Poverty in the Philippines

PH social enterprise covers 2.5M poor Filipinos – study

MANILA, Philippines – Social enterprises in the Philippines have covered at least 2.5 million people living below the poverty line, according to a study commissioned by Oxfam.

The number, which is more than half of the total government count of poor Filipinos in 2012, could double if government lends a hand in promoting social enterprise, said Marie Lisa Dacanay, president of the Institute for Social Entrepreneurship in Asia.

The study, called “Poverty Reduction and Women Economic Leadership: Roles, Potentials and Challenges of Social Enterprises in Developing Countries in Asia,” covered Bangladesh, Indonesia, and the Philippines and was presented at the 1st Social Enterprise Advocacy and Leveraging Conference in Asia on November 25 to 27.

“Social enterprise should be a complimentary poverty-reduction strategy of the government,” Dacanay told Rappler on Thursday, November 27.

Social enterprises are businesses of traditional capitalism models but with solutions that seek to address long-term goals such as poverty.

In the Philippines, social enterprises can be classified as cooperatives, microfinance institutions, (MFIs), fair trade organizations, trading development organizations, and new-generation enterprises.

MFIs alone made the highest impact in reaching poor Filipinos, according to the study, with more than 90% of contribution among other social enterprises.

As of December 2013, the study cited that MFIs had 23,672 cooperatives, with a total combined assets at P266.80 million ($5.94 million*). Cooperative members were at least 12.6 million, although not all of the members can be considered “of the poor” and “serving the poor.”

Out of the 12.6 million members, about 2.5 million Filipinos are clients of non-governmental organization-linked MFIs.

“Microfinance therefore plays a significant role in providing business,” the study said.

The Philippines does not have an official count of social enterprises though, but researchers estimate at least 30,000 institutions have been providing programs and services in the country.

Government support not enough

Government statistics said there were 4.2 million of poor Filipinos in 2012, an increase from 3.8 million 2006.

The Asian Development Bank explained such was caused by a dearth of poverty reduction measures and insufficient job generation.

To address this pressing concern, the country needs to enhance its public-private partnerships (PPP), develop capital markets, and boost access to finance, said ADB Philippines country director Richard Bolt.

At present, government’s role in social enterprises is manifested through the Department and Trade and Industry, People’s Credit and Finance Corporation, Land Bank of the Philippines, and the Development Bank of the Philippines.

Other state-sponsored microfinancing programs also include the Livelihood Credit Assistance Program and the SME (small and medium enterprise) Unified Lending Opportunities for National Growth program.

But government efforts to support social entrepreneurship are not enough, Dacanay said.

At Thursday’s social enterprise conference here, stakeholders from different Asian countries urged lawmakers to pass bills supporting the industry which are pending in the Senate and Congress.

Two versions of the “Poverty Reduction through Social Entrepreneurship” bill aims to provide a backbone for institutions that are engaged with such business practice.

The bills are inspired by South Korea’s Social Enterprise Promotion Act which was put to law in 2007. (READ: Developing social enterprise: Lessons from Korea)

Current government regulations, such as taxing small cooperatives while giving tax holidays to big-ticket investments, do not jive well with the country’s bid to take the poor out from their predicament, Dacanay said.

Source: Rappler.com

Sen. Bam Refiles Vetoed Magna Carta of the Poor Bill

As the Philippines grows, no Filipino should be left behind.
Senator Bam Aquino emphasized this as he refiled Senate Bill No. 2370 or the Magna Carta of the Poor Act, which was vetoed by Malacanang last Congress for being ‘unrealistic.’
This time, Aquino expressed confidence that his version of the bill will be signed into law, saying it went through the necessary revisions and consultations with stakeholders before it was refiled.
“The bill is now fine-tuned to make the country’s strong economic growth felt by all of one hundred million Filipinos,” said Aquino, chairman of the Senate Committee on Trade, Commerce and Entrepreneurship.
In his explanatory note, Aquino said the country’s economic performance in recent years has been impressive and unprecedented. 
“Our 7.2% GDP growth in 2013 was the highest in the ASEAN earning the country improved investment grade ratings,” the senator said.
However, Aquino said the country still faces many challenges as millions of Filipinos are jobless and a fifth of the populace remains poor.
“The daunting task for the State is how to capitalize on its outstanding growth, the critically acclaimed reform efforts and the renewed global confidence, in order to make growth more inclusive and felt by all of the one hundred million Filipinos,” the senator said.
Aquino’s measure seeks to ensure the protection and promotion of five basic rights of every Filipino: the right to food, employment, education, shelter and basic health care.
“It supports the creation of a just and dynamic environment where prosperity is shared through the provision of adequate social services, enabling a rising standard of living and improved quality of life for everyone,” the senator explained.
Under the bill, concerned government agencies are mandated to establish a system that will provide opportunities for the full enjoyment of the five basic rights, which are essential requirements towards poverty alleviation.
The Departments of Social Welfare and Agriculture will focus on the right to adequate food while the Department of Labor will ensure that the poor’s right to decent work is assured.
The Department of Education (DepEd), Commission on Higher Education (CHED) and the Technical Education and Skills Development Authority (TESDA) will promote quality education while housing will be the responsibility of the Housing and Urban Development Coordinating Council (HUDCC).
The Department of Health, for its part, will assure that the poor’s right to highest attainable standard of mental and physical health is assured.
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