocols for budgeting and maintenance of equipment, as well as the implementation of the New Government Accounting System straight-line depreciation method, in calculating the depreciation costs.
PIDS further saw the need for the government to digitize financial processes and workflow by investing in information technology for more efficiency in budgeting and financial management in public hospitals.//

Author: Danica M. Uy
Date: January 16, 2017
Source: Business World

A study conducted by the Philippine Institute of Deve-lopment Studies (Pids) raised warning bells over higher- than-necessary conditional cash transfer (CCT) grants as this could lead to a culture of dependency among recipients.

The study, titled Pantawid Pamilya Pilipino Program: Boon or Bane?, was authored by Pids research fellows Aniceto Orbeta and Vicente Paqueo.

The authors recommended that the government first pilot a study of various cash grants before deciding on granting higher CCT amounts.

Much bigger grants, however, can change the household calculus in ways that would lead to the weakening of work
ethics and the emergence of dependency on government, as critics have warned, the study read.

The authors said that, while arguments supporting increased cash grant amounts for beneficiaries could enhance the impact of the CCT Program, increasing the amount without studying the impact of various levels of cash grants would be risky.

They said it would be more prudent for the government to see the impact of alternative grant amounts could be an incentive to become dependent on the government.

Providing all beneficiary households bigger grants without piloting it would be risky, the authors said. Relatively large grants could trigger unintended consequences on work ethics. Apart from the studying possible amounts for the CCTs, the authors said there is a need to rethink the conditions for the cash grants.

Orbeta and Paqueo said that, given the elementary enrollment rate is now at 100 percent and all CCT beneficiaries are now covered by Philippine Health Insurance Corp., other education and health-related conditions must be put in place.

The study found enrollment for elementary pupils remained high in the first two waves of the CCT implementation and enrollment among children aged 12 to 17 years saw an increase after Wave 2, when high-school children were included in the CCTs.

While the CCT has not eradicated child labor owing to the grants being insufficient to remove the practice, it has significantly contributed to its decrease.

In terms of health, the study found more children undergoing growth monitoring and receiving deworming pills, vitamin A and iron supplementation. Further, more mothers received ante-natal and postnatal care from health-care professionals.

Overall, the evaluations have shown that the poor, like anybody else, are rational on the use of their money. They respond to incentives, such as giving importance to socially desirable expenditures, like education and health, the authors said.

The CCT Program started with 284,000 beneficiary households in 2008. By 2015, beneficiaries reached 4.1 million households. In terms of population, the number of beneficiaries rose from 662,000 children aged 0-18 years old in 2008 to 10.2 million in 2015.

Today the program covers about 79 percent of poor households whose income is less than the amount needed to basic necessities.

The CCT extends a health grant amounting to P500 monthly year round and an education grant of P300 per child for 10 months each year to each participating household.

To receive these cash grants, pregnant women must avail themselves of pre- and postnatal care, and be attended during childbirth by a trained professional and parents or guardians must attend the family development sessions, which include topics on responsible parenting, health and nutrition.

Other conditions include children aged 0 to 5 must receive regular preventive health check-ups and vaccines; those aged 6 to 14 must receive deworming pills twice a year; and children between 3 and 18 must enroll in school, and maintain an attendance of at least 85 percent of class days every month.//

