The PolicyMaker

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TABLE OF CONTENTS Foreword

v

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States Margaret Josephine N. Castil & Ricardo B. Deri

1-26

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon Paulina Mariea P. Labayo Maybelle Gallardo

27-41

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail Mark Jason C. Aquino & Benjar A. Cataluna

42-57

The Impact of Agrarian Reform Community Connectivity and Economic Support Services to the Agrarian Reform Beneficiaries of Coconut Farms: A Case in Maria Rosario Isidro Lalig MultiPurpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna Zarah Abigail Detaunan & Rulina B. Viloria

58-77

Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas Cherise Andre Austria & Mikhail Nacino

78-98

Granger Causality Between Philippine Government Expenditures and Revenues and Its Policy Implications Lucky Raymundo M. Malveda

99-107

The Practice of Corporate Social Responsibility of Mining Sector towards Building Community-Based Enterprises: A Literature Review Rulina B. Viloria

108-122

An Assessment of the Impact of Programs of San Beda College in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province 123-143 Ricardo B. Deri, Celedonio B. Mendoza Jr., Edilberto B. Viray Jr., & Rulina B. Viloria

Research Collaboration: An Assessment of the Level of Readiness of the Tourism Industry of Japan and Philippines in Relation to 144-163 the Commencement of AEC 2015 San Beda University-Manila & Kobe University- Japan

FOREWORD The PolicyMaker is a testament to the dedication and commitment of the alumni, faculty, and students under the San Beda-Department of Economics of striving to be research-driven as part of its pursuit of academic excellence.

Through creation of relevant and quality research that does not only constitute as an academic exercise but may form as public policies, the PolicyMaker upholds the vision of both San Beda and the Department of Economics as globally recognized institutions that produces inclusive and transformative researches.

As the yearlong celebration of 50 years of Economic Excellence comes to a close thus ending an era, we must now welcome another 50 more years of academic excellence. In line with this new beginning, it is my great honor and pleasure to present the very first ISSN certified publication under the PolicyMaker. I hope this will be a great start in the continuation of the brand of Economic Excellence that San Beda-Department of Economics has exhibited and been known for over half a century. Let this be a legacy imparted by all the authors to all aspiring Bedan Economist in their pursuit of excellence. Let this be the mark that truly defines us. As our departmental adage states;

“Ang sarap maging Bedista, ang sarap maging Ekonomista�

Jerel Eliber Edwin L. Cruz Editor-in-Chief.

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States Margaret Josephine N. Castil & Ricardo B. Deri San Beda University

Abstract The primary objective of this study is to identify and analyze the factors that affects labor flow and deployment between the Philippines and ASEAN Member States applying the Gravity Model identify and its implications on the whole ASEAN region.

The study utilizes secondary data through data gathering instruments.

Quantitative descriptive research design is used for this study, and as for the statistical treatment, pooled ordinary least square regression was done using Gretl statistical software.

Labor flow and deployment were identified as the dependent variable while gross domestic product ratio, gdp per capita ratio, nominal exchange rate, remittances, unemployment and employment were identified as independent variables. After collecting data from various sources, the researcher was able to gather sixteen observations, ranging from the years 2000-2016.

JEL Classification:

E24, F16, F22, J08, J61, N35

Keywords: Gravity Model, ASEAN, Labor,

Employment

INTRODUCTION Overseas Filipino Workers. As ear ly as the 1970s, the migr ation culture for the Filipinos has been acceptable and even desirable because of its benefits. It became an avenue for the betterment of lifestyle. The Philippines has people in practically every corner of the world and has one of the highest rates of migration. According to Maruja M.B. Asis (2006) of Migration Policy Institute (MPI), there were approximately 8.1 million Filipinos in December 2004, almost 10 percent of the Philippine’s population who were working to estimated 200 countries.

Castil, M.J. & Deri, R. B.

2

The reality of global integration simply leads to facilitate migration flows so that every individual in the migration process gains more than loses and now is no longer the time to argue whether workers should be sent abroad or not. Especially in the Philippines, a major labor exporting country, migration management have always been grounded on the goal to make labor migration work for the benefit of the migrant workers themselves, their families and the whole society. Currently, this goal has become more imperative particularly because migration for work has been proven to have substantial implications on growth and development in the country. Today, OFWs are regarded as active development agents. Certainly, the Philippines could still improve its migration especially to its neighboring countries, the ASEAN Member States.

Gravity Model. One model that can be consider ed in studying about migration is the Gravity Model of Migration derived from the Newton’s law of gravity. Seemingly, the Newton’s law states that "Any two bodies attract one another with a force that is proportional to the product of their masses and inversely proportional to the square of the distance between them”, however within the Gravity Model of Migration “bodies” and “masses” are substituted by “locations” and importance”. Where importance then be measured in terms of economy size, market size or any other relevant variables. In Economics, Gravity Model is ideally utilized to analyze international trade between two nations considering their distance and economic size. This model can also presume traffic flow, migration among two areas, amount of people that is likely to use one central place likewise for consumption behavior or preference and in retail industries. Several critics of the Gravity Model declared that it is biased towards the largest inhabited areas. In this sense, the researcher made some adjustments to address this criticism by replacing population to deployed overseas Filipino workers per foreign workers (alien employment permit) within the Philippines as recommended by the statistical adviser. Hence, the deployment and foreign workers now represents the labor flow in line with the presumption of the model.

Besides the market size, the economy size or the gross domestic product and GDP per capita will also be accustomed to analyzing the model. Nominal exchange rate, a macroeconomic indicator would conjointly supplement the model. Other factors to be considered in the model includes remittances and distance.

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An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

Migration. Based fr om Or ganization for Economic Cooperation and Development (OECD), migration is a feature of social and economic life across several countries. Labor migration is typically outlined as a cross-border movement for purposes of employment in a foreign country. However, there is no universally accepted definition of labor migration. “Migrant workers” as outlined by Association of South East Asian Nations (ASEAN) refers to a person who is to be engaged or employed, is engaged or employed, or has recently been engaged or employed in a remunerated activity in a State of which he or she is not a national. Labor migration has important impacts on the societies.

They fill necessary niches both in fast-growing and declining sectors of the economy. Migrants contribute significantly to labor-market flexibility, notably in Europe. For the public funds, migrants contribute more in taxes and social contributions than they receive in benefits. They have the most positive impact on the public funds. Employment is the single biggest determinant of migrants’ net fiscal contribution. For the economic growth, migration boosts the working-age population. They arrive with skills and contribute to human capital development of receiving countries. Migrants also contribute to technological progress.

Global labor mobility has drawn increasing attention in recent years. Interest has additionally been stimulated by the increasing diversity of individuals crossing boundaries: immigrants, temporary employees, refugees, executives of multinational corporations and, in an exceedingly range of cases, even illegal migrants. There are peculiar motives for migrating. These movements of individuals have been influenced by push and pull factors such as, better jobs available abroad, opening of borders, easier mobility due to better communications and transportation infrastructure, and therefore the increasing need for services around the world. It conjointly includes inadequate income levels or gaps within the home country, delayed salaries, illegal recruitments and violence which includes trafficking and other rights issue.

According to International Labour Organization (ILO), the economic disparities among groups of Asian countries have been cited as a major factor in reference with per capita incomes ranging from a low of US$ 200 within the poorest countries to around US$35-40,000 in the advanced countries.

Labor migrant importing/receiving states. “Receiving State” refers to the ASEAN Member State which hosts a migrant worker. Singapore has the highest dependence on foreign workers. The country

Castil, M.J. & Deri, R. B.

4

contains a dual track policy on foreign labor and unrestricted inflow for the highly skilled and a managed inflow for the lower skilled workers.

Moreover, Malaysia is both a sending and receiving country. Currently, it is considered more and more a receiving country as its dependence on contract migrant workers is one of the highest in ASEAN next only to Singapore. Lastly, Thailand is both a sending and a receiving country.

However, it is becoming more and more a net receiving country, particularly, if one counts the irregular immigrants from Cambodia, Lao PDR and Myanmar (CLM) countries. This was due to the influx of refugees from conflicts in neighboring countries. Thailand was lacking in specified ways of migrating legally for low skilled and semiskilled workers.

Due to the good economic performance in late 1980s and early 1990s and the successful high education policy, refugees are no longer the reason for flow of irregular immigrants for the following years. Local workers became uninterested in low paying jobs. Thai businessmen had to employ irregular immigrants from neighboring CLM countries. Between 1960s to 2000, in Brunei, the number of Malaysian workers increased from just 7,000 to 31,000. Brunei then is considered a major destination point for migrants.

Labor migrants exporting/sending states. “Sending State� refers to the ASEAN Member State of which the migrant worker is a national. Cambodia is a migrant-sending country. Unfortunately, it is confronted with the distinctive problem of having a majority of its migrants being irregular. This is seen as the result of a concurrence of events in its history and the level of development, particularly the administrative capability of the country. Furthermore, Indonesia is among the nine major global worker-sending countries in Asia. Indeed, it has set a deployment and remittance receipt targets. Likewise, the Philippines has been continuously sending migrant workers abroad for 40 years now. Since 2005 the country has been deploying more than 1 million migrant workers and is receiving substantial remittances amounting to more than 10 percent of GDP. In Vietnam, overseas employment is viewed as an opportunity for job creation even before the restructuring of its economy. The deployment of the overseas workers can be grouped in two phases coinciding with the restructuring of the economy from a centrally planned to a state-regulated economic system around 1990. Finally, Laos and Myanmar are both sending countries as well.

As of 2014 there is a total of 64,800 deployments for Myanmar. 92 percent are deployed to ASEAN member states.

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An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

ASEAN Integration has been exerting so much effort to deduce and address the specified issues over the past years notably on the protection and promotion of the rights that are being discussed, reviewed and evaluated in ASEAN Forum on Migrant Labour (AFML) annually as well as the effort on the bilateral labor agreements. Despite all the actions made, the development has not been transparent and there is still a lack of clarity as to the process for member states to adopt the ASEAN standard. Since there are different countries involved, there are still some who disagree with some of the standards. According to Martin and Abella, only the Philippines has specific laws in pursuance of domestic workers. On the contrary, Singapore and Malaysia have exclusion clauses for foreign domestic workers.

Current Condition. Appr oximately, based fr om the United Nations (UN), migrants worldwide reached 258 million in 2017. The total number of international migrants increases continuously. With movement across borders now a reality that cannot be ignored, effective management of the labor migration process is essential. High-income countries hosts almost two thirds of all international migrants. In 2017, 80 million international migrants were residing in Asia, compared to 78 million in Europe. This exceedingly comprises 60 percent of all international migrants worldwide. Northern America hosted the third largest number of international migrants (58 million), followed by Africa (25 million), Latin America and the Caribbean (10 million), and Oceania (8 million).

According to UN DESA as of 2013, Asia hosted 70.8 million international migrants comprising 30 percent of 235 million migrants globally. Still in 2013, the World Bank reported that 10.2 million international migrants both residents and workers in ASEAN countries.

Persistently, outperforming the global average over the same period, labor force expansion and productivity improvements have driven annual economic growth of 5.2 percent from 2007-2015. (ASEAN, 2016). During the last two decades, labor migration has emerged as a significant driver of economic growth and development in both countries of origin and destination within ASEAN. Filipinos are highly encouraged to migrate not just because of the economic issues and circumstances discussed but also because of vast job opportunities waiting for them. ASEAN member states have been the Philippines’ labor migration partners for many years. Illustrated in table 1.1 are the job orders demanded in ASEAN member states

6

as of 2018. The reason why the processed job orders are not at 100 percent is because the needed job orders is not just for the Philippines but worldwide. Meaning, the Philippines is still performing well in terms of deployment. But looking at the balance of job orders, there is still a huge amount of opportunities for the Philippines among ASEAN countries hence, it must continue to improve its deployment.

Castil, M.J. & Deri, R. B.

Table 1. Job Orders - ASEAN Member States Jobsite / Position

Needed

Processed

Jobsite / Position

Balance

Brunei

5,086

1,768

35%

3,318

Cambodia

276

132

48%

144

Indonesia

250

52

21%

198

Laos

7

6

86%

1

Malaysia

27,738

6,160

22%

21,578

Myanmar

214

39

18%

175

Singapore

25,298

11,635

46%

13,663

Thailand

133

24

18%

109

Vietnam

457

113

25%

344

Source: Philippine Overseas Employment Authority

In the study of Kim, Keuntae and Cohen, Joel E. (2010), it was noted that most of the previous studies on international migration only considered a single destination country such as the United States (Isserman et al., 1985; Greenwood and McDowell, 1999; Clark, Hatton, and Williamson, 2007), the United Kingdom (Hatton, 2005; Mitchell and Pain, 2003), and Germany (Vogler and Rotte, 2000) or a small conglomeration such as North American destinations (Greenwood and McDowell, 1991; Karemera, Oguledo, and Davis, 2000). It was obvious that the countries mentioned were all among the most developed nations and have similar characteristics. However, Kim and Cohen stated that the current international migration is not limited to those destinations and needs a more complete picture of international migration system. In this sense, studying in the ASEAN Nations will be relevant today. Thus, the researcher proceeded with the study.

OBJECTIVE OF THE STUDY

REVIEW OF RELATED LITERATURE The Philippine Experience of Labor Migration. In the study of Manolo I. Abella, he stated that the Philippines’ history of labor export and its economic development are contrasted with those of Asian NIEs which have adopted liberal trade regimes. Structural economic and demographic factors combined with an inward-looking industrialization policy have sustained a strong labor outflow from the Philippines, in contrast to the NIEs which are becoming net importers of labor. In the newly emerging integration of Asian economies, the Philippines must develop exports based on factors other than labor intensity (e.g., its highly educated workforce) to maintain a competitive edge.

Migration Between the Philippines and ASEAN Member States. Accor ding to the Center for Migr ant Advocacy (September 2014), the AEC proposes free labor mobility for skilled labor when in fact, low skilled workers dominate the majority of worker movements in ASEAN. These types of workers are also under irregular migration status due to the lack of avenues for legal migration for them. Freer labor mobility for low skilled and semiskilled workers could prove beneficial. A rough calculation shows that a 5 per cent increase in the number of workers in industrialized countries would yield a global welfare gain of approximately 300 billion US dollars annually. Another calculation shows that 3 per cent increase of the labor force of rich countries supplied by poorer countries on a temporary rolling basis, with each

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

The main objective of this study is to establish the significance of selected Philippines’ and ASEAN member states’ macroeconomic indicators from 2000 to 2015 to the labor flow between each ASEAN member states. Specifically, this study will look into the Gross Domestic Product (GDP), Gross Domestic Product (GDP) per capita, Nominal Exchange Rate, and both the Employment & Unemployment in the Philippines and determine whether these macroeconomic indicators affects the deployment, Alien Employment Permit, and Remittance. Lastly, the implications of the study will help craft possible policy recommendations using the gravity model to improve, organize and strengthen the implementation of the ASEAN’s regulation and project proposals so as it would be more efficient and beneficial to the labor migrants and the whole society.

7

Castil, M.J. & Deri, R. B.

8

individual staying between 3 to 5 years, would increase the welfare of developing countries by 200 billion US dollars. Developed countries that would increase low skilled labor force by 3% per cent would raise their residents average welfare by 382 US dollars per person most of which would come from liberalizing the movement of low skilled labor.

This shows that the liberalizing of low skilled workers has a bigger impact than that of liberalizing skilled workers.

Since the movement of low skilled workers is dominated by irregular migration, better legal migration provision to low skilled workers would improve migration outcomes. (Orbeta 2013) The AEC is limited to liberalizing skilled workers due to the fact that countries of destination prefer immigration of highly skilled workers. Asian countries send more skilled migrants to OECD (Organization for Economic Cooperation and Development) countries and less skilled workers to other Asian countries. The Philippines shows to have high percentages in low skilled bilateral ASEAN migration flows: it has 100 percent in Cambodia, 64.7 percent in Indonesia, 96 percent in Malaysia, 51 percent in Singapore, 54 per cent in Vietnam, 34.1 percent in Lao PDR, and 41 percent in Thailand. (Orbeta, 2012).

With the number of low skilled workers around the ASEAN region especially those from the Philippines, there should be blueprints for these workers if ASEAN wishes to integrate fully. With regards to most of these low skilled workers being of irregular migration status, the AEC should also facilitate the issuance of visa and employment passes for low skilled workers. Also, most of these workers are part of the service sector such as the plantation workers and domestic workers.

Particularly the latter, they are recruited through agencies or directly by employers. In many instances, they are given work contracts in the country of origin which are replaced by another contract, usually inferior in terms, in the country of destinations. And because they are migrants who work in private households, in which they usually live with their employers, cases of exploitation and abuse appear.

Labor Flow. Based fr om the study of Caliendo, Mar co (November 26, 2009), assessing the performance of labor markets with static variables can give a misleading impression of the underlying labour market dynamics. Gross flows into and out of employment are much greater than the net results and reflect both labor demand (firms’ adjustments of labour inputs to final demand, competitiveness) and labor supply (movements of workers, job-to-job transitions). In a dy-

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An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

namic framework job separation (quits and dismissals), job vacancies and job matching occur simultaneously. In practice, the matching process will be costly and lengthy and significant imbalances and mismatches will remain. The aim of this section is to analyze what is known about such labor market flows to allow more effective policies.

A number of indicators are available to measure job flows and flows of workers or labour. Job flows are associated with labour demand and include indicators of job creation (JC), job destruction (JD) and job turnover (JT, the sum of JC and JD). Labor flows are associated with labor supply where labor turnover (LT) measures the number of workers changing employment status or moving between jobs. Comparisons between JT and LT can shed light on the relative importance of supply versus demand factors in driving labor market dynamics. International comparisons between JT and LT are difficult because flows might be measured at different frequencies, the unit of analysis might vary, and datasets might differ in their longitudinal quality/dimension.

Gravity Model of Migration. Fundamentally, Gr avity Model refers to the modified law of gravitation, takes into account the population size of two places and their distance. Gravity Model of Migration is derived from the Newton’s law of gravity. Seemingly, the Newton’s law states that "Any two bodies attract one another with a force that is proportional to the product of their masses and inversely proportional to the square of the distance between them”, however within the Gravity Model of Migration “bodies” and “masses” are substituted by “locations” and importance”. Where importance then be measured in terms of economy size, market size or any other relevant variables. In Economics, Gravity Model is ideally utilized to analyze international trade between two nations considering their distance and economic size. This model can also presume traffic flow, migration among two areas, amount of people that is likely to use one central place likewise for consumption behavior or preference and in retail industries. Several critics of the Gravity Model declared that it is biased towards the largest inhabited areas. In this sense, the researcher made some adjustments to address this criticism by replacing population to deployed overseas Filipino workers per foreign workers (alien employment permit) within the Philippines as recommended by the statistical adviser. Hence, the deployment and foreign workers now represents the labor flow in line with the presumption of the model.

Castil, M.J. & Deri, R. B.

10

Besides the market size, the economy size or the gross domestic product and GDP per capita will also be accustomed to analyzing the model.

Nominal exchange rate, a macroeconomic indicator would conjointly supplement the model. Other factors to be considered in the model includes remittances and distance.

Labor Migration and GDP. Accor ding to Inter national Labour Organization (2015), more than half of the world’s migrants (55 per cent or 128 million people) live in the G20 countries, and remittances to and from G20 countries account for almost 80 per cent of global remittance flows. Migrants today are younger and better educated, and women are increasingly migrating for employment, with domestic work being a major occupation. While the economic downturn contributed to a decline by 10 percent in migration flows to G20 countries in in recent years, aging populations and declining labour forces in most G20 advanced economies and some large emerging economies suggest that migrant workers will have an important role in maintaining labour supply and in filling labour shortages and social protection funds.

Evidence suggests that in most countries migrants pay more in taxes and social contributions than they receive, and contribute substantially to destination countries’ economies by providing the labour and skills needed in critical occupations and sectors. Across the advanced countries, the number of highly educated immigrants has increased rapidly over the past decade, which has important implications for productivity and innovation. Migrants could also play a role in facilitating trade and investment flows. Through the contribution of remittances, child labour could be reduced and schooling financed. Return migrants have the potential to make a positive contribution to the economic development in their countries of origin through the human, social and financial capital acquired abroad.

Labor Migration and Population. In the study of J oel E. Cohen, Marta Roig, Daniel C. Reuman and Cai GoGwilt (2008) published in Proceedings of the National Academy of Sciences of the United States of America (PNAS), they focused on population projection in accordance with international migration applying a statistical model called Generalized Linear Model where it used geographic and demographic independent variables only (the population and area of origins and destinations of migrants, the distance between origin and destination, the calendar year, and indicator variables to quantify nonrandom characteristics of individual countries) According to them, international

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An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

migration plays an increasing role in the demographic future of nations if fertility continues to decline in most countries. In projecting international migration, the United Nations Population Division identified the need for a demographically plausible, programmable algorithm that automatically projects a zero world balance of net migration and prevents projected net emigration from completely depleting the population of any sending country. To meet this need, they propose an algorithm (based only on demographic and constant geographic variables) for projecting future numbers of international migrants from any country or region to any other.

Labor Migration and Exchange Rate. Accor ding to David Khoudour-CastĂˆras, the pre-1914 world was characterized by the existence of the gold standard and, concurrently, by an exceptional mass migration phenomenon. Based on the theory of optimum currency areas, he showed that labor flows constituted an essential adjustment mechanism for countries that opted for pegging their currency to gold. Indeed, the choice of the external stability implied not only the loss of the exchange rate instrument, but also of the autonomy in terms of monetary policy. Therefore, other adjustment instruments were necessary, and it is likely that labor mobility played a central role in this process.

Thus, econometric tests for the period 1881-1913 show that there was a strong link between the prevailing exchange rate regime and labor movements: while significant variations in the emigration rate fostered the adjustment of trade balance in the countries that belonged to the gold standard, the countries with flexible exchange rates experienced a lower correlation between labor mobility and trade balance. For them, exchange rates constituted the main adjustment mechanism.

Labor Migration and Remittances. Accor ding to the findings of World Bank (2010), migration and remittances can be a valuable complement to broad-based development efforts. Yet, migration and remittances (collective or individual) should not be viewed as a substitute for official development aid as they are private money that should not be expected to fund public projects. Also, not all poor households receive remittances and official funds are needed to address the needs of these households. Harnessing the development potential of migration and remittances by increasing the awareness of the decision makers and improving data on remittances and migration; facilitating labor mobility and recruitment across borders, while allowing for safe

Castil, M.J. & Deri, R. B.

12

and affordable mechanisms for sending money back; and combating the increase of fear-based xenophobia and overregulation are some ingredients along the way towards a migration policy that benefits both migrant-sending and receiving countries.

According to Taylor, J.Edward, the international migration of labor is critical to how globalization and economic development are experienced by many less developed countries (LDCs). The number of international migrants, or people residing in a country other than their country of birth, has increased more or less linearly over the past forty years. International migration creates both losses and gains for the LDCs from which international migrants originate. LDCs lose millions of highly educated people where human capital often is already scarce.

LDCs also lose significant numbers of relatively low-skilled workers whose productivity and wages are far higher abroad than at home. International migrants send substantial amounts of remittances back to their countries of origin. The flow of international migrant remittances has increased more rapidly than the number of international migrants themselves. While the growth in international migration has been linear, the growth in remittances has been nonlinear. In other words, on average, each of the world’s international migrants is sending home more remittances today than in the past. It is likely that remittance figures understate true international remittance flows, which include an unknown amount of cash that does not enter countries through formal banking channels as well as goods that migrants send or carry home.

However, there is evidence that more migrants are using formal channels to remit today than in the past. Remittances make people the most important “export� of many LDCs in terms of the foreign exchange they generate.

According to International Labour Organization (2015), the ILO intervenes on the demand side of financial services. This involves working with migrant workers and the beneficiaries of remittances to strengthen their capacity to make informed/rational choices about the use of remittances and remittance-linked services. Improved financial education/inclusion can enhance the welfare of low-income households as well as support enterprises and job creation and is topical for development.

The ILO also intervenes on the supply side of financial services in order to leverage the use of remittances for income generating activi-

monopolistic market since consumers request choices in products.

The basic gravity model equation used by Tinbergen and Pohon is: Equation 1. Gravity Model Where: GMp,a Yp Ya Yp Ya Dpa Apa

= value of flow from country a to country p = GDP of country p = GDP of country a = Population of country p = Population of of country a = distance between the country p and country a = other factors that affect migration between country p and country a

= log-normally distributed error term I E(lnuij) = 0

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An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

ties. This involves working with financial institutions so that they develop adequate and innovative financial services.

According to Asian Development Bank Institute (ADBI), the Organization for Economic Co-operation and Development (OECD) in 2014, the three largest recipient countries in the world are Asian countries. India and the PRC have been leading since 2006, the Philippines has taken over the third position from Mexico.

Gravity Model. The gr avity model is an economic theor y which explains and answers the question of the size of bilateral trade flows between two countries. It is analogous with Newton’s law of gravity. This is used in analyzing patterns and performance of international trade. Dreadford says that “all that gravity equations says, after all, aside from its particular functional form, is that bilateral trade should be positively related to the distance between them” (Dreadford, 1998).

The gravity model was first applied by Tinbergen (1962) after which many had followed to use this econometric model of bilateral trade flows such as Pohonen (1963) and Krugman and Maurice (2005).

Helpman and Krugman (1985) were the ones who analyzed the effects of preferential trading arrangements on the volume of trade and economic welfare in theoretical basis. Based on their theory, products are distinguished not only by countries but also by firms that works in a

Castil, M.J. & Deri, R. B.

14

METHODOLOGY The study analyzed labor flow between the Philippines and ASEAN Member States by applying the gravity model of migration and to analyze the deployment of Philippines to ASEAN member states considering the unemployment and employment in the Philippines. More concretely, the study is trying to address the following key points: first, present the indicators per country as suggested by the gravity model. This includes macroeconomic indicators, Gross Domestic Product Ratio, GDP per Capita Ratio, Unemployment, Employment and Nominal Exchange Rate. Second, the study analyzed the significance of the microeconomic factors affecting the Labor flow between the Philippines and ASEAN Member States using the variables Remittances and Alien Employment Permit. All the information were obtained from different sources from ASEAN member states and in a sixteen-year time period ranging from 2000-2016. The major data sources are the International Labour Migration (ILO), Philippine Overseas Employment Administration (POEA), Department of Labor and Employment (DOLE), Bangko Sentral ng Pilipinas (BSP), Philippine Statistics Authority (PSA), ASEAN Statistics, and the World Bank.

In this study, Trend Analysis/Growth Rate shall be utilized in order to compare the ASEAN countries when it comes to percentage growths and shares. Panel data analysis was also used to examine the impact of the independent variables on the labor flow and deployment of the Philippines with the ASEAN countries across time.

Econometric Model Y1 = β1X0i + β2GDPr + β3GPCr + + β4Ex + β5Rem + μi Equation 2. Labor Flow Equation Y1 = labor flow per kilometer β1X0i = constant β2GDPr = GDP Ratio of the Philippines to ASEAN Country β3GPCr = GDP per Capita Ratio of the Philippines to ASEAN Country β4Ex = Nominal Exchange Rate of ASEAN Country to the Philippines β5Rem = Remittance of ASEAN Country to the Philippines μi = log-normally distributed error term Y2 = β1X0i + β2GDPr + β3GPCr + + β4UER + μi Equation 3. Relationship of Unemployment to Deployment Y2 = deployment β1X0i = constant β2GDPr = GDP Ratio of the Philippines to ASEAN Country β3GPCr = GDP per Capita Ratio of the Philippines to ASEAN Country β4Ex = Unemployment in the Philippines

μi = log-normally distributed error term

Equation 4 R elationship of Employment to Deployment Y3 = deployment β1X0i = constant β2GDPr = GDP Ratio of the Philippines to ASEAN Country β3GPCr = GDP per Capita Ratio of the Philippines to ASEAN Country β4Ex = Employment in the Philippines μi = log-normally distributed error term The equations were initially to use logarithm to transform the variables so that it will be more parallel. Frequently, the local variance of the series is larger when the level of the series is higher. When this happens, it is likely that a stationary or integrated model can be fitted after the transformation. However, after testing the unit-root, the result came out significant without having to use logarithm.

DISCUSSION OF RESULTS Many studies implemented in the field of labor economics aimed to see the connection between the labor flow and deployment of the host country. Nevertheless, the results obtained in different years by economists vary greatly and no findings were drawn to prove a relationship between these variables. Thus, the purpose of this study was to investigate the labor flow and deployment between Philippines and ASEAN Member States.

The study concurred with the conceptual and theoretical frameworks laid by scholarly studies done by individuals and institutions that in one way or another materialized to the variables. Therefore, the following conclusions and implications were drawn in view of the findings of the study: One of the objectives of the paper is to apply the Gravity Model to provide a descriptive analysis for the labor flow and deployment of Philippines between ASEAN Member States across ASEAN Member States. a) The trends of selected macroeconomic indicators of Philippines and the ASEAN Member States from 2000 to 2016 in terms GDP, GDP per capita, Nominal Exchange Rate, Employment in Philippines and Unemployment in Philippines. b) The trend of labor flow between Philippines and ASEAN Member States in terms of Deployment, Alien Employment Permit, Remittances.

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

Y3 = β1X0i + β2GDPr + β3GPCr + + β4ER + μi

15

16

c) The significance of the variables involved affecting the labor flow and deployment between the Philippines and ASEAN Member States.

LF = − 0.0022 – (0.0004)GDP_Ratio + (0.0019)GPC_Ratio + (0.0005)EXC + (2.35e-07)REM + e Equation 5. L abor Flow among A SEA N M ember States

Castil, M.J. & Deri, R. B.

Table 2. Econometric Model #1: Labor Flow among ASEAN Member States Coefficient

Std. Error

t-ratio

p-value

const

−0.00217438

0.00253864

−0.8565

0.3931

GDP_Ratio

−0.000355783

0.000193012

−1.843

0.0673

GPC_Ratio

0.00189848

0.00124743

1.522

0.1302

EXC

0.000455375

0.000139634

3.261

0.0014

***

REM

2.35353e-07

7.66313e-09

30.71

<0.0001

***

*

Mean dependent var

0.018367

S.D. dependent var

0.054229

Sum squared resid

0.035975

S.E. of regression

0.015591

R-squared

0.919518

Adjusted R-squared

0.917343

F(4, 148)

422.7326

P-value(F)

7.26e-80

Log-likelihood

422.0885

Akaike criterion

−834.1770

−819.0248

Hannan-Quinn

−828.0219

0.421912

Durbin-Watson

1.088535

Schwarz criterion rho

Source: Researcher’s computation using Gretl

DLY = 53990.6 – (0.00393569)UER – (663.989)GDP_Ratio – (6134.38)GPC_Ratio + e Equation 6. R elationship of Deployment among A SEA N M ember States to Unemployment in the Philippines Table 3. Econometric Model #2: Relationship of Deployment among ASEAN Member States to Unemployment in the Philippines Coefficient

Std. Error

t-ratio

p-value

Const

53990.6

16742.3

3.225

0.0015

***

UER

−0.00393569

0.00226316

−1.739

0.0841

*

GDP_Ratio

−663.989

337.818

−1.966

0.0512

*

GPC_Ratio

−6134.38

1894.90

−3.237

0.0015

***

17 13187.92

S.D. dependent var

31436.54

Sum squared resid

1.28e+11

S.E. of regression

29360.81

R-squared

0.144915

Adjusted R-squared

0.127698

F(3, 149)

8.417223

P-value(F)

0.000033

Akaike criterion

3586.091

Hannan-Quinn

3591.015

Durbin-Watson

0.091346

Log-likelihood Schwarz criterion

−1789.046 3598.213

Source: Researcher’s computation using Gretl

DLY = −37579.8 + 0.000746182(ER) – (675.624)GDP_Ratio – (5658.40)GPC_Ratio + e Equation 7. R elationship of Deployment among A SEA N M ember States to Employment in the Philippines Table 4. Econometric M odel #3: R elationship of Deployment among ASEAN Member States to Employment in the Philippines Coefficient const ER

Std. Error

t-ratio

p-value

24141.4

−1.557

0.1217

0.000746182 0.000282294

2.643

0.0091

***

−37579.8

GDP_Ratio

−675.624

333.545

−2.026

0.0446

**

GPC_Ratio

−5658.40

1886.20

−3.000

0.0032

***

Mean dependent var

13187.92

S.D. dependent var

31436.54

Sum squared resid

1.25e+11

S.E. of regression

28985.47

R-squared

0.166638

Adjusted R-squared

0.149858

F(3, 149)

9.931249

P-value(F)

5.22e-06

Akaike criterion

3582.154

Hannan-Quinn

3587.078

Durbin-Watson

0.086067

Log-likelihood Schwarz criterion

−1787.077 3594.276

Source: Researcher’s computation using Gretl

CONCLUSION In the study, a panel data analysis was conducted to measure the degree of significance between the independent and dependent variables as represented by their indicators. The results show the following implications:

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

Mean dependent var

18

a) Findings provide evidence that indicates the statistical significance of Labor Flow to GDP Ratio, Nominal Exchange Rate and Remittances. While GDP per Capita Ratio, do not have a statistical significance to Labor Flow.

Castil, M.J. & Deri, R. B.

b) Moreover, findings provide evidence that indicates the statistical significance of Deployment to GDP Ratio, GDP per Capita Ratio and Unemployment. c) Finally, findings provide evidence that indicates the statistical significance of Deployment to GDP Ratio, GDP per Capita Ratio and Unemployment.

POLICY RECOMMENDATIONS The paper applied the Gravity Model and analyzed the labor flow and deployment between Philippines across ASEAN Member States. The following recommendations were suggested after the findings and conclusion were reached: Economic development entails decent work and economic growth for the betterment of life on a local, regional, national or global level. As straightforward as this formula for economic development seems - technical, structural, fiscal and monetary factors must be examined and secured to promote this. The challenge before that task is the notable reality that hindrances on deployment are still evident and must be addressed.

Moreover, GDP per Capita became insignificant in the model where labor flow was the dependent variable. This indicator is the closest indicator that would represent the country's standard of living or the average capacity of the people to purchase. The main driving force of migrations turned out to be the wage disparities and therefore, ASEAN authorities and policymakers of both developing and developed countries should clearly change the approach in dealing with the phenomenon of migration. They should implement drastic reforms and concrete measures to minimize the number of individuals who leave their country for economic and social reasons.

In the case of the Philippines, the idea is different. Remittances keep on increasing over the years as the job opportunities in ASEAN member states alone increases as well. Therefore, the Department of Labor and Employment together with its agencies such as the Philippine Overseas Employment Administration must exert more effort to process and maximize the job orders requested by not just ASEAN countries but also the others. The country is faced with abundant shortcomings and therefore must prioritize on where it is facile progress.

The government must also consider and do actions regarding the language barriers that hinders the Filipino workers to migrate to CLMV countries. They must also assure that the labor bilateral agreements

19

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

among ASEAN Member States are deliberately revised as needed and are thoroughly implemented.

Finally, with an average of 8.2 percent, utilizing the actual value of unemployment scored a high significance in deployment. This implies that the Philippine government must immoderate on generating jobs and encourage the unemployed to be productive since it becomes a hindrance in the advancement of deployment. Probably they can facilitate seminars with actual activities that will initially entice the unemployed to be productive.

