DUE TO PANDEMIC: 2.3M more Pinoys slip into poverty

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More Filipinos plunged into poverty in 2021 mainly due to the effects of the coronavirus disease 2019 (COVID-19) pandemic on the economy, according to data released by the Philippine Statistics Authority (PSA).

Based on the preliminary results of the Family Income and Expenditure Survey (FIES) in 2021, poverty incidence among population, defined as the proportion of Filipinos whose per capita income cannot sufficiently meet the individual basic food and non-food needs, was recorded at 18.1 percent, up from the 16.7 percent recorded in the last survey conducted in 2018.

This translates to around 19.99 million Filipinos who lived below the poverty threshold of about P12,030 per month for a family of five.

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The number of poor Filipinos rose by 2.32 million in 2021 from the 17.67 million recorded in 2018.

The subsistence incidence, defined as the proportion of Filipinos whose income is not enough to meet even just the basic food needs, likewise slightly increased to 5.9 percent in 2021, from 5.2 percent in 2018.

According to the PSA, it was estimated that a family of five needs at least P8,379 per month to meet their basic food requirements.

In nominal terms, the number of Filipinos considered food poor in 2021 were 6.55 million, up from the 5.54 million recorded in 2018.

Among families, around 3.5 million families or 13.2 percent were considered poor in 2021.

In comparison, there were three million poor families or 12.1 percent in 2018.

The subsistence incidence among families was observed at 3.9 percent, which is equivalent to 1.04 million poor families below the food poverty line.

In 2018, there were 840,000 food poor families, equivalent to 3.4 percent.

Meanwhile, the income gap, which measures the average amount of income required by the poor in order to get out of poverty expressed in relation to the poverty thresholds, was estimated at 22.6 percent in 2021.

This means that on the average, a poor family with five members need an additional monthly income of about P2,719 to move out of poverty in 2021.

At the regional level, the PSA said regions with the lowest poverty incidence among families in 2021 were National Capital Region (NCR), Cordillera Administrative Region (CAR), Central Luzon and Calabarzon.

On the other hand, the Autonomous Region in Muslim Mindanao (ARMM) consistently figured with the highest poverty incidence among families at 29.8 percent in 2021.

Moreover, the PSA said more than half of the regions posted significant changes in their incidences from 2018 to 2021. The regions with significant increases were NCR, Mimaropa, Ilocos Region, Central Luzon, Calabarzon, Western Visayas, Central Visayas and Northern Mindanao.

On the other hand, significant decreases were observed in CAR, Davao Region and ARMM/BARMM.

Arsenio Balisacan, National Economic and Development Authority (NEDA) secretary, said based on the latest data, the country’s poverty incidence fell short of its 2021 target of 15.5 to 17.5 percent as indicated in the Updated Philippine Development Plan for 2017 to 2022.

“In 2018, we achieved our goal of lifting six million Filipinos out of poverty, four years ahead of our 2022 target. As we all know, the COVID-19 pandemic disrupted our growth momentum and development trajectory,” Balisacan said in a press briefing yesterday.

“The effects of the COVID-19 pandemic, including income and employment losses, caused the poverty incidence to rise. Restrictions on mobility and low earning capacity of poor households due to limited access to regular and productive jobs made the lives of Filipinos difficult. We take these 2021 poverty statistics as our baseline,” he added.

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The NEDA chief also said the effects of the inflation last year could have had negative effects on poverty.

According to Balisacan, the current administration’s poverty reduction efforts will focus on three main areas: full reopening of the economy; more investments in human capital, social development and social protection; and transformation of the production sectors to generate more and quality jobs and competitive products.

“COVID-19 has revealed the weaknesses in our health, nutrition, education and social protection systems, mainly with the rigidity of delivery modes. We, in coordination with stakeholders, including civil society, will address these weaknesses. On social protection, we will make full use of the National ID to modernize and rationalize our social protection system. Some may need legislation, like the establishment of the Centers for Disease Control and the Virology Institute of the Philippines, and education reform,” Balisacan said.

Given the government’s planned strategies and the whole-of-society approach, poverty incidence can be reduced by 5 percentage points at midterm, and another 4 percentage points by 2028, he added.

“We aim to reduce poverty incidence among Filipinos to nine percent by 2028,” Balisacan said.

During the briefing, Balisacan was asked if the reduction in poverty incidence by 5 percentage points by 2025 remains feasible given the faster inflation, to which he said: “It’s very much feasible, in fact I was quite elated that the number for 2018 is 18 percent.

In our assumptions, we were actually working on 20 percent poverty for 2021. So this gives us the confidence that the number that we are projecting for this administration (is) very much doable.”

“I am quite confident that the poverty incidence in 2022 will be lower. We won’t have an official data because the official data will be for 2023. But we can say that given the greater opening up of the economy in 2022, and the reduction in unemployment and underemployment numbers, it’s likely that the poverty incidence would be lower despite the uptick in the inflation, even more so as we try to reduce the burden of the high prices on the poor by targeting our cash transfers program… to the most deserving members of our population,” Balisacan said.

National Statistician Dennis Mapa, for his part, said the next poverty threshold, or the minimum income/expenditure required for a family/individual to meet the basic food and non-food requirements, is seen to increase amid the higher inflation.

“The inflation as we’ve seen it, it will actually increase the poverty threshold. The next round of the FIES will be done next year for the 2023 report because, as approved by the PSA board, official poverty statistics will be reported every two years. So we will be recomputing the poverty threshold for 2023. And given the increase in food inflation in particular, we expect that the poverty threshold will also increase,” Mapa said.

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