Poverty and hunger are dynamic

Like in 2011, hunger and poverty happened to move in opposite directions over two successive quarters.  Two weeks ago, the BusinessWorld headline was “Fewer families go hungry” (1/7/13); this week BW said “More Filipino families view themselves as poor” (1/14/13).  These reports were based on comparisons of the latest two SWS surveys, showing a drop in hunger by almost 5 points, and a rise in poverty by 7 points, over the third and fourth quarters of 2012.

Like in 2011, there is no inconsistency in the movements, since the relation of hunger to poverty is dynamic, varying from quarter to quarter. I wrote on this a year ago, in “Poverty and hunger are different” (Inquirer, 2/4/12), to discuss how it happened that hunger rose, while poverty fell, between the third and fourth quarters of 2011. In that period, the rise in hunger was by 1 point, and the fall in poverty was by 7 points.

Quarter to quarter. Among poor families in particular, the hunger rate fell from 30.6 percent in 2012 Q3 to 22.7 percent in 2012 Q4.  Among non-poor families, the hunger rate also fell, from 11.6 percent in 2012 Q3 to 9.0 in 2012 Q4.

Hunger among the poor, compared to the non-poor, was almost three times as prevalent (30.6/11.6) in 2012 Q3, and over twice as prevalent (22.7/9.0) in 2012 Q4.  The drops in hunger by 7.9 points among the poor, and by 2.6 points among the non-poor, combined to bring about the drop in the national hunger rate, despite the increase in the proportion of the poor in the last quarter.

Hunger is always more prevalent among the poor than among the non-poor.  This is one of the checks on internal consistency of the survey interviews.  Another check is that the “food-poor,” or the families that regard their food as “mahirap,” should have the highest hunger rate of all.

Indeed, among the food-poor, hunger was 34.8 percent in 2012 Q3, and it dropped to 25.8 percent in 2012 Q4.  Among the non-food-poor, hunger likewise dropped, from 13.5 percent in 2012 Q3 to 8.8 percent in 2012 Q4.  Combined, the two drops account for the drop in the national hunger rate over the last two quarters, despite the simultaneous increase in food-poverty from 35 percent to 44 percent of families.  (All the above figures are in the SWS media releases of Jan. 10 and 14; see www.sws.org.ph).

Year to year. The time-trends of hunger and poverty should be assessed, not merely from the last two quarters, but from the big picture of all the data available.  Last week’s column (“A fresh drop in hunger” (Inquirer, 1/12/13) gave the average annual hunger rates in the Philippines ever since SWS started surveying it quarterly in 1998.

Self-rated poverty was found to be at 55 percent when first surveyed nationwide in April 1983 by the Development Academy of the Philippines.  When next surveyed in July 1985, by the Bishops-Businessemen’s Conference, it had risen to its all-time high of 74 percent, due to the 1984-85 hyperinflation.  In 1986-1991, when SWS surveyed it semestrally, it got the following average percentages: 1986, 57; 1987, 47; 1988, 66; 1989, 62; 1990, 68; and 1991, 67.

Afterwards, surveyed quarterly, the SWS Self-rated poverty annual averages have been: 1992, 66; 1993, 65; 1994, 68; 1995, 63; 1996, 59; 1997, 59; 1998, 61; 1999, 61; 2000, 57; 2001, 62; 2002, 63; 2003, 60; 2004, 51; 2005, 53; 2006, 54; 2007, 50; 2008, 53; 2009, 49; 2010, 48; 2011, 49; and 2012, 52.

In “Terraces of poverty” (Inquirer, 11/19/11), I said that “In fact, poverty has been flat at about 51 percent since 2004.”  From today’s vantage point, one can see that the poverty rate has stayed on a terrace for the past nine years.  I pointed out the previous terraces—“before that, poverty was flat at about 61 percent in 1995-2003… and before that, poverty was flat at about 66 percent in 1988-1994,” and added, “remember that poverty see-sawed during 1983-87.”

The relief from poverty in 1986-87 was due to the return to price stability; at one point inflation was as low as zero.  Poverty shot up in 1988, as annual inflation spiked up again to 20 percent.  Then Filipino families played catch-up, and by 2004 had roughly recovered to their level of 1983.

But they have not progressed since then—see my “The lost decade of the 2000s” (Inquirer, 7/14/12).  Econometric research shows that decades of economic growth did little to uplift the Filipino poor.  Stability of prices and adequacy of decent jobs mattered much more.

The Pantawid Pamilyang Pilipino Program. It is wrong to cite occasional “bad news” on poverty from the general SWS surveys as proof of failure of the 4Ps (in English, the Conditional Cash Transfer Program).  It is likewise wrong to cite occasional “good news” as proof of its success.

The Department of Social Welfare and Development has a separate scientific system, coordinated with the World Bank, for evaluating the impact of the 4Ps.  SWS was selected to participate in this effort, through competitive bidding.

The 4Ps involves at most P1,400 per month per beneficiary-family, conditioned on its children attending school. It is in effect a scholarship program, good for five years. The payoff comes much later, from the children completing more years in school and hence getting better jobs.

Recent SWS research shows that what the self-rated poor lack to reach their home budget threshold is closer to P4,000 per month. Thus being a 4Ps beneficiary does not lead to an instant conversion from poor to non-poor.

* * *

The SWS 2013 Annual Survey Review will be presented on Jan. 24, 2013, 8:30-11:30 a.m., SGV Hall, AIM Conference Center, Makati City. It is open to the public; reserve by phone (02)892-4011 local 562/Ms Ivyrose Baysic, fax (02)403-9498, or e-mail policycenter@aim.edu.

* * *

Contact SWS: or mahar.mangahas@sws.org.ph.