This document provides an executive summary of the Philippines' 2004 Common Country Assessment (CCA). The CCA is an analysis of the country's development challenges undertaken by the United Nations to identify priority areas for cooperation. Key findings include: - The CCA focuses on achieving the Millennium Development Goals but notes concerns that current progress is inadequate and the Philippines may fall short of many targets by 2015 without intensified action. - It defines the most vulnerable groups as the rural and urban poor, child laborers, children affected by conflict/without caregivers, trafficked women, displaced people, indigenous communities, and migrant workers. - Underlying causes of poverty and vulnerability are identified as inequitable economic growth

1. A Common View,
A Common Journey
A Common Country Assessment
of the Philippines
2004

2. 2 A Common View, A Common Journey
United Nations Resident Coordinator
Message
T HE United Nations’ Common Country Assessment (CCA) presents an analysis of the
development situation of the country. It analyzes the major challenges that the Government
of the Philippines, key stakeholders and the United Nations system have identified as being
critical for the Philippines. It builds upon the challenges identified in the Medium Term Develop-
ment Plan of the Government of the Philippines and the principles and goals arising from United
Nations conventions and global conferences, particularly those of the Millennium Declaration
and the Millennium Development Goals (MDGs). The Common Country Assessment clearly
identifies a number of key issues which, when addressed, can effectively make the greatest
impact on the lives of the poor and the vulnerable.
The United Nations’ Common Country Assessment analysis sets the stage for the United
Nations Development Assistance Framework (UNDAF), which represents the best thinking of
how the United Nations system can support the government and people of the Philippines in
addressing these issues. The formulation of a Common Country Assessment is an integral
part of the reform agenda of the Secretary General to bring about “a greater unity of purpose”
within the United Nations System’s operational activities for development.
The United Nations system is grateful to the Government of the Philippines and key develop-
ment partners for providing valuable inputs to this analysis. We are confident that the United
Nations Development Assistance Framework, which is based on the Common Country As-
sessment, will support the Philippines in its efforts to advance the development of the country
and its people.
DEBORAH LANDEY
United Nations Resident Coordinator

3. A Common Country Assessment of the Philippines 3
United Nations Country Team
Message
W e, the peoples of the United Nations determined... to reaffirm (our) faith in fundamental
human rights, in the dignity and worth of the human person, in the equal rights of men
and women and of nations large and small, and to establish conditions under which justice and
respect for the obligations arising from treaties and other sources of international law can be
maintained, and to promote social progress and better standards of life in larger freedom... and
to employ international machinery for the promotion of the economic and social advancement
of all peoples... have resolved to combine our efforts to accomplish these aims.
–– Preamble to the UN Charter
The United Nations System has been working with the government and people of the Philip-
pines to promote and preserve the basic rights outlined in the UN Charter for peace, security
and development. The Common Country Assessment (CCA) aims to provide a concise over-
view of the Philippines’ key development challenges in 2004 and identify priority areas for con-
tinued and future UN collaboration and coordination efforts. CCA findings set the stage for
more coherent and coordinated UN system programming under the United Nations Develop-
ment Assistance Framework (UNDAF). This common analysis is an integral part of the recent
reform agenda of the Secretary General to bring about “a greater unity of purpose” within the
UN System’s operational activities for development. It builds upon the challenges encountered
in the Medium Term Development Plan (MTDP) of the Government of the Philippines and prin-
ciples and goals arising from UN conventions and global conferences, particularly those of the
Millenium Declaration and the Millenium Development Goals (MDGs).
The UN System is grateful to the Government of the Philippines and key development part-
ners for providing valuable inputs to this analysis. We are confident that the United Nations
Development Framework (UNDAF), which is based on this common analysis, will support the
Philippines in its efforts to advance the development of the country and its people.

4. 4 A Common View, A Common Journey
Kariya Mei Werner Konrad Blenk
FAO Representative ILO Sub-regional Director
Kyo Naka Dr. Zahidul A. Huque
UNDP Deputy Resident Representative UNFPA Country Representative
Dr. Nicholas K. Alipui Dr. Raffaello Tarroni
UNICEF Country Representative UNIDO Country Representative
Thamrongsak Meechubot Dr. Jean Marc J. Olive
UNHCR Representative WHO Country Representative
Dr. Ma. Elena F. Borromeo Lowie C. Rosales
UNAIDS Country Coordinator UN-Habitat Country Coordinator
Sylvia Olive-Inciong Atty. Brenda Pimentel
UNIC National Information Officer IMO Regional Coordinator
Deborah Landey
UN Resident Coordinator

5. A Common Country Assessment of the Philippines 5
EXECUTIVE
SUMMARY
T he Common Country Assessment (CCA) is an in-depth analysis of the development prob-
lems in the Philippines, undertaken through a participatory process of consultations among
United Nations agencies, its development partners both in the government and civil society,
and with other donor agencies in the country. It builds upon the programme of reform launched
by the UN Secretary-General in 1997, preparing the UN for the challenges of the 21st century
and emphasising its mandate in developing standards and goals arising from UN conventions
and global conferences. In particular, the CCA was driven by the principles and goals of the
Millennium Declaration, especially the Millennium Development Goals (MDGs). It also builds
on the development objectives of the Government of the Philippines, articulated in its Medium
Term Development Plan as well as commitments made in the context of international conven-
tions, conferences and protocols.
The CCA process involved systematic issues analysis, in order to identify strategic areas of
cooperation. The CCA will form a part of the UN Development Assistance Framework (UNDAF),
an exercise to prioritise development challenges in the Philippines to be addressed commonly
by the UN system in future programming cycles.
Notwithstanding pockets of optimism, there is a shared concern that without concerted and
intensified action, the Philippines will fall short of achieving the Millennium Development Goals
by 2015. The glaring inequalities in Philippine society are unsustainable and reflect core issues
of ownership and access to resources, capital, information and power. The CCA, therefore,
argues that the poor and vulnerable groups must be at the core of the development agenda.
These groups include: the rural and urban poor; child workers; children without primary
caregivers; abused/trafficked women; displaced persons; children caught in armed conflicts;
and Indigenous Persons. Their multiple vulnerabilities make them among the most marginalised
groups in Philippine society. The assessment argues that the key underlying causes of poverty
and exclusion may be found in inequitable economic growth, unequal access to opportunities
and basic social services, inadequate economic and social infrastructure, unregulated trade
liberalisation, gender inequities and high fertility rates.
Within the framework of the diverse expertise of the United Nations organisations, key de-
velopment issues were identified, relating to governance, peace and security, ecological stew-
ardship, the rural and urban economies, as well as health, education, basic services and social
protection. It is believed that the United Nations can continue to add value in all of these areas.
The assessment concludes that though the challenges are great, the potential for progress
is high if all development partners –- including national and local governments, the private
sector, NGOs/CSOs, the academic community, the media, as well as the donor community –
renew their commitments to practice responsible governance, mobilise new resources, and
better target their assistance to areas that are characterised by the greatest disparities. It
outlines priorities and themes that should guide the development of the UNDAF. Finally, it
stresses that even augmented efforts will fail unless inequities are minimised, fertility rates are
significantly reduced, armed conflicts are resolved, and an HIV/AIDS pandemic –- which is
potentially just around the corner –- is averted.

