Fiscal issues, SONA 2011

SONA 2011: Making sense of Aquino’s facts and figures (part 2)

Aquino missed in his SONA the facts and figures that matter to the people (Photo from

Continued from part 1

Aquino also claimed that in his first year as President, the Philippines got upgraded four times by credit rating agencies. Compare this, said Aquino, to the lone credit upgrade and six downgrades the country had in the nine and a half years of the Arroyo administration. A high credit rating means lower interest payments. According to Aquino, the country spent P23 billion less in interest payments from January to April 2011 compared to the same period last year. This amount can supposedly already cover the 2.3 million families in target beneficiaries of the CCT program until the end of the year.

Debt servicing

A credit rating is simply the measure of the credit worthiness of government. Credit worthiness, meanwhile, pertains to the ability of government to repay its debt obligations. A high or favorable credit rating indicates that there is less or no risk of defaulting on our loans. Thus, creditors are more willing to lend with lower interest rates and therefore “less” debt burden for the borrower.

But the credit rating upgrades came at a high cost for the people. To obtain the upgrades, the Aquino administration ensured that debt obligations are being paid dutifully and at the same time resorted to massive under-spending. The result is that an ever increasing portion of spending by the national government went to debt servicing. Since Aquino became President, total debt servicing has already reached P668.65 billion (from July 2010 to May 2011). Until April this year, 49.3 percent of what the Aquino administration has spent went to debt servicing.

Worse than Arroyo

Compare these figures to those under Arroyo, who has been criticized as a heavy borrower and payer. Monthly debt servicing during the Arroyo administration was P48.18 billion while in the first 11 months of the Aquino presidency, it went up to P60.79 billion.  As a percentage of total government spending (including principal payments), the average during the Arroyo administration was 41.5 percent while under Aquino, it has increased to 49.3 percent (until April 2011). (See Table)

Despite the bigger debt servicing, the total outstanding debt of government (including contingent debt) still rose from P5.19 trillion in June 2010 to P5.23 trillion as of April 2011. The P40-billion rise in government debt includes $400 million (about P18 billion) in loans from the Asian Development Bank (ADB) approved last September 2010 to help bankroll the expanded CCT program. This means that the P23 billion mentioned by Aquino as savings from lower interest payments will just be used to pay for the rising debt obligations of government, including those incurred for the CCT.

Fiscal deficit

The credit rating upgrades were also achieved due to the improvement in the national budget deficit, another indicator closely watched to determine a country’s creditworthiness. From an all-time high (in absolute terms) of P314.5 billion in deficit in 2010, the Aquino administration has been able to substantially reduce the shortfall so far this year. From January to May 2011, the fiscal deficit was pegged at just P9.54 billion or 94.1 percent below the deficit during the same period in 2010. It is also way below the programmed deficit of P152.13 billion for the first half of the year.

This lower deficit was made possible by higher revenues and lower spending during the period. As compared to the first five months of 2010, revenues are higher by P81.5 billion while spending is down by P71.08 billion. Furthermore, monthly collections are more than P1.89 billion higher than expected while monthly expenditures are almost P21.55 billion lower than programmed.

At the people’s expense

But the improved fiscal situation was achieved at the expense of the people who are being deprived of social services as government under-spent and much of what it spent went to debt servicing. At the same time, the people are being squeezed dry with burdensome taxes to raise revenues.

To keep credit rating agencies and creditors impressed, Aquino rejected the growing public clamor to scrap or at least suspend the 12 percent value-added tax (VAT) on oil amid soaring pump prices. According to Aquino, “suspending the VAT might trigger a credit downgrade because credit rating agencies would likely deem such a move as ‘fiscally imprudent’.”

The oil VAT has become one of the most important sources of revenues for government since Arroyo introduced it in 2005. But it is also the most oppressive. Revenues from the oil VAT rise dramatically as prices of petroleum products increase. Due to higher oil prices this year, for instance, the Department of Finance (DOF) expects government to earn an additional P18 billion in revenues. From an original forecast of P52 billion in oil VAT earnings based on a global crude price of $80 per barrel, the DOF revised its projection to P70 billion based on $110 per barrel.

High pump prices made a significant contribution to higher tax collections this year. In the first two months of 2011, oil VAT revenues increased by P1.2 billion because of the oil price hikes. Aside from the 12 percent VAT, gasoline products are also charged with excise tax, which generated P4.03 billion for government from January to May this year – P389 million higher than during the same period in 2010.

