Philippine Development Plan 2023-2028

2.1 Reading System, Enhanced Grade 3 56.0 63.4 66.2 68.90 71.7 74.40 77.2 Basic Education (2018) Information System Grade 6 17.7 32.9 40.2 47.6 54.9 62.2 69.5 (2018) Grade 10 36.4 43.2 49.2 55.2 61.2 67.2 73.2 (2018) Grade 12 24.0 34.0 39.0 44.0 49.0 54.0 59.0 (2018)

2.2 Mathematics Grade 3 27.1 36.0 42.0 48.0 54.0 60.0 66.0 (2018) Grade 6 17.6 31.4 38.4 45.4 52.4 59.4 66.4 (2018) Grade 10 13.1 30.4 38.4 46.3 54.1 61.8 69.6 (2018) Grade 12 2.8 18.0 23.0 28.0 33.0 38.0 43.0 (2018) Chapter 2 Promote Human and Social Development | 55 BASELINE ANNUAL PLAN TARGETS MEANS OF RESPONSIBLE AGENCY/ INDICATOR (2021) 2023 2024 2025 2026 2027 2028 VERIFICATION INTER-AGENCY BODY 3. Participation 16.0 23.0 28.0 33.0 43.0 53.0 63.0 Early CHildhood Care ECCD Council Rate of 0–4.11 (2018) and Development Years Old in *2018 has the (ECCD) Information Early Learning highest encoding System, Programs (%) rate by local National Child government units Development Center (LGUs); succeeding Enrollment Tracking years have lower and Information submission rates System, National ECCD Monitoring Evaluation and Accountability System (will be fully utilized during the 2nd term of the Philippine Development Plan) 4. Licensure examination passing rate

4.1 Licensure examination for teachers (LET) (%) LET results Commission on Higher Education (CHED),

4.1.1 Elementary 52.36 54 56 58 60 62 64 Professional Regulation Commission (PRC)

4.1.2 Secondary 51.13 53 55 57 59 61 63

4.2 Licensure examination across all disciplines (%) Licensure CHED, PRC examination results

4.2.1 Overall 38.8 40 42 44 46 48 50 takers (2019)

4.2.2 First-time 57 59 61 63 65 67 69 takers (2019) 5. Global competitiveness of Philippine higher education institutions (HEI)

5.1 Number 21 22 24 25 27 28 30 Quacquarelli CHED of HEIs in Symonds Asia reputable rankings, Times international Higher Education, rankings World University increased Rankings, Impact Ranking, or other ranking systems identified by CHED 6. Technical 92 92 92.5 93 93.5 94 94.5 TESDA Management TESDA Education Information System and Skills Development Authority (TESDA) Certification Rate (%) 56 | Philippine Development Plan 2023-2028 Subchapter 2.3 Establish Livable Communities By 2028, livable communities are established and support the AmBisyon Natin 2040 aspiration of Filipinos for a strongly rooted, comfortable, and secure life. Establishing livable communities aims to upgrade and plan human settlements in a way that offers equitable, inclusive, and resilient opportunities for the improvement of human well-being while contributing to the economic vitality of the community.36 Pursuing livable communities will adopt an integrated use of space that will bring people closer to work, recreation, and transit options. This will improve the quality of life and attract businesses, making these areas economic centers, whether they are urban or rural. Assessment and Challenges This assessment focuses on representative Civil society representation in local special elements of livability—social development, bodies needs to be improved. Only about community participation, resilience, 50 percent of barangays have civil society environmental quality, and housing. organization (CSO) representation in the barangay development councils. Moreover, COVID-19 impeded delivery of social only 14,000 barangay-based non-government development services and adversely affected organizations (NGO) were accredited. livelihoods of poor communities. The Some LGUs have not fully implemented COVID-19 pandemic exacerbated pre-existing the Department of the Interior and Local issues of poverty and inequality. These include Government (DILG) Memorandum Circular challenges in access to basic services (health, 2021-054 on the creation of their CSO desks education, food and nutrition, and water and and people’s councils, which are mechanisms sanitation), employment, livelihood, transport to encourage more community participation and accessibility, security of tenure and housing in local governance. spaces, and access to open and green spaces. Delivery of health, nutrition, education, social Mixed progress in building community protection, basic infrastructure, and other social resilience. The Philippines is among the most services was slowed down by the pandemic. vulnerable countries to disasters, ranking Although this impacted all sectors of the first in the 2022 World Risk Index39 and 34th population, the poor were disproportionately among 191 in the 2023 INFORM risk index.40 affected.37 (See Subchapters 2.1, 2.2, and 3.2 and Disasters and climate change already affect Chapters 4, 5, and 13) poor communities and are likely to do so more severely in the future without the proper Lack of income opportunities and reduction of policies in place. Although substantial progress pay were pre-existing challenges faced by poor was made with respect to the coverage of the communities. However, these had worsened population by early warning information significantly due to the pandemic.38 through local governments or national Chapter 2 Promote Human and Social Development | 57 dissemination mechanisms, the number of Several policies and initiatives have been deaths attributed to disasters remain high implemented in recent years considering at 12.51 per 100,000 population in 2020 and the growing waste problem. The National 52.69 in 2021. The number of people whose Solid Waste Management Commission dwellings were destroyed by disasters reached adopted resolutions banning the use of plastic 355,070 in 2020, which is almost two times products (i.e., softdrink straws and plastic greater than that of 2018. stirrers) in government offices. At the height of the COVID-19 pandemic, DENR issued Capacity constraints at the local level guidelines for waste generators (e.g., health continue to impede effective solid and care facilities and LGUs), transporters, and hazardous waste management. In 2022, 1,171 treatment facilities on managing highly out of 1,592 municipalities and cities had an infectious wastes. The Department of Science approved 10-year Solid Waste Management and Technology has also been proactively (SWM) Plan, as reported by the Department of generating scientific information on the Environment and Natural Resources (DENR), economic and life cycle of specific single-use and around 31641 LGUs adopted ordinances plastic vis-à-vis alternatives to help in crafting that regulate single-use plastic. However, the responsive policies. The Extended Producer implementation of these plans and policies has Responsibility (EPR) Act, National Plan of been hampered by the absence of dedicated Action on Marine Litter, and the Philippine environment and natural resource officers Action Plan for Sustainable Consumption in LGUs and limited technical and financial and Production likewise offer promising capacity to establish and maintain treatment, opportunities for the country to reduce waste storage, and disposal facilities. In 2021, DENR and facilitate the shift toward sustainable and reported that only 39 percent of barangays climate-smart practices and lifestyles. utilize material recovery facilities and only 29 percent have secured access to sanitary landfill Quality of monitored water bodies remains facilities (SLF). Diversion of solid waste has low. There have been a number of notable also been low, even in Metro Manila, at a rate programs implemented to improve water of 54 percent in 2021. quality (e.g., “adopt-an-estero,” Boracay and Manila Bay rehabilitation, coastal cleanup, and 58 | Philippine Development Plan 2023-2028 improvement of wastewater infrastructure). estimates have accumulated to 6.8 million in Yet, in 2021, priority water bodies for public 2017–2022. Housing backlog persists in the water supply, food production, and recreation socialized segment due to affordability issues. still constantly exceeded guideline values Only around 96,269 socialized housing units for fecal coliform. Increasing levels of fecal were approved or demanded from 2017–2020, coliform, which is an indicator of the presence which is indicative of unaffordability. From of pathogens, can be attributed to inadequate 2001 to 2018, around 10.16 percent of the treatment facilities and the absence of housing supply has gone to the socialized measures to address point (i.e., domestic segment, and the shares have been decreasing.42 wastewater), and non-point (i.e., agricultural Housing production faced major challenges runoff) sources of water pollution. in terms of low allocation and utilization of funding, lack of suitable land, and delays in Improvement in ambient air quality remains permits and clearances. The National Housing hampered by poor monitoring and rising Authority (NHA), the government’s housing emissions from the transport sector. A production arm, has a mean budget utilization complete assessment of ambient air quality rate (BUR) of 61.38 percent from 2016 to 2022, could not be conducted due to obsolescence which was at 19.13 percent in 2019 due to and wear and tear of monitoring instruments, institutional bottlenecks; and 23.03 percent in impeding effective planning and management. 2020 due mainly to the COVID-19 pandemic. In 2021, only 11 of the 38 highly urbanized Housing backlog is further compounded by damage caused by natural hazard events. cities (HUC) monitored had complete air Almost half a million dwellings or houses quality data. Mobile sources continue to be were damaged due to disasters from 2016 to the biggest contributor of urban air pollution 2021.43 The impact of disasters on housing, at 74 percent. To address this, the government along with the lessons from COVID-19, initiated the development and incubation of underline the need to revisit requirements on new technologies for monitoring air pollutants, location, design standards, and open spaces44 and pursued initiatives such as strengthening to address public health risks, build resilience of motor vehicle inspection, improving mass to disasters, and improve the livability of transport, institutionalizing the promotion of human settlements. Strengthening public e-vehicles through passing the Electric Vehicle rental housing as an option for those who Industry Development Act, and providing cannot afford homeownership is required to the necessary infrastructure to enable active address the large deficit in housing units, fiscal mobility (See Chapter 12). challenges to meet resource requirements for housing production, low absorptive capacity Unmet housing needs. About 66 percent of of NHA, and ownership affordability issues. the 1.6 million direct housing assistance target of the government for the period 2017–2022 was accomplished. Targets were relatively low compared to the 3.7 million informal settler families (ISF) that do not have security of tenure as of 2021. Moreover, the housing need Chapter 2 Promote Human and Social Development | 59 Strategy Framework The livability of communities shall be and families. Improving the quality of the pursued along three outcomes: social natural environment allows communities environment promoted, environmental to thrive in a clean environment and access quality improved, and built environment green and public spaces. Upgrading the built upgraded (See Figure 2.3). These will be environment helps ensure that appropriate guided by the principles of equity, inclusivity, housing is connected to utilities and linked resilience, and sustainability. Promoting the to social, economic, and recreational spaces social environment gives priority to the needs by public and active transportation. All three of residents for food, health, education, social outcomes will be supported by a governance protection, and quality jobs. It will build a system that is accessible and ensures that strong sense of community among individuals livability of communities is sustained. Figure 2.3 Strategy Framework to Establish Livable Communities DEVELOP AND PROTECT CAPABILITIES OF INDIVIDUALS AND FAMILIES PROMOTE HUMAN AND SOCIAL DEVELOPMENT ESTABLISH LIVABLE COMMUNITIES SOCIAL ENVIRONMENT PROMOTED ENVIRONMENTAL QUALITY IMPROVED BUILT ENVIRONMENT UPGRADED Improve access to food, health, education, Broaden waste minimization initiatives Mobilize private sector and government safe drinking water, basic sanitation, social Increase access to proper waste disposal resources to meet housing needs services, social protection, and quality jobs facilities Improve housing affordability (Ch. 2.1, 2.2, 3.2, 5, 11, 13, 15) Expand monitoring and enforcement of air Increase access of informal settler families, Strengthen social cohesion and water quality standards homeless, and underprivileged to housing Build disaster preparedness and resilience Provide access to green spaces Integrate accessibility, health, culture, and of communities (Ch. 3.2, 11, 15) resilience outcomes into design of housing and communities Ensure availability of utilities (Ch 11) Provide public and active transportation links (Ch 11) RESPONSIVE GOVERNANCE ADVANCED Improve government accessibility (Ch. 13) Sustain community livability planning and implementation 60 | Philippine Development Plan 2023-2028 Strategies Outcome 1: Social environment promoted Improve access to food, health, selection of representatives to local special education, safe drinking water, basic bodies (See Chapter 13). sanitation, social services, social protection, and quality jobs Communities shall also be encouraged to participate in cultural, recreational, and sports Fulfilling fundamental human needs of each activities. Local culture and arts councils member of the community shall be a priority. will be promoted to plan and implement Access to food, health, education, safe drinking conservation and preservation of cultural water, basic sanitation, social services, social property and conduct cultural activities. A protection, and quality jobs shall be improved. strong national grassroots program will be Communities shall benefit from national institutionalized by the Philippine Sports programs to scale up quality job creation Commission on community-driven sporting such as upskilling to increase employability and recreational activities in line with its and increased opportunities in agriculture mandate to set the priorities and direction of and agribusiness, industries, services, and a national sports agenda, giving emphasis to sustainable resource-based livelihoods grassroots participation. (See Subchapters 2.1, 2.2, and 13.1 and Chapters 3, 4, 5, 6, 7, and 15). Community safety from crimes and violence shall be ensured through the involvement of the Strengthen social cohesion youth and community members in organized Social cohesion shall be strengthened to sports, recreational activities, and volunteer broaden community participation, secure opportunities. Substance abuse shall be treated community safety, ensure gender- and as a health problem (See Subchapter 2.1) while culture-responsive interventions, and illegal trade of these goods shall be prosecuted promote the welfare of and prevent acts of as part of the endeavors to remove criminality violence against vulnerable groups including in the community. Overall, collaboration of women; children; elderly; lesbian, gay, communities, LGUs, businesses, civil society, bisexual, transgender or transsexual, queer and other sectors shall be strengthened to or questioning, intersex, and allied, asexual, achieve peace, security, and safety, while being aromantic, or agender (LGBTQIA); as well as mindful of the contexts and needs of vulnerable indigenous peoples (IP), among others. groups (See Subchapter 13.1). Communities shall be empowered to create Build disaster preparedness and or join CSOs. They have long been one of the resilience of communities government’s partners in enabling services in The government will raise awareness, communities. CSO desks shall be created in knowledge, and skills of individuals, families, LGUs to fast-track accreditation of CSOs and enterprises, and other community stakeholders Chapter 2 Promote Human and Social Development | 61 on the hazards that their community faces. This response, especially for the vulnerable groups will build resilience through community-based and those located in far-flung areas. The Local disaster risk management and preparedness Disaster Risk Reduction and Management Plan measures. The primary step is to capacitate and the Local Climate Change Action Plan shall and empower all community members incorporate community programs and projects to be prepared and take action to protect to build adaptive and other resilience capacities, lives, livelihood, and assets from multiple and reduce risks from hazards and climate types of disasters—hydro-meteorological, change. The Post-Disaster Rehabilitation and geological, human-induced, and public health Recovery Framework shall be operationalized emergencies. This should be a continuing to ensure full recovery of households and process as livable communities may attract communities affected by disasters. migrants who may not be as familiar as the National government shall prioritize highly other community members on hazards and vulnerable, low-income LGUs to access risks in the community. Individual, family, and national programs and funds for disaster risk community preparedness will be supported reduction, climate change adaptation, and by complementary and integrated actions disaster preparedness. These include flood at all government levels on early warning control, coastal protection, early warning systems, preemptive evacuation protocols, and systems, operations center, permanent provision of permanent evacuation centers to evacuation centers, critical infrastructure limit or totally avoid the use of school facilities and facilities, and climate-resilient livelihood, for evacuation. Local governments shall among others (See Chapters 11 and 15). continue to organize and capacitate community volunteers to become frontliners in disaster Outcome 2: Environmental quality improved Broaden waste minimization recycling and other recovery programs—such initiatives as community composting and recovery of rare metals from waste electrical and electronic Waste minimization shall involve ensuring equipment (urban mining) programs—will compliance and steering behavioral change be intensified to improve resource efficiency at the individual, household, and societal and promote a circular economy. This levels toward sustainable production and shall enable public and private investments consumption practices. Compliance with the (e.g., development of green technologies and Ecological Solid Waste Management Act (RA establishment of facilities) in waste recovery, 9003), which mandates LGUs to divert more reuse, and recycling as well as manufacturing than 25 percent of solid wastes from waste and production using secondary raw materials disposal facilities, shall be pursued. Waste (See Chapter 6). The reclamation of rare 62 | Philippine Development Plan 2023-2028 materials from e-waste as raw materials others. To take advantage of economies of for renewable energy technologies will scale, LGU clustering shall be facilitated in likewise be promoted (See Chapter 12). The the implementation of appropriate common implementation of the EPR Act of 2022 will facilities—including material recovery facilities, require private companies, particularly large SLFs, and facilities for health care and hazardous enterprises, to initiate their EPR programs wastes, among others. Innovation, research to minimize waste from plastic packaging. and development, technology development, Their EPR programs will incorporate waste and science-based policy recommendations minimization strategies such as product shall be promoted. For example, the viability of packaging redesign, adoption of production waste-to-energy technologies will continue to refilling systems, and use of alternative materials be studied and the appropriate environmental in products. Moreover, the implementation of regulatory framework will be put in place. the National Action Plan on Marine Litter shall be monitored and pave the way to promote and Expand monitoring and enforcement mainstream circular economy and stimulate of air and water quality standards sustainable consumption and production. An integrated water resource management Environmental information, education, approach to address water pollution shall be and communication programs will also be adopted. Operationalization of water quality intensified using traditional and social media, management areas shall be prioritized, and school-based campaigns, and government the national water quality management fund social development and grassroots programs shall be accessed to improve capabilities in to help steer the desired behavioral change. monitoring and enforcement of applicable laws. The environmental user fee system shall Increase access to proper waste be expanded to cover non-point pollution disposal facilities sources. Multi-stakeholder initiatives to Solid, organic, and health care and hazardous improve water quality, such as massive wastes will be effectively managed to prevent clean-up, monitoring of industries, and possible adverse health, economic, and rehabilitation of esteros or rivers, shall continue environmental impacts in communities. The to be implemented. Inter-LGU collaboration delivery of waste management services by LGUs on clean-up of shared river ecosystems shall will be increased, making proper waste disposal be pursued. The adopt-an-estero program accessible to a larger population base. The shall be institutionalized at the barangay level. approval of SWM plans will also be fast-tracked. More LGUs shall enact septage management A web-based monitoring system will be ordinances to prevent untreated sewage from established to track progress and compliance contaminating water bodies as directed by by LGUs with solid waste regulations, including DILG MC 2019-62. their waste diversion mandate. DENR will continue to build the capacity of LGUs Moreover, ambient air quality monitoring and through trainings, guidelines, implementation enforcement of standards shall be improved. mechanisms, and technology transfer, among This will require upgrading of monitoring Chapter 2 Promote Human and Social Development | 63 systems, including the use of space technology. appreciation of local communities and other To expand coverage of monitoring, partnerships stakeholders on the importance of green with private stakeholders and HUCs shall be spaces shall be pursued and individual actions pursued in setting up ambient air monitoring on urban greening will be encouraged. The stations and through outsourcing from private “adopt-a-city” approach shall be piloted to service providers. Monitoring results shall encourage the business sector to support guide Monitoring Airshed Governing Boards creating green spaces. Good practices shall be and concerned LGUs to implement action replicated in more LGUs. Technical assistance plans to improve air quality. Attention will be will be provided, and financial resources will given to indoor air and noise pollution due to be accessed by LGUs that will enable them to the negative impact on health and productivity. establish green spaces (e.g., Urban Biodiversity The government will explore the development Program, National Greening Program, and or improvement of policies to ensure healthy Green, Green, Green Program). LGUs shall levels of environmental noise and indoor air include in their respective environmental quality in the workplace and in households. codes design standards for the development of green spaces. Moreover, urban farming and Provide access to green spaces community-based gardening will be intensified As envisioned in the Philippine Biodiversity to expand green urban spaces and contribute Strategy and Action Plan 2015–2028, to ensuring food security (See Subchapter 3.1). increasing green spaces at the city and barangay Programs and interventions of LGUs on levels will enhance environmental quality, developing green spaces will be considered as reduce urban heat, promote biodiversity, part of the performance criteria in the DILG’s and improve health and overall wellbeing. Seal of Good Local Governance. Increased awareness, understanding and Outcome 3: Built environment upgraded Mobilize private sector and their development loans, homeowners government resources to meet lending programs, and real estate mortgages. housing needs Availment of fiscal incentives under the Urban Development and Housing Act (RA 7279) The Department of Human Settlements shall be facilitated to encourage more private and Urban Development (DHSUD) targets sector participation in socialized housing. the financing of one million housing units Allocation of funds to key shelter agencies annually to narrow the housing deficit. This (KSA) (e.g., NHA, Socialized Housing will require the mobilization of substantial Finance Corporation, and the National Home financial resources from national and local Mortgage Finance Corporation [NHMFC]) governments, as well as government financing will be rationalized to ensure that increased institutions and private banks, with whom allocation is matched with increased absorptive the government will engage to increase their capacities. The secondary mortgage market participation in the housing sector through program of the NHMFC shall be strengthened 64 | Philippine Development Plan 2023-2028 and the housing credit guarantee programs of calamities or those permanently displaced by the Philippine Guarantee Corporation shall be infrastructure programs. Other forms of tenure enhanced. LGUs shall tap financing schemes will also be explored to address uncertainties available to them such as bond flotation and and make public housing rental viable. credit financing to raise funds for housing. The implementation of the Balanced Housing Increase access of informal Development Act, which mandates developers settler families, homeless, and proposing to undertake a subdivision or underprivileged to housing condominium project to develop an area for An inventory on the number of ISFs and socialized housing, shall be revisited. This is the homeless will be undertaken, and to ensure that the guidelines for accessing the an information database system shall be funds and monitoring the allocation and use established. Idle government lands will of the Housing Escrow Fund will be in place to be completely inventoried and a database ensure that the funds will not be underutilized established to identify potential resettlement or misused. The Housing Escrow Fund is sites for informal settlers. On-site, in-city, authorized through DHSUD Department and near-city resettlement programs shall Order 2021-004 and is a fund pool comprised be adopted. Given issues on land availability, of contributions by developers who opt to vertical housing for ISFs in metropolitan areas comply with mandated balanced housing and HUCs shall be an option. requirement via the incentivized compliance. The government may provide halfway Apart from mobilizing financial resources, homes or dormitories for the homeless who other factors affecting the delivery of housing cannot afford formal housing tenures, such targets need to be addressed as well. This as homeownership or rental housing. The includes the availability of land, construction resettlement option will be provided for ISFs materials, and workers. DHSUD shall develop living in danger zones while the community a human resources skills program to meet mortgage program will be an option for the housing production needs. rest of the ISFs with community organizations. The government shall continue programs Improve housing affordability that specifically cater to certain sectors— Subsidies in the form of mortgage such as the police, military personnel, and financing, direct housing production, and public-school teachers—and expand to community-driven development will be vulnerable sectors, such as low-income continued to ensure housing affordability. women, IPs, indigent elderly, and people Additional subsidies for ISFs will be studied with disability. to improve affordability of housing for this segment of the population. The National Resettlement Policy Framework shall be operationalized in local resettlement Rental subsidy will be an option for low-income plans and programs to ensure that resettlement ISFs and starting families, or as support for communities are livable and livelihood families that may be temporarily displaced by are restored. Chapter 2 Promote Human and Social Development | 65 Integrate accessibility, health, especially in poor and waterless municipalities. culture, and resilience outcomes into The government shall also encourage the design of housing and communities operation of water service providers as economic enterprises run by LGUs and/or The socialized and economic housing standards with private partners (See Chapter 12). (Batas Pambansa 220) shall be reviewed to consider minimum health standards; Provide public and active accessibility; cultural appropriateness; climate transportation links and disaster resilience; energy efficiency; Sustainable and affordable transportation green spaces; active mobility; innovative options shall be provided to link communities technologies; urbanization trends; and to economic, social, and cultural places. These changing housing preferences (i.e., halfway include the strengthening of the existing homes, first-time homebuyers, young public utility vehicle modernization program, professionals, and permanent family homes). and expansion of existing mass transport The implementation of open spaces such as systems and networks. LGUs shall integrate parks, playgrounds, and community facilities in their land use plans and infrastructure and amenities45 shall be strictly enforced, program the allocation and development which could likewise be used as green spaces. of local road networks that adopt active Green features in housing and community mobility options, such as walking and cycling. design shall be adopted—such as renewable LGUs shall also reflect in their local public energy, green roofs, rainwater harvesting transport route plans the transit options for systems, rain gardens, permeable pavement, their communities and adopt mechanisms to green construction materials, nature-based offset the impact of increased transportation storm drainage systems, gray water recycling costs arising from relocation. LGUs shall system, and energy-efficient windows (with adopt the use of e-vehicles supported by reference to the Green Building Code). solar-powered charging stations to service communities (See Chapter 12). Road systems shall be designed to provide safe routes in time of emergencies, ample drainage, and sufficient allocation for motorized vehicles, bicycles, and pedestrian uses. Ensure availability of utilities Improvements in building and construction milestones shall be instituted to ensure that utilities (water, electricity, telecommunications, and sanitation) are available ahead of occupancy. The government shall evaluate the effectiveness of its programs in accelerating access to water supply and sanitation services, 66 | Philippine Development Plan 2023-2028 Box 2.3. Affordable and Secure Housing in a Livable Community: Disiplina Village, Valenzuela City Disiplina Village is the biggest in-city relocation program in the Philippines. Disiplina Village is a public rental housing program in Valenzuela City, Metro Manila, offering perpetual lease in medium-rise buildings constructed by the National Housing Authority (NHA). The resettlement area accommodated a total of 3,186 families as beneficiaries. The city government owns the 11.13-hectare land. NHA investment is at PHP1.12 billion. The LGU heads the Disiplina Village Management Council with the president of the Homeowners’ Association of Disiplina Village as one of the members. Day-to-day concerns and monitoring of the buildings are taken care of by a designated flood leader and building leader, who also liaise with the City Housing and Resettlement Office and the NHA. The beneficiaries maintained their dwellings in-city where they were provided with access to social services, economic opportunities, and sports and recreational activities from the presence of community facilities such as schools, day care centers, covered courts, parks and playgrounds, multipurpose buildings, urban gardens, markets, and public terminals. More importantly, beneficiaries enjoy security of tenure formalized through their Certificate of Occupancy. Source: Pantawid Upa. 2019. Rental Housing Subsidy: Experiences and Lessons in the Philippines. Manila. Outcome 4: Responsive governance advanced Improve government accessibility Sustain community livability planning and implementation Local government units shall use the national digitalization platform, aligning with Community-driven planning for the livability digitalization programs of national government of communities shall be sustained. The agencies (e.g., digitalization of business People’s Plan46 adopted for on-site, in-city, and processes), and adopt digital governance. near city resettlement programs to address the This shall provide better information and urban sprawl shall be broadened to improve service delivery, including early warnings; livability elements.47 improve transparency in local government processes, such as housing-related licenses Participation of LGUs in planning, financing, and permits; and facilitate participation and and implementation of housing and community communication (See Chapters 11 and 13). programs shall be accelerated. LGUs shall LGUs shall likewise strengthen the digital make an inventory of their publicly owned skills of their respective constituents. land and utilize vacant, underutilized, and non-essential properties available for housing development. If necessary, the LGUs may consolidate multiple government buildings to free up land for housing. Local housing boards Chapter 2 Promote Human and Social Development | 67 shall be created or strengthened to support the in agglomeration into metropolitan areas. LGUs’ city- or municipality-wide community Governance of these metropolitan areas upgrading strategy. will need to be put in place, building upon the good practices and lessons from The comprehensive land use plan (CLUP) existing metropolitan governance models shall help shape the livability of communities (e.g., Metro Manila, Metro Cebu, and Metro while ensuring that sectoral concerns—such Iloilo-Guimaras Economic Development as ancestral lands, cultural heritage, and Council). biodiversity—are preserved. Mixed-use as well as integrated use of space that offer the Planning the livability of communities shall convenience of walkable, bikeable, compact, be linked with national housing and urban and connected communities to reduce travel development, and regional spatial development time and energy footprint shall be promoted. policies, which promote urban–rural linkages to address transboundary risks, among Zoning ordinances should be able to others. The National Urban Development and influence, for example, the way roads are Housing Framework and the National Spatial designed to accommodate infrastructure Strategy shall be updated to consider emerging for active mobility. Climate and disaster risk trends in green and resilient development and assessment shall be made a prerequisite in the promote multisectoral needs (e.g., housing, approval of areas identified for housing and transport, telecommunications, and public community development. works) for urban and regional development. Moreover, due to potential degradation Sustained community livability planning shall or irreversible damage to the natural be monitored and incentivized. DHSUD shall environment, carrying capacity assessments establish a comprehensive housing and urban will be conducted in areas where population development monitoring information system. movement needs to be managed, such as The passage of the DHSUD Act provided an ecotourism destination areas and urban areas. impetus to integrate all housing and urban Such assessments shall inform appropriate development policies, plans, programs, and policies and regulations in local plans projects. DHSUD is mandated to develop and (e.g., CLUP and Comprehensive Development maintain a shelter and urban development Plan). These assessments may also be guided management, standards, and monitoring by existing manuals developed by the information system which shall include, government (i.e., Manual on the Conduct but not limited to, the following data sets: of Urban Carrying Capacity Assessment in inventory of idle lands, CLUP, inventory the Philippines by NEDA and Manual on of housing stock, and list of beneficiaries. Computing Carrying Capacity of Ecotourism DHSUD’s role, as oversight to housing and Sites in Protected Areas by DENR). urban development-related policies and programs, requires data collection, processing, As more livable communities are built, and analysis to assess the effectiveness of strong interlocal connections will result policies and programs. Meanwhile, NEDA 68 | Philippine Development Plan 2023-2028 shall develop standards to measure livability— livability index along with applicable indicators such as travel time and distance between in DILG’s Seal of Good Local Governance and housing sites and schools and access to health DHSUD’s monitoring information system to facilities. These may be used in developing a incentivize LGU initiatives. Legislative Agenda Table 2.3.1 presents the priority legislation proposed in the 18th Philippine Congress. Table 2.3.1 Legislative Agenda to Establish Livable Communities LEGISLATIVE AGENDA RATIONALE/KEY FEATURES RESPONSIBLE AGENCY National Land Use Bill Address suitable land availability constraints for housing development by Department of Human Settlements legislating options such as removing the Comprehensive Agrarian Reform and Urban Development (DHSUD) Program (CARP) restrictions to land consolidation while maintaining land ownership by beneficiaries, completing inventory of protected areas to ascertain land for development, and tapping idle or unutilized private lands. Rental subsidy and access to public Improve access to and affordability of housing especially for the informal DHSUD rental housing settler families, homeless, and underprivileged Strengthening of Key Shelter Agencies Renew the NHA Charter and strengthen its organizational structure and DHSUD National Housing Authority (NHA) Act functions. Broaden mandate to allow securitization not only of mortgages Amendments to the National Home but also of other housing-related receivables or loans resulting in Mortgage Finance Corporation Charter increased funds available for housing development Unnecessary Plastic Products Phase out single-use plastic Department of Environment and Regulation Bill Natural Resources (DENR) Maritime Safety, Security, and Prevention and control of marine pollution from any vessel Philippine Coast Guard, DENR, Prevention of Ship-Sourced Pollution Bill Department of Science and Technology Chapter 2 Promote Human and Social Development | 69 Results Matrix Table 2.3.2 presents the indicators and targets to establish livable communities. Table 2.3.2 Results Matrix: Establish Livable Communities BASELINE TARGETS MEANS OF RESPONSIBLE (YEAR) VERIFICATION AGENCY/ INDICATOR 2023 2024 2025 2026 2027 2028 INTER-AGENCY BODY Subchapter 2.3: Establish Livable Communities Outcome 1: Social Environment Promoted Number of civil society 22,203 Increasing Department organizations accredited by of the Interior the Provincial, Municipal, or (2020) and Local City Sanggunian Government (DILG) Outcome 2: Environmental Quality Improved Proportion of barangays 41% 43% 45% 47% 49% 51% 53% Annual DENR served by material recovery Solid Waste (2021) facilities Management Report Proportion of cities and/ 32% 35% 38% 41% 44% 47% 50% DENR or municipalities served by (2021) sanitary landfill facilities Percentage of water bodies conforming with water quality guideline values for the following intended use Water supply 0% 17% 17% 33% 33% 50% 50% Annual Water DENR (2021) Quality Report Food production 0% 13% 25% 25% 38% 38% 50% DENR (2021) Primary contact recreation 46% 54% 54% 62% 62% 69% 69% DENR use (2021) Percentage of highly 59% 60% 62% 64% 66% 68% 70% Annual Air DENR urbanized and other major Quality Report (2021) urban centers within ambient air quality guideline values for particulate matter (PM) 10 and 2.5 Area of green spaces 6,835 Increasing 7,176 Comprehensive DENR, DHSUD, increased (hectare) land use DILG, LGU (2022) plan (CLUP), progress report; ordinances, resolutions Outcome 3: Built Environment Upgraded Housing units started or 6.5M 1M 1M 1M 1M 1M 1M DHSUD, KSAs financed (end-2022) Outcome 4: Responsive Governance Advanced Percentage of LGUs preparing risk-informed plans CLUP 43% 50% 60% 70% 80% 90% 100% Progress report DHSUD, LGUs (2021) Local Shelter Plans 16% Increasing Progress report DHSUD, LGUs (2022) 1 PSA Estimates, 2018 and 2020, Technical Working Group on Maternal Mortality Ratio Estimation 2 Marquez, et.al (2020). Estimating the potential impact of the COVID‐19 pandemic on key sexual and reproductive health outcomes in the Philippines retrieved from https://www.uppi.upd.edu.ph/sites/default/files/pdf/UPPI-Impact-of-COVID-19-on-SRH.pdf 3 UNICEF/WHO/World Bank. (2021). Joint child malnutrition estimates, March 2021 Edition. UNICEF/WHO/World Bank 4 World Health Organization (WHO). Immunization gaps contribute to rising measles cases in the Philippines. Accessed from: https://www.who.int/philippines/ news/feature-stories/detail/immunization-gaps-contribute-to-rising-measles-cases-in-the-philippines 5 Ulep, V. G., & Uy, J. (2021). An assessment of the expanded program on immunization (EPI) in the Philippines: Challenges and ways forward (No. 2021-04). PIDS Discussion Paper Series. 6 https://www.unicef.org/philippines/building-confidence-routine-immunization-philippines 7 Institute for Health Metrics and Evaluation. (2020, December 10). GBD Compare. Seattle, Washington. Retrieved from https://vizhub.healthdata.org/gbd- compare/; Prevention and control of Noncommunicable Diseases in the Philippines. The Case for Investment, Philippines, 2019. Geneva: World Health Organization; 2019 (WHO/UHC/CDS-NCD/19.90). 8 National Tuberculosis (TB) Prevalence Survey 9 DOH. Impact of COVID-19 Pandemic to the Philippine HIV Epidemic. Accessed from: doh.gov.ph/sites/default/files/publications/2020%20Annual%20HIV%20 Report.pdf 10 Frontiers. Philippine Mental Health Act - A Call to Look Into the Bi-directionality of Mental Health and Economy. Accessed from: https://www.frontiersin.org/ articles/10.3389/fpsyg.2021.706483/full 11 PAGASA. Climate Change in the Philippines. Accessed from: https://www.pagasa.dost.gov.ph/information/climate-change-in-the-philippines 12 Climate Adaptation Platform. Climate Change Impacts on health, and livelihood of Filipinos. Accessed from: https://climateadaptationplatform.com/climate- change-impacts-health-and-livelihood-of-filipinos-study 13 The First 1000 Days (Manual of Procedures); Ulep, V. G. T., Uy, J., & Casas, L. D. (2020). Primary health care for noncommunicable diseases in the Philippines. 14 Cuenca, J. S. (2020). Fiscal Decentralization and Health Service Delivery: An Assessment.; Solon O. and Herrin A. (2017). The Challenge of Reaching the Poor with a Continuum of Care: A 25-Year Assessment of Health Sector Performance. In Risks, Shocks, Building Resilience. Proceedings of the Second Annual Public Policy Conference 2016. Philippine Institute for Development Studies and Bangko Sentral ng Pilipinas. 15 PHFDP 2020-2040; NHRHMP 2020-2040; and 2021 Socioeconomic Report 16 NHRHMP 2020-2040 17 National Tax Research Center (2014). An Assessment of Republic Act No. 10351 or the Sin Tax Reform Law. NTRC Tax Research Journal. Retrieved from: https:// ntrc.gov.ph/images/journal/j20140910b.pdf; 18 World Health Organization (2022). Global Health Expenditure Database https://apps.who.int/nha/database/country_profile/Index/en 19 Lavares, M. P., Ross, H., Francisco, A., & Doytch, N. (2021). Analysing the trend of illicit tobacco in the Philippines from 1998 to 2018. Tobacco control, tobaccocontrol-2020-056253. Advance online publication. https://doi.org/10.1136/tobaccocontrol-2020-056253 20 Araos, N. V. V., Melad, K. A. M., & Orbeta Jr, A. C. (2022). Learning from Stories Behind Unexpected Results: A Qualitative Follow-up Study on the Third Impact Evaluation of 4Ps. Ivory Myka R. Galang, 46(2), 71.; DSWD. 4Ps concluded FDS on MaPa. Accessed from: https://pantawid.dswd.gov.ph/2022/04/4ps-concluded- fds-on-mapa/ 21 Bradley EH, Elkins BR, Herrin J, Elbel B. Health and social services expenditures: associations with health outcomes. BMJ Qual Saf. 2011 Oct;20(10):826-31. doi: 10.1136/bmjqs.2010.048363. Epub 2011 Mar 29. PMID: 21447501. 22 Hood, C. M., K. P. Gennuso, G. R. Swain, and B. B. Catlin. 2016. County health rankings: Relationships between determinant factors and health outcomes. American Journal of Preventive Medicine 50(2):129-135. https://doi.org/10.1016/j.amepre.2015.08.024 23 World Health Organization. Accessed from https://www.who.int/health-topics/social-determinants-of-health#tab=tab_1 24 Mathauer I, Dale E, Jowe M, Kutzin J. Purchasing of health services for universal health coverage: How to make it more strategic? Policy Brief, Department of Health Systems Governance and Financing, Geneva: World Health Organization; 2019 (WHO/UHC/HGF/PolicyBrief/19.6). Licence: CC BY-NC- SA 3.0 IGO. 25 Orbeta, Jr. and Pacqueo. (2022). Philippine Education: Situationer, Challenges, and Ways Forward. Retrieved from https://pidswebs.pids.gov.ph/CDN/document/ pidsdps2223.pdf; Generalao and David. (2022). “Public-Private Complementarity in Philippine Higher Education: The Current Philippine Picture”. In Fernando dlc Paragas (Eds.), Contemporary Issues in Philippine Higher Education (pp. 17-24). University of the Philippines Center of Integrative and Development Studies (UP CIDS). https:// cids.up.edu.ph/wp-content/uploads/2022/07/HERPRP-Contemporary-Issues-in-PH-Higher-Ed.pdf; Ortiz, Melad, Araos, Orbeta, Reyes. (2019). Process Evaluation of the Universal Access to Quality Tertiary Education Act (RA 10931): Status and Prospects for Improved Implementation. https://pidswebs.pids.gov.ph/CDN/PUBLICATIONS/pidsdps1936.pdf 26 Orbeta, Jr. & Pacqueo (2022) notes that private HEIs have shown better agility to respond to changing market demand and in offering courses of comparable quality at a lower price, relative to public HEIs. David and Generalao (2022) and Ortiz, et al. (2019) further highlighted the need to strategically enhance complementarity (by reducing redundancies and harnessing comparative advantage of both sectors), considering large funding support for public HEIs. 27 Latest available data on government Expenditure on Education, total (% of GDP) estimated and reported by the UNESCO Institute of Statistics and World Bank. Source: World Bank Database, https://data.worldbank.org/indicator/SE.XPD.TOTL.GD.ZS?locations=PH 28 World Bank. “The State of Global Learning Poverty: 2022 Update”, 2022. https://thedocs.worldbank.org/en/doc/ e52f55322528903b27f1b7e61238e416-0200022022/original/Learning-poverty-report-2022-06-21-final-V7-0-conferenceEdition.pdf (accessed November 14, 2022) 29 David, Clarissa C.; Albert, Jose Ramon G.; Vizmanos, Jana Flor V. 2019. “Pressures on public school teachers and implications on quality.” Philippine Institute for Development Studies. http://hdl.handle.net/11540/9702. 