6. 6 A Common View, A Common Journey
CONTENTS
Message of the United Nations Resident Coordinator 2
Message of the United Nations Country Team 3
Executive Summary 5
SECTION 1: INTRODUCTION 8
Objective of the CCA 8
Scope of the CCA 9
The CCA Process 10
Methodological Challenges 11
Document Organisation 12
SECTION 2: DEFINING THE DEVELOPMENT CHALLENGE 12
COUNTRY PROFILE IN BRIEF 12
DEFINING POVERTY AND VULNERABILITY 13
Income Poverty 14
Rural Poor 14
Urban Poor 14
Child Labour 15
Children Caught in Armed Conflict 16
Children without Primary Caregivers 16
Abused / Trafficked Women 16
Displaced Persons 17
Indigenous Peoples 17
Migrant Workers 17
UNDERLYING CAUSES OF POVERTY AND VULNERABILITY 18
Growth has been poor and not “pro-poor” 18
Inequities in Access to Opportunities and Basic Services 19
Poor Quality and Inefficient Distribution of Economic Infrastructure 20
Trade Liberalisation 20
Fertility Rates 21
Gender Inequities 22
SECTION 3: AREAS OF DEVELOPMENT COOPERATION 23
GOOD GOVERNANCE 23
Corruption 24
Weak Fiscal Management 24
Decentralisation 25
An Inefficient Bureaucracy 26
Concerns about the Judicial System 26
Deficiencies in the Political and Electoral System 27
PEACE AND SECURITY 27

7. A Common Country Assessment of the Philippines 7
ECOLOGICAL SECURITY 28
State of the Environment 28
Challenges to Ecological Security 29
SOCIOECONOMIC DEVELOPMENT 30
Sustainable and Decent Employment and Work Opportunities 30
Agricultural and Rural Development 31
MSME Development and the Informal Economy 32
HUMAN DEVELOPMENT 33
Health 33
Education 38
Basic Services 40
Social Protection 42
SECTION 4: FORGING A DEVELOPMENT PARTNERSHIP 44
Defining the Objective 44
Defining the Roadmap 44
Key Obstacles to MDG Realization 44
A Rights-Based Development Framework 45
Defining the Partnership: The Role for the United Nations System 46
The UN Comparative Advantage 46
Clear Priority Setting 47
Greater Engagement with Stakeholders 48
A Sense of Urgency 48
Peace and Security 49
HIV/AIDS 49
End Notes 50
SECTION 5: CCA INDICATOR FRAMEWORK 52
Explanatory Note
Indicator Framework
A. Millennium Development Goal Indicators 53
B. Contextual Indicators 59
C. Development Indicators 61
Thematic Indicators 61
Conference Indicators 87
D. Data Gaps 91
Tables, Side Boxes and Figures 92
Regional/Provincial Disaggregation of Some CCA Indicators 120
Acronyms 132
List of References 134

8. 8 A Common View, A Common Journey
SECTION 1:
Introduction
OBJECTIVE OF THE COMMON
COUNTRY ASSESSMENT (CCA)
In 1997, the UN Secretary-General
launched a reform programme to prepare
the United Nations for the challenges of the
21st century. These reform initiatives
emphasised the role of the United Nations in
developing a powerful set of standards and
goals arising out of UN conventions and
global conferences. As part of the
programme, several measures were pro-
posed to enhance the organisation’s capac-
ity to implement its development mandate,
particularly at the country-level. The Com-
mon Country Assessment (CCA) and the
UN Development Assistance Framework
(UNDAF) are integral parts of the Secretary-
General’s initiative.
This CCA represents a common instru-
ment of the United Nations to analyze the
national development situation of the Philip-
pines and to identify key development
issues. It articulates a shared vision and
framework for the UN system in the
country and provides the basis to formu-
late and implement an UNDAF. The CCA
also represents a process to bring
together the voices of stakeholders,
experts, and development part-
ners to review and assess the
national development
situation, and within this,
identify the strategic
priorities for the UN
system over the
coming years.
Intended as an objective assessment, it
provides the basis for consensus building
during the UNDAF process.
It is also hoped that the CCA will help
inform the ongoing efforts of the country to
forge a path of more equitable growth and
human development. The next general
election is scheduled for May 2004, with an
incoming Administration set to take office
in July. This timing is particularly impor-
tant, as the current Government’s Medium

9. A Common Country Assessment of the Philippines 9
Term Development Plan (MTPDP), which the key challenge –- is the principle of a
sets out its overall development roadmap rights-based development approach. This
and programme thrusts, will also lapse at means putting poor and vulnerable groups at
that time. Preparations for the next MTPDP the core of the development agenda while
are already under way. Clearly, the actions strengthening the accountability of the state
of the next Administration will directly affect and other duty-bearers to citizens and
the ability of the Philippines to meet the families, including the provision of mecha-
challenges agreed to in the UN Millennium nisms for access, participation, and redress.
Declaration. The Philippine government is Full compliance with the commitments
the most significant duty-bearer in the contained in the international conventions
protection, promotion, and fulfillment of signed and ratified by the Philippines will go
human rights in the country. a long way to promote a greater respect for
the rights of all (Tables
SCOPE OF 2, 3, 4, pp.93-95).
THE CCA The first Philip-
The overarching pines Progress
framework of the CCA Report on the MDGs
is the Millennium (MDGR) was issued
Declaration. The by the Philippine
Millennium Declaration, Government in close
adopted in 2000 by 189 collaboration with the
countries including the UN Country Team
Philippines, sets out (UNCT) in January
key development 2003. The report
challenges facing humanity, articulates a asserts a high probability of meeting the
response to these challenges, and outlines goals and targets related to eradicating
concrete measures for gauging perfor- extreme poverty, improving access to clean
mance. In addition to committing to eight water, universal access to primary education,
specific, time-bound goals, or Millennium gender equality, reducing child mortality and
Development Goals (MDGs), in the areas of halting HIV/AIDS. On the other hand, it
health, education, environment, governance, projects a medium probability of attaining the
and a global partnership for development targets on maternal health care, and only a
(Table 1, p.92), the Declaration pays special low probability of achieving the targets on
heed to the responsibility of all nations to hunger (malnutrition). The methodology
protect the vulnerable, and in particular used to estimate these probabilities consid-
children and civilian populations that suffer ered the difference between the rate of
disproportionately from the consequences of annual change needed and the current
natural disasters, genocide, armed conflicts, annual rate of progress. Clearly, the rate of
and other humanitarian emergencies. change to date is inadequate.
Underlining the significance of the MDGs, Another report, which in fact predated the
Philippine President Arroyo affirmed that “the MDGR, assesses the resource require-
MDGs provide a standard for governance by ments necessary to attain the MDGs in the
which the people and the international specified timeframe. This report, the “Philip-
community can judge the ability to provide a pines Country Study on Meeting the Millen-
life with dignity for all Filipinos, especially the nium Development Goals,” commissioned
poor.”1 So far, the capacity and will of the by the UNDP in advance of the 2002
country to make the necessary improve- Monterrey International Conference on
ments is already the subject of concerted Financing for Development, paints a much
attention. less optimistic picture than the MDGR. The
In addition to focusing specifically on the report concludes that the Philippines will not
MDGs, the CCA also seeks to illuminate how succeed in reaching any of the MDGs unless
development strategies affect marginalised major shifts are achieved in economic
groups in society (Figure 1, p.103). At the expansion and population growth rates, and
heart of this aspiration –- and representing unless government resources for social

