Selected Social Safety Net Programs in the Philippines: Targetting, Cost-Effectiveness, and Options for Reform by Kalanidhi Subbarao, Akhter U. Ahmed, Tesfaye Teklu
To ease transitional problems during stabilization and structural reform and to protect the well-being of the poor, the government of the Philippines have focused on three major safety net programs: food subsidies, public employment programs, and credit-based livelihood programs. Although substantial resources have been devoted to these programs, few studies have reviewed their impact on the poor. This study attempts to fill this gap. The study examines the effectiveness of the safety net programs from the perspectives of targeting, cost-effectiveness, and sustainability. The analysis suggests that the poorest income groups and regions are not receiving their share of benefits from the food subsidy program and that even the small amount of income transferred to the poor is achieved at a high cost. Based on international experience, the study examines various options to redirect the resources currently going to the food subsidy program to other targeted approaches for reaching the poor cost-effectively. The study notes that the public works program is also poorly targeted and suggests various design modifications. Finally, the study reviews the various credit-based livelihood programs and finds that most programs benefited the nearpoor and the nonpoor more than the ultrapoor. Moreover, the programs were implemented in regions that were better endowed with infrastructure and whose residents had higher average incomes. Leakages were substantial. The study notes that revamping the design of the programs can enhance the benefits to the poor and render the programs cost-effective.