Conditional Cash Transfer Program in the Philippines: Pantawid Pamilyang Pilipino

Maryjoy Mella, Floren Camille Osido and Lemarie Suing

INTRODUCTION

Dr. Virola (2011), Secretary General of the National Statistical Coordination Board, said in his presentation of the 2009 Official Poverty Statistics that a Filipino needed PhP 974 in 2009 to meet his or her monthly food needs and PhP 1,403 to stay out of poverty. In 2009, a family of five needed PhP 4, 869 monthly income to meet food needs and PhP 7, 017 to stay out of poverty. Results of the latest Social Weather Stations (SWS) survey also revealed that one in every five Filipino households, or an estimated 4.3 million families, experienced involuntary hunger in the third quarter of the year 2011 (http://newsinfo.inquirer.net/84129/more-filipinos-going-hungry-survey-shows).

The Conditional Cash Transfer (CCT) programs serves as the government’s answers to the pressing issues regarding poverty. Calvo (2011) defines the CCT as programs that provide cash benefits to finance the basic needs and foster investment in human capital to extremely poor households. These benefits are conditioned on certain behaviors, usually related to investments in nutrition, health, and education.

The emergence of CCT programs occurred during the late 1990s, with Mexico’s innovative Progresa (now Opurtunidades) program emerging as one of the earliest schemes in 1997. The evidences highlighting the effectiveness of Progresa motivated a rise in similar programs across Latin America. Throughout the late 1990s and into the early part of the new century, CCT programs were implemented in Honduras, Brazil and Nicaragua.

CCT programs are presently being implemented in several Latin American countries including Brazil, Chile, Colombia, Jamaica, Mexico, and several more. Indonesia and Pakistan are only some of the Asian countries which employ the CCT programs as a major tool of their social policy. In general, these programs provide money and financial assistance to poor families under the condition that those transfers are used as an investment on their children’s’ human capital, such as regular school attendance and basic preventive health care. The main mission of most CCT programs is to prevent inter-generational transference of poverty, that is to say, investing in young children and providing them with the provisions necessary for better opportunities in the future.

Statement of the Problem

This study aims to assert the advantages, disadvantages and effectiveness of the Pantawid Pamilyang Pilipino Program (4Ps), the conditional cash transfer program in the Philippines, in addressing the poverty health care and basic education problems in the Philippines. The researchers strongly agree that the 4Ps can help alleviate, not intensify, the problem of poverty in the Philippines. Furthermore, the researchers believe that the 4Ps provides not only short term benefits but also long term assistance necessary for the improvement of the Philippine society.

Objectives

In respect to the previously stated problem, the researchers hope to accomplish the following objectives:
1. To assert the advantages of the 4Ps in addressing the poverty, health care, and basic education problems in the Philippines.
2. To discuss the disadvantages of the 4Ps as asserted by various groups and experts who have studied the program.
3. To confirm the beneficial effects of 4Ps by reviewing early assessments of the program.
4. To classify the challenges of the 4Ps and outline proposals by various sectors to improve it.

CONDITIONAL CASH TRANSFER IN THE PHILIPPINES

Pantawid Pamilyang Pilipino Program (4Ps)

A Conditional Cash Transfer Program is a program implemented by the government where money (cash grants) is given to eligible beneficiaries given that these beneficiaries comply with certain conditions such as nutrition, education, family development sessions, and other such services offered by the government. It is a means of helping the beneficiaries through provision of social and medical assistance and increasing the investment in human capital for society by providing education to those who cannot afford it.
Since 2007, the Pantawid Pamilyang Pilipino Program (4Ps) of the Philippines is the conditional cash transfer program implemented by the Department of Social Welfare and Development (DSWD), along with cooperative partner institutions such as the Department of Education, Department of Health, Department of the Interior and Local Government, and various other government institutions. The 4Ps was patterned after the conditional cash transfer programs in Latin American and African countries which have been proven successful as a poverty reduction and social development measure (DSWD, 2011).

The 4Ps is targeted at chronic poor households with children aged 0-14 years old who are located in poor areas. The cash grants range from PhP500 to PhP1,400 per household per month, depending on the number of eligible children. At the core of a CCT program is a social contract where a state provides financial resources to a family in exchange for that family’s fulfillment of certain tasks such as ensuring that its children’s attendance in school, regular visits to community health centers, participation in government-sponsored feeding programs and attendance in more specific trainings, to name a few (Somera, 2010). And according to Fernadez & Olfindo (2011), today, the program is seen more broadly as “a vehicle for enhancing coordination within the government in assisting the poor and for increasing the effectiveness of social protection programs.”