10. 10 A Common View, A Common Journey
services are increased significantly and used opment challenges, within their mandates.
more effectively. The assessment comes to To make their initial assessment, UNDP
this worrisome conclusion even when the used the Early Warning and Preventive
optimistic forecasts contained in the MTPDP Measures Composite Analysis where the
(2001-2004), as regards population and “nugget” or intersecting root causes of the
economic growth, are assumed. Already, the various issues per area, ie. economic,
country has fallen short of its MTPDP targets political, social and external, were identified.
for both GDP and population growth. UNFPA, on the other hand, used the causal-
Finally, the CCA sketches out the elements ity tree analysis, analyzed the linkages of
for a roadmap for development cooperation. issues by clustering or assessing reinforc-
In doing so, the CCA highlights key obstacles ing/balancing loops, and identified the
that stand in the way of full realisation of the strengths, weaknesses, opportunities and
MDGs, especially as regards the poor and threats (SWOT) both of the UN and the
marginalised, and the urgency of acting now. stakeholders that would facilitate or hinder
The intent is not to dwell on negative sce- achievement of development goals. Both
narios or to point the finger at any one duty- UNDP and UNFPA tried to also build various
bearer. Instead, the objective is to identify development scenarios from their analysis.
real vulnerabilities and, in so doing, identify The development challenges identified at
major opportunities for the Philippines today these workshops constituted the basis for
to move its development forward. discussion at a stakeholders’ workshop with
NEDA and other partners on 19-20 June
THE CCA PROCESS 2003. More than one hundred participants
Work on the CCA began in earnest in from sixty organizations representing UN
May 2002, with the agreement by the UNCT agencies, other international funding agen-
on the broad scope of the exercise, terms of cies, government agencies and NGOs/
reference of a CCA inter-agency Core Group CSOs participated in a day and a half
and a process framework for making the consensus-building exercise on the priority
analysis of the development situation. From development problems in the country. More
this, six theme groups were formed to in-depth analysis of these development
consider key development issues facing the challenges was conducted by each work-
Philippines, within the context of MDGs and shop group. Each group prepared a “causal-
other international commitments, namely: (i) ity tree” for the priority problems, analyzed
income-poverty, employment and population the linkages among these development
(MDG 1); (ii) health and nutrition (MDG challenges and made a SWOT analysis to
1,4,5,6); (iii) education and early childhood identify the comparative advantages of the
care and development (MDG 2); (iii) envi- UN to address these challenges. Subse-
ronment (MDG 7); (iv) peace, justice, human quently, consolidation and priority-setting
security and protection (MD Chapter VI); and efforts were undertaken by the CCA Core
(v) governance and partnerships in develop- and Theme Groups, in close consultation
ment (MDG 8). These theme groups were with the programme staff of the UN agen-
composed of representatives from UN agen- cies, NEDA, and selected major partner
cies, academia, CSOs and the public sectors. agencies. Assessment reports were pre-
The assessment process involved sented in a plenary workshop held on 8
extensive research, analysis, and consulta- August 2003.
tion. Preparatory activities involved a review Drafting of the CCA was undertaken with
of existing assessment reports, studies and the assistance of selected consultants. The
programme documents available within the UNCT, supported by the CCA Core Group
UN and from the government and other and the lead Theme Group conveners,
donor agencies - these reports included, played an active role in guiding and review-
among others, the UN gender assessment ing the drafts of the CCA. Draft documents
study2 and the Progress Report on the were submitted to the Regional Support
MDGs. In-house workshops were then Group in Bangkok and the National Advisory
conducted at UNDP, UNICEF and UNFPA, to Group for further refinement. A final CCA
produce an initial assessment of the devel- document was approved in March 2004.

11. A Common Country Assessment of the Philippines 11
METHODOLOGICAL cies are doing their own estimates, the
CHALLENGES methodology for estimation varies and may
The limited and uneven availability of not be representative. For example, to a
timely and disaggregated data was a major large extent only those abused women and
obstacle. To assist in presenting consistent children affected by conflict who seek the
data, the UNCT relied primarily on official services of the Department of Social Wel-
(government) statistics, supplemented by fare are counted. As we move forward,
data from nongovernment sources where baseline data will need to be established, in
appropriate and available. The reason for this order to properly monitor trends.
emphasis was twofold. First, official statis- National Surveys are normally limited to
tics, used to monitor the condition of the regional and provincial level statistics. While
country by almost all agencies, were col- census statistics reach down to barangay
lected through statistically-sound methodolo- level3, the data is limited to basic demographic
gies of data collection and estimation and statistics only. Hence, some Local Govern-
(with notable exceptions) are relatively ment Units conduct surveys at the barangay
current. Second, the process of building the level just to obtain information about their own
CCA matrices of indicators facilitated impor- localities, e.g. Community-Based Information
tant discussions with key agencies about System (CBIS). However, there is often an
how gaps in data collection and reliability absence of technical know-how in these
could be improved. By the time of the next communities, resulting in data inaccuracies.
CCA, it is hoped that many of these gaps will 3. Normally long delays between the
begin to be addressed. Notable gaps include: conduct of a survey and data processing,
1. Long intervals between data collec- adding to the delays in reporting and reducing
tion, including: its relevance to policy makers: Education
a. Functional Literacy (normally every five participation and cohort survival rates, for
years, but the most recent collection interval example, are among the victims of such
was eight years i.e. 1994 and 2003, respec- delays.
tively. Lowest disaggregation is at the prov- 4. Reliability of provincial estimates:
ince level). Many provinces do not have enough
b. Data on Mortality and other demo- samples to produce reliable poverty esti-
graphic data (normally every five years, the mates. For example, among the statistics
latest was in 2003). Funding support was collected in the ten poorest provinces, three
provided by USAID with a small contribution have a coefficient of variation greater than
from the government. Lowest disaggrega- 104. However, reliability problems also
tion level is regional. It would be very costly occur at the national level, such as in the
to further disaggregate as it would require case of maternal mortality rates.
additional sample households. 5. Inaccessibility of the data: Some data
c. Income data (from Family Income and are not accessible to researchers. Not all
Expenditure Survey to measure poverty government agencies offer a central deposi-
every three years). Annual income data are tory of data. Or, if there are libraries, the data
not available, again, due to budgetary con- in the libraries are not kept up-to-date. The
straints. However, data on social statistics researcher will have to go to the concerned
and rough estimates of income are gathered division in-charge of the data to research
yearly through the Annual Poverty Indicator unpublished and unsourced printouts. This
Survey. In the latter survey, however, pov- explains why many of the references in this
erty incidence and related statistics cannot CCA simply refer to the bureau providing the
be derived. The lowest level of disaggrega- data.
tion is provincial. 6. Inconsistency between survey data and
2. The difficulty of identifying the where- administrative-based data: Some statistics
abouts and profiles of key target groups, have several sources. However, in most
including abused women, disabled persons, cases the figures vary. An example of such
Indigenous Peoples, and displaced persons: an inconsistency relates to access to safe
A special sampling design is required to water provided by both the Department of
capture these groups. While certain agen- Health and by the National Statistics Office.

12. 12 A Common View, A Common Journey
In retrospect, a more thorough investiga-
tion of alternative sources of data as a
supplement to official statistics would have
enhanced the discussion about the status of
development issues, brought to clearer light
the severity of development challenges in
poor regions and facing vulnerable groups,
and revealed additional deficiencies in
monitoring mechanisms. Exposing differ-
ences in reported indices may have also
generated constructive debate among
stakeholders and with the UNCT about the
extent of development challenges in the
country. Regardless, what clearly emerged
is a need to develop surveillance mecha-
nisms that illuminate successes and failures
in identifying and reaching marginalised
groups across the country and that track
how the various duty-bearers are contribut-
ing to such trends. The success of develop-
ment programmes should be measured,
fundamentally, by how they reach and
empower the most disadvantaged.
DOCUMENT ORGANISATION
This CCA is organised as follows: Sec-
tion One (above) has outlined its objectives
and scope, summarised the process of its
development, and highlighted key method-
ological challenges. Section Two provides
an overview of poverty and vulnerability in
the Philippines, and discusses their underly-
ing causes. Section Three highlights the
major development challenges facing the
Philippines, viewed particularly through the
SECTION 2:
prism of the priorities set by the Millennium
Declaration. Section Four sets out a frame-
work for moving forward and underlines the
Defining the
urgency of making demonstrable progress.
Finally, Section Five presents a three-part COUNTRY PROFILE IN BRIEF
indicator framework that can be used to The development challenges of the
monitor progress on selected development Philippines are considerable and they are
indicators over the coming years. pressing. The country has a land area of
about 300,000 square kilometers, spread
over 7,000 islands - many communities
are remote. The quality of transportation
and communication systems is uneven
throughout the country, cutting off many
communities from goods and basic ser-
vices. The population (in 2003) of 82
million is growing at one of the highest
rates in the world — by roughly 25%
during the last decade of the 20th century
— and is expected to reach 108.5 million