-1.109

t-ratio

-5.739

1.141

z-score

There is No Unit Root (stationary)

There is No Unit Root (stationary)

There is Unit Root (non-stationary)

Remarks

-14.223

-17.455

-16.398

t-ratio

-13.581

-13.186

-14.305

z-score

There is No Unit Root (stationary)

There is No Unit Root (stationary)

There is No Unit Root (stationary)

Remarks

1st Difference

Intercept -9.245

2.857

1st Level

Trend and Intercept 3.011

Variables

Annex Table 5. Result of Levin Lin Chu Test: Econometric Model #1

Labor Flow None Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

1.289

VIF

No Multicollinearity

No Multicollinearity

REMARKS

Annex Table 6. Variance Inflation Factor for Econometric Model #1

1.735

No Multicollinearity

GDP Ratio

2.122

No Multicollinearity

GDP_Ratio

Exchange Rate

1.568

Castil, M.J. & Deri, R. B.

GDP per Capita Ratio

EXC

Remittances

GPC_Ratio

REM Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

20

No Autocorrelation Error is normally distributed

Heteroscedasticity is not present Use random-effect model

Durbin-Watson

Normality

Breusch-Pagan Lagrange Multiplier

Hausman

-6.359 2.168

None

-1.262

Trend and Intercept

Intercept

t-ratio

1st Level

2.051

-2.447

0.864

z-score

-10.1 -8.837

There is Unit Root

-9.913

There is No Unit Root (stationary) There is Unit Root (non-stationary)

t-ratio

Remarks

-8.448

-5.506

-6.956

z-score

Remarks

Accept

Accept

Accept

Accept

Remarks

There is No Unit Root

There is No Unit Root (stationary)

There is No Unit Root (stationary)

1st Difference

6.6199e-005

1.43231e-025

0.00000

1.088535

Result

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

Deployment of Philippines

Variables

Annex Table 8. Result of Levin Lin Chu Test: Econometric Model #2

Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

Null Hypothesis

Statistical Tests

Annex Table 7. Test for adequacy, normality and heteroscedasticity: Econometric Model #1

21

Unemployment

1.113

1.015

No Multicollinearity

No Multicollinearity

No Multicollinearity

Annex Table 9. Variance Inflation Factor for Econometric Model #2 UER GDP Ratio

1.129

REMARKS

GDP_Ratio

GDP per Capita Ratio

VIF

GPC_Ratio Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

Durbin-Watson

Statistical Tests

Error is normally distributed

No autocorrelation

Null Hypothesis

4.43619e-061

1.42837e-206

0.0913457

Result

Accept

Accept

Accept

Reject

Remarks

Annex Table 10. Test for adequacy, normality and heteroscedasticity: Econometric Model #2

Normality

Heteroscedasticity is not present

0.275007

Lagrange Multiplier

Breusch-Pagan

Use random-effect model

Hausman

Castil, M.J. & Deri, R. B.

Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

22

-1.262

-6.359

2.168

Trend and Intercept

None

t-ratio

Intercept

2.051

-2.447

0.864

z-score

1st Level

-10.1

-8.837

There is Unit Root (nonstationary) There is Unit Root (nonstationary)

GDP Ratio GDP per Capita Ratio

GDP_Ratio

GPC_Ratio

Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

Employment

ER

1.147

1.114

1.032

-9.913

There is No Unit Root (stationary)

There is No Unit Root (stationary)

There is No Unit Root (stationary)

There is No Unit Root (stationary)

Remarks

No Multicollinearity

No Multicollinearity

No Multicollinearity

REMARKS

-8.448

-5.506

-6.956

z-score

1st Difference

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

VIF

t-ratio

Remarks

Annex Table 12. Variance Inflation Factor for Econometric Model #3

Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

Deployment of Philippines

Variables

Annex Table 11. Result of Levin Lin Chu Test: Econometric Model #3

23

Heteroscedasticity is not present

Error is normally distributed

No autocorrelation

Null Hypothesis

0.14254

1.30751e-065

0.00000

0.0860674

Result

Accept

Accept

Reject

Reject

Remarks

Castil, M.J. & Deri, R. B.

Use random-effect model

Annex Table 13. Test for adequacy, normality and heteroscedasticity: Econometric Model #3 Statistical Tests Durbin-Watson Normality Breusch-Pagan Lagrange Multiplier

Hausman

Source: Researcherâ&#x20AC;&#x2122;s computation using Gretl

24

25

An Application of Gravity Model Analysis to Labor Flow and Deployment between the Philippines and ASEAN Member States

REFERENCES Abella, M. (2013). “Effects of Labour Mobility: An Analysis of Recent International Development Literature. The International In digenous Policy Journal”. Vol.4,Issue 3. Retrieved from: http://ir.lib.uwo.ca/cgi/viewcontent.cgi?article=1133&context=ii pj Abella, Manolo I. (1993). “Labor Mobility, Trade and Structural Change: The Philippine Experience”. Retrieved from:http:// www.smc.org.ph/administrator/uploads/apmj_pdf/AP MJ1 993N3ART1.pdf Amin,R.M., Hamid, Z., Saad, NMD ,(2009). “Economic Integration Among ASEAN Countries: Evidence from Gravity Model”. Ret rieved from:http:// irep.iium.edu.my/13561/1EADN_Working_Paper_N o._40.pdf Anderson, James E., and Eric van Wincoop. 2003. "Gravity with Gravitas: A Solution to the Border Puzzle."A merican Eco nomic Review, 93(1): 170-192.

ASEAN Briefing (May 13, 2016). “Labor Mobility in ASEAN: Current Commitments and Future Limitations”. Retrieved from: https://www.aseanbriefing.com/news/2016/05/13/asean-labor- mo bility.html Asian Development Bank Institute (ADBI), the Organisation for Economic Co-operation and Development (OECD), and the International La bour Organization (ILO) (2014). “Labor Migration, Skills & Stu dent Mobility in Asia”. Retrieved from: https://www.oecd.org/ migration/Labour-migration-skills-student-mobility-in-Asia.pdf Asis M.B., Maruja (January 1, 2006). “The Philippines’ Culture of Mi gration”. Migration Policy Institute (MPI). Retrieved from: https://www.migrationpolicy.org/article/philippinesculture-migration Caliendo, Marco (November 26, 2009). “Labour flows, transitions and unemployment duration”. Institute for the Study of Laboor (IZA).

Retrieved from: http://ec.europa.eu/social/BlobServlet?

Do cId=4286&langId=en Center for Migrant Advocacy, (September 2014). “Philippine Labor Mi gration and the ASEAN Economic Community Project”.

Re trieved from: https:// centerformigrantadvoca cy.files.wordpress.com/2014/04/philippine-labor-migration-andthe-asean-economiccommunity-project.pdf Chuikina, Viktoriya and Fard, Sara Azmoudeh (June 7, 2012). "The ef fects of immigration on unemployment. A case study of Sweden and the UK". Retrieved from: http://www.diva-por tal.se/smash/get/ diva2:536521/ FULLTEXT01.pdf C. and GoGwilt, C. (August 18, 2008) “International migration beyond gravity: A statistical model for use in population projections”.

Retrieved from:http://www.pnas.org/content/105/40/15269.full Cu, Gyllea O.Kim, So HyunNaga, Princess Emeresa A.(2015).

“ASEAN-5 countries: Panel Data Analysis on the Impact of

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Foreign Direct Investment, Openness, and Fixed Capital Formation on the Economic Growth”. Retrieved from: http:// www.academia.edu/4408795ASEAN5_countries_Panel_Data_Ana lsis_on_the_Impact_of_Foreign_Direct_Investment_Openness_an d_Fixed_Capital_F orma tion_on_the_Economic_Growth Gallaway, L. E., Gilbert, R. F., Smith, P. E. (June 1967). “The Economics Of Labor Mobility: An Empirical Analysis” Vol. 5, Issue 3. pp.

211–223. Retrieved from:http://onlinelibrary.wiley.com/ doi/10.1111/j.1465- 7295.1967.tb01922.x/full Greenwood, Michael J., (19XX). “Modeling Migration”. Retrieved from: https://www.colorado.edu/Economics/courses/spring12-4292- 001/ Modeling%20Migration.pdf Hussin, Fauzi and Saidin, Nooraini (July 30, 2012). “Economic Growth in ASEAN-4 Countries: A Panel Data Analysis”. Canadian Cen ter of Science and Education. Retrieved from: http://www.ccsenet.org/journal/index.php/ijef/article/viewFile/19 342/13299 International Labour Migration, (n.d.). “A migrant centred approach to remittances”. Retrieved from: http://www.ilo.org/global/topics/ labour-migration/policy-areas/remittances/lang--en/index.htm Kim, Keuntae and Cohen, Joel E. (2010). “Determinants of International Migration Flows to and from Industrialized Countries: A Panel Data Approach Beyond Gravity”. Retrieved from: http:// lab.rockefeller.edu/cohenje/PDFs/368KimCohenInternatio nal MigrationFlowsInternatio nalMigration.pdf Poot, J., Alimi, O., Cameron, M.P., and Maré, D.C., (October 2016). “The Gravity Model of Migration: The Successful Comeback of an Ageing Superstar in Regional Science”.

Retrieved from: http://ftp.iza.org/dp10329.pdf Taylor, J. Edward (n.d.). “The Relationship Between International Mi gration, Trade, and Development: Some Paradoxes and Findings”.Retrieved from: https://www.dallasfed.org/VfbUf/ assets/documents/research/.../ migration/taylor.pdf Testaverde, M., Moroz, H., Hollweg, C.H. and Schmillen, A, (October 8,2017). “Migrating to Opportunity: Overcoming Barriers to La bor Mobility in Southeast Asia”. Retrieved from: https:// books.google.co.uk/ World Bank, (2010). “The ASEAN economic community in 2015 : im plications on labor migration to and from constituent countries”.

Retrieved from:http://siteresources.worldbank. org/ TOPICS/Resources/214970-1288877981391/Migration &Development-Ratha- GFMD_2010a.pdf Yamarik, S., and Ghosh, S. (2005), “A sensitivity analysis of the gravity model,” The International Trade Journal, Vol. 19, no. 1, pp. 83126.

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon Paulina Mariea P. Labayo & Maybelle Gallardo San Beda University

Abstract The study is about learning the effects of programs to the indigent sector of the elderly, specifically in the area of Barangay Tatalon. The barangay is known for having majority of indigent senior citizen residents who do not have the means to sufficient resources. The measurement was done by considering the access, effectivity, perception, perceived effects, purpose, roles and decision-making process of the elder residents. In line with the given factors, the researcher aligned them with their economic status, general health condition and social and family life. The researcher selected seven major programs to be studied on specifically; Senior Citizen ID, QC Emergency Medical Benefit Assistance for Senior Citizens, Vaccine Prevention, Mandatory Philhealth Coverage, DSWD Social Pension Fun, Social Safety Net, Death Benefit Welfare Assistance.

JEL Classification: I3. ,I380 Keywords: Entitlements, Social Welfare Programs, Public Assistance, Welfare Effects, Well-being

INTRODUCTION Filipinos are known for their hospitable and family-oriented culture.

Families living in one home with their grandparents are widely acceptable and common in the country. According to the 1987 Constitution in Article XV Section 4, "It is the duty of the family to take care of the elderly members while the State may design programs of social security for them". This is rooted from the belief that children who were brought up by the love and care of their parents, are expected to return the favor when they already become independent.

Because of this, time, space, and resources are shared with the grandparents

Labayo, P.M. & Gallardo, M.

28

while they receive some support from the government as well. Filipinos give value to relationships and practice pagtanaw ng utang na loob or giving back in good will. That is why there is an implied obligation to look after the elderly who have nurtured them when they were still young.

Thus, taking care of their aged family members, they are returning the effort of elderly citizens who have helped exalt the society.

In the earliest form of government, the Datu, leader of the tribe, had his own council of elders who functioned as advisers and consultants in making laws. Elderly women called Babaylan, also took a significant role of being presiders of religious rites and healing. Their word was received with respect and their capabilities with awe. When the Spaniards came to colonize the country, Catholic friars who occupied and converted Filipinos into their teachings insisted that the Indios or the native people, kiss their hand, as a sign of power over them. This was also done by the Pope who was superior and would extend his hand to priests, nuns & lay people to kiss his signet ring while he gave his blessings. This practice was carried over and is now known as pagmamano. Therefore, elders are given regard and importance until the contemporary times. However, certain factors were brought by time that changed certain perceptions and conditions towards elderly people. Instead of giving back to elders and letting them enjoy the fruits of their labor, some of them are still depended on or have nowhere to go. If Filipinos were so conscious about this tradition, why do we see poorer elders still straining themselves despite disability and old age just to make ends meet? For example, homeless people who are displaced on the streets will eventually grow old and be a part of the senior population. Even though they were seen as an eyesore or a parasite during their younger years, it is not humane to discriminate them and label them as useless (Sleap, 2011). That is why the government still extend their help even to the marginalized sector. It is their duty to look out for everyone and adapt to the growing needs of elders. But the irony lies in the reason behind poor senior citizens who live in harsh conditions despite the positive claims of the society. Having poor elders is contradicting to the Filipino trait of being grateful and respectful. There must be an existing failure on either the elder, the families, the community or even the government. The essence of this particular thought of the researcher will be explored thoroughly in this paper.

OBJECTIVES OF THE STUDY The objectives of this study are to measure the effects of the government programs for senior citizens to the existence of indigent senior citizens. This study seeks to understand and define the current state of indigent senior citizens in the society, along with other conditions of the present time. Specifically, this study aims to know how the current status of government programs is significant to indigent senior citizens. It assesses the access, utilization, implementation, and perceived effects of the government programs to the indigent senior citizen while also evaluating

REVIEW OF RELATED LITERATURE In dealing with the evaluation of government intervention to indigent communities, the researcher strongly believes the power and positive effects that it could do to alleviate the situation of senior citizen indigents. To support this claim, Mohyuddin and Rehman (2015) wrote a study entitled “Economic Issues of Senior Citizens”, where they explained the huge role of the government in being responsible for the elders’ welfare.

It is evident that there is a major effect of modernization on the life of older people that is why some have a hard time to adapt to these changes. The government must understand these issues and give its attention to the elders through various kinds of entitlements or privileges. Some of the duties highlighted for most of the senior citizens are; health insurance, discount on medicine, seminars for senior citizens, social security. Transport facilities, economic support. The idea of state intervention does not only come from a political point of view.

Thakur (2008), wrote an analysis on proving that state intervention is necessary when it comes to the veneration of elders due to tradition. He stressed that there is a responsibility towards senior citizens by framing legislation that dictates terms of affection and care between family members. The complexity of the ageing population requires different kinds of policies with an approach of mix fiscal instruments for social security and health care. Thakur concluded that the governing cultural mores expect the children of the elders to take the roles of care givers and nurturers. An example of government involvement is a study on Senior Citizen Grant in Uganda that was written by Bukuluki (2012) regarding the success of monthly transfers targeted for older people. It has not only enabled beneficiaries to meet basic needs for themselves but also for their families. This including food, medicine, soap, and education for grandchildren in their care but have also facilitated productive investments, savings and access to credit, and enhanced beneficiaries’ feelings of self-worth and dignity while strengthening their sense of social connectedness and their sense of value within their family and community. This proves that there is a possibility to not only up lift the lives of the indigent senior citizens, but also reap positive externalities from doing so.

29

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

the respondent’s purpose, roles, responsibilities and decision-making skills. Furthermore, the study intends to understand and realize the implications of the said government programs to the economic conditions, general health conditions, social and family life, and level of empowerment of the indigent senior citizens. This then helps the study in the formulation of viable recommendations for the improvement and enhancement to meet the growing diverse problems and issues faced by the indigent senior citizens.

Labayo, P.M. & Gallardo, M.

30

In study of Lim (2010) entitled “Empowering Citizens’ Voice in the Era of E-Government: Implications from South Korean Cases”, mentioned that the citizens’ access to government is a key issue to public administration. There were many impediments mentioned to the access of policy processes such as red tape, high transaction cost and insufficient knowledge and information. Only an understanding and secured environment could really solve the problem.

According to Oxford academic adviser, Sanchez (2008), there is a rapid increase with the absolute number of Filipino senior citizens. In his analysis entitled “The Filipino Senior Citizen At A Glance” pertains that the increase is attributed to its declining fertility rate and increasing life expectancy and the density of Filipinos that are becoming 60’s. He stated that the population will continuously increase in a very fast phase, making it as a challenge that will leave the country unprepared to respond to this occurrence that would threatened its strong familial relationship and unforeseen impact to its culture, society and economy.

The study of Deshmukh, Dongre, Rajendran & Kumar (2015) had specific conclusions on older people’s gender differences. They found that old men perceived better quality of life better than old women. It was due to inequality of distribution of social capital and cultural capital between male and female sex, favoring males. It was reported that age, sex, and occupations are the determinants of morbidity among old age people and that those with higher morbidity had increasing disability and distress. Policies and programs for old people need to be pro-women and should focus on strategies for the reduction of risk factors or prevention of chronic morbidities among old age people for ensuring better QOL. Hwang, Lin, Tung & Wu (2006) conducted a study entitled “Correlates of perceived autonomy among elders in a senior citizen home: A cross-sectional survey”. Researchers have pointed out several factors that correlated with or influenced autonomy in older people. It covered a range of socio-demographic or physical factors, while factors from psycho-sociological and spiritual domains remain ignored. It was found that the perceived autonomy is influenced by social support, functional ability, life attitude, and literacy among institutionalized elders.

The political set up of the Philippines needs to keep up with the new problems that arise from the elders. Aside from the older people needing to adapt, the government need to address these changes as well.

In “Concerns of the Elderly in the Philippines” a study conducted by Carlos (1999), demographic changes resulting from rising life expectancy and falling fertility rates have made an impact on different economic concerns including poverty, inflation, and growth In the recent study of Antonio (2015) entitled “Filipino Senior Citizen’s Care Management: Current Status of Local Government Unit’s Response” LGUs are required by law to take part in the implementation of national laws that provide discount to senior citizens and mandates the construction of a senior center to cater to the needs and the general wellbeing of the elderly.

METHODOLOGY This study analysed the effectiveness of government programs to the indigent senior citizens. With the help of the Quezon City’s Office of Senior Citizen’s Affairs, the study was able to determine the barangay in which to conduct the study. Senior Citizen that were residents of Barangay Tatalon were chosen and then interviewed to assess the status of government programs with regards to their old age specifically, economic status, general health condition, social and family life and level of empowerment. The study utilized primary data through survey questionnaires as its source in understanding the effects of government programs to the respondents. The study applied descriptive, cross-sectional and correlational analysis to comprehend and achieve the study’s objectives.

Econometric Model. The researcher used the statistical tools in order to present in a clear manner the outcome of the research. The regression will be run using Microsoft Excel and Gretl software. It will be run using cross data analysis. For this study, there will be a general which is stated below.

Equation 1. Regression Equation Where:

Where:

Y= Dependent Variable = Constant term or intercept = Partial Regression coefficient; each regression coefficient represents the amount of deviation of the group identified in the dummy variable from the mean of the reference category.

Random error Dependent Variables ECON = Economic Conditions

31

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

Racelis, Abrigo, and Salas (2012) did a study on “Filipino Elderly Living Arrangements, Work Activity and Labor Income as Oldage” and emphasized on the access to programs and benefits. Their work stated that the respondents in the urban areas received more benefits than their rural counterparts are more likely to report satisfaction with the availability and accessibility of programs and benefits for senior citizens. Their survey data show that the urban elderly was able to use their senior citizen cards more widely than those who lived farther.

32

GEN = General Health Conditions SOC = Social and Family Life EMP = Level of Empowerment

Labayo, P.M. & Gallardo, M.

Independent Variables AUP = Access and utilization of government programs EIP = Effective implementation and delivery of quality of programs PEP = Perceived effects of programs for indigent senior citizen POA = Perceptions about old age POL = Purpose of life RRS = Roles and responsibilities as a senior citizen DMP = Decision making process

DISCUSSION OF RESULTS Demographic Profile. In the study conducted, the female respondents outnumbered the male. Out of the 133 senior citizens interviewed, 62% were female. 40% of the respondents were in the age group 60-65 years. As to the marital status, most of respondents were married, having 44% share followed by widowed seniors who amounted to 38% share. The educational attainment of barangay Tatalon’s senior citizens mostly did not get to finish college because only 24% of the respondents classified themselves as college graduates while the rest did not. Although, among those who did not finish college, the commonly attained level of education was elementary graduates having 21% share, followed by high school graduates. Most of the seniors in the barangay lives with their children and/or grandchildren but not with their spouse. This is connected to the respondent’s marital status of widowed and separated combined, outnumbering married set-ups. The senior citizens of the barangay mostly owned their houses. This is due to the organizations such as Gawad Kalinga and the fact that the residential area had small cuts of the area which make it somewhat affordable to own a lot. Meanwhile, there were 45 respondents who rented their home which implies that there were a lot of available apartments made into business within the area.

Economic Status. The level of economic condition shows the percent distribution of the respondents’ overall economic status derived from questions expressed in Likert’s. The results show that the level of the respondent’s economic condition is generally ‘good’ out of the grand weighted mean of 2.89.

General Health Condition. Results show that going to the hospital in case of emergencies is not a problem because in all hospitals were said to be accessible. The results for availability on medical service, confidence on paying for medical bills, satisfaction on medical

33

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

services and willingness to participate showed â&#x20AC;&#x153;Agree: result. This is due to the fact that most of them are comfortable with their Mandatory Philhealth insurance and in the knowledge that their families and the barangay are able and willing to provide for their medical needs.

Social and Family Life. Results show how a senior citizen relates with the family and the community. Most of the respondents were generally having a good relationship with their family due to the fact that the weighted mean for this garnered a good 4.503. Along with this positivity, the relationship with the community and social adaptability resulted high weighted means which indicates that elders in the barangay have good bonding with their neighbourhood and are united.

Level of Empowerment. Results show that respondents from the area had a bias in favouring the services of the barangay more than the city government due to the result of 2.105 for Q.C. government against 4.203 of the barangay. They also are dependent of confident in helping themselves because of the 3.99 weighted mean for this aspect.

Access and Utilization of Government Programs. F indings stated that, senior citizens had consistently responded positively on the senior citizen ID benefits. The Q.C. emergency medical benefit fund was not very popular among the respondents and claimed that it was only granted through â&#x20AC;&#x153;palakasanâ&#x20AC;? system. The Vaccine Prevention program was utilized by most of the seniors in the barangay while the others were scared of its side effects regardless of it being given free and guaranteed. Philhealth benefit were also known to the elders and most of them were members except for some remaining who do not know or want to undergo the tedious process of acquiring it that is why it garnered a mean of 4.075. The social pension fund was usually frowned upon since they claimed that the program was disorganized and unfair.

The death benefit welfare assistance had many unsure responses because the barangay had an informal death assistance that were more popular among the seniors Effective Implementation and Delivery of Quality of Programs. The most effective implementation base from the weight of the means from respondents was the senior citizen id card. Another program that was deemed effective by the researcher is the mandatory PhilHealth Coverage for senior citizens. 63% of the respondents claimed that the PhilHealth program that they availed were necessary to have and convenient to use. The Vaccine Prevention program is implemented by the barangay to prevent sickness such as influenza and pneumonia. There were 56% of respondents who claimed to have participated in the vaccination and thought that it was a good program for the seniors.

Perceived Effects of Programs for Indigent Senior Citizens.

The variable of perceived effects of programs for indigent senior citizens distinguish the common predictions of the respondents on a personal level. Most of the respondents think that the programs had a somewhat inconvenient scheme of application and information dissem-

Labayo, P.M. & Gallardo, M.

34

ination but were still possible to avail amidst the difficulties. Almost all of the respondents agree that they are fully entitled to the benefits given by the government because they believe that they deserve to be respected and gratified. On the other hand, the respondents could not exactly claim that the programs brought them significant changes in their income and budget constraints in being able to afford various commodities. They couldnâ&#x20AC;&#x2122;t also claim that the programs made their lifestyle better in general because the effects for them, caused minimal changes.

Perception About Old Age. Majority of the respondents had accepted their old age and are not wishing to go back to being young. This can be seen based on the 68% who answered that they are happy with the wisdom and relationships the old age has brought and on the 28% who preferred their lifestyle as a senior than their lifestyle during their youth.

Most of them experienced a lot of struggles in their early years. They claimed that old age made them more relaxed because of the lesser responsibilities over their families and the benefits that they receive as seniors.

Purpose of Life. The variable of purpose of life shows the level of how the senior citizens define what they have achieved and what they are currently doing in general. 51% of the respondents have hope that they can still achieve their goals and dreams in the future even in their old age. Although 29% had some regrets with what they have achieved in life, majority still remain persevered to make their lives better. Their purpose in life was also determined by the how much they think they have contributed to the family and to the community. 70% of the respondents believe that they have positively contributed in the development of the country in their own little way such as lending their neighbours money and basic commodities when they are in need.

Roles and Responsibilities as a Senior Citizen. The respondents of Tatalon more or less are sure of their exact responsibilities towards their family and community, having 56% and 44% respondents firm on their roles respectively. They give a greater priority over their families more than the community which shows that they are family oriented more than service oriented. The level of independence determines their ability to provide basic needs for themselves without having to wait for other peopleâ&#x20AC;&#x2122;s help. It shows that 53% of the respondents are independent where the majority of them come from the P5,000-P14,999 income bracket instead of the P15,000 and up income bracket. This justifies the theory on Subjective Well-Being that there are other factors than income which determine the individualâ&#x20AC;&#x2122;s evaluation and perception of themselves.

Meanwhile, the response for their capacity to help others were inconclusive since they cannot determine to what extent can they be altruistic for their neighbours. This can be correlated to their trait of being family oriented more than service oriented.

Decision Making Process. Results show that 53% of the respondents are able to openly express their opinions to the barangay. Most of them come from the P15,000 and up income bracket which could im-

35

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

ply that the economic status gives a person confidence in stating opinions. 56% of the respondents think that the barangay listens and considers the opinions of the elders in decision making. Most of them again, come from the high-income bracket which indicate the same mentality towards authorization where the more money you have, the more your thoughts matter.

Econometric Models. The numerical coefficients in the OLS regression results will not literally interpreted rather the study focuses on the signs of the coefficients and the p-values of each variable.

The results for regression model 1 has indicated an R-squared value of 0.203 meaning 20.3% in the variance of economic condition can be explained by the independent variables, Access and utilization, Effective implementation and delivery of quality of programs, Perceived effects of programs, Perceptions about old age, Purpose of life, Roles and responsibilities, Decision making process. Although, the value of R-squared is low, this does not indicate that the model is insignificant. Meanwhile on relying on the t-ratio for the hypothesis testing, only perception and decision made it over 2 t-ratio. They yielded 3.772 and 2.064 respectively, which means they are statistically significant according to t-ratio. The overall significance of the model is measured

by F- test or P-value, by which in the model indicates that the model is significant having a 0.000154 p-value.

The regression of model 2 has indicated an R-squared value of 0.284 meaning 28.4% in the variance of general health condition. Although, the value of R-squared is low, this does not indicate that the model is insignificant. Meanwhile on relying on the t-ratio for the hypothesis testing, only effects, perception and purpose made it over 2 tratio. They yielded 2.551, 2.749, 2.571 respectively, which means they are statistically significant according to t-ratio. The overall significance of the model is measured by F- test or P-value, by which in the model indicates that the model is significant having a 3.96E-07p-value.

The regression model 3 has indicated an R-squared value of 0.165 meaning 16.5% in the variance of social and family life. Although, the value of R-squared is low, this does not indicate that the model is insignificant. The overall significance of the model is measured by F- test or P-value, by which in the model indicates that the model is significant having a 0.002 p-value.

The regression model 4 has indicated an R-squared value of 0.139 meaning 13.9% in the variance of level of empowerment. Although, the value of R-squared is low, this does not indicate that the model is insignificant. Meanwhile on relying on the t-ratio for the hypothesis testing, only variable for decision made it over 2 t-ratio. They 3.624, which means they are statistically significant according to t-ratio The overall significance of the model is measured by F- test or P-value, by which in the model indicates that the model is significant having a 0.002 p-value

Table 1. Composite Mean and verbal Interpretation of the Independent Variables

Roles and Responsibilities

Purpose of Life

Perception on Old age

Perceived Effects of Program

Implementation & Delivery quality of program

Access and utilization of Govâ&#x20AC;&#x2122;t Program

4.54 (SA)

3.78 (A)

4.13 (A)

3.51 (A)

3.44 (A)

3.07 (NAD)

2.94 (NAD)

Php15,000 & up

3.80 (A)

4.23 (SA)

4.12 (A)

4.07 (A)

3.80 (A)

3.79 (A)

3.29 (NAD)

3.28 (NAD)

Php14,999 -Php5,000

3.52 (A)

4.15 (A)

3.86 (A)

3.90 (A)

2.86 (NAD)

3.21 (NAD)

3.37 (NAD)

3.32 (NAD)

Below Php5,000

4.25 (SA)

3.94 (A)

4.00 (A)

3.63 (A)

3.47 (A)

3.20 (NAD)

3.23 (NAD)

TOTAL

COMPOSITE MEAN and Verbal Interpretation

Decision Making Process

3.63 (A)

STATEMENTS

COMPOSITE MEAN

Labayo, P.M. & Gallardo, M.

Source: Survey administered by the Researcher Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Neither Agree nor Disagree (NAD); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

36

4.27 (SA) 4.69 (SA) 3.41 (A) 4.05 (A)

General Heath Condition

Social and Family Life

Level of Empowerment

COMPOSITE MEAN 3.77 (A)

3.49 (A)

4.42 (SA)

4.25 (SA)

2.90 (NAD)

Php14,999 -Php5,000

3.67 (A)

3.39 (NAD)

4.80 (SA)

4.00 (A)

2.47 (D)

Below Php5,000

3.43 (A)

4.63 (S)

4.14 (A)

2.89 (NAD)

TOTAL

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

Source: Survey administered by the Researcherâ&#x20AC;&#x2122; Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Neither Agree nor Disagree (NAD); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

3.84 (A)

Php15,000 & up

Economic Status

STATEMENTS

COMPOSITE MEAN and Verbal Interpretation

Table 2 Composite Mean and verbal Interpretation of the Dependent Variables.

37

Purpose of Life

Perceptions on Old Age

Perceived Effects

Implementation and Delivery Quality

Access & Utilization

Constant

-0.163

0.029

0.552

0.016

0.065

0.494

-2.737

Model 1 Economic Status

0.086

-0.046

0.166

0.149

0.144

0.344

0.020

0.943

Model 2 General Health Condition

0.118

0.197

-0.009

0.014

0.096

-0.015

0.154

0.091

1.696

Model 3 Social and Family Life

0.008

0.090

0.075

0.224

0.002

0.141

0.020

-0.450

0.602

0.933

Model 4 Level of Empowerment

Table 3. Results from Regression Analysis

Roles and Responsibilities

0.421

0.244

0.002

Estimtion of Parameters

Decision Making Process

0.158

0.000000396

Adjusted R-squared

0.000154

P-value(F)

Labayo, P.M. & Gallardo, M.

Source: Survey administered by the Researcher

38

After conducting all necessary presentation, interpretation, analysis and statistical tests, the present the following conclusions.

Respondent’s Profile. The r espondents of this r esear ch study are classified by their socioeconomic class. The respondents are characterized mainly by females since it outnumbered the males. Majority got married and are family oriented. More than half of the respondents completed college. Most of the respondent’s housing condition was owned houses.

Status of the Senior Citizens. Gener ally, the senior citizens rated their economic status as ‘good’ which implies that despite their low income bracket, they can get though their daily expenses. The senior citizens also have a positive general health condition where most of them do not have a severe health conditions. Situations that needs hospitalization are not a big worry since they have a good response to health programs such as PhilHealth, vaccine preventions. Furthermore, their senior citizen I.D. that covers on giving discounts on almost all medical needs. There were also a number of nearby hospitals with accessible transportation readily available to the elder residents. The data gathered about social and family life showed that respondents in the barangay are connected with one another due to strong favor of barangay officials for elders and consistent encounters with one another.

It should be noted that most of the respondent did not have full confidence in the way the Quezon City government allocates their resources making them depend more on the visible entity which has direct relationship with them, the barangay.

Significance of the Government Program to the Senior Citizens of Brgy. Tatalon. Regar dless of the income status, per ception about old age, purpose of life, roles and responsibilities and decision making process seemed to be varying but generally positive. Their Senior Citizen ID card proved to be very helpful due to their knowledge and usage of its different benefits. Residents in the barangay are generally hopeful for improvements and yet satisfied with their economic status. Although, they =feel like they are not receiving enough from the local government because their economic status did not change because of the benefits they receive. Numerous complaints regarding the implementation of the social pension programs were cited by the senior citizens to be weak and ineffective.

39

Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

CONCLUSIONS

40

POLICY RECOMMENDATIONS The findings of this research study served as are the bases of the researcher for the recommendations. The researcher takes into the consideration that the recommendations should be practical and achievable by individuals and/or government agencies.

Labayo, P.M. & Gallardo, M.







  



The barangay hall must facilitate programs that would gear the indigent senior citizens toward a uplifting their confidence and dignity. This can be done through constant recognition and recreational activities that would make the elders feel important and inspire them to continue to contribute to the community in their own ways.

The community of the senior citizens in barangay Tatalon must be united through a larger and stronger senior citizen organization of UNISCA, BATASCO and TASKA. All seniors must take initiative to participate and be open to changes in their activities even at their old age. The said organizations must make extra effort to widen their population and scope in order for government programs to be disseminated to more elders for their benefit.

The non-government organization of COSE must increase its resources enough to absorb barangay Tatalon within their scope of affiliations. The barangay would benefit a lot from the knowledge and compassion of COSE for indigent elders in terms of their capacity to cry out to the congress about problems of indigency. It is the right of Tatalon to be given this access and other livelihood programs of COSE as well.

The Congress must redefine their classification on who the indigent senior citizens are that will be qualified for the Social Pension Program and fix their application process The Congress must consider the pension universality or totally removing the discrimination of pension rates and let all Filipino senior citizens receive cash transfer.

Policy makers must see and acknowledge those elders who are not able to afford insurances or any sort of pension and are not eligible to be beneficiaries for indigent programs. They must see the overlooked elders who are left in the middle and incapacitated.

Raise awareness to senior citizens about their rights and privileges because apparently, some do not claim their ID and mandatory Philhealth card due to the lack of knowledge.

Antonio, A.M. Ph.D. (2015). Filipino Seninor Citizens Care Manage ment: Current Status of Local Government Unitâ&#x20AC;&#x2122;s Response. De La Salle University-Manila, Taft Carlos, C. R. Ph.D. (1999) Concerns of the Elderly in the Philippines.

(Unpublished thesis). University of the Philippines, Philippines.

Castro, L. (2015). Efforts of the Philippine Statistical System in Compili ng Statistics on Population Ageing. United Nation, New York City.

