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    The Missing Solutions

    31 August 2016

    Message at the Brewing@AIM, Asian Institute of Management, Makati City

    On the day I assumed my post as Vice President, I made a promise to the Filipino people. My office would be a listening office.

    We would go to the smallest, far-thest, poorest barangays during our first 100 days and during the entire 6 years of my term. We would put the people in the fringes of society at the front and center of our programs, not just as beneficiaries but as partners in development.

    So, since that day, June 30 this year, we’ve been spending half of every week meeting with organizations and individuals who want to be part of our work in poverty alleviation.

    The other half of the week, we trade our dresses and pumps for slippers and jeans to walk the muddy or dusty paths to where our people in the farthest communities live.

    If you have worked among those at the grassroots, you will know that people empowerment and people participation are not happy fieldtrips and photo-ops. They are not let’s-talk-and-drink-some-beer affairs.

    Many times they are tense situations, humid and tiring, with no bathrooms in sight for kilometers. There, we meet people who are angry, hungry, and desperate. Their fatigue created by their lack of opportunity is way more potent than your exasperation with traffic.

    For sure, there has been economic growth and significant gains in the last 10 years, even more. The numbers show it. Just two weeks ago, our 7% expansion in gross domestic product has allowed the Philippines once again to outshine its neighbors. Our growth rate was better even than China’s 6.9%.

    Sustaining this growth rate will be more difficult.

    One of the factors that will affect our economic sustainability is inequality. Inequality not only prevents us from sustaining a higher GDP, it drags down growth. OECD numbers show that in Mexico and New Zealand, rising inequality took away 10 percentage points off their growth rates.

    In the Philippines, the richest 20% of the Philippine population received 52% of the country’s total income in 1994, nearly 11 times the share received by the poorest 20%. In 2009, the poorest 20% of the popu-lation accounted for just 4.45% of national income.

    While some level of inequality is important for free markets to flourish, clearly our current level of inequality has become an intractable problem that government alone cannot solve. The business sector should be part of the solution and the why is clear. One: topline growth has put us up on the global map; making sure the benefits of this growth is felt by all will keep us there.

    Two: inclusive growth is not only critical for those in the fringes of society that we have vowed to serve, but also for your businesses to grow sustainably. Building nations where everyone can live and thrive and enjoy the benefits of economic growth is the best way to create more growth.

    The next logical question is how? And how can we work together to reach this goal? Our office, the Office of the Vice President is committed to changing the face of poverty in the next six years by focusing on five key advocacy areas: hunger and food security, universal health care, rural development, education, and women economic empowerment. On top of these, as HUDCC chairperson, we also need to address the housing problem. Let me go briefly through the six areas.

    First: Housing. From 2011 to 2016, the total housing backlog could reach 5.7 million. We need to build 2,602 houses per day in the next six years if we are to reduce this backlog to zero. To state the obvious: The housing problem is urgent, huge, and difficult.

    We must work fast, but never in the wrong direction. That is why a comprehensive road map is critical to our success. The only way to succeed is to partner with the private sector, but we are not asking for your charity.

    Companies like Phinma Properties have proven that these developments can be commercially viable. In the past, ISFs would pay anywhere from P1,500 – P3500 a month to dwell in a 10 sqm space with no proper sewer-age and drainage system.

    Through Phinma’s partnership with the Quezon City government, Pag-ibig Fund and several partner NGOs, ISFs today shell out only a little bit more than P2,000 as monthly amortization through Pag-Ibig for decent 26 sqm homes with loft provisions that have proper sewerage, drainage, and security of tenure.

    We have also recently reduced the documentary requirements for socialized housing projects under High Density Housing and the Community Mortgage Program to nine from the previous 27 to reduce processing time, cost, and risk of “illegal facilitation fees”.

    If you’ve seen the list of requirements, you will understand me when I say “it is not for the faint-hearted.” There is no reason why our people have to wait if we can deliver basic services faster.

