State subsidy to the poor via the conditional cash transfer (CCT) program will further go up so that practically all of them are covered in two years’ time, Budget Secretary Florencio Abad said on Monday.
“Yes, the budget for the CCT will continue to increase until hopefully all the 4.6 million families benefit from the program by 2015. This is what President [Aquino] wants,” Abad told the Inquirer.
This means that the CCT would cover some 28 million people a year before President Aquino steps down, as the poor have an average family size of six. By then, the Philippine population will have reached 102.9 million.
For this year, the administration has set aside P44 billion from the national budget for the CCT program. The amount covers 3.9 million poor families identified by the Department of Social Welfare and Development.
Under the program, households receive monthly cash subsidies for five years in exchange for their commitment to send children to public schools, and to have mothers and her kids regularly visit health centers.
The maximum monthly subsidy per family is P1,200—P300 per child for up to three children and another P300 for the mother.
An immediate objective of the program is to increase the school participation rate among children of poor households. The long-term objective is to increase employment opportunities for them so they can eventually lift their families out of poverty.
Multilateral institutions, led by the World Bank and the Asian Development Bank, support the CCT. Citing experiences in some developing countries, such as those in Latin America, multilateral institutions said the CCT was effective in significantly reducing poverty incidence.
High poverty incidence
Despite its robust economic growth, the Philippines continues to suffer from one of the highest poverty rates among emerging Asian economies.
Poverty incidence in the country stood at 27.9 percent in the first semester of 2012, practically unchanged from the 28.6 percent in the first half of 2009 and 28.8 percent in the first half of 2006, according to the National Statistical Coordination Board (NSCB).
The NSCB placed the poverty line at P7,821 a month, or P257 a day for a family of five.
Economists said economic growth had so far benefited mostly the rich and the middle class. Nonetheless, many of them agreed that programs such as the CCT would help make the benefits of a growing economy trickle down to the poor.
Extension of 5-year limit
Abad said the first batch of CCT beneficiaries (some 800,000 families) was expected to graduate from the program next year as it shall have completed the five-year limit.
However, Abad said economic officials were considering a suggestion from multilateral agencies to extend the CCT program to a certain number of years to ensure that the children of household beneficiaries finish high school. High school now takes six years to finish, up from four, under the government’s new K to 12 program.
“The proposal is to extend the [CCT] program in a way that helps ensure the children graduate from high school so they can get better employment opportunities,” the budget secretary said.
He said concerned government officials were studying the proposal.
In an article in the Inquirer last month, NSCB Secretary General Jose Ramon G. Albert said the CCT was not expected to immediately yield significant changes in incomes that would make the poor cross over the poverty line.
He said the CCT “is investments in human capital, particularly in education and health, where the impact may be seen in five to 10 years.”
Originally posted: 5:29 pm | Monday, June 24th, 2013