30 In the 2018 PISA, the Philippines ranked 76th out of 76 countries in Reading, 75th out of 76 countries in Math, and 76th out of 77 countries in Science. At the TIMSS assessment, the Philippines also ranked the lowest (among 58 countries) in both Math and Science. 31 Times Higher Education, “World University Rankings 2023 Digital Report”. October 12, 2022. https://flipbooks.timeshighereducation.com/19712/79124/index. html?37303 32 CHED, “Ateneo, UP lead 10 Philippine HEIs joining THE World University Rankings”, CHED Website. October 12, 2022. https://ched.gov.ph/ateneo-up-lead-10- philippine-heis-joining-the-world-university-rankings/ 33 In compliance with the Barangay-Level Total Development and Protection of Children Act (RA 6972). Chapter 2 Promote Human and Social Development | 71 34 Woodhouse, A. and Lamport, M. (2012). The relationship of food and academic performance: A preliminary examination of the factors of nutritional neuroscience, malnutrition and diet adequacy. 35 TESDA. (2018) National Technical and Educational Skills Development Plan 2018-2022: Vibrant Quality TVET 36 Livable communities may refer to a neighborhood, a socialized housing project, an infill development site, or a resettlement area which will collectively upscale livability of the city, municipality, and a metropolitan area where they are located. Livable communities broaden the concept of human settlements by focusing on human wellbeing, citizen engagement, social cohesion and environmental sustainability elements of livability apart from the built environment emphasis of human settlements. Republic Act 11201 or the Department of Human Settlements and Urban Development (DHSUD) Act defines human settlement as “comprising of (a) physical components of shelter and infrastructure; and (b) services to which the physical elements provide support such as community services which include education, culture, welfare, recreation and nutrition.” 37 UN HABITAT 2021. Rapid Research on COVID-19 Pandemic to the Urban Poor and Other Vulnerable Groups in the Cities of Ozamiz and Tagum. 38 Survey of poor communities in 101 and 135 barangays across Luzon, Visayas, and Mindanao in September 2020 and April 2021 conducted by World Bank, Department of Social Welfare and Development, and the Australian Government. 39 2022. Francis Atwil, et.al. World Risk Report 2022. Bündnis Entwicklung Hilft and Ruhr University Bochum. Aachen, Germany 40 2022. INFORM. INFORM Risk Index 2023. https://drmkc.jrc.ec.europa.eu/inform-index. INFORM is a multistakeholder forum of the Inter-Agency Standing Committee Reference Group on Risk, Early Warning and Preparedness and the European Commission. The European Commission Joint Research Centre is the scientific lead of INFORM. 41 2019. DENR in National Tax Regulation Council (NTRC) Regulation on the Use of Plastic Bags in the Philippines and Other Countries. NTRC Tax Research Journal. September-October 2019 42 Clearing the Housing Backlog: An Updated Supply and Demand Study on ODC Segment. Habitat. https://www.habitat.org/sites/default/files/documents/ Clearing-the-Housing-Backlog.pdf 43 OCD. 2022. Midterm Monitoring Matrix: Sendai Framework for Disaster Risk Reduction 2015-2030 44 PD 1216 requires the developer or owner of a residential subdivision one hectare or more to allocate 30 percent of the gross area for open space. Open space shall mean an area reserved exclusively for parks, playgrounds, recreational uses, schools, roads, places of worship, hospitals, health centers, barangay centers or other similar facilities and amenities. 45 PD 1216 requires the developer or owner of a residential subdivision one hectare or more to allocate 30 percent of the gross area for open space. Open space shall mean an area reserved exclusively for parks, playgrounds, recreational uses, schools, roads, places of worship, hospitals, health centers, barangay centers or other similar facilities and amenities. 46 The People’s Plan refers to a community development plan that is comprised of a housing design and site development plan. This Plan may also include non- physical developments (e.g., livelihoods, self-help development, and capability development training, etc.). It is developed through a process of consultation with, and endorsement by, the beneficiaries. A social preparation process is needed to craft a People’s Plan. This process includes establishing social and organizational capabilities, norms, and mechanisms. These will enable the settlers to work together and develop their housing resettlement plans. The process is conducted in partnership with concerned institutions and stakeholders. Through this partnership, settlers can actively participate in housing resettlement projects and resolve problems and issues among community members or with the government and other entities. The legal framework of the People’s Plan is defined by the Policy Guidelines on the operationalization and utilization of the PHP 50 billion Housing Fund for ISFs in Danger Areas in the National Capital Region (ISF-National Technical Working Group JMC 2013). 47 Patrick I. Patino. Institute of Popular Democracy. 2016. Building safe and resilient communities against poverty and disaster. Asian Cities Climate Resilience Working Paper Series 29. 2016. INFORM. 2022. “Inform Risk Index 2023.” Accessed in November 2022. https://drmkc.jrc.ec.europa.eu/inform-index P. Patino. 2016. Institute of Popular Democracy. “Building safe and resilient communities against poverty and disaster”. Asian Cities Climate Resilience Working Paper Series 29: 2016. Accessed in November 2025. UN HABITAT. 2021. “Rapid Research on COVID-19 Pandemic to the Urban Poor and Other Vulnerable Groups in the Cities of Ozamiz and Tagum”. Accessed in November 2022. https://designingresilience.ph/wp-content/uploads/Resilient-and-Green-Recovery-Research_v2_15June_a.pdf WB, DSWD and Australian Government. 2021. “Impacts of COVID-19 on Communities in the Philippines Results from the Philippines High Frequency Social Monitoring of COVID-19 Impacts”. Accessed in November 2022. https://documents1.worldbank.org/curated/en/307821629731362571/pdf/Results-from-the- Philippines-High-Frequency-Social-Monitoring-of-COVID-19-Impacts-Round-2.pdf#page=6W. Padojinog and E. Yap. 2020. Clearing the Housing Backlog: An Updated Supply and Demand Study on Unserved Owner-Driven Construction Segment in the Philippines. Center for Research and Communication Foundation, Inc. and Habitat for Humanity: Terwilliger Center for Innovation in Shelter. 72 | Philippine Development Plan 2023-2028 03 Reduce Vulnerabilities and Protect Purchasing Power CHAPTER 3 Reduce Vulnerabilities and Protect Purchasing Power As articulated in AmBisyon Natin 2040, the Filipino people desire a stable and high level of well-being wherein they are secure in the knowledge that they have enough to provide for their wants and needs and can prepare for their own and their families’ futures. Amid the multiple threats to food security from both global and domestic sources, the Philippine Development Plan (PDP) 2023–2028 underscores collective action that will keep food prices within the reach of every Filipino. This will be pursued by diversifying food supply sources, strengthening buffer stocks for emergencies, optimizing digital platforms for the marketing and delivery of food, and proactively monitoring the supply and demand for key commodities. In addition, the country needs a transformative social protection system that empowers every Filipino to prevent, respond to, and recover from possible shocks. Such a transformative system would go beyond risk management intervention and includes responses to structural vulnerabilities and social discrimination that will help Filipinos access programs covering all types of risks throughout their lifetime. Subchapter 3.1 Ensure Food Security and Proper Nutrition This chapter presents the challenges in food expanded; and (c) nutrition across reducing vulnerabilities and protecting all ages improved. In subchapter 3.2: (a) a purchasing power, including the outcomes universal, modern, and integrated social to be pursued to address these challenges protection system achieved; (b) individual and during the Plan period. It consists of two life cycle risks mitigated; (c) economic risks subchapters with the following outcomes. In managed; (d) natural, health, climate, and subchapter 3.1: (a) sufficient and stable supply other human-induced hazards mitigated; and of food commodities attained; (b) access of (e) governance and political risks addressed. consumers to affordable, safe, and nutritious Assessment and Challenges The country’s progress in attaining food favorable), it only ranked 64th out of 113 security has been slow, posting a score within countries. In 2022, the country’s score slipped the moderate food security category1 since to 59.3 amid global economic headwinds, 2012, based on the Global Food Security including the Russia–Ukraine conflict that Index. In 2020, when the Philippines recorded led to food price spikes. Among Southeast its highest score of 61 (100 being the most Asian countries, the Philippines was ahead Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 77 of Myanmar, Cambodia, and Laos,2 but ongoing Russia–Ukraine conflict. Unabated, lagged behind Singapore, Malaysia, Vietnam, the increase in food prices will push more Indonesia, and Thailand.3 Filipinos to hunger and likely overturn gains in national nutrition targets achieved so far. While food inflation in the last five years was generally within target, recent There have been varying degrees of success supply-side shocks resulted in higher food in addressing malnutrition. From 2015 to inflation. From 2017 to 2021, food inflation 2021, the prevalence of both stunting and averaged at 3.7 percent, which is well within wasting among children under five years of age the 2–4 percent target specified in the PDP decreased, the former from 33.4 to 26.7 percent 2017–2022. However, it accelerated to 6.7 and the latter from 7.1 to 5.5 percent. Despite percent and 4.5 percent in 2018 and 2021, the coronavirus disease (COVID-19) respectively. Among the top contributors to pandemic, both the targets for the reduction the surge in the overall inflation was the sharp of stunting and wasting were attained. price increases in rice (in 2018), meat, and fish. Meanwhile, the proportion of households Following the passage of Republic Act 11203 that met 100 percent of recommended energy or the Rice Tariffication Law in 2019, rice intake worsened from 31.7 percent in 2015 supply increased and ceased to be among the to 21.8 percent in 2018. The quarantine drivers of inflation. The price of meat also rose restrictions due to COVID-19 also limited in 2018 and 2021 as the local hog production the mobility and livelihood of households, contracted due to weather disturbances and thus aggravating food insecurity. Based on the African Swine Fever. Meanwhile, the depletion results of the Expanded National Nutrition of fish stock in the country, limited supply Survey (ENNS) conducted by the Department of quality fish fingerlings for aquaculture of Science and Technology–Food and production, and unfavorable weather Nutrition Research Institute (DOST-FNRI) in conditions, among others, resulted in elevated 2021, 33.4 percent of households experienced fish prices (See Chapter 5). moderate to severe food insecurity, of which 2 percent suffered from severe food insecurity Food inflation sharply increased to 10.3 or did not have food for a day or more. To percent in November 2022, up from only 1.6 mitigate the pandemic’s impact, the Nutrition percent in January 2022. This can be attributed Cluster6 issued guidelines in 2020 to ensure to the decline in the local production of key the continued provision of nutrition service food commodities such as palay, sugarcane, delivery during the pandemic and in any vegetables (e.g., tomato and cabbage), fruits future emergencies. (e.g., mango and banana), and fish (e.g., bangus and galunggong).4 Domestic production and Various policies, programs, and initiatives transportation of agricultural commodities on hunger, nutrition, and food security were to markets were affected by typhoons that implemented, especially during the pandemic hit the country since the fourth quarter of and the ongoing Russia–Ukraine Conflict. In 20215 and the soaring prices of farm inputs the previous Plan period, the Inter-Agency (e.g., fertilizer, feeds, and fuel) due to the Task Force on Zero Hunger7 formulated the 78 | Philippine Development Plan 2023-2028 National Food Policy and spearheaded the regulations and inspection protocols across all implementation of the Pilipinas Kontra Gutom transport modes. Inadequate storage facilities campaign.8 With the objective of ending hunger such as warehouses and cold storage further and poverty in the country, the Department aggravate the slow movement of inputs and of Social Welfare and Development (DSWD) food products. The additional taxes and fees pursued convergence projects with other imposed by local government units (LGU) agencies through the Enhanced Partnership on goods crossing their respective borders Against Hunger and Poverty Program. also raise the transport costs and retail prices The Department of Agriculture (DA) also of food products. These issues became more implemented the Plant, Plant, Plant Program9 prominent during the pandemic. to boost local production and ensure adequate food supply during the pandemic. Meanwhile, the expansion in consumers’ Complementary interventions of the DA access to affordable, safe, and nutritious and DSWD extended financial assistance food is constrained by inequitable access to to vulnerable groups, including farmers the internet, inadequate information and and fisherfolk,10 to help them cope with the communications technology infrastructure, surge in commodity prices. To ensure proper and limited use and knowledge of digital nutrition, other policies and programs were technologies. This so-called digital divide also undertaken, such as the Masustansyang manifests in the inability of many to participate Pagkain para sa Batang Pilipino Act (RA in emerging online market platforms for 11037),11 which institutionalizes the feeding availing safe and nutritious food when programs of the DSWD and Department of traditional supply chains are disrupted, like Education (DepEd). during disasters or emergencies. There were also challenges encountered in Improvement in nutrition across all age ensuring food security and proper nutrition. groups is undermined by the following: The production sector is vulnerable to myriad (a) insufficient supply and access to healthy shocks—ranging from typhoons, disease food and diets; (b) inadequate care and outbreaks, pandemics to armed conflicts— feeding practices and behaviors; and (c) poor threatening the stability and sufficiency of food access to adequate health, water, sanitation, supply. Aside from reducing food production, and food safety services, among others. The extreme weather events and other disasters situation is also aggravated by fragmented also limit food distribution. This occurs when and uncoordinated approach of relevant transportation and logistical facilities are agencies and stakeholders for nutrition as hampered, resulting in delayed delivery of well as the inadequate financial and human commodities to end-users and food spoilage. resources devoted by LGUs to the provision of Movements along the supply chains are further age-specific nutrition interventions. disrupted by conflicting and outdated traffic Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 79 Strategy Framework To ensure food security and proper nutrition consumers to affordable, safe, and nutritious of Filipino families and their members, food; and (c) improving nutrition across all concerted efforts of the government, private ages (See Figure 3.1). Such strategies will help sector, and other stakeholders will be geared reduce food insecurity and end hunger by toward (a) attaining sufficient and stable supply providing accessible and affordable safe and of food commodities; (b) expanding access of nutritious food for all Filipinos, at all times. Figure 3.1 Strategy Framework to Ensure Food Security and Proper Nutrition DEVELOP AND PROTECT CAPABILITIES OF INDIVIDUALS AND FAMILIES REDUCE VULNERABILITIES AND PROTECT PURCHASING POWER FOOD SECURITY AND PROPER NUTRITION ENSURED SUFFICIENT AND STABLE SUPPLY OF ACCESS OF CONSUMERS TO NUTRITION ACROSS ALL AGES AFFORDABLE, SAFE, AND NUTRITIOUS FOOD COMMODITIES ATTAINED FOOD EXPANDED IMPROVED Boost productivity and resiliency of the local Promote private investment in facilities, transport, Adopt a whole-of-society approach in agriculture and fisheries sector (See Chapter 5) and logistics systems to bring safe and nutritious promoting healthy lifestyle and a culture of food closer to consumers (See Chapter 5) active health-seeking behavior among Filipinos Diversify food supply sources by augmenting across age groups and income classes domestic supply through international trade and Ramp up the promotion and use of digital platforms maximizing the use of non-traditional agricultural for marketing, delivery, and payment transactions Intensify the development and adoption of areas technologies that increase the nutritional Improve food transportation and distribution content and prolong shelf-life of food products Streamline and improve the implementation of processes to hasten and ensure unhampered trade regulatory measures movement of food products Implement measures to prevent and address wasting, stunting, and obesity Strengthen buffer stocking of rice and other basic Strengthen price and supply monitoring of food food items for emergencies and disasters commodities Strengthen nutrition-specific, nutrition-sensitive, and enabling interventions especially at the Address anti-competitive practices and price local level manipulation Reduce and prevent food losses/waste Improve nutrition governance especially in Intensify promotion of food labeling and food safety local government units measures Strategies Outcome 1: Sufficient and stable supply of food commodities attained Boost productivity and resiliency of production to maximize the use of resources; the local agriculture and fisheries (b) consolidation and clustering of farms to sector take advantage of economies of scale; and (c) adoption of improved technologies to Achieving sufficient and stable food supply modernize the sector. Access of primary requires intensified interventions to enhance producers to production inputs shall also be agriculture and fisheries productivity and improved, in conjunction with efforts to hasten resilience (See Chapter 5). The interventions land titling, improve water management, utilize to be pursued include the (a) diversification of farm and non-farm wastes and biological 80 | Philippine Development Plan 2023-2028 materials as fertilizer sources, and improve and as accessible food sources. This will prove the provision of credit. The development of beneficial when the usual food supply chains the blue economy, which is a critical source of are disrupted. Households and communities fisheries and aquaculture products, shall also will likewise be encouraged to till idle or vacant be prioritized. lots for food. In this endeavor, the government shall provide production inputs, such as seeds Meanwhile, the creation and adoption of or seedlings, soil, compost, and initial stock climate- and disaster-resilient technologies (e.g., small ruminants, chicken, and ducks) as shall be expanded to improve the resiliency starter kits, complemented with skills training of the agriculture and fisheries sector. This (e.g., sowing of seeds and proper management, will be accompanied by the development and composting, and pest disease management). mainstreaming of early warning systems and anticipatory mechanisms (See Chapter 5). Streamline and improve the implementation of trade Diversify food supply sources regulatory measures by augmenting domestic supply through international trade This strategy includes the government’s full and maximizing the use of adoption of a risk-based inspection system non-traditional agricultural areas in lieu of a 100 percent physical inspection. While such a system will still ensure the safety The temporary and short-term reduction of imported agri-food commodities, it will of tariffs and expansion of minimum access also reduce inspection costs. Moreover, the volume shall be pursued to complement Bureau of Customs’ National Single Window insufficient local production of food shall be improved and linked with the DA’s commodities, especially when disasters and Trade System. Overlapping and redundant other shocks (e.g., Russia–Ukraine conflict, non-tariff measures shall also be reviewed and pandemic, and transboundary animal diseases) rationalized. To improve the efficiency in the occur. To assess the necessity of such measures, implementation of critical non-tariff measures, the government shall proactively monitor and sufficient investment for manpower and border enhance supply-demand forecasting of key examination facilities (e.g., Cold Examination commodities (e.g., rice, meat, fish, vegetables, Facility in Agriculture) shall be provided. and sugar) to anticipate possible shortages. An anticipatory mechanism will facilitate Strengthen buffer stocking of rice the timely implementation of appropriate and other basic food items for measures to enhance domestic supply and emergencies and disasters forestall the sudden or sharp uptick in The National Food Authority (NFA) shall domestic food prices. ensure the maintenance of adequate12 rice buffer Production in non-agricultural areas, such as stock at any given time, as determined by the urban farming, vertical or rooftop gardening, NFA Council, and strategically pre-position and school and community gardening, shall these stocks for easy access during calamities be further promoted for subsistence supply and disasters. Meanwhile, the DSWD shall Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 81 ensure the swift distribution of food packs The establishment of food banks and community to distressed families in affected areas. These pantries as food redistribution mechanisms food packs will contain nutritious, culturally shall be encouraged through the collaboration appropriate, and safe food, and include infant of the government and private sector. and young child feeding commodities. For Moreover, the government shall intensify their part, households, when possible, can IEC activities on the practical benefits of and practice stocking food items in preparation for ways to cut down food waste. These include calamities and disasters. To encourage them, environment-friendly dining options; proper the government shall also develop the necessary food storage and preservation methods information, education, and communication (e.g., drying, freezing, and salting); and food (IEC) materials and conduct IEC campaigns. and kitchen waste composting in households. Appropriate policies at the national and Reduce and prevent food losses local levels shall be enacted to prioritize the or waste implementation and ensure adequate funding The provision of facilities, equipment, and for these initiatives. Such policies may include capacity building for community composting the legislation of a Food Waste Management (e.g., Bureau of Soils and Water Management Policy that will promote, facilitate, and ensure Composting Facilities for Biodegradable waste reduction in all sectors of society. Wastes) will be continued (See Subchapter 2.3). Outcome 2: Access of consumers to affordable, safe, and nutritious food expanded Promote private investment in guidance to the private sector and rationalize facilities, transport, and logistics overall investment, the use of planning tools and systems to bring safe and nutritious information systems such as the Agricultural food closer to consumers and Biosystems Engineering Management Information System,13 shall be promoted While the government will strengthen the (See Chapter 5). In addition, the registration establishment of strategically located facilities processes required for the construction, such as interconnected transport systems, establishment, or operation of the necessary wholesale food terminals and trading centers, facilities and logistics as well as food safety and and other production and postharvest facilities quality requirements shall be streamlined. (e.g., complementary food production facilities of the DOST–FNRI), these will not be enough. Ramp up the promotion and use Also critical will be complementary private of digital platforms for marketing, sector investments such as warehouses, cold delivery, and payment transactions chains, cold storage and refrigeration facilities, mobile storage, cloud kitchens and mobile Online marketing platforms implemented by marketplaces, rolling stores, processing facilities, the government (e.g., e-Kadiwa, Co-opBiz, and digital marketing channels. To provide and Deliver-E) and the private sector have 82 | Philippine Development Plan 2023-2028 served as efficient means for consumers Diskwento Caravans, and Presyong Risonable to access food, albeit in only a few areas. Dapat Program. Thus, efforts will be pursued to expand these online platforms, especially in areas Strengthen price and supply outside of the National Capital Region, and monitoring of food commodities ensure that stakeholders (e.g., consumers, The DA and DTI shall expand the use of producers, and food businesses) can easily mobile- and web-based price monitoring access these platforms (See Chapter 5). The applications such as DA’s Bantay Presyo Ni government shall also promote consumer Ani at Kita14 and DTI’s e-Presyo.15 Consumers and producer rights’ protection against fraud, may use these convenient online platforms to cybercrime, and payment and website security access necessary information on the prices and issues (See Chapter 7). quality of food commodities and protect them from unscrupulous traders. Furthermore, Improve food transportation and the Local Price Coordinating Councils distribution processes to hasten and (LPCC)16 in each province or municipality ensure unhampered movement of shall be reactivated through the issuance food products of Department of the Interior and Local Coordination among government agencies Government (DILG) memorandum circular. (e.g., DA, Department of Trade and Industry This is to closely monitor prices of agricultural [DTI], and LGUs) in the transportation commodities and processed goods, and and delivery of food products shall be coordinate and rationalize programs intended further strengthened. This will include the to stabilize prices and supply at the local level. harmonization of transportation guidelines at the national and local levels. Moreover, food Moreover, existing tools that help monitor lanes will be used for faster transportation of the food security status of the country shall food products and the suspension of pass-thru be continued and strengthened to better fees for the transport of goods and products will guide the formulation and implementation of be strictly implemented. Establishing hotline programs (e.g., Local Nutrition Early Warning numbers for quick and effective responses to System17 and Integrated Food Security Phase complaints by designated provincial officers is Classification18). A dashboard that links also needed. The timely release of food stocks supply- (e.g., areas where commodities are from cold storage will also help ensure the planted and expected volume of production) continuous adequate supply in the market. and demand-side information (e.g., volume of food requirements per area) shall also be The DTI and DA, in collaboration with created (See Chapter 5). LGUs, manufacturers, and distributors, shall strengthen the implementation of Address anti-competitive practices programs that facilitate the delivery of goods and price manipulation to consumers such as Kadiwa ni Ani at Kita, The Philippine Competition Commission shall be vigilant in monitoring anti-competitive Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 83 practices, such as cartels, price-fixing, and rules and regulations in managing risks and market division or allocation, among others, addressing food safety and quality standards. and thereby secure the benefits of both This will cover measures on the traceability of consumers and businesses (See Chapter 10). products to support the targeting of regulations The DA and DTI, in coordination with LGUs and regulatory actions to specific sources of risks. and accredited consumer groups, shall There is also a need to strengthen, harmonize, also intensify monitoring and enforcement and streamline regulatory services and develop activities to protect consumers from price standards to ensure safe and quality products, manipulation and ensure that prices of basic facilitate trade, and promote ease of doing necessities like rice and prime commodities business. Institutional and human capacities are kept within reasonable levels. of key agencies (e.g., Department of Health [DOH],19 DA,20 and DTI21) to enforce regulations Intensify promotion of food labeling and enhance consumer awareness on the safety and food safety measures and quality of food products shall be enhanced. The government shall strengthen the implementation of measures and other existing Outcome 3: Nutrition across all ages improved Adopt a whole-of-society approach with other stakeholders (e.g., private sector, in promoting healthy lifestyle and non-government organizations [NGOs], and a culture of active health-seeking development partners), shall intensify IEC behavior among Filipinos across age activities that emphasize the benefits of eating groups and income classes nutritious food. To be promoted as well is the consumption of local and traditional Multi-sectoral approaches and enabling food like root crops, fruits, vegetables, and environments for nutrition will be fostered seaweeds, organically grown and processed across all life stages and consumer groups products as healthy and chemical-free (e.g., Muslims, Christians, and Buddhists). food options, and food alternatives that Promotion of a healthy lifestyle (e.g., meet dietary needs (e.g., plant-based food dietary diversity guided by Pinggang alternatives and alternative proteins). IEC Pinoy22 by age group) will first improve materials will be digitalized (e.g., Nutri-bus nutrition and health literacy, and second, to display nutrition education videos), while promote health-seeking behavior among also maximizing the use of various forms Filipinos. Social and behavior change and of media. To reach the widest audience communication for nutrition should be possible, information will also be translated advocated at the individual, community, to the appropriate language or dialect and environmental, and structural levels to customized to each target audience. improve outcomes. The government, together 84 | Philippine Development Plan 2023-2028 Intensify the development and services critical to the first 1,000 days of life adoption of technologies that will be ensured especially during emergencies. increase the nutritional content Quality and timely data shall be collected for and prolong the shelf-life of food accurate assessment and decision-making and products for prioritizing the early detection of stunting and wasting among young children. The The government, state universities and promotion of healthy eating environments and colleges, and private sector shall intensify the healthy lifestyles shall also be strengthened to development of safe, affordable, nutritious, manage and prevent malnutrition and obesity. and energy-dense food products to address malnutrition (e.g., enhanced Nutribun; Strengthen nutrition-specific, sesame seeds-based, and rice–mongo-based nutrition-sensitive, and enabling complementary foods developed by interventions especially at the local DOST–FNRI). Development of processing level and packaging technologies to prolong shelf life and improve the nutritional content of LGUs, in coordination with the DOH and food products (including utilization of waste National Nutrition Council (NNC), will ensure products and startups for processing and that appropriate nutrition and health-related packaging) shall likewise be pursued. Moreover, interventions and services will be given during the government shall (a) strengthen research the first 1,000 days of life, which includes and development efforts on food fortification pregnancy and the infant’s first two years of life. (e.g., large-scale fortification of staple foods); This is the so-called window of opportunity to (b) promote and utilize iron-fortified rice and influence the mental, productive, and health other products (e.g., NFA’s Rice Fortification capacities of young children and to break the Project); and (c) explore advanced and intergenerational cycle of malnutrition. This emerging technologies (e.g., food preservation, includes the provision of interventions to smart packaging, and targeted nutrition), mothers and their children under Kalusugan including biotechnology (e.g., Golden Rice23 at Nutrisyon ng Magnanay Act (RA 11148), and orange-fleshed sweet potato). The private also popularly known as First 1000 Days Law. sector’s role in the development of new Implementation of nutrition-specific technologies, both in processing and delivery interventions shall be fortified, such as the of food, will also be enhanced especially since Infant and Young Child Feeding, Philippine they have the financial resources, social capital, Integrated Management of Acute Malnutrition, and expertise. National Dietary Supplementation Program,25 Implement measures to prevent National Nutrition Promotion Program and address wasting, stunting, and for Behavior Change, Micronutrient obesity Supplementation, 26 Mandatory Food Fortification, Nutrition in Emergencies, and The government shall promote the convergence Overweight and Obesity Management and of services to counter the causes of the triple Prevention Program. To the extent possible, burden of malnutrition.24 The delivery of Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 85 food requirements of feeding programs and maximize the returns to investments in relief operations shall be sourced from farmers nutrition. Hence, nutrition governance will be and fisherfolk groups and cooperatives, which improved by strengthening barangay nutrition will also provide farmers and fisherfolk with scholar programs, establishing LGU nutrition assured markets (See Chapter 5). offices, enhancing the functionality of all local nutrition committees and capacities of local Improve nutrition governance nutrition workers, and strengthening the especially in local government units coordination system between the national and Convergence of interventions, through local government through the NNC. horizontal and vertical coordination, will Legislative Agenda Table 3.1.1 presents the priority bills of the 19th Congress to ensure food security and proper nutrition. Table 3.1.1 Legislative Agenda to Ensure Food Security and Proper Nutrition LEGISLATIVE AGENDA RATIONALE RESPONSIBLE AGENCY Enactment of Urban The proposed law aims to promote urban agriculture and vertical farming in the Department of Agriculture (DA), Agriculture Law country’s metropolitan areas as an instrument to contribute to attaining food security. Department of the Interior Under this proposal, the use of available government- and privately owned land and Local Government (DILG), resources in urban areas suitable for growing crops and raising poultry, livestock, and Department of Education (DepEd), aquaculture will be promoted for agriculture purposes. local government units (LGU), state universities and colleges Food Waste Management This policy seeks to address the growing food waste problem in the country by adopting National Nutrition Council (NNC), Policy and institutionalizing mechanisms that will promote, facilitate, and ensure food waste Department of Environment and reduction across different sectors of society (e.g., households, food establishments, Natural Resources, Department of food distributors, and supermarkets). This will include the establishment of (a) food Social Welfare and Development, donation and distribution platforms and networks such as food banks and community DepEd, Department of Health pantries; and (b) community composting that may be linked with initiatives on (DOH), DA, Department of Trade developing green urban spaces, including urban agriculture sites. and Industry (DTI), Department of Tourism, Department of Energy (DOE), DILG, and LGUs Amendment of The amendment will upgrade the qualification standards, incentives, and benefits, and DILG, LGUs, DOH, NNC Presidential Decree ensure the security of tenure of BNS. This is essential in the continuing capacity building 1569 or Strengthening and sustained delivery of quality frontline nutrition services to the community. Further, Barangay Nutrition this will ensure that trained and experienced BNS are carried over by succeeding Scholars (BNS) political administrations. Establishment of LGU The presence of a Nutrition Office with adequate and competent staff complement will DILG, LGUs, DOH, NNC nutrition offices ensure that local governments have nutrition focal persons on the ground for nutrition programs to be properly implemented and able to benefit the targeted beneficiaries, especially the vulnerable and high-risk groups. Anti-Unhealthy Foods in This proposed law prohibits selling, promoting, marketing, or advertising unhealthy DOH, NNC, DepEd, DILG, LGUs Schools Act foods or junk foods and sugary drinks within 100 meters of school premises in all public and private preparatory, elementary, and junior and senior high schools. This will help prevent overweight and obesity among school children. Amendment of RA 8976 The proposed amendment aims to resolve gaps and inconsistencies of RA 8976 with DOH, NNC, Food and Drug or Food Fortification Law RA 11037 (Child Nutrition Act), RA 10611 (Food Safety Act of 2013), and RA 8172 (Act for Administration, DTI, Department Salt Iodization Nationwide). In particular, the amendment will focus on the coverage of Science and Technology–Food of mandatory fortification for rice, authorizing the NNC Governing Board to add and and Nutrition Research Institute, remove food for fortification and other provisions that need updating. This proposed DA, and Land Bank of the legislative measure will also amend RA 8172 to enhance support for the local salt Philippines industry. 86 | Philippine Development Plan 2023-2028 Results Matrix Table 3.1.2 presents the indicators and targets to ensure food security and proper nutrition. Table 3.1.2 Results Matrix: Ensure Food Security and Proper Nutrition BASELINE TARGETS MEANS OF RESPONSIBLE AGENCY/ INDICATOR (YTD VERIFICATION INTER-AGENCY BODY 2022) 2023 2024 2025 2026 2027 2028 EOP Intermediate Goal: Develop and Protect Capabilities of Individuals and Families Chapter Outcome: Reduce Vulnerabilities and Protect Purchasing Power Subchapter 3.1: Ensure Food Security and Proper Nutrition Philippine food security 59.3 Increasing Global Food National Economic and index score increased Security Index Development Authority Report (NEDA) Board, National Nutrition Council (NNC) Governing Board, and other rural development agencies (e.g., Department of Agrarian Reform and Department of Environment and Natural Resources Outcome 1: Sufficient and stable supply of food commodities attained Food inflation rate (%) 5.7 2.5-4.5 2-4 2-4 2-4 2-4 2-4 2-4 Inflation NEDA Board kept stable* (Jan-Nov) Report Outcome 2: Access of consumers to affordable, safe, and nutritious food expanded Subsistence incidence 5.9 4.5-5.5 N/A 3.5-4.5 N/A 3.0-4.0 2.5-3.5 2.5-3.5 Poverty NEDA Board among population (%) (2021) Statistics reduced** Report Prevalence of food insecurity (a. severe) in the population (%) decreased a. Severe food 2.0 0 0 0 0 0 0 0 Expanded NNC Governing Board insecurity (2021) National Nutrition b. Moderate to severe 33.4 (2021) 31.7 30.1 28.5 27.1 25.7 24.4 24.4 Survey (ENNS) food insecurity Outcome 3: Nutrition across all ages improved Proportion of households 21.8 26.6 27.8 29.0 30.2 31.4 32.6 32.6 ENNS NNC Governing Board meeting 100% (2018- recommended energy 2019) intake (%) increased Prevalence of stunting 26.7 25.2 23.8 22.3 20.8 19.4 17.9 17.9 ENNS NNC Governing Board among children under (2021) five years of age (%) decreased Prevalence of 5.5 5.3 5.1 4.9 4.7 4.5 4.3 4.3 ENNS NNC Governing Board malnutrition for children (2021) under five years (wasting) (%) decreased * Based on Chapter 1 Targets. ** N/A for non-Family Income and Expenditure Survey years. Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 87 Subchapter 3.2 Strengthen Social Protection Assessment and Challenges Strides in social protection. Social protection Social protection during the pandemic. (SP) in the country has gone a long way since it Social protection programs helped mitigate was officially defined by the Social Development the impact of the COVID-19 pandemic. Committee in 2007. In the same year, an Specifically, the Social Amelioration Program operational framework was also approved to prevented about four million Filipinos from guide the implementation of SP programs; falling into poverty.27 A World Bank estimate and the Pantawid Pamilyang Pilipino Program suggests that the poverty rate would have been (4Ps) was piloted and rolled out nationwide, almost 2 percentage points higher in 2020 becoming the largest conditional cash transfer in the absence of government assistance.28 program in the country. In tandem with 4Ps, However, the weaknesses of the social a National Household Targeting System for protection system were revealed during the Poverty Reduction or the Listahanan was pandemic. Since there was no single database implemented in 2009 to replace patchy and of beneficiaries then, the DSWD, DILG and often politicized mechanisms in selecting the LGUs had to rely on different beneficiary beneficiaries of various programs. Pending the targeting protocols. In particular, the DSWD results of Listahanan 3 (the third iteration of used its own lists for the 4Ps and social the list of 4Ps beneficiaries), the government pension, livelihood assistance grants, other still uses the Listahanan 2 developed in 2015. social assistance packages, and list of overseas This prevents concerned agencies from workers from the Overseas Workers Welfare including new qualified beneficiaries in Administration (OWWA) in the Department their means-targeted programs, resulting in of Labor and Employment (DOLE).29 Without inequities in the provision of needed support. a comprehensive digital ID system in place, More recently, significant legislations that beneficiary enrolment was done with little expand social protection coverage were passed deduplication or eligibility verification against such as the Universal Health Care Act, 4Ps Act, government databases. Most processes were Community-Based Monitoring System Act, carried out manually, especially those that and Philippine Identification System (PhilSys) involve application for programs, beneficiary Act. Social protection programs were also enrolment, and cash transfer payments.30 The initiated to help the affected individuals and delivery of assistance was further delayed sectors cushion the adverse impact of key policy due to major logistical issues exacerbated by reforms such as the Tax Reform for Acceleration mobility and geographical constraints. and Inclusion Law and the Rice Tariffication Law. Moreover, national consultations were Low social protection expenditure and held to determine social protection floors for coverage. Government spending on SP programs health, children, working adults, and the elderly. as percentage of gross domestic product (GDP) in 2021 was at 2.7 percent. The country’s government 88 | Philippine Development Plan 2023-2028 expenditures on social protection have recorded rest ranked higher—Malaysia (4.2%), Thailand an upward trend in recent years, but this still lags (4.1%), and Vietnam (6.3%). Moreover, the behind other developing countries.31 The most World Social Protection Report 2020–22 of recent Social Protection Index (SPI) Report of the International Labour Organization shows the Asian Development Bank (ADB) in 2019 that the country’s SP expenditure (2.6 of GDP) reveals that the country’s population-weighted is lower than the Asia-Pacific average and that expenditure on social protection (2.9% of of Malaysia, Thailand, or Vietnam. In terms of GDP) falls below the average weighted SPI coverage, the Philippines also remains below of 5.3 percent for Asia and 3.0 percent for the region’s average and that for Thailand Southeast Asia. The Philippines surpassed only and Vietnam (See Table 3.2.1). Indonesia (2.1%) among its neighbors, while the Table 3.2.1 Social Protection Coverage and Expenditure in Selected Countries SP Expenditure Excluding Health as Country SP Coverage of Population (%) Share of GDP (%) Philippines 36.7 2.6 Indonesia 27.8 1.3 Malaysia 27.3 4.2 Thailand 68 3.0 Vietnam 38.8 4.3 Asia & Pacific Average 44.1 7.5 SP = social protection. Source: International Labour Organization. 2021. World Social Protection Report 2020–22. Geneva. There is a need to continue addressing Indicator Survey (LFS–APIS) show that recurrent and new risks facing vulnerable households in the bottom 40 percent of the sectors and poor households. Several income distribution consistently registered marginalized and vulnerable sectors need lower SP coverage in 2017, 2019, and 2020 greater access to a variety of SP programs. (without the Social Amelioration Program While the Philippine SP system has programs [SAP] grants) than for all households that can address various risks, access to these (See Table 3.2.2). Their coverage only increased programs is largely uneven. Data from the in 2020 when the SAP grants were added.32 merged Labor Force Survey–Annual Poverty Table 3.2.2 Estimate of social protection coverage among households in the Philippines, 2017, 2019, and 2020 2017 2019 2020 2020 Households (%) (%) (without SAP)(%) (with SAP)(%) Bottom 40% 57.29 61.79 66.09 91.05 All Households 65.78 72.85 73.14 90.69 SAP = Social Amelioration Program. Sources: NEDA Social Development Services estimates; Philippine Statistics Authority. Various years. LFP-APIS. Quezon City. Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 89 There are population groups that would to be covered by SP programs either in the need special SP assistance because of their Philippines or in their host countries. special conditions or circumstances. Owing Modified SP programs are also needed by to their limited mobility, some persons with indigenous peoples and children who confront disabilities need government cash support for continuing political and governance concerns. their various expenses. The direct and indirect Child labor, children in street situations, costs of disability are diverse due to a range of children in conflict situations, and children in functional difficulties and health conditions conflict with the law, are only some of the social among persons with disabilities. These injustices that promotive and transformative costs will also be contingent on the level of SP programs need to address. accessibility and inclusiveness of the physical environment. Effective social protection must While social insurance covers all risks, also account for this diversity.33 coverage is uneven due to low awareness and high participation cost. The merged LFS–APIS Also in need of special social protection are data (See Figure 3.2.1) show that there is migrant Filipinos. According to the Department consistently less coverage among households of Foreign Affairs, only 88.9 percent of overseas from the bottom 40 percent while more than Filipinos are legally documented, which include half of households from the sixth to tenth temporary or resident-seeking migrants. They deciles have higher coverage.34 need to have proper visas and permits for them Figure 3.2.1 Households with at least one member covered by Social Security System, Government Service Insurance System, Private Life Insurance, and/or Health Maintenance Organization per income decile (%) 100 92.7 90 81.5 87.9 85.8 Percentage of households 80.2 80.4 80 73.4 71.5 78.6 68.9 70 67.7 65.0 61.2 60 55.0 57.9 53.3 57.8 51.8 50 44.6 45.4 46.4 42.6 39.1 40 37.2 36.4 31.7 30 29.3 27.5 23.3 20 12.1 10 0 1 2 3 4 5 6 7 8 9 10 Income Decile 2017 2019 2020 Note: Programs and/or facilities considered for 2017, 2019, and 2020: Government Service Insurance System (GSIS), Social Security System (SSS), Private Insurance, 4Ps, Social Pension Program for Indigent Senior Citizens, Sustainable Livelihood Program. For 2019 and 2020 only: Health Maintenance Organization (HMO), Unconditional Cash Transfer Program, Philippine Charity Sweepstakes Office, Individual Medical Assistance Program, Emergency Shelter Assistance. For 2019 only: Pantawid Pasada. For 2020 only: DSWD SAP, Tulong Panghanapbuhay Sa Ating Disadvantaged/Displaced Workers Program #Barangay Ko Bahay Ko, DA Rice Farmer Financial Assistance. Source: 2017, 2019, and 2020 merged data from Philippine Statistics Authority. Various years. LFP-APIS. Quezon City. 90 | Philippine Development Plan 2023-2028 The country continues to confront various index score of 46.82, the Philippines has the natural, health, climate, and human-induced highest disaster risk among 193 countries hazards. According to the National Disaster covered in the World Risk Report 2022. There Risk Reduction and Management Council are also new risks brought about by geopolitical (NDRRMC), the disasters in the Philippines conflicts, technological disruptions from the recorded 0.446 deaths, 0.024 missing persons; Fourth Industrial Revolution, and emerging and 4,558.95 directly affected persons per concerns due to changing climate patterns that 100,000 of the population in 2021. With an are rendering SP programs even more relevant. Strategy Framework The PDP 2023–2028 aims for the country’s (See Figure 3.2.2). Such a system will enable economic transformation toward a prosperous, Filipinos to manage individual or life cycle inclusive, and resilient society. To this end, risks, as well as those arising from economic implementing a rationalized and integrated uncertainties, natural or human-induced social protection system will be a key strategy hazards, or political circumstances. Figure 3.2.2 Strategy Framework to Strengthen Social Protection DEVELOP AND PROTECT CAPABILITIES OF INDIVIDUALS AND FAMILIES REDUCE VULNERABILITIES AND PROTECT PURCHASING POWER STRENGTHEN SOCIAL PROTECTION INDIVIDUAL AND NATURAL, HEALTH, CLIMATE, GOVERNANCE AND LIFECYCLE ECONOMIC RISK MANAGED AND HUMAN-INDUCED POLITICAL RISKS RISKS MITIGATED HAZARDS MITIGATED ADDRESSED Establish cash grants to cover Increase coverage and Further strengthen coordination and Integrate safeguards into disability costs and fully implement benefits of unemployment collaboration among NDRRMC, CCC, development interventions the mandatory membership and insurance schemes LGUs, and the private/CSOs Prepare anticipatory exclusive package in PhilHealth Ensure the implementation of mental shook-responsive plans for IDPs and Rationalize existing livelihood Strengthen implementation of laws health and psychosocial services in the POCs and public works/cash for work protecting women disaster response package Strengthen the implementation of programs implemented by various government agencies Establish permanent and resilient EO 163 (Protection Services for Assure SP access in GIDAs evacuation centers POCs); and RA 11188 (Special Ensure safe and orderly Expand coverage of free overseas migration agricultural insurance for qualified Strengthen SP programs and Protection of Children in Situations farmers and fisherfolk introduce relevant products in of Armed Conflict) responding to the pandemic and Implement a holistic approach Develop a comprehensive other health hazards. to eradicate child labor pathway for returning OFWs Implement and operationalize the Protect children from physical Adaptive Shock Responsive Roadmap and mental distress Develop and implement anticipatory delivery mechanisms for various types of disasters and emergencies A UNIVERSAL, MODERN, AND INTEGRATED SP SYSTEM ACHIEVED Establish a standard menu of rationalized programs for the SP floor guarantees Ensure a timely and responsive financing for SP programs in emergencies Implement an SP Communication Plan and Strategy Ensure the establishment and updating of social registries Create synergies among stakeholders in designing and delivering programs Promote financial literacy for better awareness and use of financial instruments (See Subchapter 11.1) Enhance and promote social insurance products to encourage coverage for all Filipinos Strengthen services and facilities for digital payments of cash transfers Enhance SP statistics guided by the approved framework Integrate the nutritional needs of vulnerable groups in SP program Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 91 Strategies To build the resiliency and adaptive capacity specific strategies that will protect vulnerable of the population, the government aims to groups from covariate and idiosyncratic provide a universal and integrated SP system, risks. Additional detailed plans responding to which can manage various present and future economic risks, natural, health, climate- and risks and shocks confronting Filipinos and human-induced hazards, and governance and re-engineered to link and enhance existing SP political risks are also laid out. systems. Part of the rationalized SP system are Outcome 1: A universal, modern, and integrated social protection system achieved Establish a standard menu of programs for Overseas Filipino Workers (OFW) rationalized programs for the social (i.e., study the overlap in the pension program protection floor guarantees of the Social Security System [SSS] and the programs of OWWA). Current SP programs shall be reviewed for possible overlaps, duplications, gaps, and Ensure a timely response and relevance, given the limited fiscal resources adequate financing for social and expanding needs for social protection. protection programs in emergencies For the same reasons, the possibilities for rationalizing, merging, or reorganizing some The government shall mobilize more resources SP programs shall also be explored. The for SP programs through closer coordination proposed package of programs for each SP with the private and civil society sectors. This floor guarantee will improve coordination is to ensure that there is adequate financing for among agencies and maximize impact for the SP responses during emergencies. With beneficiaries. Programs that are selected in the sufficient resources, the timely responses of SP package shall be strengthened at each stage— programs can be achieved. Improvements in from targeting, to enrolment, to delivery. the procedures for fund releases during these Innovative programs such as anticipatory times shall also be implemented. and adaptive (shock-responsive) programs Implement a Social Protection shall also be encouraged and mainstreamed. Communication Plan and Strategy An important component of this strategy is the institutionalization of monitoring and Limited and faulty information on SP and evaluation of SP programs. the role it plays in the country’s development remains a challenge for both service providers Among the programs that shall be reviewed are and the public. In addition, many citizens may those on emergency cash assistance, livelihood, still not be aware of the range of SP programs and social insurance. For example, there is scope that they can access. There is a need to widen for rationalizing the mandatory contributory 92 | Philippine Development Plan 2023-2028 information dissemination of these programs be inspired to pool their resources for the and the procedures for their availment. greater public good. Ensure the establishment and Promote financial literacy for better updating of social registries awareness and use of financial instruments Concerned agencies shall establish and update social registries for vulnerable groups. To According to the United Nation’s Financing for avoid gaps or overlaps, the registries of various Sustainable Development Report 2021, nearly government agencies and the national ID all (94%) of adults in developed countries system will be harmonized. This initiative and less than two-thirds (63%) of the same in will facilitate targeting, authentication, developing countries have bank accounts. In registration, and enlistment into SP programs. 2021, the Bangko Sentral ng Pilipinas reported Some registries shall also be linked with the that more than 36 million Filipinos (almost database of specific locations that will emanate half of all adults) did not have a bank account, from the community-based monitoring thus missing out on the benefits of having system for the delivery of benefits. Designing one, such as the fast, convenient, and secure new programs will also be facilitated given receipt of digital cash transfers from various these coordinated efforts. SP programs. Aside from having a bank account, the people’s awareness of financial Create synergies among instruments, such as savings and insurance, stakeholders in designing and could widen their options for protecting delivering programs themselves against adverse shocks and other Social protection is best pursued as a risks. National and local governments, in multi-stakeholder agenda to reach more partnership with the private and civil society people and increase impact. Thus, it requires sectors, shall ramp up efforts toward financial collaboration and coordination in the program literacy (See Subchapter 11.1). design and delivery among players across Enhance and promote social various sectors. National government agencies insurance products to encourage are not alone in delivering SP programs; coverage of all Filipinos often their initiatives are augmented by and undertaken in tandem with LGUs, Aside from conducting financial literacy which usually innovate their own program programs, the introduction of innovative deliveries.35 During the pandemic, the insurance products can be done through private and civil society sectors have piloted public–private–civil society sector partnerships “community pantries” and “soup kitchens” that (e.g., Card-Pioneer Crop Insurance for provided food for the hungry and capital for Farmers in partnership with the Philippine small restaurants.36 The national government Crop Insurance Corporation). Such products shall encourage and promote similar initiatives should be affordable and have flexible payment to reach more people in need. Through this schemes to cater to low-income households. whole-of-society approach, more sectors can Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 93 There is also a need to ensure physical and Enhance social protection statistics digital accessibility of service providers. guided by the approved framework Strengthen services and facilities for With an approved framework as guide, SP digital payments of cash transfers statistical indicators shall be enhanced. These indicators are critical for monitoring and With the advances in and adoption of evaluation of programs and evidence-based digitalization technologies, digital payment policy making in the sector. platforms will be increasingly used for cash transfers. SP programs that share their digital Integrate the nutritional needs platforms will result in greater efficiency of vulnerable groups in social and wider options for their beneficiaries. protection programs For example, when development partners Nutritional concerns shall be considered in utilized the 4Ps payment platform during the design of social protection programs and emergency responses, they were able to policies. The government shall ensure that reduce their administrative and transaction food provided to victims of disasters and costs significantly. beneficiaries of supplemental and school feeding programs are healthy, nutritious, and appropriate for their physical conditions and life stages. Outcome 2: Individual and life cycle risks mitigated Establish cash grants to cover Strengthen implementation of laws disability costs and fully implement protecting women the mandatory membership There is a need to strengthen the and exclusive package in the social health insurance program implementation of laws that protect women, (PhilHealth) (RA 11288) including Anti-Violence Against Women and Their Children Act of 2004, Safe Spaces The government shall provide disability Act, Anti-Trafficking in Persons Act of 2003, support allowance to persons with disability to Anti-Mail Order Spouse Act, and the Domestic enable them to defray part of the costs incurred Workers Act or Batas Kasambahay. Wider and due to their special conditions. To help them more effective dissemination in various media further, they will be extended mandatory of women’s rights, gender-based violence laws, membership coverage and appropriate and the available programs and facilities for PhilHealth benefit packages per RA 11288. women victims shall be undertaken. Both national- and local-level campaigns shall be organized to encourage women victims of violence to seek help from appropriate authorities and private organizations. 94 | Philippine Development Plan 2023-2028 Investigation and prosecutorial processes, Implement a holistic approach to prosecution, and case management processes, eradicate child labor including those for heinous crimes against A holistic and multi-stakeholder approach women, shall be streamlined. shall be implemented for key programs Assure access to social protection addressing child labor in the country; these programs in geographically isolated are expected to address the economic, social, and disadvantaged areas and psychological aspects of child labor. These programs will focus on current issues such as The national government, in coordination children in the informal economy and child with the LGUs, shall intensify the provision labor in its worst forms, including online of SP programs in geographically isolated and sexual abuse and exploitation of children. disadvantaged areas (GIDAs). This will also These initiatives entail the strengthening of entail the registration of indigenous peoples coordinative mechanisms and the provision in GIDAs in the PhilSys. The convergent of adequate resources to address the concerns delivery of services by all concerned agencies of affected families. These will also include the (e.g., basic infrastructure by the Department organization of referral pathways and strategic of Public Works and Highways [DPWH] helpdesks all over the country. and Department of Transportation) shall be undertaken (See Chapter 12). The government Protect children from physical and shall likewise tap NGOs and other civil society mental distress sectors that target people in GIDAs. Issues of street children, estimated at 369,242,37 Ensure safe and orderly overseas will be addressed through the Philippine migration National Multi-Sectoral Plan for Children in Street Situation 2021–2025 launched by the The government shall ensure that Filipinos Council for the Welfare of Children and its going overseas, whether as temporary migrant partners in 2021. RA 11188 was also passed to workers or seeking permanent residency respond to the needs of children in situations in host countries, will have proper and of armed conflict, and shall be continued. legal documentation. This will be possible Nutrition programs implemented nationwide through closer coordination specifically shall also be sustained to reduce the stunting among DOLE, Department of Foreign Affairs, and wasting of children. Mental health and Department of Migrant Workers, OWWA, psychosocial services shall also be provided and the Commission on Filipinos Overseas. to children, especially those who are left The government shall also strengthen behind by OFW parents, those in situations the enforcement of bilateral and regional of armed conflict, and in conflict with the law, agreements through better arrangements with as well as those who have experienced trauma host countries. during disasters. Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 95 Outcome 3: Economic risks managed Increase coverage and benefits of Expand coverage of free agricultural unemployment insurance schemes insurance for qualified farmers and fisherfolk The current programs by SSS and GSIS shall be reviewed, and alternative schemes to The government, through the DA, is reviewing increase coverage and benefits shall also be and updating the Registry System for Basic proposed. Implementation shall follow once Sectors in Agriculture to come up with a clean financial feasibility of the selected option list of beneficiaries for free insurance to be is confirmed. delivered by the Philippine Crop Insurance Corporation. Expansion of coverage shall Rationalize existing livelihood also be facilitated through an updated list and public works/cash for work and agricultural insurance products shall be programs implemented by various enhanced (See Chapter 5). government agencies Develop a comprehensive pathway Given the variety of livelihood and public for returning OFWs works and cash-for-work programs delivered by both national agencies The government shall review and reorganize (e.g., DSWD, DOLE, DPWH, and DA) the various programs available for OFWs into and local governments, basic guidelines and a coherent package. The intent is to chart the standards shall be set by a committee to be different options and opportunities available to composed of all agencies that have such them to resettle, retire, or rejoin the labor sector programs. The committee shall also rationalize as workers or entrepreneurs upon their return these programs by determining who among to the country. The Department of Migrant them will remain as implementers. Workers shall create a “one-stop shop” that will guide returning OFWs in their choice. Outcome 4: Natural, health, climate, and other human-induced hazards mitigated Further strengthen the coordination disaster risk reduction and management and collaboration among NDRRMC, shall be determined. This will encompass Climate Change Commission, local synchronizing such programs for prevention, government units, and the private mitigation, rehabilitation, and recovery. and/or civil society sector Ensure the implementation of mental The government shall tighten emergency health and psychosocial services in response by optimizing synergies of the the disaster response package various programs of key stakeholders. Common programs in the interconnected Learning from the country’s experiences fields of sustainability, climate change, and in disasters like super typhoons Yolanda 96 | Philippine Development Plan 2023-2028 and Odette, the government shall ensure capacities of concerned institutions, and the provision of gender-sensitive and implement pilot testing of integrated social child-friendly mental health and psychosocial protection approaches from regular and services to victims of disasters. ancillary programs and services in selected areas around the country. Establish permanent and resilient evacuation centers Develop and implement anticipatory delivery mechanisms for various To minimize the use of classrooms as types of disasters and emergencies evacuation centers during calamities, appropriate facilities shall be built to shelter the While the country is regularly confronted with affected families. Aside from being permanent disasters and emergencies, new technologies and typhoon- and earthquake-resilient, the for better forecasting have also been developed. evacuation centers shall be designed to cater As an example, the National Economic to the well-being of children, women, persons and Development Authority (NEDA) uses with disability, and the elderly. Geographic Information Systems in estimating the impact of location characteristics, and Strengthen social protection finds that landslide-prone areas are correlated programs and introduce relevant with lower household incomes, while products in responding to the moderate flooding risks are associated with pandemic and other health hazards higher household incomes.38 Using early Learning from the lessons during the warning mechanisms, the government shall pandemic, the government, in partnership implement anticipatory mechanisms and with the private sector, shall strengthen the shock-responsive social protection programs implementation of SP programs in responding to address emergencies. Such efforts can to a health shock or crisis, including the reduce shocks to household incomes and introduction and production of necessary casualties (e.g., deaths and missing persons) health-related products like protective personal due to disasters. equipment and vaccines that will be critical in the response. This will entail the coordination and collaboration of line agencies, including the DOH, DSWD, and DTI. Implement and operationalize the Adaptive Shock Responsive Roadmap The Adaptive Shock Responsive Roadmap has been adopted by the NDRRMC through Resolution No. 7, series of 2021. It aims to strengthen coordination mechanisms with inter-governmental agencies, raise the Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 97 Outcome 5: Governance and political risks addressed Integrate safeguards into of violence and conflicts. These will include development interventions establishing a dynamic registry, strengthening early warning and delivery systems, and It is inevitable that some development building local capacities of affected areas. The projects and reform policies will result in the Bangsamoro Autonomous Region in Muslim displacement of or negative outcomes for Mindanao has piloted such programs and some sectors in society. Thus, the government these can be replicated in areas with similar shall continue to ensure built-in safety nets situations. with adequate financing in such projects to compensate for or mitigate the impacts of such Strengthen the implementation of projects and policies on affected sectors. Executive Order 163, series of 2022 (Protection Services for POCs) Prepare and RA 11188 (Special Protection anticipatory shock-responsive plans of Children in Situations of Armed for internally displaced persons and Conflict) persons of concern The government shall increase efforts to The government will provide anticipatory provide the necessary human and financial programs that will address the needs of resources in the implementation of the new internally displaced persons IDPs and persons executive order and law. of concern (POCs) especially in situations Legislative Agenda Table 3.2.3 presents the priority bills of the 19th Congress to strengthen social protection. Table 3.2.3 Legislative Agenda to Strengthen Social Protection LEGISLATIVE AGENDA RATIONALE/KEY FEATURES RESPONSIBLE AGENCY Achieve a Universal, Modern, and Integrated Social Protection (SP) System Universal and Integrated The need for a legal framework that will rationalize SP programs toward an integrated Department of Social Social Protection System system where there is: Welfare and Development • Recognition of SP as a basic right provided by the state; and National Economic and • Institutionalization of SP floor; Development Authority • Establishment of effective coordination structures; • Establishment and updating of social registries; • Enhancement of digital payment platforms; and • Sustainable financing (See Subchapter 11.1) and partnerships with the private and civil society sectors Mitigate Individual and Lifecycle Risks Unified System of This bill seeks to provide an equitable and sustainable pension system for uniformed Department of Finance Separation, Retirement, personnel. It also intends to address the weakness in their current pension system such as and Pension automatic indexation, funding sources, and the need to adjust the pensionable age, among others. Disability Support The bill seeks to grant a cash subsidy to supplement incomes of households with persons National Council on Disability Allowance with disability. Affairs 98 | Philippine Development Plan 2023-2028 LEGISLATIVE AGENDA RATIONALE/KEY FEATURES RESPONSIBLE AGENCY Expansion of This will expand the coverage and benefits of unemployment insurance under the Social SSS, GSIS, Department of Unemployment Insurance Security System (SSS) and Government Service Insurance System (GSIS). Labor and Employment Mitigate Natural, Health, Climate, and other Human-Induced Hazards Evacuation Center Act This will establish permanent and typhoon-resilient evacuation centers with necessary National Disaster Risk facilities to avoid the practice of using classrooms during calamities. These centers will also Reduction and Management take into consideration in their design the welfare of children, women, persons with disability, Council and the elderly. Results Matrix Table 3.2.4 presents the indicators and targets for strengthening social protection. Table 3.2.4 Results Matrix: Strengthening Social Protection BASELINE ANNUAL PLAN TARGETS MEANS OF RESPONSIBLE AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION INTER-AGENCY BODY Intermediate Goal: Develop and Protect Capabilities of Individuals and Families Chapter Outcome: Reduce Vulnerabilities and Protect Purchasing Power Subchapter 3.2: Strengthen Social Protection 1. Percentage of 83.8 100 100 100 100 100 100 Annual Poverty Social Security System families covered with Indicators Survey (SSS), Government social insurance (%) (2020) Service Insurance System (GSIS), Philhealth, Philippine Crop Insurance Corporation 2. Percentage of 64.52 67.5 71.0 74.5 78 81.5 85.0 Listahanan Department of Social poor households with Welfare and Development members 18 years (2019) Latest (DSWD) old and below that Standardized are 4Ps beneficiaries Targeting System (%) Listahanan 2 3. Percentage of 60.27 62.98 63.74 64.20 65.41 65.84 66.53 SSS, GSIS, DSWD, SSS, GSIS, DSWD, National senior citizens who Philippine National Commission of Senior receive pension (%) (2021) Police (PNP) Citizens, PNP, Armed Pensioner Online Forces of the Philippines Accounting System admin data and Philippine Statistics Authority population projection 4. Percentage 88.9 Increasing Department of Department of Foreign of documented (2021) Foreign Affairs Affairs, Department Overseas Filipinos report of Migrant Workers, to total Overseas Overseas Workers Filipinos (%) Welfare Administration, Commission on Filipinos Overseas 5. Percentage 37 39-40 40-41 40-41 41-42 41-42 42-43 SSS admin data SSS of economically (2021) active population contributing to SSS (%) 6.Total expenditures 2.7 3.13 3.55 3.98 4.49% 4.83 5.25* Department National Economic and on social protection (2021) of Budget and Development Authority programs as Management data Social Development percentage of gross Committee domestic product* (%) *Average spending of Middle-Income countries on SP excluding health (Source: ILO, World Social Protection Report 2020-22) Chapter 3 Reduce Vulnerabilities and Protect Purchasing Power | 99 1 Food security index scores are classified as: (a) very good: 80–100; (b) good: 70–79.9; (c) moderate: 55–69.9; (d) weak: 40–54.9; and (e) very weak: 0–39.9. The index is constructed from 28 unique indicators that cover the four dimensions of food security (e.g., change in average food cost, access to agricultural inputs, volatility of agricultural production, dietary and diversity, nutritional standards, and exposure to risks). The 2022 Global Food Security Index Report was released in September 2022. 2 Scores ranged from 53.1 to 57.6. 3 Scores ranged from 60.1 to 73.1. 4 Based on the report from the Philippine Statistics Authority (PSA), the volume of production for the following commodities contracted in the first three quarters of 2022 relative to the same period of 2021: palay at –0.2 percent, sugarcane at –20.8 percent, tomato at –4.5 percent, cabbage at –4.2 percent, calamansi at –4.1percent, mango at –3.9 percent, banana at –0.9 percent, cassava at –0.3 percent, coffee at –4.5 percent, bangus at –13.3 percent, and galunggong at –3.2 percent, among others. 5 The decline in the production of sugarcane is attributed to the lingering effects of Typhoon Odette in December 2021, which affected new plantings and damaged the standing crop. Losses brought about by calamities (e.g., pest infestation, volcanic eruption, and typhoons such as the Tropical Cyclone Karding and Severe Tropical Storm Paeng) as of November 2022 had reached 533,178 metric tons (MT) for palay and 333,085 MT for high-value crops. 6 Subcluster of Health under the National Disaster Risk Reduction and Management Council (NDRRMC). This is composed of partner agencies from government, the United Nations, and non-government organizations (NGO), which guides the implementation and monitoring of programmatic measures to reduce nutrition- related mortality and morbidity because of emergencies (like COVID-19) and impact of disasters on public health, economy, and social aspects. 7 Created in January 2020, through Executive Order No. 101, with the objective of ensuring that government policies, initiatives, and projects on attaining zero hunger shall be coordinated, responsive, and effective. 8 A multi-sectoral movement founded to help eradicate hunger and malnutrition in the Philippines by 2030. It is the collective effort of the government, NGOs, the academe, and the private sector to address the root of the nation’s concerns on hunger—striving to improve food production and distribution, to repurpose food surplus to curb malnutrition, and to reduce hunger incidences caused by crises. 9 It was implemented in 2020 to 2021 with the following measures: (a) provision of cash and food subsidy to marginalized farmers and fisherfolk, (b) KADIWA ni Ani at Kita, and (c) urban agriculture and backyard gardening, among others. In 2022, the DA launched Plant, Plant, Plant Program 2, which comprises the following programs: (a) provision of fertilizer subsidy, (b) urban and peri-urban agriculture, (c) local feeds production, (d) aquaculture and mariculture fisheries, and (e) food mobilization. 10 Includes (a) DA’s Fuel Discount for Farmers and Fisherfolk Program; and (b) DSWD’s Targeted Cash Transfer Program and Assistance to Individuals in Crisis Situation. An Inter-Agency Committee—chaired by the Department of Finance (DOF) and co-chaired by the National Economic and Development Authority (NEDA) with the DSWD, Department of Budget and Management (DBM), Bureau of the Treasury (BTr), and Land Bank of the Philippines (LBP) as members— oversees the implementation of the Targeted Cash Transfer Program. 11 Enacted in 2018 with the aim to institutionalize the National Feeding Program to combat hunger and undernutrition among Filipino children. 12 Including the earmarked reserves of the ASEAN Plus Three Emergency Rice Reserve . 13 ABEMIS of the Bureau of Agricultural and Fisheries Engineering contains geotagged data on machineries and equipment provided, postharvest and logistics facilities established, and farm-to-market roads completed. 14 Daily price updates of various agricultural and basic commodities in major markets in the National Capital Region. 15 The Online Price Monitoring System of the DTI where consumers can check the prevailing prices of necessities and prime commodities that DTI is monitoring. 16 The LPCCs report to the National Price Coordinating Council (NPCC), which is chaired by the DTI. The LPCCs are composed of the governor or mayor of a specific province or municipality as the chairman and the DTI provincial director as the vice-chairman. Members include representatives from DA, Department of Health (DOH), Department of Environment and Natural Resources (DENR), Department of Transportation (DOTr), and NEDA; as well as consumers; agricultural producers; and representatives from the manufacturing, retail, and labor sectors . 17 A program and tool by the National Nutrition Council (NNC), which aims to identify causes of malnutrition and vulnerable people. 18 The Integrated Food Security Phase Classification or IPC is a set of tools and procedures that classify the nature and severity of food insecurity into five phases (minimal, stressed, crisis, emergency, famine); and chronic food insecurity into four levels (low chronic, moderate chronic, high chronic, very high chronic). 19 The DOH, through the Food and Drug Administration (FDA), establishes standards for processed food, drugs, and cosmetics. 20 The DA’s Bureau of Agriculture and Fisheries Standards develops standards for agriculture and agriculture-related products including fruits and vegetables and grains. The Bureau of Animal Industry, National Dairy Authority, National Meat Inspection Service, Bureau of Fisheries and Aquatic Resources, and Bureau of Plant Industry enforce food safety standards and regulations on food derived from animals, fresh fish and seafood, and plant foods. 21 The DTI’s Bureau of Philippine Standards formulates standards for food and other categories (e.g., building, construction, and transport products). It is mandated to develop, implement, and coordinate standardization activities in the country and works with DOH and DA on this area. 22 Pinggang Pinoy is a visual food guide that uses a familiar food plate model to convey the right food group proportions on a per-meal basis to meet adults’ or a particular group of individuals’ energy and nutrient needs. 23 Vitamin A-infused rice received approval for commercial propagation in July 2021. As of September 2022, the DA and Philippine Rice Research Institute (DA- PhilRice), in collaboration with the International Rice Research Institute, has commenced handing over the Golden Rice seeds to DA-PhilRice branch stations, partner agencies, seed growers, and farmers for planting in 38.45 hectares in the target sites as part of its deployment. 24 The triple burden of malnutrition refers to undernutrition, micronutrient deficiencies, and overweight. 25 Milk feeding program to community and school-based children, nourishment of pregnant women (e.g., Tutok Kainan), and day care and school children supplementation program, among others. 26 Micronutrient supplementation for all under-five and school children, including pregnant and lactating women, among others. 27 Albert, J.R, M. Abrigo, F. Quimba, and J. Vizmanos. 2020. “Poverty, the Middle Class, and Income Distribution amid COVID-19.” Discussion Paper Series No. 2020- 22. Quezon City: Philippine Institute for Development Studies. 28 Belghith (2021) cited in Cho, Y. and D. Johnson. 2022. COVID-19 and Social Assistance in the Philippines: Lessons for Future Resilience. Washington, DC: World Bank. See also Belghith, N. 2021. “Poverty and Distributional Impacts of COVID-19 Crisis.” Washington, DC: World Bank. Mimeo. 29 Gudmalin, C., L. Calina, J. Balbosa, J. Mangahas, and M. Samoza. 2021. Protecting the Poor and the Vulnerable Against the Pandemic. Tokyo: ADB Institute. 30 Cho, Y. and D. Johnson. 2022. COVID-19 and Social Assistance in the Philippines: Lessons for Future Resilience. Washington, DC: World Bank. 31 Sicat, C.J. and M.A. Mariano. 2021. A Public Expenditure Review of Social Protection Programs in the Philippines. Quezon City: Philippine Institute for Development Studies. 32 Social Development Services. n.d. “Policy Brief on Modernizing Social Protection.” Pasig City: National Economic and Development Authority. 100 | Philippine Development Plan 2023-2028 33 United Nations Partnership on the Rights of Persons with Disabilities. 2020. Considering the Disability-related Extra Costs of Social Protection. https://www. social-protection.org/gimi/RessourcePDF.action?id=56925. 34 Social Development Services. n.d. “Policy Brief on Modernizing Social Protection.” Pasig City: National Economic and Development Authority. 35 Some Galing Pook awardees are evidence of this—Cagayan de Oro City’s enrollment strategy for health insurance, the targeting mechanism of the municipality of Siayan in Zamboanga del Norte, and Tagum City’s public education and employment service office. 36 Project Karinderya was initiated by 18 foundations and NGOs. 37 This number comes from a Social Weather Stations–Lifebank Foundation Project in 2019 estimating the number of streetchildren in the country. 38 Social Development Services. n.d. “Policy Brief on Modernizing Social Protection.” Pasig City: National Economic and Development Authority. 04 Increase Income-earning Ability CHAPTER 4 Increase Income-earning Ability Increasing the income-earning ability of Filipinos involves developing the workforce and increasing their employability in the market, ensuring that skills are aligned not just with the current in-demand requirements but also with critical and emerging skills. Effective and efficient employment facilitation processes will also enable faster and more strategic job search. A vibrant social partnership, based on shared responsibility for achieving a responsive, fair, and efficient labor market, will also be crucial. By 2028, Filipinos will have enhanced income-earning ability that can better support their aspirations to have a stable and comfortable lifestyle, secure in the knowledge that they have enough for their daily needs and unexpected expenses. This chapter presents the challenges in increasing income-earning ability and the outcomes to be pursued to address these challenges during the Plan period. These outcomes are as follows: (a) employability increased, (b) access to employment opportunities expanded, and (c) shared labor market governance achieved. Assessment and Challenges The Philippines’ labor market from 2010 to In 2021, the labor force participation rate 2019 was vibrant, leveraging on advances in (LFPR) increased to 61.4 percent after policy execution. However, the coronavirus dipping to 59.5 percent in 2020. The LFPR disease (COVID-19) pandemic reversed improved further to 63.3 percent in 2022.2 its gains. In 2010–2019, net employment The unemployment rate eased to 8.0 percent generation (+7.9 million) outpaced the increase in 2021, decreasing further to 5.4 percent in in labor force (+6.8 million), raising real wages 2022. At the same time, the number of wage and productivity. In 2020, as the pandemic and salary workers has also been increasing, stalled economic activities, unemployment growing by 7.6 percent (+2.0 million) and rose to a high of 10.3 percent, leading to an constituting 63.2 percent of total employment additional 2.2 million workers unemployed. in 2022. However, the proportion of vulnerable In response, the government initiated the employment (i.e., self-employed and unpaid Philippine Program for Recovery with Equity family workers) to total employment remains and Solidarity and National Employment high at 34.1 percent in 2022. Moreover, Recovery Strategy, which provided health, underemployment persists, remaining mobility, and financial interventions to firms elevated at 14.2 percent in 2022 despite the and disadvantaged households. It served as improvement from 17.6 percent in 2021 and vital platforms for subsequent initiatives.1 16.2 percent in 2020. The labor market shows signs of recovery, Skills mismatch remains a concern despite but the quality of jobs remains a concern. the convergence of demand and supply Chapter 4 Increase Income-earning Ability | 105 structures. The skills demand associated with that the pandemic could weaken future labor the country’s economic structure and the skills market prospects of the younger workforce. supply reflecting the educational attainment of the workforce are slowly becoming As more return to school, the youth not in better aligned. In recent years, with rapid education, employment, or training (NEET) employment growth in high-skilled service rate shows signs of easing at 13.1 percent industries, manufacturing, and construction, year-to-date from 18.5 percent in 2020 and the oversupply of high-skilled workers at the 16.6 percent in 2021. The youth unemployment aggregate level was reduced. Nevertheless, rate also eased but remains elevated at a mismatch remains as the education and 12.6 percent from a high of 21.5 percent in training systems have yet to align with the 2020 and 16.6 percent in 2021. The youth skills demanded in the labor market. continue to face challenging employment prospects, resulting in persistent inactivity Employment continues to be disrupted rates in education, training, and employment.3 through the compounded effects of automation and climate change, rendering Emerging digital careers pose unique certain jobs and roles obsolete. The labor demands and challenges, especially in the market faces megatrends such as the Fourth fast-growing platform economy. Recent Industrial Revolution, climate change, and international assessments, such as the World the lingering COVID-19 pandemic. All the Digital Competitiveness Ranking 2022, megatrends have varying skill implications paint a weak country profile in terms of for the Filipino workforce. Year-to-date 2022 digital competitiveness and digital skills.4 data from the Labor Force Survey (LFS) show The Philippines lags behind its regional that 28.5 percent of employed workers are in peers in terms of foundational digital skills.5 elementary occupations, which are at greater Technological change continues to modify the risks of automation and digitalization. task content of jobs, leading to nonstandard work arrangements or increased demand for Although youth employability has improved, managerial, technical, and digital skills and full-cycle employment interventions still qualifications. The pandemic also marked need to be fully integrated. The COVID-19 a boom in the gig economy due to the shift crisis has resulted in multiple shocks for to digital platforms and increased reliance the youth—including disruptions in their on gig workers to home-deliver necessities education and training, employment, and to consumers. The gig economy offers earnings, and increased job search constraints. job flexibility that is more appealing and These shocks mark today’s youth as a “lockdown increasingly becoming necessary to workers. generation” and underscore the possibility 106 | Philippine Development Plan 2023-2028 Strategy Framework Figure 4.1 Strategy Framework to Increase Income-earning Ability DEVELOP AND PROTECT CAPABILITIES OF INDIVIDUALS AND FAMILIES INCREASE INCOME-EARNING ABILITY ACCESS TO EMPLOYMENT EMPLOYABILITY INCREASED OPPORTUNITIES EXPANDED Align development objectives for basic, TVET, and higher education based on labor market Integrate and strengthen all employment facilitation services, requirements including career development support Update contents of training standards, modules, and curricula for human capital development Strengthen technical capacity to develop dynamic and responsive based on emerging, in-demand, and hard-to-fill occupations in identified key employment labor market information systems generators Anticipate skills needs in priority sectors Develop modern and responsive TVET, apprenticeships, and higher education aligned with Intensify employment programs for the youth, marginalized, emerging trends or demands in the labor market disadvantaged, and vulnerable sectors Increase investments in TVET human resources, higher education, digitalization initiatives, and Develop programs and policies that address all forms of labor innovation facilities market discrimination in work, education, and training Develop and promote a national policy for lifelong learning Provide emergency employment and training support to displaced Establish skills assessment mechanisms and certification programs to recognize prior learning workers due to human-induced disasters and natural calamities Strengthen collaboration with industry boards and industry associations in TVET Maximize the utilization of PESO Align professional standards and licensure examinations with international standards Provide updated labor market information to PhilJobNet Strengthen government-private partnership on TVET Share and disseminate information on emerging, critical, and Increase awareness of PQF and PSF in-demand skills Intensify participation in youth employability programs SHARED LABOR MARKET GOVERNANCE ACHIEVED Harmonize skills development programs in the government Strengthen linkages and collaboration among government and industry associations, enterprises, and social partners to emphasize shared responsibility in promoting and implementing employment policies and strategies Advocate and strengthen tripartite and bipartite social dialogue Design mechanisms to ensure inclusive participation and equitable access to education and skills development programs Ensure effective and efficient use of existing tripartite wage and productivity mechanisms Mainstream gender and green competencies Integrate lifelong learning processes in human resource development programs Create awareness of TVET programs implemented by the government Actively participate in government-industry associations promoting and implementing employment and skills development policies and strategies Strategies The strategy framework (See Figure 4.1) to strengthen interventions that improve highlights the importance of educational access to employment opportunities. Lastly, it qualifications, training credentials, underlines the need to improve labor market skills, and competencies that enhance governance, with an emphasis on collaboration employability. It also emphasizes the need and shared responsibility. Outcome 1: Employability increased In light of the current and emerging challenges the current and future workforce can adapt in the labor market, the government will to the changing demands of the labor market. further strengthen its efforts to raise the These will be achieved through the following quality of human resources and ensure that strategies: Chapter 4 Increase Income-earning Ability | 107 Align development objectives for by key agencies to ascertain program basic, technical and vocational effectiveness and inform quality assurance education and training (TVET), and mechanisms. Skills standards, competency higher education based on labor market requirements assessments, and certification shall be benchmarked with international standards. Achieving curricular alignment informed The government shall improve the criteria by labor market trends and complex for admitting private technical vocational transformations in strategic sectors, can institutions (TVI) to ensure that new foster better learning outcomes and better