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Philippines: Social Welfare and Development Reform Project

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Proper Targeting for Better Results:
The National Household Targeting System for Poverty Reduction for the Philippines


Overview

The National Household Targeting System for Poverty Reduction (NHTS-PR) in the Philippines was conceived in 2008 initially to identify potential beneficiaries of the government’s conditional cash transfer (CCT) program. Through World Bank assistance, the CCT became the first program to adopt an objective and uniform system for targeting poor households. As of July 2011, NHTS-PR has identified 5.2 million poor households, of which 2.3 million were enrolled in the CCT.


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Challenge

The Philippines has enjoyed economic growth in recent years, but many of the poor are being left behind. As of 2009, the latest official poverty statistics show that the 26.5 percent of the population (or about 23 million Filipinos) is poor.


The Philippine government through its Department of Social Welfare and Development (DSWD) is mandated to protect poor households. But given limited resources, the government needs to have a clear system for identifying the poor and determining where they are.


Past programs applied varying targeting mechanisms that proved to be costly and ineffective, with high estimated leakage rates. Leakage rates for subsidies for the cost of electricity runs as high as 72 percent; food-for-school program, 59-62 percent; subsidies for senior citizens, 61 percent; and the National Food Authority rice price subsidy, 41 percent. Hence, there’s a need for a better household targeting system that could properly and objectively identify who and where the poor are, thus preventing or minimizing leakages of scarce resources to those who are not poor.


Approach

A good targeting system ensures that social protection programs benefit those who really need the assistance. By concentrating government resources on the poor, the government will have better impact at lower cost. A standardized and transparent household targeting system can also improve the governance, transparency, and credibility of programs. Since the government is using a unified set of criteria for identifying the poor, it becomes much easier for government to bring together all of its programs to a particular group of poor households.


The NHTS-PR uses observable and verifiable characteristics of households as criteria for classifying households as poor, which reduces opportunities for favoring one group of beneficiaries over another. It uses a proxy means test to estimate the income of households, which is widely considered to be the most straightforward, practical and reliable way to gauge poverty, particularly in countries such as the Philippines. A validation process was also put into place to give households that were not included in the list of poor households, an opportunity to be re-assessed.


Results

The country’s CCT program called Pantawid Pamilya is the first program in the Philippines that benefits from an objective, transparent, and a uniform system of targeting poor household beneficiaries. From an initial survey of potential beneficiaries, the NHTS-PR grew to become the government’s largest and most updated database of poor households. As of June 2011, 10.9 million households were assessed, and 5.2 million households were identified as poor. Among those identified, 2.3 million households were enrolled in the government’s CCT program by the end of 2011. (Pantawid Pamilya provides cash grants to poor families in poor areas to encourage them to keep their children in school, have regular health checks, and pregnant mothers attended to by health professionals during child delivery.)


The NHTS-PR was also instrumental in scaling up the government’s conditional cash transfer program and securing the much needed funding in order to cover more beneficiaries for the coming years.


The government has adopted the NHTS-PR as the database for identifying poor beneficiaries of all major social programs nationwide. Other programs including universal health insurance for the poor, cash-for-work, and pensions for senior citizens, to name a few, are using the NHTS-PR’s database to reach poor households.


Voices


Education is very important especially for us indigenous peoples. It’s a path to improve our lives. But we are subsistence farmers, we are very poor, so we can’t afford to send our children to school. Pantawid Pamilya is really a big, big help.  

— Lina Libayao, mother of five and member
of the Ata-Manobo indigenous peoples group in
Talaingod, Davao del Norte in southern Philippines


Bank Contribution

A total of US$64.5 million was allotted for building the initial infrastructure and management information systems of the NHTS-PR through the Social Welfare and Development Reform Program, financed by the World Bank. In 2010, technical assistance for the expansion and improving the efficiency of the NHTS-PR was also provided through a trust fund from the Australian Agency for International Development (AusAID), administered by the World Bank.


Partners

The NHTS-PR is led by the government’s Department of Social Welfare and Development (DSWD) with a National Technical Advisory Group composed of representatives of the National Statistics Office (NSO), National Statistical Coordination Board (NSCB), National Economic Development Authority (NEDA), and the academe. Members of the community were also tapped to serve as fieldworkers during data gathering and verification.


As of 2011, government agencies such as the Department of Health (DOH) and Philippine Health Insurance Corporation (PhilHealth) have already forged agreements with the DSWD to use the NHTS-PR database for their program planning and identification of beneficiaries.


Toward the Future

No targeting mechanism is perfect and the NHTS-PR is continuously being updated to ensure that the list is comprehensive enough to include people who are most vulnerable from falling deeper into poverty. A recertification of the NHTS-PR’s list of poor is planned in calendar year 2013 to ensure that the database contains an updated list of poor households nationwide.


Besides the list of surveyed households and the poor, the NHTS-PR contains other information that is useful for poverty analysis. As basis for identifying poor households, the NHTS-PR collects basic socio-economic indicators of households. This information includes household composition, education of household members, housing conditions, access to basic services, and ownership of assets, among others. Socio-economic indicators allow one to look at the profile of Pantawid Pamilya beneficiaries versus non-beneficiaries in program areas before the program was introduced.


For more information, please visit the Projects website.

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