Author: Cai Ordinario
Date: January 15, 2017
Source: Business Mirror

The Conditional Cash Transfer Program (Pantawid Pamilyang Pilipino Program or 4Ps) is a smart populist program and its abolition or scaling down could damage the gains achieved especially on the welfare of poor children, according to state think tank Philippine Institute for Development Studies (PIDS).
But this does not mean there is no room for improvement, it pointed out.
In a discussion paper, PIDS said despite criticisms that the program promotes the culture of mendicancy and dependence, the 4Ps has become a highly popular and well-regarded program with international partners like the World Bank and Asian Development Bank, which consider the Pantawid as one of the best conditional cash transfer programs in the world.
The administration of then-President Gloria Macapagal-Arroyo developed 4Ps and tried it as a pilot project in a few locations in 2008.
Recognizing its potential, then-President Benigno Aquino 3rd started a massive expansion of the program in 2010, along with a series of measures strengthening its governance and management.
The objective of the program is to immediately ease poor families pain of deprivation and simultaneously enable and motivate them to raise the education, health and nutrition status of their children.
With increased human capital, these children would supposedly have a better chance of escaping poverty in the long run.
With this objective in mind, the government designed Pantawid Pamilya to assist the poor by providing them conditional cash transfers (CCTs). Unlike conventional social assistance, those grants are provided in exchange for certain actions [called conditionalities]that beneficiaries must comply with, PIDS said.
Starting with 284,000 in 2008, beneficiary households reached 4.1 million by 2015.
In terms of population, the number of beneficiaries rose from 662,000 children 0-18 years old in 2008 to 10.2 million in 2015.
Today, the program covers 79 percent of poor households whose income is less than the amount needed for basic necessities, PIDS noted.
PIDS said its impact evaluations showed that the Pantawid has kept children in school; decreased the time spent on paid work for children although it has not significantly decreased the incidence of child labor; improved access to essential health services even though its higher-level impact is mixed perhaps because of supply side issues; increased household expenditure on education as well as expenditure on clothing; shown that adult members of the Pantawid households are as industrious as their non-Pantawid counterparts as indicated by all aspects of the labor market outcomes from labor force participation, employment, hours of work and looking for work when unemployed; and decreased conflict incidents.
Overall, the evaluations have shown that the poor, like anybody else, are rational on the use of their money. They respond to incentives such as giving importance to socially desirable expenditures like education and health promoted by Pantawid which are known to be of little current importance to them because the prospective benefits are too far in the future, it added.
Indeed, Pantawid Pamilya is a smart populist program unlike other anti-poverty programs. It helps the poor with their urgent needs, while creating a more hopeful future for their children, PIDS said.
This alternative future, according to the think tank, is being created by helping the children of the poor develop greater capacity to eventually earn income through increased years of education.
In addition, the program paves the way for the poor childrens development in terms of mental capacity and other physical abilities, qualities associated with good health and nutrition, PIDS said.
This implies that the program supports interventions that would likely reduce the transmission of poverty from parents to children, the think tank added.
Therefore, the abolition or the scaling down of Pantawid would probably have damaging unintended consequences on the present and future welfare of poor children, it said.
PIDS added that such policy decision would arguably reduce beneficiary childrens opportunities for gainful jobs as well as their chances of moving out of poverty, when they become adults.
Improvement needed
Nevertheless, despite advances in social assistance, the 2015 Family Income and Expenditure Survey (FIES) showed that there remains a considerable gap between the average household income of the poor and the poverty threshold.
The gap is estimated to be 135.6 billion pesos in 2015. This is the amount of transfer needed annually to bring the income of all poor households to the level of the poverty threshold, it added.
Despite large increases in Pantawid budget, therefore, the financial challenge of helping the poor close the gap between their income and the poverty line remains substantial, PIDS said.
Moving forward, there are important issues that need to be addressed to maintain and enhance the impact of Pantawid on the welfare of the poor, it added.
Therefore, PIDS said the three important issues needed to be addressed were: the mixed findings regarding the impact of the program on outcome indicators; the desirability of raising the amount of grants provided; and the need to adjust the program conditionalities.//