programs match the complexities of sectoral school-to-work transitions. Skill formation economic transformation. Human resource is linked to a life-cycle process, not a static, development and planning improvements one-shot endeavor involving many factors shall be implemented to keep up with the that pertain to labor market conditions and demand for quality instruction. The feasibility policies, home and school environments, of establishing a market of competencies to parental education, investment propensity, address emerging skills needs in the short household resources, and constraints, to term shall be explored (See Subchapter 2.2). name a few (See Subchapter 2.2). Hence, a whole-of-society approach is needed to Develop modern and responsive TVET, apprenticeships, and higher enable Filipinos to possess competencies and education aligned with emerging qualifications, including green competencies trends or demands in the labor that enhance their capacity to achieve desired market employment and mobility outcomes and better respond to economic opportunities.6 Technical and vocational education and training shall focus on modalities emphasizing Update contents of training cost-effectiveness, incentive compatibility, standards, modules, and curricula and employability. The government shall for human capital development based on emerging, in-demand, and explore ways to incentivize the participation hard-to-fill occupations in identified of industry and private companies in TVET key employment generators programs, particularly enterprise-based training (EBT). Moreover, the government In developing training modules, the shall explore cost-sharing mechanisms government will consider the transferability between private firms and current and/or of skills. Common competencies in training potential employees when designing training regulations7 shall be upgraded, reflecting contracts. The government shall pursue the economic transformation. In other development of forward-looking systems that countries, occupational profiles already anticipate emerging skills and educational reflect interdisciplinary competencies qualifications and complement industry efforts (See Subchapter 2.2). to inform training regulation development A comprehensive assessment of key TVET (See Subchapter 2.2). programs, credentialing mechanisms, and company-based training shall be undertaken 108 | Philippine Development Plan 2023-2028 The government shall conduct policy reviews of scholarship funds intended for upskilling of enterprise-based modalities. In addition, the and reskilling. government shall advocate for amendments to Develop and promote a national existing apprenticeship law, which modernizes policy for lifelong learning applicable provisions of the Labor Code to enhance employability. Lifelong learning enables all citizens to adapt to social and technological changes. With Increase investments in TVET present vulnerabilities and uncertainties of human resources, higher education, digitalization initiatives, and the future, lifelong learning programs need innovation facilities to be informed of emerging trends, flexible yet connected, certifiable to standards, and Modernizing TVET facilities and enhancing industry-related (See Subchapter 2.2). educational qualifications, competencies, and skills are necessary to respond to the The life-long learning and skills ecosystem emergence of new competencies and skills hinges on operationalizing the Philippine demands due to economic and technological Qualifications Framework (PQF). Therefore, transformations (See Subchapter 2.2). the government will strengthen the PQF National Coordinating Committee The establishment of TVET Innovation and its governance structure, establish Centers has already started in some parts the PQF Secretariat, enable budgetary of the country. Regional TVET Innovation support mechanisms for institutionalized Centers will generate benefit streams for activities, implement pilot projects, develop regional economies. They can complement the monitoring and evaluation mechanisms, delivery of area-based-demand driven TVET and make necessary revisions to the PQF.8 programs, synergizing with countryside The national government shall also conduct digital learning initiatives by the Department studies to measure qualification progression of Information and Communications contributions to income-earning ability.9 Technology. The government shall promote the role of community training and employment The government shall sustain efforts to coordinators (CTEC) in monitoring and develop a master plan for institutionalizing addressing local skills needs. The government lifelong learning beyond formal education.10 shall also institutionalize CTEC to support It shall encourage local government units devolution strategies of the Technical (LGU) to plan and integrate lifelong learning Education and Skills Development Authority programs to transform their jurisdictions into (TESDA). learning communities.11 One important aspect of this initiative is that by institutionalizing The government shall enhance the quality governance mechanisms and awareness of TVET human resources by improving campaigns that advance lifelong learning qualification and competency requirements initiatives, LGUs can promote inclusive and updating training requirements. learning in the workplace and foster a culture Improvements in human capital profiles can of learning among its constituents. be achieved through increased utilization Chapter 4 Increase Income-earning Ability | 109 Increase awareness of the Philippine integrity of earned digital certificates or badges. Qualifications Framework and Coordination with micro-credential providers Philippines Skills Framework including companies, industry associations, Employers may proactively convey how online learning platforms, non-government changing workplace requirements should organizations, and international organizations be integrated into academic curricula and is also seen as imperative, together with the training regulations. Employers should utilize eventual integration of such micro-credentials the PQF Registry of Qualifications to better in the PQF and PSF. A competency-based plan staffing requirements and understand system will be developed through which how to design jobs. Incorporating PQF and workers and labor entrants are awarded Philippines Skills Framework (PSF) provisions micro-credential via training or recognition of and standards is needed to ensure industrial prior learning. transformation that is sustained by responsive Strengthen collaboration with human capital and skills development industry boards and industry strategies. Employers, industry organizations, associations in TVET and educational institutions may engage in Achieving lifelong learning and skills skills-occupations mapping to remediate skills development objectives across industries inadequacies and foster job mobility. can be facilitated by industry boards and Establish skills assessment industry associations. This can encourage mechanisms and certification more industry involvement in providing programs to recognize prior learning high-quality TVET and shaping globally Recognition of all types of learning and an oriented human resources. individual’s knowledge, skills, and experience Taking off from experiences in establishing can provide an opportunity for people to acquire tourism and construction industry boards, qualifications or credits without going through the national government shall organize a formal education or training program.12 industry boards13 in key or strategic sectors The key characteristics of micro-credentials identified by the National Technical include limited time engagement, which is Education and Skills Development Plan and potentially integral to formal qualifications, the PSF Initiative. It shall capacitate industry stackable, flexible, and coming in digital form. boards in skills anticipation, certification The government shall study the establishment design, and training regulation formulation. of a national micro-credentials marketplace as Industry boards and associations shall also part of emerging initiatives to promote lifelong work to establish professional standards for learning (See Subchapter 2.2). emerging occupations. Align professional standards Online learning has become one of the and licensure examinations with dominant ways to achieve competencies, so international standards a system must leverage available technologies that facilitate digital accreditation. Blockchain The labor mobility of professionals has been technology can be used to safeguard the driven by robust demand for talent overseas 110 | Philippine Development Plan 2023-2028 on account of skill-biased technological networks within select curricular areas to change. The government shall continue promote program efficiency and relevance, improving professional standards in all improve quality access, share information regulated professions and ensure that licensure about curricular design, and develop lifelong examinations are aligned with international learning processes. With government direction standards. The government shall maximize and guidance, key industry players may form the recognition of Philippine professions centers of training excellence to help adapt by benchmarking with international to changing industry conditions and address standards and improving the quality of emerging skills needs. education, training, and skills development Intensify participation in youth (See Subchapter 2.2). employability programs Strengthen public-private Educational institutions shall proactively partnership on TVET seek effective interventions or programs that While the government formulates policies promote employability, particularly those in that govern TVET programs and prescribe senior high school. Establishing partnerships acceptable qualities of TVI, greater between local state universities and colleges, participation of private TVI is needed to local universities and colleges, high schools, enhance the quality and effectiveness of and TESDA can improve the effectiveness of curricular delivery. Stronger partnerships area-based skills interventions. Moreover, between high-quality, better-capacitated, and the private sector can help design curricula, well-staffed TVI and the government may be institutionalize feedback mechanisms, and formed and sustained with the right policies provide orientations on recruitment strategies. and incentive systems. Private TVI may form Outcome 2: Access to employment opportunities expanded Ensuring that employment opportunities are potentially transition to offering a full range of made available and accessible to all workforce employment, career counseling, and training members is critical to the objective of services for specific in-demand skills through increasing income-earning ability. This shall a partnership with TESDA and educational be achieved through the following strategies: institutions. Moreover, the government shall integrate all employment program monitoring Integrate and strengthen all employment facilitation services, systems, career development support, and including career development labor market information systems in the support PhilJobNet to provide a complete employment journey for target clients. Returning Overseas With technical assistance from the Department Filipinos will also have access to these services, of Labor and Employment (DOLE), the Public facilitating their integration back to the Employment Service Offices (PESOs) can domestic economy. Chapter 4 Increase Income-earning Ability | 111 The PESOs can facilitate worker mobility and Strengthen technical capacity to inform national interventions. Strengthening develop dynamic and responsive linkages among PESO centers can create a hub labor market information systems of information exchange on best practices in Investing in dynamic labor market information employment facilitation. Information from systems (LMIS) will result in efficient a PESO network can be fed into a system information flow, better skills anticipation, capable of processing inputs for generating and competency forecasts. Timely delivery of labor market intelligence, allowing national labor market information services requires policymakers to rapidly assess local conditions forward-looking information systems. In during periods of national emergency.14 Labor addition, the government can leverage digital mobility can also be enhanced by creating a technology by mapping changing skills and PESO portal, highlighting the ability of PESOs qualifications, as well as identifying pathways to to facilitate labor reallocation across regions. improving competencies through a framework for classifying similar jobs or occupations. Such The government shall ensure that PESOs mapping could enhance job mobility. can deliver vital services mandated by local ordinances and national laws. In addition The PhilJobNet is envisioned as a to their employment facilitation or job one-stop-shop for labor market information, brokering function, PESOs implement key allowing employers to post vacancies, and legislative initiatives and programs such as the workers to search for jobs. As the premier First-Time Jobseekers Assistance Act15 and source of labor market information, the JobStart Philippines.16 PhilJobNet shall evolve into a real-time Maximize the utilization of public system that interconnects local labor market employment service offices information networks. Continued business engagement remains Provide updated labor market critical for improving the performance of information to PhilJobNet PESOs. To ensure the maintenance, expansion, Unregistered employers can consider and promotion of PESO services, increased enlisting as part of PhiljobNet to avail of the allocation of local budgets may be necessary. services, such that labor search costs can be Moreover, better utilization of PESOs would reduced and staffing needs can be addressed. result in improved facilitation efficiency and Moreover, the participation of employers visibility. To respond more effectively, LGUs can contribute to local development by can consider investing in digital platforms that enriching labor market intelligence. Linking automatically update the state of local labor to PhilJobNet improves the data quality and markets and highlight job trends. Similar ensures proper characterization of local labor platforms can also be made more responsive to market conditions. Industry associations can the needs of PESO constituents by facilitating also explore ways to reliably and securely link registration, access, and application. systems that continuously provide updates. 112 | Philippine Development Plan 2023-2028 Anticipate skills needs in priority systems can be helpful for firms to anticipate sectors and relay emerging skills requirements, inform educational, training, and skills policies, and With digital and economic transformations enhance market interventions, including in in key industries underway, demand for terms of timeliness. Moreover, employers, updated and new technical regulations, worker associations, and industry groups can job-aligned curricula, and training materials consider participating proactively in sectoral has increased. Identifying and anticipating bodies to facilitate the exchange of ideas and skills needed for priority sectors of the enhance communication flow. economy shall precede training decisions so that skills required are relevant for the Intensify employment programs labor market. For example, to align with for the youth, marginalized, the agricultural sector transformation, the disadvantaged, and vulnerable sectors government will anticipate and address the implications from mechanization, Technical and vocational education and diversification, bio-based inputs production, training can be promoted to address the high and waste management. As the transformation incidence of youth NEET. Forming tight in the industry intensifies, demand for social linkages between educational institutions, (collaboration and teamwork); cognitive skills development authority, and PESOs can (strategic problem solving, agility, and mitigate search frictions and mismatches, as adaptability); and specialized skills (data information on active labor market programs analysis, content creation, and storytelling) can be efficiently cascaded to education will be high. The reinvigoration of services providers. For example, the Special Program will also increase demand for a myriad of for Employment of Students can be reviewed cognitive, social, technical, transversal, to rationalize the targeting and selection of management, specialized, and other emerging grantees, and to align program outcomes skills or competencies. In the high-technology with lifelong learning objectives. In addition, sector, upskilling and reskilling initiatives can the JobStart Philippines program shall be focus on advanced manufacturing, robotics, intensified to accommodate more participants artificial intelligence, the Internet of Things, from disadvantaged, marginalized, and and blockchain. vulnerable groups. The Career Development Support Program, which aims to provide career Share and disseminate information on emerging, critical, and support to individuals, makes use of timely in-demand skills and relevant information on the dynamics of labor markets to address gaps in employability As technology transforms the workplace, the dimensions (i.e., personal and environmental government’s social partners shall update key factors, job search skills, skills gaps).17 stakeholders. For example, investing in private labor market assessment tools and information Chapter 4 Increase Income-earning Ability | 113 Develop programs and policies that Provide emergency employment address all forms of labor market and training support to displaced discrimination in work, education, workers due to human-induced and training disasters and natural calamities The government shall conduct impact Active labor market programs, such as assessments of policies, laws, and institutions emergency employment and training designed to promote equality. Besides support, are needed to build and enhance employment facilitation, policies shall resilience of displaced workers. Two notable be aimed at labor market issues such as active labor market interventions include gender, context-specific barriers, such the provision of emergency employment for as transportation constraints, security, displaced workers (Tulong Panghanapbuhay technological capacities, and discrimination. sa Ating Disadvantaged/Displaced Workers or TUPAD) and the Training for Work The government shall explore the development Scholarship Program. DOLE and TESDA of a framework that can progressively continue to roll out employment and national eliminate discrimination between full-time certification skills training packages to and part-time workers. Pathways shall also calamity-prone areas to ensure social safety be considered for workers transitioning from net and employment opportunities for part-time to full-time status or vice-versa. affected residents.18 Further, in connection with the implementation of livelihood training programs, DOLE and TESDA shall study the convergence of their livelihood training programs and community-based training programs, respectively, to avoid duplication. Outcome 3: Shared labor market governance achieved Attaining the objective of increasing cost-effective and optimal interventions. The income-earning ability is a shared creation of an inventory of all training programs responsibility among the government and shall pave the way toward the convergence social partners (i.e., private sector, civil of programs with similar objectives; thus, society organizations, academe, workers maximizing the impact of these programs organizations, and other stakeholders). on intended stakeholders. Impact evaluation This will be achieved through the studies to determine the degree of program following strategies: effectiveness and identify areas of reform shall be conducted. Harmonize skills development programs in the government Multiple skills development programs underscore the importance of designing 114 | Philippine Development Plan 2023-2028 Strengthen linkages and Tripartite sector skills bodies are important collaboration among government mechanisms for matching the sector demand and industry associations, for skills training, anticipating the future enterprises, and social partners to emphasize shared responsibility labor market, and addressing the adverse in promoting and implementing effects of digitalization, climate change, and employment policies and strategies globalization. To make LMIS more dynamic and forward-looking, the government shall Sustaining an education, training, and institutionalize systematic stakeholder lifelong learning ecosystem hinges on the engagement with social partners to focus dynamic interaction among social partners. on skills anticipation systems and policy The government shall sustain and strengthen development.19 partnerships with industry associations, workers’ organizations, and other institutions Design mechanisms to ensure to improve feedback mechanisms, promote inclusive participation and equitable innovative practices, complement efforts to access to education and skills development programs operationalize the PQF and PSF Initiative, improve skills anticipation and certification, Sustaining an education, lifelong learning, and deliver in-factory consultations and and skills ecosystem require responsive practical workplace training. Part of the and innovative policies and mechanisms to modes will include TESDA linkages with oversee programs and anticipate problems higher education institutions for courses to be or supply bottlenecks. The government shall offered in summer, wherein graduates will not remain proactive in formulating innovative just receive a baccalaureate degree but also a and effective interventions that enhance National Certificate, which in turn enhances income-generating ability throughout the their skills and employability, thereby worker’s life cycle, especially those of the enhancing their income-earning ability. vulnerable groups and communities. Thus, assessing the capacity of labor administration Advocate and strengthen tripartite and bipartite social dialogue to maintain such an ecosystem shall be prioritized. The government shall evaluate Transitioning from routine-biased to the mandate of the skills development skill-biased technological change has authority given an environment continuously considerable implications for working shaped by climate change, automation, and conditions, job tasks, and responsibilities. increased digitalization. With its social partners, the government shall update the social dialogue plan to emphasize Ensure effective and efficient use of existing tripartite wage and the role of megatrends such as digitalization, productivity mechanisms automation, and climate change, including how they affect the firm organization, The minimum wage shall be used to protect skill composition, qualifications, working the lowest and most vulnerable wage earners conditions, health, and safety. from poverty. Adjustments above the minimum wage shall be based on enterprise Chapter 4 Increase Income-earning Ability | 115 performance and labor productivity. In this stereotypes in basic and higher education regard, the government shall continue to materials, promoting entrepreneurship, and provide technical assistance to workers and advancing economic opportunities for women, enterprises in designing and implementing through harnessing digital technologies. productivity-based incentive schemes to Integrate lifelong learning processes increasingly link workers’ compensation and in human resource development labor productivity. programs Mainstream gender and green Employers are enjoined to recognize prior competencies learning outcomes obtained in micro-formal Climate change affects the future world of or formal training and provide relevant work and greening the economy will inevitably training to employees. Integrating lifelong create new jobs that can abolish other jobs. learning processes ensure that both employers Therefore, the government shall intensify and employees benefit from learning dividends creating a database of green jobs, implement in the form of better corporate performance, the Green Jobs Human Resource Development productive employee engagement, and Plan, and intensify the integration and enhanced well-being. mainstreaming of green competencies in Create awareness of TVET programs TVET and education programs. Furthermore, implemented by the government to achieve consistency, the government shall revisit the PQF for proper integration The TVI can formulate marketing strategies of environmental sustainability and green to promote jobs that only TVET programs qualifications as an objective. render achievable. For example, within TVI networks, participants may need to organize Key stakeholders shall ensure stability in the skills fairs or competitions, showcasing macroeconomy, adequacy of investments in technical capabilities and other attributes. green sectors, feasibility of creating green Moreover, TVI can create digital platforms ecozones, and sustainability of human capital that popularize TVET programs, focusing investments. Because of job dynamics in on sustaining the economy’s ability to cater identified green sectors, adequate levels of to emerging skills. More importantly, TVET social protection shall be in place to address programs shall be projected as vital initiatives the just transition of unskilled workers. As for advancing the country’s economic interests economies become more involved in greening and development. processes and structures, those who belong Actively participate in to brown occupations may need assistance government-industry associations transitioning to other occupations. promoting and implementing employment and skills development While the country’s female LFPR has been policies and strategies slowly improving from the previous years, Social partners can participate in there is still a need to intensify efforts, such capacity-building programs sponsored by the as addressing gender bias and gender role 116 | Philippine Development Plan 2023-2028 government. Such programs help develop assessment and understand the implications skills needed for sustaining engagement of megatrends such as automation, climate in social dialogues and solving problems. change, and the ongoing pandemic on industry Social partners shall also be independently or sector outcomes. able to undertake comprehensive sector Legislative Agenda Table 4.1 presents the priority bills of the 19th Congress to increase income-earning ability. Table 4.1 Legislative Agenda to Increase Income-Earning Ability LEGISLATIVE AGENDA RATIONALE/ KEY FEATURES RESPONSIBLE AGENCY Revised National Harmonize the existing EBT modalities and expand the provision of training programs being Technical Education and Skills Apprenticeship Program; implemented within companies which can be a mix of workplace training and classroom- Development Authority (TESDA) Enterprise-Based based learning. Education and Training to Institute further reforms on the apprenticeship program to make them more attractive Employment Act to both the enterprises and the prospective apprentices, promoting skills acquisition and youth employment. Jobs Creation Strategy Bill Create an Inter-Agency Council for Jobs and Investments co-headed by the Department DOLE of Trade and Industry, Department of Labor and Employment (DOLE), and TESDA, with representatives from employers’ organizations and labor groups; and establish working groups that will focus on developing employment recovery and job creation in specific industries and emerging sectors, such as but not limited, to construction, tourism, agriculture, information technology and business process management, and manufacturing. Lifelong Learning Develop a Lifelong Learning Development Framework through the Philippine Qualifications DOLE Development Bill Framework–National Coordinating Council (PQF-NCC). The PQF–NCC shall determine and set standards for developing action components and desirable success measures for promoting lifelong learning in cities, municipalities, and educational institutions. Enterprise Productivity Fortify the intentions of the “Productivity Incentive Act of 1990” by promoting inclusive and DOLE Act (Amendments to sustainable work productivity programs. The Act aims to reinforce labor productivity by: Productivity Incentives Act) (a) establishing a Productivity Incentives Committee; (b) adopting productivity incentive programs; (c) granting productivity incentives to employees; and (d) providing a tax incentive to business establishments for granting incentives to employees. Results Matrix Table 4.2 presents the indicators and targets to increase income-earning ability. Table 4.2 Results Matrix: Increase the Income-Earning Ability ANNUAL PLAN TARGETS RESPONSIBLE MEANS OF AGENCY/ INDICATOR BASELINE 2023 2024 2025 2026 2026 2028 VERIFICATION INTER-AGENCY BODY Intermediate goal: Income-earning ability increased Outcome 1: Employability Increased Proportion of employed 2.7 1.50–1.73 1.50–1.73 1.50–1.73 1.50-1.73 1.50–1.73 1.50–1.73 Labor Force Social college graduates in (2020) Survey (LFS) Development elementary occupations Committee (SDC) (%) decreased Percentage of youth 12.6 12.8– 12.5–14.5 12.2–14.2 11.9–13.9 11.6–13.6 11.3–13.3 LFS SDC not in employment, (average for 14.8 education, or training Jan, Apr, Jul, (%) reduced Oct, 2022) Chapter 4 Increase Income-earning Ability | 117 ANNUAL PLAN TARGETS RESPONSIBLE MEANS OF AGENCY/ INDICATOR BASELINE 2023 2024 2025 2026 2026 2028 VERIFICATION INTER-AGENCY BODY Technical Education 92 92 92.5 93 93.5 94 94.5 TESDA Data TESDA and Skills Development (2021) Authority (TESDA) certification rate in priority sectors (%) increased Employment rate of 93.4 94–96 94–96 95–96 95–96 95–96 95–96 LFS SDC TVET graduatesa (%) (average for increased Jan, Apr, Jul, Oct, 2022) Proportion of 71.4 72.3 73.0 73.8 74.53 75.3 76.1 LFS SDC employment in (average for middle- and high- Jan, Apr, Jul, skilled occupations (%)b Oct, 2022) increased Number of training 81 89 98 108 119 131 144 TESDA TESDA regulations, curricula, (2021) and courses with green core competenciesc increased Outcome 2: Access to Employment Opportunities Expanded Female labor force 51.7 51.0– 51.5– 52.0– 52.0– 52.0–54.0 52.0–54.0 LFS SDC participation rate (%) (average for 53.0 53.5 54.0 54.0 increased Jan, Apr, Jul, Oct, 2022) Placement rate (%) 91 91 91 91.2 91.3 91.4 91.5 DOLE data DOLE of public employment (Sep. 2022) service offices increased Percentage of 38.0 35–37 35–37 35–37 30–35 30–35 30–35 LFS SDC educatedd unemployed (average for to total unemployed (%) Jan, Apr, Jul, reduced Oct, 2022) Outcome 3: Shared Labor Market Governance Achieved Percentage of 12 10–12 10–12 12–15 12–15 15–17 15–17 DOLE data DOLE total number of (2021) establishments (%) provided with technical assistance that installed or enhanced productivity performance-based incentive schemes Percentage of trained 69 69-70 69-70 70-75 70-75 70-75 70-75 DOLE data DOLE micro, small, and (2022) medium enterprises (%) that implemented productivity improvement program a Baseline figure is computed using the identified post-secondary graduates from the LFS. b Excluding elementary and armed forces occupations based on the definition of International Labour Organization. ILOStat Variable Levels. https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fwww.ilo.org%2Filostat-files%2FISCO%2Fnewdocs-08- 2021%2FISCO-08%2FISCO-08%252088%2520EN%2520Skills%2520.xlsx&wdOrigin=BROWSELINK c Number of training regulations and competency standards with green competencies, including newly developed and reviewed. d Includes those with college education (undergraduates and graduates). 118 | Philippine Development Plan 2023-2028 1 In 2022, Senator Joel Villanueva proposed Senate Bill 129 (19th Congress) known as the Trabaho Para sa Lahat Bill. This Senate Bill institutionalizes the National Employment Action Plan, which is an offshoot of the NERS. 2 Fiscal year 2022 figures are based on the quarterly LFS result, i.e., January, April, and July 2022. 3 See Orbeta et al. 2021. ”Who Are the Youth NEET in the Philippines Today?” Discussion Paper Series No. 2021-21. Quezon City: Philippine Institute for Development Studies. 4 The Philippines (rank: 56) lags behind Indonesia (51) and Thailand (40). See IMD World Competitiveness Center. 2022. World Digital Competitiveness Ranking. https://www.imd.org/centers/world-competitiveness-center/rankings/world-digital-competitiveness/. 5 See pages 14–15 in Department of Information and Communications Technology. Connect, Harness, Innovate, and Protect Implementation Plan. Quezon City. 6 Based on the definition of employability in Chapter 2 of International Labour Organization (ILO). 2021. Shaping Skills and Lifelong Learning for the Future. Geneva. 7 Training regulations serve as the bases for developing competency-based curricula and instructional materials as well as competency assessment tools. They define the competency standards for national qualifications. 8 The World Bank. 2021. A Review of the Philippine Qualifications Framework: Toward Improved Skills Recognition and Mobility. Washington, DC. https:// openknowledge.worldbank.org/entities/publication/40da4689-9f8a-58b6-bac0-5005d6fe03b9. 9 See Daquio. 2021. Differentiation of Pay Scales Across Levels of TVET Qualifications in the Construction Industry. 10 One of the main objectives of Senate Bill No. 129 is establishing learning cities and municipalities. 11 This strategy is similar to Germany’s Learning Regions Promotion of Networks, which later became the Learning in Place program. Both programs are designed to transform cities and/or regions into learning cities and/or regions. 12 See ILO. 2018. Recognition of Prior Learning (RPL): Learning Package. Geneva. 13 See Technical Education and Skills Development Authority. 2021. Implementing Guidelines for Pilot Implementation on the Establishment of Industry Boards. TESDA Circular No. 017, s. 2021. Taguig. 14 This is one of the objectives of the proposed Senate Bill No. 49 authored by Senator Jinggoy Ejercito Estrada. 15 The First Time Jobseekers Assistance Act seeks to help first-time jobseekers secure pre-employment documents that will lessen their financial burden in obtaining said documents. 16 JobStart Philippines is designed to provide opportunities to at-risk youth, who are provided with life skills training, career guidance and coaching, technical internships, and training with private sector employers. 17 See ILO and European Training Foundation. 2021; Koeltz and Torres. 2016; and Fasrul and Torres. 2021 18 See Department of Labor and Employment–Technical Education and Skills Development Authority. DOLE-TESDA Joint Memorandum Circular No. 001-2022. 19 See Chapter 4 of ILO. 2021. Shaping Skills and Lifelong Learning for the Future. Geneva. Chapter 4 Increase Income-earning Ability | 119 PART III Transform Production Sectors to Generate More Quality Jobs and Competitive Products 05 Modernize Agriculture and Agribusiness CHAPTER 5 Modernize Agriculture and Agribusiness Recognizing that the agriculture, forestry, and fisheries (AFF) sector is part of a bigger agri-food system, the Plan will be guided by transformative ideas, which will involve (a) addressing the systemic ills of AFF through a whole-of-value-chain approach that considers AFF production as tightly linked to processing, marketing, consumption, and waste management; (b) restoring the local food culture toward improving agri-food system resiliency, empowering local farmers, and linking AFF production to consumer nutrition and health of the environment; and (c) opening up more opportunities in the blue economy to leverage and optimize the country’s vast coastal and marine resources and maritime domain. In the next six years, sound agricultural development through holistic agri-food system measures espoused in the National Agriculture and Fisheries Modernization and Industrialization Plan (NAFMIP) 2021-2030 will be pursued, with the ultimate objective of raising the level of income of primary producers (i.e., farmers and fisherfolk) beyond the poverty threshold. This chapter presents the challenges facing agriculture and agribusiness, and the outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) efficiency of agriculture, forestry, and fisheries production enhanced; (b) access to markets and agriculture-, forestry-, and fisheries-based enterprises expanded; (c) resilience of agriculture, forestry, and fisheries value chains improved; and (d) agricultural institutions strengthened. Assessment and Challenges The existing agri-food system has been natural and biological hazards (e.g., pandemic, dysfunctional in serving its basic roles in Avian Influenza [AI], and African Swine Fever (a) generating decent income for the sector’s [ASF]) and global economic headwinds. These stakeholders, particularly primary producers; may also further weaken the sector’s poor (b) ensuring sustainable use of natural economic performance in the previous Plan resources; and (c) providing for the health period. As of the third quarter of 2022, AFF and nutrition of consumers and nurturing the only grew by 0.8 percent. local food culture (See Subchapter 3.1). The sector’s sustainability is also threatened by While the country has made some progress unsustainable farming and fishing practices in reducing poverty prior to the pandemic, that deplete the resource base (terrestrial, primary producers remain to be the poorest coastal, and marine) and exacerbate among the basic sectors.1 The previous gains pollution, amidst a changing climate may be further eroded as the sector bears the (See Chapters 2.3 and 15). The AFF production brunt of multidimensional shocks arising from relies on natural capital as inputs, especially Chapter 5 Modernize Agriculture and Agribusiness | 125 land and water resources; at the same time, it of the Department of Agriculture (DA) contributes to its degradation. For instance, undermines the significance of developing agricultural run-off continues to be one of the technologies and disseminating sustainable major non-point sources of water pollution.2 farm and fishery management practices. The country’s land degradation hotspots cover 1,910,478 hectares (ha), resulting from • Low access to credit and insurance, unsustainable farming practices that affect particularly among smallholder primary soil quality, among other factors. Further, the producers, due to challenges emanating agri-food system is one of the major sources from both the supply and demand side. of greenhouse gas emissions, contributing to Supply-side challenges on formal credit global warming. Meanwhile, the inability of for the sector include: (a) limited physical the agri-food system in meeting the country’s network of banks and other formal lenders nutritional requirements emanates from a in rural areas; (b) perceived high risks in lack of scientific knowledge about human agriculture due to lack of familiarity or nutrition. The result is an unsustainable understanding of agricultural markets and consumer behavior that has high preference for borrowers as well as frequent occurrence consuming low nutritional value commodities of extreme weather events; (c) inadequate and imported products. institutional capacity of lenders which limits assessment of the sector’s projects These challenges contribute to the following for financing and designing of suitable inefficiencies along various segments of the loan products. On the other hand, value chain, which continue to hamper the demand-side constraints include: (a) high potential of the country’s agriculture and borrowing costs due to distance from agribusiness sector: bank; (b) weak financial literacy among borrowers; (c) inability to prepare • Low farm/labor productivity. The financing proposals and documentation Philippines is still considered to have a low requirements; and (d) lack of collateral, level of mechanization at 1.23 horsepower especially for the agrarian reform (hp)/ha for all crops.3 While there have beneficiaries (ARB) still under collective been some improvements in the level Certificate of Land Ownership Award of mechanization for rice—from 2.31 (CLOA). Moreover, agricultural insurance hp/ha in 2011 to 3.77 hp/ha in 2019— provision is limited, mainly due to the the country still lags behind our Asian minimal participation of private insurance neighbors.4 This indicates that primary companies and the low awareness of production is still greatly dependent on primary producers on the available risk manual labor, which is inextricably linked insurance products and the benefits of to poor adoption of modern agricultural availing them. and fishery technologies and limited extension services. In addition, the low • Unsustainable farming practices share of AFF research, development, and and underutilized agro-forestry and extension (RDE) programs in the budget blue economy potential. Land-based 126 | Philippine Development Plan 2023-2028 agriculture is still largely characterized the perceived risks of the private sector in by monoculture and low adoption investing in agriculture. of improved technology. Most of the country’s agricultural land areas are • Inadequate infrastructure. Investments devoted to the production of traditional on public goods for the AFF sector have been crops, such as palay (32%), coconut inadequate or have not been rationalized, (24.3%), and corn (17.1%).5 Meanwhile, which aggravate the challenges related subsistence farming and poor market to high logistics and marketing costs access in upland areas hinder the country’s and huge postharvest losses. Moreover, agro-forestry output. With respect to irrigation investments were mainly coastal and marine resources, illegal, focused on areas geared toward rice-based unreported, and unregulated fishing production systems. There has been low continues to be a challenge. Moreover, support for small-scale irrigation needed designated mariculture parks offering in high-value crops (HVC) production.7 opportunities for greater fisheries Further, many existing irrigation systems production remain underutilized.6 require rehabilitation or restoration to improve efficiency and retrofitting to • Weak export performance. The value of ensure climate resiliency (See Chapter 15). AFF exports declined by 13.9 percent in September 2022 compared to the same • Fragmentation of agricultural lands. period in the previous year. The lack of While the total number of farms increased diversity in the country’s AFF exports, by two-thirds, the average farm size fell which comprise mostly raw materials from 3 ha in 1980 to 0.9 ha in 2012 due and semi-processed products, makes it to the redistribution of lands under the susceptible to disruptive changes in the Comprehensive Agrarian Reform Program market and price volatility. (CARP) and transactions/activities involving non-CARP lands (particularly, • Weak investments in the AFF sector. the sale of these lands), among other Total investments in the AFF sector factors.8 Property rights still needs to be contracted by an average of six percent settled, with almost half of the ARBs still annually from 2017 to 2022. This stems covered by collective ownership certificates. from the prevailing challenges in the Insecure property rights contributed to sector which erodes investor confidence. limited on-farm investments and farmers’ These include high logistics cost, lack of access to support services. scale of local raw material suppliers, and low conformance of primary producers • High vulnerability to multidimensional to local and international standards. shocks. The geographical location and Further, the incomplete land ownership physical environment of the Philippines transfer—with a significant balance of make it susceptible to typhoons, lands under collective ownership—adds to earthquakes, and volcanic eruptions, among others, causing huge damage and Chapter 5 Modernize Agriculture and Agribusiness | 127 losses to the agriculture sector. Rising boats). Also, the inadequate and outdated temperature also threatens the AFF sector data (e.g., mechanization, investments in due to its effect on the physiology and AFF, and catch per unit effort) and limited reproduction of pests. In recent years, the interoperability of management information sector has also been greatly affected by the systems hamper evidence-based planning disruptions in supply chains due to the and programming, thereby affecting our (a) imposition of community quarantines to ability to bring about transformative changes limit the spread of COVID-19; (b) ongoing in the sector. conflict between Russia and Ukraine which has raised prices of fuel, feeds, and Nevertheless, policy reforms have been fertilizers, driving inflation in our key enacted to make the sector more resilient and food commodities (See Chapters 3.1 and competitive both in the country and abroad. 15); and (c) other shocks emanating from These include the (a) Rice Tariffication Law domestic armed conflict and territorial (RA 11203); (b) Coconut Farmers and Industry disputes (See Chapter 13.1). Trust Fund Act (RA 11524); (c) Sagip Saka Act (RA 11321); (d) Free Irrigation Service Weak governance and convergence among Act (RA 10969); (e) Sugarcane Industry agricultural institutions/rural development Development Act (RA 10659); (f) Agriculture, agencies further aggravate these challenges. Fisheries, and Rural Development Financing The implementation of policies, programs, Enhancement Act (RA 11901); (g) Agricultural and projects has been complex and difficult and Fishery Mechanization Law (RA 10601); considering the large DA bureaucracy.9 Limited and (h) Agricultural Free Patent Reform convergence with other government agencies— Act (RA 11231). Moving forward, the DA’s including the Department of Agrarian Reform programs and projects will build on the holistic (DAR), Department of Environment and approach to AFF development as embodied Natural Resources (DENR), Department in the NAFMIP and other road maps for the of the Interior and Local Government major AFF sectors (e.g., National Irrigation (DILG), Department of Trade and Industry Master Plan). The DA also established (DTI), and Department of Science and fisheries management areas and developed the Technology (DOST)—led to a fragmented and Integrated Marine Environment Monitoring unresponsive approach toward agricultural System to ensure that fisheries production is development. Exacerbating these issues is the within ecological limits. Further, the rise of inadequate interface between DA and local digital technology facilitated greater access of government units (LGU), which affected farmers to financial services as well as markets the implementation of devolved agricultural for inputs and products. This plan will build functions, including support and extension on these positive developments to formulate services, infrastructure support, and regulatory strategies to address the dysfunctionalities of mechanisms (e.g., registration of fishing the existing agri-food system. 