No magic bullet

The bad news is the pork barrel scam, compounded by the Malampaya Fund scandal, squandered over P10 billion—and counting. The good news is that a  P67-billion chunk, among others, eluded the  ladrones.

That fund is going to four million dirt-poor families in the form of  monthly grants ranging from P500 to P1,400. These have strings stitched on: Parents must keep kids in school, get them immunized and dewormed. It provides impoverished pregnant mothers with prenatal and postnatal checkups. Health personnel attend to their deliveries.

Meet the “conditional cash transfer program” (CCT), aka Pantawid Pamilyang Pilipino Program (4Ps). And credit President Gloria Arroyo for launching 4Ps in 2008. But graft crippled her government and enmeshed her and 23 subordinates in plunder charges. Thus, the 4Ps never budged beyond a P4-billion token.

President Aquino, however, ramped the 4Ps budget to P39 billion, then to P44 billion last year. In 2015, 4Ps could buffer 28 million beneficiaries. They would be a quarter of the population then. “No social protection program in our history ever reached this scale,” notes Lila Ramos Shahani of Poverty Reduction Cabinet Cluster.

Maybe so. But see that in context. The National Statistical Coordination Board estimates P180 billion is needed yearly for poverty alleviation. And population rises because birth rates still decline slowly.

CCTs have been around for a couple of decades. We track  successes notched up by Latin American countries. Like Colombia, the Philippines is bugged by insurgency. Colombia’s Familias en Acción found that CCTs helped increase enrollment even in conflict-marred regions. The University of Denver’s study “Conditional Cash Transfers and Civil Conflict: Experimental Evidence from the Philippines” asserts: “There was a sharper drop in conflicts in villages where the program was introduced in 2009 than in those where (it) was delayed until 2010.”

Look at Mexico’s Oportunidades which helps five million poor folk in all 31 Mexican states. Bolsa Familia is the  world’s largest CCT program, reaching more than 46 million Brazilians. Since 2011, Brazil lifted around 22 million of its people out of extreme poverty. The share of Brazil’s poorest 20 percent in the country’s wealth increased from 2.6 to 3.5 percent.

Bangladesh has three million kids unable to attend primary school. A CCT program targeted street kids and other hard-to-reach children. Primary school enrollment surged by 9 percent. In Cambodia, high school attendance rose to 43 percent, following CCT initiatives. Turkey reports a similar pattern.

In Africa, however, supply constraints, shabby infrastructure, etc., hobbled CCT projects, notes Harvard University’s School of Public Health. Present African CCTs focus on food insecurity rather than human development.

Today, the Philippine program keeps young children (3-11 years old) in school, a 2012 evaluation found. As in Nicaragua, this whittled down severe stunting among young children (6-36 months old)  and boosted rates of immunization. Impoverished pregnant mothers got prenatal and postnatal checkups. Health personnel attend to their deliveries.

Significantly, “4Ps does not promote a culture of dependency,” reported the World Bank. The Philippines’ program showed “positive results on elementary education school enrollment and beneficiary households spending more on health and education of their children,” the Asian Development Bank’s independent evaluation department found.

Both put their money where their mouths are. The World Bank released a $300-million development loan to support antipoverty programs and “to expand the CCT program.” ADB put in  $400 million.

The Philippine Institute for Development Studies (PIDS) cautions that school enrollment in 4Ps families slump when they’re cut off from cash transfers: from 93 percent for children aged 13 to only a third (33 percent) when they reach 18.

PIDS suggests providing longer assistance—from five to 10 years. The target would be to help until kids finish high school. They would earn at least 45 percent more. Government is seeking to curb leakage estimated at 28  percent and to expand coverage. Expanded coverage is in the works—it would take in indigenous people and children with various forms of disability.

But planners can be lulled into the notion that CCTs are a cure-all. No such economic instrument exists. Latin America  has the longest tradition of CCTs. Yet that continent increasingly sees cash transfers as a valuable complement to, not a substitute for, structural reforms.

In the Philippines, these do not merely mean budget-juggling. Sen. Miriam Defensor-Santiago, for instance, calls on Congress to scrap, once and for all, the P25-billion congressional pork barrel from the P2.226-trillion national budget for 2014. In addition, she proposes integration into the money bill of off-budget sources of cash. That would include, among other things, the P130-billion Malampaya Fund; P12.5-billion motor vehicle users’ charge; the Pagcor Special Fund and the PCSO Charity Fund.

Great. But what about “restitution”? Justice and law requires that the thief return what is not his. Those who looted the pork barrel and Malampaya Fund must repair the damage. It is not enough for Jinggoy Estrada to say others looted, too. The looters must adopt former tax collector Zacchaeus’ formula: “If I have defrauded anyone of anything, I will pay back four times as much.”

Beyond that is the need to back the Ombudsman in prosecuting  those charged. Justice is the bedrock of structural reforms.

CCTs “are worth serious consideration as part of an integrated poverty alleviation strategy,” says the International Fund for Agricultural Development, “But they are not a magic bullet.”

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