Once again on poverty statistics or the poverty of statistics

Mr. Raya is a member of the management collective of Action for Economic Reforms, a research and policy advocacy NGO involved in economic and governance issues.  This article was published in the Yellow Pad column of BusinessWorld, March 7, 2005 edition, p. 21.

{mosimage}It’s final, says the National Statistics Coordination Board (NSCB),
after it released the technical notes on the latest poverty statistics,
confirming that poverty among Filipino families had indeed gone down
from 27.5 percent in 2000 to 24.7 percent in 2003. Early on, various
questions were raised concerning the validity of the 2003 poverty
estimates due to observed inconsistencies with trends in real income
and economic growth over the same period.

My own confusion about this issue was somehow clarified a few weeks
back when I bumped into Dr. Celia Reyes, who heads the NSCB Technical
Committee on Poverty Statistics. I requested Celia, a friend and
schoolmate from not so long ago, to explain to me in layperson’s terms,
the seeming contradiction between income and poverty trends. The
explanation was simple and straightforward. Celia clarified that the
deflator used for computing real income is different from the basket of
goods used in establishing the poverty threshold. She pointed out
further that since poverty is based on the income of the poorest
families, then this may not always go the same way as the average
family income. Well, I guess that for as long as we have the likes of
Dr. Celia Reyes in the NSCB, then we can be assured of competent and
professional handling of official data and statistics.

But my problems with statistics did not end there. Keeping track of
social progress has really become a tedious and sometimes frustrating
exercise. We in Action for Economic Reforms, along with Social Watch
Philippines, have been regularly monitoring the poverty situation and
development trends at both national and local levels. We have long
waited for the official poverty statistics which were originally due
for release in August of last year. Apart from the delay, another
weakness of the 2003 poverty figures is the absence of provincial
breakdowns, which could provide deeper insights into how local areas
are performing. This is important, especially in the case of the
Philippines, which manifests a highly skewed income distribution and
wide disparities in income levels across provinces. The reality is that
there is very little information on the poverty situation on the level
of provinces, districts and municipalities.

Apart from statistics on poverty, there is a huge and widening
information gap in key social development concerns. The availability,
accuracy and timeliness of data are perennial problems of the
government’s statistical system. These hamper planning and effective
monitoring of development initiatives. In particular, the lack of
updated and disaggregated statistics on nutrition, infant mortality,
maternal health, water access and morbidity makes it difficult to
thoroughly and accurately assess the country’s progress in achieving
the Millennium Development Goals (MDGs).

One factor that can perhaps explain the widening information deficit is
the lack of and diminishing resources invested in improving the
country’s statistical system. Because of budgetary constraints, the
government will no longer pursue the census that is planned and
scheduled for this year. The lack of financial resources has been
affecting the consistent generation of health statistics from the
national level down to the barangays. Statistics on child nutrition are
also under threat of becoming stunted, again due to consistent
financial constraints. Observers note that health statistics are
definitely unhealthy and suffering from funding deficiency. With the
fiscal crisis still very much with us, we should expect further
cutbacks in government expenditures, especially those considered low
priority or “unnecessary expenses.” And certainly, data collection is
among the first to fall by the wayside. I just hope this is not a case
of “what you don’t know won’t harm you!”

It now seems that there is not only poverty in Filipino households.
There is poverty in statistics as well. Such poverty is manifested not
only in financial terms, but also in the poor attitude and indifference
of many government units and officials towards statistics.

In most cases, statistics have either been misused or not used at all
in governance. Often, planning proceeds without the benefit of data and
situation analysis, while reports are generated and published merely as
promotional materials or to fulfill a requirement. There is no real
demand for information and, thus, no investments are poured into such
program. Statistics usually come after the fact if only to justify and
rationalize policies and programs that are already in place. Of course,
this is not the case for all. There are shining examples in good
governance worth emulating and which are actually being replicated in
many areas.

Going back to the latest poverty statistics, the technical notes issued
by the NSCB to explain the seeming conflict in the poverty and income
trends may be mathematically and technically consistent. But they may
not be necessarily sound. Actually, such discrepancy exposes a soft
belly in the current methodology in generating poverty estimates. This
may be a good time to review and evaluate the effectiveness of the
current methodology, particularly in terms of ensuring consistency and
timeliness, and compatibility with self-rated perception.

The latest poverty statistics tell us that growth has been pro-poor-so
says the NSCB. Based on current definitions, this assertion may be
technically consistent. But we may need to do a little more convincing
to tell the poor and hungry that indeed they have been lifted out of
poverty.

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