128 | Philippine Development Plan 2023-2028 Strategy Framework The Plan pursues a whole-of-society enterprises, and improving the resilience of approach in modernizing agriculture and AFF value chains. This will be complemented agribusiness, emphasizing the crucial role of with strategies to strengthen agricultural both the government and private sector in institutions that will enable the modernization enhancing the efficiency of AFF production, of the country’s agriculture and agribusiness. Figure 5.1 expanding access to markets and AFF-based Figure 5.1 Strategy Framework to Modernize Agriculture and Agribusiness TRANSFORM PRODUCTION SECTORS TO GENERATE MORE QUALITY JOBS AND COMPETITIVE PRODUCTS MODERNIZE AGRICULTURE AND AGRIBUSINESS EFFICIENCY OF AGRICULTURE, ACCESS TO MARKETS AND RESILIENCE OF AFF FORESTRY, AND FISHERIES (AFF) AFF-BASED ENTERPRISES EXPANDED VALUE CHAINS IMPROVED PRODUCTION ENHANCED Diversify farm and non-farm income Create opportunities for the participation Create and adopt climate- and disaster-resilient of primary producers in value adding of technologies Consolidate/cluster farms AFF products Strengthen local food systems Create and facilitate adoption of Develop the blue economy improved technology Develop and mainstream early warning Improve physical and digital infrastructure systems/anticipatory mechanisms Improve access of primary producers to production requirements (e.g., land, Improve the regulatory system for greater Integrate climate and disaster risks in AFF water, renewable energy, and credit) private sector investments planning and programming Develop innovative insurance schemes Protect local AFF against unfair competition and supply/price manipulation Boost local capability on the production of AFF inputs AGRICULTURAL INSTITUTIONS STRENGTHENED Improve coordination and convergence of government agencies in planning, programming, and budgeting Enhance support to agricultural education and job-skills matching Strategies Outcome 1: Efficiency of AFF production enhanced Diversification of income sources will be Diversify farm and non-farm income intensified, economies of scale through farm Diversification opens possibilities for consolidation and clustering will be pursued, integration and intensification. This will and innovative technologies will be adopted help in ensuring the efficient use of land, to enhance efficiency of resource use and water, capital, and human resources, thereby improve the sector’s productivity. increasing farm income, creating more full-time jobs, and generating higher wages. This will involve diversifying commodities and Chapter 5 Modernize Agriculture and Agribusiness | 129 production activities to include value-adding Create and facilitate adoption of and other sources of farm and non-farm improved technology incomes. This entails the (a) operationalization Modernization is geared toward shifting the of various integrated farming systems and source of productivity from natural resources commodity system-based planning approach to knowledge (technology). The adoption of in the production of food and non-food modern production technologies responsive commodities, value-adding, and other to the needs of primary producers shall be segments of the value chain; (b) cascading AFF scaled up (See Chapter 8) to reduce the threat planning tools at the regional and provincial of diseases, increase sustainability and yield, levels; and (c) scaling-up value chain analyses and reduce the overall cost of operation. Such to guide and ensure strategic interventions. technologies will include location-specific, Consolidate/cluster farms sensor-based, and precision agriculture to optimize the use of production inputs in This strategy involves contiguous farming a sustainable manner; smart greenhouses; and operational consolidation of farms, labor, and controlled environment agricultural and other inputs, and thereby take advantage techniques. Thus, public-private partnerships of economies of scale in production. Farm will be deepened to address the weak spot— consolidation will facilitate greater adoption of the “last mile” of technology delivery—by efficient mechanization practices. Buying inputs increasing investments in RDE for biological, in bulk and consolidating produce will improve physical, and digital technologies, establishing the market power of smallholder primary more innovation hubs and demonstration sites, producers, leading to lower input prices and and strengthening the Province-led Agriculture higher profits. Labor consolidation builds and Fisheries Extension System (PAFES). on the traditional bayanihan practice in the country. To achieve these, the government will: Improve access of primary producers (a) strengthen support for bridging institutions, to production requirements such as cooperatives and farmers associations, For land resources, digital technologies as channels for technology diffusion; and will be harnessed to hasten the titling of (b) institutionalize at the level of smallholder collectively-owned land and supports programs primary producers the implementation of farm for sustainable use of forestlands (e.g., through and fisheries consolidation and clustering in the agro-forestry) and ancestral lands. At the same programs and projects of rural development time, the protection of indigenous peoples’ agencies. The DA and DAR will also continue (IP) rights, knowledge, and practices shall be to promote private sector engagement with ensured. In terms of improving and protecting smallholder primary producers through access to water resources, the following are agribusiness venture agreements and sugar prioritized: (a) investing in climate-smart block farms, among other modalities. irrigation technologies (e.g., solar-powered irrigation systems, drip irrigation, and water-efficient varieties of crops); (b) climate retrofitting of existing irrigation and drainage 130 | Philippine Development Plan 2023-2028 systems; (c) designing and managing flexible coverage of innovative financing schemes and durable irrigation systems for different and processes for smallholder primary farming systems; (d) incentivizing rainwater producers (e.g., crowdsourcing, digital harvesting; (e) recycling domestic water banking, and DA-Agricultural Credit Policy for irrigation purposes at household and Council’s credit programs);10 (b) increasing community levels; and (f) fully operationalizing the physical network of banks and financial the fisheries management areas (FMA), institutions in rural areas; (c) facilitating data especially the convening of FMA management sharing among banks and formal financial bodies and developing and implementing the institutions to gain granular knowledge of fisheries management plans. Simultaneously, the financial services needs of the sector; and there will be greater utilization and composting (d) intensifying agricultural guarantee services of farm and non-farm wastes and biological and establishing more credit surety funds to materials, such as palm sap, wood waste, and mitigate risks faced by financial institutions Napier grass, as energy and fertilizer sources. in extending unsecured loans to farmers and fisherfolk. Moreover, the sector’s access to capital will be further increased by (a) expanding the Outcome 2: Access to markets and AFF-based enterprises expanded Create opportunities for the growing); and (d) strengthening the capacity participation of primary producers in of smallholder primary producers to process value-adding of AFF products raw materials, understand markets, and ensure that food safety and quality standards The primary producers will be assisted to are met. To expand opportunities for deviate from traditional volume-oriented and upland communities, agroforestry and single-commodity approach and practices the establishment of commercial forest which limit the output of farms. To this end, plantations will be intensified. Commercial value-adding activities of primary producers forest plantations within integrated forest will be intensified by (a) piloting toll-based management agreements, community-based processing facilities and investing in these forest management agreements, and applicable through build-operate-transfer schemes; areas in ancestral domains will be developed (b) developing domestic industries to use based on comparative advantage and local materials for packaging (e.g., bamboo, ecosystem-based management approaches seaweeds) and to fabricate farm and (See Chapter 15). These activities will also processing machinery and equipment; expand livelihood and entrepreneurial (c) expanding business partnerships between opportunities that can be made available and the private sector and primary producers accessible for vulnerable groups—particularly (e.g., small brother-big brother arrangements, women, IPs, and the youth—and increase their block farms, private sector-led contract participation along the value chains. Chapter 5 Modernize Agriculture and Agribusiness | 131 Develop the blue economy use of planning tools and information systems, such as the Agricultural and Biosystems Recognizing the country’s geography, history, Engineering Management Information and culture, which suggest that more of System and Geographic Information System the nation’s wealth rests on its coastal and for Agricultural and Fisheries Machinery marine resources, DA, DTI, DENR, DOST, and Infrastructure (GEOAGRI) Portal.11 and other relevant agencies, will emphasize These are geared toward (a) building more and allocate the needed resources to harness and improving the interconnectedness of the full potential of the blue economy multimodal transport and logistics, especially (See Chapter 15). This will be attained through: those required for perishable products; (a) full implementation of FMA plans and (b) upgrading processing, postharvest, establishment of reference points and harvest and storage facilities with emphasis on control rules and measures for priority fish cold chain technology, including the species; (b) promotion of viable livelihood operationalization of community fish landing options for coastal communities to address centers across the country; (c) establishing the seasonality of fisheries, including adaptive, sustainable infrastructures, such as green integrated, and multi-species aquaculture, ports; (d) integrating and improving the engagement in agri-tourism activities, and interoperability of AFF information systems other supplemental livelihood programs for to harness the Fourth Industrial Revolution fisherfolk and coastal communities (e.g., salt technologies (e.g., big data, block chain, and production); (c) establishment of electronic Internet of Things); and (e) promoting and catch documentation and traceability for strengthening the capacity of farmers and sustainable fisheries (e.g., tuna); (d) upgrading fisherfolk to use mobile- and web-based of Technology Outreach Stations and National platforms for marketing, payment, and Technology Centers and greater investments product delivery (e.g., Co-opBiz,12 e-KADIWA, in hatcheries, mariculture parks, and feed GCash). The DA will also strengthen priority mills; (f) addressing the lack of modern AFF digitalization projects, including the ship and port facilities and other barriers to National Farmers and Fisherfolk Registry efficient inter-island transport and shipping System (NFFRS)13 and the Agribusiness (See Chapter 12); and (g) adoption of measures Portal,14 among others. to secure the access of local fisherfolk to the country’s fishing grounds (See Chapter 13.1). Improve the regulatory system for greater private sector investments Improve physical and digital A regulatory system necessary to modernize the infrastructure agri-food system should put in place enabling Physical and digital infrastructures policies and institutions conducive for private (See Chapter 12) have the demonstrated ability sector investments (See Chapters 10 to 14). to improve the efficiency of the agri-food Relevant government agencies, together with system while reducing its adverse impact on the the private sector, shall focus on (a) adopting environment. The government will rationalize global standards for product safety and investments in AFF infrastructure through the quality and business practices; (b) facilitating 132 | Philippine Development Plan 2023-2028 the entry of foreign investment and talents; Protect local AFF against unfair and (c) promoting partnerships between competition and supply/price foreign and domestic investors. Supporting manipulation these interventions is the strengthened The government will strictly enforce measures implementation of Ease of Doing Business intended to minimize or stop illegal and unfair and Efficient Government Service Delivery practices that disincentivize local farmers Act (RA 11032) (See Chapter 10). and investors such as smuggling, hoarding, dumping, and other forms of unfair practices (See Subchapter 3.1). Outcome 3: Resilience of AFF value chains improved Create and adopt climate- and about human nutrition, provide some disaster-resilient technologies guarantee of a match with the biological needs of the local population. Thus, investing in local To minimize the impact of climate change food systems will help ensure food security by and disasters, more investments for RDE reducing food costs, shortening food miles, on climate-resilient technologies and creating local employment, and fostering pride nature-based solutions will be pursued in the country’s food heritage. In addition, (See Chapter 15), including but not limited to RDE on indigenous species and varieties of improved varieties and breeds of plants and plants and breeds of animals and promoting animals, water-saving irrigation systems, soil traditional food culture through active erosion control technologies, and controlled advocacy and formal and informal education environment crop production systems. shall be prioritized. The government will also Alternate wetting and drying method and the institute policies to encourage investments in use of decentralized renewable energy in AFF growing, processing, marketing (domestic and production (e.g., solar, biological, and wind) international), and consuming nutritious and shall also be intensified. safe local dishes (See Subchapter 3.1). Strengthen local food systems Develop and mainstream early Local food systems are shaped by geography, warning systems/anticipatory ecology, and culture. They are composed mechanisms of diverse species of plants, animals, and Systems for prediction of disasters involve microbes that are uniquely adapted to the hazard estimation and weather forecasting local environment and have been found, (See Chapter 15). Some existing technologies through constant trial and error, to be optimal have achieved a level of granularity in terms of for the nutrition and health of consumers. spatial information needed in a highly diverse Local food systems are then least vulnerable Philippine geography. Thus, the government to international supply chain disruptions and, will further invest and continue the localization in the face of imperfect scientific knowledge and deployment of these technologies to Chapter 5 Modernize Agriculture and Agribusiness | 133 guide primary producers in making decisions Develop innovative insurance (e.g., time and place of planting/fishing). schemes To ensure risk-informed management of With the need to mitigate losses and ensure multidimensional shocks, the government speedy recovery from natural and economic will (a) mainstream the use of technologies shocks as well as outbreak of pests and (e.g., remote sensing) to predict supply chain diseases, the Philippine Crop Insurance disruptions; (b) adopt site-specific, timely, and Corporation (PCIC) will implement index- simplified climate outlook (e.g., La Niña and and weather-based insurance schemes to El Niño updates) and weather forecasts that provide adequate and timely compensation can be easily and readily adopted by primary to primary producers. Greater digitalization producers; (c) improve biosecurity measures of insurance programs will also be pursued and strengthen facilities/efforts to prevent for faster transactions and provision of and control outbreaks of transboundary indemnity payments. plant and animal diseases (e.g., ASF, AI, and banana fusarium wilt); and (d) accelerate the Boost local capability on the development of vaccines to control livestock production of AFF inputs and poultry diseases. The ongoing Russia-Ukraine conflict Integrate climate and disaster risks highlighted the risk of dependence on in AFF planning and programming international trade for AFF inputs. Increased prices of fertilizers, fuel, and other inputs have The DA will integrate the results of the driven food inflation and low production. Climate Risk and Vulnerability Assessment Investments in the domestic production of in agri-fishery plans and programs and AFF inputs will be intensified along with intensify the use of tools, such as Sustainable creating local business opportunities for Land Management, Expanded Vulnerability the sector to lessen dependence on foreign and Suitability Assessment and Value Chain sources and reduce supply chain disruptions. Analyses for commodity prioritization. This covers the local development of seeds, Further, the DA, in partnership with relevant propagating materials, tools, and machinery, agencies (e.g., DOST, Climate Change as well as bio-based fertilizers, pesticides, Commission, National Disaster Risk Reduction and packaging materials for manufacturing and Management Council), will train planners industries (See Chapter 6). The DA will also on the use of available tools for integration of ensure sufficient buffer stocks of seeds and climate and disaster risks (e.g., hazard maps) other planting materials to mitigate the in AFF plans, programs, and projects. Local impacts of global economic shocks. climate change trends and projections will also be considered in the construction of disaster- and climate-resilient farm structures and retrofitting of existing ones (e.g., small-scale irrigation systems). 134 | Philippine Development Plan 2023-2028 Outcome 4: Agricultural institutions strengthened Improve coordination and Education and Skills Development Authority’s convergence of government agencies (TESDA) skills needs assessment to guide in planning, programming, and training and other capacity building activities budgeting for primary producers. This focuses on (a) restructuring and To hasten the land titling process, the following reorganizing DA to enable a more efficient will be pursued: (a) finalization of the Joint implementation of AFF plans and programs at Administrative Order (JAO) between DAR and the national and local levels; (b) filling the gaps National Commission on Indigenous Peoples in services (e.g., “last mile” delivery of extension on the parcelization of collective CLOA in services); (c) reinvigorating the National ancestral domain; and (b) implementation of Convergence Initiative and including the DTI the JAO between DAR and Land Registration in its composition; (d) streamlining public RDE Authority on the processing period for the support system and addressing duplications generation, issuance, and registration of among relevant agencies; (e) rationalizing land computerized CLOA titles. administration and management functions; and (f) completing and regular updating of registry Enhance support to agricultural and information systems to provide reliable education and job-skills matching data sources that will assist the government in This strategy includes (a) improving the identifying investment gaps and making sound responsiveness of job and skills matching and data-driven decisions. programs through the participation of industry Agricultural cooperatives will also be in formulating curricula in agri-fishery schools; strengthened by enhancing the coordination (b) redeveloping education and training services mechanisms between the DA and Cooperative by adopting needs-based capacity development Development Authority, with the DA programs for small farmers and fisherfolk assuming a greater role in steering the needed and micro, small, and medium enterprises; development interventions to organize and (c) capacitating schools for teaching smallholder farmers and link them with modern agri-fishery in the context of agri-food investors. This strategy also ensures horizontal systems, with focus on innovations for best and vertical coordination and multi-sectoral and modern techniques and applications as approach in the delivery of devolved extension well as commercialization of modern farming services, given the Supreme Court ruling on the and fishing technologies (See Subchapter 2.2). Mandanas-Garcia case. This covers capacity Moreover, to help in improving the quality of and competency-enhancing interventions life of primary producers, the government will for the national and local agriculture pilot-test flexible work arrangements to ease extension workers and collaborative training labor regulations, especially in rural areas. This engagements with other stakeholders will further enable primary producers to get (e.g., private sector and academe). This additional sources of income from other sectors. further covers the completion of the Technical Chapter 5 Modernize Agriculture and Agribusiness | 135 Legislative Agenda Table 5.1.1 presents the priority bills of the 19th Congress to modernize agriculture and agribusiness. Table 5.1.1 Legislative Agenda to Modernize Agriculture and Agribusiness LEGISLATIVE AGENDA RATIONALE/KEY FEATURES RESPONSIBLE AGENCY National Land Use Act This is to establish a national land use framework that will (a) define the Department of Environment and Natural indicative priorities for land utilization and allocation across residential, Resources (DENR), Department of Agrarian infrastructure, agricultural, and protective uses; (b) integrate efforts, monitor Reform (DAR), Department of Trade and developments related to land use; and (c) evolve policies, regulations, and Industry (DTI), Department of Public Works directions of land use planning processes. and Highways (DPWH), Department of Transportation, Department of Tourism, Department of the Interior and Local Government (DILG), Department of Justice, Department of Energy, Department of Human Settlements and Urban Development, local government units (LGU) Consolidating land This will improve land administration and management services for agricultural DAR, DENR, Land Registration Authority administration and and non-agricultural lands. This will also contribute to fast-tracking the management functions distribution of individual titles under the Comprehensive Agrarian Reform (CARP). Increasing Idle Land Tax This is to promote the productive use of idle lands, even if temporary, but Department of FinanceFinance (DOF), DILG, without prejudice to the rights of owners to security of tenure. LGUs Soil and Water This aims to promote the adoption and implementation of Sustainable Land Department of Agriculture (DA) Conservation Act Management programs, projects, and activities for further prevention of land degradation through various soil and water conservation technologies and approaches, including rainwater harvesting. New Agrarian This aims to free Agrarian Reform Beneficiaries from the debt burden through DAR Emancipation Act the condonation of unpaid principal amortization payments for the lands awarded under CARP. Farm-to-Market Road This seeks to institutionalize the Farm-to-Market Road Development Program DA, DPWH Development and and funding commitment. This is to improve the Philippine barangay road Acceleration network to serve the needs of the Philippine Food Systems transformation (See Chapter 12). Strengthening the This aims to provide additional funding for provincial LGUs to incentivize them DA, LGUs agricultural extension in investing in and/or improving the provincial agri-fishery extension system. system This builds on the draft Executive Order institutionalizing the Province-led Agriculture and Fisheries Extension Systems and mandating its implementation across all provinces. Amendments to the This aims to increase the authorized capital of the bank for better funding LBP Landbank of the assistance in government programs for primary producers. This will also Philippines (LBP) Charter enable LBP to operate as a government financial institution responsible for broad-based agricultural and rural development as well as financial inclusion. Livestock, Poultry, and The proposed law aims to (a) improve the availability and affordability of DA, DILG, LGUs Dairy (LPD) Development nutritious and safe LPD products; (b) pursue better government response to and Competitiveness Act pests and diseases; and (c) increase the incomes of LPD and corn farmers. Amendment of the Rice There is a need to amend PD 194, which places a time limit for foreign DA, DTI and Corn Law (Presidential companies to operate as 100% foreign-owned entities, to attract foreign Decree [PD] No. 194) investments in the agriculture sector. Amendment of Section 61 The proposed law aims to improve efficiency and transparency in the trade DA of the Fisheries Code of of fishery products that would reduce trade costs and enable the timely 1998 (Republic Act 8550) importation of fish to augment domestic production in cases of supply deficiency. Strengthening the This aims to strengthen and expand the agricultural insurance provision by the DOF, PCIC, DA Philippine Crop Insurance PCIC to protect farmers and fisherfolk from losses and damage brought about Corporation (PCIC) by natural calamities. Young Farmers and This aims to (a) encourage the youth to pursue a career or engage in activities DA, DTI, DepEd, Department of Science Fisherfolk Challenge Act related to agriculture; (b) ensure participation of young farmers and fisherfolk and Technology, Commission on Higher in policy formulation and program implementation relative to the agriculture Education, DAR, Technical Education and Skills sector; and (c) provide institutional support for agribusiness and agri- Development Authority, DILG, Department of entrepreneurship initiatives of the youth to realize fully their role as agents Information and Communications Technology, and partners for development. DENR, National Youth Commission, LGUs 136 | Philippine Development Plan 2023-2028 Results Matrix Table 5.1.2 presents the indicators and targets during the Plan period to modernize agriculture and agribusiness. Table 5.1.2 Results Matrix: Modernize Agriculture and Agribusiness ANNUAL PLAN TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION INTER-AGENCY BODY Chapter Outcome: Agriculture and Agribusiness Modernized Growth in Average Family Income 27.1** --- --- 20.0- --- 20.0- -- Family Department of of Skilled Agricultural Workers or (2015-2018) 30.0 30.0 Income and Agricutlure (DA), Farm Laborers and Fisherfolk* Expenditure Department of (%) Survey Agrarian Reform (DAR), local government units (LGU) Growth in agriculture, forestry, 0.8 1.8-3.3 1.8-3.3 1.8-3.3 1.8-3.3 1.8-3.3 1.8-3.3 Philippine DA, LGUs and fisheries (AFF) gross value (Q1-Q3 Statistics added (GVA) increased (%, in 2022) Authority (PSA) constant prices) Macroeconomics Accounts Ratio of high-value crops (HVC) 21.0 21.3 21.7 22.0 22.4 22.8 23.1 PSA DA GVA to Total AFF GVA increased (2021) Openstat (%) Level of Mechanization improved Rice (hp/ha) 3.77 --- --- 4.2 --- --- 4.6 DA-PhilMech DA (2019) Study Outcome 1: Efficiency of AFF production enhanced Growth in AFF labor productivity -8.7 2.3-5.5 2.3-5.5 2.3-5.5 2.3-5.5 2.3-5.5 2.3-5.5 PSA Labor DA, DAR, LGUs increased (%) (2021) Statistics Outcome 2: Access to Markets and AFF-based Enterprises Expanded Growth in the total value -24.0 10.0 10.0 10.0 10.0 10.0 10.0 PSA Investment of approved investments in (2021) Openstat Promotion agribusiness increased (%, in Agencies real terms) Growth in the value of -13.9 6.4 6.4 6.4 6.4 6.4 6.4 PSA DA, Department agriculture and fisheries exports (Sep 2022) Trade of Trade and increased (%, free on board Statistics Industry value) Outcome 3: Resilience of AFF Value Chains Improved Proportion of primary producers 33.4 37.6 38.9 45.7 48.1 50.8 53.3 Philippine Crop PCIC covered by agricultural (2021) Insurance insurance to total number of Corporation primary producers registered (PCIC) in the Registry System for Basic Sectors in Agriculture increased (%) * Income of families whose household head is engaged as Skilled Agricultural Workers or Farm Laborers and Fishermen ** Baseline and targets will be updated upon the release of the official 2021 data from the Family Income and Expenditure Survey in the 1st quarter of 2023 Chapter 5 Modernize Agriculture and Agribusiness | 137 1 Based on the data from the Philippine Statistics Authority (PSA), poverty incidence among farmers has decreased from 40.8 percent (2015) to 31.6 percent (2018). It has decreased among fisherfolk from 36.9 to 26.2 percent in the same period. 2 NEDA. (2021). Socioeconomic Report. 3 Based on the latest data reported by DA-Philippine Center for Postharvest Development and Mechanization (PHilMech) 4 Data from the 2019 study of the Bureau of Agricultural Research and University of the Philippines Los Baños as reported by DA-PhilMech and Bureau of Agriculture and Fisheries Engineering 5 Based on the PSA OpenSTAT 2021 data. 6 The DA-Bureau of Fisheries and Aquatic Resources reported that there are 67 operational mariculture parks, 48 of which are non-operational. 7 From 2014-2022, only about PHP1.2 billion was funded out of the PHP3 billion proposed budget of the High Value Crops Development Program for small-scale irrigation. 8 World Bank. (2021). Realizing Scale in Smallholder-Based Agriculture: Policy Options for the Philippines. 9 It comprises eight bureaus, eight attached agencies, eight attached corporations, and 16 regional offices. Several attached agencies and corporations are created for a particular commodity (e.g., National Food Authority, Sugar Regulatory Administration, and Philippine Coconut Authority). 10 Production Loan Easy Access, Survival and Recovery Loan, Kapital Access for Young Agripreneurs, and Agri-Negosyo Loan Program, among others. 11 GEOAGRI is an interactive web mapping application that displays information on Farm-to-Market Road (FMR) projects. 12 Co-opBiz is an online platform for transaction and delivery of agricultural products of cooperatives; e-Kadiwa is an online marketing platform that directly links producers and agripreneurs to consumers, wherein agricultural produce can be bought simply using a mobile phone or computer and can be paid via cash-on- delivery or bank transfer. 13 The NFFRS is the flagship digitalization project of the DA. It is an online application used to update the Registry System for Basic Sectors in Agriculture. It aims to be a reliable source of data and information to be used as basis/ reference in the implementation of various AFF programs as well as the formulation and evaluation of policies. 14 The online Agribusiness Portal is composed of the e-Kadiwa platform (e-commerce), Price Monitoring System (Bantay-Presyo App), Commodity Trade Volume Watch System, and the Farmers and Fisherfolk Enterprise Development Information System. 138 | Philippine Development Plan 2023-2028 06 Revitalize Industry CHAPTER 6 Revitalize Industry To generate more quality jobs and competitive products, the industry sector will be revitalized by expanding the domestic market and supplier base, moving up the value chain, and enhancing linkages across sectors. Moreover, to drive industrialization forward, accessibility, particularly of micro, small, and medium enterprises, to a dynamic science, technology, and innovation ecosystem will be ensured. This chapter presents the challenges to revitalizing industry and the outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) domestic market production and supplier base expanded, (b) moving-up the value chain achieved, (c) competitiveness improved, (d) dynamic industry ecosystem created, and (e) inter-sectoral linkages enhanced. Assessment and Challenges Before the coronavirus disease (COVID-19) manufacturers have shown resilience, growing pandemic, the Philippines had a growing at 5.8 percent in 2019-2020 despite the industry despite structural weaknesses. lockdowns. Electricity, steam, water, and waste Despite difficulty in attracting foreign direct management sector also showed a minimal investments (FDI), restrictions to foreign decline of 0.4 percent in 2019-2020 despite equity and the lack of advanced science, prolonged periods of community quarantine. technology and engineering skills, industry showed a strong performance from 2010 to Businesses have turned to digital tools, 2019, growing at an average of 6.4 percent especially for marketing and payments annually. This growth was driven by robust during the pandemic, evidenced by the growth in construction (10.0%); electricity, significant growth in e-commerce. Driven by steam, water, and waste management strict lockdowns as well as a tipping point in (5.7%); and manufacturing (5.6%) over the the adoption of certain digital services, the same period. Philippines’ 2021 Gross Market Value (GMV) reached a total of USD17 billion—a notable COVID-19 reversed industry performance. 93 percent year-on-year (y-o-y) surge. This The imposed lockdowns have wiped away steep increase is underpinned by a 132 percent the gains from previous years, resulting growth in e-commerce. In addition, 39 percent in the contraction of the industry sector of digital merchants believe that they would not (–13.1%) with construction (–25.5%), and have survived the pandemic if not for digital mining and quarrying (–18.6%) reporting platforms. Digital merchants are reported to double-digit declines. have used an average of two digital platforms in that year.1 Yet, we have seen some bright spots in the midst of the pandemic. Pharmaceutical Chapter 6 Revitalize Industry | 143 In the first half of 2022, economic recovery Still, certain industry sectors are already has become more broad-based as many considering adopting modern technologies. industry subsectors have surpassed Food manufacturers are exploring the pre-pandemic performance. Electricity, applications of artificial intelligence (AI), the steam, water, and waste management (9.9%) Internet of Things (IoT), and synthetic biology have exceeded pre-pandemic growth. For (plant-based alternatives for meat products). the manufacturing sector: wood, bamboo The Semiconductor and Electronics Industries cane, and rattan (31.3%); chemicals (29.1%); in the Philippines Foundation, Inc. is also paper (19.2%); furniture (13.3%); electronics optimistic about the opportunities that will (8.9%); food products (4.9%); and fabricated be provided by emerging technologies, such metals (4.2%) have all reported production as metaverse, automotive AI, advanced driver expansions higher than their 2019 figures. assistance systems, and augmented reality.5 Recovery can also be seen in the rebound Rapid global inflation is clouding the of employment generation. Employment outlook for sustained manufacturing generated in the industry sector totaled growth. The Philippine manufacturing 446,000 in January–May 2022, indicating a sector is projected to take a hit from high high likelihood that the full-year 2022 target global inflation mainly brought about by the of 200,000 will be surpassed given sustained prolonged Russia–Ukraine conflict. While economic growth momentum. Manufacturing domestic demand may have continued to contributed about 52 percent to employment sustain the domestic manufacturing sectors, generation in industry, followed by the rising import cost of inputs and fuel prices, construction at 41 percent. and the slowing down of manufacturing activity in major economies6 may be a drag Looking forward to the next 5 years, challenges on the domestic manufacturing sector. The to industry development remain but also Purchasing Manager’s Index (PMI), declining opportunities abound. from 54.1 in May 2022 to 52.6 in October Philippine manufacturing continues 2022, has already shown indications of slowing to have low technology utilization with manufacturing activity. most companies2 still transitioning from The constraint placed by international Industry 2.0 to Industry 3.0.3 In addition, sanctions on Russian export of cobalt, a key micro, small, and medium enterprises input in the production of batteries, provides (MSME) in manufacturing have, at most, opportunities for the Philippine mining and low technological readiness for the Fourth manufacturing industries. The Philippines and Industrial Revolution or Industry 4.0. Most Russia have roughly similar amounts of cobalt MSMEs admitted that they are not yet ready for reserves and fall within the top six country revolutionary changes in their organizations, sources of cobalt, after Australia, Cuba, the citing top barriers to technology utilization Democratic Republic of Congo, and Indonesia. such as the high cost of technologies, lack of Although the Philippines produces nickel-cobalt infrastructure, absence of skilled employees, mixed with sulphide, the opportunity to add and lack of management knowledge.4 value and produce nickel sulphate (needed by 144 | Philippine Development Plan 2023-2028 lithium ion battery producers) in the Philippines vis-à-vis Malaysia, Thailand, Vietnam, and has yet to be taken. Prolonged sanctions on Indonesia.8 However, in order for Philippine Russian cobalt will likely increase investors’ firms to adopt new technologies to become interest in the Philippines.7 more competitive, it is critical to expand their absorptive capacity, which requires developing Competitive cost of labor, but lack of the appropriate management skills and skilled workers. The Philippines industry can hiring more technical staff. The availability continue to benefit from the competitive labor of scientists and engineers in the country, cost of the country, as the average engineer’s however, is scored at only 3.8 (out of 7)9. monthly salary in manufacturing is the lowest Strategy Framework To generate more quality jobs and competitive competitiveness of industries and by creating products, the industry sector will be a dynamic industry ecosystem. A dynamic revitalized through expanding the domestic industry ecosystem will enable better access market and supplier base, moving up the of firms, particularly MSMEs, to science, value chain, and enhancing linkages across technology, and innovation, which are key sectors (See Figure 6.1). Moving up the value drivers of industrialization. chain can be achieved by improving the Figure 6.1 Strategy Framework to Revitalize Industry TRANSFORM PRODUCTION SECTORS TO GENERATE MORE QUALITY JOBS AND COMPETITIVE PRODUCTS REVITALIZE INDUSTRY: SCIENCE, TECHNOLOGY, AND INNOVATION-DRIVEN INDUSTRIALIZATION DOMESTIC MARKET PRODUCTION INTER-SECTORAL AND SUPPLIER BASE EXPANDED MOVING UP THE VALUE CHAIN ACHIEVED LINKAGES ENHANCED Enhance business-matching Competitiveness Improved Dynamic Industry Ecosystem Created Link industrial policy with activities across regions trade and investment policy Address gaps in industry Bolster science-based Intensify support to supply chains industries linked to GVC Promote industries producing for the agglomeration/co-location domestic market Ensure efficient movement Embrace industry 4.0 for of industry and services of goods across the technology-mature firms including academic Provide targeted, regions institutions time-bound incentives to Upskill and reskill workers Lower energy costs and to adapt to technology Strengthen establish labor-intensive industries and businesses promote renewable energy academe-industry linkages Enhance the NQI System sources Foster regional Adopt international Upgrade industry roadmaps industrialization Accelerate the standards and international digitalization and certification Enhance servicification of Establish common service innovation of MSMEs and industries facilities startups Develop value-adding activities and downstream Activate business networks Update agribusiness Pursue entrepreneurship industries of the mining across industries leveraging sector roadmaps technology-enabled business models Undertake industry-specific R&D and technology Put in place business adoption continuity plans in all industries ENABLING ECONOMIC ENVIRONMENT Chapter 6 Revitalize Industry | 145 Strategies Outcome 1: Domestic market production and supplier base expanded An integrated industrial policy approach to Map out value chains across sectors. expand domestic production and supplier Government will facilitate the linking of base is critical to achieving inclusive and the upstream segments to the downstream sustainable growth. This entails enhancing segments through capacity development and business-matching activities across the regions, assistance to meet technical requirements. intensifying support to industries producing The experience of the Supplier Development for the domestic market, and providing Program of the DTI and BOI in assessing targeted and time-bound incentives to establish the presence and capabilities of local parts labor-intensive industries and businesses. suppliers for automotive, aerospace, and Enticed by the large domestic consumer base, electronics sectors can provide insights for the entrepreneurs leveraging technology-enabled effective implementation of this strategy. business models will be supported. These strategies will induce the private sector Intensify support to industries to work with government in establishing producing for the domestic market common service facilities, in updating and Provide assistance to expand market share. implementing agribusiness roadmaps, and in Manufacturers producing for the domestic undertaking industry-specific research and market are faced with competition from development (R&D) and technology adoption. lower-priced imports that tend to flood the Philippine market and encroach on Enhance business-matching domestic market shares. To address this, the activities across regions government hosts provincial and national Scale up domestic investment promotion trade fairs for domestic manufacturers and business-matching activities at the local and food processors. Specifically, the One level. Because of the large coverage of the Town, One Product (OTOP) shows, and Go Negosyo Centers and the variety of services Lokal! concept stores in major malls provide they can provide, the Department of Trade marketing assistance to industries that are and Industry’s (DTI) Negosyo Centers located producing for the domestic market. To be on all over the country will be the avenues for par with foreign competitors, businesses are business-matching activities, which would equipped with knowledge, and the right tools link MSMEs to large enterprises in the regions. to ensure quality and safe production through The database of Negosyo Centers can also serve the Shared Services Facilities (SSF) program, as a means for clustering MSMEs to build scale which will be expanded to allow more access and meet the demands of large enterprises. points particularly for areas outside the National Capital Region. 