Informal Economy Budget Analysis in Philippines and ... - WIEGO

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WIEGO Working Paper N o 12Summary and ConclusionWhen compared with that of its Asian neighbours, the pace of growth under past and current economicand social policy reform programmes in the Philippines leaves much to be desired. In particular, povertyincidence reduction has been slow and the Gini coefficient of per capita income remains very high,suggesting that the fruits of economic growth and social reforms have not been trickling down equitably.Historically, every administration tends to introduce new poverty programmes while discontinuing the ones thatare associated with previous regimes even if these have been making good progress or just beginning to createpositive ripples. Poverty programmes are often pursued to meet short-term political goals. Given the penchantfor short-lived recoveries, anti-poverty programmes are weak, poorly-targeted and lacking in accountability andin key components. Under such circumstances, it is difficult to realise the full impact of such initiatives.Programmes for the poor as the core objective of every administration are embodied in the Government’sMTPDP that is drawn up every six years. Under the Arroyo administration, national policies spelled out inthe MTPDP espouse poverty reduction as an overarching goal. Moreover, the MDGs provide the frameworkin formulating the MTPDP’s social commitments and in identifying programmes and projects in theMTPIP. As such, programmes and projects intended to uplift the abject conditions of the most vulnerablesections of the population, particularly the working poor, most of whom belong to the informal economy, aresubsumed under the broad policy goal of social reform and poverty reduction. And the money dedicatedto back up policy declarations and plans is the ultimate indicator of the government’s sincerity to effectchange and serious resolve to combat poverty.Up to now, however, the concerns of the Filipino working poor and workers in the informal economy have notbeen fully integrated in the MTPDP. While the basic sectors, including the sectoral representative of the informaleconomy workers, are supposedly represented in the NAPC, major policy decisions are really monopolised bythe government leaders and officials. Likewise, at the local level, people’s participation has been institutionalisedthrough the Local Special Bodies provision of the Local Government Code, but the majority of the LGUs do notconvene these bodies. The poor remain passive recipients of government programmes and projects. This is onereason for the deficit of programmes and projects intended specifically for their upliftment. As earlier noted, evenin the annual GAA and in the Quezon City annual budgets, there is an obvious lack of programmes for the poor’sprotection and socio-political-economic empowerment. To a limited extent, this lack is usually provided for byinternational and national development organisations and local NGOs and POs.With the government’s focus on poverty reduction, the challenge is to ensure that policies and investments relativeto effective implementation of programmes are coordinated, consistent, properly sequenced and responsive to thenational and local development context. Where government resources are limited, making effective and efficientinvestments is vital for developing countries like the Philippines. When a large share of the labour force is engagedin the informal economy, it is imperative that informal enterprises and workers are integrated into economicpolicies. Likewise, it is imperative that gender is integrated because ‘real poverty reduction cannot be realisedwithout progress towards gender equality and the empowerment of women.’ (Dorotan, 2007: 60–1)Whether the benefits of public spending materialise and accrue to the poor in general, and to the workers inthe informal economy, in particular, ultimately hinges on the efficiency of execution and on ethical governmentleadership and governance that is transparent, accountable, gender-responsive and results-oriented.In the end, this paper will argue that national and local government budgets in the Philippines will make adifference to the lives of the poor informal economy workers, particularly the home-based workers, street vendorsand waste pickers of Quezon City, ONLY when public expenditure provides them with sustainable livelihoodsand social protection, when they are politically empowered, when their basic human rights and entitlements areprotected and upheld, and lastly, when they acquire decent quality of life, meaning they are no longer poor.31
WIEGO Working Paper N o 12AbbreviationsABCADAADBAFPAHMPAIPASBBBCBDTBESFBRWBSMEDBULASIBWYWCARLCARPCCTCDPCEDAWCIDACITCCLIPPSCMPCOACSAPDADARDBMDBPDepEdDILGDNDDOHDOLEDPWHDSWDDTIEOEPWMDFACFGDFSPFYGAAGADGDPGFIGOCCICTAlleviate poverty, Build-up the city and Compete on efficienciesAutomatic Debit AccountAsian Development BankArmed Forces of the PhilippinesAccelerated Hunger Mitigation ProgramAnnual Investment ProgrammeAnnual Supplemental BudgetsBishops’ Businessmen ConferenceBureau of Domestic TradeBudget of Expenditures and Sources of FinancingBureau of Rural WorkersBureau of Small and Medium Enterprise DevelopmentBuild-Up a Long-term and Alternative Source of InvestmentBureau of Women and Young WorkersComprehensive Agrarian Reform LawComprehensive Agrarian Reform ProgramConditional Cash TransferComprehensive Development PlanConvention on the Elimination of Discrimination Against WomenCanadian International Development AgencyCottage Industry Technology CenterCapacity Development of Local Institutions to Promote and Protect the Informal SectorCommunity Mortgage ProgramCommission on AuditCore Shelter Assistance ProjectDepartment of AgricultureDepartment of Agrarian ReformDepartment of Budget and ManagementDevelopment Bank of the PhilippinesDepartment of EducationDepartment of Interior and Local GovernmentDepartment of National DefenseDepartment of HealthDepartment of Labour and EmploymentDepartment of Public Works and HighwaysDepartment of Social Welfare and DevelopmentDepartment of Trade and IndustryExecutive OrderEnvironmental Protection and Waste Management DepartmentFamily Access CardFocus Group DiscussionFood for School ProgramFiscal YearGeneral Appropriations ActGender and DevelopmentGross Domestic ProductGovernment Financial InstitutionGovernment-Owned and -Controlled CorporationInformation Communication Technology32
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