Department of Social Welfare and Development & Department of Health. (2007). Community Services for the Elderly in the Philip pines. Tokyo, Japan: Retrieved. http://www.mhlw.go.jp/bunya/ kokusaigyomu/asean/ asean/ koku sai/siryou/dl/ h19_philippines.pdf Mohyuddin, A.& Rehman, I. (2015). Economic Issues of Senior Citizens.

Quaid-i-Azam University, Islamabad Pakistan Leon, A. Ph.D. (2014). The Quality of Life of the Filipino Elderly in Se lected Cities and Provinces. Philippines.

Lu, A. (2009). Retirees and health insurance: A n analysis of their private, public and out of pocket usage after they migrate south. Du quesne University, Pittsburgh, Pennsylvania Racelis, R., Abrigo, M. R.,and Salas, J.M., (2012). Elderly Living Ar range ments, Work Activity, and Labor Income as Old-age Sup port. Discussion Paper Series (no. 2012-31), Makati, Phil ippines.

Sanchez, N. (2008). The Filipino Citizen at a Glance. (Unpublished the sis). Philippines.

Thakur, A. (2008, April 26). Care of Senior Citizens and Role of the State. Economic and Political Weekly, p. 11-12.

Welsch, H., and Kuhling, J., (2016) Macroeconomimc Performance and Institutional Change: Evidence from Subjective Well-being Data.

Journal of Applied Economics. Vol XIX, No. 2, Oldenburg, Ger many

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Effects of Government Programs to the Condition of the Indigent Senior Citizens in Barangay Tatalon

References

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail Mark Jason C. Aquino & Benjar A. Cataluna San Beda University

Abstract The objective of this study was to determine the effectiveness of Inmateâ&#x20AC;&#x2122;s Welfare and Development Program of the Rizal Provincial Jail to the preparedness of the inmates for re-orientation in society and their well-being.

The study used Education, Livelihood, Health, Religion, Sports, Condition of Inmates, Program Efficiency, Program Objectives, Program Strictness, Program Clarification as the independent variables while Self-Preparedness, Health & Well-Being, Social Well-Being, Violent Well-Being, and Environmental Well-Being as the dependent variables.

The major findings were that both Health program and Program Effectiveness has a significant effect to all the dependent variables. While the Livelihood program has no significant effect to any of the dependent variables The study concluded that all variables have a significant effect to selfpreparedness and well-being except for the livelihood program.

JEL Classification: D6, H3, H53,H75, I31, , I38, Keywords: Entitlements, Social Welfare Programs, Public Assis tance, Welfare Effects, Well-being

INTRODUCTION The state of being urbane in the Philippines is seen with the combined concept of size, density, and the existence of certain institutions associated with a lifestyle that is urban. People all over the country has their own way to live life. Different culture and perspective at the same time. According to (SanidadLeones, 2006), demographic studies reveal some common features of urban communities: (1) people of diverse cultures have different beliefs and behaviours; (2) differences among households with relationships between persons restricted to specific needs; (3) increased mobility, impersonality, and anonymi

43

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

ty; and (4) people who vary in age, race, ethnicity, norms, and values.

These are influencing factors that produce urban criminality. These are the factors that results urban criminality. In a place where it is highly populated and a poor community has a chance of high crime rates and it gets worse as time passes.

Robbery, kidnapping, assault and any illegal activity is a crime.

The main reason of crime is the lack of money for necessities in life.

No job or any source income triggers desperation that leads to illegal activities. To attain a job, a person must be educated making education a necessity.

There is also a relationship between age and crime. Typically, crime tends to peak during teenage years according to Farrington (1986). Based on research, severe crimes happen between the ages of 25-30. This shows how a younger average age can be related to crime rates. When these offenders are imprisoned, is it right to punish them or is it possible to engage them in rehabilitation programs and other means to change them in to a better well-being for them to be prepared for society.

The Filipino Inmates. Ther e ar e ar ound 98 million Filipinos currently among them 53 million of those people live in luzon according to the Philippine Statistics Authority as of January 2015. In 2012 the PSA reported around 217,812 crimes committed in the country which gradually increased in 2013 to 1,033,833 which is a percentage change of 374.64%. From 2013, it has increased to 1,161,188 which is a percentage change of 12.31%. Annual Poverty Indicators Survey (APIS) presented that the Philippines has about 3.8 million out of school youth or about 10 percent of the 39 million Filipinos with age range 6-24 years old. In the report, it stated that 87.3% of the youth population was 16 to 24 years old. In addition, the proportion of out of school children and youth was higher among females than males (Sun Star Manila, 2017).

Based on UN population projections, there will be around 25.09 million Filipinos aged 15-24 by the year 2055. In addition, Philippines dependency ratio â&#x20AC;&#x201C; those aged 0-14 and 65 above will continue to decline by the year 2050. So it is not exaggerated to say that the hope of the Philippine economy and the future of our country is in the hands of the youth.

The Rizal Provincial Jail and the Inmates Welfare and Development Program. custody of detainees with pending cases in the different courts in the Province of Rizal and for the Officers of Rizal provincial jail to assist in their rehabilitation and reformation especially regarding their self-preparedness and well-being.

Rizal Provincial Jail service has continued to offer inmates the Inmates Welfare and Development Program which consists of rehabilitation programs such as Livelihood Programs, Health Services, Religious Activities, Recreational and Sports Activities, and vocational education and training that would help them be reintegrated into the soci-

44

ety and actively participate in positive socio-economic engagements upon release.

Aquino, J. M. & Cataluna, B. A.

OBJECTIVES OF THE STUDY The main goal of this study is to determine the effects of the usefulness of the education training under the Inmates Welfare and Development Program of the Bureau of Jail Management and Penology in the Rizal Provincial Jail. The main goal of this research was to show the effects of inmates attaining an education degree. This research paper knew whether detainees having a degree is useful for the economy. In doing so, this study will explore the specific sub-themes under the Inmates Welfare and Development Programs such as livelihood projects, educational and vocational training, health services, sports, and religious/spiritual activities. Furthermore, this study will also try to establish the preparedness of the inmates for future re-orientation in society in terms of selfpreparedness, general health & well-being, social well-being, violent well -being, and environmental well-being. As such, the implications of this study can help in the crafting of possible policy recommendations on the Inmates Welfare and Development Program of the Bureau of Jail Management and Penology.

REVIEW OF RELATED LITERATURE Concept of Inmates Welfare and Development Program.

The bureau has four major areas of rehabilitation programs which are: Livelihood Projects, Educational and Vocational Training, Recreation and Sports, and Religious/Spiritual Activities. These programs will be under the IWDP or the Inmates Welfare and Development Program.

The researcher chose this study to know the significance and usefulness of Inmates Welfare and Development Program of Bureau of Jail Management and Penology specifically on the education and vocational training.

It will reform the personality of every inmate by joining the program to help them to improve public safety by making inmates more productive when they are released. One of the guiding principles of the program is that human rights of inmates shall be upheld always. So with this in mind the program should be able to treat inmates not as criminals rather those that are in need of attention and lesser humans so when the time comes that they are released they donâ&#x20AC;&#x2122;t feel outcasted from society and would still be able to coexist with anyone.

Stylistic Characteristics of Offenders.

Inmates Income Before and After Arrest. The study of (Brush, 2007) shows the effect that income inequality level has on crime. The researcher started with the assumption that the national income inequality level has a larger effect on crime that the income inequality within smaller regions.

45

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

According to a study by (Freudenberg DrPH., Daniels PhD., Crum MS., Perkins PhD., & Richie PhD., 2008), income of males who dropped out were more likely to get it from illegal activities prior to the index arrest than those who did not drop out. In the study of (Lochner, 2007), in the National Longitudinal Survey of Youth, 34% of all men age 20-23 with 11 or 12 years of completed schooling self-reported earning income from criminal activities Visher conducted yet another survey after eight (8) months after the former inmates being released. In the figure below, there is still a high percentage of former inmates relying on family and friends.

The median monthly income of former inmates two (2) months after release was $410. After eight (8) months of inmate release, the median monthly income has increased to $700.

In a similar survey by (Freudenberg DrPH., Daniels PhD., Crum MS., Perkins PhD., & Richie PhD., 2008), they had a comparison of Pre- and Post-release of former inmates in New York City. A year after release, men were less likely to earn money from illegal activities, public benefits, or to obtain money from family and friends. In the year after release, 65% of 491 respondents reported income from friends and family, followed by formal jobs (34%), and informal jobs (23%).

Skills and Competency Development. In a study by (Coulter & Korpi, 2000), the two researchers stated that the need of education as a rehabilitative measure is now obvious in all correctional institutions.

According to (Lochner & Moretti, 2004) study, the researchers used two other data sets which are state-level data on arrests from the Uniform Crime Reports, and self-report data on crime and incarnation from the National Longitudinal Survey of Youth. Even if education affects the relative opportunities available to inmates, his model suggests that the relationship of crime and education may be more complicated.

Criminal Behavior Needs. Every inmate committed a crime because he has many needs. The need principle makes a distinction between criminogenic and non-criminogenic needs. They need that inmateâ&#x20AC;&#x2122;s needs are functionally related to criminal behavior or criminogenic needs and others have a minor or no relationship to criminal behavior needs (i.e. For higher risk inmates, they will have more criminogenic needs, requiring not only more services from rehabilitation programs, but also a greater extent of services (Andrews & Bonta, 2010).

Table 1 presents some major criminogenic and non-criminogenic needs

Aquino, J. M. & Cataluna, B. A.

46

Table 1. Criminogenic and Non-Criminogenic Need Criminogic

Noncriminogic

Procriminal attitude (thoughts, values and sentiments supportive of criminal behavior)

Self-esteem

Antisocial personality (low self-control, hostility, adventurous pleasure seeking, disregard for others, callousness)

Vague feelings of emotional discomfort (anxiety, feeling blue and feelings of alienation)

Procriminal associates

Major mental disorder (schizophrenia, depression)

Social achievement (education, employment)

Lack of ambition

Family/marital (marital instability, poor parenting skills, criminality)

History of victimization

Substance abuse

Fear of official punishment

Leisure/recreation (lack of prosocial pursuits)

Lack of physical activity

Source. (Andrews & Bonta, 2010)

In a study by (Machin, Marie, & Vujic, 2011), they discuss that education and crime have a causal connection. These researchers used data from Offenders Index Database (England and Wales), Census, and the British Crime Survey. The researchers suggest that policies that prioritizing schooling and human capital investment have significant potential to reduce crime in the longer run by increasing skill levels.

Crime to Education attainment. The study of (Machin, Marie , & Vujic, 2012) discovered how education reduces the crime rate. They started their study by hypothesizing that education has a negative effect on crime rates. Results from this study are consistent with the hypothesis that higher education levels can have a substantial impact on the crime rate.

Impact of Formal Education Programs in Prison on the wellbeing of Inmates. Despite limited funding and fr equent lack of public support, prison officials have made efforts to establish prison programming that helps inmates successfully reenter society after release from prison. Therefore, the quality of supervision (that is, training and treatment) the prisoners get in the prisons (and after release from prisons) would determine the success of the prisoners in life after incarceration (Harper Grunt & Careen Chitty, 2004) The use of education and training in prison programs become pervasive in the 1930s since then, it has fluctuated with societyâ&#x20AC;&#x2122;s alternating emphasis on rehabilitation and punish-

Impact of Livelihood Programs in Prison on the well-being of Inmates.While serving their sentences, the long sentence prisoners are supposed to be trained in various industrial trades 15 such as carpentry and joinery, wood processing, leather work, taxidermy, soap manufacturing, mechanics, Blacksmith, upholstery, sign writing and other industries which are expected to be widely marketable. These inmates also sit for various trade tests in prison so that they can easily secure employment after release. Prison authorities argue that inmates are given a chance to select the type of training they would like to settle on while in prison. Prisoners sentenced for less serious offenses are held in short-term medium security prisons and are expected to train in agriculture, livestock rearing and simple industry involving carpentry, simple repairs and tailoring. This is because apart from learning to feed themselves from the farm produce while in prison, it is expected that by the time of their release, prisoners will have learned some techniques in commercial and subsistence farming which they would practice on release, taking into consideration that Kenya is mainly an agricultural country. The actual operation of the prisons was being inspected to determine whether prison conditions had worsened the problems of crime in Kenya. When released, prisoners work on the outside world. Unfortunately, the ex-prisoners find that the equipment and techniques used in prison are obsolete and that few acquired skills were transferable in the world of sophisticated technology. In the prisons, there are no qualified personnel to train prisoners in the needed skills which would enable ex-prisoners to compete effectively in today’s highly competitive job market. Most prisons involve at least some prisoners in work activities necessary to operate and maintain the institution; But because of the nature and structure of this work, it has few benefits to prisoners beyond keeping some busy (Deigh John, 2009) Impact of the Social Welfare Services in the Prison such as Religious, Sports, and Health on the Well-Being of Inmates.

According to (Muasya, 2013), Kenya’s prisoners are entitled to receive social welfare services from correctional officers. The tool employs the technique of group counselling which would involve the use of non-

47

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

ment. A study carried out in Mozambique prison found that, prison inmates felt that there was dire lack of educational and recreational facilities in prisons (Wees Greg 2005). In 1965, the Tanzania Annual Prison Report stated that: “This service, as mentioned in previous reports, is in process of evolving policy which would make the prison administration service not only for a punitive but essentially a reformative one, capable of converting prisoners into good citizens after release from custody” (Mushanga, 1976).

Aquino, J. M. & Cataluna, B. A.

48

medical staff to run discussion groups with prisoners along certain agreed lines. In this approach, a member of the prison staff acts as counsellor and prisoners are encouraged to face up to their personal problems by interaction and self-criticism in the group setting. Prisoners leave prisons with problems of social maladjustment. Although the goal of training and treatment in prisons is to maximize the opportunities for new and helpful experiences for prisoners and to increase the challenge to fixed and settled behavior patterns, many ex-prisoners seem to fare worse after confinement rather than coping better with the obligations and responsibilities of being a law-abiding citizen.

METHODOLOGY Before conducting the study, coordination with the officials of the Rizal Provincial Jail specifically on the officials in charge of the Inmates Welfare & Development Program is needed. Information regarding their programs and the respondents, which are the convicts, needs proper clearance. Hence the study first complied with the proper procedures in obtaining such information. Primary data was utilized though the use of questionnaires to record the information regarding the inmates and their experience with the program, specifically their demographic profile, economic status, and educational attainment. Furthermore, the questionnaire can help determine and explain the program affects their selfpreparedness for re-orientation in society and well-being of the inmates.

The study used Cross-sectional data to find out the relationship of each independent variables. Furthermore, in providing answers to the research problems, and providing analysis on the relationship of variables, Descriptive Analysis was also used together with the required statistical tests and interpretation.

Econometric Model. The study made use of statistical tr eatments such as economic regressions in analysing and interpreting the results of the data/information gathered. Variables to be used for regression were treated according to their level of measurements, either ordinal or nominal. Basic statistical treatments such as Mean and Frequencies were also used in the study. In presenting the results, the researcher made use of software programs such as MS Excel, Gretl and IBM SPSS.

Equation 1. R egression Equation \Where: = Constant term or intercept = Partial Regression coefficient; each regression coefficient represents the amount of deviation of the group identified in the dummy variable from the mean of the reference category.

Dependent variables SP = Self-Preparedness HB = Health Well-Being SB = Social Well-Being VB = Violent Well-Being EB = Environmental Well-Being

Independent variables EDU = Education LVH = Livelihood COI = Condition of the Inmates HTH = Health REL = Religion SPR = Sports PRE = Program Efficiency PRO = Program Objectives PRS = Program Strictness PRC = Program Clarification

DISCUSSION OF RESULTS Summary of Findings. Out of the 98 beneficiar ies of the Inmates Welfare and Development Program of the Rizal Provincial Jail, the researcher gathered primary data from 60 respondents. Majority of them are 36 to 40 years old. It is also recorded that 33 out of the 60 respondents are single while 21 are married. Most of the respondents or 26 out of 60 only finished high school, 15 graduated college, 11 graduated elementary, six (6) graduated in TESDA, and two (2) respondents didnâ&#x20AC;&#x2122;t attain any kind of education. Ten respondents are living with other people, 34 have their own home, and 14 are renting. Majority of the respondents or 36 out of 60 are under Class E or those who are earning Php8,000 or below. While 23.3 percent of the total respondents are under Class D or those who are earning Php8,001 to Php15,000.

Five of the respondents are under Broad C or Php15,001 to Php30,000.

Two of them are under Upper C and one for Class A and Class B while the last one has no income.

As for the condition of the inmates, respondents imprisoned five (5) years and below has a mean response of 4.02 or agree while those imprisoned more than ten years have a mean response of 4.38 or strongly agree. Those respondents who spent time longer in prison have a higher perception when it comes to their condition inside the facility than those who spent less time in the prison. Furthermore, the

49

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

Where:

Random error term which contains the myriad other factors that can influence the socio-economic and social con ditions the households but not taken into account in the model.

Aquino, J. M. & Cataluna, B. A.

50

grand total has a mean response of 4.22 of strongly agree which just proves that the respondents have a positive perception on their condition inside the facility.

For the self-preparedness of the inmates, respondents imprisoned for more than ten years are more prepared than the other inmates because they have a higher weighted mean response of 4.43 or strongly agree. Inmates who were imprisoned for five (5) years and below are less prepared than other because they have a lesser weighted mean response of 3.92 or agree. As discussed in the previous chapter, the longer the length in prison, the higher the chance they are prepared. As seen in the results, it can be proven that inmates who spent more than ten years in prison are better prepared than others.

For the health and well-being of the respondents, inmates imprisoned for more than 10 years have a higher perception on the health and well-being of the inmates with a weighted mean response of 4.26 or strongly agree while those imprisoned for only five (5) years and below has a weighted mean response of 3.94 or agree which is lower than the others. The age of the inmates who have a longer stay in the facility are much older than the others therefore they receive more medication because they have a higher risk to diseases which results to them having a higher weighted mean.

In terms of social well-being of the respondents, the inmates who spent more than ten years in the prison have a weighted mean response of 4.69 or strongly agree while those who spent five (5) years and below has a mean response of 4.44 or strongly agree. This implies that the longer stay in the facility, the higher chance of having more friends in the facility than those who were just convicted. Furthermore, the mean response of the grand total falls into the category of strongly agree which can be concluded that the social status of the inmates inside the facility is positively high.

When it comes to the violent well-being of the respondents, the respondents who spent five years (5) and below inside the prison have a weighted mean response of 2.00 or disagree while those who spent ten years or more has a weighted mean response of 1.35 or strongly agree.

This implies that those who were just convicted have higher thoughts of hurting themselves than others. This doesnâ&#x20AC;&#x2122;t mean that having higher thoughts means that they will hurt others.

Furthermore, the mean response of the grand total is 1.50 or strongly disagree which can suggest that the respondents strongly disagree on hurting anyone.

In terms of the environmental well-being of the respondents, inmates who were imprisoned for five (5) years and below has a higher weighted mean response of 3.15 or fair while those who spent ten years or more in the prison with a weighted mean response of 3.00 or fair. Even though that they responded fairly, respondents convicted five (5) years

51

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

and below has a higher weighted mean which can imply that see the facility as a safe environment more than the others.

For the livelihood programs achieved by the respondents, those inmates who were imprisoned for five (5) years and below has a weighted mean response of 3.65 or agree while those who were imprisoned for six to ten years have a weighted mean response of 2.99 or fair.

This implies that they think of the livelihood programs fairly and do not have that much of an impact to themselves.

As for the educational programs attained by the respondents, inmates who were imprisoned for more than ten years have a higher weighted mean of 4.15 or agree while those who were convicted five (5) years and below has a weighted mean of 3.70 or agree. This proves that education is more important for those who were longer in the prison than those who were just convicted. Realizing that education is important while staying longer in prison may be implied.

As for the religion programs, inmates who were imprisoned for more than ten years has a weighted mean that falls into the scale of strongly agree. Even though others also fall into the scale of strongly agree, those respondents who were imprisoned for ten years or more have a higher weighted mean which can be concluded that those respondents realize that religion can change and improve their wellbeing.

As for the sports program, all the respondents responded with a weighted mean response of 4.50 or strongly agree. This implies that it has a positive impact on the well-being of the inmates.

The study indicated ten indicators for the effectiveness of the Inmates Welfare and Development Program namely Education, Livelihood, Health, Religion, Sports, Condition of Inmates, Program Effectiveness, Program Objectives, Program Strictness, and Program Clarification.

Table 2. Composite Mean and verbal Interpretation of the Independent Variables

Program

Sports

Religion

Health

Condition of Inmates

Livelihood

Education

4.00 (A)

4.29 (SA)

3.93 (A)

4.29 (SA)

4.36 (SA)

4.12 (A)

4.02 (A)

3.07 (F)

3.70 (A)

5 years and below

4.49 (SA)

4.04 (SA)

4.49 (SA)

4.24 (SA)

4.62 (SA)

4.50 (SA)

4.27 (SA)

4.11 (A)

2.93 (F)

4.00 (A)

6 to 10 years

4.30 (SA)

4.59 (SA)

4.00 (A)

4.59 (SA)

4.43 (SA)

4.45 (SA)

4.88 (SA)

4.56 (SA)

4.38 (SA)

2.98 (F)

4.15 (A)

More than 10 years

4.51 (SA)

4.02 (A)

4.51 (SA)

4.29 (SA)

4.50 (SA)

4.65 (SA)

4.38 (SA)

4.22 (SA)

2.97 (F)

4.04 (A)

Grand total

COMPOSITE MEAN and Verbal Interpretation

Program Objectives

4.29 (SA )

4.17 (A)

STATEMENT

Program Objectives

4.01 (A)

Program Strictness

COMPOSITE MEAN

Aquino, J. M. & Cataluna, B. A.

Source: Survey administered by the Researcher Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Fair (F); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

52

3.10

(F)

(A)

(F)

(F)

3.49

3.01

(SD)

(D)

3.15

1.52

(SA)

(SA)

2.00

4.53

(SA)

(A)

4.44

4.23

(A)

(A)

3.94

4.19

6 to 10 years

3.92

5 years and below

(A)

3.55

(F)

3.00

(SD)

1.35

(SA)

4.69

(SA)

4.26

(SA)

4.43

More than 10 years

COMPOSITE MEAN and Verbal Interpretation

(F)

3.03

(SD)

1.50

(SA)

4.59

(A)

4.17

(SA)

4.27

Grand total

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

Source: Survey administered by the Researcher Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Fair (F); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

COMPOSITE MEAN

Environmental Well-Being

Violent Well-Being

Social Well-Being

Health and Well-being

Self-Preparedness

STATEMENTS

Table 3. Composite Mean and verbal Interpretation of the Dependent Variables

53

Health Religion Sports Program Efficiency Program Objectives Program Strictness Program Clarification

Constant Education Livelihood Condition of the Inmates

0.647

0.049 -0.021 -0.021 0.547 -0.031 0.080 0.066

-0.015 0.217 -0.055 0.224

Model 1 Self-Preparedness

0.000

0.557

0.419 -0.231 0.035 0.265 0.072 0.049 -0.016

0.437 0.036 0.157 0.124

Model 2 Health Well-Being

0.003

0.183

0.156 0.241 0.399 -0.288 0.210 0.034 -0.065

1.896 -0.115 0.114 -0.242

Model 3 Social Well-Being

0.010

0.148

-0.267 0.324 0.104 0.211 -0.163 0.043 0.103

2.228 0.053 -0.158 -0.404

Model 4 Violent Well-Being

0.000

0.311

0.125 -0.190 0.033 -0.040 -0.041 -0.129 -0.070

2.529 0.398 0.118 0.314

Model 5 Environmental Well -Being

Table 4. Results from Regression Analysis

Adjusted R-squared

0.000

Estimation of Parameters

P-value(F)

Aquino, J. M. & Cataluna, B. A.

Source: Survey administered by the Researcher

54

After conducting all necessary presentations, interpretations, analysis and statistical tests, the study concluded the following: Respondent’s Profile. The r espondents of this r esear ch were classified by their length of imprisonment. Most of the respondents are composed by More than 10 years with a number of 27. Followed by 6 to 10 years with 26 respondents. And lastly, five (5) years and below with seven (7) respondents. The researcher concluded that livelihood program is the most inefficient program in the IWDP. While Religion is the highest participated program of IWDP and it has a high positive impact on the well-being of the inmates.

Effects of the Inmates Welfare and Development Program to the Inmates of Rizal Provincial Jail. The study concluded that only Program Effectiveness has a significant effect on the Self Preparedness Model. However, at 90 percent confidence level, Education and Condition of Inmates are significant to Self-Preparedness. The other variables are said to be insignificant, and so the coefficient might as well be zero (meaning it could be excluded from the Regression and it’s not an important predictor or doesn’t explain the dependent variable very well). Furthermore, the study found out that Livelihood and Health has a significant effect on the Health and Well-Being of the Inmates. However, at 90 percent confidence level, Program Effectiveness is significant. The other variables are said to be insignificant.

Moreover, the Sports component is the only variable that is significant to Social Well-being of the inmates. Meanwhile, the Condition of Inmates component is the only significant variable to the violent wellbeing of inmates which is obvious because the condition inside the facility may affect the mental thinking of the inmates. Lastly, the Education, Livelihood, and Condition of Inmates components have a significant effect on the Environmental Well-Being on the Inmates. Theoretically, condition of inmates should really be significant because this may impact the environment of the inmates. The other variables are insignificant, and so the coefficient might as well be zero.

Summary of Conclusions. To summar ize this study, the Inmates Welfare and Development Program in the Rizal Provincial Jail do not significantly impact the self-preparedness for re-orientation in society of the inmates. As for the Health & Well Being of Inmates model, only the Livelihood and Health component of the Inmates Welfare and Development Program have a significant effect. Meanwhile in the Social Well-Being of Inmates model, only the Sports component is significant to the model. The same goes with the Condition of Inmates component of the Inmates Welfare and Development Program in which it has a significant effect on the Violent Well-Being of Inmates.

Lastly, the Education, Condition of Inmates, and Health components of the Inmates Welfare and Development Program have a significant

55

The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

CONCLUSIONS

56

effect on the Environmental Well-Being of Inmates.

Aquino, J. M. & Cataluna, B. A.

POLICY RECCOMENDATIONS The findings of this study helped in the construction of possible policy recommendations. Furthermore, this study also took into consideration that the policy recommendations should be practical and achievable by individuals and/or government agencies. Time and financial aspect are also considered.  Based on the results on the livelihood program, the facility should put more seriousness in implementing the program for the inmates to learn more about livelihood skills. The facility should also explore other livelihood skills that the inmates have no access to so that they can achieve other skills to improve their self-preparedness and well-being.  The inmates are highly participative in the religion program.

The researcher believes that the programs should be participated equally to improve the well-being of the inmates. Improving the strictness of the facilitators to let the inmates engage in other IWD programs other than religion will help improve the self-preparedness and well-being of the inmates.  Give more time to Health Services since the inmates lack certain services. Also balance the time distributed per program.

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Eckstein , Z., & Wolpin , K. I. (1999). Why youths drop out of high school: The impact of preferences, opportunities, and abilities. Econometri ca, 67 (6), 1-6.

Erlich, I. (2001). On the relation between education and crime. Education, Income, and Human Behavior, 313-338.

Farrington, D. (1986). Age and crime. Crime and Justice, 7, 189-250.

Fella, G., & Gallipoli, G. (2008). Education and crime over the life cycle.

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The Effectiveness of Inmates Welfare and Development Program to the Preparedness for Re-Orientation in Society and Well-Being of Inmates of the Rizal Provincial Jail

Freeman , R. (1991). Crime and employment of disadvantaged youth.

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Freeman, R. (1996). Why do so many young american men commit crimes and what might we do about it? Journal of Eco nomic Perspectives, 10, 25-42.

Freudenberg DrPH., N., Daniels PhD., J., Crum MS., M., Perkins PhD., T., & Richie PhD., B. (2008). Coming home from jail: The social and health consquences of community reentry for women, male ado lescents, and their families and communities. Am J Public Health. , 191- 202.

Groot, W., & Maassen van den Brink, H. (2007). The effects of education on crime. A pplied Economics , 2-20.

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Lochner, L., & Moretti, E. (2004). The effect of education on crime: Evi dence from prison inmates, arrests, and self-reports. A merican Economic Review, 94(1), 155-189.

Machin, S., Marie , O., & Vujic, S. (2012). Youth crime and education expansion. Discussion Paper Series No. 6582.

Machin, S., Marie, O., & Vujic, S. (2011). The crime reducing effect of education. The Economic Journal, 463-484.

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Rathie, M., Ahuja, A., & Sipos, I. (2009). Crime index vs. average years of education. 1.

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The Impact of Agrarian Reform Community Connectivity and Economic Support Services (ARCCESS) to the Agrarian Reform Beneficiaries (ARBs) of Coconut Farms: A Case in Maria Rosario Isidro Lalig (MARILA) Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

Zarah Abigail Detaunan & Rulina B. Viloria San Beda University

Abstract

Agrarian Reform Community Connectivity and Economic Support Services (ARCCESS) is a support service that Department of Agrarian Reform created with an objective of improving productivity of the ARBs through the provision of agri-extension services and usage of agri-technology.

The objective of this study is determine the impact of ARCCESS to the ARBs of Coconut Farms in the MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna. The study used the following independent variables: accessibility and utilization, quality of services, satisfaction, and effectiveness of implementation and organization of the process.

ARBs of MARILA MPC was represented by their economic condition, farming practices, farming productivity and threats and challenges preparedness.

The findings of the study were: (1) ARCCESS has a significant impact to the farmerâ&#x20AC;&#x2122;s economic condition, ARBs farming practices, ARBs farming productivity, and ARBs threats and challenges preparedness. The researcher concluded that the accomplishment status of ARCCESS have significant impact to the ARBs economic condition and economic performance of coconut farming production.

JEL Classification: C5, Q12, Q13, Q14, Q15, Q16, Q18 Keywords: land reform, agriculture support services, Agrarian Reform Beneficiaries (ARBs) economic condition, farming production

INTRODUCTION Land is one of the most essential natural resources of a country that is fundamental to the economy. Land can also be used as a display of wealth and power. Most importantly, land is the most valuable resource needed for food production.

Land tenure system reflects on the current economic and social status of a country. When there are conflicts in the system, land reform is usually imposed to reorganize the institutional framework and resolve its issues and progress overtime.

In its purest form, land reform always meant to correct the redistribu-

CARP is one of the longest running executed program in the country. Counting from its implementation in 1988 to its extension in 2009 and up to present, it has been twenty nine years since its imple-

59

The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

tion to the landless to alleviate poverty among them. It also aims to release the tenants of lands from contracts of their respective land lords.

Land reform envisioned a change in the traditional land tenure system which only include distribution of power and property to family members only, not including the tillers that work hard for the prosperity of the land.

Upon the implementation of land redistribution, series of obstacles have been encountered, it may distribute the lands to the landless farmers but this does not guarantee any efficient improvement in the growth of their output and productivity. Thus many agricultural countries concluded that there is a need to support the farmer beneficiaries in cultivating their lands efficiently. This is the time when land reform evolved to agrarian reform.

The government came up with a revised social movement that envisioned a new direction in the land tenure system. The new kind of redistribution is called agrarian reform (Zarin and Bujang, 1994).

Agrarian reform is an improvement in agrarian system through the transfer of lands and support services offered to the farmers. It measures modernize agricultural practices and the living condition of the beneficiaries of land. It includes the creation of government agencies that will be in charge of certain programs that will provide an improvement in the socio-economic conditions of the farmer beneficiaries (Borras, 2008).

Comprehensive Agrarian Reform Program (CARP). The Comprehensive Agrarian Reform Program (CARP) known as the Republic Act 6657 was implemented in June 10, 1988 under the administration of former late President Corazon C. Aquino. This reform program aims to establish a social justice to the welfare of landless farmers and farm workers through an equitable land distribution by providing support services to increase their efficiency in productivity. The main purpose of CARP is to implement a sustainable rural development in the country through the just distribution of land and provision of developmental services that will provide a development on the wellbeing of the farmer beneficiaries (Department of Agrarian Reform, 2013).

CARP is a social reform that aims to promote poverty eradication and rural development that focuses on the improvement of rural areas where the farmers are situated. Its early implementation covers only the plantations of rice and corn because those are the only recognized agricultural products. On January 1991, the coconut industry is accounted for the program because of its rising demand as an agricultural product and covers one-third of the total private agricultural land (Freneo and Serrano, 1991).

Detaunan, Z.A. & Viloria, R.B.

60

mentation. It has been widely seen as a training ground for the all the administrations. The Comprehensive Agrarian Reform Program Extension with Reforms (CARPER) or the Republic Act 9700, signed on August 7, 2009, gave an extension to CARP for an additional five years to be completed. In 1998, CARPâ&#x20AC;&#x2122;s land acquisition and distribution component had been given its first 10-year extension and an additional funding of PhP 50 billion through Republic Act 8532 (Manahan, 2013).

Almost thirty years after the implementation, CARPâ&#x20AC;&#x2122;s accomplishments remain constant. Through the years, the government has taken to specific actions on CARP but still it remains unfinished (Manahan, 2013). Looking beyond, the present achievement is far from what had been predicted. But as the agrarian reform continue towards full and meaningful implementation certain conflicts emerged.

The CARPER ended on 2014 during the term of former president Noynoy Aquino. Throughout his term, there are no existing extension bills that has been passed for CARP. Land distribution continues without any extensions, at the end of his term, 621,000 hectares have been distributed to the beneficiaries. In 2016, the total land coverage of DAR is 4 million hectares (DAR, 2017).

At the present administration, President Duterte promises to distribute 472,000 hectares at the end of 2019. He also ensures that the remaining 15% of lands will finish distributing at the end of his term in 2022 (DAR, 2017).

Table 1. CARP's Performance per Administration Share of Land Distribution

CARP Accomplishment (in hectares)

Share of Land Distribution Output (in percent)

Corazon Aquino

848,518

Fidel Ramos

Years of Presidency

Annual Land Distribution (in hectares)

18.66

6

141,419.7

1,900,035

41.78

6

316,672.5

Joseph Estrada

222,907

4.90

2.5

89,162.8

Gloria MacapagalArroyo

954,408

21.00

8*

119,301

Benigno Aquino III

621,342

13.66

6

103,557

TOTAL

4,547,210

100

25.5

770,113

Source: DAR Accomplishment Reports, 1988-2014 *Gloria Macapagal-Arroyo distributed lands from 2001-2008. During the last two years of her presidency, land distribution was halted due to the uncertainty of the future of CARP

The issues of agrarian reform, pro-poor and sustainable rural development and poverty alleviation are considered as inextricably interlinked elements of both national and international policies and development agendas. Keeping in view the exploitation of linkage potentials between growth in agriculture and that in the non-agricultural sector, a sus-

61

The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

tained and broad- based rural development strategy must also give priority to promotion of non-farm employment activities and development of small and medium enterprises (Khundker, 2007).

The most important arguments favoring broad-based agrarian reforms include conflict prevention and resolution, productive efficiency, economic growth, job creation, poverty reduction, equity and social justice. These are macro level impacts following from successfully implemented reform measures which lead to overall high national economic growth, but do not originate directly from agrarian reforms per se. A truly redistributive reform carried under a conducive policy environment (i.e. favorable macro and sectoral polices including in particular, agriculture and trade) creates cumulative impacts via a chain of positive changes which link agrarian reform with economic performance (Khundker, 2007).