Facts & figures that matter

Meanwhile, facts and figures that truly matter to the people have been ignored in Aquino’s SONA – P125 or the amount of legislated minimum wage hike workers have long been demanding to help them cope with ever rising cost of living; 6,453 hectares or the size of Hacienda Luisita lands that should have long been owned and controlled by farmers and farm workers; 556,526 or the number of families living in informal settlements in Metro Manila and face the threat of forced eviction; 27 or the number of times that diesel prices have gone up since Aquino became President; and 48 or the number of victims of extrajudicial killings in his first year as Chief Executive, among others.

By using numbers, the President hoped to be objective in presenting his administration’s supposed achievements during the SONA. But he ended up ignorant of the numbers that truly matter. (End)

Economy, SONA 2011

SONA 2011: Making sense of Aquino’s facts and figures (part 1)

Activists burn the Penoy effigy, a symbol of the oppressiveness, incompetence, and subservience to the US of the Aquino administration during the SONA protest organized by BAYAN (Photo by Josh Castro)

Malacañang promised that this year’s State of the Nation Address (SONA) will present “undisputed facts and figures” instead of motherhood statements. President Benigno S. Aquino III did use a lot of numbers in his SONA speech (Read the full text) to underscore the supposed economic gains of the past year. But there were still motherhood statements and the usual “walang wangwang” rhetoric. The figures, meanwhile, are still disputable, carelessly used by his speech writers in an attempt to paint a bright picture of the present state and direction of the economy.

On hunger and poverty

Aquino cited as one of the gains of his government the decline in self-rated hunger from 15.1 percent in June from 20.5 percent in March. This is equivalent to one million families who no longer experience hunger, said Aquino. The figures are from the second quarter 2011 hunger survey of the Social Weather Stations (SWS).

But quarterly hunger surveys are sometimes volatile (e.g. self-rated hunger fell from 21.1 percent to 15.9 percent in Aquino’s first 100 days) so it is important to look at the long-term trend. In the first year of the Aquino administration, quarterly self-rated hunger averaged 17.4 percent. During the nine years of the Arroyo government, it averaged a lower 14.58 percent and just 9.96 percent under deposed President Joseph Estrada. These numbers indicate that the country is still on the path of worsening hunger.

Malacañang, through Presidential Communication Operations Office Secretary Sonny Coloma, has earlier attributed the decline in self-rated hunger to Aquino’s conditional cash transfer (CCT) initiative or the Pantawid Pamilyang Pilipino Program (4Ps), a poverty alleviation measure first started in the country by Gloria Arroyo. In his SONA, Aquino boasted that the 4Ps has already registered 2 million families as beneficiaries, of which 1.6 million are already receiving the cash grant. This means, according to the President, that more than 100,000 families are being saved from the clutches of poverty (naiaahon sa kahirapan) every month.

If this is true, then the Aquino administration can reduce by 2.3 million – the target number of CCT beneficiaries by the end of 2011 – the number of poor families by yearend through the simple provision of cash grants. The total number of poor as of 2009 is just 3.67 million families as officially defined and measured by the National Statistical Coordination Board (NSCB). Thus, by 2012, there will only be 1.37 million poor families (assuming official poverty levels remain the same) – a number that Aquino intends to wipeout with his plan, as he said in his SONA, by including an additional 1.3 million beneficiaries in the CCT program.

But that is going by Aquino’s poverty mathematics which is based on a flawed official definition of who is poor. According to the NSCB, anyone who has P46 a day is not poor – a ridiculously low standard resulting in absurdly low poverty levels. Based on the June 2011 survey of the SWS, 9.8 million households consider themselves poor or almost three times the number of poor families as measured by the NSCB. This means that more than 6.1 million poor families are not covered by the CCT program.

However, its small coverage relative to the total number of poor is just a minor issue compared to the more fundamental issue of sustainability and long-term impact of the program. How can the CCT achieve its stated objective of investing in the poor when it’s funded by debilitating foreign debt and not even complemented by substantial investments in public education, health, and housing? What will happen to the beneficiaries of CCT once the program is over and still no jobs are available?

On jobs

But as far as Aquino is concerned, jobs are being created. In his SONA, he mentioned that the unemployment rate in April went down to 7.2 percent in April 2011 from 8 percent during the same period last year, crediting the efforts of his administration. Some 1.4 million jobs have been supposedly created in his first year. The numbers are from the Labor Force Survey (LFS) of the National Statistics Office (NSO).

