NRO5 MR No. 2020-01
January 28, 2020
27 in Every 100 Bicolanos were Poor in 2018
Poverty incidence among population or the proportion of the population living below the poverty line to the total population has substantially decreased to 26.8 percent in 2018 from 39.5 percent in 2015. This means that 27 in every 100 Bicolanos were considered poor in 2018. Around 678,000 Bicolanos eased out of poverty in 2018 from 2015. This shows that the region is on track in meeting its poverty targets under the current Bicol Regional Development Plan (RDP) which is to reduce poverty incidence among Bicolanos to 26.0 percent by 2022.
On the poverty incidence among families or the proportion of the families living below the poverty line to the total families, the Bicol Region also registered lower poverty incidence at 19.9 percent from 30.8 percent in 2015. Around 120,000 families eased out of poverty in 2018 from 2015 (Table 1).
Table 1. Bicol Region Poverty Statistics, 2015 and 2018
|Poverty Incidence Among Families||Poverty Incidence Among Population||Annual Per Capita Poverty Threshold||Poverty Incidence Among Families||Poverty Incidence Among Population||Annual Per Capita Poverty Threshold|
*Revised/updated based on the following: a) rebasing of the CPI market basket of prices from 2006 to 2012; and b) adoption of the 2015 PopCen results for the weights in the FIES.
All provinces in the Bicol Region had improved poverty situation in 2018. The Province of Catanduanes recorded the lowest poverty incidence. Poverty incidence among families in Catanduanes substantially reduced to 14.4 percent from 33.6 percent in 2015 while poverty incidence among population reduced to 20.3 percent from 43.4 percent in 2015. Following the province of Catanduanes with the lowest poverty incidence are the provinces of Albay and Sorsogon, respectively.
The critical factors that contributed to the improvement in Bicol’s poverty situation are (a) sustained economic growth, (b) increase in the salaries and wages, (c) improved labor market conditions, and (d) implementation of newly-enacted laws like the Universal Access to Quality Tertiary Education Act, the Tax Reform for Acceleration and Inclusion (TRAIN) Law, among others.
The Bicol Region’s economy grew the fastest among the 17 regions in the country in 2018. Bicol hit a solid 8.9 percent growth rate from 5.0 percent in 2017, and remains within the target set under the Bicol RDP 2017 to 2022. The growth of the economy was demonstrated with the improved agriculture and fishery services, more economic opportunities in industry and services, and improved social services.
The increased access to economic opportunities for micro, small, medium enterprises (MSMEs) is vital in increasing income earning abilities of the people, hence decrease the level of social inequalities. The Department of Trade and Industry (DTI), through its Internationalization of MSMEs program, encouraged participation in the Trade and Business Mission to the 2018 MIHAS trade fair in Malaysia and the 2018 Hongkong International Home Textile and Furnishing Fair which generated at least US$0.0714 million in sales. The 2018 Orgullo Kan Bikol or OK Bikol Regional Trade Fair generated PhP28.01 million in sales which was participated by 164 exhibitors including new MSMEs.
Bicol Region managed to grow over the course of three years despite of the occurrence of calamities, weather disturbances, volcanic eruption, rising prices of goods and services and depreciation of the peso. Although the regional inflation rate which measures movement in prices of major commodities climbed from 5.4 percent in January 2018 to a peak of 10.1 percent in September 2018, it slowed down to 7.0 percent in December 2018. Despite the rice importation, the Bicol Region topped the list among those with the highest rice inflation rate of 13.8 percent in September 2018. The passage of RA 8178 or the Agricultural Tariffication Act to reform the agriculture sector is expected to bring down the prices of rice and provide farmers better access to farming technologies and high-yielding variety crops. In spite of the fast increase of prices of major commodities in the third quarter of 2018, the slower increase of prices in 2016 to 2017 could have brought poverty situation down in 2018. On the average, inflation rate was only 3.1 percent from 2016 to 2018.
The salary of government employees increased from 2016 to 2018 with the first to third tranche of the Salary Standardization Law (SSL). In 2018, Congress Joint Resolution No. 1, Series of 2018 was passed authorizing the increase in base pay of Military and Uniformed Personnel (MUP) in the government which adjusted the compensation package of MUP. For Bicol Philippine National Police personnel alone, 8,578 police non-commissioned officers and 433 police commissioned officers benefitted from this modified Base-Pay schedule in 2018. In 2018, the minimum daily wage in the region for establishments employing 10 workers above also increased to PhP310.00 per day from PhP290.00 per day.
