You are on page 1of 20

BENCHMARKING THE PERFORMANCE OF THE DUTERTE ADMINISTRATION, YEAR 1 (Full Report)

MOVEMENT FOR GOOD GOVERNANCE 1

The Movement for Good Governance (MGG) is a coalition of individuals and organizations that was organized in 2008. Its convergence was sparked by the need to help restore transparency, accountability, integrity, and honesty in government. Instead of cynicism and indifference, MGG aspired to provide the spark that will ignite the people’s passion and love of country. MGG believes in empowering the citizens through objective assessments of candidates running for public office, and once elected, benchmarking their performance based on their platforms.

MGG started benchmarking the performance of the administration in 2010 using a scorecard system.

What would an “objective” or “fair” approach in evaluating performance of the administration?

assessment must be based on a metric or what the President himself set out to do as spelled out in his

promises when he was running for office. those set by himself, and no one else. 2

The

The standards against which the President will be judged are

To help ensure an objective assessment process, scoring is done based on results that are based on data and indicators, and not on perceptions. The rating scale that has been used is as follows:

Score

Assessment

0

The President has broken his promise.

2.5

There has been very slow or little progress on his promise.

5

Something has been accomplished but is lower than expected.

7.5

The administration is on track and is expected to achieve the scheduled.

target as

10

The target has been achieved as scheduled.

The assessment study is meant not to be a critique but a tool for identifying successes and alerting government on areas that need strengthening and improvement. Supporting the President entails affirming his performance in areas that he has done very well. But it also involves reminding him what policies and practices are not coherent with his platform and promises.

The Movement for Good Governance (MGG) believes that citizens should continuously be engaged in a dialogue with government. They should affirm the administration for programs that have succeeded. An open dialogue augurs well for growth, collaboration, and better performance.

The overall rating of the President is 4.71. It can go up to 4.95 if the employment figures which are still forthcoming will show an increase in new job generation. The score means that what has been

1 The Chairman of the Movement for Good Governance is Prof. Solita Monsod, former Secretary of Planning. The scorecards of the MGG are found in ttps://mggphilippines.org

2 His election platform was later on translated into a 10-point socioeconomic agenda.

accomplished is lower than expected. The administration got a rating of 4.6-5.6 in managing the economy; 4.75 in public finance, 5.5 in agriculture, 3.75 in governance, and 5 in health protection.

The Economic Scorecard

1.

Introduction

Insofar as the economy is concerned, President Duterte was quick to give credit where it was due, even during the presidential debates Admitting that the economy was not his strong suit, he at least knew a good thing when he saw it. Since the economy was doing well, he was content with continuing the economic policies of the previous administration.

This attitude did not change when he won, and of his economic team – the secretaries of Socio- economic Planning, Finance, Budget and Management, and the Bangko Sentral Governor, and NEDA – the first three had served with distinction in previous administrations and the head of NEDA was picked from the usual NEDA breeding grounds, the UP School of Economics.

Continuity was assured. And if there is still any doubt, the first of his 10-point Socio-economic Agenda will put it to rest: “Continue and maintain current macroeconomic policies including fiscal, monetary, and trade policies.”

It is not surprising to note, therefore, that Duterte’s Philippine Development Plan (PDP) 2017-2022 is similar to that of its predecessor’s plans – emphasis on rapid but inclusive, employment creating growth, equity, stability, and good governance. The buzzwords are different, but they all want the same thing. The Ambisyon Natin 2040, the long term vision that was adopted by Du30, was conceived during PNoy’s time.

There are, however, some important differences: Where PNoy Aquino swore that there would be no

new taxes during his administration (getting him to accept the Sin Tax Reform bill was like pulling teeth from a chicken), the second point in Duterte’s 10-point Socio-economic Agenda is “Institute progressive

tax reform…

passed the House of Representatives, and is now in the Senate.

indexing

taxes to inflation….” The tax reform package, called TARA sa TRAIN has already

There are differences in emphasis, too. Du30’s tenth point, to strengthen implementation of the Responsible Parenthood and Reproductive Health Law, is definitely a departure from the other plans, which soft-pedaled this item in deference to the Catholic hierarchy.

Further, his emphasis on agriculture, which is discussed elsewhere, is a sea change from his predecessor. Also, with respect to poverty, this is the first time the MGG has seen a target on rural poverty specifically set. This to ensure that inclusion is being focused on.

Another first: Human development has been a major issue in development plans since the Ramos administration. But Du30’s PDP goes one step further: it actually has a target for human development. As will be seen later, however, this target is almost meaningless, because it requires no effort to achieve it.

Lastly, in line with poverty and inclusive growth, the PDP 2012-2017 focuses on Areas outside NCR (AONCR) – and sets targets for them specifically in terms of underemployment, and inflation. It also aims to reduce interregional inequalities.

It therefore can be concluded that theDu30 administration’s contribution to Philippine development planning is the explicit shift of attention away from “imperial Manila” and the greater emphasis on the rural and agricultural sector—probably because that is where poverty abounds.

The next section will proceed with the evidence-based evaluation of the Du30 administration’s accomplishments. He will be measured against the targets set out in Ch. 4 of PDP 2017-22, and using the MGG scoring system.

2. Scorecard for the Economy : Overall targets and accomplishments in the first year of the Duterte Administration.

The following is the list of targets set out by Du30 for 2022, accompanied, wherever possible, by what his administration has achieved so far, based on data provided by the Philippine Statistics Authority.

What is that? An upper

middle income country is one whose per capita GNI is between US$, PPP 3956 and US$PPP 12,235. Our per capita GNI was already US$PPP 3,580 in 2015.