Agrarian Reform Community Connectivity and Economic Support Services (ARCCESS). Under the administration of former DAR Secretary Ernesto Garilao a strategic plan was launched in 1993 on the concentration of the available funds into support services to the ARCs. Under the supervision of former DAR Secretary Delos Reyes, the introduction of Agrarian Reform Community Connectivity and Economic Support Services (ARCCESS) was launched to build an organization or cooperative of ARBs for them to have an access on inputs, credit and marketing support. ARCCESS supports farmers by organizing them into productive partners for rural development. Consolidating the production, processing and marketing efforts of ARBs to achieve bargaining power, enter into equitable marketing agreements, and overcome the barriers presupposed by the economies of scale (DAR, 2013).

The ARCCESS program responds to the Philippine Development Plan (PDP 2011-2016) which appreciates the Comprehensive Agrarian Reform Program not just as a means to achieve social justice but as a strategy to attain Competitive and Sustainable Agriculture and Fisheries. The PDP notes that one of the keys to development rests in turning ARBs into entrepreneurs.

The PDP includes six strategies to attain agricultural development. This includes, raising the productivity and incomes of agriculture and fishery-based households and enterprises; increasing investments and employment across efficient value chains; increasing the resilience of agriculture communities through the development of climateresilient agricultural infrastructure and climate-responsive food production systems, and provision of support services to the most vulnerable communities; strengthening the agriculture and fisheries insurance system as an important risk-sharing mechanism; reaffirming the mechanisms and objectives of the National Convergence Initiative (NCI); and pursuing public-private partnerships, especially for infrastructure and value-chain development (DAR, 2013).

Detaunan, Z.A. & Viloria, R.B.

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The ARCCESS is comprised of five components. First, the marketing assistance with the help of deployment of professional services to ARBOs to assist them in implementing their agri- based enterprise; these professional services include agri-extension and business development in the organization and financial aspects. Second, the provision of common service facilities (CSF) or farm equipment to Agrarian Reform Beneficiaries Organizations (ARBOs) which they will use as their business asset. Third, strengthening access to credit and insurance facilities in partnership with the Land Bank of the Philippines (LBP), Department of Agriculture-Philippine Crop Insurance Commission (DA-PCIC) and private financing institutions. Fourth, the rural infrastructure provision of strategic farm to market roads (FMR) that will connect the markets to the ARBO location. Lastly, the land tenure improvement assistance to ARBOs with pending â&#x20AC;&#x153;second generation casesâ&#x20AC;? (i.e., subdivision of collective CLOA, inclusion-exclusion of farmer beneficiaries, ejectment cases, and land inheritance) (DAR, 2013).

OBJECTIVE OF THE STUDY The main objective of this study is to determine the impacts of the accomplishment status of the Agrarian Reform Community Connectivity ad Economic Support Service (ARCCESS) program to the Agrarian Reform Beneficiaries (ARBs) of coconut farm in Marila Multi-Purpose Cooperative (MPC) in Barangay Santisimo Rosario in San Pablo, Laguna.

Specifically this study aims to establish the significant impacts of the ARCCESS program to economic conditions of the farmers, their productivity, farming practices and their readiness towards threats and challenges. To this end, the study also aims to identify the accomplishment status of ARCCESS program in terms of its accessibility and utilization, quality of service, satisfaction, effective implementation, and the organization process involved on the program.

Lastly, the results of this study also known as the policy implications can help decision makers in providing solutions to problems such as the improvement of the program beneficiaries, farming practices, farming productivity and mitigation.

REVIEW OF RELATED LITERATURE Characteristics of Agrarian Reform Beneficiaries.

Income. According to the study of Moyo (2011), while before 2000 agricultural production was predominantly export oriented, the incomes realized were concentrated among a few large farmers, alongside domestic and foreign capital. Peasants cropped much more land and used more labor towards producing various foods largely for autoconsumption. The latter trajectory has been consolidated, but land and labor productivity continue to be low. Consequently, domestic food production has on average been 35 percent short of requirements, with

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The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

wheat, soya beans and dairy fairing worst, while the output of pulses has expanded. Zimbabwe continues to have some relatively more secure food enclaves, reflecting uneven production and productivity patterns. Small producers in the southern districts continue to face regular grain deficits, while those in the wetter regions increased their production of pulses and cash crops, particularly tobacco and various vegetables (Moyo, 2011).

Land Ownership. According to the findings of Agrawala and Agarwal (2017), land ownership matters a great deal, but the relationship with liking/disliking farming is not linear. Farmers are found to be more likely to dislike farming if they own little land, but after a certain point satisfaction tapers off. Those dissatisfied with farming also tend to have less access to inputs, especially irrigation. As hypothesized, farmers with irrigation in any form are more likely to like farming than those without: the marginal effects of both seasonal and source dummies are positive and significant in all four models.

Productivity. According to Attfield (2014), this argument is based on the assumption that large-scale, mechanized farming in South Africa is generally efficient, and that land reform will only lead to small-scale family or subsistence-type farms that cannot compete with large scale commercial farming in terms of productive capacity and the provision of viable livelihoods. While it is true that land reform often entails the establishment of small-scale farming activities, it is not true that this necessarily implies loss of productivity and prosperity. On the contrary, by creating more opportunities for employment, laborintensive small-scale farming can often contribute more to productivity and prosperity than large-scale farms, where mechanization tends to reduce employment. It also cannot be maintained, at least not in South Africa, that there is a direct correlation between farm size and productivity or prosperity. Furthermore, while productivity and a reasonable level of prosperity may be necessary for sustainable development, they are not sufficient. In particular, they guarantee neither social nor ecological sustainability. (Attfield, 2014).

Adaptive on Threats and Challenges. According to McCarthy (2007), considering the threat that farmers face of declining income from nut loss in terms of numbers harvested and quality, coconut farmers in Tanzania have sought various alternatives to minimize the risk from coconut production. Farmers have responded to cope with the prevailing problem through crop diversification, where they intercrop coconut with cassava, citrus, cashew nut, maize, sorghum, potato and pineapples. Similar observations have been reported by different researchers in other parts of the world. For example, in Western Samoa, coconut alone based on returns per man-day failed to meet the cash return needs of the extended family. The only alternatives were to practice intercropping and to ensure that the majority of family labor had off-farm employment. For a family owning a 3-ha coconut holding, total net revenue was maximized when coconut was intercropped with

Detaunan, Z.A. & Viloria, R.B.

64

cocoa, pineapple and vegetables. It is commonly believed that crop diversification among smallholder farmers is compatible with maintaining or improving household income and food security when cash crops are included in the crop mix (McCarthy, 2007).

Institutional Efficiency Accessibility. According to the study of Lund (2011), it was concluded from our study that land reform schemes in the Brazilian northeast have not been attached to areas that are sufficient to create surpluses and thereby to enable settlers to improve their standard of life. Despite the availability of rural credit, little attention has been devoted to the provision of large-scale infrastructure serving the settlements. Consequently, as confirmed by the settlers we interviewed, just possessing a piece of land is not enough to improve quality of life. Likewise, the strong significance of investments for farming GDP growth in our analysis suggests that special attention must be paid to this aspect of the reform, since productive investments are also a positive factor in meeting the basic human needs of the beneficiary population.

Moreover, the accessibility of public services was a vital factor in efforts to improve the settled families’ quality of life, given that living conditions on the sites were precarious. The poor quality of infrastructure in settlements across the region and the lack of public utilities (roads, communication, water supply, sanitation, waste disposal, health, education, and the like) serving the target areas indicate the massive investments that will be required (Lund, 2011).

Quality and Satisfaction. According to Banaji (2009) conclude that Karl Kautsky discovered the mechanism underlying agricultural transformation, based upon the experience of Western Europe. He provides a detailed analysis of process of agrarian change and concludes the laws of agricultural development under capitalism in agriculture. According to him, developed capitalism in industry affects agriculture and means of communication reduces the distance in rural areas to towns, rent farm changed into cash payments instead of barter. The increased role of money and dependence of peasant on markets increase and creates middleman then comes usurer and merchant capital and land becomes private commodity including change in mode of production. He further explains a long process of agriculture development when he says that the use of machinery, tools and equipment put agriculture on new basis in 19th century. New cropping patterns and individual ownership of land and commodity production introduce capitalism in agriculture and capital accumulation process begins. Introduction of capital creates two kinds of farmers, large scale farmers engaged in production for markets and small farmers are technologically backward and use family labour engaged in production for home consumption, he also pays attention to the coexistence and mutual relations between big and small farmers (Banaji, 2009).

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The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

Effectiveness and Organization of Process. According to Souza and Silva (2011), it was concluded from our study that land reform schemes in the Brazilian north-east have not been attached to areas that are sufficient to create surpluses and thereby to enable settlers to improve their standard of life. Despite the availability of rural credit, little attention has been devoted to the provision of large-scale infrastructure serving the settlements. Consequently, as confirmed by the settlers we interviewed, just possessing a piece of land is not enough to improve quality of life. (Souza and Silva, 2011).

Neoclassical Land Reform.

The Neoclassical Land Reform relates to the study of the accomplishment status of ARCCESS program where in land tenure system should facilitates wealth maximization through the help of government and the market to implicate a favorable rural development in agriculture which in turn will facilitate socio-economic development for the farmers. This tallies with the neo-classical view that there is a direct relationship between land reform, agrarian support services and economic development. In such circumstances, the reformed tenure system becomes a major force in maximizing accreationary formation of capital in agriculture and in ensuing that surpluses above sustenance levels will be reinvested in productive economic activity.

At the same time, land reform is an essential move for providing a stable base for a country's future economic development, but successful land reform do not guarantee fast and successful development.

This is because land tenure is only one component of an agrarian system and the dimensions and future security of farming 'opportunities are affected by labor, capital and product markets too.

Therefore land reform must be accompanied by changes in the pre-reform structure of supporting services that are agriculture credit, marketing, research and extension, input supplies, processing and storage. Nevertheless, the absence of an efficient land tenure system hinders the speed of commercialization and the elimination of subsistence economics which offer no incentives to raise productivity.

New Institutional Economics.

Institutional Economics is an analysis based mostly on formal institutions and the role of society in defining values, while the approach of the New Institutional Economics is more individualistic point of departure is the individual itself. Institutions in this theory are originated from individual behavior, through interaction among individuals.

According to North, they are “the humanly devised constraints that shape human action”. Institutions are constrained by the informal conditions like culture and custom, as well as formal conditions: law, property rights. Institutions are the rules of the game in the economy, and organizations the players of the game.

According to Institutional Economics, habits, norms and institutions play a significant role in directing human behavior without re-

Detaunan, Z.A. & Viloria, R.B.

66

jecting some rationality in individual behavior that is, however, constrained by economic and social environment. The New Institutional Economics introduces the idea of an individual not being a utility-maximizer but being subjected to bounded rationality.

In this research study Impact of ARCCESS was measured through the experiences of the ARBs within the programs. This ARBs are under the collective groups of cooperatives and farmer organizations which are institutional arrangements, the importance of which has re-emerged recently to organize small farmers in developing countries in the wake of agricultural market liberalization. The advantages of organizing farmers into groups include, among other factors, a reduction in the transaction costs of accessing input and output markets, as well as improving the negotiating power of smaller farmers regarding large buyers or sellers. The history of traditional cooperatives, on the other hand, suggests that cooperatives have not always been successful at serving the needs of its members. One major problem with the traditional cooperatives in developing countries was that members never had a major financial stake in the cooperative; cooperatives were supported by governments. Furthermore, cooperatives suffered from various organizational problems and a lack of clearly defined property rights assignments resulting in opportunistic, bureaucratic inefficiencies, and under-investment in the cooperative. The NIE can inform the structure of such organizations and cooperatives to prevent their failure.

Saemaul Dong Model.

Saemaul Undong was initiated in the early 1970s by president Park Chung-Hee in South Korea. It is a movement for a better living and to develop the work ethics of farmers by participating in village projects to accelerate rural modernization. The aim was to generate economic, social and attitudinal improvement with the broad objectives of enhancing income generation, improvement of living environments and basic rural infrastructure and capacity building. During its initial phase, the focus was to improve the physical infrastructure at village level. Selected projects were developed by the government and given to the villagers as a guideline to help them develop general ideas on what they could do on their own. With the villagers gaining more confidence and experience and with the initial basic infrastructures acquired in the process for improvement in agricultural productivity, the focus of SMU shifted to income generation projects. This was followed by capacity building and attitudinal changes, in the final stage, while the scope of the projects was also broadened simultaneously. Urban areas, factories and corporations were also embraced in the SMU activities, making it a national campaign (Park, 2009).

SMU model has been widely recognized as a successful model of community development in relation to the study, ARCCESS goals were based from it. This model was used as a reference of measurement for the services, implementation and process of the ARCCESS program.

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The gist of the study is all about knowing the impact of the ARCCESS program to the MARILA MPC in Barangay Santisimo Rosario, San Pablo City Laguna. The list of the respondents for the study were acquired and filtered through the DAR-Laguna to determine the Agrarian Reform Community (ARC) that has full access to the ARCCESS program. MARILA MPC was the chosen ARC in which the 86 of the 143 active coconut farmer members are beneficiaries of all the programs under the ARCCESS. A descriptive research was then utilized in order to gain knowledge on the importance, satisfaction levels, number of usage, effects, awareness, and agreements of the MARILA MPC in relation to their insights, observations and experiences to the ARCCESS program. Likert scales were then utilized to quantitatively measure the aforementioned factors. Furthermore, the study identified the economic performance of coconut farming production in terms coconut farming practices, farming productivity and income generation and threats and challenges preparedness as well as the status of the implementation of ARCCESS programs in regards to the accessibility and utilization, quality of services, satisfaction, effectiveness of implementation, organization of process of the program.

Econometric Model. The study employed a multiple regression equation in which dummy variables were inserted to a nominal scale variable to form into regression equation. The variables used for regression were treated according to their level of measurement through the use of MS Excel, Gretl, and SPSS.

Equation 1. Regression Equation

Where: = Constant term or intercept = Partial Regression coefficient; each regression coefficient represents the amount of deviation of the group identified in the dummy variable from the mean of the reference category. = Random error term which contains the myriad other factors that can influence the socio-economic and social conditions the households but not taken into account in the model.

Where: Dependent variables FEC = Farmers Economic Condition CFP = Coconut Farming Practices FRP = Farming Productivity TCP = Threats and Challenges Preparedness Independent variables

The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

METHODOLOGY

Detaunan, Z.A. & Viloria, R.B.

68

AUP = Accessibility and Utilization of the Program of the ARBs QUS = Quality of Services Offered by the Implementers of the Program SAB = Satisfaction of the ARBs on the Program EIP = Effectiveness of the Implementation of the Program in terms of its Objectives OPP = Organization of the Process Involving the Implementation of the Program

DISCUSSION OF RESULTS Summary of Findings. Out of the 143 cooper ative member s Listed on the DAR laguna, the researcher limits only the 86 active members of the MARILA MPC. Using Slovins formula the researcher aimed to survey 71 active ARBs. The 71 ARBs are categorized based on their years in farming attributes. Majority of the ARBs or 41 are 10 years in farming. Also majority of the respondents are land owners or 56 farmers.

There is almost equal distribution of gender for ARBs. 23.9 percent over 59 years old. 38 percent of the ARBs are married with children. ARBs belong only to two income classes D & E There are nine variables that this study used. For the dependent variables, it was categorized into farmers economic condition; coconut farming practices; farming productivity & income generation; and threats & challenges preparedness. For the independent variable that represents accomplishment status made used of accessibility; quality; satisfaction; effectiveness of implementation; and organization process of the program.

The research has studied the impact of accomplishment status of ARCCESS on the farmer economic condition and coconut farming production. The results indicate the following.

A negative relationship between farmers economic condition and access to program; this is validated through the use of CSFs (tractors and floor tillers) in farming. CSFs require minimal rent for usage giving an ARBs additional input that is needed to be funded. According to the ARBs based in MARILA, they are satisfied on the quality of services that the ARCCESS implementers provided. There is also an effective implementation and organization of process confirmed by the ARBs through awareness and their participation in the programs.

A positive relationship between accessibility of the program and farming practices. Farmers who have adapted relatively more recommended technologies also tend to enjoy greater tenure certainty. The ARBs are also satisfied on the programs. However, for the quality of the service , effectiveness of implementation and organization process yield a negative relationship due to their hesitant attitude to change the practices into more innovative and technology based .

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The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

A positive relationship between accessibility; quality of service & satisfaction on the program; and farming productivity. Farmers who are part of the ARCCESS increases their productivity yield and harvest. However for the effectiveness of implementation and organization process yield a negative relationship due to their perspective the program did not really help them to increase their output.

A positive relationship between accessibility and threats & challenges preparedness. Farmers are part of ARCCESS but they are left undecided regarding the effect of the threats. However, for the satisfaction, quality of service, effectiveness of implementation, and organization process yield a negative relationship due to of PCOC on the contacts of the ARBs that affect their perspective on the program.

For the generalization ARCCESS has been successful through its accomplishment in the MARILA MPC. However on the side of the mitigation of threats, the perspective of the program ARBs are negative due to the PCIC feud.

Table 2. Composite Mean and verbal Interpretation of the Dependent Variables

Coconut Farming Practices**

Farmers Economic Condition*

3.34 (UD)

3.35 (MS)

3.50 (A)

1-6 years

3.33

3.00 (UD)

3.07 (MS)

3.91 (A)

7-9 years

3.37

3.19 (UD)

3.12 (MS)

3.81 (A)

10 years and above

3.18 (UD)

3.15 (MS)

3.77 (A)

TOTAL

COMPOSITE MEAN and Verbal Interpretation

Threats and Challenges Affecting Production*** 3.40

STATEMENTS

COMPOSITE MEAN

Detaunan, Z.A. & Viloria, R.B.

Source: Survey administered by the Researcher *Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Fair (F); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA) **Note: 0 Not Applicable (N/A); 0.1-1.7 Not Satisfied (NS); 1.8-2.5 Slightly Satisfied (SS); 2.6-3.3 Moderately Satisfied (MS); 3.4-4.1 Very Satisfied (VS); 4.2-5 Extremely Satisfied (ES) ***Note: 0 Not Applicable (N/A); 0.1-1.7 Not At All (NAA); 1.8-2.5 Not Really (NR); 2.6-3.3 Undecided (UD); 3.4-4.1 Somewhat (SW); 4.2-5 Very Much (VM)

70

2

0

1

0

14

20.1% -40%

40.1% -60%

60.1% - 80%

80.1% above

TOTAL

100.0

0.0

7.1

0.0

14.3

78.6

16

3

2

1

3

7

100.0

18.8

12.5

6.3

18.8

43.8

41

1

0

3

8

29

100.00

2.4

0.0

7.3

19.5

70.7

71

4

3

4

13

47

TOTAL

100.0

5.6

4.2

5.6

18.3

66.2

% Share

TOTAL

4.1% above

3.1%4%

2.1%3%

1.1%2%

Below 1%

Harvest %

7-9

%

14

0

0

5

6

3

100.0

0.00

0.00

35.7

42.9

21.4

16

0

0

2

12

2

100.0

0.00

0.00

12.5

75.0

12.5

years Share years Share

1-6

41

0

0

9

27

5

above

and

years

10

0.00

0.00

22.0

65.9

12.2

Share

%

100.00

Years in Farming

71

0

0

16

45

10

TAL

TO-

100.0

0.00

0.00

22.5

63.4

14.1

Share

%

The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

Source: Survey administered by the Researcher

11

10 1-6 % 7-9 % years % years Share years Share and Share above

Less than 20%

Yield

Years in Farming

Table 3. Distribution of Percentage Change of Yield and Percentage Change of Harvest in Relation to Years in Farming-

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Table 4. Composite M ean and verbal Interpretation of the Independent V ariables

Effectiveness of the Implementation of the program in terms of its objectives ****

Satisfaction of the ARBs on the program***

Quality of Services offered by the implementers of the Program**

Accessibility and Utilization of the program of the ARBs*

3.37 (F)

3.56 (A)

3.31 (MS)

3.17 (G)

3.37 (S)

1-6 years

3.31

3.29 (F)

3.45 (A)

3.26 (MS)

3.36 (G)

3.20 (S)

7-9 years

3.36

3.44 (A)

3.44 (A)

3.25 (MS)

3.36 (G)

3.28 (S)

10 years and above

3.40 (A)

3.47 (A)

3.26 (MS)

3.32 (G)

3.28 (S)

TOTAL

COMPOSITE MEAN and Verbal Interpretation

Organization of the Process involving the implementation of the program****

3.36

STATEMENTS

COMPOSITE MEAN

Detaunan, Z.A. & Viloria, R.B.

Source: Survey administered by the Researcher *Note: 0 Not Applicable (N/A); 0.1-1.7 Never (NV); 1.8-2.5 Almost Never (AN); 2.6-3.3 Sometimes (ST); 3.4-4.1 Almost Everytime (AE); 4.2-5 Frequently (F) **Note: 0 Not Applicable (N/A); 0.1-1.7 Poor (P); 1.8-2.5 Fair (F); 2.6-3.3 Good (G); 3.4-4.1 Very Good (VG); 4.2-5 Excellent (E) ***Note: 0 Not Applicable (N/A); 0.1-1.7 Not Satisfied (NS); 1.8-2.5 Slightly Satisfied (SS); 2.6-3.3 Moderately Satisfied (MS); 3.4-4.1 Very Satisfied (VS); 4.2-5 Extremely Satisfied (ES) ****Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Fair (F); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

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-0.651 0.696 0.292

0.290 0.823 0.155 0.007

Accessibility and Utilization

Quality of Services

Satisfaction of the ARBs

Effectiveness of the Implementation

Organization of the Process

Adjusted R-squared

P-value(F) 0.000

0.293

-0/0166

-0.710

0.213

-0.646

0.800

4.54

Model 2 Coconut Farming Practices

0.048

0.090

-0.357

-0.392

0.0625

0.125

0.218

2.20

Model 3 Farming Productivity

0.000

0.292

-0.0666

-0.196

-0.0604

-00221

0.726

2.53

Model 4 Threats and Challenges Affecting Production

The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

Source: Survey administered by the Researcher

-1.17

Constant

Estimation of Parameters

Model 1 Farmers Economic Condition

Table 5. Results from Regression Analysis

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Detaunan, Z.A. & Viloria, R.B.

74

CONCLUSIONS Land reform, social ties among ARBs; existence of government support; strong political commitment on the part of government; and incentive system and competition among ARBs have positively contributed to the success of ARCCESS in the MARILA MPC. ARCCESS was implemented as part of PDP 2011-2016 rural development that gives the importance to agricultural sectors of the country, guaranteeing the strong commitment for institutional support for the ARBs. Respondentâ&#x20AC;&#x2122;s Profile. The r espondents of this r esear ch study are characterized mainly by ARBs who have a full access on the program.

However, being a beneficiary of the ARCCESS includes being part of a certain ARBOs, thus the other 44 ARCs are not guaranteed to have a full access on the program. There are also variations in terms of demographic particularly in age bracket, civil status, years in farming and land ownership. Given the ARCCESS, there are still numerous ARBs that were recorded by the researcher to have complications during and after pregnancy such as Urinary Tract Infection, Severe Infections, among others.

The status of ARCCESS given by DAR-Laguna and MARILA MPC of Barangay Santisimo Rosario proves that not all registered beneficiaries have full access on the program The total beneficiaries registered are not matched with the total services rendered throughout the year for ARCCESS. There are 143 subscribed ARBs but there are only 86 who have the full access.

Significant Impact of the accomplishment status of ARCCESS to the MARILA MPC. For the findings on the access of the pr ogr am, it was recorded that most of the ARBs participate in the program and uses the given equipment and machineries for their everyday farming. An exception is the PCIC wherein they refused to avail again due to the contract fued. The Quality of Services rated by the ARBs, the majority of which states that it is very good with the exception on the insurance part.

This was affected by the feud with PCIC. On the other hand, the Satisfaction on the program, the results stated that the ARBs are very satisfied with support services provided by DAR through the program ARCCESS. Furthermore, for the Effectiveness of the Implementation, the ARBs agree that the program achieved its goals through the improvement of their farming, capacity to provide for the family, improving their productivity, mitigating the threats and access to the water systems.

Moreover the Organization of the Process, the ARBs agree that all the procedures and processes under the program are in orderly and systematic from program membership to cooperative membership to the access of the program until to the benefits of the program. Also, the Accessibility of the program was the most significant variable for the ARBs economic condition. Providing access to the ARBs is the first way to inculcate them into the program. Additionally, the Accessibility & Quality of Services were the two most significant variable for farming practices. Providing

POLICY RECCOMENDATIONS After two successful implementation of ARCCESS in Nueva Ecija and Bulacan, one key issue of concern in the implementation of rural development programs that has been encountered in the study of ARCCESS is the lack of experimentation and piloting. Though most of the policies and strategies are quite attractive and sound on paper, there have been failures implementation-wise, probably due to lack of piloting as well as lack of implementing capacity at grass roots level. For instance, the PCIC crop insurance as part of the preparedness for threats and challenges is one of such program implemented without any prior piloting. Therefore, capitalizing on the similarities and enabling conditions already existing and through careful planning and judicious use of existing institutions, a similar community development movement can be worked out for implementation in some selected ARBs at a pilot level.

New strategies should be developed to increase the engagement of the inactive members of the program. Giving incentives should be considered. PCIC loans should bring back to its minimal interest to make the ARBs insure their crops. Improvement on the promotion of the crop loan to the ARBs. The program can be implemented in phases, starting with infrastructure improvement in the first phase and moving on sequentially to income generation project (farm and non-farm), community building , socio-cultural development and health & sanitation projects to be implemented in a performance-based approach.

Based on these final projects scaling up of the program nationally and be subsequently carried out through close monitoring and evaluation.  Passage of new bills and laws that can address all the shortcomings and loopholes of the past issues in agriculture is needed. Also providing more and active support services that will help the rural farmers on the agriculture sector is needed. 

Local Government Units (LGUs) should offer the promotion of the program to inform other people in the area that an agricultural program is present. The LGU should develop stud-

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The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

the ARBs access gave them new knowledge for the innovative way of farming and due to the quality of services the ARBs are encouraged to try and used the new farming practices. Likewise, the Effectiveness of Implementation was the most significant variable for productivity.

Proper way of implementing the rules and proper way of following was needed to increase their productivity. Lastly, it can be inferred that ARCCESS proves to have a significant impact to farmer’s economic condition, coconut farming practices, farming productivity and threats and challenges preparedness.

ies that will help the cooperative to encourage more farmers to be part of the program. .

Detaunan, Z.A. & Viloria, R.B.

76



The MARILA MPC should encourage other active members to go through the seminars and other programs to engage them more. Enforcement of incentive program can be used as an aid to involved and attract more program beneficiaries.



The Department of Agrarian Reform should develop measures to communicate and easily transfer data that updates the database of the farmers between the ARBs and the DAR. Improving the quality of service to gain more satisfaction from the program beneficiaries is needed.



Simplified and improve promotion should increase the involvement of other prospect program beneficiaries. Complicated and abstract constructs should be replaced and simplified with language that people can understand and remember. Promotion require commune leader expertise and patience.

REFERENCES Agarwal, B., & Agrawal , A. (2017). Do Farmers Really Like Farming?

Oxford Developments Studies.

Attfield, R., Hattingh, J., & Matshabaphala, M. (2014). Sustainable De velopment, Sustainable Livelihoods and Land Reform in South Africa. Third World Quarterly, 406-421.

Banaji, R. (2009) The Limits of Studies in Comparative Development of East Asia and Latin America: the case of land reform and agrarian policies, Third World Quarterly, 30:4, 761-777 Borras , S. M. (2008). Competing V iews and Strategies on A grarian Re form Volume 1: International Perspective. Quezon City: Ateneo De Manila University Press.

Borras, S. M. (1998). The Bibingka Strategy in Land Reform Implemen tation: Autonomous Peasants and State Reformists in the Philip pines. Quezon City: Institute for Popular Democracy.

Borras, S. M. (June 2000). CA RP in its 12th Y ear: A Closer Examination of the Agrarian Reform Performance 1.

Department of Agrarian Reform. (October 2013). Study on the Impact of CARP on Poverty Reduction and Prospects for Long-Term Growth. Asia Pacific Policy Center.

Department of Agrarian Reform (DAR). (2017). Retrieved from Depart ment of Agrarian Reform: http://www.dar.gov.ph/about-us/ agrar ian-reform-history DAR-ARCCESS. A grarian Reform Community Connectivity and Economic Support Services (ARCCESS). (2013). Retrieved from Department of

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The Impact of ARCCESS to the ARBs of Coconut Farms: A Case in MARILA Multi-Purpose Cooperative in Barangay Santisimo Rosario, San Pablo City, Laguna

Agrarian Reform: http://www.dar.gov.ph/mfos/program- ben eficiaries-development/289-arccess1 Freneo, R. O., & Serrano, M. R. (1991). Problems and Prospects of Agrarian Reform Implementation. Manila: Friedrich-EbertStiftung.

Gujarati , D., & Porter , D. (2009). Basic Econometrics. Singapore: McGrawHill.

Gumede, V. (2014) Land reform in post-apartheid South Africa: Should South Africa follow Zimbabwe's footsteps?, Inter national Journal of African Renaissance Studies - Multi-, Inter- and Transdisciplinarity, 9:1, 50-68, DOI: 10.1080/18186874.2014.916877 Hart, T. G. (2012). How Rural Reform Policy Translates into Bene fits. Development Southern A frica, 563-573.

Khundker, N. (2007). Status of A grarian Reform and Rural Devel opment in CIRDAP Member Countries . India: CIRDAP. Lund, C. (2011). Fragmented Sovereignity: Land Reform and Dis possession in Laos. The Journal of Peasant Studies, 885905.

McCarthy, J. (2007). Shifting Resource Entitlements and Govern ance Reform During the Agrarian Transition in Sumatra, Indonesia. The Journal of Legal Pluralism and Unofficial Law, 95-121.

Moyo, S. (2011) Changing agrarian relations after redistributive land reform in Zimbabwe, The Journal of Peasant Studies, 38:5, 939-966, DOI: 10.1080/03066150.2011.634971 Park, G., & Amati, M. (2009). Institutional Setting, Politics and Planning: Private Property, Public Interests and Land Re form in Japan. International Planning Studies, 41-1601.

Souza, S., & Silva, E. (2011). Planning Land Reform on a Regional Scale: A Case Study from Brazil. Planning Theory and Practice, 569-590.

Van-Wyk, K. (2011) Disciplined stories in the governance of the New Institutional Economics, Journal of Economic Meth odology, 7:3, 341-371 Wooldridge, J. M. (2006). Introductory Econometrics: A Modern Approach (5th Edition ed.).Michigan, United States: SouthWestern Cengage Learning.

World Bank. (2015). World Development Report 2015. Washing ton D.C.: The World Bank.

Zarin, H., & Bujang A. (1994). Theory On Land Reform: A n Over view. Malaysia.

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas Cherise Andre Austria & Mikhail Nacino San Beda University

Abstract

The objective of this study was to analyze the effectiveness of the input assistance of specific Government Support Programs to the coffee farmersâ&#x20AC;&#x2122; production yield, quality of production, skills improvement, buyers frequency, and increase in buyers. A total of 85 respondents were interviewed using questionnaires in the selected barangays in Lipa City, Batangas. However, only 31 out of the total 85 respondents participated in the Government Support Programs. Those who did not participate was due to the lack of information regarding such activities and some had personal reasons as to why they chose not to participate in the programs.

The input assistance were in terms of Agricultural Input which is the provision of seedlings and farming materials, Technical Assistance which is conducting of seminars and trainings on efficient farming methods and skills, and Financial Assistance which is providing fiscal aid. The analysis of the results showed that the input assistance have significant effect on the farmersâ&#x20AC;&#x2122; production yield, quality of production, skills improvement, buyers frequency, and increase in buyers.

JEL Classification: Q100, Q120, Q130, Q150, Q180 Keywords: Agricultural Economics; Coffee production; Government Support Programs, Government Agricultural Policy

INTRODUCTION A global coffee shortage is brewing. The world could face massive coffee shortage is production does not increase to meet its growing demand. According to Luckerson (2015), to keep up with the demand, the global coffee production must increase by forty to fifty million bags in the next decade. With the increasing number of consumption as well as coffee drinkers, especially the Millennials in the emerging markets, are putting even greater pressure on the production. Many studies and statistics show that coffee is the third most consumed beverage in the world, after water and tea. Hence, the high demand of coffee everywhere (Szenthe, 2015).

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An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

Philippine Coffee Situation. The coffee shor tage and the increasing demand of coffee is actually an opportunity for the Filipino coffee farmers. Conserva (2017) reported that the Department of Trade and Industry (DTI) encourage the coffee farmers to make use of the ‘opportunity’ to increase their production to cope with the country’s demand. Besides the low prices and climate change, the shortage of coffee supply in the Philippines was due to the low production because of ageing (senile) trees and lack of farmers. The decreasing number of farmers was due to the youths venturing to other sectors instead of “getting their hands dirty” from farming, the lack of interest also contributes to the decrease. The other challenges that the coffee farmers faces are natural disasters which devastates the crops. The consumption of coffee in the Philippines is three million 60KG bags of coffee in 2016 (International Coffee Organization, 2017). In the report by Rappler (2015), a Kantar Worldpanel study showed that every Filipino household buy coffee, more specifically the soluble or instant coffee (3-in-1 varieties) which considered coffee to be one of a household staple even among the lower economic classes. To plug the shortfall in domestic coffee production, Philippines have to import an average of 70,000 metric tons (MT) of coffee beans. This is because local coffee production remains unable to meet the national consumption due to low production and uncompetitive pricing for local coffee products (Cayon, 2016).

Coffee Production in Lipa City, Batangas. The fir st coffee tree was introduced in Lipa, Batangas in 1740 by a Spanish Franciscan monk. From there, coffee growing spread to other parts of Batangas like Ibaan, Lemery, San Jose, Taal, and Tanauan. Batangas owed much of its wealth to the coffee plantations in these areas and Lipa eventually became the coffee capital of the Philippines. In the late 19th century, Lipa became a famous coffee exporter. Lipa was the first Coffee Capital of the Philippines. In 1880, the Philippines was the fourth largest exporter of coffee beans, and when the coffee rust hit Brazil, Africa, and Java, it became the only source of coffee beans worldwide (Philippine Coffee Board, n.d.).

The glorious years of Batangas Coffee came to a halt when the disease coffee leaf rust hit the plantations in the 1900s. It greatly affected the national coffee production since Batangas was a major producer of coffee. Other factors — the war, cheaper coffee from elsewhere, general loss of interest in farming, ensured the downfall. In the aftermath, an immune-to-rust variety of coffee called Robusta, with smaller beans,was planted in the whole country, where they flourished.

The barako and the Batangueños identity were lost, and bringing back that identity was an important motivation for Batangueños to revive the industry that hailed Batangas coffee back then. To bring back those glorious years may be colossal in the present time, because the dilemma lies in the number of people to cultivate coffee (Cantos, 2013).