The intensified implementation of the government’s social assistance programs provided additional income to the poorest sectors of the society. Some of these programs are the Pantawid Pamilyang Pilipino Program (4Ps), Social Pension Program, and Unconditional Cash Transfer (UCT). In 2017, the 4Ps covered 375,398 households regionwide. The Social Pension Program covered 100 percent of poor senior citizens regionwide. The implementation of UCT Program, which started in 2018, provided cash grant of 200 pesos per month to qualified beneficiaries. This served as additional monies in their pockets which they spent for their basic needs. The UCT is one of the social mitigating measures under Republic Act (RA) No. 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) Law to help cushion the impact of inflation on the vulnerable sectors.
The TRAIN Law increased the take-home pay of income earners and real incomes of 4Ps beneficiaries with the reduction in personal income tax. With TRAIN, an employee earning PhP250,000 or less every year does not have to pay for personal income tax. Tax exemption also covers 13th-month pay and other mandated bonuses, giving income earners more chances of saving money.
With the RA No. 1091 or the Universal Access to Quality Tertiary Education Act, signed in 2017 which provides free tuition and other school fees in state universities and colleges, local universities and colleges and state-run technical-vocational institutions, expenses for education were channeled to other expense items and partly to the savings of the families.
In 2018, the labor force in the region reached to 4.1 million where the labor force participation rate is 61 percent. The average employment rate improved to 95.4 percent in 2016 to 2018, compared to 93.9 percent in 2013 to 2015. The increase in the number of employed persons was attributed to the jobs created by government projects, the opening of new malls, hotels, and other commercial establishments in the various areas in the region. The Build, Build, Build Program of the government provided employment to Bicolano laborers, skilled and unskilled. The total cost of projects of DPWH Region 5 for 2018, which are part of the Build, Build, Build Program totaled to PhP41.02 Billion. With a vibrant economy that continues to generate good jobs, the average underemployment rate for 2016 to 2018 improved to 29.6 percent, compared to 34.6 percent in 2013 to 2015. This shows that the quality of jobs may have improved as can be gleaned from the reduced number of employed persons wanting more hours of work.
Among the hindering factors to robust poverty reduction are security issues and vulnerability to disasters. In 2018, the Philippine Army recorded 86 municipalities and 274 barangays in the region under security threats. In addition, Typhoon Nina devastated three provinces in the region in 2016. Although rehabilitation and recovery measures were quickly put in place, the devastation has largely affected the lives of the people. The Bicol Region ensured that resilience and adaptive capacities of the communities against disaster and climate change are pursued.
Moving forward, the salary of government employees in 2019 continued to increase with the fourth tranche of the SSL. With the passage of RA No. 11466 or the SSL of 2019 last January 6, 2020, the salary of government employees will continue to increase in 2020 to 2022. The passage of the RA 11310 or the 4Ps Act signed in 2019 makes the 4Ps a permanent program of government. The RA 11261 or the First Time Job Seekers Assistance Act signed in 2019 provides that the first-time job applicants no longer have to pay fees for government documents required for employment. The approved intensification of the National Program on Population and Family Planning in 2019 will also help improve the poverty situation by reducing fertility rates. The Universal Health Care Act, signed in 2019, will guarantee equitable access to quality and affordable healthcare services for all Filipinos.
With globally competitive industries and services serving as the backbone of a sustained economic growth and reduced inequality, the government will push for the increased investments on MSMEs and human capital development. Programs that will steer career interest towards science, technology, and innovation such as the 7Ms and the Prototype Filipinnovation Portal, are necessary to build an innovative and entrepreneurial society. The 7Ms or Mindset Change, Mastery, Mentoring, Money, Machine, Market Access, and Models of Business, a framework being implemented by the DTI, aims to develop the Bicolanos’ mindset on entrepreneurship beyond employment. The Prototype Filipinovation Portal, a collaborative output of the Philippine Global Innovation Policy Accelerator Team, is an online portal envisioned to connect the innovation system in the areas of science, technology, research and development, policies, programs, projects, and market.
The government and private sector will continue to implement programs, projects, and policies that may lead to a more robust poverty reduction especially in accelerating human capital development and expanding economic opportunities.
It is desired that every Bicolano will be one in effort to sustain and enhance this improvement in Bicol’s poverty situation noting that the vision of a matatag, maginhawa, at panatag na buhay para sa lahat includes ending poverty by 2040.
Approved for Release:
Dir. AGNES E. TOLENTINO, CESO III
RDC Vice Chairperson