Target 1. “The Philippines will be an upper middle income country by 2022.”

The growth rate that will bring it to upper middle income level, according to the PDP, is 7-8% in real terms. At that yearly rate, the country will double its GDP in 9 to 10 years , which means that after the six year plan period , its GDP will increase by more than 50%. No problem hitting that upper-middle income status, even with lower growth rates.

But since the GDP growth target is 7-8% a year, has the Du30 administration achieved it? Here is the

available data:

The growth rates of the economy for the first three quarters of year 1 of Du30 are:

 

3Q’16

4Q’16

1Q17

2Q1

Real GDP growth rate (%)

7.1

6.6

6.4

?

Therefore, the growth rate for the first three quarters of Du30’s first year averaged 6.7% (one cannot

help but notice the declining trend).

7-8% in its first year, GDP growth in the second quarter of 2017 will have to range from 7.9% (to achieve a growth rate of 7%) to 11.9% (growth rate of 8%). Clearly, this is not achievable. Additionally, the most sanguine of growth rates forecast for the Philippines is that of the World Bank, which puts it 6.9% for

the calendar year 2017 which is very close to the bottom end of the Outlook has a lower forecast of 6.5%.

It follows that for the administration to achieve a growth rate of

target.

.The Asian Development

According to the World Bank, this projected growth rate of 6.9% for the calendar year 2017 places the

country in the top ten (actually, #10) among the world’s fastest growing economies.

projection can be achieved is problematic: it will require, given our performance in the first quarter, a growth rate averaging 7.1% for the next three.

Whether that

Target 2: “Growth will be more inclusive as manifested by a lower poverty incidence in the rural areas, from 30 percent in 2015 to 20 percent in 2022.” As stated above, this is the first time that rural poverty explicitly comes into the picture. It is targeted in addition to targets on overall poverty (from 21.6 % to 14% -- or lifting 6 million out of poverty), on subsistence poverty (from 8.1% to 5%). In conjunction with this, as an early warning system, food inflation will be monitored, and should be within the bounds of over-all inflation (i.e. 2-4%).

Unfortunately no PSA data are as yet available on these various indicators. Until such time, we will make do with the results of the SWS surveys, which track self-rated poverty and food (subsistence or

core) poverty.

Under his watch, the indicator decreased to 42% (Sept. 16), went slightly up to 44% (Dec. ’16). On March’17, self-rated poverty went up to 50%. Mahar Mangahas described the trend thusly: “Prior to this rise, the Self-Rated Poor proportion had been either steady or declining for nine consecutive quarters, from the fourth quarter of 2014 to the fourth quarter of 2016.” The June’17 survey showed a decline once again to 44%

The surveys show that when Du30 took over, self-rated poverty was at 45% (June ’16).

With respect to self-rated food poverty, the indicator exhibited the same pattern, initially decreasing in September (to 30%), and then increasing to 34% in December, to 35 % in March, and back to 33% in June. But the indicator shows regional variations. For example, the self-rated food poverty decreased slightly in NCR and in Mindanao, remained practically the same in the Visayas, but increased in balance of Luzon

Given the margin of error in these surveys (+_3% nation, +-6% regions), the administration cannot claim that poverty has decreased during Du30’s first year.

Social Weather Stations Survey Results for Self-Rated Poverty and Self Rated Food Poverty

Self-rated poverty

Self-rated food poverty (percent)

 
   

Phil

NCR

Luzon

Visayas

Mindanao

Sept.’15-June ‘16

48

33

22

27

40

43

September ‘16

42

30

20

24

36

41

March ‘17

50

35

20

41

33

45

June ‘17

44

32

16

27

44

41

Average

45

33

20

31

39

39

Score: 2.5

Target 3: “The Philippines will have a high level of human development by 2022.” Human

Development is in the simplest terms, is the widening of people’s choices. It is measured by the Human Development Index (HDI), which looks at three outcomes of development: the state of health, the level

of knowledge and skills, and the level of income. to 1 (highest).

The value of a country’s HDI can range from 0 (lowest)

Countries are classified as having Very High human development if their HDI is equal to or greater than

0.80. They have High level of human development if their HDI is between .70 and less than .80. They

have Medium level of human development if their HDI is between 0.55 and less than 0.70. Countries with HDIs lower than 0.55 share a Low level of human development status. Since the target does not specify what the High Level HDI will be, it is assumed that the lowest level of the range (0.70) is what is being aimed for.

The Philippine HDI, as of the 2017 Human Development report (which means 2015 data) is 0.682, which identifies it as a medium human development country. To get to High Level, its HDI has to increase by 0.18 points in seven years’, which in turn implies that its growth rate must be 0.38% annually. The Philippines, for the period 1990 to 2015, exhibited a much higher HDI growth rate of 0.61%.

Average Annual Growth Rate, HDI, Philippines (%)

1990-2000

2000-2010

2010-2015

1990-2015

0.60

0.72

0.39

0.61

Judging from the experience of 26 years, one can say that the Du30 target will most certainly be

achieved, because the target is lower than the previous 26 years HDI performance. This may be called

low-lying fruit, designed to make the administration’s achievements look better.

least have been a growth rate of 0.61%, in which case, the Philippines HDI by the end of 2022 will be a higher 0.711.

The target should at

Score: 7.5

Target 4: “The unemployment rate will decline from the current 5.5 percent to 3-5 percent in 2022. Assuming a slight increase in labor force participation rate to 64.1 percent, this implies that 950,000 to 1.1 million new jobs will be generated per year. Youth unemployment rate will decline to about 8% from the current 11%. In areas outside NCR (AONCR), emphasis will be on improving the quality of employment. The underemployment rate in AONCR will be reduced to 16-18% by 2022.”