146 | Philippine Development Plan 2023-2028 Support affordable production for (PPE), surgical masks, and medical testing construction. Small-scale real estate kits, among others, for the domestic economy. developers should consider efforts that This includes loans for equipment needed are aimed at consolidating their demand in manufacturing hospital-grade PPEs and for construction materials, especially medical supplies. Technical assistance will sustainable construction materials. Such also be provided to companies to meet the arrangements can help developers overcome standards of hospitals. Government support the disadvantages posed by the inherent will also be provided for the streamlining fragmentation and geographical dispersion of of complex rules and regulations affecting housing projects. Furthermore, they benefit business operations of HLS manufacturers. from the resulting reduced transport costs, and suppliers’ wholesale prices. Demand Agribusiness includes manufacturers of consolidation will continue to be pursued condiments, cacao processing, coffee, mango, by the Board of Investment, which has been pili, dried fruit, banana, and rubber, among active in arranging reverse trade agreements others. Through the Strategic Investment among buyers and sellers in the industry, Priority Plan (SIPP), fiscal and non-fiscal wherein buyers present their needs for certain support will be provided to food processors to materials, and arrange for preferential pricing enable them to compete against imports from from interested suppliers. neighbors in the Association of Southeast Asian Nations (ASEAN). SSFs for agribusiness Provide targeted, time-bound will likewise be expanded and upgraded. incentives to establish labor-intensive industries and For automotive manufacturing, government businesses support to programs and measures such as the Electric Vehicle Incentive Strategy, Support for construction and housing will which is similar to the Comprehensive be sustained through fiscal and non-fiscal Automotive Resurgence Strategy program, incentives directed toward housing will be expanded. These programs help production confronted with deficits. This increase the domestic market base. In includes supporting socialized urban, turn, these industries attain economies of economic and low-cost housing; developing scale, realize their export potentials, and and implementing information technology deepen their participation in global value (IT) systems that support general operations chains. Furthermore, incentives to be given from amortization collection and marketing; must be well-targeted, performance-based, developing globally accepted housing transparent, and time-bound. industry standards; and standardizing building components. Foster regional industrialization Support for health and life science (HLS) will The government will promote and support specifically target manufacturing of essential regional and urban centers specializing in products like personal protective equipment industries where they are most competitive, recognizing the value of the industries in the Chapter 6 Revitalize Industry | 147 regions as producers for the local market, and regional inclusive innovation centers (RIICs) addressing regional growth and development were established in Cebu, Davao, Legaspi, and disparities in the country. These can be done by Cagayan de Oro. More RIICs were added in upgrading the OTOP, developing knowledge 2021 to 2022 covering Zamboanga, Batangas, hubs in each region, and developing platforms Tuguegarao, Central Luzon, Iligan, Leyte, that support an innovative culture. and Cordillera Autonomous Region. These innovation centers will continue to provide Upgrade the One Town, One Product. design thinking workshops, and serve as venues The DTI will partner with the National for networking and engaging with the academe, Academy of Science and Technology and the industry, and other ecosystem players. Philippine American Academy of Science and Engineering to improve further the OTOP. Establish common service facilities DTI regional offices will work with their Common service facilities for storage and respective Regional Development Councils logistics, such as handling and cold storage (RDC) to advance the implementation of services, will be established to help ease the production-based regional development. burden of high storage and logistics costs Develop knowledge hubs in each region. borne by MSMEs. Another service facility that Through close collaboration among the can be provided to MSMEs is the open-access Commission on Higher Education (CHED), do-it-yourself maker space called Fablabs, Department of Science and Technology which will allow MSMEs to explore the use of (DOST), and DTI, at least one state university digital fabrication. Meanwhile, digital training or college in each region will be selected to centers will provide support to MSMEs serve as the knowledge hub in the region. The interested in exploring the use of digital chosen university will perform R&D work technology. These facilities will be pursued for enterprises, and train entrepreneurs and together with the private sector, which will enterprise employees, among others. Within house the facilities and manage access to the medium term, the state universities and eligible MSMEs. colleges (SUC) in a specific region will be Update agribusiness roadmaps clustered or amalgamated to form a regional university that will serve as a component of The agribusiness and/or commodity industry the region’s inclusive innovation centers (IIC). roadmaps will be upgraded to consider the evolving domestic and international Develop platforms to support innovative environment. The roadmaps will be aligned culture. Inclusive innovation centers will be with the updated Philippine commodity expanded to serve as platforms to promote industry roadmaps released by the Department an innovation culture, accelerate the of Agriculture (DA), as these pertain to the commercialization of R&D outputs in the upstream sectors of the food processors and regions, equip universities to carry out research food manufacturers (See Chapter 5). relevant to industries, and adopt technology solutions to create intellectual property. In 2019, 148 | Philippine Development Plan 2023-2028 Undertake industry-specific R&D and value. For the construction companies, R&D technology adoption solutions include green architecture, additive manufacturing, and safer local construction Support will be provided to the industries’ materials which eventually lead to the R&D needs to enhance technology adoption expansion and upgrading of construction and stimulate productivity growth. For materials suppliers. The Science for Change instance, the food manufacturing industry Program (S4CP) of the DOST will be makes use of R&D solutions to develop expanded to support the industries in their innovative and environmentally-sustainable R&D needs (See Chapter 8). packing materials, canning techniques, and identification of ingredients with high nutritive Outcome 2: Moving up the value chain achieved Moving up the value chain is a mechanism the supply of iron ore and coal. On the part for businesses to increase economic activity, of the DA and Department of Energy (DOE), become more productive, and provide more seedling development for high-yield coconuts jobs. This can be achieved by improving the and other energy crops will be pursued to competitiveness of businesses, particularly increase feedstock. This includes the mapping MSMEs, and by creating a dynamic of suitable areas for feedstock production for industry ecosystem. the biofuels industry. Competitiveness improved Ensure efficient movement of goods across the regions Address gaps in industry supply chains Improving the logistics, transport, and delivery services of the country will ensure that the The implementation of the manufacturing parts and components manufacturers, and roadmap will be intensified to address value raw materials processors located in various chain gaps in industry. Over the medium term, regions of the country will be able to supply the use of sustainable raw materials (along their products to the next stage of the value with parts and components) and intermediate chain at minimal cost. Strategies for improving products, and the linking of manufacturing logistics, transport, and delivery services are with knowledge-intensive services will discussed in Chapter 7. be encouraged. Specifically, the DTI, in coordination with the DOST, will facilitate Lower energy costs and promote the establishment of supply hubs for raw and renewable energy sources natural materials in furniture manufacturing. Meanwhile, the DTI and the Mines and Reducing energy costs will be a vital thrust for Geosciences Bureau will undertake programs a revitalized industry and expanded frontiers. to enhance the integration of the iron and steel This will significantly provide support to the industry with mining, to include increasing other production sectors of the economy, and tremendously result in positive externalities. Chapter 6 Revitalize Industry | 149 To realize these, the implementing rules and Link MSMEs with startups and regulations of the Renewable Energy Act of multinational corporations (MNC) or 2008 will be amended. The DOE, in accordance companies. To accelerate innovation with existing laws, will provide the legal and and digital transformation, the DTI regulatory policy environment to ensure will link MSMEs with startups through that power-generating provinces are given the continued implementation of the preferential treatment in availing lower power Innovative Start Up Act, particularly costs for its constituents, and a continuous 24/7 those that could help improve MSMEs’ supply of power. Likewise, the amendments digital transformation. Tie-ups between to the Electric Power Industry Reform Act MSMEs and large domestic enterprises (EPIRA) will be pushed (See Chapter 12). and multinationals will be strengthened, to facilitate the transfer of know-how, Accelerate the digitalization and the upgrading of products and processes innovation of MSMEs and startups conforming to international standards With more than 95 percent of establishments or best practices, and the upscaling of in the Philippines being MSMEs, targeted MSMEs. Similarly, MSMEs and startups support to MSMEs will be provided to ensure will be linked for funding and innovation that they remain competitive as they face the partnership opportunities. challenges of the new normal. The strategies Intensify support for the digital that would be adopted to support MSMEs and transformation of MSMEs, and the startups include the following. growth and development of startups. The Business mentoring, and evolving demand for new and high-quality entrepreneurship training to help products and services requires support establish more MSMEs. The DTI will for MSMEs’ adoption of digitalization, administer enabling programs to help technology, and automation, leading would-be entrepreneurs establish their to higher productivity and greater businesses. Continuing programs of the innovation. The DTI, in collaboration DTI such as Negosyo Center Seminars, with the Department of Information and the SME Roving Academy, and the Communications Technology and private Kapatid Mentor ME would further help sector partners, will provide a digital infuse an entrepreneurial mindset. The platform for MSMEs and startups. Negosyo Centers are also venues for To strengthen digital transformation, the teaching basic entrepreneurship skills, DTI will implement the following strategies such as: the basic rules for spotting market : (a) craft and implement programs to opportunities; finding product positioning build the startup ecosystem (with a and differentiation; product development; common understanding of the startup market development and basic business journey and ecosystem development finance; and plan preparation. among government agencies toward the alignment and harmonization of startup 150 | Philippine Development Plan 2023-2028 policies and programs); (b) provide provide an environment with sufficient checks strong focus on promoting innovation from the government to ensure consumer and entrepreneurship; (c) create a more protection (See Chapter 10). Furthermore, the enabling business environment for government will provide a supportive policy MSMEs startups; and (d) allow more environment for entrepreneurs and startups foreign participation. through the exploration of various modes of development finance or blended finance To address the limited financial resources (See Subchapter 11.1) to encourage business for the digital transformation of MSMEs,10 activities of targeted beneficiaries, specifically access to finance will be expanded women, youth, and persons with disabilities. by improving the credit information, collateral registry, and insolvency regime. Put in place business continuity Government will improve credit reporting plans in all industries systems by enabling the digitalization of Enterprises can improve competitiveness MSME data and expanding the movable by becoming more resilient to risks and collateral registry (See Subchapter 11.1). vulnerabilities. The National Wages and The implementation of a central bank risk Productivity Commission and other relevant database will enable de-risking lending agencies will provide capacity building to MSMEs. Strengthening key agencies’ through its Productivity Toolbox, which in capacity for implementation of the turn will aid in the preparation of business insolvency regime should also be pursued. continuity plans and strengthen their Conduct extensive innovation pitching entrepreneurial capabilities. The government, for MSMEs and startups. The DTI, through capacity-building and technical through partnerships with industry assistance, will help equip enterprises with associations, will create opportunities skills to improve their ability to tap alternative for MSMEs and startups to convert their suppliers, and beef up inventory capacity to ideas into breakthrough innovations. An insulate against vulnerabilities. example of such activity is the open pitching Dynamic industry ecosystem competition for startups in Western created Visayas conducted by the Philippine Software Industry Association.11 Bolster science-based industries linked to global value chain Pursue entrepreneurship leveraging technology-enabled business models The adoption of new technologies is a way to strengthen innovation through the Entrepreneurs exploring the use of new creation of new products and services in the technology and technology enabled-business market, resulting in more quality jobs, higher models will require a high degree of incomes, emergence of new industries, and regulatory flexibility, market openness, and promotion of environmental goods. Through a competitive environment. The DTI will science-based industries—industries linked to institutionalize a regulatory sandbox that will Chapter 6 Revitalize Industry | 151 science, technology, and innovation—a strong Philippine businesses may qualify for fiscal domestic base of knowledge production and and non-fiscal measures. technology generation is made available. These present opportunities for the development of Execute the Harmonized National new industries and knowledge intensification Research and Development Agenda of existing industries. They also provide (HNRDA) 2022–2028 with its Industry, complexity, agglomeration, networking, Energy and Emerging Technologies clustering, and externalities that eventually roadmaps. 14 The DOST, in partnership result in industrial negentropy. To bolster with DTI, will hasten the implementation science-based industries, the following of the HNRDA 2022–2028. The HNRDA strategies shall be implemented: guides the research program of the country to ensure that the results of Intensify the clustering of existing science, technology, and innovation will knowledge-and-technology intensive support the achievement of national goals. industries (KTI). The implementation 12 Under the latest HNRDA, the industrial of the DTI’s Industrialization Plan applications cover additive manufacturing; 2022–2028 will ensure that the public advanced materials; materials for sector will work together with the existing energy; nanotechnology; optics and companies and business groups operating photonics; electronics; information and in high- and medium- knowledge and communications technology; Industry technology industries. This will strengthen 4.0; quantum technology; construction; industry clusters that will generate AI; space technology applications; increased demand for knowledge and transportation; energy and utilities; technology-intensive applications and unmanned vehicle systems; food; metal high-skilled labor. & engineering; mining & minerals; and processing (agro-industrial, natural Intensify the promotion of the Strategic products, textiles, and chemical and Investment Priority Plan. The BOI and biological manufacturing). other investment promotion agencies will continue aggressively promoting The HNRDA 2022–2028 will also establish the SIPP. The SIPP aims to attract avenues for engagement between the investments for technology-driven public and private sector toward a strong industrial production capabilities aimed collaboration in emerging knowledge- at structural transformation. It serves and technology-intensive industries as a catalyst and engine for industrial (EKTI). The DOST and DTI will facilitate development and transformation to public–private collaborations on EKTIs that produce more diversified, competitive, have high potential to adopt research results complex, and sophisticated products. and commercialized applications. These Depending on the location, tier,13 and encompass (a) additive manufacturing; market orientation, eligible activities of (b) AI industry; (c) sustainable energy industry; (d) advance materials and 152 | Philippine Development Plan 2023-2028 precision industry; (e) smart mining (green Innovation, Science and Technology metals); (f) advance aerospace & space Park (KIST Park), among others. The technology; (g) supply chain provenance creation of ecozones will be within the (an offshoot of blockchain technology); existing investment promotion agencies (h) creative industries in manufacturing; to maximize investments and promote (i) advance agro-manufacturing industry industrial dispersion especially outside (with focus on food); (j) cyber-physical metropolitan areas. Further, the ecozones security industry; (k) circular commodity will be integrated into the local economy industries (basic chemical, basic by relaxing the requirements, facilitating polymer, basic pesticides, fertilizer, the free flow of parts, components, and pesticide, manufacturing); and (l) health other inputs, and increasing open trade care manufacturing industry (with between zone locators and firms outside biotechnology). the zones.16 Sustain the Science for Change Program. Implement the priority global value The DOST, with the science–technology– chains (GVC)-oriented industry clusters. innovation (STI) ecosystem, will sustain Given the changes in consumer trends, the momentum of the S4CP. The S4CP has and the acceleration of the adoption of four components, namely: Niche Centers new technologies during the pandemic, in the Regions for R&D (NICER) Program, the DTI, in collaboration with other Collaborative R&D to Leverage Philippine government agencies, will implement the Economy (CRADLE) Program, Business following four industry clusters seen as Innovation through S&T (BIST), and R&D potential sources of growth in the country: Leadership (RDLead) Program. It has (a) Industrial, Manufacturing and created opportunities in advancing science, Transport (IMT); (b) Technology, Media, technology, and innovation in the country and Telecommunication (TMT); (c) Health for capacity building of R&D institutions, and Life Science (HLS); and (d) Modern and improving industrial competitiveness. Basic Needs (MBN), Resilient Economy. The first three clusters are currently Accelerate the implementation of the undergoing global reconfiguration and ecozone transformation roadmap. The provide an opportunity for the Philippines Philippine Economic Zone Authority to upgrade, diversify, and reposition its (PEZA) will expedite the implementation global value chain participation. of the ecozone transformation roadmap.15 The roadmap expands the different types The IMT cluster’s three subsectors of Special Economic Zone registrable (aerospace, automotive, and under PEZA to include new models semiconductors) provide upgrading incorporating townships, such as the opportunities in the Philippines. Agro-Forestry Ecozone; Aquamarine Park; An opportunity for the Philippines Defense Industrial Complex; Halal Hub; lies in upgrading its participation in Island City Ecozone; and the Knowledge, the electronics, and electrical parts & Chapter 6 Revitalize Industry | 153 components GVCs. This is a common the pharmaceutical sector will attract thread among these three IMT subsectors, leading multinational companies while by attracting more FDIs in design capacity promoting the domestic suppliers’ to capture more value added, and expand network. In addition, Big Data and the manufacturing sector. analytical needs associated with health care represent additional growth Digitalization of services in the TMT opportunities for the BPO and IT cluster is also reshaping opportunities outsourcing sectors. for the Philippines. The key trend for the business process outsourcing (BPO) Meanwhile, the MBN cluster addresses sector moving forward is the switch from the need to pursue food security and cost-saving to value-adding activities. modernize the agricultural and fishing The next decade will also witness sector. This, along with other goals the BPO segment as a cross-cutting such as quality education, clean water & contributor to the competitiveness and sanitation, and affordable & clean energy, efficiency of other GVCs that they are offers opportunities for new investments supporting. AI-based cloud analytics to support the country’s economic and enterprise resource planning will recovery and long-term sustainable and continue to expand, along with the inclusive growth. normalization of the work from home arrangement. The 82 percent share of Embrace Industry 4.0 for Philippine BPOs and shared services technology-mature firms centers in the global market will be Industry 4.0 has been creating new industries leveraged by targeted policies to increase and disrupting business models at an the country’s participation in the TMT accelerated pace. New technologies arising GVC cluster. from industry 4.0 will spur the development of new production techniques and business With a health crisis at the root of the models that will transform global production current global economic distress, systems, create new and more distributed the HLS cluster plays a strategic supply chains, and trigger selective reshoring role in opening income-generating and nearshoring, thus requiring new skills opportunities for the country. The and capabilities at each GVC stage. The development of the IMT and TMT DTI’s strategies to take advantage of these clusters will facilitate the emergence new technologies to support the innovation of an HLS cluster in the Philippines. capacity and competitiveness of Philippine Specifically, the IMT cluster (through businesses include the following: electronics parts and components) will develop further the medical device Implement Industry 4.0 roadmaps. The sector, while the TMT cluster (through DTI and DOST have formulated Fourth the health care IT services) will advance Industrial Revolution (4IR or Industry the health care service sector. Moreover, 4.0) roadmaps, outlining overall strategies 154 | Philippine Development Plan 2023-2028 for the necessary facilities and services, Assist firms in implementing digital human resources, R&D technologies, readiness. Through the Smart Industry and science and technology policies. One Readiness Index17 project, the government example of such 4IR roadmaps that could will support firms and industries that are be implemented is the AI Roadmap. It shifting to new technologies by providing provides for the establishment of the deeper awareness and understanding of Center for AI R&D. AI adaption will enable digital transformation, assisting firms in the country to tap vast opportunities to their technology readiness assessment and help maintain the regional and global guiding firms in crafting their firm-level competitiveness of industries, prepare the Industry 4.0 roadmaps. future workforce for the jobs of the future, and attract AI R&D of multinational Provide soft loans or technical assistance. and big tech companies to locate in the Support measures like soft loans, subsidies, Philippines. The Center is envisioned to and technical assistance programs will be a public–private partnership to serve help firms increase their resilience, as a hub for data scientists and researchers enabling them to become more adaptive in performing collaborative AI R&D, to production shocks or supply systems provide consultancy services, create AI changes through the adoption of advanced tech products, and conduct data literacy technology and automated processes. programs. The Center will focus on Create the Industry 4.0 Sandbox. The key areas utilizing AI such as precision Industry 4.0 Sandbox will be equipped farming, smart manufacturing, healthcare with advanced manufacturing modules services, AI-powered BPO, smart cities, and technology for R&D and prototyping and resilient technology. activities. Through the Industry 4.0 Build Industry 4.0 facilities. An Industry sandbox, Philippine manufacturers will 4.0 pilot factory will serve as a platform be able to experiment with Industry 4.0 for a collaborative learning environment solutions in settings that mimic a fully to teach and demonstrate Industry 4.0 supported production environment management and production technologies without restrictions nor interruptions to like advanced robotics, automation, IoT, daily operations. and smart manufacturing, especially for Upskill and reskill workers to adapt large enterprises, MSMEs, researchers, to technology and universities. DTI is also working with DOST in establishing Industry While many jobs will be lost as a result of 4.0 facilities, including the Advanced automation and advancements in digital Manufacturing Center ; and the Advanced technology, new jobs will also emerge that will Mechatronics, Robotics, and Industrial increase workers’ productivity. Tapping these Automation Laboratory. benefits will require increasing investments in skills development, along with greater efforts by companies to upskill or reskill Chapter 6 Revitalize Industry | 155 their workforce to perform new and higher procedures, packaging, and labeling to be at order roles complementary with machines. par with international standards. Current systems of learning and job fitness do not provide the agility that lifelong learners Adopt international standards and will require; hence, the need to shift to a international certification skills-based system that can provide more Information campaigns targeting MSMEs efficient mechanisms. The academe–industry will be launched to promote the benefits of collaboration will also serve as a main avenue accreditation and conformance to international to improve skills development (See Chapter 4 standards. Specific attention will be given to for a more detailed discussion on reskilling). essential sectors such as health care and food processing, which will support the economy Enhance the National Quality during times of crises. Infrastructure System There is a need to address the fragmented nature Develop value-adding activities and of the country’s National Quality Infrastructure downstream industries of the mining system, which limits the capacity of local sector manufacturers to comply with global technical The mineral resources of the country will be regulations and standards. To address this, the primarily used for industrial value-addition. passage of the NQI law will be pursued. The In particular, mineral ores are highly preferred law is expected to harmonize the country’s to be processed domestically for downstream standards, technical regulations, metrology, industries (See Chapter 15). accreditation and conformity assessment Outcome 3: Inter-sectoral linkages enhanced Revitalizing industry through science, Link industrial policy with trade and technology, and innovation industrialization investment policy will require enhancement of several linkages Trade strategies that support industrial across sectors . Industries need to increase their development include pursuing high-impact linkages with agriculture and services sectors. Free Trade Agreements (FTA) and Manufacturers need to expand domestic arrangements to create the enabling linkages while exploring further participation environment for facilitating investments in the global value chains. The link between from target-source countries, like the United trade and industrial policy will also be States and South Korea, in terms of capital strengthened. Finally, the policy implementers and technology. The Regional Comprehensive need to work together to ensure a business Economic Partnership (RCEP) Agreement environment that revitalizes industry. and the Philippines–South Korea FTA are trade agreements that will be signed and fully implemented. These will provide an overall framework for the entry of investors in areas 156 | Philippine Development Plan 2023-2028 such as electric vehicles, pharmaceuticals, and HLS clusters. Of particular interest are electronics, and agro-processing. the semiconductor manufacturers who are currently diversifying production locations. The Philippine government will also actively Relatedly, to position the Philippines as a participate in the negotiations with the hub for knowledge and technology-intensive innovation- and technology-rich countries export industries, the Philippines will that will complement STI-driven strategy and, participate in negotiations to come up with in parallel, aggressively attract investments relevant disciplines on the digital economy from global companies in the TMT, IMT, and e-commerce. Box 6.1. Cluster-based Approach to Industrialization The Philippines’ post-COVID-19 recovery could benefit from the reconfiguration of its leading export sectors in four clusters. These are: Industrial, Manufacturing and Transport (IMT); Technology, Media, and Telecommunication (TMT); Health and Life Science (HLS), and Modern Basic Needs, Resilient Economy (MBN). The IMT cluster provides the country with upgrading opportunities in aerospace, automotive, and semiconductors. The cluster covers the following: aerospace and maintenance, repair, and overhaul (MRO) including flight control actuation systems, servo actuators, servo valves, galley inserts, structures and equipment, seat parts, lavatories, interior fit-out, panel assembly, electronics, airframes and sub-assemblies, and MRO base and line maintenance, automotive including auto electronics, advanced driver assistance systems (ADAS) components, engineering services outsourcing, electric motor powertrains like battery, public utility vehicles, electric vehicles (EV) and EV parts, green metals value-adding and processing, semiconductor manufacturing services including wafer fabrication, integrated circuit design, R&D, and electronic manufacturing. The TMT cluster will provide the Philippines opportunities from the digitalization of services (See Chapter 7 for more details on the strategies related to services). The TMT cluster covers the following: IT-BPM, hyperscaler data centers, creative industries, trans-shipment facility operations for global logistics, regional telecommunication infrastructure services, and digital economy; and new products, activities, or solutions using digital technologies like artificial intelligence, robotics, augmented reality, virtual reality, mixed reality, 5G connectivity, and Internet of Things in the following areas: • Smart technology: applications in buildings, homes, factories, agriculture, cities, interconnected products and services, voice assistants embedded in TV sets, cars, home appliances, smart home devices, and home robots • Resilient technology: disaster preparedness/mitigation, cyber security, and renewable energy • Vehicle technology: self-driving cars, multimodal transportation, and EV • Audio, video, and education technology • E-gaming: console and personal computer gaming software, mobile gaming, immersive audio and advanced communication capabilities, cloud gaming platforms, and gaming accessories • Metaverse: applications for gaming, entertainment, education, and marketing, among others In the HLS cluster, the goal is to make the Philippines self-sufficient in pharmaceuticals (with companies like Lloyd Laboratories aiming to make the Philippines self-sufficient in pharmaceuticals), medical devices, healthcare services, digital health products and services such as personal health wellness technology products, therapeutic systems addressing chronic diseases, telemedicine solutions, and artificial intelligence (AI)-assisted diagnoses. The HLS cluster covers the following: life sciences and biotechnology sector, vaccines, pharmaceuticals, medical devices, healthcare services, digital health products and services such as personal health wellness technology products, smart watches, lighter health wearables, more precise sensors, therapeutic systems addressing chronic diseases, telemedicine solutions, and AI-assisted diagnoses. The MBN cluster refers to modern basic needs, such as food, shelter, infrastructure, and education, along with activities that foster economic resilience. The cluster covers the following activities and sectors: food security, agro-industrial including coffee, cacao, coconut, fruits and nuts, tropical fibers, rubber and other high-value crops, fishing, blue economy, processed minerals, infrastructure, education, shelter, sanitation, textile, chemicals and plastics, and sectors that foster economic resilience such as energy efficiency, renewable energy, and goods that improve the quality of life while minimizing the use of resources and inputs. Chapter 6 Revitalize Industry | 157 Promote agglomeration or for the industry and the necessary support co-location of industry and services, needed to achieve these. However, the rapid including academic institutions development in technology, the geopolitical uncertainties, and the challenges brought The skills and jobs needed by industries will about by climate change require a reassessment be matched to those offered by the academic of these roadmaps. Thus, the updating of institutions by putting together in one industry roadmaps, with focus on innovation location the industry, services, and academic measures, and skills & competencies critical to institutions. Specific services such as R&D, the industries for 4IR technology adoption and business support, marketing, and financial sustainable manufacturing, will be undertaken services will be made available to support the by DTI and DOST. One example of the roadmap operation of industries in the area. The KIST that can be updated is the pharmaceutical parks being implemented by PEZA will be roadmap, which can be elevated into an HLS expanded to pursue this strategy. roadmap by: (a) incorporating plans for the Strengthen academe–industry institution of a knowledge center of excellence linkages in collaboration with HEIs; (b) mapping the innovation ecosystem available to the cluster; The experience of the University of the and (c) enabling a superior environment Philippines (UP) as an innovator and incubator afforded by, for example, a dedicated technology of health devices and other innovations used by park or campus and venture capital provision. the UP Manila–Philippine General Hospital, especially during the onset of the COVID-19 Enhance servicification of industries pandemic, is evidence that in some areas our As servicification is a business decision country has the capacity to answer domestic and a response by manufacturers to market needs without having to rely on imports. conditions, government will further The innovation was made possible by the UP strengthen the inter-industry demand Surgical Innovation and Biotechnology. The between industry and service sectors to DTI and DOST will tap other SUCs and HEIs to encourage more servicification. Developing host several programs, activities, and projects product standards, protecting consumer that help accelerate scientific advancements preferences, reducing regulatory demands or and technological developments in the form requirements, enhancing export orientation & of technical services, industry assistance, GVC participation, and utilizing government collaborative research, and product design procurement are examples of demand-side and development. These will be made possible strategies, which the government can through the help of industry partners, the implement. The implementation of the SIPP government, and other funding agencies. provided under the Corporate Recovery and Upgrade industry roadmaps Tax Incentives for Enterprises Act will provide targeted and time-bound fiscal incentives to The DTI and DOST have produced industry activities that will enhance manufacturers’ roadmaps that outline the vision and targets in-house servicification. These include R&D 158 | Philippine Development Plan 2023-2028 and engineering services that will lead to services subsectors, encompassing wholesale better manufacturing processes, resulting in trade, telecommunications, information and higher labor productivity. Productivity will communication technology, real estate, and also be improved even without adopting new professional and technical services. technologies, by simply tweaking existing steps and removing unnecessary ones. Activate business networks across Services providing expertise on organizational industries paradigms, such as lean manufacturing, could A more active interface and collaboration contribute to this endeavor. In addition, with the industry ecosystem will be EKTIs will increase the interface of industry established among these business networks. and services sectors due to the inherent Manufacturing industry associations and synergistic processes between the two sectors. cross-industry linkages will be strengthened For instance, under advance materials and and activated toward solving coordination precision, a number of Submanufacturing problems to promote backward and forward industries, such as petroleum manufacturing, linkages and economies of scale as well as chemical manufacturing, and metal facilitate information and resources sharing. manufacturing, are strongly linked to the Legislative Agenda Table 6.1 presents the priority bills of the 19th Congress to revitalize industry: Table 6.1 Legislative Agenda to Revitalize Industry RESPONSIBLE LEGISLATIVE AGENDA RATIONALE/KEY FEATURES AGENCY Ratification of the Regional The RCEP negotiations were launched in November 2012 and concluded eight years after, in Department Comprehensive Economic November 2020, at the height of the coronavirus disease (COVID-19) pandemic. RCEP is a free trade of Trade and Partnership (RCEP) agreement between 15 countries comprising the ASEAN-10 and Australia, China, Japan, South Korea, Industry (DTI) and New Zealand. Joining the RCEP can significantly enhance the market access of the Philippines. National Quality Infrastructure The bill intends to establish standardization, metrology, accreditation, and conformity assessment DTI, Department services necessary to provide acceptable evidence that products and services meet defined of Science and requirements, demanded either by authorities or the marketplace. Moreover, it seeks to hasten Technology (DOST) regulatory approvals for the release and sale of goods and services into the markets, and ascertain protection of consumers from trade malpractices and substandard or hazardous products. Amendment of the Philippine The Philippine Qualifications Framework will be updated to incorporate the Philippine Skills DTI Qualifications Framework Framework and will serve as a common reference that employers and workers share to ensure the (Republic Act 10968) match between jobs and skills. Amendments to the Philippine This entails updating of the 27-year-old PEZA law to adopt to the digitalization of the locators. PEZA Economic Zone Authority (PEZA) law Philippine Standardization Act The proposed bill envisions to update RAt 4109, which was enacted in 1964. DTI of 2022 Internet Transactions Act The bill seeks to establish an effective regulatory policy for commercial activities conducted through DTI the internet or electronic means. Enterprise Productivity Act This aims to strengthen the productivity improvement and gainsharing between workers and DTI enterprises. Science and Technology Parks This proposes the establishment of science and technology parks nationwide to largely promote DOST Act the culture of competitiveness and innovation through the active promotion of investments from tech-based enterprises and knowledge-based institutions. Chapter 6 Revitalize Industry | 159 Results Matrix Table 6.2 presents the indicators and targets under the Plan period to revitalize industry. Table 6.2 Results Matrix: Revitalize Industry TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Outcome 1: Domestic Market Production and Supplier Base Expanded Gross value-added 6.5 7.0–8.0 8.0–9.0 9.0–10.0 10.0–11.0 11.0–12.0 11.0–12.0 11.0–12.0 National Income Department (GVA) growth of (Q1–Q3 2022) Accounts (NIA) of Trade and modern basic needs Industry (DTI), (MBN) sectors Philippine increased (%)a Statistics Authority (PSA) GVA growth of 15.8 16.0–17.0 16.0–17.0 16.0–17.0 16.0–17.0 17.0–18.0 17.0–18.0 17.0–18.0 NIA DTI, PSA construction (Q1–Q3 2022) increased (%) Outcome 2: Moving Up the Value Chain Achieved Competitiveness improved Ranking in IMD World 39th of 63 37 36 34 33 31 30 30 IMD DTI Competitiveness (2022) survey improved (Business efficiency Pillar) Firms offering formal 59.8 62 64 67 70 72 75 75 Global Innovation DTI, Department training relative to (2022) Index of Science and the total number of Technology firms increased (%)b (DOST), Technical Education and Skills Development Authority Share of medium 0.41 0.42 0.44 0.45 0.47 0.48 0.50 0.50 Updating of DTI, PSA enterprises to (2021) the List of total number of Establishments micro, small, and medium enterprises increased (%) Dynamic industry ecosystem created Number of scientists, 24,887 30,728 32,051 33,432 34,872 36,374 37,940 37,940 R&D Statistics DOST, PSA engineers, and (2018) technicians employed in businesses increased (head count)c Labor productivity in 0.498 0.72– 0.73– 0.75– 0.76– 0.78– 0.80– 0.80– NIA, Labor Force DTI, PSA industry increased (Q1–Q3 2022) 0.73 0.75 0.77 0.79 0.81 0.83 0.83 Survey (2018=100; PHP million/employed) Labor productivity 1.029 1.048 1.072 1.096 1.120 1.144 1.169 1.169 NIA, LFS DTI, PSA in manufacturing (Q1–Q3 2022) increased (2018=100 ; PHP Mn/Employed)d 160 | Philippine Development Plan 2023-2028 TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Employment 446 500–600 530–630 560–660 590–690 620–720 650–750 3,450– LFS DTI, PSA generated in industry (Q1–Q3 2022) 4,050 increased (‘000)e A. Employment 231 300-360 318-378 336-396 354-414 372-432 390-450 2,070- LFS DTI, PSA generated in (Q1–Q3 2022) 2,430 manufacturing increased (‘000)e B. Employment 184 185-198 194-208 204-218 213-228 222-238 231-248 1,215- LFS DTI, PSA generated in (Q1-Q3 2022) 1,300 construction increased (‘000) GVA growth rate of 2.65 2.9-3.2 3.4-3.8 4.1-4.6 5.0-5.5 6.0-6.7 7.2-8.0 7.2-8.0 NIA DTI, PSA High knowledge-and- (Q1-Q3 2022) technology intensive industries (KTI) increased (%)f GVA growth rate 11.52 10.6-11.8 10.8-12.0 11.0-12.2 11.2-12.5 11.5-12.7 11.7-13.0 11.7-13.0 NIA DTI, PSA of Medium KTI (Q1-Q3 2022) increased (%)g Digital transformation 5.73 5.82 5.91 6.01 6.10 6.20 6.30 6.30 IMD World DTI, Department in companies (2022) Competitiveness of Information improved (Score survey and 0–10)h Communications Technology (DICT), DOST GVA growth rate 7.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 NIA DTI, PSA of industry sector (Q1-Q3 2022) sustained (%)i GVA growth rate 5.3 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 8.0-9.5 NIA DTI, PSA of manufacturing (Q1-Q3 2022) sector increased (%)i Percent of firms with 30.7 35.0 50.0 50.0 SIA DTI, DOST, product innovation (2015) Philippine increased (%)j Institute for Development Studies (PIDS) Percent of firms that 42.9 48.0 51.0 51.0 SIA DTI, PIDS, DOST are innovation active (2015) increased (%)j Share of high-tech 63 65.56 68.22 70.99 73.88 76.88 80.0 World Trade DTI exports to total (2020) 80.0 Organization exports increased (%) Firms adoption of Non-core: 24.0 26.0 28.0 28.0 DTI, DICT, DOST, e-commerce via the 17.7 SICT PSA internet increased Core: 22.2 (%)k (2017) Regional inclusive 11 ≥1/ ≥17 DTI DTI innovation centers (2022) Region established Chapter 6 Revitalize Industry | 161 TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Outcome 3: Inter-sectoral Linkages Enhanced Number of 6-digit 2,915 3,073 3,239 3,415 3,600 3,795 4,000 4,000 Foreign Trade DTI, PSA exported products Statistics increasedl (2021) Number of 5 ≥1 ≥1 ≥1 ≥1 ≥1 ≥1 ≥1 Philippine PEZA knowledge, Economic Zone innovation, science, (2022) Authority (PEZA) and technology annual report parks established a This includes manufacture of food products, manufacture of beverages, manufacture of textiles, manufacture of wearing apparel, manufacture of leather and related products, including footwear, manufacture of wood, bamboo, cane, rattan articles and related products, manufacture of chemical and chemical products, manufacture of furniture. b Obtained from the Global Innovation Index. The term includes scientists and engineers. c Obtained from DOST Compendium of R&D Statistics. Per Philippine Statistics Authority, the term “Scientist” is generally synonymous with the definition of the term “Researcher” as defined in the Frascati Manual. d Targets obtained by straight line forecast using 2010–2019 data. e Employment generated refers to the additional employment from the preceding year. Data obtained from the Labor Force Survey. The DTI targets an employment generation between 3.45–4.05 million for the industry sector by the end of Plan period. Similarly, the employment generation for manufacturing by the end-of-plan period is between 2.07 and 2.43 million. f Includes the GVA for manufacture of basic pharmaceutical products and pharmaceutical preparations, manufacture of computer, electronic and optical products, and manufacture of transport equipment. g Includes the GVA for manufacture of chemical and chemical products, manufacture of electrical equipment, manufacture of machinery and equipment except electrical. h Based on the IMD World Competitiveness Executive Opinion Survey; targets are based on the scores of the best performer in the ASEAN. i Industry and manufacturing growth rates based on DBCC projections. j Based on the PIDS Survey of Innovation Activities, 2015. k Based on the Survey of Information and Communication Technology, 2017. l Sourced from the International Trade Center Trademap. 162 | Philippine Development Plan 2023-2028 1 Google, Temasek, and Bain and Company. 2021. E-conomy SEA 2021 Roaring 20s: The SEA Digital Decade. https://services.google.com/fh/files/misc/e_conomy_ sea_2021_report.pdf. 2 Aldaba, R. 2022. Philippine Industrialization: Recovery and Growth Toward Shared Prosperity, Sustainable and Inclusive Economic Development. Paper presented at the UPSEAA Forum. October 07, 2022. Zoom meeting. 3 The First Industrial Revolution was driven by the introduction of steam power, which enabled steam-powered mechanization of weaving processes overtaking the use of traditional looms. The Second Industrial Revolution is characterized by the conveyor system transporting automobiles to fixed workstations. The Third Industrial Revolution enabled the automation of industrial processes using electronics and computers. Finally, the Fourth Industrial Revolution is driven by tools such as the Internet of Things, artificial intelligence, cloud computing, and digital platforms. 4 Aldaba, R. 2022. Philippine Industrialization: Recovery and Growth Toward Shared Prosperity, Sustainable and Inclusive Economic Development. Paper presented at the UPSEAA Forum. October 07, 2022. Zoom meeting. 5 BusinessWorld Online. 2022. Electronics Sector Sets 10% Growth Target for 2022. https://www.bworldonline.com/top-stories/2022/01/28/426426/electronics- sector-sets-10-growth-target-for-2022/. 6 October 2022 PMI figures for China (49.2), South Korea (48.2), Taiwan (41.5), and the Euro Area (46.4) have fallen below 50.0 signaling a contraction of manufacturing activity while the United States and Japan have PMIs that are dangerously close to a contraction at 50.4 and 50.7, respectively. 7 Arenas, G. and S. Coulibaly. 2022. A New Dawn for Global Value Chain Participation in the Philippines. International Development in Focus. Washington, DC: World Bank. doi:10.1596/978-1-4648-1848-6. 8 Based on a JETRO survey as cited by World Bank. 2020. “Next Administration: A Reform Agenda for Manufacturing Development.” Washington, DC. 9 World Economic Forum. 2018. Readiness for the Future of Production Report 2018. https://www.weforum.org/reports/readiness-for-the-future-of-production- report-2018/?DAG=3&gclid=CjwKCAiAnZCdBhBmEiwA8nDQxRpXRXLdZ8LOoErGGQx9q83bW3nONDsSuBkUFFDsXBYd4s-VeZ8nOxoCn4kQAvD_BwE. 10 Particular attention should also be given to improving access to finance of women-led MSMEs. 11 Department of Trade and Industry (DTI). 2021. MSMEs Urged to Embrace Digitalization, Innovation. URL here. 12 Following the latest nomenclature of the OECD (Indicators 2020) across economies, high R&D-intensive industries include aircraft, computer, electronics, and optical products, pharmaceutical, and publishing including software. Medium R&D-intensive industries include chemicals (excluding pharmaceuticals), electric equipment, other machinery & equipment, and transportation equipment. 13 Tier 1 applies to job and value creation activities, value chain upgrading, and support sectors critical to industrial development. Tier 2 applies to activities critical to industrial development and import-substituting activities. Tier 3 applies to R&D and breakthroughs in science; health; and generation of new knowledge & IP, commercialization, and highly technical manufacturing. 14 Department of Science and Technology. 2022. Harmonized National Research and Development Agenda 2022–2028. https://www.dost.gov.ph/ phocadownload/Downloads/Resources/Quick_Links/HNRDA_2022-2028.pdf. 15 Philippine Economic Zone Authority. 2022. Excellence and Innovation in Investment Promotion PEZA’s Milestones at 27. https://www.peza.gov.ph/press- releases/excellence-and-innovation-investment-promotion-peza%E2%80%99s-milestones-27. 16 Aldaba, R. and A.D. Quejada. 2022. ”FDI Spillover Effects: Evidence in the Philippines.“ ERIA Discussion Paper Series No. 437. 