The 1.4 million jobs supposedly created between April 2011 and April 2010 could not be attributed to government intervention. In the first place, the only job generation program that the Aquino administration has so far initiated is the Community Based Employment Program (CBEP). This program has only created 170,000 jobs out of a target of 1.1 million. About 63 percent of these jobs are in infrastructure/construction, of low quality, and highly temporary. The 170,000 could even be deceitful because a worker can avail of more than one CBEP job.

Looking at the NSO data, more than 456,000 jobs of the 1.4 million additional jobs are classified as those who worked for private households (domestic help, etc.), self-employed without any paid employee (vendor or sari-sari store owner, etc.), employer in own-family operated farm or business, and worked without pay in own-family operated farm or business. In other words, a significant part of the additional employment in the past year was due to the people’s sariling diskarte and not because of any meaningful job generation program of government. (See Table)

Figures in '000

Furthermore, NSO jobs figures have long been unreliable for distorting the concept of unemployment and statistically deflating the extent of job scarcity in the country. For instance, the NSO does not count as unemployed those who are seeking work but for one reason or another (e.g. school or family obligations, illness, etc.) will be unavailable for work despite an opportunity within two weeks after the survey. Meanwhile, household members who help operate the small family farm, sari-sari store, or eatery are considered employed, including those who helped for even just one hour in the past week before the NSO survey.

Because of such distortions, the number of jobless according to the April 2011 LFS of the NSO is just 2.9 million workers. In contrast, adult unemployment rate as measured by the SWS in its own survey was pegged at 27.2 percent or 11.3 million workers in March 2011. Like in the case of hunger, it is important to study the long-term trend to determine if headways are being made in job creation.

Based on SWS data, the average adult unemployment rate under Aquino is 23.2 percent, a continuation of the deteriorating domestic jobs situation. Under Arroyo, it was 19.77 percent; Estrada, 9.66 percent; and Fidel Ramos, 9.66 percent. NSO employment data since April 2005, meanwhile, could no longer be compared to previous years because of a redefinition made by the National Statistical Coordination Board (NSCB). The shift in definition “reduced” official unemployment by 1.9 million in the April 2005 survey. (To be concluded)

SONA 2011

SONA 2011: Is Aquino sincere in making Gloria Arroyo accountable?

Is Aquino just utilizing the strong anti-Arroyo sentiment to cover up his own failures and address the growing disenchantment of the people in the run-up to his SONA? (Photo from

In the run-up to the second State of theNation Address (SONA) of President Benigno S. Aquino III, his camp has been playing up the theme “despite the great problems left behind by the corrupt Arroyo legacy, the seeds of change have been planted.” This premise both justifies the shortcomings of Aquino and draws the false image of a presidency bent on implementing its reform agenda amid the challenges.

Malacañang also dismisses critical Filipinos as simply “so negative” which according to Undersecretary Manolo Quezon III, is Aquino’s “biggest frustration as President.” Quezon complained that “people are quick to say you can’t do it… nothing will happen.” But really, the people are simply asking, what has happened to the promises of Aquino, foremost of which is making Mrs. Gloria Arroyo accountable?

“Seeds of change”

What are the supposed seeds of change planted by the Aquino administration in the past year? Malacañang and its supporters trumpet what they call important battles won against corruption, which has been Aquino’s banner campaign since the elections. In fact, Aquino clinched the presidency riding on an anti-corruption platform with the prosecution of Gloria Arroyo as the main goal.

Supporters point to the resignation of Ombudsman Merceditas Gutierrez as proof of the dogged intent of the President to put Arroyo behind bars. Aquino openly supported demands for Merci to quit instead of going through the arduous process of impeachment trial. With Merci out of the picture, the prospects of making Arroyo accountable have vastly improved.

Alas, more than two months have passed since the pro-Arroyo Ombudsman was forced to resign, there’s still no actual case filed by Aquino against the former President. The botched Truth Commission is supposed to be already holding tons of evidence proving that Arroyo, her family and allies had enriched themselves through massive graft and corruption. Yet, until his first year speech, all Aquino can offer are tirades that, sans concrete action, have lost their meaning.

Plunder cases filed by progressive groups

Meanwhile, progressive anti-Arroyo groups have remained determined to pin down Arroyo. Partylist group Bayan Muna filed graft, malversation, and plunder raps against Arroyo before the Ombudsman over the alleged misuse of at least P325-million Philippine Charity Sweepstakes Office (PCSO) funds. The funds allegedly were used for political largesse, partisan electoral purposes, and simply pocketed.