Since the PSA conducts quarterly surveys on labor force and unemployment, we have data covering the

first three quarters of Du30’s reign.

And they don't look good.

Unemployment Rates, Jobs Generated, First Three Quarters of Du30

 

Oct’16

Jan ‘17

Apr.’17

Ave/Total

Unemployment rate (%)

4.7

6.6

5

5.67

Jobs Generated (000)

1,936

1,363

393

180

Source: Labor Force Survey

The table above shows that for the first three quarters of the Du30 administration, the unemployment rate was higher rather than lower than the base year rate of 5.5%. Unless the unemployment rate for the last quarter of Du30’s first year turns out to be 4.8% (thus making the average for the year 5.45%, which will show a small move toward achieving the target), the score will have to be a failure.

In like manner, with respect to new jobs generated, the 180,000 shown is far below the targeted 950-1.1 million new jobs a year, unless of course, the July ’17 LFS survey will produce 770,000 new jobs.

Score: 7.5 (this assumes that the July ’17 LFS will show an unemployment rate of 4.8% and job creation 770,000 new jobs, which is not a heroic assumption.)/ 2.5 (if the assumptions are not fulfilled).

Target 5: “There will be greater trust in government and in society. The indicators for this will need to

be developed and measured by the Philippine Statistical Authority for 2017 and 2022” will be no basis for scoring until 2022.

Therefore, there

Score: no basis, and not applicable until 2022.

Target 6: “Individuals and communities will be more resilient.” The PDP says that an index will be developed considering three components: reducing exposure to hazards, mitigating the impact of the risks, and accelerating recovery if and when the risks materialize. The data will still have to be collected and the 1918 baseline will still have to be determined. Apparently, again, only the 1918 and 1922 values will be compared.

Score: No basis. And scoring will only be done in 1922.

Target 7: “Filipinos will have greater drive for innovation”.

be measured by Philippines’ rank in the Global Innovation Index. The Philippines is targeted to rank among the top third of the countries in 2022, from its 1916 position in the second third (74 out of 128

countries).

The administration’s accomplishment will

Score: No basis. Data for 1917 still unavailable.

Summary 3

Areas for assessment

Score

Growth

5.0

Poverty reduction (inclusive growth)*

2.5

High level of Human development (2015 data)

7.5

Employment**

2.5/7.5

Trust in Government***

n.a.

Resilience of individuals***

n.a.

Innovative Filipinos ****

 

Overall score

4.4 -5.6

* subject to change with the availability of official data. **The higher score will apply if the 2Q LFS, which is still forthcoming, shows an unemployment rate of 4% and a new job generation of 880,000. Failing that the lower score applies

3 Based on targets set in Ch.4, Philippine Development Plan, 2017-2022

*** The indicators for these have not yet been constructed. The Philippine Statistics Authority will provide them **** Data exist, but is not yet available for 2017.

Performance in Public Finance

Public finance was not part of the core platform of Mr. Duterte during the campaign. His main concern was to stop corruption in government, dismantle the cartel of an alleged rice smuggler, and improve infrastructure.

In the presidential debates in Feb 22, March 20, April 24, and May 18, 2016, he promised to stop corruption in government within 6 months. He committed to impose a 72-hour processing time for government certificates and clearances.

The dismantling of the rice cartel was made in the presidential debate in Cagayan de Oro. The establishment of a railway in Dagupan was announced during debate in Dagupan.

The public finance agenda of the Duterte administration became more defined in the 10-point Socio- economic Agenda which provides the following:

1. Continue and maintain current fiscal agenda

2. Institute progressive tax reforms, more efficient tax collection, indexing taxes to inflation and a tax reform program

3. Accelerate annual infrastructure spending to account for 5% of GDP with Public Private Sector Partnerships (PPP ) playing a key role

4. Improve social protection including CCT to protect the poor against instability and economic shocks.

1. Maintaining the Fiscal Agenda. The Duterte administration has already departed from the current fiscal agenda. A shift towards Official Development Assistance (ODA) and local financing was announced with the cancellation of PPPs for 5 regional airports. Government explained that these alternative modes would provide lower costs of money, faster and more efficient project completion.

The policy turnaround regarding PPP has caught many by surprise. The numbers show that costs are lower under PPP arrangements. V. Montes cites that the government-administered Subic-Clark expressway took 7 years to complete and costs twice as much as its approved budget. The cost per kilometre, is more than five times higher than Tarlac-Pangasinan-La Union-(TPLEX) (P341 million vs. P61 million.) In addition, PPPs mobilize private capital and leverage private sector expertise. PPPs are a fairer mode of financing since only users of the facility bear the costs. Compare this with financing an infrastructure in Metro Manila through borrowings. The burden is borne even by those in the islands who do not benefit from the infrastructure projects 4 .

The strategy of debt-financing has several caveats especially with the inability of revenue agencies to reach their targets, which in turn limits the ability of government to repay its debts. The revenue

4 This concept is well amplified by former Planning Secretary Ciel Habito.

collecting agencies have not achieved their targets in 2016. The BIR underperformed or failed to collect programmed revenues by P458 billion. It collected P1.57 trillion compared to its target of P2.02 trillion. The BOC likewise failed to collect its target of P498.67 billion and fell behind by P102.3 billion.

Government has struggled hard to overcome its debt problem. Our outstanding debt of P6.09 trillion is estimated to increase by P1.005 trillion in 2 years (with a deficit of P478.1 billion in 2017 and P526.9 billion in 2018). This is hard to imagine even considering the most optimistic assumption that the tax reform package will bring in additional revenues of P163 billion.