Government Policy. Republic Act (RA) No. 7900, An Act to

Austria, C. A. & Nacino, M.

80

Promote the Production, Processing, Marketing and Distribution of High -Value Crops, Providing Funds, therefore, and for Other Purposes or known as the High-Value Crops Development Act of 1995 defines highvalue crops (HVC) as crops other than traditional ones which include coffee. Also, in RA 7900, Declaration of Policy, it states the declared the policy of the State to accelerate the growth and development of agriculture in general, enhance productivity and incomes of farmers and the rural population, improve the investment climate, competencies and efficiency of agribusiness and develop high-value crops as export crops that will significantly augment the foreign exchange earnings of the country, through an all-out promotion of the production, processing, marketing, and distribution of high-value crops in suitable areas of the country. Table 1 below shows the proponent of the programs by the RA 7900.

Table 1. Proponents of the Program Proponent

Description

Market Link- The Department of Agriculture, in coordination with the Department of age Trade and Industry, shall link-up agribusiness cooperatives directly with consumers cooperatives, agro-processing companies, or exporters to provide marketing outlets and assure relatively higher and stable prices.

Technical and Technical support on research and extension, infrastructure developInfrastructure ment, financial and market information shall be provided by the DepartSupport ment of Agriculture, Department of Trade and Industry, Department of Science and Technology, Cooperative Development Authority, state universities and colleges and other relevant government agencies.

Post Harvest Facilities

Access to post harvest facilities, storage and distribution/transport facilities of existing government agencies shall be facilitated. Assistance shall be given to qualified and viable farmers/growers cooperatives in the availment of soft loans or grants for the construction of postharvest, processing and storage facilities.

Good seeds and planting materials

the Department of Agriculture, in coordination with the state universities and colleges, the Department of Trade and Industry, and farmers organizations shall make good seeds and materials readily available to farmers/farmers' cooperatives to ensure high yield and good quality produce. However, the project proponents may be allowed to import, free of duties, high quality seeds/planting materials subject to quarantine laws

Fiscal Incentives

The same fiscal incentives granted by the Board of Investments shall be automatically granted to project proponents.

Source: Department of Agriculture and Department of Trade and Industry, 2017; Chan and Robles, n.d.

Objective of the Programs. With this pr oject, the City Agr iculturist Office of Lipa propagated 3,000 barako coffee seedlings and distributed 7,000 assorted planting materials. It also launched training, semi-

Table 2. Objectives of the Programs Philippine Coffee Industry Roadmap



 



Provide a comprehensive assessment of the Philippine coffee industry Analyze market trends and identify opportunities define goals and formulate strategies to increase yield, lessen importation and improve farmer’s income Recommendation plans using the coffee value chain framework for 2017 to 2022 for a competitive and vibrant Philippine coffee industry

Kapeng Barako Revival Project



  



Encourage Lipeños (non-farmers) to plant coffee if they have vacant lands Encourage non-coffee farmers to start planting coffee Distribute free seedlings to farmers Provide technical assistance and training on coffee farming to ensure an integrated approach Infrastructure project such as harvesters to be used for coffee production for efficiency purposes

HVCD Program







Food Security, Attain food sufficiency and economic growth Help increase income, create livelihood opportunities and contribute to the Philippines’ agricultural development Support the promotion of the production, processing and marketing and distribution of high value crops

Source: Department of Agriculture and Department of Trade and Industry, 2017; Office of the City Agriculturist – Lipa City, 2017

OBJECTIVES OF THE STUDY At the core of this study, the general objective is to analyze the Government Support Programs to the local coffee production in the selected barangays in Lipa City, Batangas. Specifically, the study wants to know more on how effective the input assistance given through the Government Support Programs is towards the current status of the coffee production in selected barangays in Lipa City, Batangas. As part of the analysis, it is focused mainly on determining the level of effectiveness of Agricultural Inputs, Technical Assistance, and Financial Assistance while also looking at both factors and volume of production of the local coffee production. To its end, this study aims to uncover the significance between the relationship of both variables to

81

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

nars and conventions for new technology in liberica coffee production this year.

Table 2 shows the overview of the objective of the programs.

The common strategic directions of all of the programs are the provision of quality planting materials to enhance productivity and production.

82

find out the implications of the Government Interventions and propose possible recommendations that will further develop and improve the program.

Austria, C. A. & Nacino, M.

REVIEW OF RELATED LITERATURE Factors Influencing Coffee Production Agricultural Inputs to Productivity. Low yield was due to low utilization of inputs, low adoption of improved cultivars, poor agronomic practices and high incidences of pests and diseases. High pests and diseases irrespective of high adoption of fertilizer was due to underutilization. Additionally, Low quality hence price and production was due to low level of management like underutilization of inputs, high preference of pests and diseases, poor agronomic practices and poor quality coffee cultivars. Low price hence production was also due to limited domestic coffee consumption, lack of value addition, prohibitive laws restricting farmers participate in marketing and value addition and lack of direct marketing opportunities (Watheri, 2014) In the study of Minai, Nyairo, and Mbtaru (2014), the explanatory variables found to have significantly contributed to the dependent variable (yield) were access to adequate credit, having some source of cash from other enterprises or employment and consulting extension agents. It was also found out that although price has a positive influence on yields, the impact of price on yields is dampened by the socio-economic factors that farmers finds themselves in. This implies that although good prices encourage farmers to invest in coffee, there is need for an enabling environment in terms of adequate credit, extension services provision and diversification of farmersâ&#x20AC;&#x2122; incomes in order to increase coffee yields significantly.

Technical Efficiency. Bhatt and Bhat (2014) also showed that most of the farms are operating at low-level technical efficiency. Farm size and productivity efficiency relationship was found to be non-linear, where large farms tend to have higher net farm income per acre and are technically efficient compared to the small farms. Similar to the study of Ngeywo et al. (2015), both studies show that production is low because the size of the farm is small that is being allocated for coffee production.

A similar study done by Dolisca and Jolly (2008), where they evaluate farm level analysis indicate strong evidence that age, credit access efficiency for bean (a traditional crop) and potato (a non- and gender are important factors for improving technical traditional crop) and the factors influencing technical efficiency level for both bean and crop production efficiency level of those farms in Haiti. The results of the study show that farm production involves technical inefficiency which suggests that improvements in technical efficiency represent a greater opportunity for promotion crop production. Dolisca and Jolly (2008) stated that this could be done through promotion of local innovative crop and better use of available resources given existing technology for such crops. By promot-

83

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

ing local innovative practices may offer an opportunity to help farmers increase production through adoption of these practices. The important factors for improving technical efficiency are credit access and age.

Access to credit encourages technological innovation by acting as an insurance mechanism in agrarian economies. Age wise, it shows that the younger and more educated farmers exhibited higher levels of technical efficiencies.

Government Intervention on Coffee Production. In the study of Thuku et al. (2013), the results show that despite the many efforts put by the government to bring changes in the coffee sector, the results indicates that only commercialization of many millers could spur a change on coffee productivity. In view of this, there is need to reform the cooperative societies which have a major and direct impact on farmersâ&#x20AC;&#x2122; access to credit, inputs and the level of returns. This is because this is the only mechanism used to implement the reforms from the government to the coffee farmers. As such there is need to address problems such as poor governance, huge debts and structural problems that plague coffee co-operatives. The huge debts accrued by these cooperatives significantly increases the deductions made by the societies leading to low pay-out to farmer since the proceeds from coffee sales goes to servicing the debts.

Code of Good Agricultural Practices (GAP) for Coffee.

The standard particularly that of Good Agricultural Practices (GAP), provides guidance to farmers and other relevant stakeholders through principle-based practices from preplanting operations up to postharvest handling. These practices are focused on ensuring food safety, produce quality, workers welfare and environmental management. To support the coffee industry, the Bureau of Agriculture and Fisheries Standards (BAFS) in collaboration with the experts of the Technical Working Group (TWG), developed the Code of Good Agricultural Practices (GAP) for Coffee.

This GAP for Coffee addresses the essential principles of food safety applicable to primary production through primary processing and packing of green coffee beans. It encompasses relevant provisions of Good Hygienic Practices (GHP) and Good Manufacturing Practices (GMP), as far as applicable, which will help minimize microbiological, chemical and physical hazards associated with all stages of production to processing.

The development of GAP for Coffee aims to assist farmers/ growers to provide assurance on safety and quality of harvested and/or processed green coffee beans. It also aspires to be used as basis for the provision of appropriate assistance and technical support to increase productivity, improve quality and use of natural resources, and comply with at least minimum sustainability, leading to improved farmer income and making coffee farming attractive to future generations of coffee farmers/growers.

Coffee Production in Philippines.

Austria, C. A. & Nacino, M.

84

Rodolfo, Calsiyao, Duclayan, and Himson (2016) stated that Philippine coffee production and exports has declined in recent years due to factors such as low buying price, out-dated production practices, unproductive coffee trees, diversification into other crops, as well as lack of post-production and processing facilities. The results of the study, In terms of the problems encountered, according to the farmers low yield productivity comes first as attributed to different factors such as old coffee trees, no fertilizer application, insufficient weeding activities, high densities of coffee stands and insufficient labor. Old coffee trees decline in terms of its yield productivity due to its multiple branches that are not productive which absorb some of the nutrient required for the fruiting branches. Farmers revealed that they donâ&#x20AC;&#x2122;t apply fertilizer in their coffee farms which is known â&#x20AC;&#x153;organic by neglect,â&#x20AC;? coupled with aging coffee trees. Come second is the lack/insufficiency of farm to market road/ transportation problems. Farmers revealed that with this difficulty of transportation they are constraint in doing activities of their coffee farms such as weeding, pruning, mulching and other activities. The third problem encountered was the inaccessibility to market which command better price. The picking and drying of coffee berries affect the final quality of the coffee and also because of the lack of drying facilities. The absence of post harvesting facilities such as dehuller/pulper affects the quality of the coffee beans produced. Inaccessibility to short and long term credit is another challenge. Farmers revealed that because coffee bear fruits once year, they have difficulty in persuading credit institution to lend them money for the improvement of their production activities. Insufficient knowledge on proper harvesting, drying, and storage of coffee beans is recorded a problem. Though they revealed that they have experiences that picking the ripe berries will give them better aroma and flavor, the traditional harvesting which is stripping is still employed. These practices of strip harvesting, improper drying and storage contribute to the degradation of the coffee quality. Like other agricultural venture, there are interventions necessary to deliver better quality and yield productivity.

Among the first intervention is the linking of farmers to market which commands better price. They exposed that when market price of coffee becomes high and stable, they will be energized to revitalize their coffee farms.

Agricultural Economics.

Agricultural economics is the study of the allocation, distribution, and utilization of the resources used, along with the commodities produced, by farming. Agricultural economics plays a role in the economics of development, for a continuous level of farm surplus is one of the wellsprings of technological and commercial growth. Agricultural producers are individuals, families, or firms that grow and sell agricultural products (Barkley and Barkkey, 2013).

The field of agricultural economics includes agricultural finance, policy, marketing, farm and agribusiness management, rural sociology, and agricultural law. Agricultural policy is concerned with the relations

Equation 1. Classical Production Function.

Where Y is the output and X is the inputs.

The theory of the firm is studied in production economics, which is a field of microeconomics. In traditional production economics, firm level decision-making, production, and risk are studied. A number of theoretical concepts are used to understand production economics including profit maximization, cost minimization, marginal cost, and marginal physical product. In recent decades, production economics has examined competitiveness, efficiency, productivity and other related issues. More recently, production economics has evaluated emerging issues such as the impact of agriculture/environmental interactions on the production of farm firms and regulatory reform such as government support programs. The overall objective of production economics is to improve the optimal allocation of resources in the agricultural production process which in turn leads to increased wealth or individual welfare as well as improved policies directed towards the firm (Goddard et al., 2012; Beattie and Taylor, 1985; Doll and Orazem, 1984).

85

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

between agriculture, economics, and society (Barkley and Barkely, 2013; Curtis et al., 2016) Agricultural Production Economics. According to Kumar (2014), Agricultural Production Economics is a sub-discipline within the broad subject of agricultural economics and is concerned with the selection of production patterns and resource use efficiency so as to optimize the objective function of farming community or the nation within a framework of limited resources. It may be defined as an applied field of science wherein principles of economic choice are applied to the use of resources of land, labor, capital and management in the farming industry.

Production Theory. Production is defined as the process through which some goods and services called inputs are transformed into other goods called products or output (Beattie and Taylor, 1985).

Production function is a technical and mathematical relationship describing the manner and extent to which a particular product depends upon the quantities of inputs or services of inputs, used at a given level of technology and in a given period of time. It shows the quantity of output that can be produced using different levels of inputs (Kumar, 2014).

The classical production function is a purely technical relationship that relates or connects factor inputs and outputs (Koutsiyannis, 1994). It describes the rate at which inputs are transformed into outputs. The production function is as follow:

Austria, C. A. & Nacino, M.

86

Amartya Senâ&#x20AC;&#x2122;s Development as Freedom.

According to Amartya Sen (2001), development can be seen as a process of expanding the real freedoms that people enjoy. Also, Sen (2001) states that development requires the removal of major sources of unfreedom: poverty as well as tyranny, poor economic opportunities as well as systematic social deprivation, neglect of public facilities as well as intolerance or over activity of repressive states. The lack of freedom has a direct relationship to economic poverty, which ultimately deprives people of the freedom to their basic needs. In this context of development as freedom, Sen used poverty as an example of the result of inadequate functioning with lack of entitlements and capabilities which leads to the individuals and households being unable to secure their well-being. Poverty is linked to more than just a lack of income; rather it is recognized to be a lack of a range of capabilities and freedoms which varies in individual and collective circumstances.

Figure 1. Amartya Sen's Development as Freedom

Source: Sen, 2001

The application of the framework is shown in Figure 2 below.

Figure 2. Application of Amartya Sen's Development of Freedom

METHODOLOGY To meet the demands of this study, a descriptive research that made use of quantitative analysis was applied to meet the objectives of this study. Furthermore, the quantitative attributes of the variables were obtained using categorical and interval questions such as yes/no, multiple choice, checklist, and Likert Scale questions.

The objective of this study, as stated before, is to analyze the Government Support Program and its assistance to the farmers in Lipa City. The list of respondents was acquired from the Office of the City Agriculturist on which it detailed who are the farmer beneficiaries.

Through survey questionnaires, the farmer beneficiaries were interviewed about their factors of production and volume of production.

Furthermore, the level of effectiveness of the government input assistance towards them were assessed to in order to formulate policy recommendation for the further improvement of the state of the coffee production in Lipa City.

Econometric Model. A multiple regression equation was utilized by the researcher in mathematically explaining the relationship of each independent variable has towards the dependent variables. The multiple regression analysis is also used in describing data turned into economic realities that will reflect researchâ&#x20AC;&#x2122;s results.

87

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

Concept of Inclusive Business.

According to Domingo and Bauer (2013), Inclusive Business (IB) is generally defined as commercially viable and profit making private companies in the growth stage; whose core business is designed to address â&#x20AC;&#x201C; in scale â&#x20AC;&#x201C; pressing social needs of the poor and vulnerable people below the $3 international poverty line, also referred to as the Base of the Pyramid (BoP); by engaging them through the provision of affordable and relevant goods and services and through income and decent work opportunities, in a manner that results in measurable improvements of their living situation; and as a systemic contribution to poverty reduction and inclusiveness for the country/region. The key in this system is the creation of shared value for both the corporations and microentrepreneurs.

This government program is considered an IB because it partners with the beneficiaries, one of which are the farmers, who are also the BoP, to achieve food security and poverty alleviation for the country by providing them materials needed for farming, training to enhance their skills as well as financial aid. By including the vital role of the farmers in this cycle, the government can be able to achieve its goal as well as to improve the lives of the people responsible for this production.

88

Where:

Equation 2. R egression Equation.

Austria, C. A. & Nacino, M.

Y = Dependent variable = Regression Coefficient, or the change in the value of dependent variable corresponding to the unit change in the independent variable. e = random error, or error from the measurement from several factors that causes variation Where: Dependent Variables Y1 = Production Yield Y2 = Quality of Production Y3 = Skills Improvement Y4 = Buyers Frequency Y5 = Increase in Buyers Independent Variables X1 = Agricultural Input X2 = Technical Assistance X3 = Financial Assistance

DISCUSSION OF RESULTS Summary of the Findings. The r esear cher inter viewed a total of eighty-five farmers across barangays San Benito, San Celestino, Sto. Nino and Talisay. Majority (38.8 percent) of them were sixty-five years old and above and the youngest respondent was between the ages of twenty-three and twenty-seven years old. The respondents interviewed were composed of 25.9 percent females and 74.1 percent males. Majority (87.1 percent) of the respondents were married, and the rest were separated, widowed, or single. As for the respondentsâ&#x20AC;&#x2122; education attainment, 43.5 percent of them finished elementary school, followed by 30.6 percent finished high school, and 16.5 percent graduated college. The rest did have formal schooling at all or took up vocational course. Majority (71.8 percent) of the respondents were both landowners and farmhands themselves, the rest were landowners only, farmhands only or tenants.

Apart from the respondents themselves, 36.5 percent of them have more than five family members living with them in their house while only 3.5 percent are living alone or with only one family member. According to the Philippine Statistics Authority poverty threshold category, the results of the study show that 91.8 percent of the respondents were living above poverty and 5.9 percent were living below the subsistence level.

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An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

From the data gathered, it showed that source of income was the top motivation for farmers to grow coffee with forty-six percent of the total responses. Come second is livelihood with 22 percent. Third, the inheritance of the coffee farm to the next generation with 14 percent. Apart from coffee, the farmers also grew other crops such as black pepper, banana, lanzones, among others. The average size of land that each of the farmers have is about 1.5 hectares and they have an average of 490 coffee trees. Also, the general conditions of the coffee plantation is conducive enough for the coffee to grow. The damage caused by pests and diseases and calamities and natural disasters to the coffee plantation were moderate. The results of the study also show that an average of two family labor and one hired labor work at the farm, and they work for four days a week and two days a week, respectively. The average salary of the hired labor or a farmhand is about 300 pesos a day. The farmer do not use any machineries or equipment in coffee farming, they preferred to use traditional and simple tools. Also, financial capital is extremely important to coffee farming however, eighty-six percent of the respondents do not have access to financial capital. From the data gathered, on average, a farmer produce about nine jute sacks of fresh coffee cherries in a crop year which is about five jute sacks when the coffee cherries dries. The average farm gate price is P40 per kilo for the coffee cherries with husk, and P100 per kilo for the de-hulled coffee cherries. The farmers usually sell it at the trader in the public market located at the city proper.

Out of the eighty-five respondents that the researchers had interviewed, only thirty-one (or 36.5 percent) participated in the government support programs. For those who did not participate the program, their reason was because of lack of information and knowledge about such programs, as well as no available time to participate. In total, farmers who participated “seldom” acquire agricultural input from the government, and these inputs had “somewhat” helped increase their yield and quality of production But they “always” received technical assistance which “very much” helped them improved their skills as well as their yield and quality of production. On the other hand, none of them received financial assistance from the government. From the acquired inputs, it “moderately” increased the frequency and number of buyers of the farmers’ produce.

From the regression results, it shows that the variables in the input assistance by the government support programs have significant effect to the local coffee production in terms of production yield, quality of production, skills improvement, buyers frequency, and increase in buyers. The OLS and ANOVA results shows statistical evidence that supports this. The implication of the results of each of the models suggest that by rejecting the null hypothesis, the input assistance are significant to the farmers’ production yield, quality of production, skill improvement, buyers frequency, and increase in the buyers of the farmers’ produce in Lipa City.

1.84

(NAA)

1.00

(ST)

2.71

(SD)

1.80

San Benito

(SD)

2.00

(NAA)

1.00

(O)

3.50

(SD)

1.50

San Celestino

(ST)

3.09

(NAA)

1.00

(A)

4.93

(ST)

3.34

Sto. Nino

(ST)

2.67

(NAA)

1.00

(A)

4.88

(SD)

2.13

Talisay

(NAA)

1.00

(A)

4.32

(SD)

2.56

TOTAL

COMPOSITE MEAN and Verbal Interpretation

Table 3. Composite M ean and verbal Interpretation of the Independent V ariables

STATEMENTS

Agricultural Input Technical Assistance Financial Assistance

COMPOSITE MEAN (SD)

Source: Survey administered by the Researcher

Austria, C. A. & Nacino, M.

Note: 0 Not Applicable (N/A); 0.1-1.7 Not at all (NAA); 1.8-2.5 Seldom (SD); 2.6-3.3 Sometimes (ST); 3.4-4.1 Often (O); 4.2-5 Always (A) Note: 0 Not Applicable (N/A); 0.1-1.7 Not At All (NAA); 1.8-2.5 Not So Much (NSM); 2.6-3.3 Somewhat (SW); 3.4-4.1 Quite (Q); 4.2-5 Very Much (VM)

90

2.83 (M)

(M)

(NSM)

(NAA)

2.62

2.50

(SW)

(NSM)

1.00

4.00

(VM)

(M)

1.86

4.67

(NAA)

(SW)

3.10

1.50

(NAA)

(SW)

3.57

1.50

San Celestino

(SW)

3.65

(NAA)

1.63

(VM)

4.50

(VM)

4.88

(SW)

3.63

(SW)

3.63

Talisay

(NSM)

1.81

(SW)

3.90

(VM)

4.45

(SW)

3.81

(SW)

3.68

TOTAL

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

Note: 0 Not Applicable (N/A); 0.1-1.7 Not At All (NAA); 1.8-2.5 Not So Much (NSM); 2.6-3.3 Somewhat (SM); 3.4-4.1 Quite (Q); 4.2-5 Very Much (VM)

(VM)

4.01

(NSM)

2.21

(VM)

4.57

(VM)

4.86

(VM)

4.36

(SW)

4.07

Sto. Nino

COMPOSITE MEAN and Verbal Interpretation

3.57

San Benito

Source: Survey administered by the Researcher

COMPOSITE MEAN

Increase in Buyers

Buyers Frequency

Skills Improvement

Quality of Production

Production Yield

STATEMENTS

Table 4. Composite Mean and verbal Interpretation of the Dependent Variables

91

Table 5. Results from Regression Analysis

0.485***

0.00

Production Yield

0.208***

0.350***

0.00

Quality of production

1.624***

0.639***

0.050

0.00

Skills Improvement

Model 3

0.866

0.370

0.627***

0.318**

0.00

Buyers Frequency

Model 4

0.000***

0.642

0.823**

0.138

0.149

0.00

Increase in Buyers

Model 5

Model 2

Agricultural Input 0.295***

0.918***

0.944

0.000***

Model 1

Training Assistance

1.553***

0.901

0.000***

Estimation of Parameters

Financial Assistance 0.921

0.000***

Constant

Adjusted R-squared

0.000***

P-value(F)

Source: Survey administered by the Researcher

Austria, C. A. & Nacino, M.

Note: 0 Not Applicable (N/A); 0.1-1.7 Never; 1.8-2.5 Seldom; 2.6-3.3 Sometimes; 3.4-4.1 Often; 4.2-5 Always

92

After conducting all necessary presentations, interpretations, analysis and statistical tests, this study concludes the following: Respondentsâ&#x20AC;&#x2122; Profile. Of the total population inter viewed, 64.5 percent or 51 respondents did not participate in the program because they were not aware of the program, and those were aware chose not to participate due to personal reasons. Furthermore, the appropriate categorization of the respondents were based on which barangay they came from. There are also variations in terms of socio-demographic profiles of the farmers such as age, gender, civil status, education attainment, employment, household, and income.

Input Assistance. The input assistance of the gover nment support programs are agricultural input, technical assistance, and financial assistance. The technical assistance indicated the highest total weighted mean which mean that this attribute was the input that they received the most. This is because they often receive more training such as attending seminars and workshops, than the agricultural input because sometimes the government agencies do not have available of the input materials or sometimes they do not have enough to give out to the farmers.

The farmers did not receive any form of financial assistance from the government but the farmers said that even without the financial assistance, their farm are still sustainable because of the agricultural input that were given to them. Only sometimes, when they ran out of such agricultural input, financial assistance will be helpful because then they can buy the materials used for farming without sacrificing their income that is meant for their household. However, when their farms are being damaged by typhoons, among another calamities, that is when they need financial assistance to recover from the loss.

Effectiveness of Input Assistance to Coffee Farmers of Lipa City. Input assistance such as Agr icultur al Input which is the pr ovision of seedlings and farming materials, Technical Assistance which is conducting of seminars and trainings on efficient farming methods and skills, and Financial Assistance which is providing fiscal aid were seen to have a significant effect to the production yield, quality of production, skills improvement, buyers frequency, and increase in buyers of the coffee farmers and their produce in the selected barangays in Lipa City.

POLICY RECOMMENDATIONS The findings of this research study served as the basis of the researcher for the recommendations. The researcher takes into consideration that the recommendations should be practical and achievable by individuals and/or government agencies. Time and financial aspect are also considered.

93

An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

CONCLUSIONS

Austria, C. A. & Nacino, M.

94

 Under the banner programs of HVCDP, The Philippine Coffee Industry Roadmap and the Kapeng Barako Revival Project, it may be considered giving a unique name for the service or proponents of the program for the provision of agricultural production materials, equipment and facilities, technical training, and financial assistance, and others. 

The government agencies may consider enacting resolutions that would spread the information of the program especially in those hard to reach areas or barangays in Lipa City to raise awareness for such programs through announcement system per barangay.



The government agencies may also consider enacting resolutions that would provide incentives to farmers to encourage them to participate in the programs.



The frequency of distribution of the agricultural inputs should be made systematic and per batches so that the farmers can regularly receive the materials.



Provision of advanced farming tools to farmers to increase efficiency in farming and to reduce the intensive labor.



Conduct more intensified training to farmers on coffee production, postharvest processing and marketing to further improve yield and quality of coffee beans.



Government agencies may consider establishing demonstration farm especially nursery, plantation and rejuvenation technology for coffee production.



Government agencies can consider linking farmers to lending institutions to finance the production activities.



Link farmers to market with better coffee price.



Conduct a regular follow up to the farmers to monitor their productivity as well as take note of their concerns and needs.



Establishment of network for farmers to communicate their knowledge on coffee prices, and other activities with other farmers so that they all can be well informed on such activities.



Establishment of integrated framework in the promotion of coffee farming the community that would engage the local government and other agencies, farmers, and the locals.

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An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

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An Analysis of the Effectiveness of Specific Government Support Programs to the Local Coffee Production: The Case of Selected Barangays in Lipa City, Batangas

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Granger Causality Between Philippine Government Expenditures and Revenues and Its Policy Implications Lucky Raymundo M. Malveda Consultant, Asian Development Bank

Abstract This paper investigates the direction of the long-run or equilibrium relationship between government expenditure (GOVEXP) and government revenue (GOVREV) in the Philippines by conducting Granger Causality test.

The strong relationship between GOVEXP and GOVREV has been confirmed by the results of the Johansen Co-integration test. As to its direction, revenue-spend hypothesis and spend-revenue hypothesis have been tested. The results of the Granger Causality test suggest that the direction of the long-run or equilibrium relationship runs from GOVREV to GOVEXP. The causality that has been observed has important policy implications for the Philippines.

JEL Classification: H50, H61, H68, P24, P44 Keywords: granger causality, government, expenditures, revenues, policy

INTRODUCTION Over the last twenty years (except from the year 1994 to 1997), the national government has incurred budgetary deficits. Budgetary deficit is a fiscal condition where GOVEXP exceeds GOVREV. According to the Department of Finance (DOF), for 2009 alone the full year budget deficit amounted to PHP298.5 billion or equivalent to 3.9% of the country’s Gross Domestic Product (GDP). This condition implies that government needs to improve on its tax administration and revenue collection effort in order to deviate from its option to sell government assets, borrow further from local and/or foreign creditors or to introduce new tax measures. At present, the national government also needs additional revenues to finance its robust expenditure program that is most responsive to the country’s development needs. With the recent and prolonged fiscal imbalance, it is noteworthy to ask the question: “Would understanding the long-run and causal relationship between GOVREV and GOVEXP help prevent fiscal imbalance from happening and recurring year-on-year?” This is

100

due to the fact that the long-run and causal relationship between two said variables has a significant effect on the countryâ&#x20AC;&#x2122;s fiscal position and on fiscal policies government needs to formulate and implement in order to end the continously ballooning budgetary deficits.

Thus, this paper investigates (i) the long-run or equilibrium relationship between GOVREV and GOVEXP using the Johansen Cointegration test and (ii) the causal relationship between GOVREV and GOVEXP in the Philippines using Granger Causality test over the period 19902008. Given the second objective, this paper tests whether GOVREV Granger causes GOVEXP or vice-versa, and if there is bi-directional causality that exists between GOVREV and GOVEXP.

Malveda, L. R.

THEORETICAL AND CONCEPTUAL FRAMEWORK There are three (3) competing hypotheses tested in many empirical studies in the past that discuss the causal relationship between GOVREV and GOVEXP. These hypotheses include the revenue-spend hypothesis, spend-revenue hypothesis, and fiscal synchronization hypothesis.

The first hypothesis is the revenue-spend hypothesis which implies that an increase in revenue could lead to greater expenditure. This hypothesis views that causality runs from GOVREV to GOVEXP. The second hypothesis is the spend-revenue hypothesis which states that changes in GOVEXP cause changes in GOVREV. According to this hypothesis, the causality runs from GOVEXP to GOVREV. This hypothesis was advocated by Peacock and Wiseman in 1979. The third hypothesis is fiscal synchronization which states that GOVREV decisions are not made in isolation from GOVEXP decisions. This hypothesis implies bidirectional causality, causality running from both directions (Eita and Mbazima, 2006).

In support of the objective of the study, the researcher will test which among the above-mentioned hypotheses explains the causal relationship between GOVREV and GOVEXP in the Philippines over the period 1990-2008.

REVIEW OF RELATED LITERATURE There have been many studies investigating the relationship between GOVREV and GOVEXP that were conducted in the past. These studies involved both stationarity and cointegration tests of the time series data on GOVREV and government GOVEXP. In the case of Botswana, Moalusi (2004) revealed that both GOVREV and GOVEXP are stationary when first differenced using both the Augmented Dickey Fuller (ADF) test and the Philips-Perron (PP) test. The result of its PP test showed that both GOVREV and GOVEXP are stationary in levels. Eita and Mbazima (2008) also found that in Namibia, both GOVREV and GOVEXP are stationary in levels according to Philips-Perron statistics.

Its ADF test statistic indicated that GOVEXP is stationary in levels but

EMPIRICAL METHODOLOGY In this study, the researcher will first employ the unit root test before conducting the Granger causality test. Over the past several years, the use of a stationarity test also known as the unit root test for time series data has become widely popular. Employing the unit root test will first determine whether GOVREV and GOVEXP adhere implicitly to the assumption of stationarity, if its mean and variance do not vary systematically over time (Gujarati, 2004). This test is important because it ensures that the regression of a non-stationary time series variable, say GOVREV, on another non-stationary time series variable, say GOVEXP, would not give nonsensical or spurious results.

The study uses the Augmented Dickey-Fuller (ADF) test for stationarity. If annual Philippine data on GOVREV and GOVEXP are both stationary at level form, the researchers will proceed in conducting the cointegration and causality tests. Cointegration of two (or more) time series data will suggest that there is long-run, or equilibrium, relationship between GOVREV and GOVEXP (Gujarati, 2004). This co-integration test will be performed using the Johansen Cointegration test.

To test for the causal relationship between GOVREV and GOVEXP, the researcher will use the Granger causality test. This Granger causality test was developed in 1969. The idea behind this test is â&#x20AC;&#x153;If event A happens before event B, then it is possible that event A is causing B. However, it is not possible that B is causing A.â&#x20AC;? In other words, events in the past can cause events to happen today. Future events cannot (Gujarati, 2004). The Granger causality test assumes that the information relevant to the prediction of the respective variables, GOVREV and GOVEXP, is contained solely in the time series data on GOVREV and GOVEXP (Gujarati, 2004). This test involves estimating the following pair of regressions:

101

Granger Causality Between Philippine Government Expenditures and Revenues and Its Policy Implications

GOVREV is not. The study used rejection of the null hypothesis of unit root at least by one test to assume a verdict of stationarity. However, in the case of Romania, the unit root tests indicated that GOVREV and GOVEXP are not stationary, suggesting that the variables are integrated of order one. These findings by Mioara and Florina imply that it is reasonable to proceed with test for cointegrating relationships among these series. The studies presented provide evidence of non-fulfillment of the requirements or assumptions of stationarity and absence of a unit root problem before conducting Co-integration Test.

In the case of Iran, Elyasi and Rahimi (2012) proved that there is a bidirectional causal relationship between GOVEXP and GOVREV in both long-run and short-run. These results are consistent with fiscal synchronization hypothesis. In a study conducted by Taha and Loganathan (2008) for Malaysia, the results also showed evidence of a longrun relationship between GOVREV and GOVEXP with unidirectional and bidirectional causality for the sample period 1970-2006.

102

(1)

Malveda, L. R.

(2) where it is assumed that the disturbances u1t and u2t are uncorrelated.

Equation (1) states that the current GOVREV is related to past values of itself as well as that of GOVEXP, and equation (2) states a similar behavior for GOVEXP (Gujarati, 2004). Since two variables (GOVREV and GOVEXP) are involved, the study therefore will deal with bilateral causality.

DATA ANALYSIS, EMPIRICAL RESULTS AND INTERPRETATION This study used an annual Philippine data on GOVREV and GOVEXP over the period 1990-2008. These data were culled from 2009 Asian Development Bankâ&#x20AC;&#x2122;s (ADB) Key Indicators for Asia and the Pacific.

Table 1: Philippine Government R evenue and Expenditure Year

GOVREV (in billion PHP)

GOVEXP (in billion PHP)

Year

GOVREV (in billion PHP)

GOVEXP (in billion PHP)

1990

178.6

219.7

2000

513.4

646.3

1991

217.8

245.6

2001

565.5

710.6

1992

241.0

256.5

2002

577.4

786.5

1993

258.9

279.1

2003

638.5

834.0

1994

335.4

319.2

2004

706.6

888.1

1995

360.2

346.3

2005

816.1

961.2

1996

409.9

403.0

2006

979.5

1044.3

1997

470.1

468.9

2007

1136.4

1139.3

1998

462.1

512.2

2008

1202.8

1256.6

1999

478.2

587.0

Table 1 presents the Philippine data on GOVREV and GOVEXP over the period 1990-2008. GOVREV includes current revenue (taxes and non-taxes) and capital receipts. On a yearly basis, GOVREV was increasing except for the year 1998 where it declined by about 1.70% or an estimated amount of PHP8.0 billion. Over the period under this study, the

103

Granger Causality Between Philippine Government Expenditures and Revenues and Its Policy Implications

highest increase in GOVREV happened in the year 1994 where it posted a positive growth rate of 29.5% or an estimated amount of PHP76.5 billion. On average, the GOVREV has just increased by 11.41% in the period under this study. Table 1 also presents the data on GOVEXP. In this study, GOVEXP is the summation of current expenditure and capital expenditure. Likewise, the GOVEXP was constantly on an increasing trend over the period 1990-2008. The highest increase in GOVEXP happened in the year 1996 with a positive growth rate of 16.37% or an estimated amount of PHP56.7 billion. In contrast, the lowest annual increase in GOVEXP was experienced in the year 1992 with a positive growth rate of only 4.44% or an equivalent amount of PHP10.9 billion.

