Slow pay rise to increase number of poor families

MANILA, Philippines - Slower pay hikes – especially among low salary earners – are expected to increase the numbers of poor Filipino households this year, an official said. Since the hike in salaries – especially among the lower income brackets – “is not as fast as the increase in prices," Filipinos above the poverty threshold may find themselves below the poverty line, Romulo Virola, secretary general of the National Statistical Coordination Board (NSCB) said. Virola also blamed high consumer prices and the growing population for the possibility of increased poverty incidence, measured as the proportion of families whose earnings are insufficient to cover costs of living. He made these points while at the sidelines of the Users’ Forum on the 2006 Poverty Statistics for the Basic Sectors and the 2006 Child Development Index. The Philippines’ economic growth during the past years mainly benefited the higher income classes and not those who earned less, he told reporters. “It's not automatic that when an economy grows, poverty will be reduced," he said. Moreover, he added that the government should look for ways to hike salaries of Filipino workers. “Since 2009 is a survey year, it’s a challenge for decision-makers to do ways on how to increase the salary of workers," he said, warning that poverty incidence may worsen. During the same event, it was announced that the National Statistics Office is set to conduct the Family Income and Expenditures Survey (FIES) this year. Besides being undertaken every three years, the FIES is used as the basis of poverty incidence computed by the NSCB. Poverty incidence rose to 26.9 percent in 2006 from just 24.4 percent in 2003, a period in which the average economic growth was 5.4 percent. Increased poverty has also matched the decline in Filipino children’s human development index during the three year period. The Philippines’ child development index (CDI) – which measures childrens’ health, education, and quality of life – has slightly deteriorated by 0.003 points between 2000 and 2004 and by 0.050 points between 2003 and 2006. “Also worrisome is the fact that the number of regions that rated high in CDI, continually decreased between the period 2000 and 2006," NSCB said. In 2006, there were 14.41 million poor Filipino children, higher than 2003 levels of 13.47 million. “Fishermen, farmers and children comprised the poorest three sectors in 2006 with poverty incidences of 49.9 percent, 44 percent and 40.8 percent, respectively," NSCB said. All sectors posted increases in poverty incidence between the period 2003 and 2006, the agency added. Earlier, economists have already said that the economy needs to grow by at least seven percent a year before it can help cut poverty incidence, measured as the proportion of families whose incomes are below the poverty threshold. For every one percent increase in GDP, the poverty incidence falls by 0.6 percent, economists said. Last year, the country’s economic output grew by only 3.8 percent from an earlier 4.6 percent. In 2007, growth reached 7.2 percent, higher than the previous year’s 5.4 percent. For this year, the economy is expected to grow between 0.8 percent to 1.8 percent. - GMANews.TV