SONA 2012: REVIEWING NOY AQUINO'S "SOCIAL
CONTRACT"
[PHOTO -
ON JOB CREATION: Aquino promised "inclusive growth" that
creates jobs at home. After two years, his administration has turned out to be
the largest exporter of Filipino workers (Photo from
inquirer.net)]
MANILA, JULY 3, 2012 (PHNO BLOG WATCH)
On June 30, President Benigno Aquino III will mark his second year in
office.
Then on July 23, he will deliver his third State of the Nation Address
(Sona).
How do we assess his performance so far?
One approach is to gauge Aquino's achievements vis-à-vis the promises he made
to the people in 2010.
This series of articles reviews the performance of the President in terms of
his campaign promises on improving the economy and the living condition of the
people.
Promises
As reference, we will use the document "A Social Contract with the Filipino
People".
In this document, then presidential bet Aquino outlined his platform of
government. We will also refer to the Philippine Development Plan (PDP)
2011-2016, which details how Aquino plans to implement his so-called Social
Contract.
Among others, Aquino promised to transform national leadership:
1. From a government that merely conjures economic growth statistics that our
people know to be unreal to a government that prioritizes jobs that empower the
people and provide them with opportunities to rise above poverty
2. From
relegating education to just one of many concerns to making education the
central strategy for investing in our people, reducing poverty and building
national competitiveness
3. From treating health as just another area for political patronage to
recognizing the advancement and protection of public health, which includes
responsible parenthood, as key measures of good governance
4. From government policies influenced by well-connected private interests to
a leadership that executes all the laws of the land with impartiality and
decisiveness
5. From treating the rural economy as just a source of problems to
recognizing farms and rural enterprises as vital to achieving food security and
more equitable economic growth, worthy of reinvestment for sustained
productivity
6. From government anti-poverty programs that instill a dole-out mentality to
well-considered programs that build capacity and create opportunity among the
poor and the marginalized in the country
7. From a government that dampens private initiative and enterprise to a
government that creates conditions conducive to the growth and competitiveness
of private businesses, big, medium and small
8. From a government that treats its people as an export commodity and a
means to earn foreign exchange, disregarding the social cost to Filipino
families to a government that creates jobs at home, so that working abroad will
be a choice rather than a necessity; and when its citizens do choose to become
OFWs, their welfare and protection will be the government's priority
These Social Contract commitments can be categorized into five:
(1) Job creation;
(2) Provision of social services;
(3) Poverty reduction;
(4) Agricultural development; and
(5) Promotion of private business.
New jobs
Aquino criticized the Arroyo administration for conjuring false growth
statistics.
In his PDP, Aquino said that his government will aim for inclusive growth.
This means economic expansion which translates to more jobs. The PDP has
specifically set a target of one million new jobs every year, based on an annual
growth of 7-8% in the gross domestic product (GDP).
Using official data from the National Statistics Office (NSO), the average
number of jobs in 2010 was about 36 million.
It increased to 37.2 million in 2011 and to 37.6 million this year.
Aquino, thus, has "created" around 1.6 million new jobs or 800,000 a year.
This seems impressive considering that the GDP grew by an average of just 4.5% a
year during the period.
But the additional jobs are negated by the increase in the size of the labor
force.
From 2010 to 2012, the labor force grew by 1.6 million, the same volume as
the increase in the number of jobs.
Hence, official unemployment did not improve during the period, remaining at
more than 7 percent.
Dismal quality
Further, the quality of additional jobs remained dismal.
Of the 1.6 million new jobs, more than 800,000 were produced by the services
sector, characterized by highly irregular, less productive employment. They
include jobs covered by "endo" (end of contract) and "5-5-5" schemes, where
workers are hired under rotating 5-month contracts.
Aquino has rejected proposals to fully ban contractualization, along with the
₱125 wage hike bill, claiming they will create "more problems".
Also, more than 500,000 of the new jobs were self-employed and unpaid family
workers. This implies that almost a third of jobs created were a result of
workers' own efforts to cope with limited employment opportunities.
Meanwhile, underemployment, which captures the unsatisfactory quality of
present jobs, increased by about 149,000 from 2010 to 2012. Estimates
Of course, it could be argued that low quality jobs are better than no jobs
at all.