It is unfortunate that the Duterte administration did away with the Bottom-up Budgeting (BUB). BUB has been well recognized not only in the Philippines but internationally for mobilizing the participation of non-governmental organizations and the grassroots in shaping the budget agenda. Government gave up a significant step in empowering communities and promoting participatory governance.

Score: 4.5

2. Tax Reform Program. The Duterte government lived up to its promise of introducing a tax reform program. Its efforts in this regard are appreciated. Much work has been devoted to its formulation by the DOF. The proposals are well studied and its effects are quantified. The proposal carries a subsidy program to shield the poor from the impact of increases in the excise tax on petroleum products.

The tax reform program is constrained by the promise of a generous give-away through the grant of P250, 000 exemption to every taxpayer regardless of status. This will result to a revenue loss of P137.0 billion. It is intended to be recouped through an adjustment in the excise taxation of automobile (P24 billion) and petroleum (P74 billion); P43.8 billion from improvement in administration, and, P65.8 billion from complementary measures. The impact of the last two programs is quite fuzzy. Improvement in tax administration is important, but they need to be supported by behavioral and systemic changes. These take time and resources. It is unrealistic to expect that they will produce such huge revenue estimates in the short-run.

The MGG considers the adjustment in excise taxes as necessary and timely, but the excise tax on petroleum has significant cost implications. While the input-output table only shows a 1.13% increase in the cost of the electricity, a P3.00 increase in the excise tax on fuel translates to an increase in the

monthly electric bill of consumers from

(assuming consumption of P400.00 kwh per month.

P16.96 for grid consumers and P282.61 for non-grid consumers

The DOF estimates that families from the lowest income decile will suffer a net loss in their monthly

income from P873 to P1, 168. This will be compensated with targeted transfers of P200 pesos per month for 1 year to the poorest 50% of households (10 million households). However, the details of its

efficient administration are still being worked out.

nightmare with stories of ineligible beneficiaries, and families selling their ATM card at a discount. The

current DSWD Secretary mentions that the program can be manipulated sans clear guidelines and tight monitoring. The program is still currently dealing with unliquidated amounts and unclaimed grants.

The administration of the CCT was a logistical

The subsidy is intended for a year. What happens then during the succeeding years? We cannot expect poor families to develop the necessary coping mechanism for the price increases just after a short period.

In contrast, the tax reform will benefit families from the highest decile with the reduction in income tax rates and the grant of a generous tax exemption. The DOF estimates that their monthly pay will increase by about P66, 775. This is progressivity in reverse. More than 37% of our labor force is exempt from income taxation. They have nothing to gain from the tax reform but have everything to lose because of the impact of excise taxation and the increase in inflation.

The effect of the tax program in the medium-term is the erosion of the income tax base and a greater reliance on indirect taxes.

MGG likewise notes the need for greater consistency with the policy intent and the action of Congress. While the Lower House has approved package 1 of the tax reform program, it has introduced major

amendments.

the proposal of the automobile industry. To make up for the revenue loss, the Lower House introduced

a tax on soft drinks which will burden the poor even more. There is a very slight difference in the

consumption pattern of non-alcoholic beverages between the wealthy and the poor. Soft drinks take up about 1% of the expenditures of the poor and 1.2% of the wealthy. The Lower House has also approved

a reduction of the inheritance tax and reinstituted a two-tiered tax regime for cigarettes. The first

measure weakens the progressivity of the tax system and the second one reinstitutes opportunities for avoidance and evasion.

MGG observed that the DOF proposed taxation of motor vehicles has been replaced by

Score: 6.0

3. Accelerate Annual Infrastructure Program.

age of infrastructure with its “Build, Build, Build” program. It has unveiled its infrastructure program equivalent to 5.4% of GDP, keeping with its promise.

The Duterte administration enthrals us with the golden

DBM Secretary Diokno 5 said that “there would be no underspending in the next six years”. However, data from the Bureau of the Treasury show that government’s spending fell by P446.billion relative to program in 2016. Further, government expenditures for infrastructure in the first quarter of 2017 of P142 billion was lower than the P145.8 billion in the same period last year. The lower than expected GDP growth of 6.4% in the first quarter is attributed to the slackening of public construction. The government may be realizing by now that efficient disbursement does not only entail intentions but addressing the low absorptive capacity of the bureaucracy.

It is worth noting that many of the infrastructure projects of the Duterte administration are a

continuation of those that were began by the past administration. These include the Tarlac, Pangasinan,

and La Union Expressway; the Cavite-Laguna Expressway; the Central Luzon Link Expressway; the NLEX SLEX Link Connection; the Manila Bay Integrated Flood Control, among the many others.

Score: 5.0

4. Stopping Corruption in 6-months. MGG recognizes the initiatives that were initiated by the administration to streamline government operations.

5 Statement before the House Committee on Appropriations as reported by the Philippine Daily Inquirer, August 24, 2016, “Aquino Regime Underspent P1.0 trillion.”

EO 6 put in place a citizens’ complaint hotline and a feedback mechanism from the public.

EO 18 streamlined the procedures for negotiating and approval of defense contracts

EO 30 organized an Energy Investment Coordinating Council to simplify approval of energy projects.

EO 34 lifts the requirement for agencies to get an exemption from public bidding from the Government Procurement Policy Board, if certain conditions are met

Success stories have been posted by the 8888 hotline but these are anecdotal. It is too early to say if the hotline has produced significant changes in government processes and procedures. It can be a band aid solution to red tape. It must be noted that this is not a novel idea since many local governments have instituted a 911 hotline system, Marikina City being a pioneer in this regard.