17 The Smart Industry Readiness Index, developed by the Singapore Economic Development Board, is a suite of frameworks and tools designed to help manufacturers start, scale, and sustain their manufacturing transformation journeys. It covers three major blocks: process, technology, and organization, each of which are comprised of pillars and dimensions to be evaluated to generate a holistic Industry 4.0-readiness assessment. Chapter 6 Revitalize Industry | 163 07 Reinvigorate Services CHAPTER 7 Reinvigorate Services The services sector will shift from its current low productivity level to enable the Philippines to become a modern, productive, and resilient global leader providing higher value-adding and differentiated services. Market expansion and digital transformation will create the pathways for services firms to enhance their strong presence in markets, reach new market segments and buyer geographies, and pursue diversification. The sector will gain strength, speed, and size from the dynamic ecosystem of technology, talent and skills development, intellectual property rights protection, and competition for creativity and innovation. A strong public–private–social partnership will be nurtured to expand investments in the regions and enhance strategic inter-sectoral linkages for inclusive, resilient, and sustainable participation of the Philippines in global value chains that mark the Fourth Industrial Revolution. This chapter presents the challenges in reinvigorating services and the outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) market expansion achievedcreativity and innovation in services value proposition strengthened Assessment and Challenges For the first three quarters of 2022, the services influenced by the rise in consumption of sector grew by 8.9 percent year-on-year. Other services by the production sectors (including services activities recorded the highest growth services itself), from 35 percent in 20061 to at 33.2 percent, followed by accommodation 41 percent in 2018.2 The embodied services and food service activities at 29.7 percent, and (shares of services in total intermediate inputs) transportation and storage at 25.9 percent. in manufacturing increased from 18 percent to The services sector remains the largest sector 26 percent during the same period.3 However, in the economy with a share of 60.9 percent the Philippines’ manufacturing exports have in gross domestic product (GDP). The sector weak linkages with modern services, such as is still on track to achieving the target growth business and financial services,4 research and of 7.3–8.3 percent for the year. Increased development (R&D), and design during pre- economic activities and improved consumer and post-production stages. and business confidence brought about by the easing of pandemic restrictions are expected While the services sector is the largest to accelerate the sector’s full recovery in 2022. employer with an average of 57 percent share in total employment from 2017 to 2021, it is Beyond their direct contributions to growth still dominated by low-pay jobs concentrated in terms of generating jobs, export revenues, in low-skills domestic services (i.e., retail and investments, services bind the value chain trade, administrative and support services, links across economic sectors. The share of arts, entertainment, and recreation, and services in GDP has increased over time, other community and personal services) that Chapter 7 Reinvigorate Services | 167 accounts for more than half of the sector’s gross skills transfer; (d) laws such as the Philippine value-added, and employs 69.4 percent of the Creative Industries Development Act total workforce in the services sector. (PCIDA), Innovation Act, Innovation Startup Act, and the Digital Competitiveness Act that The overall labor productivity level of will foster creative industries (7.9% of GDP in services sector in 2021 (PHP0.44 million 2018)7 and science–technology–innovation at 2018 constant prices) is low and slower (STI) driven industrialization; and (e) growth than the productivity of the industrial sector of the digital economy (9.6% of GDP in (PHP0.69 million at 2018 constant prices). 2021)8 and use of automation and artificial From 2017 to 2021, employment in services intelligence (AI). grew by an average of 3.2 percent per year while Apart from the overall low productivity of productivity increased by 1.3 percent per year. the sector, the disparity in performance of the In terms of labor productivity, the information services sector across Philippine regions also and communication services grew the fastest needs to be addressed to promote inclusive (5.3%), followed by finance and insurance growth.9 The binding constraints to increasing activities (4.7%), public administration productivity include high shipping and and defense (3.7%), and education (3.3%). logistics cost, lack of access to reliable and The sectors heavily linked to production advanced information and communications experienced decline in productivity during technology (ICT) infrastructure, lack of the same period - wholesale and retail trade competition, lack of access to markets and (-0.4%), transportation and storage (-1.3%), capital, mismatch in skills and lack of skilled and professional and business services (-5.8%). talent for niche job roles, and vulnerabilities of Key opportunities for job creation and communities to the impact of climate change.10 increased participation in higher value-adding Increasing international tourism expenditures services include: (a) growth trajectory of the and foreign direct investment will be greatly information technology and business process needed to match the expected rise in capital management (IT-BPM) sector (8% revenue importation associated with upgrading the growth per year in the next six years) to create global value chain (GVC) in manufacturing. one million direct and additional 1.1 million The economic reforms and their respective indirect jobs by 2028;5 (b) openness of implementing rules and regulations will Philippine tourism and potentials to surpass facilitate the flow of investments in the regions, its 2019 record (12.9% share of GDP and modernize the services sector, accelerate 5.7 million employment);6 (c) economic the country’s economic recovery from the reforms such as the Amendments of the coronavirus disease (COVID-19) pandemic, Public Services Act, Foreign Investment Act and promote inclusive growth. (FIA), and the Retail Trade Liberalization Act (RTLA) to catalyze investments and talents and 168 | Philippine Development Plan 2023-2028 Strategy Framework The main goal is to reinvigorate the services dynamic business models. The three elements sector to generate more quality jobs and of technology, training, and talent can build competitive products. During the Plan a more robust and dynamic ecosystem period, the government and private sector driven by creativity and innovation. Finally, will strengthen their partnership to expand investments to enhance inter-sectoral linkages, markets and achieve scale through aggressive especially in liberalized sectors enabled by the marketing and promotions, trade, and amendments to the Public Services Act, FIA, global partnerships, and facilitate the use and RTLA, present opportunities to magnify of digital technologies and processes to the spillover effects of technology, training, raise productivity in low-skills services. and market growth toward greater inclusion Building the capabilities of more companies and overall transformation. is important to shift to higher value and differentiated services and high-skills jobs. Three sector outcomes are envisioned: To facilitate this upgrading, they need new (a) market expansion achieved, (b) creativity technologies, skilled management and and innovation in services value proposition workforce, and a steady supply of talent. New strengthened; and (c) inter-sectoral linkages technologies will allow them to reduce costs, enhanced (See Figure 7.1). create new services, and operate with new and Figure 7.1 Strategy Framework to Reinvigorate Services TRANSFORM PRODUCTION SECTORS TO GENERATE MORE QUALITY JOBS AND COMPETITIVE PRODUCTS REINVIGORATE SERVICES MARKET CREATIVITY AND INNOVATION IN INTER-SECTORAL SERVICES VALUE PROPOSITION EXPANSION ACHIEVED STRENGTHENED LINKAGES ENHANCED Promote sustainable, inclusive, and Increase access of MSMEs to capital, Facilitate physical connectivity resilient multidimensional tourism and digital technologies, and startups (aviation, shipping and maritime, and holiday economics Increase access of MSME management land) and convenience to move people Align public service delivery to industry and workforce to training and capacity and goods needs to lower costs building programs Improve competencies for business Ensure safety and security in cyber and Build capabilities of the creative advisory services physical spaces industries Strengthen data collection ecosystem Develop the services in trade Increase access to funds and incentives for market intelligence, insights, and framework to maximize trade for research and development (R&D) industry studies agreements and startup ecosystem development Secure foreign capital to modernize Ensure the sustainable supply of a Improve the quality of the Philippine infrastructure, fleet, and equipment and competitive, creative, and skilled tourism experience position the Philippines as strategic hub workforce for aviation, shipping and maritime, and Foster the creative industries Strengthen intellectual property rights logistics services Spearhead active promotions of ecosystem Promote digitalization in transport and tourism, culture, creative industries, logistics to lower costs and Information Technology and Develop technology parks, centers of Business Process Management creative excellence and innovation, Increase internet speed, coverage, and creative talent hubs, and improve network Accelerate e-commerce adoption by micro, small, and medium enterprises shared services facilities for MSMEs Strengthen collaboration among (MSME) Foster partnership with the academe, government, and Industry government to develop AI applications Boards in talent and skills development Encourage creation of consumer interest groups and establish linkages between large companies and MSMEs for value chain upgrading Chapter 7 Reinvigorate Services | 169 Strategies The following strategies will be implemented to achieve the sector and subsector outcomes and targets. Outcome 1: Market expansion achieved Promote sustainable, inclusive, and local tourism plans and institutionalization of resilient multidimensional tourism tourism offices for sustainability. The LGUs, and holiday economics with assistance from the DOT and Tourism Infrastructure Enterprise Zone Authority, Diversify product portfolio through will prioritize the provision of destination multidimensional tourism that offers a range infrastructure (e.g., water, sanitation, solid of experiences by highlighting the strengths waste management, health care facilities, of the Filipino people, natural and cultural renewable energy, early warning systems) to endowments in culture and heritage, arts, food increase the carrying and adaptive capacities of and gastronomy (including Halal), nature-based destinations against future crises and climate farm tourism, cruises, film, medical, health and change impact. wellness, meetings, incentives, conventions, and exhibitions. The Department of Tourism Promote “holiday economics” and invest (DOT) will accelerate the roll out of the product in year-round, domestic, multi-media development manual and training modules for campaign together with the LGUs, private local government units (LGU) to increase the sector, and educational institutions to readiness of products and destinations for safe, encourage Filipinos to travel, promote pride of smart, and sustainable tourism. place and culture, and become ambassadors of Philippine tourism. Increase participation in high-impact international events and dedicated Improve the quality of the Philippine investment missions to build on positive tourism experience perceptions and success stories of destinations and people. Promote partnerships with the Promote national accreditation such as Department of Trade and Industry (DTI) and the progressive accreditation system and Department of Foreign Affairs in securing ANAHAW Philippine Sustainable Tourism and disseminating market intelligence and Certification to build the confidence in showcasing the assets of the Philippines in of markets and enterprises. Advocate creative tourism. enterprises to offer sustainable services as key differentiators of Philippine tourism Improve local tourism governance by using international standards for low-carbon transforming LGUs into destination emission tourism value chains. management organizations with strong private sector partnership. The LGUs will spearhead Increase the capacity of the DOT regional the development and implementation of their offices and the LGUs to assist enterprises’ 170 | Philippine Development Plan 2023-2028 complete accreditation. The initiative Spearhead the active promotion aims to increase the number of enterprises of tourism, culture, creative that embrace quality standards in facilities industries, and the information and services for the benefit of tourists and technology and business process enterprise owners. management sector Strengthen transfer of knowledge and Harness the creative industries to increase practices in promoting Filipino cultural positive perception of tourism destinations values as a competitive advantage in human and build the distinctly Filipino brand of capital development and in achieving tourism and culture. Expand marketing sustainable tourism. In partnership with thrusts by actively participating in domestic the DOT, the private sector will promote and international travel trade shows, partnerships between large enterprises familiarization trips, and consumer activation and micro, small, and medium enterprises programs supported by the government. (MSME) to propagate high service quality in Partner with international organizations tourism, curate mutually beneficial authentic and networks of global Filipino communities tourism experiences with local communities, to increase market access of Philippine and scale up sustainable tourism practices. destinations and Filipino creative designs Foster the creative industries and products. Support the formation of the Philippine Further strengthen presence in markets such Creative Industries Development Council as North America where the Philippines (CIDC) as provided under Republic Act enjoys strong market shares in products, No. 11904. The DTI will chair the CIDC, such as contact centers and financial and which will be composed of 19 members, ten professional services. Protect the country’s of which should be ex-officio (government dominant position in service in these markets, members) and nine regular members from with the IT and Business Process Association the private sector. The CIDC will prepare of the Philippines, subsector associations, and the Creative Industries Development Plan, firms as prime movers guided by the industry Creative Industries Investments Priority Plan, roadmap, i.e., The Big PH IT-BPM Leap: The and undertake road-mapping efforts for the Philippine IT-BPM Industry Roadmap 2028. different identified creative sectors under the nine domains of the PCIDA. Deepen penetration for new high value-adding and high-yielding products (e.g., financial, health care, retail, technology, media, and telecommunication, cybersecurity) in Europe and Asia-Pacific. Demonstrate and showcase existing capabilities of the Philippines to offer high value-adding and differentiated services, such Chapter 7 Reinvigorate Services | 171 as transportation design; services using AI; digital more women to engage in entrepreneurial and data services (blockchain, cloud and mobile activities. (See Subchapter 3.2) apps, Internet of Things, augmented reality, virtual reality, mixed reality, Big Data analytics); Ensure safety and security in the e-gaming; animation; audio-visual services; and cyber and physical spaces digital applications in health services. Adopt a legal framework to strengthen cybersecurity and policies on minimum Align public service delivery to information security standards to protect industry needs and business models critical information infrastructure and the ICT to lower costs systems of public institutions, transportation, Streamline requirements and procedures and e-commerce transactions, and increase and implement 24/7 operations of agencies capacity of the private sector to mitigate piracy at ports and airports to reduce transport of creative outputs. and logistics costs. Remove redundancies and reduce the steps involved in the submission Implement the Financial Consumer of requirements to regulatory agencies Protection Act that better enables financial (e.g., permits and licenses; documentary regulators to address consumer complaints requirements; client steps; and fees in on cybercrimes and enforce sanctions against cold storage, freight forwarding, trucking, erring entities. warehousing, and domestic shipping Establish a Transportation Safety Board businesses). Harmonize accreditation to serve as an independent investigatory, processes between DTI and concerned research, and standards-setting agency agencies such as the Civil Aeronautics Board dedicated to promoting safety in all modes of for freight forwarding companies. Ensure transportation (i.e., land, sea, air, and railway). the availability of budget for agencies, such as the Bureau of Customs (BOC), Bureau Develop the services in trade of Animal Industry (BAI), Bureau of Plant framework to maximize trade Industry (BPI), and Bureau of Fisheries and agreements (See Chapter 9) Aquatic Resources (BFAR) to enable them to hire human resources and procure the right Accelerate e-commerce adoption system and software to support efficient 24/7 by micro, small, and medium operations. The LGUs are encouraged to enterprises remove costs such as pass-thru fees and ensure Engage businesses in awareness and advocacy safe entry and exit of goods in their respective campaigns on the benefits of e-commerce in areas of jurisdiction. increasing their visibility and global reach. Private technology and platform providers, Facilitate business name registration, industry associations, and conglomerates will licensing, and social protection of enterprises be encouraged to scale up collaboration with and gig workers (freelancers, contractors, the DTI and partner agencies to increase the independent professionals), and enable adoption of e-commerce tools by MSMEs 172 | Philippine Development Plan 2023-2028 in services (e.g., wholesale and retail trade, Encourage creation of consumer tourism, and arts and culture) to improve interest groups their processes, and to accept digital payments Expand the participation of communities toward a cash-lite economy. in promoting competition in services Establish secure e-payment systems and through coalition-building, alliances, ensure consumer and supplier protection and partnerships. This aims to produce online to promote trust and confidence in social capital to resolve collective issues and the digital uptake. The enhanced protection challenges encountered in modernizing the will create value through increased traceability services sector; increasing entry of foreign of goods, including imported orders. players; and addressing anti-competitive practices as well as poor environmental, social, Promote cybersecurity culture. Create greater and governance practices. awareness of the global and local cybersecurity context, including the threat landscape among Promote consumer and producer rights employees, industry partners, and customers. protection by streamlining processes for resolution of disputes and complaints that may be related to defective goods, fraud, cybercrime, payment security issues, and security of websites. Outcome 2: Creativity and innovation in services value proposition strengthened Increase access of MSMEs to capital, Increase access of MSME digital technologies, and startups management and workforce to training and capacity building Invest in STI-driven upgrading of MSMEs, programs including process, product, organization, and marketing. Through the Center for Enhance digital, management, and Artificial Intelligence Research (CAIR) and entrepreneurship competencies of MSMEs. DTI’s Regional Inclusive Innovation Centers, Through the implementation of the Digital MSMEs will gain access to ideas, technology, Workforce Competitiveness Act, the DTI, and talents to improve firm performance. in coordination with relevant government Under the Philippine Innovation Act, entities agencies and the private sector, shall establish from the creative industries may avail of shared co-working or shared service facilities to service facilities from the DTI, as well as the support the development and enhancement infrastructure and R&D support programs of of digital skills and competencies of the Department of Science and Technology. entrepreneurs, especially women, and the current and future workforce. Chapter 7 Reinvigorate Services | 173 The Philippine CIDC will undertake training Build capabilities of the creative and capacity building in business development industries to enhance financial literacy, ethics, digital The DTI as Chair of the CIDC will lead skills, taxation, design thinking, contracts, the formulation and implementation of a negotiations, and entrepreneurship. Philippine Creative Industries Development Develop technology parks, Plan mandated under RA 11904. This plan centers of creative excellence and will define the value creation, market creation innovation, and creative talent and expansion, investment targets, intellectual hubs and improve shared services property targets, and other strategies, facilities for MSMEs among others. Match real estate development projects Promote the Malikhaing Pinoy Creative to the requirements of the creativity, Market Acceleration Program, which is a innovation, and entrepreneurship handholding program and support for trade ecosystems. The IT-BPM companies will have and investment promotion to increase value dedicated “creative hubs” located in campuses chain participation of creative industries. with flexible workspaces and common infrastructure to support creative freelancers. Increase access to funds and Creative hubs with training and advanced incentives for R&D and startup opportunities; advanced research labs; and ecosystem development business support centers (for legal, mentoring Provide funds and incentives, such as and guidance services, linkages with investors, low-interest loans, scholarships, research and repositories of creative images as sources grants, training subsidies to promote startups, of inspiration) will be established to support digital technology careers, innovations, and MSMEs, creative entrepreneurs, and startups. research projects that address industry needs. Foster partnership with the Financial capital is provided under the Corporate government to develop AI Recovery and Tax Incentives for Enterprises applications and establish linkages Act, Innovation Act, Innovation Startup Act, between large companies and and Digital Workforce Competitiveness Act. MSMEs for value chain upgrading These legislations support startup entrepreneurs, scientists, and researchers to achieve STI Private sector investors will be encouraged interventions, accelerate the transfer and to take part in the CAIR. This will expand commercialization of generated technologies, the Center’s business segments and increase and strengthen the capability of human resources the number and scope of AI projects that and institutions to undertake R&D. can be accommodated. Craft and implement programs to build the startup ecosystem. Create a common understanding of the startup journey and ecosystem development among 174 | Philippine Development Plan 2023-2028 government agencies toward the alignment DepEd, CHED, and TESDA shall continue to and harmonization of startup policies and extend incentives to academic institutions that programs. The government shall also provide provide funds and grants for the research of strong focus on promoting innovation and their students and faculty on the development entrepreneurship, create a more enabling and promotion of the services sector. business environment for startups, and allow more foreign participation. Strengthen collaboration with the private sector in mentoring programs; promotion Ensure the sustainable supply of a of science, technology, engineering, competitive, creative, and skilled entrepreneurship, arts, and mathematics workforce careers; and interventions to build talent in differentiated services proposition. This Implement the Philippine Tourism Human initiative aims to increase financial, digital, Capital Development Plan 2021–2025 to and cybersecurity literacy; and develop ensure the steady supply of trained human entrepreneurial and creative skills from early resources. The development of competent, schooling by revising curricula (inclusion world-class Filipino tourism professionals of mandatory basic computer education, through the education system is the core of the introduction of relevant electives and/or plan. The Filipino Brand of Service Excellence micro-credentials across courses) to support Program of the DOT will continue to promote IT-BPM upgrading. the best qualities and positive values of Filipino hospitality. Strengthen the intellectual property rights ecosystem Establish a Creative Educational Plan in partnership with the private sector and the Provide capacitybuilding measures through academe. The Department of Education the CIDC and partners in facilitating the (DepEd) and Commission on Higher registration of patents, and monitoring and Education (CHED) shall support and develop protection of intellectual property rights, relevant programs and provide scholarships traditional cultural skills of Filipino creative to deserving students enrolled in programs industry stakeholders, and indigenous cultural and courses related to creative industries. The communities against infringement. Technical Education and Skills Development Authority (TESDA) shall also provide technical Accede to the 2005 United Nations and vocational training through scholarship Educational, Scientific, and Cultural programs and continuous education. And the Organization Convention. Ratifying this CIDC shall provide technical and financial Convention will further promote and protect assistance to providers of non-formal learning the works of creatives in the country, as it modalities. focuses on protecting the diversity of cultural expressions all over the world. It highlights Appropriate funds for educational the creative industries, which have become institutions that will revise or develop new important drivers of cultural and economic curricula to address learning gaps. The development of nations. Chapter 7 Reinvigorate Services | 175 Outcome 3: Inter-sectoral linkages enhanced Facilitate physical connectivity endowments of the country by connecting its (aviation, shipping and maritime, various islands and destinations. This supports and land) and convenience to move the objectives under the Maritime Industry people and goods Development Plan 2019–2028 to accelerate the achievement of a nationally integrated Increase access to tourist destinations and globally competitive maritime industry, through an improved and sustainable and to position the country as an aviation hub transportation network, and digitalization in Asia. Foreign capital shall be utilized to of tourist services to increase yields from increase the capacity of the aviation, maritime, higher spending and length of stay in a wide and shipping companies to: (a) invest in green, range of destinations. Develop and expand modern, and resilient hubs, equipment, and inter- and multi-modal tourism routes (air, fleet; (b) build capabilities to participate in the shipping and maritime, land) supported by transportation GVCs (design, maintenance, the DOT, Department of Transportation, and repair, and overhaul); (c) upgrade and align Department of Public Works and Highways. education and training programs with Provide support for update of the National international standards; (d) promote best Cruise Tourism Strategy to enhance the safety and security practices; and (e) develop contributions of local and international modernized gateways and clusters to attract cruise tourism and maritime industries to the international logistics, retail, IT-BPM, and Philippine blue ocean economy and jobs. tourism companies. Promote barrier-free tourism by providing Promote digitalization in transport technology-enabled real-time information and and logistics to lower costs assistance, and the Filipino brand of service excellence and care to visitors, particularly Promote 24/7 operations of businesses, those with special needs. including brokerage houses, distribution centers, warehouses, shipping lines offices, and banking Secure foreign capital to modernize facilities. Advocate the BOC and partner agencies infrastructure, fleet, and equipment such as BAI, BPI, and BFAR to shift to 24/7 and position the Philippines as a services and match the 24/7 port operations. This strategic hub for aviation, shipping initiative of the Logistics Services Philippines and maritime, and logistics services aims to ensure seamless, secure, and timely flow Leverage the Public Services Act, FIA, and delivery of goods to customers. and RTLA amendments to attract global Increase utilization of technology in logistics partners and innovators (See Chapter 9), to processes to improve coordination among modernize services and to reduce overall stakeholders (brokers, shipping lines, airlines, transport and logistics costs. Through cargo consolidator and freight forwarders, and partnerships with foreign companies, the government). In partnership with the DTI, the private sector will harness the strategic Logistics Services Philippines and its partners locational advantage and archipelagic 176 | Philippine Development Plan 2023-2028 shall collaborate to increase the use of digital Strengthen data collection technologies, disseminate correct information, ecosystem for market intelligence, and promote real-time monitoring for insights, and industry studies improved transparency and efficiency in the Promote the active participation of colleges mobility of goods. and universities in collecting and analyzing Expand participation in the modernization data in the services sector. Subsequent of existing airports, ports, and land transport research outputs of the academe will help terminals to reduce overall transportation increase access to information by MSMEs that costs and shipment delays (See Chapter 12). can improve their linkages with markets, and enhance their services and ability to create Increase internet speed, coverage, and offer new and high-quality services. The and network government shall invest in the development Expand fiber-optic, broadband, and 5G of satellite accounts for other services, such network in areas identified by industries on as transportation and logistics, including a priority basis for fast speed, high density of subnational satellite accounts (tourism, digital IT-BPM workers, clustering of tourism and economy, creative industries, and logistics), on retail facilities, and activities, ports, airports, a phased priority basis. transport terminals, logistics facilities and Increase the capacities of destination creative industries. stakeholders to adopt digitally enabled data Build and operate broadband facilities to collection tools and measures. Pivoting to offer internet services in underserved and Big Data will complement the collection unserved areas. Use direct access to all satellite of traditional indicators, support product systems, whether fixed, mobile, international, and market development, reduce costs and or domestic, to connect local businesses and create value along the tourism supply chain, tourism sites with their developing markets and engage local communities for improved and to build resilience. policy-making processes. Improve competencies for business Strengthen regular and active participation advisory services of private sector and communities to promote free flow of information with the government. Increase readiness of local destinations and Associations will share insights, market LGUs in hosting investments. Led by the DTI intelligence, and data on the sectors they represent Board of Investments, in collaboration with and contribute to the development of online sector- or area-focused investment promotion directories and registries. Councils and networks agencies, private sector, and academe, develop such as the Philippine Creative Cities Network an ecosystem of advisory services to enable and the Local Culture and Arts Council for the LGUs to acquire strategic skills tand capacitate development of the local creative industries them to match local service firms with under the PCIDA will advance collaboration and investors, build the expertise of LGUs in risk competitiveness by enhancing linkages between management, and conduct due diligence. industries and government. Chapter 7 Reinvigorate Services | 177 Through the CIDC, lead the development of development of labor market information the Creative Industry Data and Information systems (See Chapter 4). Management in coordination with the Philippine Statistics Authority (PSA) and other Expand talent pool through the transfer relevant national government agencies to set up of international talents and skills, and a satellite account for creative industries that exchange programs for faculty and students also covers data collection and management. (See Chapter 4). Promote diversity to nurture creativity in the private sector by partnering Strengthen collaboration among with international networks of suppliers, academe, government, and buyers, and educational institutions. industry boards in talent and skills development Provide information and expert advice on the must-have skills and competencies Revise existing curricula or design new under the Philippine Skills Framework courses based on the needs of the industries. (PSF) Initiative to boost the capacity of the The private sector will work closely with Philippines in skills of the future.11 Under the the academe and government agencies in PSF on logistics and supply chain, the first to be the conduct of tracer studies; design and launched by the DTI under the initiative, the implementation of immersion and internship sector will collaborate with TESDA to develop programs for faculty and students in the course modules and assessment tools.12 country and abroad; and facilitation of Legislative Agenda Table 7.1 presents the priority bills of the 19th Congress to reinvigorate services. Table 7.1 Legislative Agenda to Reinvigorate Services LEGISLATIVE AGENDA RATIONALE/ KEY FEATURES RESPONSIBLE AGENCY Update RA 10372 (An Act Amending This aims to commercialize technologies and support the development of creative Intellectual Property Certain Provisions of RA 8293, industries. This will enhance the attractiveness of the Philippines as an investment Office of the Philippines otherwise known as the “Intellectual destination that places high value on intellectual property creation, protection, utilization, Property Code of the Philippines, and commercialization, as well as prevent piracy in the physical and digital markets. and for Other Purposes”) Open Access in Data Transmission This seeks to level the playing field in the data transmission and telecommunications Department of Information Act market. Its passage will strengthen value chain linkages in the industry and services and Communications sectors and facilitate the realization of the full potential of e-commerce and digital trade. Technology (DICT) and National Telecommunications Commission (NTC) Internet Transactions Act The bill aims to define the scope and coverage of internet transactions, apart from the Department of Trade and sale or exchange of digital products, and lay down the code of conduct and qualifications Industry for businesses who wish to engage in e-commerce. It also proposes the creation of an E-commerce Bureau to handle complaints on internet transactions, protect consumer rights, and facilitate the speedy resolution of complaints, among others. International Maritime This will address the expensive shipping rates in the Philippines due largely to the Maritime Industry Competitiveness Act imposition of “excessive, arbitrary, and unreasonable” shipping charges by foreign Authority shipping lines, such as the “destination and origin charges,” container deposit fees, container cleaning fees, detention and demurrage charges, and port congestion charges. 178 | Philippine Development Plan 2023-2028 Results Matrix Table 7.2 presents the indicators and targets during the Plan period to reinvigorate services. Table 7.2 Results Matrix: Reinvigorate Services TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (2021) 2023 2024 2025 2026 2027 2028 VERIFICATION INTER-AGENCY BODY Intermediate Goal Chapter Outcome: Services Reinvigorated Gross value-added growth 8.9 6.4–7.9 6.4–7.9 6.4–7.9 6.4–7.9 6.4–7.9 6.4–7.9 National Income Department rate in the services sector (year-to- Accounts (NIA) of Trade and improved (%) date, Q1–Q3 Industry (DTI) 2022) Labor productivity growth in -6.4 5.0 - 8.5 5.0 - 8.5 5.0 - 8.5 5.0 - 8.5 5.0 - 8.5 5.0 - 8.5 NIA, Labor Force Department services improved (%) Survey of Labor and Employment Contribution of tourism to 5.2 TBD TBD TBD TBD TBD TBD Philippine Department of gross domestic product ((GDP) Tourism Satellite Tourism (DOT) improved (%)1,2 Accounts (PTSA) Total tourism investments

8.8 TBD TBD TBD TBD TBD TBD PTSA DOT (as a proportion of total investments) increased1,2 Contribution of e-commerce 1.7 TBD TBD TBD TBD TBD TBD DTI eCommerce DTI to GDP increased (%)1,3 Roadmap 1 Satellite Accounts prepared by the Philippine Statistics Authority. 2 Targets will be based on the National Tourism Development Plan 2023–2028, expected to be completed by Q1 2023. 3 Targets will be based on the Philippine E-Commerce Roadmap 2023–2025, expected to be completed by Q1 2023. Chapter 7 Reinvigorate Services | 179 1 Serafica, R.B. 2014. “Formulating the Philippine Services Strategy for Inclusive Growth.” Discussion Paper Series No. 2014-22. Quezon City: Philippine Institute for Development Studies. https://pidswebs.pids.gov.ph/CDN/PUBLICATIONS/pidsdps1422.pdf. 2 Philippine Statistics Authority (PSA). 2021. 2018 Input-Output Tables. https://psa.gov.ph/content/psa-releases-2018-input-output-tables. 3 The shares of services would be higher with the inclusion of embedded services in the inputs (e.g., in-house design of manufacturing firms) or bundled together in a good (e.g., after-sales maintenance). These values are not currently monitored. 4 Arenas, G. and S. Coulibaly, eds. 2022. A New Dawn for Global Value Chain Participation in the Philippines. Washington, DC: World Bank. DOI: 10.1596/978-1-4648- 1848-6. 5 Everest Global Inc.. 2022. The Philippine IT-BPM Industry Value Proposition. Presentation during the IT and Business Process Association of the Philippines “International Innovation Summit on the Philippines IT-BPM Industry Roadmap 2028”, September 27–29, 2022, Manila. https://www.everestgrp.com/ international-innovation-summit.html. 6 PSA. 2022. Philippine Tourism Satellite Accounts (PTSA) Report. Quezon City. https://psa.gov.ph/content/philippine-tourism-satellite-accounts-ptsa-report. 7 Mapa, C. D. S. et. al. 2022. The Philippine Creative Economy Satellite Accounts: Measurement and Challenges. Paper presented during the 15th National Convention on Statistics, 4 October 2022, Quezon City. 8 PSA. 2022. Philippine Digital Economy Satellite Accounts 2021. Quezon City. 9 Serafica, R.B., J. M. Vergara, and Q.C.A. Oren. 2021. ”Regional Analysis of the Philippine Services Sector.” Research Paper Series No. 2021-04. Quezon CityPhilippine Institute for Development Studies. https://www.pids.gov.ph/publication/research-paper-series/regional-analysis-of-the-philippine-services- sector. 10 Synthesis of assessments, studies, and inputs provided by various sectors. 11 IT-BPM: analytical skills, digitally skilled talent, project management, managerial and soft skills, sector-specific skills. Tourism: operational skills; soft skills; technical, quality, professional, and leadership skills; health and safety skills; and product-specific skills. E-commerce: information technology and/or digital literacy skills, marketing and customer service skills, financial literacy, entrepreneurship. Creative industries: soft skills, critical thinking and problem-solving skills, technical skills, managerial and/or entrepreneurial skills, functional creations skills. 12 Functional Skills: management skills (operations, procurement, and supply); staff skills (driving, warehousing, inventory, logistics and forecast planning, logistics and supply chain, transport and/or traffic load planning); enabling skills (leadership, business and ethics, professionalism, customer engagement and relationship); emerging skills (AI-driven services, robotics, analytics, critical thinking, problem solving). 