13. A Common Country Assessment of the Philippines 13
Development Challenge
by 2015 –- the target date to reach many DEFINING POVERTY AND
of the MDGs. The fertility rate is 3.5 VULNERABILITY
children per woman, well above many The face of poverty in the Philippines is
countries in Asia. With the urban popula- manifested in chronic deprivation in many
tion growing at a rate of 28.8% (between rural and urban areas and the ubiquitous
1990-2000) already close to half of the presence of pockets of slums in urban
population now live in urban centers, areas5. Many others experience transient
primarily in coastal areas. This trend is poverty, not persistently poor, but highly
expected to persist. Environmental degra- vulnerable even in the best of times6.
dation has reached critical levels. The UN concept of poverty is rooted in
Given the Philippines’ rich multilinguistic, a state of powerlessness and not merely
multiethnic, and geographically dispersed the absence of assets and services to
population, a nuanced picture of its diversity meet basic needs. Vulnerability, as distin-
is necessary to promote, and progressively guished from poverty, refers to the debili-
achieve, the rights of each citizen. tating effect of major obstacles to the

14. 14 A Common View, A Common Journey
fulfillment of one’s human rights and Rural Poor:
commonly refers to the disadvantaged and Poverty in rural areas is pervasive and
oppressed. There are varying degrees of persistent. Roughly two-thirds of the entire
vulnerability within and among distinct population of Filipino poor reside in rural
groups. Together with those Filipinos areas– indeed, four of 10 rural families are
living in poverty, the vulnerable must also poor. The rural poor consist mostly of small
be placed at the center of development and landless farmers, farm workers,
efforts. The Millennium Declaration com- fisherfolk, and Indigenous Persons.11 The
mitted to improving the lives of both the strong ties of the rural poor to the environ-
poor and the vulnerable.7 ment increase their vulnerability to erratic
weather patterns and
Income Poverty: natural occurrences.
Lowering the The inability to own
incidence of poverty the land on which
has been a stated top they work discour-
priority of national ages diversification
development efforts into new, higher-
from the 1980s up to value crops. Unequal
the present. Income access to ownership
poverty8 was signifi- of resources also
cantly reduced in the discourages sustain-
decade preceding the able practices.
Asian financial crisis Household bud-
which slowed down gets of the rural poor
economic growth and tend to be already
increased unemploy- stretched. As in-
ment in the region. After this point, poverty come decreases, demand for health ser-
incidence in the Philippines rose from vices — that may be some distance away
28.1% in 1997 to 28.4% in 2000.9 In other — declines and the perceived opportunity
words, 4.3 million families or 26.5 million costs of keeping children in school rise.
Filipinos are living below the poverty line, Fragmented policies and under-funded
2.5 million persons more than in 1997. government programmes have largely failed
The incidence of families living at a sub- to deliver on stated intent to increase ac-
sistence level has declined, but there cess to basic services, raise agricultural
were still 2 million food-poor families, in productivity, ensure technical improvements,
the year 2000. diversify rural incomes, and build the
Certain regions face the gravest capacity of local government units to
conditions. The four provinces of the develop vibrant rural communities. This
Autonomous Region of Muslim Mindanao failure is in part attributable to: (i) graft and
(ARMM) are among the 10 poorest prov- corruption; (ii) political instability at the LGU
inces (Table 5, p.95), making the region the level leading to sporadic programming; and
poorest in the country (Table 6, p.96). Ifugao (iii) a lack of trust in government leading to
province of the Cordillera Autonomous nonacceptance of programs by the in-
Region on Luzon, home to one of the tended beneficiaries.
largest Indigenous Persons populations,
is also among those provinces with Urban Poor:
severe poverty. 10 Communities in these The high incidence of urban poverty at
two regions are particularly isolated and 15 percent12 is a spillover effect of destitu-
under-serviced, live amid uncertainty and tion in rural areas, as many migrate in the
conflict (although the nature and scale of hopes of finding better opportunities in the
the conflict are not comparable across cities. The fast rate of urbanisation has
these regions), and benefit from little produced new problems for the urban poor,
investment in economic or social infra- including underemployment and unemploy-
structure. ment, poor housing, lack of basic services,

15. A Common Country Assessment of the Philippines 15
and enormous pressures on urban carrying
capacities, particularly solid waste man-
agement, and air and water pollution.
Some 262,000 informal settlements are
situated in what may be considered high-
risk or danger areas—riverbanks, railroad
tracks, shorelines, dumpsites, low-lying
areas susceptible to flooding, under
bridges, relocation sites lacking amenities
and tenurial security, and areas under
threat of eviction.13
Improving the performance of urban
areas in terms of poverty reduction, as
engines of economic development, and as Child Labour:
attractive living environments, is a major The incidence of child labour in the Philip-
challenge. Many of the urban poor earn a pines is pervasive and alarming. In 2001, an
meager living in the informal services estimated four million Filipino children, aged
sector. The right to secure tenure, or the 5-17, were economically active, or 16.2
right to feel safe in one’s home, the right to percent of the total for this age group (Figure 2,
control one’s own housing environment and p.104). About 60 percent are exposed to
the right to a process of eviction or dis- hazardous and exploitative working condi-
placement mitigation, forms the core tions such as in mining and quarrying, pyro-
element of the urban poor’s advocacy for technics, construction and deep-sea fishing.
social inclusion in the cities.14 There is the Over 37 percent of working children, or about
absence of an integrated urban develop- 1.5 million, work as long as five to eight hours
ment strategy to guide planners, a day, leaving no time for schooling and
policymakers and other stakeholders in recreation.
addressing complex housing and urban Between 60,000 and 100,000 children
development issues. Most often, these nationwide are victims of commercial sexual
policy frameworks tend to address symp- exploitation.16 Data show that children
toms rather than causes of urban prob- trapped in commercial sexual exploitation
lems. Sustainable urbanisation is a pro- are concentrated in tourist destinations such
cess and a long-term vision for the Philip- as Regions 1, 3, 4, 8 and the NCR. Sexually
pine urban system, but requires a net- exploited children suffer from trauma and
worked and decentralised approach that are highly vulnerable to substance abuse,
harnesses bottom-up and top-down forces physical violence, STIs and HIV/AIDS.
from government, the private and the civil The causes of child labor are complex
sectors.15 and interrelated, but fundamentally they
derive from poverty. In addition, barriers to
education, weak labor markets, and lack of
employment opportunities for household
members also increase the propensity of
children to work. Beliefs and practices that
tolerate abuse and exploitation are also
harmful. Unethical business practices
persist, without which demand-side forces
would be lessened. The elimination of child
labor, particularly in its most hasardous
forms, is the subject of concerted efforts by
government and its partners in the private
sector and flow directly from the country’s
ratification of the ILO Convention on the
Prohibition and Immediate Elimination of the
Worst Forms of Child Labour, (No. 182).

