LOCAL think tank Ibon Foundation Inc. estimates that it would cost taxpayers P250 billion in the next 10 years if the government implements its new conditional cash-transfer (CCT) program.
Ibon based its estimate on the government’s plan to increase the budget for the CCT program to P39.5 billion in 2012, representing an 86-percent increase or P18.3 billion over the P10-billion allotment in 2010.
In a statement, Ibon said the amount and any increase would be “onerous,” considering there are no major studies on the actual impact of the program on the lives of the poor.
“Initial estimates show that the program will cost some P250 billion over a decade. The more money the government spends on the program’s uncontrollable expansion, the harder it will be to look at the program objectively,” Ibon said.
“A fourfold budget increase in the program from P10 billion in 2010 to P39.5 billion in 2012 is reckless in the absence of a meaningful assessment on how well this money is being spent or indeed better spent elsewhere,” it added.
To justify the proposed budget increase, Social Welfare Secretary Corazon “Dinky” Soliman on Monday said the agency plans to increase the number of beneficiaries to 3 million households in 2012, which will be given a total of P13,000 each next year.
Soliman said the program, which was started by the previous administration, has benefited the poor, especially children in depressed communities, and that Congress should support it by adding P16 billion more in the agency’s budget for next year.
“The budget is biased toward the poor and the vulnerable sectors…. This will keep poor children in school and keep them healthy,” she told lawmakers during a budget hearing.
She said that under the program, more and more poor families receive monthly stipends on condition they send their children to school; pregnant mothers are required undergo regular checkups to qualify.
“The beneficiaries understand that it is a co-responsibility and that there are conditions they have to comply with for them to continue receiving cash grants,” she said.
Soliman also said they are already formulating an “exit plan” such as providing entrepreneurial skills to poor households.
“The DSWD and the beneficiaries are aware that the program is only good for five years…. We recognize the need to open up opportunities for sustainable livelihood to continue support for health and education for children,” she said.
Congressmen on Monday proposed to slash P5 billion from the planned P39.5-billion allocation for the CCT program for 2012 and channel it to the Department of Trade and Industry (DTI) for its One Town, One Product (Otop) and other livelihood programs.
By doing this, the lawmakers said, the government would boost the development of entrepreneurship, particularly in the provinces, instead of just giving away monthly dole-outs.
At the DTI budget hearing on Monday, where the agency presented its P3.116-billion proposed budget for 2012, congressmen were disappointed with the decision of the Department of Budget and Management (DBM) to allocate only P67 million to the department’s Otop program, which is helping the micro, small and medium enterprises (MSME) in the provinces to grow their business.
Rep. Luis Villafuerte of Camarines Sur said that instead of giving the proposed P39.5 billion entirely to the DSWD for the CCT, P5 billion of it should be channeled to projects that would boost self-employment and entrepreneurship.
“We will submit a manifestation to the President to put some funds to job generation, because P80 million for Otop is a big joke. What we want is one project per barangay and we have 42,000 barangays,” Villafuerte said.
Bayan Muna Rep. Teddy Casiño agreed with Villafuerte’s proposal, noting that as chairman of the MSME development committee, he receives numerous complaints about the lack of financial and technical support from the government.
“They always ask for support for their businesses, not allowance, because they want to be productive. This is what I think we should fund, not CCTs which are basically monthly allowances,” he said.
Baguio Rep. Bernardo Vergara is also supporting the proposal of Villafuerte to give the additional P5 billion to the DTI, noting that “money begets money,” while Cagayan de Oro Rep. Rufus Rodriguez said the DTI should at least get the P200 million that it originally asked from the DBM for its Otop program.
But while the congressmen are willing to give the DTI more funds, Trade Secretary Gregory L. Domingo was not too receptive to the idea. He said they already agreed not to ask for additional budget from the DBM other than what was allocated.
Ibon said it would be better for the government to allot the funds for the CCT to address other needs that would help address education and health-related Millennium Development Goals.
For instance, it said the country is in need of additional classrooms, teachers, desks, public hospitals, health workers and rural infrastructure so the country can achieve universal education and improve maternal health—the main reasons for the implementation of the CCTs—more swiftly.
And while the World Bank and the Australian Agency for International Development had released a report on the impact of the CCT, according to Ibon, the study only came up with simulations on the possible or potential impact of the CCTs on the lives of the poor.
The study of the World Bank said the CCT could increase incomes by 12.6 percent, reduce poverty by 6.2 percentage points and result in a 6.6-percent reduction in income inequality.
“Using an approach that it admitted had ‘important shortcomings’ and ‘[without] data on compliance at the household level,’ it hypothesized that the program ‘could’ increase annual incomes of beneficiaries by 12.6 percent, resulting in the reduction of poverty incidence among them by 6.2 percentage points,” Ibon said, adding that this highlighted the lack of comprehensive studies on CCTs even after four years of implementation.
Ibon said it estimates that at the end of 2011, the CCTs would cost the government some P44.4 billion.
Gabriela Party-list Rep. Emerenciana de Jesus said the increase in the allocation for CCTs only sustains the “culture of mendicancy.”
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By: Cai Ordinario, Max de Leon, Zaff Solmerin, Fernan Marasigan
Source: Business Mirror, Aug. 22, 2011
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