Governor Alfonso V. Umali, Jr., Governor Jocel C. Baac, city and municipal mayors, Dr. Celia M. Reyes - CBMS Network Leader, colleagues in the government, friends from the private sector, ladies and gentlemen, good morning.

I would like to thank the CBMS Network for inviting me to deliver the keynote speech for today’s 9th CBMS-Philippines National Conference. Our theme “Enhancing Inclusive Growth and Employment Opportunities for the Poor” aligns well with the Philippine Development Plan (PDP) for 2011-2016. This gathering provides an opportunity for us to discuss how we can collaborate in realizing the vision for our country towards a more inclusive and sustainable growth.

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The economy was able to post a modest growth in 2011 despite the challenges (e.g. Euro Crisis, conflict in the MENA region, flooding in Thailand, Tsunami-related disasters in Japan). Economic data for 2012 suggest that our economy continues to grow rapidly. Following the more-than-expected growth of 6.3 percent in the first quarter of 2012, the second quarter GDP growth reached 6.0 percent, and the third quarter accelerated to 7.1 percent, making in first three quarters growth of 6.5 percent. This gives us a level of comfort that we will be able to reach the high end of the 5 to 6-percent growth assumption for 2012, as approved by the Development Budget Coordination Committee.

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Sustaining the growth momentum is one part of the challenge; the other is to ensure that this is more inclusive and shared by all. By this we mean that it should lead to more employment, and moreover, to better quality employment.

For full year 2012, the employment posted a 1.2 percent growth, slower compared with the 3.2 percent growth in 2011. This translated to 429,000 average net employment in 2012, way below the Philippine Development Plan, 2011-2016 target of 1 million employment generation per year. Also, underemployment rate worsened to 20.0 percent in 2012 from 19.3 percent in 2011. The unemployment rate of 7.0 percent is the same as in 2011.

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The Aquino administration is committed to reverse this long standing problem of “jobless economic growth” through the President’s “Social Contract with the Filipino People.” These commitments were fleshed out in the Philippine Development Plan for 2011-2016, to achieve inclusive growth.

The President’s Social Contract has five key priority areas that focus on transparent, accountable and participatory governance; poverty reduction and empowerment of the poor and vulnerable; rapid, inclusive and sustained economic growth; just and lasting peace and the rule of law; and integrity of the environment and climate change mitigation and adaptation.

These areas are reflected in the key strategies of the medium-term plan, as shown in the right side of the presentation. Let me now focus on the second and third priority areas.

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The government’s proposed budget for 2013 is PhP2.006 trillion, which is 10.5 percent higher than the PhP1.816 trillion budget this year. Priority will be given to social services, as what we have set in the budget’s output and outcome targets. For education, the target is to bring down the classroom gap to zero by end of 2013, instead of 2015. Teacher and textbook gaps will also be brought to zero by this year. Moreover, vocational and higher education will be aligned to support the development of key industries and the generation of more jobs. For social protection, the target is to cover all indigent households in the Pantawid Pamilyang Pilipino Program, or 4Ps, by 2016. The poorest 40% of the population will also be under universal health care by 2016, thereby attaining the health MDGs. For housing, the goal is to provide decent affordable housing to informal settlers.

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We should note that some headway has already been achieved concerning human resource development: For health, enrolment under the National Health Insurance Program or PhilHealth, has expanded from 74 percent in 2010 to 85 percent in May 2012. Under its sponsored program, around 5.2 million poor families identified through the National Household Targeting System for Poverty Reduction were already enrolled. Our target for 2013 is to reach a 100% coverage. The net enrolment rate in kindergarten, elementary and secondary have all increased from 2009 to 2011. For elementary, it increased from 89.4% (2009) to 91% (2011). Our government has adopted the K to 12 program that is designed to enhance the quality of our basic education. With the 12-year cycle of formal basic education, we will be able to produce quality graduates with competencies and skills relevant to the needs of the industry. The provision of various scholarship and student financial assistance (including grants and loans) continues to be the government’s forefront strategy to promote greater access to education and training. The 4Ps, which is the government’s major human development and poverty reduction program, has already covered 3.085 million household beneficiaries as of October 2012, exceeding the 2012 target of three million. In housing, the target is to provide direct housing for some 1.47 million households from 2011 to 2016. In 2011, the Housing and Urban Development Coordinating Council (HUDCC) and key shelter agencies have provided decent housing to 109,000 families. The Social Housing Finance Corporation, or SHFC, through its Community Mortgage Program, delivered housing assistance to about 16,000 families. This was, by far, the highest annual performance of the program, which was more than double the 7,109 accomplishment in 2010.

