What it would take to halve poverty

THE Philippines could meet the Millennium Development Goal (MDG) deadline to halve poverty incidence by 2015 if, in spite of the expected rise in the number of poor families last year (the data still to be released), the country reduces poverty incidence by 2.05 percentage points every year.

The National Statistical Coordination Board (NSCB) expressed this belief after an analysis, but said this rate of poverty reduction has never been achieved in the country. Since 1991, the base year used for estimating the targets for the MDGs, the average annual decrease in poverty incidence every year is only around 0.8267 percentage points.

The poverty data of the Philippines is based on the Family Income and Expenditure Survey (FIES) of the National Statistics Office (NSO) taken every three years. The last FIES was in 2009, at the height of the global crisis and typhoons Ondoy and Pepeng.

Because of this, economists, including poverty expert and University of the Philippines School of Economics dean Dr. Arsenio Balisacan, have earlier estimated that poverty incidence would likely increase in 2009 by 2 percentage to 3 percentage points to around 35 percent from the current level of 32.9 percent.

“To achieve MDG 1 by 2015, the required annual decrease in the poverty incidence in 2010 to 2015 is 2.05 percentage points, which, given past achievements—1991 to 2006—is quite unlikely but which remains achievable depending on the success of the poverty-reduction programs between 2010 to 2015,” the NSCB said in a document prepared by officer in charge of Social Sectors B Division Bernadette B. Balamban and Statistical Coordination Officer II Mechelle M. Viernes.

Assuming poverty incidence was 35 percent last year, the NSCB said this means the actualized rate of decrease in poverty incidence is only 0.5722 percentage points, or only 0.6077 percentage points every year since 1991, not even a third of the rate necessary to meet the 2015 deadline as estimated.

From a statistical standpoint, economists like UA&P Strategic Business Economics Program director Victor Abola said if the country records a 35-percent poverty incidence, it is already “very unlikely” that poverty can be halved by the MDG deadline, which is only five years away.

Abola said one of the crucial points is that no one expected the global economic crisis to happen, and this has become a significant factor in reducing poverty incidence in the country and all over the world.  “[It is] very unlikely that the poverty rate can be halved by 2015. The present government is only targetting 22 percent by 2016, I think. Half  [of a 35-percent poverty incidence]  would be 16 to 17 percent,” said Abola.

Former Budget secretary Benjamin Diokno said there is a “practically zero” probability of the country meeting the poverty-reduction goal by 2015 after the food and oil crises, apart from the global economic crisis, forced more Filipino families into the ranks of the poor.

Earlier, National Economic and Development Authority Director General Cayetano W. Paderanga said because of the “new global environment” there is a chance that several sectors will be left behind in terms of the MDGs after 2015 and that’s why the government is crafting policies for meeting their needs post-2015.  –Cai U. Ordinario / Reporter, Businessmirror