The effects of the “amendments” to the procurement system cannot yet be seen. Will they result to greater efficiency or will they create opportunities for abuses in authority?

MGG sees inconsistency in the government’s stance against erring officials. While Mr. Duterte took haste in firing 92 officials because of claims of corruption, he ordered the reinstatement of 19 policemen including Supt. Marvin Marcos who have been charged in the killing of Leyte Mayor Espinosa. There are no clear parameters on giving sanctions and rewards for public officials which is confusing to the public.

The confused state may have resulted to the Philippines obtaining a score of 35 in 2016 which was the

same as its score in 2015 in the Global Corruption Index. The country’s ranking slid to 101 out of 175 countries compared to 95 out of 168 countries in 2015 and 95 out of 175 countries in 2014. The report observed that corruption is fostered by unaccountable government, shrinking space for civil society

pushing anti-corruption action to the margins and the rise of populist politicians

”.

Corruption has not been stopped within a six-month timeline as promised by the administration.

Score: 4.0

5. Improving Social Protection for the Poor Including CCT. MGG appreciates the retention of the conditional Cash Transfer Program by the Duterte administration. The program has succeeded in

However, the administration has no

plans to broaden the CCT. DSWD Secretary Taguiwalo is firm in her stand not institutionalize the 4Ps. She believes that it has minor impact on solving the poverty problem. The only change that was made was the provision of a P600 cash grant to beneficiaries as a form of rice subsidy. Government has plans to ferret out inefficiencies in the system, but the results of such efforts are not yet known.

keeping more children in school and in reducing the dropout rate.

Score: Too early to tell.

Summary

Maintaining the fiscal agenda

4.0

Tax Reform Program

6.0

Accelerate Infrastructure spending

5.0

Stop corruption

4.0

C. Performance in Agriculture

Pres. Duterte had three promises: (a) halt agrarian reform, (b) distribute the coconut levy to farmers and develop new coconut farms, and (c) dismantle the rice cartel.

There are no metrics and timelines of the above actions. The President could have meant that the promises would be delivered over the six-year term. Halting agrarian reform means amending the law, and thus far, no law has been passed. The coconut levy issue, despite the urgency because of the coconut farmers’ abject poverty, is still a work-in-progress in Congress. Dismantling the rice cartel is a populist measure but there is little evidence thus far of this market collusion. Meanwhile, the cabinet members’ pronouncements have long-term strategic implications on agriculture investments:

(a)

Moratorium on land conversion, including agro industrial plants. The moratorium will discourage investments on processing plants that will buy raw materials from small farmers.

(b)

Rice self-sufficiency by 2019 which was later moved to 2020.

(c)

DAR Secretary’s belligerent attitude towards agribusiness regarding respect of contracts. The issue could have been settled in court or under independent arbitration. The DAR Secretary action is perceived by many industry players as “anti-agribusiness.”

PDP, 2017-2022. The Philippine Development Plan (PDP) target of 2.5 to 3.5 percent annual growth rate is doable. It will be a sharp contrast to the lackluster record of the Aquino administration of 1.2 percent a year. The key question is how this will help reduce rural poverty from 30 percent of rural population in 2015 to 20 percent in 2022.

Crucial

to

attaining

the

target

would

include:

road

maps

and

their

chain

corridors,

project

management, crop choice, benefit-cost analyses, infrastructure and climate change adaptation.

Given slowing domestic demand and limited water resources, rice sufficiency alone will not solve the high rural poverty. The PDP must cover the rest of the 80 percent of agriculture and fishery.

Rice Self-sufficiency. Pres. Duterte targets rice self-sufficiency by 2020. His administration has an ambitious target of fully irrigating another 1.27 million (M) hectares (ha) of irrigable farm lands by 2022 at the cost of over PhP300 billion (B). To date, only 59 percent (1.85M ha) are irrigated. 6 The 1.27M ha target is way overstated considering that water availability and current land use – urban, roads, among the many others will have a significant influence on target’s achievement.

Pres. Aquino’s declaration of rice self-sufficiency at 100 percent by 2013 (from 80 percent in 2010) was not achieved at the end of his term in 2016. This was an impossible target at the very start, and has used up lots of resources which could have otherwise been devoted to commodities with good market and income prospects such as cacao, coffee, oil palm and aquaculture. Hopefully, Pres. Duterte will change track and use benefit-cost metrics from farm income increases and impact on rural poverty reduction.

6 Irrigable areas consist of all contiguous areas of 100 ha or more with slopes not exceeding 3.0 percent (David, 1990).

Agricultural Exports. The PDP targets agricultural export growth of nine percent a year from about $5.1B in 2015 to $9.3B in 2022. This is modest compared to Malaysia at $25.4B, Vietnam at $26.5B, Thailand at $36.5B and Indonesia at $39.8B and (WTO, 2016). Expanding exports require investments in non-traditional and manufactured products. Investors are asking if the environment for agribusiness today is conducive for the attainment of the target.

Commodity Roadmaps. The DA has launched many commodity roadmaps including cacao and coffee. The past administration has prepared several commodity roadmaps but the release was put on hold owing to the inordinate delay in the preparation of the rice roadmap. The roadmaps are key inputs to annual budgeting and metrics of value chain corridors.

Rural Poverty Reduction. The PDP 2017-2022 targets to reduce rural poverty incidence of 30 percent in 2015 to 20 percent in 2022. In 2015, the Philippine rural poverty metric was highest among ASEAN peers. The farmers and fishers are among the poorest. The 2022 target of 20 percent appears “modest” since it would still remain the highest relative to ASEAN peers in 2015. Farm productivity and crop diversification are crucial to address low hanging fruits such as new coconut products, coffee, cacao, palm oil and fruit trees.