Migrant workers’ group MIGRANTE International and former Solicitor General Frank Chavez also sued Arroyo for plunder over the alleged misuse of P530-million Overseas Workers’ Welfare Administration (OWWA) funds. According to them, the funds were used for questionable purposes that did not benefit OFWs such as for health insurance cards to eight million indigents just a year before the 2004 presidential elections.

Peasant group Kilusang Magbubukid ng Pilipinas (KMP) has also asked the Ombudsman to include Arroyo in the earlier plunder case it filed against ex-Department of Agriculture (DA) Undersecretary Jocelyn “Joc-Joc” Bolante in relation to the P728-million fertilizer fund scam. The money was supposed to be used for the purchase of fertilizers to help the farmers but was diverted to help bankroll the 2004 presidential bid of Arroyo.

Aside from corruption, legal cases also hound Arroyo for grave human rights violations such as the P15-million civil suit filed by six members of the Morong 43, a group of health workers illegally arrested and tortured, and detained for 10 months by the Armed Forces of the Philippines (AFP).

Serious doubts

Its failure to file a case naturally raises serious doubts about the resolve of the Aquino presidency to go after Arroyo. The pretext that government would rather take it slowly but surely is a lame excuse. One year is long enough to build a strong case especially if you have the entire machinery and resources of government at your disposal. Remember that it only took three months for Arroyo to file plunder cases against deposed President Joseph Estrada before the Sandiganbayan.

This is where Aquino’s supporters miss the point when they complain that critics are impatient. Change is a long process and it does not happen overnight, they point out. But who asked Aquino to change the country overnight? Who asked him to shortcut the process? What people ask is pretty simple, doable, and concrete – file at least one case.

But Aquino had already missed the historic opportunity to do this in his first year. It’s not farfetched that for all the noise in making Arroyo accountable, the Aquino administration may be willing to compromise in the name of political expediency. Or maybe Aquino and his advisers have realized that politically, it is better that Arroyo is kept out of jail because as long she’s free, Arroyo is a convenient excuse to justify Aquino’s inadequacies and an easy target to gather popular support.

In the name of justice

This has been observed in the events following recent reports by the Social Weather Stations (SWS) and Pulse Asia showing the continuous decline in people’s satisfaction over the performance of Aquino. The “revelations” by Zaldy Ampatuan, former Governor of the Autonomous Region in Muslim Mindanao (ARMM) and one of the primary suspects in the Maguindanao Massacre, of the massive electoral fraud and corruption in Maguindanao involving Arroyo and the subsequent resurfacing of ex-Commission on Election (COMELEC) supervisor Lintang Bedol to corroborate Ampatuan’s allegations of cheating in the 2004 presidential and 2007 senatorial polls have shifted public attention from the non-achievements of Aquino to the numerous crimes of Arroyo.

Is Aquino just utilizing the strong anti-Arroyo sentiment to cover up his own failures and address the growing disenchantment of the people in the run-up to his SONA? But at what cost? Will it be at the expense of the victims of the gruesome Maguindanao massacre and their families?

In the name of justice, Arroyo must be made to pay for her many crimes against the Filipino people.  Aquino made the people believe that he will do just that and was made President in the process. But in the world of elite politics reigned by self-serving interests, many things are not as straightforward as they should be.

Oil deregulation, SONA 2011

SONA 2011: 27 rounds of diesel price hikes, oil profiteering highlight Aquino’s failure

Amid 27 rounds of diesel price hikes since becoming President and unabated profiteering by oil firms, Aquino displays a helpless and defeatist attitude

Less than a week before the second State of the Nation Address (SONA) of President Benigno S. Aquino III, oil firms again jacked up their pump prices. On Monday (July 18), oil companies hiked the price of diesel by P1.10 a liter; kerosene, P1; regular gasoline, P0.60; and unleaded gasoline, P0.30.

This is the second consecutive round of oil price hikes in the weeks leading to Aquino’s second SONA. Last July 12, oil firms raised the pump price of unleaded gasoline by a whopping P2 per liter and diesel, P0.80.

The Aquino administration can, of course, pin the blame on rising global oil prices and claim that it is beyond its control. But precisely because of this helpless and defeatist attitude that oil companies are able to aggravate the plight of the people as they continue to profiteer from rising oil prices.