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There is also a need to boost competitiveness in all sectors. Encouraging agro-industry backed by a productive agriculture sector is one way to ensure inclusive growth. For agriculture, the issue of access to land has to be addressed, together with access to support services. To this end, the government aims to complete the distribution of land under Comprehensive Agrarian Reform Program – Extension with Reforms, or CARPER, in 2014. To develop the country’s agro-industry potential, the agriculture and fisheries sector is being supported by efficient value chains and well-integrated into the domestic and international markets. We are working continually toward a globally competitive and innovative industry and service sectors through the creation of a better business environment, improved productivity and efficiency, and enhanced consumer welfare. Our policies and programs are focused on key areas that generate high quality jobs, as well as those that substantially reduce the cost of doing business.

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We also realize that the high cost of doing business in the country is due to the bad state of our infrastructure. The problem has become so worse that it needs to be addressed urgently, but it will require massive infusion of resources. In some of these efforts, government funds would be an inefficient way of financing these projects. This is the reason why we have tapped the private sector through Private Public Partnership (PPP). The PPP Center listed 22 projects under the PPP scheme. These projects are intended to improve transportation connectivity through roads, airports and seaports, boost agricultural productivity, increase water service areas, and raise the quality of education and health.

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Now, what about the goal of massive investment in infrastructure? Government will continue to accelerate spending for investment in physical infrastructure. For 2013, the President’s proposed budget allots a substantial amount for capital outlay, which is about 18.9% of the proposed 2013 budget. For infrastructure, the proposed share for 2013 is 14.8%, or up from 13.9% this year. Note also that the total budget for 2013 is at least 10.5% higher than the budget in 2012. In absolute levels, the amount allotted for infrastructure in 2013 is almost 17.5% higher than the corresponding amount in 2012.

The Legislative and Executive departments are working closely to ensure that the budget are responsive to the priorities of the Aquino administration.

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The government strategies I have previously enumerated will hopefully result in better conditions for the poor. In the pursuit of commercial objectives, the poor can be engaged as suppliers, distributors, and even employees.

Most of the poor are in agriculture.

Companies in the fastfood chain business (e.g. Jollibee, Mc Donald, etc.) engage the poor for the supply of either raw or cooked ingredients. If the quality of the produce is not at par with business standards, then a capability-building program can be implemented beforehand.

Subcontracting is another arrangement where big companies engage the poor as suppliers of goods and services. Companies in the food manufacturing business (e.g. San Miguel, Vitarich and Monterey) engage the poor in contract growing of livestock such as chicken and swine.

Other companies may not require agricultural produce as inputs to their businesses. But they employ workers who consume food. These companies may still engage the poor by giving out food gifts and food bonuses to their employees, thereby increasing the effective demand for agricultural produce.

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The poor can be directly employed by businesses. They can be employed as tourism workers (e.g. hotel staff, guides, cultural entertainers, etc.), manufacturing plant workers, unskilled construction workers, etc. What this means is that the qualifications need not be unnecessarily set too high to give the poor better chances of being employed.

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Products can be packaged such that even the poor can afford them. This is especially necessary for health and hygiene products: medicines, soap, shampoo, toothpaste, milk, etc. They can be sold in smaller quantities or less fancy packaging (and perhaps sold under a different brand name) so that the cost can be reduced significantly. To reduce the possibility of the nonpoor benefitting from the reduced price, these products can be sold to sari-sari stores in the slum areas or to community cooperatives in the rural areas.

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We at NEDA view the CBMS which much promise as a critical tool for achieving inclusive growth and expanding employment opportunities for the poor. We are confident that evidence-based policy making and planning is possible through CBMS.

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We have seen how CBMS has been used for poverty diagnosis and as bases for action planning and investment.

More specifically, data generated from CBMS have helped formulate evidenced-based Barangay Development Plans, Comprehensive Development Plans (CDPs), Annual Investment Plans and other sectoral plans. CBMS has also provided critical data in the formulation of Local Poverty Reduction Action Plans (LPRAPs).

Finally, we have seen that CBMS has capacitated government to closely monitor the progress of our attainment of the Millennium Development Goals (MDGs), the Social Contract of the President, and the Philippine Development Plan (PDP).

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I am happy to note that to date, CBMS is implemented in 67 provinces, with 35 provinces which are province-wide, in 796 municipalities and 64 cities, and in 21,895 barangays.

Discussions are now on-going on how to have a unified data collection system which will harmonize the various existing data collection systems such as the CBMS, the NHTS, and the Registry System for Basic Sectors in Agriculture. We need to standardize concepts and definitions and have a common reference period so that the fish that DSWD, for example, is looking at is the same fish that LGUs, NGAs, NGOs, and everyone else is looking at.

With a unified data collection system, we will be planning for the same people at the national and local levels.

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Maraming salamat at mabuhay tayong lahat.

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