16. 16 A Common View, A Common Journey
Children Caught in Armed Conflict: with adult offenders and therefore have been
There is an increasing trend in the num- conditioned to criminal behavior. Many jails
ber of children involved in armed conflict in and prisons are congested and are main-
different parts of the country. The Office of tained in subhuman conditions, with inad-
the Presidential Adviser on the Peace equate living spaces, poor sanitation facili-
Process17, for example, reports that the Abu ties, and low quality food. The weak capac-
Sayyaf Group has used children as combat- ity of parole, probation and corrections
ants in its operations against the Armed officers is also evident in the practice of a
Forces of the Philippines. Evidence also punitive rather than a corrective and rehabili-
shows that the New People’s Army and the tative jail system, thereby increasing the
Moro Islamic Liberation Front have been legal insecurity of disadvantaged groups.
recruiting children to become combatants, The UN Committee on the Rights of the
cooks, medics and messengers. Thus, Child expressed concern about the Philip-
children become victims of the armed pines’ administration of juvenile justice and
conflict twice over: by being deprived of its lack of compatibility with the principles
human needs, security and rights (including and provisions set out by the Convention on
the psycho-social impact, displacement, the Rights of the Child and other interna-
and effects of landmines), and by being tional standards relating to juvenile justice.
forced to become child-soldiers. The AFP Current efforts to rectify these deficiencies
estimated in 2002 that children involved in are encouraging.
armed conflict account for 13 percent of the
total rebel population. In response to this
situation, the government put in place a
Comprehensive Programme Framework for
Children in Armed Conflict in November
2001. Soldiering by children is one of the
worst forms of child labor.
Children without Primary Caregivers:
Children without primary caregivers are
deprived of their first source of protection
and are either orphaned, forced away from
their families, or have to leave in search of
income-generating opportunities.
A study commissioned by UNICEF and
the National Programme on Street Children
reported 246,011 street children in the
Philippines.18 This number includes about Abused / Trafficked Women:
45,000-50,000 highly visible street children The difficulty of calculating accurate
in the major cities and urban centers of the estimates of domestic violence is common
country. The hazards and risks faced by among all societies, and the Philippines is
these street children include prolonged no different. Even when victims are in near-
separation from their families, exposure to death situations or brought to hospitals after
drugs, prostitution, early pregnancies, STIs assaults, the abused women face the risk of
and HIV/AIDS. With neither access to basic more violence, public ridicule and economic
services nor better opportunities, their powerlessness.19 Of the 6,074 women in
futures remain bleak. especially difficult situations, served by the
This group also includes children caught Department of Social Welfare and Develop-
up in the judicial system. In 2001, the ment in 2001, 38.2 percent were physically
Bureau of Jail Management and Penology abused, battered and/or maltreated, 13.4
reported 5,905 children in such circum- percent were trafficked, while 11.6 percent
stances, the majority of whom had been were sexually abused. The number of adult
subjected to pretrial detention. While in women in prostitution is estimated at
detention, these children have been mingling 400,000-500,000.20

17. A Common Country Assessment of the Philippines 17
Displaced Persons: cause of their low educational status and
A variety of reasons, including natural unique social and cultural norms, they have
disasters and development projects, have been subjected to historical discrimination
caused displacement in the Philippines. and exploitation. Malaria prevention and
Of particular concern, and the focus of the treatment is also sporadic in IP communi-
May-June 2002 visit of the Special Rappor- ties. Notwithstanding the weight that many
teur on the human rights of migrants, is the Indigenous Peoples attach to securing
forced displacement in Mindanao resulting protection for ancestral lands, progress to
from armed conflict between the Moro this end has been disappointing.
Islamic Liberation Front (MILF) and the Many IP children and youth are caught
Armed Forces of the Philippines. At the in armed conflict and get recruited into
peak of the conflict (2000-2001), an esti- armed rebel groups. The plight of women
mated 932,000 people, half of whom were in situations of armed conflict renders them
children and young people, were displaced. vulnerable to physical abuse. These
While many have returned to their homes, specific groups are subjected to varying
deep concerns persist about the conditions degrees and forms of abuse, violence and
to which they return, their ability to reclaim exploitation, or to multiple vulnerabilities,
land and assets, and the status of those and are among the most marginalised.
who are still displaced. Over 6,400 homes
were totally destroyed; the displaced found Migrant Workers:
shelter in 276 evacuation centers, and Overseas Filipino Workers (OFWs)
among relatives outside the path of conflict. increasingly comprise women and vulner-
As of 23 July 2003, a total of 32, 414 fami- able young persons, who move overseas in
lies or 157, 043 individuals remain dis- search of higher wages or better opportuni-
placed. Some continue to be housed in ties than at home. Based on the results of
101 evacuation centers in 170 barangays in the Survey of Overseas Filipinos conducted
the 10 provinces of Central Mindanao and by the NSO, the number of OFWs in 2001
the ARMM.21 This pattern of displacement and 2002 was estimated at 1.029 million
has been a continuing experience over and 1.056 million, respectively. These
decades of armed conflict. From the figures represent just over 2 percent of
records of the Department of Social Wel- the total population of the country, 15
fare and Development (November 2001), years old and over.
the most significant displacements were Currently, women comprise nearly half
recorded in Maguindanao, Sulu, Lanao del of all OFWs, and their ranks are further
Norte, North Cotabato and Marawi City. In increasing as women account for roughly
August 2001, the total cost of assistance 50 percent of workers going abroad each
for evacuees was PhP342M in the form of year. Around 10 percent of the total num-
relief supplies, bunkhouses, core shelters ber of overseas workers belong to the 10-
and evacuation centers. More than 81, 711 14 age category and two out of every
families or 411,849 persons were displaced three overseas workers in this age cat-
beginning January 2003 by the escalation egory were girls.23 While both women and
of armed hostilities between the AFP and men, as migrant workers, are vulnerable
the MILF. to HIV/STI diseases and exploitation, the
types of jobs that many women take,
Indigenous Peoples: such as domestic work and entertain-
About 140 indigenous ethno-linguistic ment, make them particularly vulnerable
groups, representing 15-20 percent of the to isolation and sexual harassment and
total population22, are found in more than 50 abuse. Once overseas, these workers,
of the country’s 78 provinces (Figure 3, who send home substantial remittances,
p.105). They are mostly located in remote may be discouraged by their families and
but resource-rich areas, many in protected communities from repatriation. If they do
and ecologically fragile environments. return, their reintegration is often rocky,
Because of their remote location, they have as they face difficulties securing decent
poor access to basic services; and be- work opportunities.

18. 18 A Common View, A Common Journey
UNDERLYING CAUSES OF
POVERTY AND
VULNERABILITY
The underlying causes of poverty and
vulnerability are complex and reflect deep-
rooted cultural and institutional dynamics,
embedded in decades if not centuries of
tradition. But as we assess the development
challenges of the Philippines today, and
consider why the poor remain poor and the
vulnerable become increasingly so, a num-
ber of explanations arise about why the
Philippines has not realised widespread
improvements to human development and
security. These explanations relate to three
broad themes: economic growth and the
underlying structural inequities and founda-
tions in the economy; a sense of insecurity
relating to societal harmony and political
uncertainty; and the failure to iron out many
of the imbalances and inequities that prevent
key agents of change — including women,
the poor and the marginalised — from
playing more active roles in improving their
lives and those of others. While the Govern-
ment of the Philippines and development
partners have devoted considerable effort
and funding to improve the level of develop- the fiscal deficit and debt burden remain
ment of the country, this assessment fo- substantial, and markets remain vulnerable
cuses on what more needs to be accom- to political and investor uncertainty. In
plished. general, low investment reflects weak
investor confidence explained by a number
Growth has been poor and not “pro-poor”: of internal factors, among others: (a) the
The growth of the Philippine economy instabilities in the political situation and
has not been strong enough or equitable peace and order problems; (b) the fiscal
enough to contribute to a reduction in poverty. imbalance, banking and financial market
Even during periods of somewhat steady uncertainties; (c) institutional and gover-
growth, growth has been modest. Both nance issues such as are reflected in the
external and internal factors are behind this. low international rating of the Philippines for
The Philippine economy has fallen victim the rule of law, including the enforcement of
to a number of regional and global develop- contracts; (d) inadequate infrastructure and
ments. The Asian financial crisis, the US- (e) the high cost of engaging in business in
led war in Iraq, global retrenchment in the the country.24 All of these contribute to a
high- technology and electronics sectors, and broad perception by domestic investors that
the El Niño phenomenon have hampered opportunities abroad are relatively more
global demand, strained domestic production, attractive. That the Philippines runs an
and created greater investor unease in the external account surplus — which reflects
country and region as a whole. Economic the fact that national savings exceeds
policy reforms and programming imple- national investments — is in part an illus-
mented over the past few years have been tration of this. Indeed, investment in the
credited with generating the modest growth Philippines is among the lowest in South-
levels posted and for preventing even more east Asia, at around 20 percent of the GDP,
citizens from falling into poverty. compared to a norm of 30-35 percent for
However, the economy remains fragile, other newly industrialised countries.