Total price hikes

All in all, there have already been 27 rounds of diesel price hikes since Aquino was sworn in as President last June 30, 2010, 16 rounds of which happened this year. Similarly, there have been 28 rounds of unleaded gasoline price hikes during the same period, 17 of which happened in 2011.

The common price of diesel in Metro Manila is now pegged at P45.60 per liter from P34.25 when Aquino was inaugurated, or a total increase of P11.35 per liter. The common price of unleaded gasoline, meanwhile, went up from P44 per liter to P56.95 today, or an increase of P12.95 per liter. (See Chart)

Aquino’s liability

Local oil prices, of course, have already been rising rapidly even before Aquino became President especially since the downstream oil industry was deregulated in the late 1990s. Aquino, however, refused to support the demand by various sectors to repeal Republic Act (RA) 8479 or the Oil Deregulation Law. In this regard, Aquino is liable to the people.

RA 8479 allowed oil firms to adjust pump prices automatically based supposedly on price changes in the world market. Because the industry is dominated by the international oil cartel of American and European firms, the law merely gave the big oil players more room to pad the true cost of oil products in the country. Aside from monopoly pricing, oil prices in the world market are also artificially bloated by speculation. All this is fully passed on to consumers making oil prices excessively high.


Due to deregulation, oil companies in the Philippines are also able to rake in additional profits by implementing weekly price adjustments that are beyond what supposed international price benchmarks warrant.

From January to July 12 this year, for instance, the pump price of diesel should have only gone up by an estimated P5.45 per liter based on the movement of benchmark Dubai crude as well as the foreign exchange (forex). During the period, the monthly average of Dubai jumped from $92.19 per barrel in January to around $109.5 in the first two weeks of July. Forex, on the other hand, improved from P44.17 per US dollar to about P42.71. (See Table)

But actual change in diesel’s common price in Metro Manila reached P7.10, indicating an over-recovery of P1.65. The same thing could be observed in the pump price of unleaded gasoline which increased by P7.95 per liter, for an estimated over-recovery of P2.50. Since the oil price crisis in 2008, the accumulated profiteering by local oil firms has now reached about P8.37 to P9.22 per liter.

No real reforms

Instead of marshaling his allies in Congress to work for the repeal of RA 8479 and support proposals like House Bill (HB) 4355 filed by the progressive bloc of partylist groups at the House of Representatives, Aquino implemented the Pantawid Pasada. Not only is this seriously lacking as a relief measure, it also underscores Aquino’s lack of interest in implementing fundamental reforms in the economy to address longstanding problems like exorbitant oil prices, energy insecurity, and abusive practices by foreign cartels.

Oil price hikes could have been mitigated by cancelling the Arroyo-era 12% value-added tax (VAT) on petroleum. But even this was rejected by Aquino because it might turn off the foreign creditors and credit rating agencies. The Aquino administration today is collecting a VAT of around P5.47 a liter on diesel and around P6.83 on unleaded gasoline. When Arroyo stepped down, the VAT on diesel then was only about P4.11 per liter and unleaded gasoline, P5.28.


Aquino’s supporters often dismiss critics of the administration as simply impatient. It has only been one year, they point out. Change is not an overnight process, they say. To be sure, no one’s asking the President to change the country in one year. But it must be also recognized that the problems facing our people are urgent, requiring immediate and decisive action from Aquino.

Oil prices, as mentioned, have risen by P11 to 12 a liter via 27 to 28 rounds of oil price hikes in just a year while oil firms continue to overprice their products. In just one year, jeepney drivers saw their income being eroded by more than P340 a day due to unabated oil price increases. The same thing is true for millions of farmers, fishers, households, etc that rely on petroleum products on a daily basis.

Some transport groups have used the latest surge in petroleum prices to again press for another round of fare hike. At the start of year, the minimum fare for jeepneys has been raised by P1 due to unabated increases in the price of diesel. Just four months ago, the minimum fare for buses has also been increased by P1. Driven by escalating fuel prices, inflation last month reached 4.6 percent – the highest since April 2009.

Issues like these need immediate attention. The people have every right to be impatient. Aquino does not enjoy the luxury of time.

