PNoy’s promises still ‘in progress’

By Rowena F. Caronan

FIVE YEARS AGO, when President Benigno S. Aquino III delivered his first State of the Nation Address (SONA), he made specific policy promises on economic reforms and job creation – on top of his overall promise of change: “Daang Matuwid” and “Kung walang corrupt, walang mahirap.”

Five years hence, Aquino’s SONA promises and those laid down in the Philippine Development Plan (PDP) for 2010-2016 are still a work in progress. In all of the targets he has sworn to achieve, he is falling behind the natural deadline of his presidency that comes on June 30, 2016.

The Aquino government has secured credit ratings upgrade for achieving record economic growth yet still, that growth has yet to turn inclusive and trigger jobs of sufficient quality and quantity for the Filipino poor.

Interviewed on the ABS-CBN News Channel, Socioeconomic Planning Secretary Arsenio Balisacan justified that no country or political administration has so far eliminated poverty and unemployment.

The promises he made

In his 2010 SONA, Aquino laid out his blueprint for job creation by boosting growth in the industry and streamlining business processes.

A year later, through his social contract, Aquino promised a government that prioritizes jobs that empowers Filipinos and provide them with opportunities to rise above poverty. He also said his government would create jobs at home so working abroad will be a choice rather than necessity. He promised to prioritize welfare and protection of those who choose overseas work.

More specifically, the Aquino administration’s PDP sought to reduce the number of poor Filipinos to 18 percent of the population, maintain an average economic growth of at least 7.5 percent annually, generate employment of one million per year, and reduce the unemployment rate to 6.5 percent by the end of his term in 2016.

What he has achieved so far

From 2011 to 2014, Aquino had boasted in his SONA credit ratings upgrades, and record runs of the stock market as evidence of a strong economy. This meant, he had explained, that the government could borrow funds for programs and projects at lower interest rates and more business would be attracted to invest in the country.

In his 2011 and 2012 SONAs, Aquino said his government had delivered on reducing the number of unemployed Filipinos. He said, “Is it not an apt time for us to dream of a day where any Filipino who wishes to work can find a job?”

In his 2013 SONA, Aquino reported additional jobs created in the BPO (business processing outsourcing) sector. He said: “Back in the year 2000, only 5,000 people were employed in this industry. Fast forward to 2011: 638,000 people are employed by BPOs, and the industry has contributed 11 billion dollars to our economy.”

In 2014, Aquino praised Labor and Employment Secretary Rosalinda Baldoz for adopting better labor resolution practices that helped reduce the number of labor strikes to less than 10 during that year.

He said: “Consider this: According to the National Conciliation and Mediation Board, since 2010, the number of strikes per year has been limited to less than ten. This is the positive result of the Department of Labor and Employment’s Single entry Approach, or SEnA, through which filed labor cases go through a 30-day conciliation-mediation period. The good news: out of 115 notices of strike and lockout in 2013, only one pushed through. This is the lowest number of strikes in the history of DOLE.”

The Aquino Presidency: Promises vs. Results

1. Reduce the number of poor Filipinos to 18 percent by 2016 – In progress

The poverty incidence among Filipinos (25.8 percent) in the first quarter of 2014 is still far from the target of 18 percent by 2016. In fact, this estimate by the Philippine Statistics Authority (PSA) shows an increase from the 24.6 percent in the same period last year.

PSA noted that the 2013 poverty estimate had been revised for consistency with the 2014 poverty estimates, which was based on the 2014 Annual Poverty Indicators Survey and did not include sample households from Batanes and Leyte.

2. Sustain economic growth of at least 7 percent for the five-year period – In progress

The annual growth rate of the Gross Domestic Product (GDP) averaged 6.3 percent from 2010 to 2014. The only time that the government has met its target of at least 7 percent annual GDP growth rate was in 2013.

In the first quarter of 2015, growth of the domestic economy slowed down to 5.2 from 5.6 percent in the same period last year.

In a statement, Balisacan explained that the “slower-than-programmed pace of public spending, particularly the decline in public construction” slowed the growth of the economy. Balisacan, however, said that the economy is expected to grow faster in the remaining quarters.

3. Increase the annual average output of different sectors for the five-year period: agriculture, fishery and forestry (2.5 percent to 3.5 percent), industry (9.3 percent to 10.3 percent), services (7.2 percent to 8.1 percent) – In progress

But while the government managed to increase the share of industry to the economic growth, it failed to do the same for the services, and agriculture and fishery sectors, which represent the poorest sectors.

Annual Gross Value Added (GVA) in industry grew by 8 percent on average from 2011 to 2013. But the agriculture, fishery, and forestry sectors grew only by 2 percent on average from 2010 to 2014.

According to the 2014 Socioeconomic Report of the National Economic and Development Authority (NEDA), the agriculture and fishery sectors had to grow “by an average of 10.8 percent for the remaining period (2015-2016) to achieve the lower-end target.”

Meanwhile, the government met its target for the services sector when it hit a 7.41-percent increase in 2012. But the services sector grew only by 6.62 percent on average from 2011 to 2014. In the first quarter of 2015, it grew by 5.6 percent compared with the same period last year.

4. Create a resilient external sector by increasing the share of the export industry to 51.6 percent of the economic growth and the value of merchandise exports to US$109.4 billion by 2016 – In progress

On average, exports represent 29.6 percent of the Nominal Gross Domestic Product from 2011 to 2014. The lowest rates were recorded in 2013 and 2014 at 28 percent and 28.7 percent, respectively.

Moreover, sales receipts from merchandise exports had continued to grow below the target. In 2014, total merchandise exports were valued at $61.8 billion or more than $7 billion short of the downscaled target.

5. Generate employment of one million annually and reduce the unemployment rate as low as 6.8 percent by 2016 – In progress

As of April 2015, the unemployment rate currently stands at 6.4 percent or above the government’s target. In 2014, the annual unemployment rate was estimated at 6.8 percent.

However, the employment generation from 2011 to 2014 had fall short of the target. Employment expanded from 36 million in 2010 to 38.7 million in 2014, with an average increase of 654,000. The 1-million annual target was reached only in 2011; employment generation dropped to about 500,000 in the following years.

According to Ibon Foundation, “comparable official figures for April 2015 clearly show the quality of work deteriorating.”

“The number of contractual and other workers in insecure and poorly-paid work has been increasing in the last two years. As of April 2015, 15.5 million or 40 percent of employed Filipinos were in just part-time work with likely very low pay and scant benefits.” — PCIJ, July 27, 2015