On average, the GOVEXP increased by just 10.22% in the last 18 years.

Comparing the annual Philippine data on GOVREV side-byside with GOVEXP, it can be noted that the country experienced budgetary deficits in the years 1990-1993 and 1998-2008. However from the year 1994 to 1997, the country experienced budget surplus, a fiscal condition wherein GOVREV exceeds GOVEXP. The budget deficits experienced by the country three years (1990-1992) prior to the end of the term of the Aquino administration were being attributed to high interest rates, accelerated payment of the foreign debt and the implementation of the Salary Standardization Law or SSL (Diokno, 2008).

This spending responsibility by the Aquino administration was increased further by the passage of Republic Act No. 7160 or the Local Government Code (LGC) of 1991. RA 7160 increased the national government spending responsibilities to local government units (Diokno, 2008).

During the initial year of the Ramos administration, the country experienced power crisis that resulted to relatively higher budgetary deficit in 1993 (PHP20.2 billion) than the previous year (PHP15.5 billion). But from 1994 to 1997, the country experienced a reversal on its fiscal imbalance – budget surpluses. These budget surpluses experienced during the Ramos administration were being attributed to the boom of the real estate industry and the huge inflow of foreign direct investment (FDI) coming into the country (Diokno, 2008). However, the healthy fiscal condition of the country for four years under Ramos administration was not prolonged until the country was finally hit by the Asian financial crisis in mid-1998. As a result, the country’s budgetary deficit rose again during the Estrada (19982000) and Arroyo (2001-2008) administrations. These budgetary deficits were being attributed largely to the sharp deterioration in the country’s tax efforts and higher interest payments due to the sharp depreciation of the Philippine peso (Diokno, 2008).

As previously mentioned in the beginning of this study, in order to determine whether there is a long-run or equilibrium relationship or not between GOVREV and GOVEXP, it is imperative to test GOVREV and GOVEXP series for assumptions of stationarity and

Malveda, L. R.

104

absence of a unit root problem. The fulfillment of these assumptions will enable the researcher to proceed in conducting the Johansen Cointegration Test determining the long-run or equilibrium relationship between GOVREV and GOVEXP. Table 2: A ugmented Dick ey-Fuller Unit Root Test Results (Level Form) Variable

ADF Test Statistic

1% critical value

5% critical value

10% critical value

GOVREV

1.146867

-3.8877

-3.0521

-2.6672

GOVEXP

2.503778

-3.8877

-3.0521

-2.6672

Table 2 presents the results of the unit root test both for GOVREV and GOVEXP at level form using the ADF test. The ADF statistics show that both GOVREV and GOVEXP are statistically significant not to reject the null hypothesis that unit root problem exists. For GOVREV, the computed ADF test statistic of 1.146867 exceeds the critical 1%, 5%, and 10% values of -3.8877, -3.0521, and -2.6672, respectively. Likewise for GOVEXP, its ADF test statistic of 2.503788 exceeds the same critical values. Thus, GOVREV and GOVEXP both have a unit root problem and are non-stationary series.

To further validate and affirm the results of the unit root test presented above, the researchers need to conduct the ADF test for both GOVREV and GOVEXP in their second difference. The results of this test validation are shown in Table 3 below.

Table 3: Augmented Dickey-Fuller Unit Root Test Results (Second Difference) Variable

ADF Test Statistic

1% critical value

5% critical value

10% critical value

GOVREV

-3.337537

-3.9635

-3.0818

-2.6829

GOVEXP

-4.218103

-3.9635

-3.0818

-2.6829

Table 3 shows that both GOVREV and GOVEXP are stationary in their second difference form. For GOVREV, the computed ADF test statistic of -3.337537 is smaller than the critical 5% and 10% values of 3.0818 and -2.6829, respectively. Likewise for GOVEXP, its ADF test statistic of -4.218103 is smaller than the critical values at 1%, 5% and 10%, respectively. Therefore, the null hypothesis of nonstationarity and the presence of a unit root problem as validated in the previous results (under first difference) can now be rejected, thereby affirming fulfillment of the assumptions of stationarity and absence of unit root problem in GOVREV and GOVEXP series. And this now will allow the researcher to proceed conducting the Johansen Co-integration Test.

Table 4: Johansen Co-integration Test Results

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Included observations: 17 after adjusting endpoints Trend assumption: Linear deterministic trend Series: GOVREV GOVEXP Lags interval (in first differences): 1 to 1 Unrestricted Cointegration Rank Test

Hypothesized No. of CE(s)

Eigenvalue

Trace

5 Percent

1 Percent

Statistic

Critical Value

Critical Value

None **

0.668388 24.78057

15.41

20.04

At most 1 *

0.298049 6.016150

3.76

6.65

MaxEigen

5 Percent

1 Percent

Statistic

Critical Value

Critical Value

*(**) denotes rejection of the hypothesis at the 5%(1%) level Trace test indicates 2 cointegrating equation(s) at the 5% level

Trace test indicates 1 cointegrating equation(s) at the 1% level Hypothesized No. of CE(s)

Eigenvalue

None **

0.668388 18.76442

14.07

18.63

At most 1 *

0.298049 6.016150

3.76

6.65

*(**) denotes rejection of the hypothesis at the 5%(1%) level Max-eigenvalue test indicates 2 cointegrating equation(s) at the 5% level Max-eigenvalue test indicates 1 cointegrating equation(s) at the 1% level

Table 4 presents the results of the Johansen Co-integration test with Trace and Maximum eigenvalue statistics. As shown in Table 4 above, both the Trace and Maximum eigenvalue statistics indicate that there are two cointegrating equations at the 95% level and one cointegrating equation at the 99% level. Both findings rejected the null hypothesis of non-cointegration at 5% and 1% significance levels. This therefore implies that there is long-run or equilibrium relationship between GOVREV and GOVEXP. However, these cointegration results do not stress the direction of the long-run relationship between GOVREV and GOVEXP. Thus, there is still a need for the researcher to conduct the Granger

Granger Causality Between Philippine Government Expenditures and Revenues and Its Policy Implications

Sample (adjusted): 1992 2008

106

causality test to determine the direction of causality between GOVREV and GOVEXP. Table 5: Pairwise Granger Causality Test Result Pairwise Granger Causality Tests Sample: 1990 2008 Lags: 2 Obs

F-Statistic

Probability

GOVEXP does not Granger Cause GOVREV

17

1.91840

0.18927

GOVREV does not Granger Cause GOVEXP

7.49570

0.00772

Malveda, L. R.

Null Hypothesis:

The presence of co-integration between GOVREV and GOVEXP suggests that there must be Granger causality in at least one direction.

And the result of Pairwise Granger Causality test presented in Table 5 above validated this when the computed probability value 0.00772 did not exceed 5% implying the rejection of the null hypothesis that GOVREV does not granger cause GOVEXP. This result also further implies that there is only unidirectional causality that exists between GOVREV and GOVEXP, the one consistent with revenue-spend hypothesis. Revenue-spend hypothesis posits that an increase in revenue could lead to greater expenditure. This hypothesis views that causality, as in the case of the Philippines, runs from GOVREV to GOVEXP.

POLICY IMPLICATIONS With the result consistent with revenue-spend hypothesis, it implies that government's capacity to spend is critical on the ability of its revenue generating agencies such as Bureau of Internal Revenue (BIR), Bureau of Customs (BOC), and government owned and controlled corporations (for non-tax revenues) to bring in the much needed revenues to finance public expenditures. Efforts to enhance revenue collection and to meet revenue targets will also enable government to improve its fiscal position without compromising public spending. And as revenues improve, fiscal consolidation efforts by government are expected to bear fruit as public expenditures will not warrant additional borrowings thereby improving the country's debt profile. Furthermore, the higher revenue collections will enable government to spend on big ticket items such as infrastructure projects that provide long-term positive effects in the economy.

REFERENCES

Granger Causality Between Philippine Government Expenditures and Revenues and Its Policy Implications

Asian Development Bank (2009). Key Indicators for Asia and the Pacific.

Diokno, B. (2008). The Philippines: Fiscal Behavior in Recent History.

UP School of Economics Discussion Papers, No. 0804.

Eita, J. & Mbazima, D. (2008). The Causal Relationship Between Gov ernment Revenue and Expenditure. University of Namibia, Bank of Namibia.

Elyasi, Y. & Rahimi, M. (2012). The Causality between Government Revenue and Government Expenditure in Iran. International Journal of Economic Sciences and Applied Research (IJESAR), 129145.

Gujarati, D. (2004). Basic Econometrics. New York: McGrawhill Pub li cations.

Miora, C. & Florina, C. (2007) Causality Between Government Reve nues and Expenditures in Romania. European Integration â&#x20AC;&#x201C; New Challenges for the Romanian Economy, p174178.

Moalusi, D. (2004). Causal Link between Government Spending and Revenue: A Case Study of Botswana. Department of Eco nomics, Fordham University.

Taha, R. & Loganathan, N. (2008). Causality Between Tax Revenue and Government Spending in Malaysia. The International Journal of Business and Finance Research, Vol.2 Number 2.

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The Practice of Corporate Social Responsibility of Mining Sector towards Building Community-Based Enterprises: A Literature Review Rulina B. Viloria Professor, San Beda University

JEL Classification: G34, L71, L72, M14, 016 Keywords: Corporate Social Responsibility, Mining, Literature, Natural Resources

INTRODUCTION This study presents a discussion and synthesis of literature and studies about the practice of corporate social responsibility of a business organization, in general, and the mining sector, in particular. Four main themes are reviewed for this study. The discussion of the literature begins with the concept of corporate social responsibility and its related concept, sustainable development.

The second part is concerned with community involvement as a form of corporate social initiative. Part three discusses the community engagement in the mining sector. Finally, how this engagement is examined in building community-based enterprises.

The Concept of Corporate Social Responsibility Over the decades, the concept of corporate social responsibility (CSR) has continued to grow in importance and significance. It has been the subject of considerable debate, commentary, theory building and research. In spite of the ongoing deliberations as to what it means and what it embraces, it has developed and evolved in both academic as well as practitioner communities worldwide (Benn & Bolton, 2011; Pearce & Mans, 2011). The idea that business enterprises have some responsibilities to society beyond that of making profits for the shareholders has been around for centuries. For all practical purposes, however, it is largely a post-World War II phenomenon and actually did not surge in importance until the 1960s and beyond. Therefore, it is largely a product of the past half century.

Brief Historical Account of CSR

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The Practice of Corporate Social Responsibility of Mining Sector towards Building Community-Based Enterprises: A Literature Review

The concept of CSR dates back to Adam Smith’s 1776 opus, The Wealth of Nations, which is considered to be the landmark of modern capitalism. Smith’s proposition states that when business is free to pursue profits and efficiency, it eventually benefits the common good, i.e. it serves both its interests and those of society at best. Milton Friedman’s neo-classical position draws upon Smith’s argument by explaining that profitability is the ultimate social responsibility of business, if done in an ethical way and in obedience to the law. As most known defender of neoclassical view of economics, Friedman defines Social Responsibility completely differently: “There is one and only one social responsibility of business – to use its resources and engage in activities to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition, without deception or fraud” (Friedman, 1962). Until today, this neoclassical view has been the primary paradigm of business concepts.

However, academic literature concerning the responsibilities of corporations largely came to the fore during the 1950’s, with authors such as Bowen (as cited by Hack, et. al., 2014) boldly claiming that as corporations grown and more importantly ‘go global’ so does their use and impact on the planet’s resources. Bowen defined CSR in 1953 – as one of the first – as “…an obligation to pursue policies to make decisions and to follow lines of actions which are compatible with the objectives and values of society” (as cited by Cochran, 2007). It was Bowen who introduced the idea of “social responsibilities” of business people in a wider sphere than pure profit-seeking. The core idea was that business could and should be reasonably expected to serve society in a way that goes beyond its previous obligations.

This is mirrored by Spencer in 1958 (as cited by Hack, et. al., 2014) who over 50 years ago recognized that changes in technology and increase in the size of businesses have altered the managerial role and that their biggest challenge is not making profit, but to create ‘social action.’ Therefore, during the 1950s and 1960s philanthropy, or ‘community service and employee welfare’ were the terms used to categorize CSR activities.

The 1960s and 1970s brought a significant expansion of academic interest in the CSR field. The concept was examined and discussed in depth resulting in the emergence of models of CSR debates on the managerial implications of CSR and introduction of related concepts of Business Ethics and Corporate Social Responsiveness (Carroll, 1999). During this period CSR was described as a businesses’ responsibility towards its stakeholders, namely employees, community, and the environment and in time would become an organization’s competitive advantage. However, Friedman (as cited by Hack, et.al. 2014) stated categorically that the “competitive advantage claim” of CSR is overestimated. Furthermore, he argued that the overall aim of business is to generate profit for shareholders and not partake in activities which divert attention away from doing so. To ensure business and social

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responsibility remained intertwined, Hack. et. al (2014) cited Sethi’s claim that the essence of CSR is how a business delivers profits to stakeholders, and that it must be consistent with ethical standards, law and social expectations. This helps define CSR as a corporate actions which bring business activities in line with the prevailing social norms and values. CSR can therefore also be described as a process where social problems are identified, and corporations anticipate what constitute a desired state of affairs and devise policies that will achieve those outcomes. During 1970’s, CSR was hotly debated an in these discussions gained prominence in the academic and business consciousness, and began to find its feet on the national and international stage.

Moving on to the 1980s and 1990s, the responsibilities attributed to businesses changed and became the concepts of corporate governance and social control of business in society. Businesses were seen to be influential in solving social problems, but it is important to remember that while their stake may go beyond mere ownership, their CSR obligation needed to mirror social interests, not just those of stakeholders/investors.

Social issues are seen as business opportunities.

The 1990s onwards saw an influx of authors attempting to create such opportunities by combining business and society. CSR is where businesses contribute to society and communities in efficient, profitable and socially responsible ways. Similarly, Carroll (1999), as cited by Hack, et.al. (2014) described CSR through a three circle model: the inner circle highlighted functions economics, the intermediate functions are those demonstrating sensitivity to changing values, and the outer circle as the emerging and extra social responsibilities. There are definite legal and economic areas which form the baseline, and any extra, ethical, philanthropic activities are considered to be about ‘going the extra mile.’

Since the 1990s, CSR has been used as ‘the base point’ or integrated as an element of other related concepts.

The CSR journey arrives now at the 21st century where the term ‘stakeholder’ was introduced and used more and more to describe those impacted by individual businesses. Stakeholders include both people and environment (Hopkins, 2003 as cited by Hack, et. al. 2014). Clearer, steadfast definitions emerged and CSR became an entity and an ethical responsible route for business, thus CSR is a way of creating “…higher and higher standards of living, while preserving the profitability of the corporation, for peoples both within and outside the corporation.” (Hopkins, 2003, as cited by Hack, et. al. 2014).

Given the above historical account, the question remains: what does CSR mean precisely? Although the debate on the relationships between business and society, and the implied responsibilities, has been ongoing for decades, there is still no consensus on a commonly accepted definition of CSR (Jones, 1980; Carroll, 1991; McWilliams and Siegel, 2001). This may be partly due to the fact that people within (and outside) the field, notwithstanding the issue of literary translation, employ, promote and defend different interpretations that have emerged over the past

Sustainability: A Related Concept of CSR “Corporate social responsibility” and “sustainability” are two of many terms used to describe the social and environmental contributions and consequences of business activity. The notion of sustainable development lies in progress within three dimensions: economic development, environmental protection and social cohesion. Its princi-

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The Practice of Corporate Social Responsibility of Mining Sector towards Building Community-Based Enterprises: A Literature Review

three decades. These range from Corporate Social Responsibility to Sustainable Development, from Business Ethics to Corporate Social Contract, from Corporate Accountability to Business in Society and from Corporate Citizenship to Corporate Governance. This variety of themes in itself is interesting and demonstrates the richness of the concept itself as well as its criticality of research (Carroll, 1999; Ougaard and Nielsen, 2002). Yet this research area still lacks a ‘common ground’ which is accepted by the majority and a necessary development to assert legitimacy, credibility and value of research on the social and environmental responsibilities of business towards society.

Therefore, a portfolio of concepts expresses society’s expectations as to the role and responsibilities of business, but none of them can actually be labelled as ‘the’ definition of CSR. The concept of CSR by itself is also often put in relation to other concepts such as Corporate Social Responsiveness or Corporate (Social) Performance by academics. On the other hand CSR and/or Sustainable Development are considered central issues by business organizations and civil society’s representatives, with the value of partnerships, i.e., stakeholder’s involvement (Kraus & Britzelmaier, 2012). Definitions of CSR thus range from highly conceptual to very practical or managerial statements (Kakabadse, et.al., 2005).

The evolving CSR agenda is driven by a global shift in the way the role of business is perceived. In the context of globalization and the challenges of sustainable development, business is increasingly seen as a crucial element in the process of social transformation, for the benefit of society in general, as well as business itself.

This global shift is characterized, for instance, by active participation of organizations such as the World Business Council for Sustainable Development (WBCSD) in the sustainability and CSR discussions. WBSCD regards CSR as engine for the social dimension (social progress) which supports companies to fulfil their responsibilities as good citizens and defines CSR as “business commitment to contribute to sustainable economic development, working with employees, their families, the local community, and society at large to improve their quality of life” (WBCSD, 2006). On the other hand, the Commission of European Communities described CSR as a “concept, whereby companies integrate social and environmental concerns into their business operations and interactions with their stakeholders on a voluntary basis” (Commission of the European Communities, 2001).

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ples are described as social progress that recognizes the needs of everyone; effective protection of the environment; prudent use of natural resources; and maintenance of high and stable levels of economic growth and employment. It clearly points out to the ethical concept of the World Commission on Environment and Development, better known as the Brundtland Commission, which is seen as the most common definition of sustainable development as “development which meets the needs of current generations without compromising the ability of future generations to meet their own needs” (as cited by Mebratu, 1998). This definition is often referred to as the triple-bottom-line which represents an economic, ecological and social pillar (Elkington, 1998). Further, it supports strong economic and social development, in particular for people with low standard of living. At the same time it underlines the importance of protecting the natural resource base and the environment. Economic and social well-being cannot be improved with measures that destroy the environment. Intergenerational solidarity is also crucial: all development has to take into account its impact on the opportunities for future generations.

The depletion of natural mineral resources is a major concern in the debate about sustainable development. Jenkins and Yakovleva (2005) stressed the following viewpoints defending the possibility for mineral extraction to be sustainable: (1) depletion of mineral resources should be compensated by “generation of new wealth, which, in the form of useful lasting capital, can benefit present and future generations”; (2) mineral depletion is not an issue for the foreseeable future due to the possibility of recycling many nonfuel metals and minerals; (3) discovery of new mineral deposits, and the advancement of technology for improved recovery of minerals from previously unprofitable deposits.

In the mining industry, progress within the three dimensions of sustainable development could be achieved through economic development – investment of generated revenues to ensure the future development and long term livelihood of the communities; environmental protection – the environmental impact of natural resource exploitation should be minimized and land rehabilitation to allow successive use; and social cohesion – minimization of social cultural disruption to the communities, maintenance of stakeholder dialogue and transparency of operation. Sustainable development in the corporate mining context requires a commitment to continuous environmental and socio-economic improvement, from mineral exploration, through operation, to closure.

On another note, Hudtohan (2009) discussed a similar notion on the relationship of CSR and sustainable development in the Philippine experience. He concludes that business corporations are now facing a different role in responding to challenges posed by dwelling fossil fuel and global warming. He posited that “from a profit producing organization, corporation has evolved into an active participant in doing prophetic work through corporate social responsibility: serve the stakeholders sustain development, save the world”.

Corporate Community Involvement: Social Initiatives Apart from concentrating solely on economic viability, businesses today are expected to give considerable attention to environmental sustainability and social responsibility. While the financial bottom line has been the traditional focus of attention of most business managers today, there are many applicable sets of standards and established procedures for measuring and evaluating environmental bottom line. Nowadays, almost all companies incorporate environmental account in their annual reports. However, the weakest point in the triple bottom line triangle is the social issue which can be considered as synonymous with CSR (Dey & Circar, 2012).

The pressure on firms to be “socially responsible” continuously increases and originates from a range of stakeholder groups, including customers, communities, employees, governments, and shareholders (Kakabadse, et. al. 2005). Walsh, et. al (2003) go so far as to state that “attending to social welfare may soon match economic performance as

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The Practice of Corporate Social Responsibility of Mining Sector towards Building Community-Based Enterprises: A Literature Review

CSR relates to the activities of businesses, particularly in terms of their contribution to achieving economic, social and environmental sustainability. In recent years, concerns about the sustainability and social responsibility of industry have become an increasingly high profile issue in many countries and industries, none more so than the mining industry. The discovery, extraction and processing of mineral resources is widely regarded as one of the most environmentally and socially disruptive activities undertaken by business (Guenther, et. al., 2007). Further, they noted that many of the environmental disasters or human rights incidents that have contributed to the growing public concern about CSR over the last 40 years took place in the mining or petroleum industries; thus the mining industry is a key topic in debates about social and environmental responsibility.

To sum, CSR fits into a long-term perspective and refers to ethical principles that are not necessarily codified by the law. Its rationale may be the existence of a social contract between society and business, whose terms enable society to take back the social power it has granted business with. It can be viewed as a process involving various stakeholder groups, which may be highly contextual in practice, and submitted to macro environmental as much as very personal factors of influence. Not least, CSR tends to be a multidisciplinary rather than distinct management discipline, which ought to be examined. The basic idea to incorporate the sustainability aspect into business management should be grounded in the ethical belief of give and take to maintain a successful company in the long-term. As the company is embedded in a complex system of interdependences in – and outside of the firm, its maintaining character should be fulfilled to the company’s commitment in protecting the environment or reducing its ecological footprint due to the general acceptance of its corporate behaviour.

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a condition for securing resources and legitimacy.” An important and evolving response is the adoption of social initiatives designed to improve the well-being of the communities where the company operates.

These social initiatives are well beyond traditional philanthropic activities. This was the same notion advanced by Hudtohan (2014) with emphasis on CSR moving a notch higher as it evolves in practice as corporate social initiative. Corporations are not simply providing cash donations to other organizations (such as non-government organizations of non-profit organizations) but are directly involved in, and provide significant resources to, their community projects (Hess & Warren, 2008). The nature of these initiatives reflects the growing outlook among stakeholders that “people need help solving their problems, not just money” (Idemudia, 2009) and “beneficiaries themselves need to have a change in mindset from dependency and co-dependency towards developing a sustainable self” (Hudtohan, 2014). Relative to this is the work of Hess, et. al. (2002) who focus on “corporate community involvement”. They label these initiatives “Corporate Social Initiatives” (CSIs), connected to the “core” underlying value of the firm. Munro (2013), however, made a refinement of CSIs, after utilizing Corporate Social Performance by Wood (1991), to simple term as Social Initiatives or SIs. She defined SIs as “activities relating to the needs of: society; the environment; and the community – surrounding the company’s geographical location and market areas.”

Companies undertake social initiatives for the following motives: (1) altruism; (2) enhance corporate reputation or to legitimize business interests; (3) response to pressures from different stakeholders; (4) being true to corporate values; and (5) as integral to their business models and therefore key to viability (Habaradas, 2012). Corollary to this is an empirical evidence of his (Habaradas, 2012) case study of Pilipinas Shell where the primary motive for undertaking philanthropy can shift over time, thus a corresponding change in its philanthropic approach. Its philanthropic activities started with altruistic motives, but were later designed to legitimize its presence in communities in which it operates. At the time the study was conducted, the major social initiatives of Pilipinas Shell were geared towards enhancing stakeholder relations, and addressing its increasing commitment to sustainable business practices.

Implementation of social initiatives requires constructive engagement with civil society, particularly non-government organizations, the community, local government and other stakeholders. This scenario is very much evident among mining companies. Hutchkins, et. al. (2007) were keen to note that mining companies did normally have a social conscience. They posited that “mining companies, by and large, have always cared about communities; it’s just been ‘their’ community: miners and their families. The legacy of mining has to be what we truly leave for the communities and what we do for these communities

There have been many benefits of mining companies doing social initiatives for its stakeholders. Hilson and Banchirigah (2009) in their article related to CSR in Ghana’s mining sector, identified several programs developed by selected mining companies that foster community development. These programs are along the lines of livelihood projects and infrastructure development.

Hubo and Lewis (n.d.) reported that engagement of selected mining companies in the Philippines to its stakeholders and civil society groups brings about the following: (a) significant increase in annual incomes of residents, employee dependents and communities; (b) increased awareness and participation of local groups in company decision-making that affects the livelihood of communities; (c) recognition of workers’ right to organize and to collective bargaining; (d) development of downstream industries as a result of livelihood and skills enhancement training programs; (e) decreasing crime rates due to available employment opportunities; (f) adoption of communitybased resource management approaches; (g) increased environmental awareness; and (h) educational assistance. The case of Pilipinas Shell, as studied by Habaradas (2012), indicates that the company has gained “collateral benefits such as community acceptance, higher staff morale, better relations with transport sector, various awards and recognition.”

Mining and Community Engagement One may be tempted to query how mining companies have managed and implemented their CSR or social initiative activities in order to achieve their core business objectives. The technical, legal and commercial functions which support efficiencies in the extraction of resources are understood as being the core of this business (Kemp & Owen, 2013). It is an appropriate question as mining companies usual operate in socially, environmentally and politically sensitive locations whose inhabitants are often subsisting communities (Danielson, 2006).

Community engagement is defined as any channel of communication purposely set by business organization in order to receive feedback on its activities from external stakeholders particularly. The nature and frequency of this community engagement between the actors is influenced by its project and community needs and demands (Danielson, 2006).

Community engagement as a notion associated with business organizations, but more noticeably with mining corporations, is laden with tensions and challenges. The dynamic landscape which often spouses irreconcilable outcomes of profit accumulation on the one hand, and social concerns pertaining to notions of community and environment on the other, is a test for mining companies. Most mining

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in a sense of engagement, of training, opportunity development and business development”.

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companies which operate in social and environmentally sensitive areas have to navigate the ‘contested terrain’ of CSR agenda-setting which mostly does not agree with their core business ideologies. According to McWilliams et. al., (2006) social initiatives such as embracing community engagement activities are embarked upon on the presumption that economic benefits will be facilitated, if not greatly assisted in businesses’ endeavors. While Ditlev-Simonsen and Midttun (2010) in a study of what motivates managers to pursue corporate responsibility, conclude that branding, stakeholders and value maximization are the key motivators. In a survey of Kepore and Imbun’s (2010) study, their respondents would have preferred sustainability and branding as the key motivators.

Yet the actualization of community engagement in practice is vested in the mining companies’ decision-making areas which is relentlessly guarded against as it does not want to allow control and power.

Although there is a presumption mining companies have ultimate power in determining CSR-related activities, there is an inherent subtle distribution of power where local communities and the governments also influence CSR dimension. This movement for control and power in CSR agenda-setting forms the ‘contested terrain’ of decision-making. But ultimately it is the business organizations which determine the budget and scope of CSR activities (Kepore & Imbun 2010). As Kemp (2009) contends, the scenario of mining companies treating community relations as public relations exercise would change as its domain changes and it would embrace professionalism and thus the strength of community relations as a profession.

As such, mining companies have witnessed the necessity and emergence of community relations and development functions, essentially under the rubric of sustainable development and corporate social responsibility (Buxton, 2012). A powerful pro-social industry discourse replete with terms such as “social license” (Owen & Kemp, 2012; Prno & Slocombe, 2012) ; “benefit sharing” (Zandvliet & Anderson, 2009), “community participation” (International Council on Mining and Metals (ICCM), 2012 ), and “partnership development” (McPhail, 2008) has come to stand as evidence of the value assigned to this emergent function.

Generally speaking, community relations and development provides companies mechanism through which to engage and manage their relationship with key stakeholder groups and protect their business interests (Idemudia, 2009). This function is typically charged with operationalizing sustainable development and CSR policy through strategies of engagement, communication, negotiation, conflict resolution and development programming (Kemp & Owen, 2013; Rees et.al, 2012).

On this basis, it can be argued that the extent to which mining companies value and integrate the community relations and development functions into core business is a direct presentation of their commitment to sustainable development and CSR. Despite widespread claims by industry that CSR as a “core competence”, Kemp & Owen (2013) argued that mining industry has yet to integrate the community relations and de-

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velopment functions as part of core business. In doing this, social development and well-being of communities surrounding the mining operations take place concomitantly.

Business and community, taken together, consists of an interactive system. Each needs the other. Each can influence the other.

They are intertwined so completely that an action taken by one will inevitably affect the other. In the context of mining operations, the boundary line between the two is blurred and indistinct (Ajith, 2014).

As in Papua New Guinea, to a large extent, community interaction, whilst unavoidable, was considered secondary to the technical business of running a mine (Kepore & Imbun, 2010).

Many mining companies now use the language of community development and participation as part of sustainable development and corporate social responsibility frameworks. Community development discourse invokes poverty reduction and human development goals and infers value-based commitments to social justice, equity and inclusion where benefits flow even to the most vulnerable (Kemp, 2009). Community development in mining is being institutionalized and professionalized as evidenced by the appointment of specialist practitioners at operations, policies, projects and programs with a development orientation, and an increased focus on education and capacity building of community practitioners in mining (Manteaw, 2007).

Mining usually brings with it rapid development and significant change, such as opportunities for employment, a large influx of capital and establishment of livelihood or income generating projects. Mining may have potential to have positive development impacts, but companies can inadvertently or carelessly exacerbate an already poor situation for some community members, particularly those with the least resources (Sarin et. al., 2006).

The mining industry tends to use “community development” to describe activities undertaken directly or indirectly with communities in the geographic proximity of operations that aim to achieve positive economic, environmental and/or social outcomes for communities in which operations are located. Some companies also use terms such as “community programs” and “community support”. The sphere of activity varies from site to site, depending on the context, size of the operations, commodity or service, impact of the operation and various social and political expectations. Other activities included under community development tend to include local employment, training and skills development, provision of infrastructures (such as roads, water and sanitation facilities), service delivery (such as health and education), employee volunteerism, donations as well as non-mining related opportunities, such as capacity building and empowerment programs.

Some scholar categorize such activities as corporate community involvement or investment (Muthuri, 2007). For site-level initiatives, the mining industry tends to use community development ostensibly be-

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cause it infers a potential for providing “local” benefits. How these benefits are distributed is another concern.

Benefits distribution is one of the areas that define a successful community development activities of a company. These benefits refer to tangibles and intangibles such as wages and community projects. However, beside this area, behavior (i.e. company policies and employee actions towards local people e.g. respect and caring) and side effects (level of responsibility of a company for broader and long-term impacts of its presence in the community) are also equally important for the following reasons: (1) they help improve economic prospects and social services like direct benefits from employment and indirect benefits from improving quality of life resulting from increased economic activity as well as better health, education and infrastructure; (2) significant presence of a company approach that demonstrates fairness and respect; and (3) company takes responsibility for any negative impacts on people’s lives that result from the corporate presence (Zandvliet and Anderson, 2009).

Local people are usually explicit about their hopes for jobs and social services but begin to express their concerns about respect and caring and side effects only after they have negative experiences. However, for positive experiences, the above seems to become less important. This explains why mining companies can provide many economic benefits and social services and still find themselves in trouble with local communities.

In its attempt to determine whether members of the community are affected by dust pollution and noise disturbance of the operation of the mining company in Motui, North Konawe, the study of Mustafa, et. al. (2015) showed that the presence of the mining company and its operation did not significantly disturb the surrounding community. On a previous study with locale used by Mustafa, et. al., Harun (2012) also revealed that communities were satisfied with the corporate social responsibility practices of PT Bintang-Delapan-Wahana Nickel Mining Company (Pt BDW NMC) in the Sub-District of Routa, adjacent to the District North of Konawe, Indonesia. Earlier on, the relationship of corporations and communities in the Philippines was established by Luz and Montelibano (1993) through their case studies. It was stressed that corporations are indeed playing a significant role in the development of the community life whether this is economic, political and social aspects.

The above revealed a situation that social responsibility and real sustainable development do not reach the communities. Cronje and Chenga (2009) suggested that to deal with this, identifying who takes responsibility for various facets of development must be considered. He stressed the importance of a process approach to corporate social responsibility and development rather than “quick fixes”, and proper community engagement initiatives.

Process is a fundamental element of community development. It seeks to empower individuals and groups of people by providing them with skills they need to effect change within their communities. These

Towards Building Community-Based Enterprises As is well known, the term “enterprise” refers to an activity that produces or aims to produce value that can be expressed in monetary terms, and any individual that is responsible for producing such values is commonly called an entrepreneur (Somerville and McElwee, 2011).

In so doing, economic goal is the primary consideration of an entrepreneur when embarking on such activity (Sarreal, 2013).

Entrepreneurship requires action: creating new products or processes, entering into new markets or creating new ventures. All of these typically involves a different kind of phenomena involving personal initiative. To be an entrepreneur, therefore, is to act on the possibility that one has identified an opportunity worth pursuing (McMullen and Shepherd, 2006).

As the practice of entrepreneurship evolved, Gibson-Graham and Cameron (2007) have seen the proliferation of a range of different kinds of enterprises, notably community enterprises whose ‘core business’ is not to maximize individual nor private benefit but to produce community well-being, particularly for marginalized groups.

The nature of community enterprise, its potential for future growth and its significance for human well-being, are interpreted in various ways. Much depends on what is meant by community itself, but also on what types of enterprise are to be regarded as properly community ones (Somerville and Mcelwee, 2011).

In discussing community enterprise, there is an initial need to define exactly what the term means. Following Schumpeter (1983), Begley and Tan (2001) define entrepreneurship as the unprogrammed, innovative recombination of pre-existing elements of activity. The tra-

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skills are often created through the formation of groups working for a common agenda. As an important aspect in the field of social work, working with people can take on different stages or phases (Buenviaje, 2003). These include the vital processes encountered, thus: (1) preentry phase; (2) entry into the community with immersion/integration phase; (3) organization development; (4) phase over. These same stages or phases are utilized by mining companies within a progressively interrelated phases and include vital processes as its integral parts.

The generic nature and the applicability of the above-mentioned stages/ phases were even discussed by Viloria (2006) in developing an integrated approach to community involvement of an educational institution; Walters and Anagnostopolous (2012) in their exploratory case study on the social responsibility partnership program at the Union of European Football Associations (UEFA); and Pacis (2013) on the initiative of broadcasting sector in the Philippines for CSR literacy program. Similar effort for community development initiatives were undertaken in the mining industry as revealed by the studies of FonesWolf (2011), Hilson and Banchirigah (2009) and Jimena (2007).

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ditional perspective of business formation has been based on the initiative of one or two entrepreneurs (Krishna, 2000). However, this definition emphasizes that entrepreneurship is a process, distinct from the entrepreneur as a person. In defining entrepreneurship as a process, the term is not necessarily limited to individual behaviour and could therefore be applied to a group. Second, a community is defined as “a small basic administrative or statistical area, preferably as homogenous as possible” (Borzaga and Defourny, 2001). Here the term “community” is used to refer to an aggregation of people not just defined by the sharing of goals or the productive activities of the enterprise, but rather by shared geographical location generally accompanied by a collective culture and potentially by other shared relational characteristics (Maldifassi, 2001).