Rural Poverty headcount at National Poverty Lines

Country

2012

2013

2014

2015

2022

Philippines

35.0 (a)

   

30.0

20.0

Indonesia

   

14.2

   

Malaysia

   

1.6

   

Thailand

 

13.9

     

Vietnam

22.1

 

18.6

   

Memo:

     

Annual %

 

Philippines

change, 2012-

2015

- Farmers

38.3

   

34.0

1.43

- Fishers

39.2

   

34.4

1.60

(a) Briones, PIDS

Source: World Bank for ASEAN, PSA

Initial Gains. Growth in agriculture in the second half of 2016 recorded a 0.5 percent increase from a negative 3.2 percent in the first half, with full year growth of negative 1.3 percent (Philippine Statistics Authority - PSA).

Growth in the first half of 2017 will likely be around 4.5 to 5 percent, following a 4.9 percent rise in the first quarter. There is likelihood that the sector will hit four percent for the whole of 2017. This will be a significant recovery from the dry spell of 2016.

Table 1. Agriculture Growth: Aquino Years vs. Duterte PDP Targets Average Annual Growth Rate, Percent

Aquino Duterte

Aquino

Duterte

 

2011-2016 (Average)

PDP 2017-2022

CROPS

1.2

2.0-3.0

LIVESTOCK

2.4

3.0-4.0

POULTRY

3.4

3.0-4.0

FISHING

-1.5

 

Commercial

-4.4

2.5

Municipal

-1.2

1.0

Aquaculture

0.7

5.0

Total AGRI

1.2

2.5-3.5

Note: Average= mean of annual growth rates Source: PSA

Crops: Average annual growth rate during the Aquino administration (in percent)

 

Aquino

Duterte

2011-2016

PDP 2017-2022

Average

Palay

2.0

n.a.

Corn

3.3

n.a.

Coconut

-1.8

n.a.

Sugarcane

6.3

n.a.

Banana

-0.3

n.a.

Coffee

-5.0

n.a.

Rubber

-1.2

n.a.

Total Crop

1.2

2.0-3.0

Source: PSA

Summary. Overall, the rating of the Duterte period is 5.5 meaning: “something has been accomplished but is lower than expected.” This applies to all criteria as shown below:

Criteria

Rating

Remarks

Agriculture growth versus ASEAN peers

 

n.a.

Too early to tell

Agriculture productivity level and growth among ASEAN

n.a.

Too early to tell

Agriculture exports ASEAN peers

(level

and growth)

among

n.a.

Too early to tell

Commodity roadmaps

 

5.5

Too early to tell

Rural

poverty

reduction,

a

key

outcome

of

n.a.

Too early to tell

agriculture performance

 

OVERALL RATING

 

5.5

Much ground to cover to catch up with ASEAN peers

Performance in Governance

Governance is an abstract term to many Filipino. Often, the quality of governance is measured through

visible things like inputs, outputs and outcomes. But governance is a process.

which power is exercised in the management of a country’s economic and social resources.” 7 Secretary Robredo’s greatest legacy is his demonstration that good governance means participation,

accountability, transparency of effectiveness.

no governance if any one of these processes is flawed. It is difficult to assess how the Duterte administration has lived up to its platform on governance. His 20 election promises make no mention of how he intends to use the powers and resources of the Office of the President to promote the welfare of the citizens and to empower them. His promises are stated in terms of what he intends to do, regardless of systems and processes. Because MGG assesses based on data and performance indicators, the report is limited to assessing the results of his promises. 8

It is the “manner in

These processes are mutually exclusive and there can be

1. Suppress crime by 2016. The Index crime shows that the number of crime has decreased from 81,064 (July to Nov. 2015) to 55,391 in the same period in 2016. During the same period

however, PNP data show that the number of murder cases went up from 3,950 in 2015 to 5,970

PNP reported that 7,080 people have been killed on the war on drugs since July 2016. 9

in 2016.

Score: 2.5

1. Improve wages and equipment of military. President Duterte promised to double the salaries of the military and police in 3 years. He signed EO 3 that increased the amount of combat duty

pay of the military and police. The snag was that the President thought that salary increases could be done easily. He did not consider the budgetary requirement that funds for salaries have to be appropriated by Congress. Secretary Diokno prepared a joint resolution that was submitted to Congress for the doubling of salaries by 2018. Score: 5

2. Roll out Davao’s peace and order measures on a national level. MGG does not have any basis and no knowledge of the process on how this can be done. The peace and order situation in

every community differs

community. Score: 2.5

and what has been good for Davao cannot be applied in every

3. Release all political prisoners. It is estimated that there are 402 political prisoners. Ten were released in July and another 20 by the end of 2016.

Score:2.5

4. Amend the Constitution to lift laws restricting foreign investments. The House tackled a resolution to convert itself into a consituent assembly to amend the Constitution. Secretary Dominguez announced that the process will take a bit of time and the step that the administration will take is to review the negative list, i.e. investments that are not allowed to be controlled by foreign interests. Score: 2.5

7 World Bank definition of governance. 8 MGG encloses an article by Marites D. VItug that was published by Rappler on June 20, 2017 which gives a glimpse on the quality of his governance.

