TARGETING IN THE PHILIPPINES

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The literature distinguishes between two types of targeting – broad and

narrow targeting. Broad targeting specifi es the intervention. The effectiveness

of the strategy lies in the comparative propensity of the poor to utilize

the intervention more intensively than the non-poor. Meanwhile, narrow

targeting stipulates inclusion and exclusion criteria to distinguish qualifi ed

benefi ciaries (the poor) from the non-benefi ciaries (the non-poor). Broad

targeting may probably result in substantial leakages, but narrow targeting

may entail signifi cant administrative costs. In practice, the design of antipoverty

projects employs both types of targeting.

Poverty reduction has always been a central element of the development

effort of the government, as articulated in its development plans and offi cial

policy statements. By and large, only the emphasis and the strategy to

achieve these goals have changed over recent decades.

The development program of the Aquino administration (1986–92)

primarily stressed the alleviation of poverty, the generation of more

productive employment opportunities, and the promotion of equity and

social justice. Unlike previous programs, which had emphasized importsubstituting

development, the new program called for the removal of policy

biases against agriculture and the rural sector, with agrarian reform serving

as the program’s key focus. The centerpiece of the administration’s poverty

reduction strategy was the Tulong sa Tao program, of which provision of

subsidized credit was a key element.

The Ramos administration (1992–98) focused on accelerating the pace of

economic growth, by building the international competitiveness of domestic

industries, reforming regulation in services and industry, and investing in

basic infrastructure. It also had a Social Reform Agenda for achieving

its human development targets. A package of government interventions

organized around ‘fl agship programs’ for the country’s 20 poorest provinces,

the Social Reform Agenda is considered to be the fi rst effort of the Philippine

public administrative system to organize the various sectors of government

toward securing so-called minimum basic needs before attending to other

demands of priority sectors.

The Comprehensive and Integrated Delivery of Social Services (CIDSS)

was the fl agship anti-poverty project of the Ramos administration. The

basic strategy of the CIDSS was to ‘break down the culture of poverty’.

It was based on the concept of empowerment. Previous programs were

ineffective either due to underutilization of funds, or if utilization was high,

impacts were not sustained, and the thinking was that this was because

they did not coincide with the needs of the target benefi ciaries, who had

no sense of ownership of the anti-poverty projects involved. Under the

CIDSS, benefi ciary communities were organized with the help of full-time

community workers, and were taught to identify their problems, prepare

a work program, mobilize additional funding resources as necessary and

implement projects themselves. Civil society groups were also included in

all the project stages.

The CIDSS employed a minimum basic needs approach in project

prioritization. The approach used a set of 33 indicators, spanning the

different basic needs for survival (food and nutrition, health, water and

sanitation and clothing), security (shelter, peace and order, income and

employment), and an enabling environment (basic education and literacy,

people’s participation, family care and psycho-social needs). Priority projects

were those corresponding to the top unmet ‘needs’. In practice the most

common projects were day care centers, water supply systems, sanitary toilet

facilities, shelter assistance and credit provision. Others included were skills

training programs and school facilities. The innovative contribution of the

CIDSS was the mobilization of the community to participate in all project

stages. In implementation within provinces priority was given to the poorer

municipalities and within these to poorer districts (barangays).

The Estrada administration (1998–2001) came to power with a lavish propoor

agenda. It recognized the imperative of broad-based rural development

to win the war against poverty. Its Medium-term Philippine Development

Plan for 1999–2004 identified the main elements of the development

strategies required to spur growth and achieve sustainable development

in rural areas. The plan envisioned, for example, an aggressive delivery

of basic social development services, removal of policy and regulatory

distortions, sustained development of rural infrastructure, improvement

in governance, and macroeconomic stability. The administration’s fl agship

program for poverty alleviation was the Care for Poor (Lingap Para sa

Mahihirap) program, which involved the identifi cation in each province

and city of the 100 poorest families, who would be provided with a package

of assistance, including livelihood development, price support for staple

foods, medical assistance, socialized housing, and a rural waterworks

system. Several modalities were employed in the selection of families, but in

principle the aim was to use data on unmet minimum basic needs. If there

were no data available, local social workers were consulted to identify the

poorest families.

The ascension to power of the Macapagal-Arroyo administration

(2001–2004) gave birth to a new program of direct poverty alleviation

dubbed KALAHI (Kapit-Bisig Laban sa Kahirapan) which covers asset

reform, provision of human development services, creation of employment

and livelihood opportunities, participation of so-called basic sectors in

governance, and social protection and security against violence. Interventions

are delivered using the administrative apparatus of national government

agencies and local government units, but the emphasis as in earlier programs

is on local community empowerment.

The KALAHI has been combined with the earlier Comprehensive and

Integrated Delivery of Social Services (CIDSS) program in the KALAHICIDSS.

The principal development activity is small-scale infrastructure

work. These projects should provide needed physical infrastructure and

thereby benefi t the local community, and at the same time serve as pilot

projects for the barangay governing bodies, in terms of developing better

planning, implementation, operation, and management techniques which will

result in more self-suffi cient organizations. Project choices are determined

by communities themselves. The project employs multi-stage targeting. At

the fi rst stage, provinces are ranked on the basis of poverty incidence and

the top 40 (roughly the poorest one-half) are selected. At the second stage,

only the poorest quarter of municipalities are selected. The selection is based

on a poverty map developed by Balisacan et al. (2002). The poverty map

uses an aggregation methodology applied to proxy indicators of poverty.

All barangays in the benefi ciary municipality are included in the project to

access grants. A major modifi cation from the old CIDSS is the formation

of an organization within the community that operates in parallel with the

local barangay council. This has resulted in confl icts in some barangays,

since it is the community organization that identifi es a project, prepares

the program of work, and monitors implementation, although the local

barangay council is called upon to provide the counterpart funds.

Cutting across all of these initiatives has been the operation of the

National Food Authority (NFA), which implements a number of subsidy

schemes, the most important of which is that for rice. Given the importance

of rice for the poor as both a consumer and producer good, the operations

of the NFA potentially have strong poverty implications.4 The authority

aims to meet potentially confl icting objectives of maintaining a fl oor price

for producers and a ceiling price for consumers of rice. NFA buys the grains

from the farmers during times of bumper harvest, when the buying price is

higher than the market price. The program essentially provides a subsidy to

the farmers, so that they are assured of a stable income, independent of the

supply situation in the market. NFA procures grains only from ‘bona fi de’

farmers. Verifi cation is done through the use of a passbook that is issued

only to farmers. However, in practice in recent years the NFA has been able

to procure only less than 5 per cent of total rice production, so it has only

a very marginal impact on average producer rice prices.

On the consumer side subsidies are provided for sales of supported goods

in selected retail outlets and NFA rolling stores. The main objective of the

program is to protect consumers against large increases in the price of basic

commodities, not just rice but also sugar, cooking oil and more recently

common drugs. NFA has a monopoly control over rice imports and its

import quota has combined with relatively high import tariffs on rice to

keep domestic consumer prices well above world prices (Roumasset, 1999).

Targeting is essentially through self-selection as there is no fi lter mechanism

to exclude non-bona fi de customers. Sales are made as long as the customer

is willing to buy from the NFA retail stores and outlets, which in principle

should be in depressed urban areas.