PROVIDING SAFETY nets to the poor has been a policy embraced by the
national government to improve the living standards of the poorest
Filipinos.
The government's conditional cash transfer (CCT) program borrows from
microeconomics, welfare economics, and behavioral economics — through a
subsidy or financial aid given to extremely poor families in the
country, it aims to alleviate poverty and improve the economy.
"Government subsidy is important in alleviating poverty because it
bridges the gap between the needs of the poor and the capability of the
poor to acquire them," Cid L. Terosa, University of Asia and the Pacific
senior economist, said in an e-mail.
Based on the latest poverty data from the National Statistical
Coordination Board, poverty incidence in the country slid to 20.9% in
2009 from 21.1% in 2006. Two families per 1,000 were lifted out of
poverty between those periods.
Data showed that a Filipino family of five should have at least P4,869
in monthly income to meet their basic food needs and P7,017 to stay out
of poverty. By estimates, about 45% of Filipinos are vulnerable to
poverty if confronted by shocks such as health problems and deaths, loss
of employment, natural disasters and increasing food prices.
The CCT program involves providing money to extremely poor households to
keep kids in school and to make sure children and mothers have healthcare.
"Conditional cash transfer is a social safety net that can help the poor
jumpstart their way to self-sufficiency and economic independence," Mr.
Terosa said. However, this program should not be a long-term aid for the
poor, he said.
"As I mentioned, CCT is supposed to provide the momentum that the poor
need to become economically self-sufficient," he added.
According to a Policy Brief produced by the Senate Economic Planning
Office of the Senate of the Philippines, cash assistance is seen as more
efficient than in-kind assistance since it gives beneficiary families
the flexibility to allocate resources according to their needs and
circumstances.
"Cross country studies on CCTs showed that they have impacted the
beneficiary households' aggregate consumption not only in terms of level
but also its composition, with beneficiaries spending a greater share of
total consumption expenditure on food," the paper said.
This project is spearheaded by the Department of Social Welfare and
Development. A P500 subsidy per month is given to beneficiaries for
health and nutrition expenses and P300 a month per child (not exceeding
three children per household) for educational expenses.
University of the Philippines economist Solita C. Monsod said "the CCT
would bring economic benefits in the long run but not now."
"Right now, what the families are receiving is not enough to support
their needs and to take them out of poverty," Ms. Monsod said.
However, this cash transfer program of the government is not a one-way
street. Recipients must meet the following conditions set by the government:
1. Pregnant women must get prenatal care starting from the first
trimester, must have childbirth attended by skilled/trained
professional, and get postnatal care thereafter;
2. Parents/guardians must attend family planning sessions/mother's
class, parent-effectiveness service and others;
3. Children 0-5 years of age must get regular preventive health
check-ups and vaccines;
4. Children 3-5 years of age must attend a day care program/pre-school;
5. Children 6-14 years of age must be enrolled in schools and attend at
least 85% of the time; and
6. Children 6-14 years of age must receive deworming pills twice a year.
Traditionally, government subsidies are not tied to conditions as
mentioned above as they convey the message that beneficiary households
cannot be trusted to spend cash transfers.
"The idea is to transfer cash to the poor 'on condition' that the poor
will commit to empower themselves and help bring future generations of
poor families out of poverty. That conditionality makes this new
generation of social programs an instrument for longer-term human
capital investments as well as short-term social assistance," the Senate
publication read.
The proposed CCT budget for next year is more than 70% higher than the
current P23 billion. The CCT fund has the largest share in the
Department of Social Welfare Development's budget of P49 billion. —
Daniel Anne Nepomuceno-Rodriguez
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