But what Aquino promised are new jobs that empower the people and give them
the chance to get out of poverty.
To be sure, part-time, insecure or unpaid jobs do not allow workers to be
productive enough and improve their miserable condition. Worse, jobs being
created are not only low quality but also insufficient in relation to the
burgeoning labor force.
Flawed count
It does not help that NSO data on employment tend to understate domestic job
scarcity.
Official methodology counts as employed those who "worked" for even just one
hour in a week, which artificially bloats the number of employed.
On the other hand, it excludes as unemployed the job seekers who are
unavailable for work despite an opportunity due to illness, family obligations,
etc. This falsely deflates the number of jobless.
Aquino is aware of this anomaly.
In one of his press briefings prior to official proclamation, he said one of
the first things he will do is to clarify how government counts the jobless.
This, according to Aquino, will let government design a more reliable
employment program.
Alas, Aquino chose to continue the unreliable NSO methodology began by the
Arroyo administration in 2005 in an obvious attempt to hide the worsening jobs
crisis.
Deteriorating crisis
Fortunately, independent surveys, such as the one regularly conducted by the
Social Weather Stations (SWS), provide us a more dependable picture of the
domestic labor market.
In its latest (March 2012) survey on adult unemployment, the SWS reported
that 34.4%, or about 13.8 million workers, are jobless.
Using SWS surveys, it appears that the incidence of unemployment is worst
under Aquino, averaging 26.8% in his first two years.
During the term of Gloria Arroyo, it averaged 19.6%; Joseph Estrada, 9.2%
and; Fidel Ramos, 10.3 percent. Unemployment is on its way to triple its level
from just two decades ago.
The current jobs crisis is the result of the accumulated impact of decades of
defective and destructive economic programs implemented by previous regimes such
as trade and investment liberalization, neoliberal restructuring of agriculture,
etc.
Aquino is not expected to fully reverse this long-term trend of deteriorating
job scarcity in two years.
But instead of laying down the groundwork to address the jobs crisis such as
reviewing and scrapping laws that liberalized key sectors of the economy, it's
business as usual under the Aquino administration.
No industrialization plan
Export-oriented, foreign capital-dependent industries that are vulnerable to
global boom and bust continue to be promoted under the PDP 2011-2016.
Local micro, small and medium enterprises (MSMEs), which account for around
61% of employment, remain marginalized as policies continue to favor big and
foreign corporations.
There is no plan to reverse trade and investment liberalization that
destroyed local industries and jobs, especially MSMEs. There is no
industrialization plan anchored on vibrant domestic production and consumption.
MSME development is still geared towards linking them to the highly volatile
foreign markets and as subcontractors of mostly foreign firms. Thus, the
potential of MSMEs to massively and sustainably contribute to domestic job
creation remains greatly hampered.
Also, Aquino does not have a genuine land reform agenda, which is another
program that can create a huge number of jobs. Instead, he has been promoting
public-private partnership (PPP) in agriculture that tends to displace farmers
and farm workers, while peddling the deception of the Comprehensive Agrarian
Reform Program Extenstion with Reforms (Carper). (More on this in a separate
article.)
Largest exporter of workers
Indeed, this administration does not have a comprehensive and sustainable job
creation plan to speak of. Contrary to the Social Contract's pronouncement that
it will create jobs at home and will not treat our workers as export
commodities, Aquino has turned out to be the largest exporter of Filipino
workers among all Presidents.
In the past two years, Aquino has aggressively pursued new bilateral deals
with various countries to create additional market for Philippine labor export.
It has recently lifted the deployment ban in politically turbulent countries
like Libya, Sudan and Nigeria as well as in Iraq and Afghanistan.
Data from the Philippine Overseas Employment Administration (POEA) show that
the deployment of overseas Filipino workers (OFWs) under Aquino has already
reached around 1.4 million a year.
During Arroyo's time, annual deployment was pegged at 1 million; Estrada,
0.84 million; Ramos, 0.69 million; and Cory Aquino, 0.47 million.
OFW deployment has already almost tripled since the administration of
Aquino's mother.