    We will see to it that processing time goes down to 15-30 days from two years. Our memorandum of agreement with the Bureau of Internal Revenue to be finalized in the coming week will also lessen the processing time further.

    Again, the shelter problem, is a multifaceted issue that requires multi-dimentional solutions. As we went around resettlement sites, one thing became clear. The soutions of the past no longer work. We will have to revolutionize our approach to finally solve our shelter problem. We must not look at this as simply a matter of building houses. We also need to think about livelihood in resettlement areas, public safety, access to water and electricity, public libraries and community playgrounds, among other things.

    Second: Public health and hunger. These two items are very intertwined, so I will discuss them together. We are focusing on maternal health and the widespread stunt-ing of Filipino children. We believe that this is a silent crisis that is not given due attention at the moment.

    That this is not just a public health issue but an economic is-sue is something that I hope you will all agree with today. Based on the National Nutrition Survey of 2015, 33.6% or 3.5 million Filipino children are suffering from stunting. That does not just mean they are small, physically. Their neurological development is also slow, so in 15 years, a huge swath of the population will enter the labor force unable to do the jobs you want them to do.

    Based on our multi-stakeholder consultations so far, the solutions we are looking at will focus on improving the nutritional intake of children in the first 1,000 days.

    This should begin from womb to at least two years of age, meaning we will also work on the nutrition of pregnant mothers. We hope to strengthen existing government programs on this by improving coordination within government, and between government, civic organizations, and the private sector, and going into capacity building trainings for front liners in the local communities.

    When we say coordination, that’s not a fluffy term for sending text messages and calling. We refer, for instance, to creating an information management systems tool that will record which are the families at risk in a particular community and what will be their expected needs.

    This way, our local government units and health workers can respond proactively rather than reactively which is what is happening now.

    We have created an information management system like this successfully with Seaoil Foundation in the third district of Camarines Sur which I represented at the 16th Congress. At that time, our program was for indigent senior citizens. We will be replicating the same thing in our public health programs now that I’m Vice President.

    From the Zuellig Foundation, our learning is that when the local government unit has buy-in, when they are involved in the planning and roll-out, the programs have a higher chance of succeeding.

    Third: rural development and food security. Last week, I was in the coastal communities in Province Quezon and I am happy to note that in one particular town in Alabat, a coastal town, their businesses are thriving because of the local government’s support in terms of facilities, equipment, and financing tie-ups.

    This proves that with a little capital, knowhow, and access to markets, small-holder farmers can be very good entrepreneurs. So we believe that impact investing and inclusive agribusiness can massively address poverty in our countryside. Jol-libee Foundation uses an interesting business model, I don’t know if you’re familiar with it, that creates clusters of small farming communities and provides them with training on how to meet its strict supplier specifications.

    They have a very successful agribusiness farm already in Nueva Ecija, where farmers raising onions are being helped by the Jollibee Foundation. The farming communities are thus transformed into successful entrepreneurs. You can refine your business models so that you can also include microentrepeneurs in your value chains.

    Fourth: Education. Since we are in a transition year, we would like to focus our efforts on complementing existing efforts for the senior high school program. We are looking at hard infrastructure needs like schools and laboratories, as well as mechanisms to guide students on the tracks that they need to take in K-12.

    We expect the first batch of senior high schools to graduate in 2018, and so we have a year and half before they enter the labor force if they so wish. Related to this, we are a bit concerned that the number one track chosen by high school students now is baking.

    We are not sure just how many bakeshops can accommodate our graduates! There is a disconnect between the competencies developed by our labor force and jobs demanded by our graduates.

    As an aside, I was telling you a while ago that I was in Bulacan yesterday. And during an open forum with the residents of the relocatees there, one very young guy went to the microphone and expressed his dismay about the fact that very many of them are graduates of college but there is a very big disconnect where employment is concerned. He was complaining that many of them are underemployed. This is one thing we can be of help.

    That is why we want to create a database of existing and prospective jobs that the private sector will be needing in the next two to three years.

