Gov’t expects big drop in poverty in 2014

P399-B infra budget to create jobs, boost incomes



The Aquino administration expects the P399 billion earmarked for infrastructure development next year to result in a more significant drop in the country’s poverty incidence.

Economic Planning Secretary Arsenio Balisacan said that with the proposed infrastructure budget for 2014, which is 35 percent higher than the P295 billion set aside for this year, the government could substantially boost employment and, in the process, increase household incomes.

Balisacan said the investments to be generated by better infrastructure such as new roads, bridges, airports, farm and power facilities would also help promote inclusive growth.

“The dramatic surge in infrastructure spending next year will lower the cost of transporting goods and people, support agricultural productivity, reduce risks from disasters, and generate economic investments and employment. The proposed projects will ultimately benefit the poor and vulnerable sectors,” Balisacan said.

The big jump in infrastructure budget intended for 2014 comes amid criticisms that the Philippines, despite having posted robust economic growth recently, has failed to lift a significant portion of its population out of poverty.

The poverty rate in the country stood at 27.6 percent in the first semester of 2012, one of the highest in Asia. This was slightly better than the 28.6 percent in 2009 and 28.8 percent in 2006.

The minimal change in poverty incidence was despite the favorable performance of the Philippine economy, which was one of the few countries that evaded contraction in 2009 when the global economy plunged into recession.

The Philippines also recently was described as a bright spot amid a relatively lackluster global economy after the country grew by a higher-than-target 6.8 percent last year and 7.8 percent in the first quarter this year to become Asia’s fastest-growing economy.

Balisacan has expressed confidence that allocation of enormous budget for infrastructure would help fast-track the reduction of poverty incidence.

The amount allocated for infrastructure in the proposed 2014 national budget is equivalent to 3 percent of the projected gross domestic product for the year.

Balisacan said the Aquino administration intended to continue substantially increasing the annual budget for infrastructure until this hit P820 billion, or 5 percent of GDP, by 2016. Such an amount is expected to account for a quarter of the national budget.

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  • Pedro_Gil

    another BS by Pengkoy.

  • Ako_Hiking

    More talk from the government probably spear-headed by those in Malacanang. Poverty has gotten worse as the Aquino Administration moves along. And infra improvement has been non-existent or at least not significant enough to notice. Then now they’ll make predictions?? Stop the empty words and just do it and make poverty go down before talking and talking.

  • Ulipur

    How big is big, Balisacan? A drop of 2 points, 4 points, 5points?
    Will that infrastructure spending increase the growth rate and by how many points?

  • TruthHurts

    Budgets based on former budgets with slightly higher incremental increases WILL NOT make any significant changes. The government has to identify how many people are in need of what it offers, multiply that by 10 to cover all others who failed to be counted (and to more effectively deliver inclusiveness), and assess the right amount considering current median market values (with room for corruption and systemic pilferage since we cannot yet change the culture in an instant and promote integrity over night; the majority are still thirsty for it considering the past scarcity they may have endured), and multiplied further to sustain a 15-month period (not 12 but all the months before the next budget is given, including systemic delays). On top of that, a security budget is made in the amount of 35% of the total to cover possible errors and inadequacies.

    The amount must be in the Trillions and not Billions, considering the level of poverty of the country, and considering that VALUE these days are no longer relative to LOCAL PRICES but contrasted on a global level since we have opened our culture to external comparison and trading. Value is cultural and relativistic, and for as long as Filipinos are aware of foreign values, they would tend to compare local values with it. So we better keep up, or our forecasts and courses of actions WOULD FAIL. Miserably fail.

  • juan_luisjr

    Hope balisacan is right this time, for the sake of our country. The big increase for agriculture may have reduced rice importation but it did not reduce rural poverty which it was supposed to. Hence, i hope this program of increased infra spending that he speaks of will be more effective.

  • carlcid

    We can expect more platitudes from Mr. Balisacan. He has learned his lesson well, after being bawled out by the president for pointing out that poverty has been at the same level as in 2006, despite the much-ballyhooed growth narrative.

    The increased budget for infrastructure is welcome, and I hope it is carried out primarily in rural areas, which need it most. However, it would be too much to ask for a year’s worth of infrastructure spending to make a significant dent on the incidence of poverty. From being modest and pragmatic, Balisacan has evolved into a spinner of hyperbole, as he latches onto the administration’s newly-adopted buzzword of “inclusive growth”.

    Balisacan’s embellishments that “the proposed infrastructure budget for 2014, which is 35 percent higher than the P295 billion set aside for this year, the government could substantially boost employment and, in the process, increase household incomes”, while pleasing to the ears, are at best taken with a grain of salt. A 35% increase in infrastructure spending will not make an instantaneously dramatic impact. Not immediately. Unless Mr. Balisacan has learned his lessons in politics only too well, and plans to fudge the figures.

  • IntelligentFund

    Where in the world did he get that presumption?

    • lanceads

      from logic.. think about it.

      • IntelligentFund

        Logic? You may be pointing to deductive reasoning. So if you spend billions for infrastructure, there is a big drop in poverty levels. Logical? Probably not. Lacks consistency. GMA spent heavily on infrastructure, did poverty levels go down. No. On that point alone, logic is not the best support to his argument.

  • graftbuster

    Poverty will never go away for as long as the CORRUPT LIFE-STYLE PRACTICED BY MANY AMONG US EXISTS. All these people should be rooted out from all government departments and agencies starting from the Office of the President to the grassroots level. Also, put away forever in jail the likes of Napoles and similar evil syndicates in the private sector. Only after these top-to-bottom cleansing in our society and total rejection of our corrupt way of life have been completed can we expect to reduce poverty.

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