SONA 2011

Aquino’s first year speech: Dubious claim on improved rice security

Aquino’s first year speech was not only very thin in substance but also claimed dubious achievements such as rice security (Photo by Raffy Lerma)

As usual, President Benigno S. Aquino III spent a big portion of his speech during his administration’s first anniversary rites yesterday blaming Mrs. Gloria Arroyo for the numerous problems facing the country. To be sure, the despised Arroyo administration has a lot to account for. But the people have long been waiting for actual charges to be filed against Gloria Arroyo for her corruption and human rights abuses. Sadly, after a year in office, all Aquino has done is whine while using Arroyo’s misdeeds to justify his own shortcomings. (Read the full text of his speech here)

The President, of course, also enumerated some accomplishments that his administration has supposedly achieved in the past year. One of the purported achievements Aquino highlighted is the improvement in the country’s rice security, to wit:

“Noon pong isang taon, barko-barkong toneladang bigas ang inaangkat, at katakut-takot din ang gastusin sa mga bodegang pinagtatambakan nito. 1.3 million metric tons lang po ang kailangan natin pampuno sa kakulangan ng ating ani, pero umangkat sila ng dalawang milyong metriko tonelada. Ngayon po, halos kalahati na lang ang inaangkat nating anim na raan at animnapung libong metriko tonelada.”

The Department of Agriculture (DA) has set a target of just 860,000 metric tons (MT) of rice imports this year from a record 2.45 million MT in 2010. According to the President, government is on track to meet its target based on first half figures. How did government achieve this? Again, quoting Aquino’s speech:

“Hindi po tayo nag-magic para dumami ang bigas na inaani natin dito: itinutok lang po natin ang pondo ng irigasyon sa kung saan ito pinakamura at mabisa; pinalawak ang paggamit ng maiging klase ng binhi; at pinalawig din ang upland rice farming. Lahat po ito, nagdulot ng dagdag na labinlimang porsyento sa ating inani noong huling taon, at ng pinakamataas na ani sa kasaysayan ng dry season cropping.”

Aquino credited his agriculture program promoting the more efficient use of irrigation, use of better rice varieties, and expanded upland farming for the improvement in rice yield by 15% and a record harvest for the dry cropping season.

But the Bureau of Agricultural Statistics (BAS) has a different explanation behind the increased yield. Here’s a portion of their latest report Rice and Corn Situation Outlook, Vol. 25 No. 2, April 2011:

“The January-June 2011 palay production may reach 7.61 million MT, 14.9% higher than last year’s level of 6.62 million MT.  This could be attributed to the expansion in harvest area and improvement in yield compared to last year’s conditions when palay production was adversely affected by the El Niño phenomenon.  Area harvested may increase by 10.2% from last year’s record of 1.82 million hectares.  Yield per hectare may improve from 3.64 MT in 2010 to 3.80 MT this year.”  (Emphasis added)

(You may download BAS’s full report here)

Based on BAS’s report, the 15%-improvement in rice yield, which Aquino cited in his speech, can be attributed mainly to improved weather conditions. Palay production last year fell by more than 7% because of the drought. Thus, the supposed increase in yield is not really an expansion but merely a recovery from the 2009-2010-decline, pushed chiefly by favorable weather and not by any meaningful agricultural program. Yield per hectare, meanwhile, practically remained at its level before the 2010 El Niño, showing that productivity, which is a more reliable indicator of whether higher production is due to government intervention, did not really move. (See Table, lifted from the BAS report)

Moreover, the growth figures on rice production mentioned in Aquino’s speech – including the supposed all-time high harvest for the dry cropping season – are just based on projections and not on actual records.  In his most recent statement to the media (July 27), Agriculture Secretary Proceso Alcala said that, “Palay production in the first half of this year may reach 7.6 million metric tons” and that “this estimated output will put the government about halfway toward achieving its full-year target palay production of 17.46 million tons.” Alcala was quoting the BAS estimates cited in the April 2011 edition of the Rice and Corn Outlook.

Alcala’s confidence is hinged on the strong performance of rice production in the first quarter of the year when it reached 4.04 million MT or almost 16% higher than during the same period last year. For full-year 2011, the DA expects total production to reach 17.46 million MT, “barring any major weather disturbance.”

Lastly, the favorable rice supply in the first half of the year benefited as well from the over-importation of rice by the Arroyo administration in 2010. An audit team formed by the National Food Authority (NFA) disclosed that last year, there was an over-quantity of about 0.82 million MT in rice imports. This boosted the buffer supply of the NFA reducing the need for more importation.

Aquino’s first year speech was already very thin in substance particularly in terms of accomplishments. Worse, even the few achievements specified by the President like the rice supply situation seem highly dubious. (End)

Governance, SONA 2011

Aquino’s “Pilipinas Natin”: Pilipinas nino?