9 http://www.rappler.com/newsbreak/iq/145814-numbers-statistics-philippines-war-drugs

5. Bury President Marcos at Libingan ng Bayani. Mr. Duterte was true to his word. On July 11, 2016, he gave verbal orders to the Secretary of National Defense to inter the remains of President Marcos in Libingan ng mga Bayani. Score: 10

6. Pardon President Arroyo. President Duterte announced to the media in Davao City on May 23,2016 that he called former President Arroyo and told her “Ma’am gusto mo i-pardon kita? Not because we are friends but because I do not think that there is a good care against you as a prosecutor and lawyer.” 10 Although Former President Arroyo declined his offer, she was released in July 2016 after the Surpreme Court dismissed her corruption charges due to insufficient evidence. Score: 10

7. Stop corruption in government. As cited earlier in this paper, the Philippines did not improve in its standing in the Corruption Index in 2016 and retained the score it obtained in 2015. Score: 4.0

8. Push for a federal form of government. The administration is going strong with this push regardless of the absence of studies especially on the capacity of government to finance a federal government. The manner through which the federal government will be financed is stated in general terms. An equalization fund is mentioned but the formula on how the fund will be distributed is unknown. There are many issues that have not been settled such as the definition of minimum standards of service delivery by federal governments and their capacity provide each citizen with the set standards. Score: 4

9. End illegal labor contractualization. Government reports that 49,393 contractual employees have been regularized but this only represents 7.4% of the total number of contractual workers. During the debates, Mr. Duterte was reminded that ending contractualization is a complicated process because laws need to be amended. A Department Order has been issued for agencies,

and not the main employers to regularize their workers.

order does not address the problem of workers who are hired by manpower agencies on a contract basis and sent to client establishments. Score: 2.5

The labor unions observed that the

10. Dismantle rice cartel. No concrete result has been reported in this regard. Score: 2.5

11. Halt land reform program. As cited earlier in this paper, no law has been passed to stop the agrarian reform program. Score: 2.5

12. Distribute the coco levy to farmers. This promise has not yet been done. Score: 2.5

13. Open health facilities in every barangay with a health doctor. This promise is far from accomplished. The DOH Secretary said that the Philippines has a ratio of one doctor for every 33,000 persons and is short of 15,000 doctors to adequately meet the health needs of Filipinos

10 http://cnnphilippines.com/news/2016/05/24/Duterte-Arroyo-pardon-plunder.html

every year. The WHO standard is 1 doctor for every 20,000 persons. The DOF has a “Doctors to the barrios “program with 398 posts but 116 of these post have remained vacant. 11 Score: 2.5

14. Promote family planning to prevent over population. In his first state of the National Address, the President stated his support of the full implementation of the reproductive health law. He signed an Executive Order that will give Filipino families full access to the type of commodities and services to realize the size and spacing of children that they need. 12 Score: 7.5

15. Lay claim to the nearest Chinese occupied land. In a press briefing in April, the President, announced that he had ordered the military to occupy areas in the South China Sea: “I have ordered the Armed Forces to occupy all the so many islands, I think 9 or 10. Lagyan ng structures (Build structures) and the Philippine flag.” But apparently, 9 islands had been under Philippine control, 8 of them since the 1970s, and the last one since 1999, each of the features hoists a Philippine flag and various structures have been erected, the most extensive of which are in Pag-asa, the most populated island in the municipality of Kalayaan in Palawan. In her article, Marites Vitug asks,” What happened here? It is hard to find any explanation other than that Duterte didn’t get it.” 13 Score: 2.5

16. Put a stop to the big mining companies in Mindanao. Former Secretary Gina Lopez closed three mining firms including the Tampakan gold and copper project in South Cotobato. She also cancelled 75 mining contracts. But Sec, Lopez’ appointment was rejected by the Commission on Appointments. Former AFP Chief of Staff Cimatu was appointed to replace her. It was reported that the new DENR Secretary lifted a restriction on issuing environmental permits, including

those for mine exploration and development, reversing an order by his predecessor. Cimatu also cancelled an order that gave the DENR Secretary sole authority to issue

environmental permits. The power will again be shared with the Environmental Management

Bureau, an agency under

Score: 2.5

Secretary

his office. 14

17. Solve traffic problems in Manila. The administration is facing reality that the traffic problem cannot be solved in 6-months time. Score: 2.5

18. Hike infrastructure spending up to 7% of GDP. The administration has laid out its “Build, Build, Build” program, many of the projects were begun by the Aquino administration. But, government has been undespending 15 in 2016 and in the first quarter of 2017 as earlier cited in this report.

11 http://www.gmanetwork.com/news/lifestyle/healthandwellness/580192/phl-needs-p57b-and-35-000-

doctors-to-copy-cuba-s-healthcare-system-doh-chief-says/story/

12 http://www.rappler.com/nation/157999-duterte-signs-eo-family-planning-reproductive-health-law

13 http://www.rappler.com/thought-leaders/173311-duterte-one-year-autocracy-incompetence

14 http://marketintelligence.spglobal.com/our-thinking/news/philippines-new-environment-minister-lifts-

embargo-on-environmental-permits

Score: 5 19. Build new railways throughout the country. Building railways is part of the “Build, build. Build program of government but this promise will take quite a long time to fulfil. Score: 2.5

Average score: 3.9

Health Sector Assessment

Comparing the milestones reached in the past year and the progress made in the health sector vis-à-vis the existing gaps in implementation, here are our scores:

PLATFORM

SCORE

1. Financial risk protection through universal health insurance

6

2. Better health outcomes in all life stages by addressing the

6

triple burden of disease

3.