19. A Common Country Assessment of the Philippines 19
That said, there is a clear need to im- policy thrust aimed at addressing conten-
prove productivity, diversify beyond national tious issues such as the high concentration
resource-intensive products, increase of wealth among a few select families or the
domestic value-added, and build the com- related issue of land reform. The inequitable
petitiveness necessary to access wider distribution of productive resources has led
markets. The industry sector, for example, to alarming disparities in economic status
has failed to expand into a source of high- across populations, no matter the level of
income, high-productivity employment. growth. This inequity appears to be widen-
Moreover, this sector, which contributes ing. The Gini ratio26 in 2000 was 0.48 –-
more than 20 percent of the value-added in notably higher in 1985, when the ratio was
the country, generates as little of half that 0.44 (the closer the ratio is to 1.0, the
amount in employment opportunities.25 greater is income inequity). Indeed, during
Whereas large firms dominate the less this same time period (1985 and 2000), the
labor-intensive manufacturing and export share in national income of the poorest 20
sectors, micro and small enterprises — percent of the population declined from 4.8
many of which are active in the informal percent to 4.4 percent, while the share of the
sector — absorb the most labor. Medium- richest 20 percent increased from 52.1
sized enterprises, representing the bridge percent to 54.8 percent. A study showed
between small and large enterprises, are that had income distribution been the same
underdeveloped and few and far between. as the 1985 level, poverty incidence would
Investments in human capital –- through have declined by as much as 16.5 percent-
access to quality and relevant vocational age points, instead of the net decline of 9.4
education and higher education and through percentage points that was actually
life-long learning of the labor force —have achieved over the period.27
been inconsistent. Innovation, a driver of At the individual level, the inability to break
technological capacity and industrial devel- the cycle of poverty is largely a result of
opment, has not been successfully nurtured these disparities and inequalities in access-
in the country. ing the resources and benefits of develop-
ment and the lack of accountability placed
Inequities in Access to Opportunities on duty-bearers. Issues relating to inequali-
and Basic Services: ties in accessing productive assets and
Since the restoration of democracy in basic social services were examined: the
1986, the number of civil society groups and varying levels of resource development (i.e.
peoples’ organisations has grown consider- human, physical, natural resources); and
ably. With the power of modern communi- the presence of physical and social barriers
cations, civil society has become a formi- to participation in development initiatives,
dable influence, as manifested in popular among others. It was unanimously con-
uprisings better known as ‘People Power.’ cluded that this factor is greatly undermining
Moreover, the government has established rights-based development in the country.
venues for people’s participation in gover- Farmers have little ability to accelerate land
nance, such as sectoral representatives reform against long-standing powerful
through the party-list system, and as mem- landlords. Indigenous peoples, who are
bers of national and local special bodies, seeking to protect ancestral lands from
technical working groups, and project task mining, deforestation, or other development,
forces and has encouraged the participation have little power to serve as a counterweight
of Civil Society Organisations (CSOs) and to the influences of large, often corporate,
the organised basic sectors to engage in interests, who seek the interpretation of
policymaking and planning. The Philippines conflicting national laws in their favor. With-
benefits from a vigorous free press leading out such shifts in power dynamics, and the
to vigorous public discussions. more effective “voice” that this would bring,
Notwithstanding the tremendous the marginalised will remain so. Inevitably,
progress towards meaningful engagement when there is inconsistency and conflict in
of civil society, the democratic process has various laws, the larger entities (local or
not produced a strong unified consensus or foreign) have greater room for maneuver.

20. 20 A Common View, A Common Journey
Poor Quality and Inefficient Distribution
of Economic Infrastructure:
The Philippines has pressed ahead with
important reforms to improve the availability
and adequacy of infrastructure. The enact-
ment of the Build-Operate-Transfer law,
telecommunications liberalization, and
deregulation of the domestic transportation
industry, for example, were important steps
taken.28 The Philippines telecommunica-
tions sector is recognised as being one of
the most advanced in the region. During the
1997 Asian financial crisis, the strength of
the economy lay in the construction sector
that rose 16.2 percent, while the transporta-
tion, communication, and storage sector
grew by 8.2 percent.
However, poor quality of infrastructure
and support facilities, the slow adoption of
advanced technology, and the low level of
research and development contribute to low
productivity and competitiveness29 and
prevent SMEs from engaging more in inter- investment liberalisation improves access to
island and international trade. Indeed, the pollution-control technology and cleaner
2002 World Competitiveness Yearbook30 energy inputs. The Doha Round of negotia-
ranked the Philippines as 30th among large tions under the World Trade Organisation,
countries31 on the question of basic infra- for example, has the potential to yield many
structure –- including in the road, rail, mari- benefits to Filipinos and the Philippine
time, and aviation sectors. Electricity costs economy more generally. If new disciplines
are high, and there are growing concerns in the trade of agricultural goods result in
about the country’s capacity to supply dramatic reductions in trade-distorting
adequate power a few years hence. Though subsidies, quantitative import restrictions,
further reforms to regulation and competition and tariff levels in OECD countries, Filipino
policy affecting this sector are encouraging, agricultural producers and processors could
financial investments are also required. In become more internationally competitive.
this regard, the World Bank estimates that According to a World Bank report33, agricul-
the Philippines would have required between tural subsidies in rich countries, which
$38B and $48B to meet its investment currently stand at $350 billion, is roughly
requirements in infrastructure during the 10- seven times the amount spent on interna-
year period ending 200432. Remote com- tional aid. Similarly, clearer disciplines
munities in mountainous provinces and relating to Trade-Related Intellectual Prop-
distant islands have benefited the least from erty (TRIPs) are on the table as are disci-
infrastructural development. plines relating to the trade in services.
Such changes to the multilateral trading
Trade Liberalisation: system could help the Philippines promote
The latest trends toward globalisation are efficiency in resource allocation, enhance
viewed with both optimism and concern — consumer welfare, expand international
a sentiment underscored in the Millennium market access for Philippine agricultural
Declaration. Clearly, liberalisation can goods, stimulate the “backroom” services
support democratic principles, facilitate the sector, and open up the market for more
transfer of new technology and technological affordable prescription drugs, to name a few
innovation, and attract much-needed invest- benefits. Many of these benefits, however,
ment that domestic capital markets are are not solely dependent on multilateral
unable to generate. Similarly, trade and action. By continuing selective liberalisation

21. A Common Country Assessment of the Philippines 21
efforts, including in the agricultural sector, Fertility Rates:
where tariffs in the Philippines remain High fertility rates reflect a lack of access
relatively high within the region, the consum- to, and demand for, family planning services,
ers and producers alike could realise con- lower educational attainment, and poverty.
siderable gains. The unmet demand for family planning
However, freer trade will benefit only services is evidenced by a total fertility rate of
those producers who can compete and in 3.5 children per woman. This is, on average,
those sectors where the Philippines has a one child higher than the number reportedly
comparative advantage. In this way, the preferred by Filipino women.35 Government
growth of international trade and investment policy is based on responsible parenthood
has sharpened development challenges. and family planning. Muslim religious leaders
Many businesses and supporting institutions in the country have recently issued a
are ill-prepared for the intensified competi- “fatwah” or decree declaring Islam’s support
tion it brings, in part due to past restrictive for reproductive health and family planning.
policies and in part because of overall The population
competitiveness. In the Philippines, un- growth rate of the
skilled labor has been rendered redundant Philippines has
by less expensive labor abroad and through serious conse-
automation or mechanisation of production quences at every level
processes. Machinery, rural feeder roads, of the development
and post-harvest facilities are outdated or challenge. At the
inadequate in many parts of the country, national level, high
leaving the prospects for many commodity population growth
producers discouraging. rates express them-
Consequently, unless considerable selves in discouraging
strides are made to attract capital and levels of per capita GNP. The country’s
technology to combine with domestic labor, population growth, at 2.36% (average annual
the unskilled workforce will continue to be growth rate from 1995 to 2000), is one of the
marginalised into subsistence activities world’s highest, almost twice the global rate of
(including self-employment and micro 1.3 percent. With population growing at this
business in the informal economy) and rate, the growth of output per capita averaged
dependency on imports (including food only 1.4 percent from 1980-2000. Given the
imports) will intensify. Better social protec- rate of GDP over the last three decades, it is
tion measures must go hand in hand with estimated that per capita GDP would have
further liberalisation, to increase labor been 50 percent higher than it now stands,
market flexibility and encourage entrepre- had population (in 2003) only grown at the
neurship, innovation, and product diversifica- same rate as Thailand’s, where fertility rate
tion, while catching those who are unable to is 1.8, as against the 3.5 of the Philippines36.
adjust in time. The Committee on the Elimi- A high savings rate — a prerequisite to
nation of Discrimination warned34 that domestic investment — is also undercut by
women are particularly vulnerable to the a high dependency rate.
impact of liberalisation, especially those in At the local level, high fertility rates in-
free-trade zones and in rural areas. crease pressures on the environment,
Owing to weak management of natural escalating harvesting rates of scarce natural
resources and ineffective export controls, resources and compounding problems of air,
the globalisation of demand has also accel- water and land quality, and human and
erated exploitation and destruction of pre- industrial waste disposal. Moreover, the
cious resources, including natural forests gaps between supply and demand for basic
and coral reefs. In the absence of an institu- social services such as education, heath and
tional framework that clarifies tenure and water widen as the ability of government to
thwarts rent-seeking behavior in using the secure additional funding to pay for more
country’s environment and natural re- services is not forthcoming.
sources, this demand will only worsen the At the individual level, high fertility rates
state of the environment. have a demonstrated impact on the health