Author: Cai Ordinario
Date: January 15, 2017
Source: Business Mirror

The government should create an agency focused on reforestation alone to build on the success of the National Greening Program (NGP), according to a study released by the Philippine Institute for Development Studies (Pids).
In a Policy Note, titled Taking Stock of the National Greening Program Six Years Hence, Pids research fellow Danilo C. Israel said if this is not possible, the Forest Management Bureau (FMB) of the Department of Environment and Natural Resources (DENR) must be ultimately responsible for all reforestation initiatives.
The national government should place the ultimate responsibility for all reforestation initiatives on the FMB. Thus, its conversion to a bureau should be seriously studied, Israel said.
Alternatively, the creation of a new agency tasked only with reforestation, possibly answering directly to the president, should be considered, he added.
Israel said this is one of the ways to boost the DENRs reforestation and rehabilitation efforts.
Currently, the DENR hires NGP coordinators and extension officers as contractual workers to manage and run the project, which is a double-edged sword.
Israel said that, while their lack of security of tenure can compel them to work and meet the project targets, they are not invested in the missions and mandates of the DENR.
He said this has an impact on project management and funding, as well as monitoring corruption in NGP activities.
The national government should strengthen the capacity of DENR personnel and POs [peoples organizations] to monitor corruption in NGP activities. For one, the implementation of an effective reward system for those who report illegal practices should be considered, Israel said.
The program, he said, must invest in organization development and the capacity-building of the POs to reduce conflicts that could undermine the gains of the NGP.
It must also put in place incentives for communities to protect and sustain the plantations in the long run, Israel said.
These could be in the form of harvesting rights, livelihood support, mechanisms for long-term financing, such as payments for ecosystem services schemes and addressing tenure issues.
The government must also review the design of the NGP in terms of individual species and mix of tree species planted, tree spacing and other important technical parameters.
The DENR should identify and include highly vulnerable areas in the site mapping and planning and then match species and spacing with the sites, Israel added.
In terms of hectares covered and seedling planted, the NGP was able to meet 113 percent and 90 percent of its targets, respectively, between 2011 and 2016.
Under the NGP, 1.34 million of the 1.5 million seedlings of various tree species were planted in 1.64 million hectares of the 1.45-million hectares target open, denuded and degraded forestlands.
The program allowed the Philippines to rank fifth among the countries worldwide with the most annual forest gain between 2010 and 2015.
Data from the Food and Agriculture Organization showed the countrys annual forest gain was 240,000 hectares, representing a 3.5-percent yearly increase in forest area.
Apart from forest area gained, the NGP was able to create 3.3 million jobs and employed 462,066 in upland and rural communities as of November 2016.//

Author: Cai Ordinario
Date: January 15, 2017
Source: Business Mirror

THE National Greening Program (NGP) generated about 3.3 million jobs in the first six years of its implementation, but continued to miss its target survival rate for planted seedlings, the Philippine Institute for Development Studies (PIDS) said.
As of Nov. 30, 2016, the program has generated approximately 3.3 million jobs and employed 462,066 persons in upland and rural communities, PIDS said in a policy note.

In Taking stock of the National Greening Program six years hence, PIDS said employment generated by the NGP increased from 2011-2014, slowing down slightly in 2015 and stagnated last year.

The data revealed that the employment performance of the NGP may have significantly decreased in 2016 relative to its performance in the past years, said PIDS.

Meanwhile, the program continued to miss its target survival rates for seedlings planted in 2011-2015.

According to the PIDS, the survival rate of seedlings was only 83% in 2011-2014 and only 82% in 2015.

While the program targets an annual survival rate of 85%, the actual figures have remained below it. From 2011 to 2015, for instance, the annual survival rate nationally has been 83% except in 2015 when the program registered a survival rate of 82%, the think tank said.

However, according to PIDS, the NGP will result in favorable and increasing output effects in the economy over the years.

Output is expected to increase 0.3% in 2020, 1% in 2030 and 2.5% in 2050 with forestry expected to reach as high as 5.5% of the total NGP output in 2050.

NGP also has the potential to increase household income and decrease poverty.

The income effects are progressive, with the lowest decile having real household income improvement of 1.4% in 2030 and 3.3% in 2050, while the highest decile having positive real income effects of 1.2% in 2030 and 3.0% in 2050, said PIDS, adding that poverty incidence will decrease 2.7% in 2030 and 6.34% in 2050.

While PIDS observed positive effects of the NGP on the environment, the design and tree species planted by the NGP are not always appropriate to the sites.

These fast-growing (soft-wood) species may have been intended to help the peoples organizations earn money in the shortest possible time and address their income and poverty concerns. However, on the environmental side, these species may be of less help as they are shallow rooted and vulnerable to landslides, said PIDS.

PIDS therefore proposes that the national government review the design of the program in terms of species planted, tree spacing and other technical matters.

The Department of Environment and Natural Resources (DENR) must also identify vulnerable areas in its mapping and planning stage in order to match species with sites.

PIDS also recommends that the government revisit its computation of the survival rate and other technical aspects in monitoring the program.

Additional incentives such as harvesting rights, livelihood support, long-term financing and correction of tenure issues must be provided to communities to sustain plantations in the long-term.

PIDS also suggests additional funds for organizational development and capacity building of the peoples organizations as well as strengthen the DENR to effectively carry out reforestation and rehabilitation.

The national government should place the ultimate responsibility for all reforestation initiatives on the FMB (Forest Management Bureau)... Alternatively, the creation of a new agency tasked only with reforestation, possibly answering directly to the president, should be considered, said PIDS. --

Author: Danica M. Uy
Date: January 13, 2017
Source: Business World