Watchdogs: Aquino failed to improve lives of Pinoys

Social watchdogs said the outgoing administration failed to improve the lives of Filipinos despite the strong economic growth posted during President Aquino’s term that averaged above 6 percent yearly.

The Freedom from Debt Coalition (FDC) said the economic growth benefited only a small segment of the economy.

“The shameless trumpeting by the Aquino administration of an economic growth that benefits only the rich and propertied segment of society is an outrage,” the (FDC) said.

The think tank IBON, meanwhile, said the high election-boosted economic growth of 6.9 percent was “overstated as a sign of economic success.”

“Economic growth is important but should not be used to divert public attention from fundamental problems of chronic joblessness and poverty,” the group said.

The Philippines economy’s reported 6.9-percent growth in gross domestic product (GDP) in the first quarter was said to be the “fastest in Asia,” apparently outpacing even other major Asian economies such as China (6.7 percent), Vietnam (5.5 percent), Indonesia (4.9 percent) and Malaysia (4.2 percent). The government said this proved that the Philippines has “strong economic fundamentals.”

FDC President Ed Tadem said economic growth, as measured by GDP has, indeed, grown under Aquino but that that growth “pales in comparison to the continuing high poverty levels, joblessness and rising income inequality, the P6.4-trillion public debt to be inherited by the next administration, and the billions of pesos wasted in payments for fraudulent, wasteful and questionable loans.”

Tadem cited the Social Weather Stations’s report that 50 percent of Filipinos (11.2 million families) rated themselves as poor as of December 2015, while the joblessness average for 2015 was 21.9 percent.

He added that within the Association of Southeast Asian Nations (Asean), the Philippines, as of 2013, registered the second-highest income inequality ratio based on the Gini coefficient index.

The 50 richest Filipinos’ net worth of $74 billion in 2014 was “a staggering 26 percent of the country’s GDP,” Tadem noted. “Three families alone—Sy, Ayala, and Aboitiz —share a combined wealth equivalent to 12 percent of the Philippine economy.”

Tadem also scored the Aquino administration’s failure to arrest the growth of the government’s social debt, which is defined as the government’s “unfulfilled obligations to its citizens,” which could be approximated from its commitments, as stated in the Constitution and laws, the socio-economic targets set by all previous development programs and plans, and standards set by the United Nations and international covenants of which the Philippines is a signatory.

Budgetary allocation for education still falls below the 6-percent GNP minimum investment recommended by the Fifth International Conference on Adult Education organized by Unesco and affirmed by the Belem Framework for Action (Confintea VI) signed by the Philippines. Using this as a measurement, the FDC’s computation of Mr. Aquino’s social debt in the education sector alone is already P2.5 trillion.

The government’s growing social debt is largely due to the prioritization of debt servicing for loans including those that did not benefit the people, Tadem added.

Since the time of President Ferdinand E. Marcos, when automatic appropriations for debt servicing became a law, debt payments have taken the first cut in the national budget before appropriations are made for vital social services.

“The Aquino administration’s pompous claims of its economic achievements do not appease the hungry stomachs of those whose lives were neglected by economic activities that only catered to the interest of a few. There is nothing to brag about an economic growth that leaves most people behind,” Tadem said.

Worst joblessness incidence

IBON added the Philippines still has the worst unemployment in Asia. The latest labor force survey (LFS) data had the official unemployment in the country at 5.8 percent in January 2016. The latest available data from slower-growing Asian economies showed lower unemployment rates; for instance: China (4.0 percent), Vietnam (2.3 percent), Indonesia (5.5 percent), Malaysia (3.5 percent), and Thailand (1.0 percent). According to IBON, the fact that slower-growing economies could have lower unemployment rates underscores how growth is a convenient but often misleading indicator of development.

The group reiterated that the official unemployment figures do not even capture the true extent of joblessness in the Philippines.

It said the government “revised the definition of joblessness to artificially lower the unemployment count by some 1.5 million and the unemployment rate by some 3.5 percentage points.”

There is also a rapidly rising number of underemployed and discouraged workers, IBON noted.

The latest January jobs data showed employment increasing from 38.4 million in January 2015 to 39.2 million in January 2016, while the number of unemployed supposedly fell from 2.7 million to 2.4 million in the same period.

Yet, the number of underemployed Filipinos, or those working but looking for additional work and income, drastically increased by 847,000 to reach 7.7 million in January 2016, from the same period the year before. The underemployment rate correspondingly grew to 19.7 percent last January, from 17.9 percent last year.

Meanwhile, the labor force participation rate (LFPR), which measures the share of the working-age population working or looking for work, has fallen to “crisis levels.” The 63.4-percent LFPR in January 2016 was practically as low as the 63.3-percent rate in January 2009 or right after the 2008 global financial crisis. It is also already the lowest in over 30 years since averaging just 62.9 percent annually during the 1981-1985 economic crisis in the closing years of the Marcos dictatorship, the figures showed.

IBON added that the working-age population grew by 1.1 million in January 2016 from the year before but the labor force only grew by a much smaller 487,000.

These results are consistent with the growing numbers of discouraged workers that, in effect, lowers unemployment figures. Unemployed workers are dropping out of the labor force or potential new participants are not bothering to join the labor force, or both, IBON said.