Pilipinas nino? Aquino has never made the poor and oppressed feel that this is also their country (Photo from

President Benigno S. Aquino III today (June 30, 2011) will mark his first year in office by launching a campaign called Pilipinas Natin. According to the Presidential Communications Operations Office, Pilipinas Natin “represents the point of departure from the failed policies of incremental, trickle-down growth that characterized previous development plans.” It added that “vigorous job creation, educational reform, and comprehensive social and development programs will be implemented to ensure attainment of sustained economic growth.”

Malacañang spokesperson Edwin Lacierda, meanwhile, called the campaign “a call to arms for the people to continue in the efforts for reform by this administration.” It supposedly aims to “mobilize the people to become active participants in nation building.”

The public certainly wants to see the substance, if there’s any, of this latest publicity stunt by Malacañang. How exactly does the President intend to mobilize the people and implement the promises of jobs, education, and comprehensive social development?

However, based on his administration’s one-year track record, the poor and oppressed couldn’t help but ask, “Pilipinas nino?” Exactly what kind of nation are we building that Filipinos will rally behind? Pilipinas nino—because Aquino in one year has made it unmistakably clear where his bias lies.

Aquino has shown that he favors the market over the people. Look at how he refused to impose price control and justified deregulation amid escalating prices of basic commodities and services. His public-private partnership (PPP) is for big business’ profits at the people’s expense. Look at how he allowed the 300% hike in SLEX (South Luzon Expressway) toll and how he pushed for as much as 100% fare hike in LRT/MRT despite strong opposition from various sectors.

He favors foreign creditors over the people. Look at how he defended the 12% VAT (value-added tax) because scrapping the onerous tax will turn off the foreign banks. Look at how he spent more than half of the people’s money for debt servicing in his first year in office while spending practically nothing for the marginalized, like the urban poor’s housing needs.

He hastily phoned the governor of Quezon province to stop bugging the Japanese investors of the Pagbilao power plant over P6 billion in unpaid real estate taxes, saying that Malacañang will foot the bill. He promised PPP investors protection from local courts, Congress, and regulatory bodies through regulatory risk guarantee.

But he refused to display the same decisiveness and political will to help workers secure a substantial wage hike through legislation. Or to provide respite to urban poor communities from violent demolitions. Or to oblige his own family to respect the historical, legal, and moral rights of farmers and plantation workers over the Luisita lands.

Pilipinas nino? Aquino has never made the poor and oppressed feel that this is also their country, that his government is also their government.

All hope is not lost, however. It just doesn’t lie in Aquino’s hands.

The people could still make this country truly ours, truly Pilipinas natin. (End)

Economy, SONA 2011

State of the Nation under Aquino’s first year: “Pamumunong manhid sa daing ng taumbayan”

The Aquino presidency turns 1 on June 30 (Photo from

Despite the continuing decline in the people’s satisfaction and approval of his performance as President, Benigno S. Aquino III claims that he is not worried. “I’m really not concerned with the popularity. It will go up and down,” Aquino said in reaction to the latest survey of the Social Weather Stations (SWS).

The SWS reported that the net satisfaction rating of the President fell to +46% in June from a high of +64% in November 2010. A separate survey by Pulse Asia also shows a similar trend. The approval rating of Aquino dipped to 71% in May from 79% in October 2010.

Aquino, however, is missing the point. The issue is not popularity.

The promise

On June 30, 2010, during his inaugural speech, Aquino boldly declared: “Ngayon, sa araw na ito – dito magwawakas ang pamumunong manhid sa daing ng taumbayan.” He also said, “Kayo ang boss ko kaya’t hindi maaaring hindi ako makinig sa utos ninyo.”

What exactly are the grievances of Aquino’s supposed boss?

From June 25-28, 2010 – a couple of days before the inauguration – the SWS asked 1,200 respondents, “In your opinion, which of the following issues should the next President of the Philippines focus on?” Allowed to choose up to three issues, 43% of the respondents answered “giving livelihood programs”; 33% said “providing jobs”; and 32% said “prices of basic commodities.”

Thus, if President Aquino is facing a decline in the SWS and Pulse Asia performance surveys, it’s not because of bad public relations. It’s not simply “a weakness in messaging” as Aquino put it. The emerging trend in his satisfaction and approval ratings as President is about policy. People expected him to address their most urgent issues – livelihood, jobs, and prices. After a year, he has not only failed but even exacerbated the plight of the people.