Though statistics have shown that the increase in the poverty incidence among population in 2003 to 2009, from 24.9-26.5%, is not so substantial, it is still an increase, and 26.5% implies that more than a quarter of the whole Philippine population is below the poverty threshold. The 4Ps has been created to address that problem of poverty and inequality in the country.

REVIEW OF RELATED LITERATURE

Advantages of the 4Ps

The “CCT programs address both future poverty, by fostering human capital accumulation among the young as a means of breaking the intergenerational transmission of poverty and current poverty, by providing income support for consumption in the short run” (Rawlings & Rubio, 2005, p. 33). Indeed, the main objective of the 4Ps and other CCT programs is to prevent inter-generational transference of poverty and help break the infinite cycle of poverty by providing the children the suitable educational and health assistance so as to help them develop the facilities for a better future. Investing in children’s human capital and ensuring that they grow into educated and healthy adults, is the equivalent of teaching them how to fish. Healthy, educated children ultimately have more choices in life and are able to become productive members of society (Bloom, 2008).

Furthermore, the implementation of the 4Ps lessens the incidence of child labor and other forms of child abuse. In cases of the other CCT programs implemented in other countries, there are two interrelated mechanisms found to help combat child labor. First, through their cash subsidy component, schooling’s directs costs are reduced, thereby inducing families to send their children to school, as opposed to work. Second, these programs require families to have their children attend school, 85% of the school days per month in the case of the 4Ps, in exchange to cash subsidy. This requirement increases the time children spend in school and reduces the time they can allocate to work (Gee, 2010). There is a noticeable increase in the number of enrollees in many elementary schools in areas included in the scope of the 4Ps, and kindergarten classes were being established to answer the need of the community in compliance to the condition of sending 0-5 years old children in day care centers and preschools (DSWD, 2009). Subsequently, if collaborative compliance to this requirement of the 4Ps is ensured, the literacy rate of the children is also expected to increase.

In the long run, the 4Ps as well as the other CCT programs, aims to establish social equality and mobility through education. As mentioned by Gundlach, Navarro de Pablo, & Weiser (2010), the centrality of education in poverty-reduction policies stems from the belief that education is a powerful equalizer and the main asset of most people. Sen & Dreze (as cited by Calvo, 2011) incorporates the notion of inequality and social exclusion as obstacles for the construction of a system of rights and opportunities. Accordingly, people are poor not just because of a lack of economic resources to satisfy basic needs, but also because they live in a social, economic and political system which does not provide equality of opportunities. The 4Ps intend to provide the basis for this much needed equality by providing the poor people with the education that they could not access otherwise.

Malnutrition, which is prevalent among extremely poor families, is also expected to decrease. Since it is a prime requirement for beneficiaries to avail of the health services being offered in their health centers such as pre- and post-natal services, vaccination, and periodical check-ups before acquiring their money grants, the health and nutrition of the poor families are safeguarded.

The 4Ps also promotes gender empowerment seeing as the responsibility of managing the cash grants are given to the mother. This decision is based on the experience in CCT programs showing that women make relatively better use of grant money by using it to purchase food and/or other necessities such as medicines, transportations and school supplies.
In the nutshell, the underlying concept of the CCT programs, and of the 4Ps as wells, is: once individuals are healthy, better fed, and educated, they will be able to overcome poverty in the long run (Valencia, 2009).

Disadvantages of the 4Ps

Like any other government program, the 4Ps also have its disadvantages that may encumber its helpful benefits. One of the most crucial characteristic of the 4Ps and other CCT programs implemented in other countries is its being a ‘demand-side’ intervention instead of being a ‘supply-side’ intervention. That is, in order to be considered as a beneficiary of the program, one must concede with the government’s demands and conditionalities (Coady & Parker, 2002). This is remarkably notable in the conditions concerning education and health services where the beneficiaries being brought into the education and health services system instead of expanding the education and health systems in order to reach them.

Furthermore, as previously mentioned, poverty in the country is not only caused by the lack of economical resources, but also because of socio-economic and political factors that prevent the equality and distribution of resources. Although the 4Ps aims to provide the poor with the education which is, otherwise, inaccessible, it does not directly answer the socio-economic and political problems that are the primary cause of poverty. In the case of the 4Ps in the Philippines, it does not answer the issues regarding the political and economic elite families. And poverty can only be totally alleviated if there are programs that could target its roots.

The 4Ps will also encounter some difficulties in achieving support from the other social classes, mainly because it does not benefit middle-income groups which have also been steadily affected by limited universal services and decreases in employment (Cuesta, 2007). These middle-income groups are also suffering from issues of poverty and limited access to educational and health benefits, but are not included in the target population of the 4Ps. The 4Ps is programmed to help only the extremely poor.