22. 22 A Common View, A Common Journey
and well-being of children and their mothers. paying positions. The low labor force involve-
Large families, particularly those with low ment of women reflects the greater prefer-
spacing between births, experience higher ence given to the employment of men. For
infant and maternal mortality and morbidity example, only 21 percent of judges in all
and are less likely to see their children attend courts are women, and most of them are in
school. With more children to feed, the the lower courts. The number of women in
incidence of domestic abuse and child labour public office also remains few. Men dominate
increases. Women prefer smaller families posts for local government chief executives
than do men, yet do not have an equal say in and middle-and senior-level ranking career
the decision. officers. Their positions in government and in
the courts directly affect the public policies.
Gender Inequities: Many laws, particularly those dealing with civil
The Philippines has made considerable law (that is, involving spousal and family
progress to advance the status of women. relations) are still biased against women.
Access to schooling for girls is higher than for Quality standards for health care program-
boys, based on cohort survival and repetition ming and delivery have yet to be made fully
rates. Filipino women, particularly those with gender-sensitive. Despite progress, the high
higher education are marrying at a later age, level of maternal mortality is a symptom of
and their acceptance into public service has underinvestment in services for women.
even been higher than men. Women appear However, if gender equality is to be con-
to have gained more from national health sidered there is a need as well to begin
progress, as suggested by life expectancy addressing the emerging problem of boys’
and mortality rates. Two of the last four educational underachievement and to identify
Presidents have been women. strategies that will effectively improve boys’
Building on this foundation, there is still and girls’ participation in schools.
progress to be realised. The potential of At the cultural level, unequal power rela-
women and girls to contribute to development tions between men and women persist,
efforts — as decision-makers, consensus leading to violence against women, a lack of
builders, managers of households, and control over women’s reproductive health
income generators — and their ability to choices, and the inability to pursue meaning-
exercise their rights as equal partners, will ful employment. Behind these power rela-
directly affect the speed of rights-based tions is patriarchy — the social structure is
development. As noted in the Millennium constructed, reinforced and perpetuated by
Declaration, development that is “truly sus- sociopolitical institutions, put in place by men
tainable” depends on making real progress and thereby ensure that men, by virtue of
towards the empowerment of women. their gender, have power and control over
At the institutional level and in the workforce, women and children. Until women and girls
women are under-represented and tend not to are perceived as equal partners, develop-
occupy the higher occupational ranks or best- ment will be hindered.

23. A Common Country Assessment of the Philippines 23
SECTION 3:
Areas of Development
Cooperation
F lowing from the previous discussion of
poverty and vulnerability, this section
attempts to identify a subset of development
GOOD GOVERNANCE
In the Philippines, as elsewhere, gover-
nance is of central importance to delivering
issues that most directly affect the poorest on any and all the MDGs. Since the rein-
and most vulnerable. In particular, the statement of democracy in 1986, there have
criteria for selecting these specific issues been major and welcome reforms in many
are: (a) addressing the issue is seen as a aspects of governance, i.e. political, eco-
necessary catalyst for change and improve- nomic, judicial and administrative. Through
ment in other areas; (b) past successes and its commitment to the eighth MDG in sup-
best practices can be identified; and (c) they port of the global call for “an open, rule-
are critical to the achievement of the MDGs. based, predictable, nondiscriminatory
In addition, the key development issues trading and financial system...both nationally
generally focus on the key areas of compe- and internationally” and in making debts
tence and comparative advantage of the sustainable in the long-term, the Govern-
United Nations system in the Philippines — ment has reiterated its commitment to
in other words, where a critical mass of continue reforms in the areas of trade and
technical expertise, best practices and tariffs and government procurement, and for
global, regional, and local networks provide greater efficiency and effectiveness in public
the groundwork for targeted support to expenditures and financial management.
stakeholders in the country. The recent ratification by the Philippines of

24. 24 A Common View, A Common Journey
the UN Convention against Corruption campaigns in schools and communities.
underscores how seriously many policy Despite these efforts, large-scale and
makers take this issue. petty corruption is pervasive throughout
However, progress in carrying out even various levels of Philippine government. The
approved reforms has been hampered by draft report of the “Consultations on the UN
many factors, including: inadequate budget- Conference on Financing for Development”
ary resources; conflicting interpretation, if cited that out of a total national budget of
not gaps, in the implementing rules and PhP781 billion in 2001, PhP100 billion, or 13
regulations of new laws; consequent pro- percent, was at risk of being lost to corrup-
longed litigation to resolve disputes in legal tion; 70 percent involved public works
interpretations; inadequate capacities or contracts while 30 percent involved the
resistance within the bureaucracy to imple- purchase of supplies and equipment.37 The
ment reforms and modernise its systems; Office of the Ombudsman estimated that a
graft and corruption; intense partisan politics total of USD48 billion was lost to graft and
and political disruptions. In the absence of corruption over the past 20 years, and that
substantial headway to curb graft and only 60 percent of the national budget was
corruption, improve the responsiveness and actually spent on government programmes
effectiveness of all three branches of gov- and projects. Whatever the precise figure,
ernment, enhance resource mobilisation the magnitude is large and the broader
efforts, and optimise public expenditure costs are extremely heavy (Table 7, p.97).
decisions, the MDGs and other development
commitments will not be attained. Weak Fiscal Management:
The Reports on the MDGs cite serious
Corruption: gaps between current funding levels and
Corruption damages the development those required to attain the MDGs.
process in many ways: it undermines social Recognising the impact that the fiscal condi-
confidence in the willingness and capacity of tion (and therefore deficit reduction) has on
public institutions to fulfill their obligations to macroeconomic stability, the government
the people; and it reinforces existing power should continue to give priority to raising
relationships that are themselves typically revenues and improving the efficiency of the
part of the development problem. Losses bureaucracy so that more and better quality
due to corruption deepen poverty as they public service can be delivered.
deprive the disadvantaged sectors of much- Following the onset of the Asian financial
needed programmes and environmental crisis, the government deficit deteriorated
stewardship. Incidences of bribery and graft quickly, mainly due to slippages in revenue
are often front-page news, leading the public collection. The major causes of the decline
to perceive them as the norm rather than the include tax evasion and weakness in the tax
exception in government transactions, structure. Moreover, the private corporate
further reducing the incentive or willingness and banking sectors — major contributors to
to increase taxpayer compliance. the national coffers — were weighed down
The Government has recently introduced by nonperforming assets. Tax revenues, as
affirmative actions toward addressing this a share of GDP, fell from 13.9 percent in
problem such as the passage of the Pro- 2000 to 13.5 percent in 2001. About PhP150
curement Act, the implementation of lifestyle billion is lost to tax evasion, PhP92 billion of
check among government officials, and the which constitutes uncollected income tax.
reactivation of the Inter-Agency Anti-Corrup- In succeeding years, these translated into
tion Committee (IAGCC) to synchronize the higher debt service payments, which along
various anti-corruption initiatives of the with the nonpassage of important tax mea-
national government. National and commu- sures, created a vicious cycle of higher
nity-based civil society organizations have deficit and debt. Recognising the major
also contributed their share by monitoring causes of declining revenue collection, the
government projects, increasing citizen’s government began in 2002 to implement
awareness through investigative reporting in reforms in both the Bureau of Internal Rev-
media, and conducting anti-corruption enue and Bureau of Customs.