Just how bad is the situation? According to SWS in its March 2011 survey, 11.3 million workers are jobless. That’s almost 3 out of 10 Filipino workers. The intensity of joblessness has doubled in the past two decades. The average rate of unemployment in 1993 (first time SWS measured joblessness) was just 13.6%. Today, that number has soared to 27.2%. The SWS also said that 1 out of 4 families experience hunger and that more than half consider themselves poor. That’s 10.4 million poor families, of which 4.1 million go hungry. The first time SWS conducted its hunger survey in 1998, the hunger incidence was 11% of families. By 2011, it has almost doubled to 20.5%.


That is the magnitude of the problem which long-term trends show is deteriorating. Yet, all Aquino can offer are pantawid measures. For the poor and hungry, he has the Pantawid Pamilya. For the lowly tsuper battered by oil price hikes, he has the Pantawid Pasada. For the jobless, he has the pantawid trabaho also known as Community-Based Employment Program (CBEP). But the scale of joblessness, hunger, and poverty is too great for pantawid measures to matter even when properly and fully implemented. Pantawid Pamilya, for instance, excludes 8 million poor families, including almost 2 million families who have difficulty affording a need as basic as food. The Pantawid Pasada, on the other hand, has already become meaningless even before it can take off due to continuing OPH. (Read here) Not to mention that it excludes everyone else hurting from soaring oil prices.

The CBEP, meanwhile, aims to generate 1.1 million jobs this year, less than 10% of the estimated number of unemployed. These jobs are all temporary, of which almost 63% are in infrastructure. Despite the low quality and temporary nature of these jobs, the Aquino administration is still having a hard time generating them. With just six months left for the year, the program has generated just 170,000 jobs – 15% of the target. A fast and sustainable way to generate productive jobs massively is to dismantle the haciendas across the country for landless farmers to till. But the haciendero President doesn’t even want to talk about Hacienda Luisita and genuine land reform in his major policy speeches.

Soaring prices

Worse, Aquino’s pantawid programs are not only gravely inadequate even as relief measures. His main policies are also gravely anti-poor. He ordered the National Food Authority (NFA) to hike the price of its rice by P2 to 4 a kilo. The move was part of the gradual privatization of the agency’s functions. Aquino also refused to control spiraling prices and ignored calls to scrap the 12% value-added tax (VAT) to at  least mitigate the impact on consumers. That will turn-off investors and creditors, he said.

Consequently, since Aquino’s inauguration, households are now paying P107 more for an LPG tank while jeepney drivers saw their daily income fall by more than P340. Households consuming 200 kilowatt-hours (kWh) are now shelling out an additional P86 to pay MERALCO and NAPOCOR. Households consuming 30 cubic meters (cu.m.) are now paying P97 more to Manila Water and P224 more to Maynilad. (See Table)


Meanwhile, to promote his public-private partnership (PPP), he allowed the foreign operator of SLEX to jack up its fees by 300% and approved a fare hike of as much 100% in LRT and MRT. Aquino even promised potential PPP investors that they should not worry about the courts, Congress, or regulators. Filipino taxpayers will shoulder the cost of their guaranteed profits through regulatory risk guarantee. The NEDA is now pushing for an amendment of the BOT Law to implement this.

Aquino’s concern for big business interest – oil companies, power firms, toll operators, prospective PPP investors, etc. – is only matched by his indifference to the working people’s demand for decent wages. He refused to show political will and help workers secure a substantial wage hike through legislation. In the end, wage earners in Metro Manila did not get a wage hike but a measly P22 cost of living allowance (COLA) from the regional wage board. Workers in the Eastern Visayas got a P23-pay adjustment (P8-wage hike and P15-additional COLA). But these adjustments – which workers in other regions did not enjoy – are so small and not enough to buy even a kilo of NFA rice. Nationwide, minimum wages are not even half of the amount needed for an ordinary family to live decently.

That is, if they still have a place to live. Demolition of urban poor communities has been intensifying under Aquino. The moratorium he promised to beleaguered informal settlers never came. In Metro Manila alone, 6,000 urban poor families have already been displaced in the first year of Aquino. That’s only a partial tally made by BAYAN-NCR.

Clearly, the pamumunong manhid sa daing ng taumbayan did not end on June 30, 2010. And if Aquino is not yet worried about the trend in public sentiment, he better be soon. (End)

Read more, download BAYAN’s paper and Powerpoint presentation on the national situation.