Corrolarily, community is understood here in terms of ‘shared geographical location, generally accompanied by collective culture and/or ethnicity and potentially other shared relational characteristics’ (Peredo & Chrisman, 2006). This implies a commonality and in this light, it may be useful to consider that “community is a sense of spirit and cannot be defined by geography, environment and activity” (Mort et. al., 2003).

In reality, the spirit of commonality of interest may itself transcend geographical boundaries so that in practice, it is the communities themselves that are able to identify themselves through a shared interest.

The idea that members act “together,” “corporately” or “collaboratively” should be understood flexibly. Some members may be more active than others, but most or all will have some role in developing and implementing the entrepreneurial initiative. Most if not all members will participate in some relatively direct way in monitoring and directing the enterprise’s activities. Some will, in addition, be active, ongoing participants in the productive tasks of the enterprise. But virtually all will be committed to a common undertaking, though they are first of all defined as a community by something other than that shared commitment (Torri, 2009).

Given the above, a community enterprise can now be characterized as an enterprise whose social foundation lies in a community of some kind. Community enterprises can also be classified as social enterprises insofar as they are controlled by their members and have social as well as economic aims (Somerville & McElwee, 2011). As London and Morfopolous (2010) have said, they are controlled by people living within their area of benefit (the ‘community’), and their surpluses (if any) are principally invested or used to benefit people within that area (not necessarily the same people).

Paredo and Chrisman (2006) have defined what they call “community-based enterprise” as a community acting corporately as both entrepreneur and enterprise in the pursuit of common good. They further characterized community-based enterprise in which the community is treated as ‘completely endogenous to the enterprise and the entrepreneurial processes, meaning that ‘the community is simultaneously both the enterprise and the entrepreneur. The focus is on ‘local communities, which

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create collective business ventures, and through them or their results, aim to contribute to both local economic and social development.

While there have numerous examples of successful communitybased enterprises, there has been a lack of conceptual clarity about the question of why some are more successful than others. As understood, community-based enterprises are implemented as a means to improve the conditions of communities. But questions remain: what drives community enterprises to have greater social and economic impacts?

What organizational capabilities of community-based enterprises can stimulate successful impacts?

Peredo and Chrisman (2006) have argued that successful community-based enterprises depict certain characteristics. They suggested that the emergence of community-based enterprises is usually characterized by the following: (1) it appears as a response to a social/ economic stress faced by the community; (2) involvement of all members is preliminary to take action; (3) social capital is integral to the formation of community-based enterprises; (4) it is based on available local skills; (5) it has multiplicity of goals: â&#x20AC;&#x2DC;the need to achieved social, economic, environmental and cultural goals simultaneouslyâ&#x20AC;&#x2122;; (6) the project is managed and operated by local people rather than external experts; (7) the community acts as an entrepreneur when its members, acting as owners, managers and employees, collaboratively create or identify a market opportunity and organize themselves in order to respond to it; (8) the size of the community should be sufficient to generate a stock of assets and resources that is optimal allowing the social organization to become an economic organization; and (9) community-based enterprises are owned, managed, and governed by the people rather than by government or some smaller group of individuals on behalf of the people.

Bloom and Chatterji (2009) believed that the extent to which an enterprise can serve more people and improve outcomes more dramatically is influenced by how effective the organization has been at developing capabilities as staffing, communicating, alliance and networking building, lobbying, earnings generation and stimulating market forces.

In a case study conducted by Torri (2009) on the impacts of an Indian enterprise, Gram Mooligai Company (GMCL) on local communities, it was affirmed that an important effect of the participation of the members on GMCL activities has been an increase in income. Further, it was stressed that associating with GMCL has helped its member get better and higher revenue or sales generation because of reduction in transaction costs.

Another interesting key achievement emerged from the case study of GMCL, which can be generalized for other community-based enterprises was the importance of adopting a multi-layered network structure that involves a diversity of stakeholders and partners in a community-based organization. Through this, the enterprise was able to gain specific comparative advantages that allow its performance, sustainability and scalability to be enhanced.

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The case of the jasmine flower growers in coastal Karnataka in India is another example of a successful community-based enterprise (Handy, et. al., 2011). Seen from the program level, it is on-going and uninterrupted for nearly 70 years. It has embodied the principle of sustainability. Since its inception through one local church and its parish, the program grew in scope and has continued to flourish on a daily basis.

Another success of the program was largely based on reliance on available local skills. This particular type of jasmine is endemic to only that part of the country due to soil and weather conditions. All family members, young and old participate in the production process. The skills are passed down from one generation to the next. The project since its inception has been created, operated and managed by local people rather than external experts.

In justifying that community-based enterprises are hybrid organizational forms that combine characteristics of for-profit businesses and community sector organizations, Eversole, et.al. (2013) explored how rural communities may use community-based enterprises or social enterprises to progress local development agendas across both economic and social domains. Drawing on qualitative case studies of three social enterprises in rural North West Tasmania, the authors explored the role of social enterprises, despite differences in size, structure, mission and age, were strongly embedded in their local places and local communities. As deeply contextualized development actors, these social enterprises mobilize multiple resources and assets to achieve a range of local development outcomes, including, but not limited to social capital.

Canares (2013) conducted a study on the interactions, challenges, and opportunities of social and solidarity economy in the Philippines, by looking at a case study of a relatively successful community-based enterprise in the province of Negros Occidental. This enterprise was able to assist more than 300 households, members of 11 different villages in increasing their income through collective production and marketing system. The study argued that community- based enterprises in particular, and social solidarity economy in general, can be successful to an extent by (a) properly matching the earning patterns of people and available resources with market demand; (b) by reducing the transaction costs of farmers in ensuring market and credit access; and (c) by providing a livelihood guarantee to participants.

An Assessment of the Impact of Programs of San Beda College in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province Ricardo B. Deri Rulina B. Viloria Celedonio B. Mendoza Jr. EdilbertoSan B.Beda Viray Jr. University-Department of Economics JEL Classification: D1, D02, D6, D9, R2, Z10, Z13, Z31 Keywords: Impact Assessment, Outreach, INTRODUCTION As a Catholic educational institution, San Beda University has been actively involved in the task of community development and nation building through various community involvement activities initiated by the Institutional Community Involvement Center (ICIC).

The community involvement activities have been developed in accordance with the Mission Statement of the University: To form graduates who are fully human, wholly Christian, truly Filipino and globally competitive. Specific values founded in this Mission include the following: respect for human dignity and human rights, care for the environment, compassion and solidarity with the poor, life of service, life of faith, primacy of the gospel, love of prayer, work and study.

A quick glance at the community involvement activities of the University reveals that in the past several years, the different departments, in coordination with ICIC, offered the following services to the target communities, research, formal and informal education, leadership training, livelihood assistance, social services, legal services, medical assistance and spiritual formation.

The target communities and beneficiaries vary in terms of sectoral representation. These include the urban poor, out-of-school youth, farmers, the sick, the elderly and aged, prisoners, orphans, tribal and fishing communities.

One of the strategies used by the University for a meaningful community involvement is through community organizing/building. This requires that the University has to identify a partner community where capability building and other forms of development will be at work together with the people. This may be in the form of livelihood development, skills development, leadership development, spiritual growth and health improvement.

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BACKGROUND OF THE STUDY Partnership with Pactil. Since 2011, San Beda Univer sity thr ough ICIC, is implementing meaningful community development programs and activities in Pactil, Bauko, Mountain Province. As a partner community of the University and with the participation of its faculty, students, non-teaching personnel and alumni, activities were conducted along the areas of organization building, networking and collaboration with government, private and non-government organizations, capability building, leadership training, spiritual and values formation, educational assistance, social services, livelihood and entrepreneurial capabilities and community research.

The involvement of San Beda University in Pactil dates back in 1960s when a Belgian Sisters and Fr. Pablo Bilog of Pacdal Parish asked some assistance from St. Benedict Crusade in San Beda UniversityManila, for the construction of the chapel. The chapel, named as St. Benedict Chapel, was finally erected in 1967 in Pactil. It was also used a classroom during school days. (Sitio Pactil Profile, ICIC Document).

Since then, the Benedictine monks, headed by Bro. Felipe Bautista, started to visit the place and served as its community and venue for apostolate and immersion.

However, there was a sudden absence of the Benedictine monks in the community in 1990s. In July 2011, a reconnection was successfully implemented by the San Beda University Benedictine Educational Foundation, Inc. (SBUBEFI) and the ICIC. Six years since the start of reconnection, organizations were formed such as St. Bede Mushroom and Vegetable Growers Association (SBMVGA) and the Pactil Youth Organization. Other members of the community who are not part of these organizations were also given assistance by SBU-ICIC and SBUFEFI such as members of Basic Ecclesial Community, Knights of Columbus, Pactil Elementary School and the Barangay Council of Monamon Sur. Table 1 below shows the summary of programs and services extended by ICIC in partnership with SBUBEFI in Pactil from 2011-2017:

PROGRAMS

OBJECTIVES

Health, Advocacy, Leadership Capacity and Spirituality

provide services geared towards the maintenance of good health, sustainable environment, art appreciation, meaningful spiritual values and social justice

PROGRAMS

OBJECTIVES

ACTIVITIES/SERVICES Intensive Seminar on Cross Cultural and Theater Arts for Youth Cultural Dancers Cross Cultural Leadership Seminar Dance Concert: From Rituals to Musical Advent Youth Recollection Legal Aid Clinic Community Enhancement Building Seminar Youth Leadership Training Networking for Collaborative Project in Social Enterprise Review and ratification of Constitution and By-Laws and Organizational Structure Participation in the Launching of the Golden Anniversary Celebration of St. Benedict Chapel

ACTIVITIES/SERVICES Trainorâ&#x20AC;&#x2122;s Training in Mushroom Growing

Livelihood

To enhance and Seminar on Advanced Mushstrengthen the liveliroom Production hood and income generating capacities of the Business Clinic Program members of the com- (Microfinance, cooperative, cost munity accounting, quality control, sales and marketing, production management, product marketing, mathematics, investment) To provide training Trade Fair programs for the transSeminar on Soap Making fer of technical entrepreneurial skills to the Basic Printing Course conducted

by Integrated Basic Education members of the comDepartment munity

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Table 1. Summary of Activities/Services Provided for Sitio Pactil 2011-2017

126 PROGRAMS

OBJECTIVES

ACTIVITIES/SERVICES

Deri, R. B., Mendoza, C. B., Viray, E. B., & Viloria, R. B.

Reconnection Visit and Community Dialogue Community survey on the Impact To gather data for the purpose of program plan- on Livelihood and Educational ning.

Ocular Inspection for SEED 2014, 2015 and 2016 and Preliminary Participation in SEED 2014, 2015 & 2016

Community Research

Sportsfest Faculty Research on the Impact of SBU Program in Sitio Pactil To perform periodic review and evaluation of Research on Health Determinants, programs and projects in Beliefs and Practices of Kankathe community. nayes of Bauko, Mt. Province

Project Monitoring through Participatory Situational Analysis

PROGRAMS

OBJECTIVES

ACTIVITIES/SERVICES Donation of computer sets to SBMVGA and Pactil Cultural

Other Services

Service Personnel Community Involvement Activity (Guidance and Counselling, Storytelling, To respond to immediate Reading Comprehension, Tutorial and specific needs of the Services and Seminar on Basic members of the commuMicrosoft Excel Seminar nity through a wide variChristmas Gift-giving ety of volunteer work Medical and surgical mission Kinder to 12 orientation Donation of Drum Set to Holy Family Catholic Mission from

Education

OBJECTIVES

ACTIVITIES/SERVICES

To provide non-formal venues of education for Scholarship Aptitude Exams and children, out-of-school TESDA Networking youth and adults in the community.

To assist parents from the community in meetTraining on Basic Computer ing the education needs Literacy and Computer Servicing of their children

In its sixth year of working in the area, ICIC deemed it necessary to stop for a while and assess the programs and services implemented. It is expected that at this stage, the community people have already been aware of the progressive nature of their working relationship with San Beda University through ICIC. It is in this light that this research was conducted to determine the impact of SBU-ICIC programs to the living condition of the community members. Specifically, it aims to: 1. Develop an updated socio-cultural characteristics or profile of the members of the project holders in Pactil; 2. Assess the programs of SBU-ICIC in terms of the respondents’ skills development, livelihood capability and spiritual growth; 3. Investigate the influence of socio-cultural attributes to the respondents’ skills development, livelihood capability and cultural growth; 4. Identify possible areas for re-designing the ICIC programs in Pactil; and 5. Present and validate the interpretation of the data to the community people and ICIC’s partner organizations such as SBUBEFI and LGU of Bauko.

CONCEPTUAL FRAMEWORK

Today, it is no longer sufficient for educational institutions to stick to their traditional functions of instruction and research, Institutions of higher learning are now called upon to perform a third and equally important function, that of community extension. This challenges universities and colleges to come down to extend, reach out, to share or to learn and relate with people of the community for which they a part. Intellectual education, accumulated information and aca-

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PROGRAMS

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demic excellence are empty and meaningless if not extended to the marginalized. Educational institutions must involve themselves in meeting the needs of the community by putting their professional and technical expertise at the people’s disposal. Indeed, it is a major function of education to widen the options available in the solution of community problems and the improvement of the quality of life of the people in the community. This is especially true and necessary if the people are located in developing countries of the world (Pangilinan, 1997).

To fully realize the above, one of the basic considerations used by Institutional CIC of San Beda University is to draw a line between the so called “community service” and “community development”.

Community service refers to a wide range of volunteer work done in the community (Grey et.al, 1999). Further, this involves short-ranged activities aimed at responding to the specific needs of a community or beneficiaries (Manalili, 1990). Medical mission, gift-giving and relief goods distribution are examples. Community development, on the other hand, is a model of community organizing/building, the essence of which is people’s participation. It is a participation that harnesses and strengthens the people’s capacities to determine and realize the development agenda of their own communities at various levels. Participation must give people a voice in development and management decisions, access to resources, the knowledge required for development and a share in the benefits achieved (Buenviaje, 2003; Ewalt, et. al., 1999). Therefore, it involves a dynamic interplay of the community people and the community development worker. These dynamics happen in the context of an institution, as represented by the community development worker, adopting or in partnership with a particular community.

San Beda University’s experience in in working with its partner communities revealed the presence of interdependence of the two. Students, faculty, administrators and service personnel mostly initiate community service activities. In addition, they are actively involved in community development work with their partner/adopted communities. Given this, the University accepts the fact that in most occasions it has to render community services with its partner communities especially during times of disaster and calamities. In other words, the separation of community service and community development is difficult because the two are intertwining community involvement tasks. Therefore, the Institutional CIC made use of the concept of community development process in the formulation of its programs and activities, while at the same time providing community services most especially to its partner/adopted communities and institutions (government and private), hospitals/clinics, prisons, parishes and other sectors.

The Process as a Fundamental Element of Community Development As mentioned earlier, community development is a function of a dynamic interplay between the community people and the community development worker. The former, popularly known as the stakeholders,

Figure 1. Community Development Process and Its Interrelated Phases

These are: (1) Pre-entry Phase. Since community development is entering into a development partnership with the community people, it requires basic considerations and preparations. Basic considerations include: (a) acceptability of an institution and/pr community development worker to the community; (b) resources to engage in community building â&#x20AC;&#x201C; human and material. Social investigation is an indispensable aspect of this phase. It is a process of gathering, analyzing and utilizing pertinent data about the community. A community profile is a documentary output of social investigation consisting of the description of the community and analysis of community situation. (2) Entry Into the Community with Immersion/Integration Phase. Establishing a friendly yet purposeful relationship starts upon entry of the community development worker into the community. It entails leveling of expectations and clarification of purpose and reciprocal roles of community people and the community development worker (Buenviaje, 2003; Manalili, 2013). The aim is to get the communityâ&#x20AC;&#x2122;s sanction and commitment to engage in a partnership with the institution for participatory development. Immersion and integration with the people refer to the basic continuing effort by which the community development worker becomes one with the community people by integrating him/herself in the community life. This is a germination process of building trust and cooperation networks now commonly called building the social capital ((Putnam, R. 1993). (3) Organizational Development. This signals that the community people and communi-

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have different interests in development. The latter is the partner of the people in development. S/he acts as a catalyst for participatory development. The community development worker could be a single person or a team of development workers usually attached to the institutions.

Working with people in the community can take on different stages or phases. These include the vital processes encountered (Manalili, 2013). Figure 1 presents the various steps within a progressively interrelated phases and include vital processes as its integral parts.

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ty development worker are already prepared to work together as partners in development.

The aim is to enhance the capacities of the community people to, become self-determined and socially formation responsible. Together, they undertake the formation or strengthening, expansion and consolidation of people-centered organization/s and evolve community-managed development programs/projects (Manalili, 2013). The community development worker begins to contribute his/her catalyzing efforts of engaging the community people in a shared leadership, participatory decisionmaking, scientific and discerning problem-solving, creative conflict management and resource development. (4) Phase Over. From the very start during the leveling of expectations done upon entry and consistently demonstrated all throughout the succeeding phases, the community people have already been aware of the progressive nature of their working relationship with the community development worker. Hence, this phase enables the community people to achieve a gradually unfolding leap or advancement in their higher level of consciousness, of commitment to, and competency in participatory development. It is important that during this phase and even prior to this, the community people and the community development worker stop for a while and assess the programs and projects implemented. Thus, monitoring and evaluation is a leaning tool for awareness creation which can be done by the program/project implementers themselves or the outsiders (Buenviaje, 2003).

RESEARCH METHODOLOGY In view of the purpose for the study, the research design utilized for the study is descriptive. The study is carried out in Sitio Pactil, Barangay Monamon Sur. The population for the study comprise all the participating social entrepreneurs in the San Beda-Manilaâ&#x20AC;&#x2122;s Institutional Community Involvement Center program.

A sample size of 29 entrepreneurs who are members of St. Bede Mushroom and Vegetable Growers Association was drawn from the study population through purposive and simple random sampling procedure. The instrument for data collection is a questionnaire which had a Cronbach Alpha reliability coefficient of 0.994. The questionnaire was structured into three sections A, B and C. Section A required the sociodemographic profile of the respondentsâ&#x20AC;&#x2122; while section B, had 10 items structured to elicit information from the respondentsâ&#x20AC;&#x2122; on their participation, views and opinions about organizations and how the SBU has been able to influence the capability development of these enterprises. Lastly, section C had five (5) items each in three (3) dimensions namely skills development, livelihood development and spiritual development.

The response format is on a five-point Likert Scale with options of SA- Strongly Agreed, A- Agreed, N-Neutral, D- Disagree, and SDStrongly Disagreed. Data collected from the study is analyzed using descriptive and inferential statistical tools which include frequency table,

DATA PRESENTATION AND ANALYSIS The following are the results of the survey. The first part presents the socio-demographic profile of the respondents. Lastly, data is presented as to the assessment of the respondents on how SBU-ICIC programs have significantly affected their skills development, livelihood development and spiritual development. The first and second parts are presented vis-a-viv the average daily income earned by the respondents.

Age Group. The major ity of the r espondents (34.5% ) ar e 50 years old and above. This is followed by respondents whose ages range from 40-49 for which 27.6% belong. There are 7 (24.1%) respondents for age bracket 30-39. Only about 13.8% of the respondents are below 30 years old. Generally, the age distribution implies mature individuals who are members of the livelihood organizations.

Looking at the income levels received by the respondents on a daily basis, 23 of them are earning Php200 and below. A minimal number of 3 respondents are earning an average daily income of Php301 and above.

Gender. The major ity of the r espondents ar e women (96.6%) and only one among the 29 respondents is male. These women are members of the livelihood project in the area organized by SBU -ICIC. Besides being vegetable growers themselves, it can be implied that their membership is brought about by their active participation in community meetings and activities. This is normal in a rural setting where females are mostly the ones who actively participate into these community activities because the male member of the household is usually busy making a living for the household.

Household Size. The r esults r eveals that major ity of the r espondents (55.2%) have household size of about 5-7 members. This is followed by 7 of the respondents or 24.1% whose household size has 2 -4 members. It can be implied that the communityâ&#x20AC;&#x2122;s normal household size (5-7 members) is not an ideal Filipino household size.

Source of Income. The r esults shows that far ming is the major source of income of the respondents, registering 19 or 65.5% of the responses. This is followed by 6 responses or 20.7% of the respondents for which their teaching and potato chips making are their main sources of income. No one among the respondents is into livestock as a source of income. This can be attributed by the topographical condition (specially climate is not conducive) of the area which may not be suitable for livestock farming.

Sufficiency of Income. When r espondents ar e asked whether they feel sufficient or not with the income that they receive, the re-

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percentages and OLS regression. The Statistical Package for Social Scientist (SPSS) and GRETL are used to analyze the data collected.

All hypotheses were tested at 0.05 significant Level.

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sults reveals that majority of the respondents (21 out of 29 or 72.4%) answered that there is sufficiency of income. This may be accounted for by the very simple lifestyle that respondents are practicing. For them, it is sufficient that basic needs such as food and education are addressed and not such luxury in the household or family exists.

Ranking of Spending Priorities (Top One Only). Twenty seven (27) or 90% of the respondents said that spending for basic needs ranked as their top priority. Basic needs include food, clothing and shelter. Food for them is very essential and they make sure that there is food served on the table for the family. Clothing, on the other hand is also essential for which there is adequate clothing that will keep them warm from the cold weather in the area.

The other areas for spending priorities (health services, community contribution, livelihood and education/training) received a very minimal response. This indicates their inability to give a portion of their income to spend for these items. For example, they will not at all risk spending for livelihood training unless this training is given for free.

Membership in Organizations. The r esults r eveals that the top three organizations for which the respondents are active members are the following: Saint Bede Mushroom and Vegetable Growers Association (SBMVGA); and Pactil Women’s Group and Basic Ecclesial Community (BEC). The data on membership received multiple responses from the respondents. There are respondents who are members of SBMVGA while at the same time members also of Pactil’s Women’s Group and BEC. This indicates that respondents are not confined into just one organization but they can still be actively involved in other organizations in the community whether this is for cultural or religious group.

SKILLS DEVELOPMENT On Skills Development and Age. Given the attributes from 1 to 5, almost 75.86% of the entire respondents answered “Strongly Agree” in all aspect but, the age bracket 30-39 recognizably replied “Agree”. In this area, this is considered as the “early adulthood” ideally this age bracket are the group that is open, willing and able to learn more especially when it comes to their current status in life. With this, it is important for the organizer to identify the age brackets that will appreciate and openly accepts the program that will hasten progress and nourish their skills that will be applicable in all the aspects of their life.

On Skills Development and Income. Given all the five (5) attributes, 89.66% responded “Strongly Agree” wherein they all believed that skills development offered by the program are all significant in helping them develop their skills in farming, exercise their civil rights and helps them to be firm in their decision-making, opening their minds to the growing potentials of agri-business, enhance their skills to adapt to the political, economic, social, technological and environmental challenges and improve the quality of their life. And only, less than 9% answered “agree” and “neutral” which is almost insignificant.

LIVELIHOOD DEVELOPMENT

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On Livelihood Development and Age. With all the attributes from 1 to 5, the age bracket 30-39 still considerably as a critical group wherein they replied “agree” in all questions as compare to the entire age brackets were they all reacted “strongly agree” in all aspects.

When it comes to the livelihood development, especially on answering the questions like “the program enables us to earn additional income” and “explore more opportunities for income and improve the communities livelihood” the age group 30-39 answered a distinguish “agree”.

This might be the stage of contemplating the issues of unemployment and psychosocial risks according to Australian-New Zealand Psychiatry. In this stage, they are exposed to unemployment concern and had small but pervasive effects on psychosocial outcomes.

On Livelihood Development and Income. With all the five (5) attributes, same with the skills development, almost everybody responded “strongly agree” wherein they all deemed that livelihood development program offered to them has a magnitude in improving their earning capabilities, exploring more opportunities for income generation, advancing their families and community’s livelihood and providing them to alternative source of living.

SPIRITUAL DEVELOPMENT On Spiritual Development and Age. Again, given the attributes from 1 to 5, still the age bracket 30-39 showed its difference from other age brackets by answering “agree” in all aspects as compare to the “strongly agree” remarks by the majority of the respondents. In spiritual discussion, the researchers consider millennial issue arising in this stage which clearly explains the answer “agree” of the 30-39 age brackets. According to the website Lucky Attitude, UK study on Millennial Characteristics, they describe them as “non-religious,” wherein they had no religion nor attended a place of worship, other than for a wedding or a funeral. They also thought that religion is the cause of evil in the world more often than good.

Spiritual Development vs Income. Given all the five (5) attributes, majority of the respondents replied “strongly agree” that spiritual development offered was very much significant as almost all of them approved that the program strengthen their relationship with God, family and community, how they perceived life in a positive way and living life with a purpose. In addition, respondents easily accept the presence of spiritual development in the program because they obviously considered their traditions and ethnic orientation in believing by the power of nature and God in providing all their blessings, like a better harvest and more food in the table.

4

200 & BELOW

17.4

17.4

% Share

0

2

0

201250

33.3

0

66.7

0

% Share

1

1

1

0

301 & ABOVE

34.8

30.4

17.4

17.4

% Share

29

10

8

7

4

TOTAL

1

0.345

0.276

0.241

0.138

% Share

AVERAGE DAILY INCOME LEVELS (in pesos)

Below 30 4

30.4

1

1

% Share

30 – 39 7

34.8

3

251300

40 – 49 8

1

96.6

above 50

3

28

0

0

1

100

23

3

Total

100

95.7

3

22

3.4

FEMALE

1

0

0

4.3

0

1

0

MALE

1

Deri, R. B., Mendoza, C. B., Viray, E. B., & Viloria, R. B.

Age Bracket

Gender

3

1

1

29

23

1

Total

3

Table 7.1. Sociodemographic Profile

134

6 23

7 & above

Total

17.4

8.7 1

2 23

OTHERS

Total

0

73.9

4

17

1

0.261

0.522

BUS ENT

LIVESTOCK

FARMING

12

5 to 7

0.217

% Share

3

2

1

201250

3

1

2

1

33.3

0

0

66.7

1

0

0.667

0.333

% Share

0

251300

0

% Share

3

2

1

301 & ABOVE

3

3

0

0

0

1

100

1

0

0.667

0.333

% Share

AVERAGE DAILY INCOME LEVELS (in pesos)

29

6

16

7

29

6

4

0

19

TOTAL

1

20.7

13.8

0

65.5

1

0.207

0.552

0.241

% Share

An Assessment of the Impact of Programs of San Beda University in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province

Source of Income

Household Size

5

2 to 4

200 & BELOW

Table 7.2. Sociodemographic Profile

135

Not Sufficient

Sufficient

23

5

18

200 & BELOW

0.913

1

21.7

78.3

% Share

3

3

1

2

201250

0

1

1

33.3

66.7

% Share

2

1

301 & ABOVE

66.7

33.3

% Share

8

21

TOTAL

27.6

72.4

% Share

AVERAGE DAILY INCOME LEVELS (in pesos)

Total 21

0.043

0

0

3

3

0

0

0.25

0

0.75

1

0

0

2

1

27

29

0

0

0.067

0.033

0.9

1

Deri, R. B., Mendoza, C. B., Viray, E. B., & Viloria, R. B.

0

0

1

Livelihood

0

% Share

Basic Needs

1

0.043

251300

Health Service

1

Educ.& Training

0

Commty Con

Table 7.3. Sociodemographic Profile

Sufficiency of Income

Ranking of Spending Priorities (Top Only)

136

Membership in Organizations

21 8 3

4 2 5

PAC WG

PYO

PCD

K of C

BEC

0.116

0.047

0.093

0.07

0.186

0.488

% Share

1

1

1

2

201250

0.2

0.2

0

0

0.2

0.4

% Share

251300

% Share

3

2

2

301 & ABOVE

0.429

0

0

0

0.286

0.286

% Share

AVERAGE DAILY INCOME LEVELS (in pesos)

9

3

4

3

11

25

TOTAL

0.164

0.055

0.073

0.055

0.2

0.455

% Share

An Assessment of the Impact of Programs of San Beda University in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province

SBMVGA

200 & BELOW

Table 7.4. Sociodemographic Profile

137

(SA)

4.60

(SA)

4.6

(SA)

4.65

(SA)

4.55

Below 30

(A)

3.99

(A)

4.09

(A)

3.91

(A)

3.97

30 - 39

(SA)

4.36

(SA)

4.38

(SA)

4.33

(SA)

4.38

40 - 49

(SA)

4.67

(SA)

4.72

(SA)

4.68

(SA)

4.62

Above 50

(SA)

4.46

(SA)

4.39

(SA)

4.39

Grand Total

Weighted Mean and Verbal Interpretation

Table 13. Skills, Livelihood, and Spiritual Development versus Age

Statements

Skills Development vs. Age

Livelihood Development versus Age

Spiritual Development versus Age

TOTAL

Source: Survey administered by the Researcher

Deri, R. B., Mendoza, C. B., Viray, E. B., & Viloria, R. B.

*Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Neutral (N); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

138

201-250 3.57 (A) 3.33

(N) 3.67 (A) 3.52

(A)

200 & below 4.52 (SA) 4.54

(SA) 4.57 (SA) 4.54

(SA)

(SA)

4.29

(SA)

4.33

(SA)

4.33

(SA)

4.22

301 & above

(SA)

4.46

(SA)

4.39

(SA)

4.39

Grand Total

An Assessment of the Impact of Programs of San Beda University in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province

Source: Survey administered by the Researcher *Note: 0 Not Applicable (N/A); 0.1-1.7 Strongly Disagree (SD); 1.8-2.5 Disagree (D); 2.6-3.3 Neutral (N); 3.4-4.1 Agree (A); 4.2-5 Strongly Agree (SA)

TOTAL

Spiritual Development versus Income

Livelihood Development versus Income

Skills Development versus Income

Statements

Weighted Mean and Verbal Interpretation

Table 13. Skills, Livelihood, and Spiritual Development versus Income

139

Live

Skills

Constant

0.160

−0.152

−0.005

0.915

Joined in Organiation

Model 1

0.679

0.160

−0.152

−0.005

0.915

Available SBU Prgram

Model 2

0.000000581

0.679

−0.160

0.152

0.005

1.085

Program Achievement Goal

Model 3

Table 14. Results from Regression Analysis

Spirit

0.679

0.000000581

Estimation of Parameters

Adjusted R-squared

0.000000581

P-value(F)

Deri, R. B., Mendoza, C. B., Viray, E. B., & Viloria, R. B.

Spiritual development and Livelihood development are statistically significant. This shows that the presence of religious organization is seen as a reason to join any active organization existing in the community. Thus, the probability of joining these organizations increases as they view religious organization as a means in developing a livelihood organization.

140

4.03977 0 −0.857955 −0.818182 0.875 2.67614

−10.2841 4.55114 −0.863636 6.73295 −5.99432

0.268849 0.107023

SKILLS DEVELOPMENT 1

SKILLS DEVELOPMENT 2

SKILLS DEVELOPMENT 3

SKILLS DEVELOPMENT 4

SKILLS DEVELOPMENT 5

LIVELIHOOD 1

LIVELIHOOD 2

LIVELIHOOD 3

LIVELIHOOD 4

LIVELIHOOD 5

SPIRITUALITY 2

Adjusted R-squared

P-value(F)

An Assessment of the Impact of Programs of San Beda University in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province

Omitted due to exact collinearity: Q24SPIRITUALITY1 Q26SPIRITUALITY3 Q27SPIRITUALITY4 Q28SPIRITUALITY5 1: OLS,

3.89773

Model 4 Joined in Organization

Const

Estimation of Parameters

Table 15. Results from Regression Analysis

141

142

FINDINGS AND IMPRESSIONS:

Deri, R. B., Mendoza, C. B., Viray, E. B., & Viloria, R. B.

1. Impact on spiritual development is strong followed by livelihood development. It is noteworthy that skills development has weak impact for the respondents. The cultural background of the respondents from Sitio Pactil of being â&#x20AC;&#x153;mahiyainâ&#x20AC;? and low selfconfidence should also be considered.

2. The impact of the other aspects of community life were not sufficiently addressed (social, health, political, etc.) for lack of data or non-inclusion in the questionnaire. Limited data were taken from the community during the entry phase since initial visit were focused on reconnection (spiritual dimension) and later on livelihood. For example, a comprehensive community profile could have been done in the beginning phase of the community organizing work by ICIC to be able to establish impact in terms of socioeconomic status of the community. Another profiling could have been done together with this study to really determine changes or development in the socio-economic status.

3. A more holistic approach to community development must be in place requiring a well-articulated plan of programs and actions including measurable expected change or improvement in the socio-economic status of the community. While there is a 6 year development plan, there was no quantifiable indicators stipulated.

4. Close monitoring of the implementation of the programs and plans of the people in the organization must be established so that any problems or difficulties that may arise can be immediately or easily addressed or worked-out. This can be realistically done if there is a social worker assigned from the local government unit of Bauko to closely monitor the programs and plan of the organization.

REFERENCES Buenviaje, O.I. (2003). The Heart of Community Organizing: A Mono graph Christenson, J.A, and Robinson, J.W, (1989) Community Development in Perspective. Iowa State University Press.

Ewalt, P.L.; Freeman, E.M.; Poole, D. (1999). Community Building: Renewal, Well-Being and Shared Responsibility. Journal of Community Practice (6), 97-98.

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An Assessment of the Impact of Programs of San Beda University in Holy Family Catholic Mission in Pactil, Bauko, Mountain Province

Gray, M.J.; Ondaatje, E.H. and Zakaras, L. (1999). Combining Service and Learning in Higher Education: Summary Report. Santa Monica: RAND. Manalili, A.G. (1990). Community Organizing for People Empowerment. Kapatiran-Kaunlaran Foundation. ________________(2013). Ang Proseso ng Pag-oorganisa ng Pamayanan na Mula sa Tao Para sa Tao. Daluyan: Journal ng Wikang Filipino, (19,1).

Pangilinan, D.H. (1997). Community Outreach Programs of the Mendiola Consortium Schools: An Assessment. SCIENTIA, San Beda University.

Putnam, R. D. (1993). The Prosperous Community. The American Prospect, 4(13), 35-42.

Rothman, J. and Tropman J.E. (1989). Models of Community Organization and Macro Perspectives: Their Mixing and Phasing [in F.M. Cox, et.al (eds), Strategies of Community Organization: Macro Practice]. Itasca, IL: F.E. Peacock Publishers.

Sidney, G. and Noble. L.G. (eds). (1998). Organizing for Democracy.

Ateneo de Manila Press, Loyola Heights, Quezon City.

Siegmann, H. (2003). Capacity Development â&#x20AC;&#x201C; Capacities for Sustainable Development [in Thiel, R.E. (ed), Development and Cooperation] June, Vol. 30, No. 6, Germany.

Sirianni, C. and Firedland L. (1995). Learning and Capacity Building from the 1960s to the 1990s. Civic Practices Network.