25. A Common Country Assessment of the Philippines 25
On the expenditure side, expenditure lution of fund management remains limited.
reduction programs were also put in place, School heads thus often remain unable to
such as the Government Electronic Procure- undertake school-specific improvements,
ment System. The culmination of actions reforms, and innovations.
translated into a deficit that is now P2.1 billion Insufficient public spending and invest-
lower than its program. If legislative propos- ment in the Philippines, the lowest among
als to restructure excise taxes are passed, ASEAN countries, also thwart early child
the Government expects further progress care and development efforts. Resources
towards deficit reduction. Moreover, the at all levels (i.e. family, community, local
passage of the Debt Cap Act is expected to government and national government) are
ease the problem of rising interest payments. inadequate to support family care-giving and
However commendable, the deficit- to direct service delivery to children. In
reduction program has crowded out much- public day care centers, the costs of send-
needed expenditures for basic services and ing children to day care centers are still
derailed the implementation of many priority borne largely by families.39 In the private
reforms which are only partly funded, such sector, the cost of early child care and
as the Comprehensive Agrarian Reform development (ECCD) services is prohibitive
Programme (CARP)38, the Urban Develop- for many families.
ment and Housing Act (UDHA) and the Similarly, the budget for the Department
Clean Air Act, among others. Based on a of Environment and Natural Resources
2001 Social Weather Stations study, real (DENR) declined by roughly 60 percent in real
spending on basic social services by the terms, from 1998-2003; the ratio of allocations
national government steadily dropped from for Personnel Services and Maintenance to
PhP418 million in 1997 to PhP378 million in Operations increased from about 60:40 in
2000. In other words, social services 1990 to approaching 95:5 today.
expenditures as a share of GDP, decreased
from 6.4 percent in 2000 to 6.0 percent in Decentralisation:
2001. This trend is also reflected among Decentralisation was intended to make
Local Government Units (LGUs). government services more accessible and
On a sectoral basis, the National Health local institutions more accountable and
Accounts reveal that the ratio of health transparent and to promote working partner-
expenditures to GNP dropped from 3.4 ships between local governments and their
percent in 1997 to 3.25 percent in 2000, respective constituencies, particularly the
compared to the WHO-recommended poor. After more than a decade of
standard of five percent (Table 8, p.97). Lack of decentralisation, some important gains and
funds also led to insufficient social health breakthroughs have been achieved that
insurance coverage, especially among poor have benefited the disadvantaged sectors at
families, preventing access to timely and the community level. Innovative approaches
quality health and nutrition interventions. and partnership arrangements have been
Comparative statistics also show that the pursued by LGUs, national agencies, the
Philippines spends less per capita for basic private sector, CSOs and communities to
education than neighbors such as Malaysia collectively manage programmes and
and Korea, though more than China (Table enforce policies on the ground. A number of
9, p.98). By category of expenditure, the best practices in local governance were
largest allocation of the basic education recognised in a host of social and economic
budget goes to Personnel Services, i.e. services, in the promotion of justice and in
teachers’ salaries, leaving very little for mainte- peace-building and conflict management.
nance and other operating expenses (MOOE) However, government decentralisation
and Capital Outlay, where funds for enhancing has also created challenges, particularly
education quality (teacher training, instructional pertaining to division of labour and financial
materials, support to school improvements) responsibility. About 90 percent of local
are sourced (Table 10, p.98). Moreover, despite governments continue to depend on the
efforts by the DepED to release resources national government’s Internal Revenue
directly to elementary schools, actual devo- Allotment (IRA) despite the Local Govern-

26. 26 A Common View, A Common Journey
ment Code’s provisions allowing them to Concerns about the Judicial System:
generate resources from local taxes (albeit The role of the Judiciary is vital in main-
limited) and other forms of resource taining the rule of law and in providing an
mobilisation (Table 11, p.99). This depen- enabling environment conducive to develop-
dence weakens their capacities to deliver ment, particularly by ensuring social equity
adequate basic services to their constituen- and empowering the poor and less privi-
cies and increases their vulnerability to leged. The Judiciary has initiated a compre-
political influence from the national level. hensive reform program to transform itself
The poorest regions, whose citizens are in into “an independent, impartial, effective and
greatest need of investments in economic efficient Judiciary, protective of the rights of
and social infrastructure and basic services, the people and democratic institutions.”
also have the fewest revenue-generating Current efforts are directed to address
opportunities. A major challenge is to iden- issues such as access to justice by the
tify innovative ways to share revenue more poor, corruption, case backlogs, competen-
equitably among regions. cies of judges and personnel and fiscal
Recommendations to improve the effec- autonomy, in partnership with the pillars of
tiveness of decentralisation include: (a) justice including civil-society organisations
further and substantial financial and legal professional associations.Many
decentralisation to effectively carry out questions have been raised about the
devolved functions; (b) continued capacity- reliability and competence of the judicial
building for LGUs to manage devolved system in the Philippines, and whether
functions; (c) greater inter-LGU arrange- citizens and foreign investors alike can be
ments and standardisation; (d) serious assured of justice. There have been particu-
attention at the local level to the adverse lar concerns about interventions in specific
effects of urbanisation and the shortage of commercial disputes, contributing to a
basic services; and (e) strengthened ac- climate of unpredictability and uncertainty for
countability and performance measurement investments and private-public partnerships.
systems of local governments to local citi- The Philippine judiciary faces a host of
zens and service users. Individuals and problems in its internal and external environ-
communities have an important role to play ment. Internally, the outdated and highly
by voicing their needs and concerns to local centralised judicial system is constrained by
government officials to ensure they receive a low budget, a lack of fiscal autonomy, low
the goods and services to which they are salaries for judges and court personnel
entitled (Table 12, p.99). (which can lead to corruption), judicial
ineptitude, a tarnished public image, and a
An Inefficient Bureaucracy: weak community relationship.41 Docket
Past Philippine administrations have congestion is a serious problem. Parties of
carried out reorganisation and reengineering the poor, in particular, have to wait years for
schemes for the bureaucracy, in an effort to their disputes to be resolved. The resolution
improve efficiency and reduce corruption. of cases involving reform programmes
Studies about the Philippine civil service (such as land reform) takes particularly long.
system point to several deficiencies that Indeed, the rate of disposition of cases at
include: (a) weak mechanisms for planning, the Department of Agrarian Reform (DAR)
agenda-setting and policymaking; (b) failure takes five times longer than those of regular
to implement and maintain an appropriate courts.42
performance management and measure- There is a dearth of legal practitioners
ment system; (c) overlapping and duplica- vis-à-vis the increasing number of cases,
tive government functions and activities; (d) particularly those involving agrarian conflicts,
overemphasis on rules and procedures labour-management disputes, urban poor
rather than direct resource management community evictions or IP community
towards the realisation of intended out- displacement. Legal professionals in gov-
comes and impacts; (e) a highly politicised ernment earn meager salaries compared to
bureaucracy, and (f) lack of required mana- lawyers in private practice, a primary ob-
gerial and technical competencies.40 stacle to recruiting new lawyers.43 Citizens