    This will result in evidence-based decision-making in career and curriculum planning, and allow better skills and job matching in our economy. With the help of the private sector and local government units, such a database, if created on a national level, can also smoothen development between Metro Manila and other cities by pointing our graduates to where their skills are needed most.

    Fifth: Women empowerment. We are specifically looking at women economic empowerment by providing women with livelihood trainings, mentoring, linkages to microfinancing, and access to market.

    We know that even women who have been victims of domestic abuse can stand on their own when they have a source of income. We have seen many of these during our work in the third district of Camarines Sur when I was a congresswoman and my many years as an alternative lawyer with a particular NGO Group called Saligan where I was lawyering a lot for abused women.

    During the consultations we have had with different stakeholders in the last two months, we have seen three things that cut across all of these six areas.

    First is the need for communities’ voices to be heard and making sure that we are not here to tell them what they need, but to listen and find out what assistance they need. Se-cond is the role of local government. Without any exception, all interventions are more effective when the local government has buy in and is very much involved from planning to monitoring to execution to evaluation.

    Third are metrics. We must not measure activities but rather outcomes. You know, I’m telling you this when I was evaluating the past accomplishments of the housing sector the accomplishments given to me were numbers of houses built, number of trainings given. I was telling my staff, those are not accomplishments, those are pro-grams. Accomplishments are the effects of those programs.

    As I’ve said, we have to stop counting the number of children fed, because you know when we were conducting these roundtable discussions, we discovered that there were so many foundations involved in feeding programs. But most of the feeding programs out there are not really concerned about metrics.

    They are more concerned about the number of children fed and we are trying to change that mindset already. We’re trying to inculcate a different kind of mindset, and happily most of the organizations already involved in feeding involved are very open to changing the mindsets, that the real measure is how many children were taken out of malnutrition, how many children were taken out of hunger.

    We cannot measure our success by counting houses built for the poor, when these houses are not liveable for lack of access to water, electricity, market, schools, churches. We must use the right metrics that revolve around quality of life. I know I have said a lot, but believe me we are just beginning.

    We are still at the listening and environmental scanning stage. But I hope that these preliminary ideas will spark some of your own. And most of you would al-so be willing to partner with us.

    Please know that we are open to your ideas. Tell us what you are already doing and how you have been successful in doing them because we want to learn from your experiences. We do not want to waste our time reinventing the wheel, when your flying spacecrafts may already be taking you to Mars.

    In October, we will have a partners summit and we will have something more definite for all of you by then. Just to give you an idea, Mondays to Thursdays, we’ve been meeting with several groups, I don’t know if some of you have attended already but we’re really doing this on an overtime basis.

    Fridays to Sundays, we call them our laylayan days, these are the days we go to the most far flung barangays.

    I remember my first weekend in my work as Vice President, I was in Lanao del Sur, Lanao del Norte. We have been to the relocation sites in Laguna, as I said earlier, I have been to coastal communities in Quezon.

    I was in Tarlac, last week, I was in Bulacan yesterday, it was an exemption to the rule, because Bulacan was celebrating its Marcelo del Pilar day so I went but I also took advantage to visit the many relocation sites there and listen to the many horror stories of the many problems besetting not only the local government units but also the relocatees.

    Anyway, my time in government is limited. I’m here only for the next six years and I only have six years to do all I want to do.

    Your time in the private sector is much long-er and your resources are infinitely much bigger than ours. If we work together, I am positive that the synergy we will create can bring our economy to heights we have never seen before—but only if our poor are included in the picture.

    My hope this morning is after today, we wish that we would be able to invite many of you to partner with us.

    As you may know, the Office of the Vice President has very limited budget. Our budget is just for personnel and for ceremonial duties.

    So we are really banking on the private sector for us to accomplish everything we want to accomplish in the next six years.

    And six years is too short for us so we’re really hoping we’ll be able to get active partners from all of you.

    Thank you very much for this opportunity to speak before you, magandang umaga muli sa inyong lahat.

    Posted in Speeches on Aug 31, 2016