Responsiveness through the creation of service delivery

3

networks

Total Score

15

Average Score

5

MGG notes that AmBisyon Natin 2040 is an excellent platform to achieve the sustainable development goals (SDGs). However, a lot of action needs to be taken for real change to be felt. Although the capacities of rehabilitation and treatment centers have doubled with additional training given to frontline health workers, the war on drugs has resulted to a loss of 7,000 lives mostly urban poor Filipinos. Construction of health care facilities and rehabilitation centers has been slow, despite the additional P 96.366 billion allocated to DOH. Financial risk protection is still not experienced by all Filipinos with approximately 8 million Filipinos who still outside PhilHealth, despite the additional P3.0 billion pesos given to its budget. The PhilHealth TseKap program has been instrumental in providing basic health services to 20 million Filipinos but the challenge now is how to sustain efforts on promoting preventive medicine rather than curative medicine, given our country’s problem of triple burden of

disease. Finally, the lack of clear guidance from DOH on what a service delivery network is, and how it can be successfully implemented is an impediment to the progress that is being undertaken by the department. Several tools to enable SDNs, such as telehealth/telemedicine, are available for use and implementation. Without a department administrative or memorandum order, on how to integrate and make full use of these tools for SDN creation can result to a disorganized effort. The long-standing dearth of health human resources – coupled by the assassination of four physicians serving in the provinces in the first year of the Duterte administration ,contribute to the challenge of achieving SDNs. Instituting a return of service for all health professional graduates (physicians, nurses, pharmacists, physical therapists, occupational therapists, etc.) of state universities and colleges and distributing them to their provinces of origin or areas of need offer an excellent way of resolving this challenge. But this must be complemented by a well-designed security and safety plan for all health personnel in the country.

Annex A- Excerpts from

“The year of living with autocracy and incompetence 16

By MARITES DAÑGUILAN VITUG

Published 11:00 AM, June 20, 2017

What institutions?

His first year in office shows that Duterte’s experience as mayor is vastly out of proportion to the demands of the presidency. And it has ill-prepared him for the checks and balances that are central to a democracy.

Shaped by decades of ruling Davao as the uncontested mayor, he has little regard for co-equal bodies. Remember that he threatened to declare martial law when the Supreme Court chief justice, Maria Lourdes Sereno, cautioned him on his unrelenting drug war.

16 http://www.rappler.com/thought-leaders/173311-duterte-one-year-autocracy-incompetence

And woe to any institution or person who challenges his views. He fired the head of the Dangerous Drugs Board for sticking to a lower figure of drug users, 1.8 million, which is based on a 2016 scientific survey, in contrast to Duterte’s 4 million, taken out of thin air. He calls his critics names and is unable to engage in a civilized debate – “Daldal ng daldal…wala namang ginawa… (He keeps yakking but he hasn’t done anything)” is how he responded to Justice Antonio Carpio’s push to assert Philippine sovereignty over islands in our exclusive economic zone.

What is most disturbing, so far, is that he has used the power of the state to send a critic to jail on feeble charges. It’s been about 4 months since Senator Leila de Lima has been detained.

Duterte believes he is often right, disregarding consulting with his Cabinet members on vital issues ranging from the declaration of martial law – he made the decision without meeting with his defense secretary – to mining policy. The President did not convene his socio-economic team to provide strategic direction in this crucial sector. It was only after Environment Secretary Gina Lopez suspended operations of several mining companies, creating an uproar in the industry, did the Cabinet meet to clarify the policy.

Simple solutions are his responses to complex problems, like the magic wand of martial law and killing of drug users, thinking that these will make the problems go away. He still hasn’t caught up with the scale of ruling a country, unimaginably far from the “kanto-kanto” (his words) of Davao he used to patrol on motorbike at dark.

Drugs and disputed islands

Take the drug war, his centerpiece program. Despite evidence showing that curbing drug abuse is not simply a matter of using force but is tied to social issues, Duterte has continued with his policy to exterminate users. He is unable to link drugs to poverty and the feeling of exclusion, poor governance, and unresponsive public health programs.

In foreign policy, he shows a similar limited understanding of the issues. For example, after the boost given by the country’s overwhelming victory over China in July 2016, Duterte sees war with our giant neighbor as the only way to enforce the ruling. He has repeatedly said that the Philippines cannot afford to go to war with China, dismissing outright peaceful avenues.

As experts have pointed out, there are a number of diplomatic options in the President’s arsenal, including strengthening alliances with claimant countries as well as allies to put pressure on China and creating a marine park in parts of the South China Sea to preserve the fishery resources and protect the environment.

Maute and Marawi

Duterte’s narrow mindset came to the fore again when he said the root of the crisis in Marawi, where Maute violently seized parts of the city, was the drug money boosting the criminal group. “…Ang puno’t dulo diyan is droga kasi diyan ang hotbed ng shabu pati drug sa Mindanao (This is rooted in drugs because Mindanao is the hotbed of shabu),” he told soldiers in Sulu.

While this may be partly true, the problem is not one-dimensional. Systemic problems, such as weak governance, poverty, and dysfunctional courts and prisons, have made groups like Maute thrive.

Duterte’s solution was to declare martial law in Mindanao. Again, this is only one tool in his kit. Will it fix the problem of terrorism? The country’s experience – 14 years of martial law under President Ferdinand Marcos and one week of martial law in Maguindanao under President Gloria Arroyo – has shown that it will not. Till today, we’re still living with a communist insurgency, a Muslim rebellion, terrorism, and lawlessness and feudal politics.

From the drug war to foreign policy to terrorism, Duterte wings it, propped up by his aggressive propaganda campaign on social media and elsewhere. This PR machine – plus the survey ratings that show him still enjoying public support – may lull him into a false sense of complacency. Past surveys show, though, that presidents usually get good ratings in their first year in office as the populace unites behind them.

Will this last? It will be largely up to the President and the people. – Rappler.com