Neglecting OFW welfare
Worse, Aquino has been remiss even in his commitment to ensure the welfare
and protection of OFWs.
Migrante International noted in a report that the 2012 budget for OFW welfare
and services has been cut by ₱792 million.
Per OFW, the Aquino administration is allocating a measly ₱262 for welfare
and services. Meanwhile, it is collecting a huge ₱20,000 from each OFW for
various fees and taxes.
Aquino's neglect of migrant workers is further illustrated in the inept
evacuation of OFWs from MENA (Middle East and North Africa) countries undergoing
political turmoil, not to mention the four Filipinos executed abroad in the past
two years.
FROM FRANCISCO 'KIT' TATAD BLOG
PNoy's "PURSUING OUR SOCIAL CONTRACT": Clustering The Cabinet
[PHOTO - FRANCISCO 'KIT' TATAD]
On May 13, President Noynoy Aquino issued Executive Order No. 43, "Pursuing
Our Social Contract with the Filipino People Through the Reorganization of the
Cabinet Clusters."
The Cabinet needs to be organized thematically into smaller groups, or
clusters, to achieve "efficiency, effectiveness and focus," the EO says. 4.
There are five clusters: 1. Good Governance and Anti-Corruption,
chaired by the President; 2. Human Development and Poverty Reduction,
chaired by the Department of Social Welfare and Development Secretary; 3.
Economic Development, chaired by the Finance Secretary; 4. Security,
Justice and Peace, chaired by the Executive Secretary; and 5. Climate
Change Adaptation and Mitigation, chaired by the Secretary of Environment and
Natural Resources.
The idea is laudable.
Clustering will allow Departments with the same or closely related concerns
to work closely together in-between Cabinet meetings, which should take place
regularly once a week, as in most governments. There is the danger, though, that
the clusters could try to replace the Cabinet itself, and do away with the
regular Cabinet meetings. This should not happen. The Cabinet should always
function in full, under the control of the President.
Making the President chair one cluster, no matter how important that cluster
may be, effectively downgrades the President to the position of a mere Cabinet
member. It effectively reduces the Cabinet to that one cluster chaired by the
President or raises that particular cluster to the level of the entire Cabinet,
at the expense of the other clusters. That can and should be avoided.
Each cluster should be chaired by the Cabinet member with immediate
jurisdiction over the cluster's primary area of responsibility. Its members
should be ranked according to their respective jurisdictions and the Order of
Precedence followed when listing Cabinet members. This seemingly unimportant
detail is not trivial at all.
For instance, the Secretary of Justice and the Secretary of Finance should
have precedence over the Budget Secretary in the listing of members of the Good
Governance and Anti-Corruption Cluster. Likewise, the Secretaries of
Agriculture, Energy, Science and Technology and Tourism, given their inherent
responsibilities, should have due precedence in the Economic Development
Cluster.
The DSWD Secretary may have a broader responsibility than the Chair of
Housing and Urban Development Coordinating Council (HUDCC) for Human Development
and Poverty Reduction, given her control of, among other things, the P21.9
billion conditional cash transfer, which is supposed to be an anti-poverty fund.
But since the HUDCC Chair happens to be the Vice President --- the second
highest ranking official of the country and the only nationally elected official
sitting in the Cabinet---he cannot be made to sit under the DSWD Chair without
doing offense to the dignity of the State. The DSWD Secretary could co-chair the
cluster of the Vice President.
The Security, Justice and Peace Cluster has, as its primary responsibility,
"the protection of our national territory and boundaries." This should be
chaired by the Secretary of Foreign Affairs, possibly with the Secretary of
National Defense as co-chair.
The Executive Secretary performs a highly critical function for the
President. He should be represented in all clusters so that he could monitor,
coordinate and digest all developments for the President, without having to wait
for the regular Cabinet meeting, which should never be dispensed with at all.
A particular Department or Cluster may take the lead in proposing or
implementing a particular course of action on any given question. But a Cabinet
decision is always made by the Cabinet in formal Cabinet meetings. A government
can repeal or rewrite this process only at its own peril.
Chief News Editor: Sol Jose Vanzi
© Copyright, 2012 by PHILIPPINE HEADLINE NEWS ONLINE
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