Another major disadvantage of the 4Ps implementation is that it requires a huge amount of finance which we do not have at the present. The 4Ps is a loan driven program, much of the funds constituting the conditional cash grants given to beneficiaries are generated from loans abroad, particularly from the United States. By the tail-end of August 2010, the Asian Development Bank (ADB) approved a US$400 million loan specifically for the 4Ps which will run from 2011 to 2014. This comprises 45.2 per cent of the total cost of US$884.2 million, where US$484 million serves as the government’s counterpart. Having ADB’s US$400 million in addition to the World Bank’s US$405 million, makes two-thirds of the whole 4Ps from 2009 to 2014 comprised of loans (Somera, 2010, p. 6). Arguments against the 4Ps point out that despite the large amounts of financial resources needed to implement the program; it does not generate guaranteed returns to the economy as much as infrastructure projects like construction of roads, bridges, and railways do.

CONCLUSION

The Pantawid Pamilyang Pilipino Programs poses many appealing objectives, goals and benefits for the poor families that comprises most of the Philippine’s population. The 4Ps is a good example of strengthening the government’s capability of distributing the country’s resources to those who are extremely in need. It is undeniable that there are many poor households that will benefit from the said program, and that the program covers the basic needs that otherwise would go unmet. Likewise, the government’s effort in making the country’s educational and health services system inclusive is a huge step towards social mobility and equality. The researchers feel strongly about the 4Ps’ principle that well-fed and educated citizens are imperative for a productive country and society.

However, it is also undeniable that the 4Ps, as well as the other CCT programs being implemented in other countries, is not the perfect solution. There are many insufficiencies that the program might face in the long run of its implementation. And as a new policy here in the Philippines, the 4Ps will certainly need further revisions and studies in the future.

Nevertheless, the researchers believe that for any government program to succeed, the government and the citizens must arrive in a peaceful consensus. The government’s duty is to secure that the people’s needs are provided and their rights are protected. And the citizens, in return, must use their full capacity to be productive and help the country. The researchers believe that the implementation of the 4Ps is a good example of the concurring responsibilities of the government and the citizens.

BIBLIOGRAPHY

Bloom, K. (2008, May 17). CCT in Philippines is ‘teaching people how to fish’. Philippine Daily Inquirer. http://opinion.inquirer.net/inquireropinion/columns/view/20080517-137087/CCT-in-Philippines-is-teaching-people-how-to-fish.

Calvo, C. (2011). Social Work and conditional Cash Transfers in Latin America. Journal of Sociology & Welfare, September 2011, Volume XXXVIII, Number 3.

Coady, D., & Parker, S. (2002). A cost-effectiveness analysis of demand and supply-side education interventions: The case of PROGRESA in Mexico. Discussion Paper No. 127. International Food Policy Research Institute.

Cuesta, J. (2007). Field report: On more ambitious conditional cash transfers, social protection, and permanent reduction of poverty. Journal of International Development, 19, 1016-1019.

Department of Social Welfare and Development (2009), Effects of 4Ps Evident in Mabini Schools, . Available from: Department of Social Welfare and Development, :  http://www.fo1.dswd.gov.ph/index.php?option=com_content&view=article&id=188%3Aeffects-of-4ps-evident-in-mabini-schools&Itemid=110 [Accessed: Dec 18, 2011].

Diokno, B, (2011), Will CCT help or hurt the poor? . Available from: University of the Philippines, School of Economics:  http://econ.upd.edu.ph/faculty/bediokno/2010/10/12/will-cct-help-or-hurt-the-poor/ [Accessed: Dec 18, 2011].

Gee, K. (2010). Reducing Child Labour Through Conditional Cash Transfers: Evidence from Nicaragua’s Red de Protección Social. Development Policy Review. November 2010;28(6):711-732.

Gundlach, E., Navarro de Pablo, J., & Weisert, N. (2001). Education is good for the poor. Discussion Paper No. 2001/137. World Institute for Development Economics Research.

More Filipinos going hungry, survey shows. Philippine Daily Inquirer. (September, 2011) http://newsinfo.inquirer.net/84129/more-filipinos-going-hungry-survey-shows

Somera, N, (2010), Politics, Patriarchs, Palliative and the Poor: Conditional Cash Transfer in the Philippines, http://www.forum-adb.org/docs/BP-201012.pdf [Accessed: Dec 17, 2011].

Valencia, E. (2009). Conditional cash transfer programs: Achievements and illusions. Global Social Policy, 9, 167-171.

Virola, R, (2011), 2009 Official Poverty Statistics, . Available from: National statistical coordination board, : http://www.nscb.gov.ph/poverty/2009/Presentation_RAVirola.pdf [Accessed: Dec 16, 2011].

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