An Assessment of the Level of Readiness of the Tourism Industry of Japan and Philippines in Relation to the Commencement of AEC 2015 A Research Collaboration between San Beda University-Manila and Kobe University-Japan JEL Classification: L8, L9, Z31, Z32, Z38, Z39 Keywords: Tourism, Japan, The Philippines, Security, Infrastructure, Industry, ASEAN

INTRODUCTION ASEAN Economic Community 2015. The ASEAN Economic Community (AEC) is a highly valuable yet ambitious policy goal, aiming at a single market and production base that is a region of equitable development and is competitive internationally and fully integrated to the global economy. Scheduled to form in 2015, it is expected to make ASEAN more dynamic and competitive with new mechanisms and measures to strengthen the implementation of its existing economic initiatives; accelerating regional integration in the priority sectors; facilitating movement of business persons, skilled labour and talents; and strengthening the institutional mechanisms of ASEAN (AEC Blueprint, 2008). Thailand, Singapore, Malaysia, Indonesia, Vietnam, Cambodia, Laos, Myanmar, Brunei and the Philippines plan to drop trade tariffs between them to zero and liberalize investment sectors, enabling the free flow of goods, services, capital and skilled labour across the regional bloc (delMundo, 2013).

The AEC is the realization of the end goal of economic integration as espoused in the Vision 2020, which is based on a convergence of interests of ASEAN Member Countries to deepen and broaden economic integration through existing and new initiatives with clear timelines. In establishing the AEC, ASEAN shall act in accordance to the principles of an open, outwardlooking, inclusive, and market-driven economy consistent with multilateral rules as well as adherence to rules-based systems for effective compliance and implementation of economic commitments (Runckel, 2012).

The motto of ASEAN, â&#x20AC;&#x153;One Vision, One Identity, One Communityâ&#x20AC;? as seen in their unity to attain the goals and the purposes of the association: These aims and purposes were about cooperation in the economic, social, cultural, technical, educational and other fields, and in the promotion of regional peace

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An Assessment of the Level of Readiness of the Tourism Industry of Japan and Philippines in Relation to the Commencement of AEC 2015

and stability through abiding respect for justice and the rule of law and adherence to the principles of the United Nations Charter (ASEAN, 2012).

Travel and Tourism. With the advent of the AEC in 2015, growth in the travel and tourism (T & t) industry will be increasingly moved forward. One of the benefits of the AEC is the tourism opportunity. Asians travel more in the region and there are more travellers from other countries that have begun to reach out to Asia as new visitors. The trends were evident at the recent Hub City Forum, held by the Pacific Asia Tourism Association (PATA), where more than 100 travel industry executives discussed the tourism potential, government's spending to upgrade facilities both for leisure attractions (Runckel, 2012).

The T& t sector has become an important driver of growth and prosperity for many countries. It contributes to development by creating jobs and enterprises through direct activities and backward linkages, provides additional incentives for infrastructure development, and earns foreign exchange revenues. It is estimated that the T& t sector accounts for about 9 percent of GDP and employment worldwide (The ASEAN Travel & Tourism Competitiveness Report, 2012).

Yet, despite its economic weight and the many benefits it provides, numerous obstacles hinder its development, including in countries of the ASEAN plus three cooperationâ&#x20AC;&#x2122;s, namely: Japan, China and South Korea nations. Using a descriptive type of study, this research will examine and explore those obstacles, as well as the enablers of development for Japan and Philippines to assess the level of readiness of the tourism industry of both countries in relation to the commencement of ASEAN Economic Community in 2015.

Tourism is one of the fastest growing industries in the world today. People all over the globe are more anxious, more enthusiastic and more willing to spend on travelling. Thus, the global tourism industry has accumulated extravagant economic contributions evident in many countries in the world today. According to an article entitled, Economic Success of Tourism by Mechthild Kuellmer, every year billions of dollars are paid to key individuals such as tour operators, hotel and lodging providers, and restaurateurs; in return satisfaction is generated among the millions of tourists who travel each year. As a result, this industry has maintained its distinction as one of the worldâ&#x20AC;&#x2122;s most important sectors of economic development, both for developing and developed countries (Mechthild Kuellmer, 2007).

Philippine Tourism. Tour ism has also shown its r esiliency in face of major political, health, and economic upheavals. Destinations with strong tourism industry are able to bounce back after a major setback. In the Philippines, tourism is a major economic contributor to its economy. It is an archipelagic country composed of 7,107 islands. It offers a rich biodiversity with its tropical rain forests, mountains, beaches, coral reefs, islands, and diverse range of flora and fau-

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146

na, making it as one of the mega diverse countries in the world. Even in the face of consistent negative political and economic events in the past decades, the industry is able to perpetuate and become a major business and employment provider for many Filipinos (Libosada, 2010).

Tropical countries like the Philippines, with a lot of small islands, have a lot to offer to tourists without the need of huge sums of investments. But to further stimulate the tourism, investments are needed in the infrastructure. Especially facilities are needed in the ports where the arrivals of the tourists are. In the specific tourist locations the water and electricity supply should be sufficient. Of course the accommodations in the places where the tourists want to stay have to be adjusted to the wishes of the different tourists. All these facilities should be developed in a sufficient way. Especially investments are needed to have good accessible ports, power stations, communication infrastructure, industrial zones, road network, sanitation standards, and internet access. All these factors improve the tourism experience by providing easier travel, drinking water and better communication.

Japan’s Tourism. J apan National Tour ism Or ganization estimated in August 2013 that about eight million foreign people visit Japan every year. Japan is a nation filled with all sorts of images of ancient traditions, beautiful landscapes and fascinating culture. Although Japan’s past is rich in events and interesting history, today’s Japan is just as fascinating with cutting edge technology and wonderful architecture, while still maintaining the country’s tradition. A living paradox of unparalleled complexity and fascination, Japan is a land of innovation and ancient tradition where Shrines compete against the glittering towers of the modern age.

Likewise, the aim of Japan in merging with ASEAN is to revitalize investment and tourism from their country to ASEAN through organization of exhibitions of ASEAN products, seminars, and workshops, dispatch and invitation of missions, publication and information service, among others (Nakajima, 2011).

OBJECTVES OF THE STUDY The study aims to assess the level of readiness of the tourism industry of Japan and Philippines in relation to the commencement of ASEAN Economic Community 2015; specifically: 1.)

To identify the level of English proficiency of Japan and Philippines.

2.)

To determine whether the two countries can assure the security of their tourists.

3.)

To assess whether the infrastructures are adequate enough to

REVIEW OF RELATED LITERATURE. Free Flow of Services.

Free flow of trade in services is one of the important elements in realising ASEAN Economic Community, where there will be substantially no restriction to ASEAN services suppliers in providing services and in establishing companies across national borders within the region, subject to domestic regulations. Liberalisation of services has been carried out through rounds of negotiation mainly under the Coordinating Committee on Services. Negotiation of some specific services sectors such as financial services and air transport are carried out by their respective Ministerial bodies. In liberalising services, there should be no back-loading of commitments, and pre-agreed flexibility shall be accorded to all ASEAN Member Countries.

In evaluating the quality, servicing, policy, and strategy of investment promotion agencies (IPAs), the Philippines obtained a quite respectable score of 71 percent. The firms rated government agencies` investment facilitation and promotion activities as satisfactory. They cited bureaucracy and slow processing of permits as most problematic issues affecting their operations. They also pointed out the lack of transparency in guidelines and procedures, corruption, and the no uniformity of investment incentives given by the major IPAs. Meanwhile, according to IPAs, the most problematic procedures that investors face in establishing business are permits from local government units (LGUs), environmental compliance certificate from the DENR-Mines and Geosciences Bureau, and visa from the Bureau of Immigration.

To reduce the gap between policy and implementation and boost the country`s competitiveness, the paper suggests the unification and centralization of the investment promotion and facilitation efforts by all IPAs under one agency. It is also necessary to strengthen the current efforts of the Philippine Investment Promotion Plan (PIPP) interagency committee to coordinate the various IPAs` actions and plans. To improve the operational environment and investment climate, IPAs should closely collaborate with national agencies and LGUs particularly in the automation and streamlining of business procedures. Currently, the DTI and the DILG are intensifying their efforts to improve the business permit and licensing system. PEZA`s experience in effectively streamlining its procedures is also worth emulating.

To face the challenges and take advantage of the opportunities arising from AEC 2015, the reforms suggested above must be accompanied by substantial increases in infrastructure investment particularly in power and logistics to reduce the cost of doing business in the country. Modern and efficient air, land, and sea infrastructure should

An Assessment of the Level of Readiness of the Tourism Industry of Japan and Philippines in Relation to the Commencement of AEC 2015

cater the needs of the tourists.

147

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148

be built fast enough. A comprehensive review of the constitutional limitations on foreign equity particularly the 60-40 rule should also be pursued.

THE PHILIPPINES Language Proficiency. In an article in betterphils.blogspot.com, the Philippines remain as the 5th largest English speaking country in the world. It stated that the Philippine Universities produce no less than 500,000 English speaking graduates each year.

It also said that the Philippinesâ&#x20AC;&#x2122; English accent is the most preferred by the western countries since it is neutral and more comprehendible, and the Filipino tongue is flexible and can easily adapt to the western accent. Since the Philippines have sustained their high rank in English proficiency, a group of professionals are drafting a petition for the exclusion of the Philippines from taking any English examination as a requirement for Filipinos to migrate to other English countries.

In an article in Yahoo news, it stated that Global English has released its annual Business English Index (BEI), the only index that measures business English proficiency in the workplace.

The results show that the Philippines is the only country who achieved a score higher than 7.0 which is considered a high proficiency.

Improved economy could be one of the reasons for the rank of the Philippines. English is the universal language and with that, English is used in many business conducted. Other countries with struggling economies garnered a lower score, this places them at a disadvantage when competing at a global scale.

Security. A safe and secured environment is an important factor in fostering investment and economic growth. The Philippine Development Plan 2011-2016 recognizes this and as such, identified crime incident reduction as one of the strategies to promote and sustain public order and internal stability. However, the recent spate of robberies in the metropolis and other high profile crimes have cast a shadow over the countryâ&#x20AC;&#x2122;s peace and order situation.

In the Philippines, the Revised Penal Code (Republic Act No. 3815) serves as the basic law that defines criminal offenses and provides the penalties for the commission of such. For statistical purposes and to create a standardized definition of crime classification, crime is further divided into index and non-index crimes. Index crimes, as defined by the Philippine National Police (PNP), involve crimes against persons such as murder, homicide, physical injury and rape, and crimes against property such as robbery, theft, car napping/carjacking and cattle rustling. Non-index crimes, on the other hand, are violations of special laws such as illegal logging or local ordinances.

Table 1 shows the Overall Crime and Safety Situation data here in the Philippines. It can be seen that there was a steady drop in crime rates from 108 per 100,000 people in 2002 to 69 in 2007. It slightly

Table 1. Crime Volume and Crime Rate per 100,000 Population,

Year

Crime Volume

Crime Rate

Index Crimes

Non-Index

2002

85,776

108

54.6

52.4

2003

83,704

103

52.1

50.1

2004

77,253

93

51.1

41.4

2005

76,758

91

51.6

38.4

2006

71,227

83

47.8

34.1

2007

60,215

69

41.8

32.6

2008

66,846

75

40.4

33.5

2009

502,665

552

327.1

217.9

2010

324,083

350

218.0

208.0

2011

246,958

251

159.8

91.3

2012

217,812

227

134.8

92.4

Crimes

tions and lapses while formulating a uniform procedure for the PNP to report and collect crime data across all agencies involved in the Criminal Justice System and use the same as working basis for policies and programs on various anti-criminality measures. In the previous years, car napping/carjacking and cattle rustling were not part of Crimes Against Property in addition to robbery and theft which are included in the new reporting system implemented in 2009 and requiring all police units to submit the Unit Crime Periodic Report (UCPER) to the PNP National Headquarters for consolidation into the National Crime Reporting System (NCRS).

In 2010, the average monthly crime rate was 28.2. This means that for every 100,000 people, there were around 28 incidents of crime every month. This declined in 2011 to 20.9 and was further reduced to 18.9 in 2012 (Figure 1).

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An Assessment of the Level of Readiness of the Tourism Industry of Japan and Philippines in Relation to the Commencement of AEC 2015

increased the following year to 75 but took a large jump to 552 in 2009, due to changes in the crime reporting system of the PNP. The crime reporting system was changed to correct dysfunc-

San Beda University-Manila & Kobe University-Japan

150

It must be noted though that while there was a decrease in (national) overall crime incidence, crime volume in the National Capital Region (NCR) has increased from 2011 to 2012 by 10 percent. In 2012, the average monthly crime rate in the NCR is 38.6, a substantial increase from 32.8 in 2011 and 28.2 in 2010 (Table 2).

Table 2. Average Monthly Crime Rate by Region, 2010-2012 Region

2010

2011

2012

Region

2010

2011

2012

1

26.08

16.32

21.01

9

42.88

19.6

19.59

2

21.32

10.97

9.27

10

34.86

29.56

22.89

3

44.46

28.83

17.8

11

38.6

29.63

24.29

4-A

20.04

15.86

12.66

12

22.66

19.06

14.38

4-B

18.24

9.49

7.38

13

20.75

16.63

12.81

5

24.33

16.94

14.94

ARMM

2.76

2.03

2.06

6

21.33

9.96

8.79

CAR

76.12

37

53.74

7

40.42

28.85

24.15

NCR

28.15

32.83

38.57

8

10.35

14.02

8.65

Source: Philippine National Police

Table 3. Police-to-Population Ratio in Selected Asian Countries (as of 2012) Country

Ratio

Source

Singapore

1:142

www.singstat.gov.sg

Hong Kong

1:193

www.police.gov.hk; www.censtatd.gov.hk

Malaysia

1:267

http://refsa.org

Thailand

1:304

www.interpol.int

Indonesia

1:428

www.prb.org

Japan

1:433

www.npa.go.jp; www.ipss.go.jp

Philippines

1:651

PNP Chief Directorial Staff Office

Given this, police presence across the archipelago is being intensified through community support, tourism, and other interventions to fight and prevent crime. A program called Pulis Nyo Po sa Barangay (PnpSB) deploys 31,596 policemen to supervise almost 40,000 barangays nationwide; 1,715 policemen are also manning tourism assistance centers and desks all over the country.

There are many ways of curbing, if not totally eliminating crime. The main solution is to increase police presence and visibility especially in crime hot spots. Increasing the police population should also mean producing more quality graduates from the police academy who shall maintain peace and order and ensure public safety and internal security. Strengthening PNP accountability mechanisms should also ensure good conduct among the ranks of policemen. Finally, the cooperation of local government units and civil society groups is also a key in eliminating crime through the implementation of community programs such as the improvement of street lighting to reduce the prevalence and incidence of crime in dark alleys and roads, conduct of awareness seminars, and promoting crime prevention by way of developing neighbourhood watch programs.

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Police visibility. The police are the first line of defense against crime. It has been concluded that crime will be reduced if the number of police will be increased. The PNP has targeted a 1:700 police-topopulation ratio in 2010; 1:600 in 2020; and 1:500 in 2030.3 The actual police-to-population ratio for 2010 was registered at 1:662, better than the target. With the hiring of additional police officers, the ratio has further improved to 1:620 as of March 2013.4 However, the Philippines still fares poorly compared to its Asian neighbors (Table 3).

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Infrastructure. In the Philippines Tourism is a major industry.

They receive over 900 million tourists every year. Tourism is a major source of jobs and consumer spending, according to the National Statics Office (NSO), in their survey entitled 2009 Annual Survey of the Philippine Business and Industry (ASPBI).

In terms of Transport, Storage, and Communications for all establishments the Philippines had a total of 4,181 establishments engaged in Transport, Storage and Communications sector for all employment sizes.

Activities of other transport agencies industry topped the sector with 1,185 establishments or 28.3 percent. This was followed by Activities of tour and travel agencies and tour operators; tourist assistance activities, not elsewhere classified and Land transport operation industries with 983 establishments (23.5%) and 823 establishments (19.7%), respectively.

Figure 2 shows the percent distribution of establishments by industry group.

In terms of Hotels and Restaurants for all establishments recorded a total of 14,998 Hotel and Restaurant establishments in the Philippines.

As shown in Figure 3, Restaurants, bars, canteens and other drinking and eating places garnered the highest number of establishments at 13,348 or 89.0 percent. Hotels, camping sites and other provisions of short-stay accommodation comprised the remaining number of establishments with 1,650 or 11.0 percent.

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Passenger ship, the most common water transport facilities used in 2009, was accounted for 147 units or 42.7 percent of the total water transport facilities. This was followed by other water transport facilities and Ferry with 23.3 percent and 17.2 percent, respectively.

Almost all (97.4%) of the total 193 units of air transport facilities were operated by Domestic air passenger and freight transport (I62101)/International air passenger and freight transport and Nonscheduled air transport. Of the total air transport facilities, 178 units or 92.2 percent were airplanes.

An Assessment of the Level of Readiness of the Tourism Industry of Japan and Philippines in Relation to the Commencement of AEC 2015

In terms of transportation about 5,319 units or 42.2 percent of the total land transport facilities owned and operated by the establishments were cars/sedans. More than half of this or 3,285 cars/sedans were utilized in Public utility cars and taxicabs operation industry.

Distribution of land transport facilities is shown in Figure 4.

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JAPAN Language Proficiency. In an article in J apan today, it was said that Japan ranked 22nd out of 54 countries in Education First (EF) Global English Proficiency Index.

It said that the scores in Tokyo and the Kanto region are higher than other areas of the country. An explanation to this is likely due to the greater concentration of national business operations and opportunities to use the English language.

As is with education, women garnered a larger score than their male counterparts. It is also seen that the young people are more proficient in English and the trait is gradually reducing for middle-aged and older people.

It showed that once the people leave school, it becomes difficult for them to enhance this skill themselves. This is quite in contrast with China whose English proficiency grows steadily from the early 30s.

EF Education First Japan President Sang-Chul Lee said that even though Japan has ranked high in other international tests like mathematics, their English is still relatively weak.

In an article in The Diplomat, it asks the question why English is tough in Japan. The article said that the problem with English proficiency in Japan is not the subject itself but rather the cultural barriers. As the article puts, Japanese culture and etiquette does not do an excellent job in â&#x20AC;&#x153;groomingâ&#x20AC;? people to become confident in communicating in English.

The article also proposed that the students be given a bigger opportunity in using what they learned in a more practical way. Their curriculum only consists of teaching the students to pass tests. They do not learn the necessary skills in using the English language effectively.

Security. As described by Bayley (1976), during the period from 1960s to early 1990s, the crime rate in Japan remained stable and at a low level, with the number of recorded penal code crimes being in the proximity of 1.5 million cases per year. In 1991 however, this situation changed, with the number of recorded penal code crimes rising above 1.7 million for the first time, and then climbing above 2 million in 1998. The financial crisis was followed by another increase in crime, with penal code crimes peaking at approximately 2.85 million in 2002, which was the highest number ever recorded. Overall, the increase in the crime rate during the 5-year period between 1998 and 2002 was a startling 40.3 %.

The latter figure is especially sobering when it is compared with the 5.5% rate of increase observed during the 5 years that immediately preceded this period.

Prevention of crime that threatens the daily lives of citizens.

The first category contains three sub-categories: restoration of social bonds and building safe communities (19 measures), distribution of products and systems effective for crime prevention (15 measures), and protection of crime victims (8 measures).

Source:NPA

Reinforcement of border controls. The major action taken in the first sub-category has been a crackdown on contraband and stolen vehicle trade at the borders. This has been done through the enhancement of cooperation among law enforcement authorities such as the police, the customs agency, and the maritime safety agency (Figure 6).

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The major actions taken in the first sub-category involved support for voluntarily crime prevention activities conducted by community members, development of private security entities, and promotion of crime-resistant designs for roads, parks, and parking lots. Additionally steps were taken to strengthen Koban-based activities that bring the police into contact the community (e.g., community policing, problem-oriented policing, etc.). Action taken in this category also included promotion of the type of crime-resistant product design and environment that is based on the situational crime prevention theory (Clarke1992). These actions brought significant results. The number of volunteer crime prevention groups active in Japan increased from 3,056 in 2003 to 40,538 in 2008. In addition, the number of people participating in these programs was 2.34 million in 2007, as compared with only 0.18 million in 2003.

Furthermore, the number of private houses or business facilities equipped with security alarm systems increased from 1,164,542 in 2002 to 2,115,380 in 2008; an increase of about one million over the course of six years (Figure 5).

Figure 5: The Number of private security guards and alarm systems

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Figure 6. Drugs, firearms, and stolen vehicles seized by customs

Source: Ministry of Finance

Prevention of illegal entry and overstaying of visas. The second sub-category contains measures that enact strict immigration control and effective deportation of illegal foreign residents, as well as the promotion of assistance for legal foreign residents such as employment services and education in cooperation with communities (Figure 7).

Figure 7. The number of deportees and foreign nationals rejected entry

Source: Ministry of Justice

Figure 8. Percentage of foreign nationals among arrestees in Japan

Source: NPA

Enhancement of cooperation with foreign authorities. The third sub-category focuses on enhancement of cooperation with foreign law enforcement authorities through the conclusion of the Mutual Legal Assistance Treaty (MLAT). Coordination with authorities in Mainland China has been especially strengthened.

Development of fundamentals for public safety. The major steps taken in the fifth category include various measures aimed at increasing public safety. They include an increase in the number of law enforcement officers, the introduction of new border control systems, such as a biological identification system, and an expansion of prisons.

Infrastructure. As travel and tourism accounts for 7 per cent of GDP in Japan, it is clear that tourism plays an important role in the revitalization of Japan. Japan saw revenue from international tourism increase by 37 percent in 2012, a higher number than the vast majority of countries.

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Strengthening the investigation of crimes committed by foreign nationals. As can be observed in figure 8, the percentage of foreign nationals involved in criminal activity such as robbery and burglary is rather high. The percentage of foreign nationals in all arrestees charged in penal code crimes is about 2.0% and this number has remained relatively stable. On the other hand, the percentage of foreign nationals among all arrestees charged in cases involving robbery or burglary is quite a bit higher. Therefore, the police have shifted resources to address the problem of crime committed by foreign nationals.

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Part of that upsurge reflects a recovery from the rapid and massive drop in tourism following the earthquake, tsunami and radiation fears in 2011, but it also supports the understanding that Japan is still an untapped tourist destination. Developing a larger tourist market can contribute to a healthy, diversified economy and serve as one source of economic vitality. Japan has not yet developed its tourist market fully, but given the ongoing economic depression, it should be considered more seriously as an important industry.

In terms of Hotel the average nationwide occupancy rate of major registered hotels in FY 2008 was 71.9%. Also, the percentage of major registered hotels and hostels that recorded deficits was 53.3% and 49.7% respectively. Compared with the previous year, the figures increased by 23.4 points and 14.8 points respectively.

In terms of transportation Japan is very easy to get around and it is usually not necessary to have a car. Many of Japan's larger cities provide efficient networks for public transportation. These are all connected by Shinkansen there are only two large airports in Tokyo. Narita International Airport, which was formerly known as the New Tokyo International Airport, mostly handles international flights. This airport sits in Narita city, which is located in the Chiba Prefecture. It is the point of arrival for most of the foreign visitors that come to Japan. There are two terminals, both of which are connected to central Tokyo with a network of bus and rail lines. Tokyo's other airport, Haneda, is actually more centrallylocated. It handles more of Tokyo's domestic flights. Only a few international flights come through Haneda.

It is very convenient for visitors to travel around Japan on train, especially with the low cost of the Japan Rail Pass. Over seventy percent of the railway network in Japan is under the operation of the Japan Railways. The other thirty percent belongs to private companies. The Japan Railways Group used to be the Japanese National Railways, but was privatized after sustaining huge debts due to mismanagement. It is composed of six railway companies that cater to regional passengers. These railway companies are JR East, JR Hokkaido, JR West, JR Kyushu, JR Shikoku, JR Central, and JR Freight, a nationwide freight company.

They combine to create a network of regional, interregional, and urban night trains, Shinkansen (Japanese bullet trains), and train lines across the nation.

Kosoku (highway buses) are inexpensive alternatives to riding trains across Japan. Although bus trips take longer than train trips, the fares are generally much cheaper. This is especially true of buses that run along the more competitive routes. Discount fares can be extremely cheap. Japan Bus Pass is the best discount offer for rock bottom fares to locations across the nation. A heavy network of overnight and daytime bus lines covers Japan. There are one or more bus companies that serve every larger city or prefecture. There is much competition for bus business on the routes to Tokyo and other popular routes.

METHODOLOGY The research methodology needed in the analysis of the level of readiness of the tourism industry of Japan and Philippines in relation to the commencement of ASEAN Economic Community 2015 were adopted to meet the area of evaluation of this study. As the area of study is wide, statistical data, information from other researches and government information is beneficial to arrive at a conclusion that will achieve the objectives of the research. Hence, the analysis of the research tools (e.g. from periodicals, books, thesis, government documents, and official statistics) has been employed. Furthermore, a descriptive research design was utilized in order to describe variables used in this study such as a.)

The level of English proficiency of Japan and Philippines; b.) The level of preparedness of Japan and Philippines in terms of safety and security of the tourists; lastly, c.) The level of readiness of Japan and Philippines in terms of infrastructure.

Secondary data were gathered for this study such as: (1) the English language proficiency through studying the literacy rate of Japan and Philippines, (2) the English language speaking proficiency survey, (3) the visitor arrivals of the Philippines and Japan, (4) Accommodation Capacity Survey, (5) Crime Volume and Crime Rate, (6) Rail, Water, Land and Air Transportation Statistics and (7) Statistics on Information Infrastructure.

DISCUSSION OF RESULTS Language Proficiency. The people of J apan and the Philippines are at either sides of a line. The Philippines ranks the highest among surveyed conducted concerning English proficiency. The Japanese however did not do as well. They ranked as being only moderately proficient in the English language.

In hind sight, the Filipinos think that speaking English gives them a boost in the world, thinking they have the upper hand when speaking a foreignerâ&#x20AC;&#x2122;s language. Filipinos live in a third world country; they know that they have to be extraordinary to get out of their situation.

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Since the nation of Japan is a collection of many thousand islands, it is natural that the country hosts a complex domestic ferry network. Hokkaido, Kyushu, Honshu, and Shikoku are connected by tunnels and bridges, but ferries are still an interesting choice. Many of the smaller islands are only reachable by ship. The larger ferries carry not only people but also cargo and vehicles. These large ferries usually transport hundreds of people and cars and offer a variety of amenities.

These include restaurants and public baths. Some of them are almost luxury liners. However, shorter routes use smaller ships that can just carry a few cars and tens of passengers. In Japan you will find a wide choice of transportation options suitable for any budget.

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Some Filipinos are not proud of what they are and opt to become someone else. But this is not always the case; other Filipinos have a high proficiency in English because they are competitive. These people learn the language for their betterment. This is so that other people may understand them and so, may be able to engage in a conversation with them.

The Japanese people ranked only as moderately proficient in the English language. The tests used in checking for English proficiency is a written exam. Experts believe that the results may even change if it was an oral exam that tested their proficiency. The very nature of the Japanese people is what may be hindering them to achieve a higher English proficiency. The practical uses of the English language are lost in the essence of being a Japanese citizen.

In preparation for the ASEAN Economic Community 2015, given the empirical data of the survey tests of different organizations, the Philippines will be able to accommodate more tourists in terms of communicating with them in the universal language â&#x20AC;&#x201C; English, than the Japanese people Security. Basing fr om the data collected of the safety measures being applied by the Philippines, it can be seen that although the average monthly crime rate from 44.9% to 18.9%, showing that crime has lessened, it is not enough since the crime volume in 2009 up to 2012 is higher compared to the years 2002 to 2008 where it the crime volume has not reached the 100,000 mark. The highest crime rate recorded in the Philippines is in the Cordillera Administrative Region. Although it can be noted that in some regions, the crime rate has lessened except for NCR and Region 1 where the crime rate increased; The police of the Philippines has a ratio of 1:651 thus it is part of the legislative efforts of the government to modernize the PNP where they try to lessen crime and to have a well-trained and pro-active police force in the society. The Crime solution efficiency of the Philippine Police shows that the PNP have solved crime at a 36.67% crime solution efficiency rate though this is not enough.

Japanâ&#x20AC;&#x2122;s crime rate is better compared to other countries, showing that it has 0.34% homicide compared to other countries. It can be seen that the Japanese people feel positively about their safety in the country and that the number of foreign criminals in the country has lessened in recent years.

Infrastructure Land infrastructure. As one of the vital components for the growth of the economy of a country, land infrastructure easily connects one place from another that creates trade. It also helpful in the growth of the tourism, because for the tourist to visit that place he or she will consider if that tourist spot is accessible and one way to know if it is accessible is the availability of the road in that place.

In Philippines, land infrastructure is very essential because it creates investment and job, which help the country to reduce poverty and to

CONCLUSION Language Proficiency. In pr epar ation for the ASEAN Economic Community 2015, given the empirical data of the survey tests of different organizations, the Philippines will be able to accommodate more tourists in terms of communicating with them in the universal language – English, than the Japanese people Security. Cur r ently, the Philippines cannot assur e the safety of the tourists as the PNP’s numbers are too small compared to the population. The crime rate of the country is high as the crime volume reached 200,000. Meanwhile, Japan is considered one of the safest countries, where it is a project of the government to include the community in its efforts to ensure a crime-free society. The APCCS is the project that ensured the safety of tourists in the country as the efforts of volunteer groups and the Japan National Police Agency work together in the efforts of crime-resistance.

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have economic growth. The Department of public works and highways (DPWH) is the government agency responsible for the improvement of the roads and bridges in the country. The Total Road Network in the country in 2011 has a total of 220,000 Km from Luzon to Mindanao.

The Government of the Philippines allocated 889 billion pesos to the development of the land infrastructure in the country, which includes roads, rail roads, airports, seaports, and bridges.

In Japan, the Ministry of Land, Infrastructure, and Transportation (MLIT) is the one responsible for the improvement of the infrastructure in the country. The Total Road Network in the country in 2001 has a total of 1,717,647 Km from Hokkaido to Kyushu. The government of Japan will allocate 6 Trillion yen for the development of the country’s infrastructure.

Maritime Infrastructure. According to the data gathered, the Philippines have ranked lowest among those who have well-developed Maritime Infrastructure out of the other ASEAN countries due to the lack of developed ports, quality ships and questionable safety.

As for Japan, it was shown that it has one of the best developed Maritime Infrastructure with a very extensive transportation system.

Air Infrastructure. The summarization of the shows that the Philippine Air-Infrastructure is at its lowest in terms of the quality of service that the airport is giving and the basic essentials that the Airport should be providing. The Philippines also lack the initiation investing on new and modern equipment, construction of new terminals, and affordable air fares.

With Japan’s advance technology it’s no doubt that they also have good ports, considering they have so many terminals they still maintain each and everything.

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Infrastructure Land Infrastructure. According on the data collected, the Philippines and Japan in terms of land infrastructure. Philippines have a great distance to go in the total road network to be ranked to Japan. One of the reasons why the road network in the Philippines did not increase because the DPWH focuses more on the Barangay roads instead on the National Road which give more impact to the countryâ&#x20AC;&#x2122;s growth and tourism. Even the country allocated large amount of money for the development of the land infrastructure, the overall quality of roads did not improve. And because of lock of improvement on national road the traffic in the country is becoming more congested resulting to the decline of the economic growth and tourism.

In Japan, the road network is impressive covering and connecting almost all the place in Japan. And they are planning to accelerate measures against the aging infrastructure, and reinforce preliminary disaster prevention measures against the Great Earthquake along the Nankai Trough. Furthermore, the Government will focus on intensive development of transportation network systems in order to strengthen competitiveness through realization of smooth transportation toward economic revitalization. And because of the proper allocation of budget and the careful planning in the country the land infrastructure is on its peak, thus attracting more tourist to go to their country, primarily because even the remote or the farthest area are accessible for the tourist. However, with a population of 127 million people primarily located in coastal cities, it is not surprising that traffic congestion is a major issue in Japan.

As a result the study concludes that the Philippines are not adequate enough to cater the needs of the tourist in terms of land infrastructure. And in Japan the study concludes that the country is adequate to cater the needs of the tourist in terms of land infrastructure.

Maritime Infrastructure. The study concludes that, in terms of Maritime Infrastructure, the Philippines is not yet ready to cater the needs of tourists this coming Asean Economic Community Integration this coming 2015 in comparison to Japan. Even though the country has a lot of potential, seeing as that it is archipelagic in nature, a lot of its ports are not well maintained, there arenâ&#x20AC;&#x2122;t enough quality ships and, lastly, safety is still rather questionable.

As for Japan, the study concludes that they are more than ready to serve tourists with their superb ports and transportation systems, however, they may have potential adversaries like Singapore, a member of the AEC, who have an impressive maritime infrastructure as well.

Air Infrastructure. The study concludes that the Philippines is not Airport ready to accommodate all the individuals that will be coming starting the AEC 2015 whilst Japan considering the quality of their airport can accommodate otherwise.

2013 BEI Summary of Results by Country. [Online image] (2014). Re trieved May 13, 2014 from http://cdn.static-economist.com/ sites/default/files/imagecache/fullwidth/images/2013/04/blogs/ johnson/ge.png EF English Efficiency Index. [Online image] Retrieved May 13, 2014 from http://www.ef.com/epi/?mc=we Koichi. How Japan Compares With The World In English Proficiency.

(14 April, 2011) Retrieved May 13, 2014 from http:// www.tofugu.com/2011/04/14/japan-englishproficiency-worldcomparison/ Philippines top English Proficiency survey. Retrieved May 13, 2014 from http://philippines.ucanews.com/2012/05/03/philippinestops-english- proficiencysurvey/ Proficiency chart. [Online image] (14 April, 2011) Retrieved May 13, 2014 from http://www.tofugu.com/wp-content/ up loads/2011/04/ pro ficiency-chart.png TOEFL: Singapore Third Worldwide In English Proficiency Test, Top In Asia [Online Image] (April 28, 2011) Retrieved May 13, 2014 from http:// www.asianscientist.com/academia/toeflsingapore-worldwide- engl ishproficiency-top-asia/ Association of Southeast Asian Nations, (2008). ASEAN economic commu nity blueprint. Retrieved from http://www.asean.org/ ar chive/5187-10.pdf) Ford, P.D. & Snyder, J. (2012, February 20). Philippines 2012 Crime and Safety Report. Retrieved from https://www.osac.gov/ pages/ ContentReportDetails.aspx?cid=12026 Senate of the Philippines. (2012, June). Crime statistics at a glance. Re trieved from http://www.senate.gov.ph/publications/AAG% 20201305%20%20Crime%20Statistics.pdf Police Policy Research Center National Police Academy. (n.d.). Crime in Japan. Retrieved from http://www.npa.go.jp/english/seisaku/ Crime_in_Japan_in_2010.pdf Kanayama, T. (n.d.). Rising crime and crime reduction strategies in 21st century Japan. Retrieved from http://www.npa.go.jp/ english/ seisa ku Ring_Crime_and_Crime_Reduction_Strategies_in_21_Century_J apan.pdf

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