180 | Philippine Development Plan 2023-2028 08 Advance Research and Development, Technology, and Innovation CHAPTER 8 Advance Research and Development, Technology, and Innovation Research and development (R&D) involves creative work undertaken on a systematic basis to produce knowledge that can be used to generate new technologies and innovations. R&D, technology, and innovation are drivers of long-term economic growth and social progress. With the rise of digital transformation, strategies will be pursued to develop high-value R&D products, technologies, and innovations that will boost the efficiency and competitiveness of various sectors. The sector will implement a set of integrated strategies to (a) advance R&D, technology, and innovation from knowledge creation to commercialization of R&D products; and (b) reinforce the innovation and entrepreneurship ecosystem. The strategy framework views R&D, technology, and innovation generation as a continuum encompassing theoretical conception through basic research, technical invention, and commercial use. It seeks a balanced and strong support for both the knowledge-seeking and commercializing purposes of research, and the enabling environment that fosters a culture of innovation and entrepreneurship. This chapter presents the challenges in advancing R&D, technology, and innovation, including the outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) basic R&D and knowledge creation strengthened; (b) market-driven and customer-centered research and development advanced; (c) technology extension, adoption, utilization, and commercialization scaled-up; and (d) innovation and entrepreneurship accelerated. Assessment and Challenges The Philippines ranked 59th in the 2022 Inadequate human resources in Global Innovation Index (GII),1,2 sliding down science-technology-innovation (STI), and eight places from its 2021 ranking. Likewise, R&D. The country’s capacity to generate new the country’s rank in innovation inputs dipped knowledge and technology is dependent on its from 72nd in 2021 to 76th in 2022. Innovation human resources. Although the country has outputs fell from 40th in 2021 to 51st in 2022, relatively high 2022 GII score in “Graduates largely due to decreased performance scores in Science and Engineering,” it only has less in knowledge and technology outputs, which than 174 full-time researchers per million are mainly a function of knowledge creation, population, ranking 84th out of 132 countries. knowledge impact, and knowledge diffusion. Underdeveloped research culture and The weakest performance recorded in the productivity. The capacity to create and country was posted by institutions. discover new knowledge and explore its The critical challenges affecting the sector are applications are important considerations in as follows: advancing R&D, technology, and innovation. Figure 8.1 illustrates the low levels of knowledge creation outputs in terms of scientific and Chapter 8 Advance Research and Development, Technology, and Innovation | 185 technical publications, and citable documents, citation impact of publications and the state of which measures both the productivity and knowledge creation. Figure 8.1 Global Innovation Index Rank in Sub-Index Related to Knowledge Creation 40 50 60 54 54 54 55 55 70 80 90 100 110 120 123 120 125 124 122 130 2018 2019 2020 2021 2022 Sources: World Intellectual Property Organization. Various years. Global Innovation Index. Geneva. https://www.wipo.int/global_innovation_ index/en/; Dutta, S., B. Lanvin, L. Rivera León, and S. Wunsch-Vincent, eds. 2022. Global Innovation Index 2022: What Is the Future of Innovation-Driven Growth? Geneva: World Intellectual Property Organization. Moreover, the present government Lack of focus on information about markets procurement process delays the or users and market system requirements. implementation of R&D programs due to The proverbial orientation of producing restrictive regulations leading to low research knowledge for knowledge’s sake appears to productivity, publication potential, and characterize much of the R&D projects. It has commercialization of innovations.3 been noted that considerations about markets, users or adopters of R&D products and their Insufficient spending on R&D. The country’s needs are still limited in the research process.6 gross expenditure on R&D (GERD) stands at 0.324 percent, which is substantially below the Need for a more vigorous intellectual global average of 2.04 percent and the 1 percent property (IP) culture. The 2022 GII benchmark recommended by the United report showed attestable dips in scores in Nations Educational, Scientific, and Cultural Industrial Designs (ID), -10 spots in ranking; Organization. The government share to the Cultural and Creative Services Exports, -9; total R&D expenditure is at 39 percent, while Utility Models, -7; Patent Families, -7; and the private sector is at 61 percent. The 2022 Trademarks -3.7 The report also noted that GII ranked the Philippines 75th in GERD. the country dropped by 10 places in terms of innovation outputs as seen in the decrease Underdeveloped linkages among stakeholders in percentage points for the sub-indicators in the R&D, technology, and innovation (knowledge and technology output pillar): ecosystem. The Philippines ranked 64th in the patents by origin, IP receipts, and creative 2022 GII on University-Industry Collaboration and cultural exports. Although the declines on R&D. Most universities perceive assisting may be attributed to the lack of filing activity companies as outside of their core mission.5 during the pandemic, the two-year (2021 and 186 | Philippine Development Plan 2023-2028 2022) consecutive drop in the GII ranking to the growth of companies, and much of the calls for a need to improve the country’s IP entrepreneur-specific business services and the culture by encouraging the registration of IPs, expertise needed to grow the startup ecosystem strengthening the enforcement of IP laws, and remain low. There are observable low levels of promoting collaborations among stakeholders market-readiness and technology-readiness to transform valuable IP assets that are relevant of innovations, which lessen the attraction of and useful to industries. these products to external funders.8 Barriers to building an innovative and Notwithstanding these challenges, there are entrepreneurial culture. Challenges remain at positive directions in the development of the the formation level, such as instilling the value country’s R&D, technology and innovation of innovation and entrepreneurship, integrating infrastructure as evidenced by new laws, this orientation in the education curriculum policy actions, and various initiatives taken in at all levels, and reskilling human resources. the last six years.9 Business regulation issues remain challenging Strategy Framework The strategy framework illustrates the areas of and customer-centered R&D advanced; focus in the R&D, technology, and innovation (c) technology adoption, utilization, and generation continuum. There are four desired commercialization scaled up; and (d) innovation outcomes: (a) basic R&D and knowledge and entrepreneurship accelerated. creation strengthened; (b) market-driven Figure 8.2 Strategy Framework to Advance Research and Development, Technology, and Innovation ECONOMIC AND SOCIAL TRANSFORMATION FOR A PROSPEROUS, INCLUSIVE, AND RESILIENT ECONOMY TRANSFORM PRODUCTION SECTORS TO GENERATE MORE QUALITY JOBS AND COMPETITIVE PRODUCTS BASIC RESEARCH AND MARKET-DRIVEN AND INNOVATION AND TECHNOLOGY ADOPTION, UTILIZATION, DEVELOPMENT AND KNOWLEDGE CUSTOMER-CENTERED RESEARCH AND COMMERCIALIZATION SCALED-UP ENTREPRENEURSHIP CREATION STRENGTHENED AND DEVELOPMENT ADVANCED ACCELERATED Nurture a supportive Create mechanisms for Accelerate Support globally environment for R&D integrating market/user commercialization of competitive industries and information system market-oriented and agile workforce Re-engineer basic, inclusive STI products technical-vocational and Integrate creative arts and Accelerate business higher education social sciences with science Provide support and mentoring programs and technology incentives for IP management Accelerate the Aggressively increase Carry out R&D, technology, Intensify the technology Implementation of the national expenditure in R&D and innovation in mutually transfer, extension, and Philippine Innovation Act and its commercialization beneficial collaborations commercialization of Establish and promote publicly-funded technologies innovation hubs Increase number of partnerships for R&D Strengthen the provincial development S&T Offices Increase financing opportunities for innovation Provide analytics on markets projects Increase public-private and customers partnerships for the Increase investments in utilization and financial and entrepreneurial Aggressively increase commercialization of R&D literacy international collaborators products and global corporate R&D investors Increase venture capital investments Chapter 8 Advance Research and Development, Technology, and Innovation | 187 Strategies Outcome 1: Basic R&D and knowledge creation strengthened R&D covers basic research, applied research, will expand the sources of public funding for and experimental development. Basic research full-time researchers who are working on areas increases the ‘knowledge base’ available to or domains under the national harmonized companies and other participants in the research agenda. The government will address economy to source innovation information.10 bottlenecks in administrative processes, An important starting point is to increase including procurement and similar concerns the quantity and develop the quality of the that may hamper the conduct of publicly country’s human capital that can produce funded R&D. basic research contributing to knowledge generation, accelerate investments in R&D, and Re-engineer basic, initiate meaningful reforms in the formation of technical-vocational, and higher human capital in basic, technical-vocational, education and higher education. The Department of Education, Technical Education and Skills Development Nurture a supportive environment Authority, and Commission on Higher for R&D Education (CHED) shall pursue programs The government, in partnership with the that: (a) trigger Filipinos’ drive for curiosity private sector, will build laboratories, science and discovery; (b) cultivate their critical and technology research facilities, Knowledge, thinking, growth mindset, communication, Innovation, Science and Technology (KIST) and decision-making skills; (c) enable them to Parks, university science and technology adapt to the uncertainties of the environment; parks, technology business incubators, and and (d) develop more trusting and more other infrastructure that can reduce the collaborative relationships with colleagues. complexity and upfront costs and risks for These government agencies will promote an private R&D. The government will strengthen Industry 4.0 skills framework that maps out the Balik-Scientist Program and its support to jobs, career pathways, occupational skills, the diaspora of Filipino scientific communities micro-credentialing, and reskilling options. in other parts of the world. It will provide a program of rewards and recognition for state Aggressively increase national university and college faculties who devote at expenditure in R&D and its least eight hours a week to research work and commercialization writing. It will enhance its policy to strongly Increase investments in R&D that can benefit support institutional and individual faculty the entire country, which can also invigorate initiatives to establish linkages with industry, private R&D expenditures in related fields. foreign universities, and research institutes. It These investments shall promote various 188 | Philippine Development Plan 2023-2028 research and innovation areas identified under the country’s reliance on foreign technology, the Pagtanaw 2050.11 Moreover, it will pursue and strengthen the capabilities of domestic R&D that seeks to improve the production of firms to create and capture economic value. higher value-added goods and services, reduce Box 8.1. (Pagtanaw 2050: The Philippine science, technology, innovation foresight) Pagtanaw 2050, which literally translates to “Looking Ahead,” is the first inter-disciplinal and trans-disciplinal project on Philippine-focused science-technology-innovation (STI) foresight and strategic plan. Its main goal is to chart a strategic path by anticipating the factors that will influence the development of the Philippines’ scientific capital in the years leading up to 2050. It serves as a planning device toward achieving concrete goals and designing strategic plans that transcends political periods, while aiming for inclusive growth, sustainability, and competitiveness in STI. Pagtanaw 2050 suggests significant drivers of change and provides insights and reflections on plausible STI development paths that will impact the aspirations of the Filipino people and development of the nation toward 2050. At the core of STI Foresight are 12 key operational areas, namely: (a) Blue Economy; (b) Governance; (c) Business and Trade; (d) Digital Transformation and Information and Communications Technology; (e) Science Education and Talent Retention; (f) Food Security and Nutrition; (g) Health Systems; (h) Energy; (i) Water; (j) Environment and Climate Change; (k) Shelter, Transportation, and Other Infrastructure; and (l) Space Exploration. This STI Foresight culminates with the STI Roadmap that reiterates cluster goals for the preferred future, science, and technology enablers, drivers, and opportunities. The goal of the STI Roadmap is for the Philippines to eventually become a prosperous, archipelagic, maritime nation characterized by a society that is inclusive, productive, sustainable, educated, and healthy. The progress of each cluster is determined by the interplay of science and technology enablers, drivers, and opportunities. Achievement of a competitive economy across clusters would bring the Philippines to its preferred stature as a prosperous, archipelagic maritime nation that supports a technology-explicit development agenda that is inclusive and sustainable, and nurtures a citizenry that is educated, healthy, and productive. Source: National Economic and Development Authority Outcome 2: Market-driven and customer-centered research and development advanced Insights about markets and consumers, and responding to market failures or demand a deepened understanding of potential users issues in the private sector. will be used to drive R&D and the generation Create mechanisms for integrating a of technology and innovations. To ensure market/user information system sustainable technology commercialization, government-funded research in universities Working through the various collaborative and research institutes will shift toward a hubs such as the KIST Parks, technology market- and demand-oriented approach in Chapter 8 Advance Research and Development, Technology, and Innovation | 189 business incubation (TBI), regional inclusive the time spent for industry research and innovation centers (RIIC), and research consultation by faculties of state universities and extension offices of state universities and colleges. Facilitate the licensing of IP and colleges (SUC), the government will generated by public universities and research establish a common and accessible portal that institutes, including a royalty sharing scheme provides market intelligence. Social science and/or selling, if necessary, with the industry. researchers and student researchers in higher It will establish partnerships with countries on education institutions will be taught and pioneering R&D in specific sectors that will provided support to conduct primary data provide open access to global best practices, collection that can capture relevant market which can then be customized to suit the data, such as customer needs and preferences, Philippine context. competitors, customer demographics, market Provide analytics on markets and trends, market price, and potential marketing customers processes. These can be used to guide or inform the R&D process and aid in the generation of The private sector will be encouraged to share technology and innovation. its observations, knowledge, and insights on people’s motivations and preferences, and Integrate creative arts and product trends to help improve R&D products social sciences with science and in terms of function, aesthetic impressions, technology and market value. Capacitate human resources on the R&D, Increase number of partnerships for technology, and innovation continuum and R&D entrepreneurship to encourage the interaction of scientific, social, and creative talents, The private sector will contribute to and intellectual capital in multidisciplinary government R&D by: (a) guiding researchers collaborations. In particular, the government and scientists on consumer trends and market will bolster the participation of human resources system requirements; (b) addressing market from the creative arts and social sciences as they challenges and opportunities; (c) leveraging introduce perspectives on the experience and private investments in STI activities; (d) seeking social usage of technology and innovation, and solutions to broad national challenges such as contribute to the dynamic process of creating climate change, public health, green growth, value and competitive advantage of R&D, and energy efficiency; (e) investing or locating technology and innovation products. knowledge, science and technology parks, incubators, and entrepreneurship cells; and Carry out R&D, technology, and (f) improving academia-industry linkages. innovation in mutually beneficial private-public collaborations Aggressively increase international collaborators and global corporate Support and recognize collaborative work of R&D investors public researchers and private firms on R&D, Seek international R&D collaborations to technology, and innovation. Compensate develop innovative products and services. 190 | Philippine Development Plan 2023-2028 It will help promote the attractiveness of the the domestic adoption, implementation, Philippines as a top location for R&D and other and reengineering of new technologies from innovative activities. It will focus on improving domestic and international sources. Outcome 3: Technology extension, adoption, utilization, and commercialization scaled-up The development from a research insight to and creative startups. It will improve the a widely distributed product requires a good capacity of the private sector to create, protect, balance of: public funds and private investment; utilize, commercialize and enforce their IP public sector research, extension programs rights. The Intellectual Property Office of the and private R&D; and scientific, technology Philippines (IPOPHL) will provide businesses management, product development, diffusion, with patent mapping and analytics tools that and commercialization skills. identify trends and gaps in the technological landscape, which can be used as a basis for Accelerate commercialization of strategic direction and business decisions market-oriented and inclusive STI for pursuing R&D and investments in products technology development. Provide funding for the diffusion (i.e., extension Intensify the technology transfer, and promotion) and commercialization extension, and commercialization of of products of both publicly and privately publicly funded technologies funded STI products. It will streamline the processes for technology transfer transactions. Provide public research institutions and state The National Innovation Council (NIC) will universities and colleges with platforms, continue the administration of the Innovation including avenues to pitch their R&D products Fund under the Philippine Innovation Act to and technology developed, to successfully support the commercialization of publicly or commercialize their technologies. Programs privately funded and domestically developed will also be implemented which involve technologies and innovations. private sector participation through the promotion, utilization, and commercialization Provide support and incentives for IP of investments in these products. management The government will seek the most effective Accelerate programs to increase awareness modes of technology transfer of commercially among policymakers, private sector, university ready, and publicly funded R&D outputs researchers, and the general public of the from qualified private entrepreneurs and value and contribution of innovation and IP enterprises. This will further capacitate to economic and social development. It will the research and extension offices of state strengthen a network of IP units delivering universities and colleges and the technology timely, high quality, and accessible IP transfer and business development offices. management services that benefit technology A framework that will standardize the Chapter 8 Advance Research and Development, Technology, and Innovation | 191 procedures for research and development Increase public-private institutions and SUC for valuing their IP assets partnerships for the utilization and shall be adopted. commercialization of R&D products Strengthen the provincial S&T Engage with the private sector in adopting Offices emerging technologies that can compete in rapidly changing world markets, especially in Fast track the implementation of Republic Act the sphere of digital transformation. Working 11914 or Provincial Science and Technology with state universities and colleges and public Offices (PSTO) Act. The PSTOs are mandated research institutes, the private sector will help to identify the STI needs in the provinces, facilitate the transition from the laboratory to implement DOST programs that will be the marketplace, and from demonstration of beneficial in rural areas, and develop the technical “proof of concept” to commercial institutional linkages among provincial offices, introduction of a new technology product or academe, and local government units. The service in the marketplace. PSTOs will lead the promotion and transfer of technologies and services to enhance Increase venture capital investments the technology-livelihood enterprises in The private sector will provide support for the countryside. startup technology innovators through “angel” investors (i.e., wealthy individuals with experience in starting up new companies), and venture capital firms specialized in early-stage or “seed” investments. Outcome 4: Innovation and entrepreneurship accelerated Innovations flourish as a result of the pursuit of creating high-quality jobs and well-developed entrepreneurial skills. While competitive products and services. innovation involves the production of a new product, service, or system, entrepreneurship Support globally competitive consists of creating value out of these industries and an agile workforce new ideas and turning them into business Improve the competitiveness of creative, opportunities. The skills in innovation ideation science and technology industries through the and production must be complemented with establishment of industry hubs. It will foster the the appropriate business mindset and skills creativity and digital dexterity of the country’s involving risk-taking and decision making, human capital. It will support industry ventures market research and trends, collaboration, on digital transformation, such as the use leadership, planning, and management, of Artificial Intelligence, Robotic Process among others. Fostering a strong culture of Automation, and Internet of Things, among innovation and entrepreneurship are vital to others. It will support academe-industry collaborations on skills frameworks and other 192 | Philippine Development Plan 2023-2028 trainings, particularly in science and technology, strengthen entrepreneurship and enterprises to ensure that the future workforce has the engaged in developing innovative solutions. necessary science, technology, engineering, and To generate public support on the country’s mathematics skills supporting the growth of innovation priorities, the NIC will also develop the Philippine science and technology industry a National Innovation Communication Plan. into the future. The NIC together with the Regional Research, Development, and Innovation Committee Accelerate business mentoring and of the Regional Development Councils will scientific technical assistance monitor innovation policies and programs Strengthen current mentorship and coaching (i.e., NIASD), as guided by the National programs for science and technology startups Innovation Monitoring and Evaluation Matrix. by tapping large corporations to teach the Further, the NIC will establish the Diaspora for different aspects of business operations. It will Innovation Development Program to engage expand access to the One-stop Laboratory high level experts, especially overseas Filipinos. Services for Global Competitiveness, Shared Establish and promote innovation Service Facilities, Advanced Device and Testing hubs and other similar collaborative Laboratory, Electronics Product Development platforms Center, Regional Standards and Testing Laboratories, and other specialized laboratories Establish industry-academe centers that seek for product development and improvement. fundamental, and multi- and interdisciplinary solutions with high societal relevance. These Provide a venue where researchers and industry-academe centers and RIICs will ignite technology developers can meet and pitch their digital transformation as an essential factor products to possible investors or industries. In in innovation and entrepreneurship that can the same way, the venue will also provide a change production and distribution processes, platform for industries and investors to share reduce the cost of entering markets, facilitate market demands and consumer preferences cross-border trade, and provide flexible access where R&D, technology development, and to considerable computing power without innovation can be directed. investing in physical infrastructure. Accelerate the implementation of Increase financing opportunities the Philippine Innovation Act for innovation-related projects or As mandated by the law, the NIC will formulate activities and implement the National Innovation and Motivated by the dynamism of the innovation Agenda Strategy Document (NIASD), which ecosystem, the private sector will operationalize will set the country’s innovation goals and the Mandatory Credit Allocation for provide the strategies and action plans for Innovation Development. The Mandatory improving the country’s innovation governance. Credit Allocation for Innovation Development The Council will also continue to administer under the Philippine Innovation Act provides the National Innovation Fund which aims to ease of access for innovation-related projects, Chapter 8 Advance Research and Development, Technology, and Innovation | 193 especially startups and micro, small, and Increase investments in financial and medium enterprises (MSME). Subject to entrepreneurial literacy applicable regulations of the government, the The private sector will increase investments business and MSME sectors are encouraged to and strengthen programs to enable science avail of loans under this program to invest in and technology startups to make sound innovative and market-oriented technologies. financial decisions and expand their business development skills. It will share financial and entrepreneurial expertise by providing trainings on finance and entrepreneurship. Legislative Agenda Table 8.1 presents the priority bills of the 19th Congress to advance R&D, technology, and innovation. Table 8.1 Legislative Agenda to Advance R&D, Technology, and Innovation RESPONSIBLE LEGISLATIVE AGENDA RATIONALE/KEY FEATURES AGENCY Basic Research and Development and Knowledge Creation Strengthened Establishing the Virology and Vaccine The creation of the VIP will make the Philippines become globally competitive in the Department of Institute of the Philippines (VIP) field of Science and Technology, particularly in virology, when it comes to detecting, Science and identifying, and responding to viruses that affect our people and our resources. Technology (DOST), Department of Health Providing for a Comprehensive Atomic The bill aims to provide a legal framework that adequately protects public health DOST Regulatory Framework, Creating for the and safety, and the environment against the harmful effects of ionizing radiation; Purpose the Philippine Atomic Regulatory and ensures the safety and security of radiation sources. It also aims to establish Commission, and Appropriating Funds the Philippine Atomic Regulatory Commission which will exercise regulatory control Therefor over the peaceful uses of ionizing radiation, including the production, possession, use, import, export, transport, transfer, handling, and management of radioactive materials Strengthening the National Measurement The bill supports the harmonization of national metrological standards with DOST Infrastructure System Amending Republic international standards, mutual recognition arrangements and statistical controls Act 9236 also known as the National as envisioned in the ASEAN economic integration, the World Trade Organization, and Metrology Act of 2003 and for Other international agreements and covenants, resulting to globally competitive and quality Purposes products and services. Market-Driven and Customer-Centered Research and Development Advanced Promoting the Development of the Bamboo The bill seeks to promote the development of the Philippine bamboo industry through Department of Industry by Strengthening the Philippine policies and programs that promote the planting of bamboo and accelerate the Environment Bamboo Industry Development Council, development of bamboo-based designs and products. It proposes the creation of a and Natural Creating the Bamboo Industry Research and Bamboo Industry Research and Development Center, which is tasked to ensure the Resources, Development Center, Providing Incentives effective implementation of the goals and objectives of the measure through research Department for Bamboo Plantation Development, and and development; and trade and propagation promotion, education, and capacity- of Trade and Appropriating Funds Therefor building initiatives for farmers, processors, designers, and other stakeholders in the Industry, DOST bamboo industry, among others. Technology Adoption, Utilization, and Commercialization Scaled-up Providing for the Development of a National The bill aims to revitalize the SRDP Program, incentivize in-country enterprises, Department Defense Industry through the Strengthening rationalize defense acquisition, and create the Office of the Undersecretary for of National and Revitalizing of the Self-Reliant Defense Defense Technology Research and Industry Development under the Department of Defense Posture (SRDP) Program, Incentivizing In- National Defense. country Enterprises, Rationalizing Defense Acquisition, and Creating the Office of the Undersecretary for Defense Technology Research and Industry Development under the Department of National Defense, and Providing Funds therefor 194 | Philippine Development Plan 2023-2028 RESPONSIBLE LEGISLATIVE AGENDA RATIONALE/KEY FEATURES AGENCY Amending Section 177 and Section 216 The bill seeks to amend the following sections of the IP Code: Intellectual of RA No. 8293, Otherwise Known as the Property Intellectual Property Code of the Philippines, (a) Section 177 to consider rampant digital reproduction of copyrightable works; and Office of the as Amended by RA No. 10372, and for Other (b) Section 216 of the IP Code, as amended, to address increasing concerns on Philippines Purposes secondary liability and online copyright infringement issues, such as those related to P2P networks and ISPs. This bill considers the right of copyright owners to prevent others from copying, uploading, scanning, digitizing, or distributing their creative work. Innovation and Entrepreneurship Accelerated Establishing the Science for Change Program The bill seeks to institutionalize the Science for Change (S4C) Program of the DOST to DOST and Appropriating Funds Therefor address the inadequacies in the field of research and development and to enable the nation to be globally competitive, and equipped to provide knowledge-driven solutions and evidence-based responses in resolving the nation’s challenges. Results Matrix Table 8.2 presents the indicators and targets during the Plan period to advance R&D, technology, and innovation. Table 8.2 Results Matrix: Advance R&D, Technology, and Innovation BASELINE TARGETS RESPONSIBLE AGENCY/ INDICATOR MEANS OF VERIFICATION (YEAR) 2023 2024 2025 2026 2027 2028 INTER-AGENCY BODY Basic Research and Development and Knowledge Creation Strengthened Gross expenditure 0.32 (2018) 0.35 0.40 0.5 0.6 0.8 1.0 Department of Science and DOST on research and Technology (DOST) survey development (R&D) as proportion of gross domestic product Market-driven and Customer-centered Research and Development Advanced Academe-Industry- 64th 62nd 59th 57th 55th 52nd 50th Global Innovation Index (GII) Annual Commission on Higher Government R&D Report Education, DOST, linkages increased Department of Trade and strengthened and Industry (DTI), Department of National Defense, Department of Agriculture, state universities and colleges (SUC) Technology Adoption, Utilization, and Commercialization Scaled-up Percentage increase TBD1 Increasing Final reports from R&D grantees, DOST in public R&D Startup grantees, Products products adopted demonstrated in National Science by users and/or and Technology Week, Philippine commercialized Startup Week, SUC Fairs, regional inclusive innovation centers, DA Fairs Innovation and Entrepreneurship Accelerated Number of TBD2 Increasing Philippine Startup Week participation, DTI, DOST, Department successful startups other government-recognized of Information and startup events/fairs, ISA registry of Communications startups, NDC startup grantees Technology, National Economic and Development Authority (NEDA) GII ranking 59th (2022) 57th 54th 52nd 49th 46th 43rd GII Annual Report NEDA 1 No available immediate data 2 Registration on the Startup Website is still in beta testing phase. Official numbers will be provided based on the number of startups registered. Chapter 8 Advance Research and Development, Technology, and Innovation | 195 1 The GII serves as the global benchmark that measures innovation using seven pillars, namely (a) Institutions, (b) Human Capital and Research, (c) Infrastructure, (d) Market Sophistication, (e) Business Sophistication, (f) Knowledge and Technology Outputs, and (g) Creative Outputs. It ranks the innovation performance of around 132 economies in the world by highlighting innovation strengths and weaknesses. 2 Dutta, S., B. Lanvin, L. Rivera León and S. Wunsch-Vincent (Eds.) (2022). Global Innovation Index 2022 What is the future of innovation-driven growth? Geneva, Switzerland: World Intellectual Property Organization. 3 RTI International-Science, Technology, Research, and Innovation for Development (STRIDE) Project (2019). Philippines Innovation Ecosystem Assessment. RTI International for the United States Agency for International Development. North Carolina: RTI International. 4 DOST Survey on R&D Expenditures and Human Resources in Government, Higher Education and Private Non-Profit Sectors, 2009, 2011, 2013, 2015, and 2018 5 RTI International-Science, Technology, Research, and Innovation for Development (STRIDE) Project (2014). Philippines Innovation Ecosystem Assessment. RTI International for the United States Agency for International Development. North Carolina: RTI International. 6 Inputs and discussion during the Virtual Regional Consultations for the PDP 2023-2028, October 19, 2022. 7 Dutta, S., B. Lanvin, L. Rivera León and S. Wunsch-Vincent (Eds.) (2022). Global Innovation Index 2022 What is the future of innovation-driven growth? Geneva, Switzerland: World Intellectual Property Organization. 8 RTI International-Science, Technology, Research and Innovation for Development (STRIDE) Project (2014, 2019). Philippines Innovation Ecosystem Assessment. RTI International for the United States Agency for International Development. North Carolina: RTI International. 9 “Philippine Innovation Act” declares the policy of the state to foster innovation as a vital component of national development and sustainable growth; Act to Enhance the Digital Workforce Competitiveness aims to ensure that citizens are provided with the necessary digital skills and competencies that are at par with global standards and shall encourage digital innovations and entrepreneurship. The Act aims to provide the necessary infrastructure, and undertake upskilling re-skilling, and training of workforce on digital technology and innovations for employability and competitiveness in the Fourth Industrial Revolution; Innovative Startup Act provides benefits and incentives for startups and startup enablers; Public Telecommunications Policy Act aims to promote and govern the development of Philippine telecommunications and the delivery of public telecommunications services; Science for Change Program (S4CP) Act (Senate Bill No. 1548) seeks for increased budget of PHP 21 billion for R&D (from 5.8B) for 2018, to double yearly for 5 years, capped at PHP 672 billion by 2022. 10 Kim, Jungsuk and Castillejos-Petalcorin,, Cynthia (2020). The Role of Government Research & Development in Fostering Innovation in Asia. Asian Development Outlook 2020 Background Papers. Manila: Asian Development Bank. 11 National Academy of Science and Technology, Philippines (2021). PAGTANAW 2050: The Philippine Foresight on Science, Technology, and Innovation. Manila: National Library of the Philippines. 196 | Philippine Development Plan 2023-2028 09 Promote Trade and Investments CHAPTER 9 Promote Trade and Investments Over the medium term, the trade and investment sectors will be strong and positive contributors to overall national growth. This will require taking more informed risks and making harder choices to propel the country’s global position upward. To meet these ambitions, both the public and private sectors, together with major social partners, will act as one, and powerfully recharge trade and investments as motors of job creation, skills development, and poverty reduction. This chapter presents the challenges facing trade and investments and the twin outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) global position of Philippine export sectors restored, sustained, and strengthened; and (b) total investments increased and targeted to boost trade, skills upgrading, and sustainability. Assessment and Challenges Philippine exports have lost tremendous immediate neighbors, stunted the dynamic ground in the global market (See Figure 9.1), shifts away from low value-added tasks in the averaging only 4 percent growth for the last global value chains (GVC), and limited the two decades while our regional neighbors diversification of the product space toward a have been experiencing exponential growth more complex set of exports. Compared to the in their exports. The inability of the country country’s position in the late 1990s, the overall to exploit the waves of surging foreign direct level of sophistication of Philippine exports is investment (FDI) in the region has resulted much lower in 2021.1 in widening gaps between the country and its Figure 9.1 Philippine export and foreign direct investment performance relative to the Association of Southeast Asian Nations, 2000–2020 (USD billion) Goods Exports Foreign Direct Investment 70.0 300 60.0 250 50.0 200 40.0 30.0 150 20.0 100 10.0 50 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 -10.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Indonesia Malaysia Philippines Thailand Vietnam Indonesia Malaysia Philippines Thailand Vietnam Source: World Bank. World Integrated Trade Solution. https://wits.worldbank.org/ Notwithstanding the sharp drop of trade and (COVID-19) pandemic, the Philippines investment due to the coronavirus disease has managed to increase its exports of Chapter 9 Promote Trade and Investments | 201 goods in 2021 by 5 percent relative to 2019. threaten services jobs that are routine and However, this still puts the country behind have weak creative or interpersonal demand.4 five other Association of Southeast Asian While the Philippines could potentially be Nations (ASEAN) countries. Philippine well placed to exploit the current boom in exports amounted to only 31 percent that of trade in intermediate services, the overall low its closest regional competitor, Indonesia. level of skills ensures that growth will mostly Exports of agriculture have been stagnant at likely be concentrated in few highly urbanized around USD5-6 billion since 2013, which is areas, consequently leading to limited national on average 32 percent that of Vietnam during impact on the rates of productive employment. the same period. Services exports fare better, growing at an average of 9 percent from The main market access barriers today are 2016 to 2019, and ranking fourth in ASEAN, the high standards that exporters must meet behind Singapore, Thailand, and Malaysia.2 in terms of consumer health and safety, However, compared to pre-pandemic levels in environmental protection, and overall 2019, services exports dropped 18 percent in product quality. The country’s relatively 2021. As for FDI, 2021 was a record year that cheap wages are no longer sufficient to carve saw investments reach USD12.4 billion, which a niche in the global market. Enhancing the is 21 percent higher than the previous peak country’s ability to meet such standards is in 2017. Yet, despite what seems to be robust crucial to supporting the efforts of local firms growth, the country still lags behind, ranking to venture into new export markets, and being 7th in FDI flows into ASEAN in 2021. considered as preferred suppliers to lead firms in GVCs. Without know-how and access to The number of jobs that are created by trade and standards and certification testing facilities FDI is difficult to ascertain due to insufficient nationwide, local exporters will be unable or unmatched data, e.g., between the Philippine to exploit premium prices in organic goods, Standard Commodity Classification and the produced according to environmentally and Philippine Standard Industrial Classification socially responsible practices, for instance. data. The latest 2018 enterprise census data A particular concern is the weak or falling indicated that employment (and the number export growth rates of the most firm-populous of enterprises) in sectors linked to exports sectors. The survival of these sectors, such as have fallen or at best, remained stagnant garments, handicrafts, and wooden products, compared to 2012. The List of Establishments is imperative since they have strong domestic reported only a meager 0.2 percent increase in sectoral and labor market linkages. The small enterprises and 0.8 percent net annual Philippines needs to recover competitiveness in increase in medium-sized enterprises from sectors where the country has registered clear 2012 to 2021. This is due to the falling rates comparative advantages in the recent past, as of new entry of firms in the export markets,3 well as maintain the country’s remaining lead and the increasing trend toward automation in the global market (See Figure 9.2). and robotization, which adversely affect the capacity of industry to generate jobs and 202 | Philippine Development Plan 2023-2028 Figure 9.2 Philippine Product Dynamics: New Entry and Permanent Exit of Export Products, 1996–2019 500 400 300 200 100 0 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 new entry permanent exit Note: Estimates based on Harmonized System at the 6-digit level. Source: World Bank. World Integrated Trade Solution. https://wits.worldbank.org/ Public export financing schemes are GVC subsidiaries, which account for more fragmented, insufficient, or inadequately than 60 percent of the country’s exports, are communicated. Despite available financing often well sheltered from market shocks and facilities from the Development Bank of the competitive pressures by their lead firms. Many Philippines, Land Bank of the Philippines, and local firms, however, will not survive in the the Small Business Corporation, a number presence of extensive domestic market failures of Philippine traders still resort to private such as lack of critical infrastructure, access to financing, which carry higher costs and add financing, real-time market information, etc. to their cost disadvantage relative to their foreign competitors. 5 Exporters are relatively The country’s weakening ability to develop low-risk and thus are prime clients of private and retain a skilled workforce. The 2022 banks since they typically supply on invoice Global Talent Competitiveness Index of to trusted buyers (i.e., with repeat orders). INSEAD saw the Philippines ranking 80th The lack of buffers to bridge finance their out of 133 countries (down 10 spots from transactions often leads to undue burden that 2021). This may undermine the country’s impact their production capacities. first-mover advantage in information technology–business process outsourcing Proactive policies that render timely commercial services, and affect its ability interventions and preventive measures to secure high value-added niches in for distressed firms are lacking. In a highly intermediate services. This will also affect competitive global market, even the market the country’s ability to achieve inclusive shares of the country’s strongest home-grown growth. The institutionalization of major FDI export pillars are contestable. Signs of firm reforms in 2022 is expected to significantly distress must be recognized, else the only improve the investment environment, but remaining option is firm closure, which not fundamental problems remain pertaining only leads to job loss but also to the wastage to red tape especially at the level of local of scarce local entrepreneurial capital. Large Chapter 9 Promote Trade and Investments | 203 government units (LGU); insufficient infrastructure (e.g., electricity, transport coordination of investment promotion efforts; networks, telecommunications). These issues scarcity of local suppliers that are able to need to be addressed to raise the attractiveness deliver the necessary quality and scale; and of the country as an FDI destination relative overall high costs of doing business due to to neighboring countries with similar inadequate and inefficient provision of key endowments and level of development. Strategy Framework Amid a crowded policy agenda and limited and domestic markets to drive productive fiscal space, priorities must be made, especially employment, and increase incomes. On the at the national level, and innovation in policy other hand, FDI will be harnessed as drivers approaches are needed, especially at the local of export growth, sources of vital technology, levels (See Figure. 9.3). On one hand, renewed and critical enablers of the country’s long-term focus will be given to the survival, growth, climate action. and expansion of local firms in the export Figure 9.3 Strategy Framework to Promote Trade and Investments TRANSFORM PRODUCTION AND SERVICES SECTORS TO GENERATE MORE QUALITY JOBS AND COMPETITIVE PRODUCTS AND SERVICES PROMOTE TRADE AND INVESTMENTS IN GOODS AND SERVICES GLOBAL POSITION OF PHILIPPINE EXPORT SECTORS TOTAL INVESTMENTS INCREASED AND TARGETED TO BOOST RESTORED, SUSTAINED, AND STRENGTHENED TRADE, SKILLS UPGRADING, AND SUSTAINABILITY Resolve key constraints to export growth and Maximize synergy and decisively align national and local competitiveness government investment promotion strategies Proactively monitor and implement preventive measures and Launch an aggressive “make it happen in the philippines” interventions for distressed firms campaign and raise awareness of the new business climate Implement targeted, more granular strategies to increase ushered in by most recent structural reforms exports on three fronts: global value chain (GVC) export Leverage the Strategic Investment Priority Plan (SIPP) clusters (industrial, manufacturing, and transportation [IMT], Heighten the country’s attractiveness for foreign direct technology, media, and telecommunications [TMT], and investments (FDI) by developing unique locational assets health and life sciences [HLS]); food and agri-marine; and especially in the rural areas labor-intensive manufacturing Position the Philippines as a prime destination of foreign Significantly diversify exports by fortifying the sectoral investments against climate change or environmental, social, backward and forward linkages and governance (ESG) investments Advance purposive, assertive, and forward-looking Regional Trade Agreements strategies Re-configure public-private social partnerships to build Position the Philippines as the foremost supplier of tradeable strong collaboration infrastructure that will serve common intermediate services investment promotion campaigns, and longer-run joint Ensure integrated, whole-of-government commitment to strategies to improve the country’s business climate deliver broad access to National Quality Infrastructure Integrate private and public efforts to develop the country’s unique selling proposition and its positioning 204 | Philippine Development Plan 2023-2028 Strategies Outcome 1: Global position of Philippine export sectors restored, sustained, and strengthened Resolve key constraints to export market information sharing to and from trade growth and competitiveness and agricultural attaches, and diplomatic posts. The country’s high-cost business environment Proactively monitor and implement due to high electricity costs and logistics costs preventive measures and relative to other ASEAN countries must not interventions for distressed firms be further saddled by unnecessary regulatory costs. The government will therefore ensure The government will design and implement tight collaboration with LGUs (this will an effective Early Warning System;7 Rapid be a special focus of the Anti-Red Tape Assistance mechanisms; and farsighted Authority), stricter timeframe for resolving preventive measures to support export pillar exporters’ issues to reduce exporters’ costs, sectors as well as micro, small, and medium full implementation of the TradeNet platform, enterprises (MSME), which are in critical and institutionalization of a dedicated unit to stages of transition (e.g., local to foreign oversee the implementation of the National markets; scale shifts). This requires immediate Single Window. To facilitate the flow of trade in solutions to the information bottleneck goods, the government will review, identify, and caused by existing data confidentiality recommend the removal of regulatory measures laws and fortressed data silos within the that have become irrelevant, trade-restrictive, government. In the meantime, the Philippine and costly or burdensome in doing business. Statistics Authority will ensure the updating The government will also capacitate exporters of its merged Trade Transaction and Firm to increase their online presence and make use Survey database, which will be the basis for of digital platforms6 that will increase market distinguishing more granular firm typologies presence of Philippine goods and services. The and monitoring the health of local firms, government will likewise review the efficacy particularly exporting firms. Armed by such of existing financing facilities to further lower firm typologies, the Department of Trade exporters’ costs and raise their competitiveness. and Industry (DTI) will be able to determine the reasons behind the weak survival and The provision of real-time market information falling net entry of firms in the export is a critical assistance for the country’s markets, and to identify unnecessary cost exporters. The Tradeline Philippines will be pressures (e.g., informal fees in ports and revamped and given more resources to enable LGUs). This will be the basis for developing the platform to identify emerging products customized programs, especially for sectors and market opportunities; better capture and firms in distress, as well as support information on local suppliers and their measures to assist exporters in maximizing capabilities; and create a dedicated space for opportunities in key markets. Chapter 9 Promote Trade and Investments | 205 Implement targeted, granular Significantly diversify exports by strategies to increase exports fortifying the sectoral backward and on three fronts: global value forward linkages chains, food and agri-marine, and The shrinking export product space will be labor-intensive manufacturing transformed by identifying and supporting Multiple priorities signal no priorities; thus, local firms that have trigger roles in linking strategies will be further sharpened to make upstream and downstream sectors in the them credible for local and foreign investors. economy. The agri-processing sector, for Given the tight fiscal space for the provision of instance, is populated by these types of incentives and subsidies, the government will firms. Middle-sized enterprises, for instance, draw the most specific information possible often fall through the policy cracks,8 to identify concrete entry points for local explaining their trivial net 0.8 percent annual firms in GVCs (industrial, manufacturing, increase in number. and transportation; technology, media, and telecommunications; and health and The servicification of manufacturing and life sciences). This entails the scanning of agriculture has now been known to increase opportunities benchmarked on an in-depth the competitiveness of exports.9 This will (and honest) analysis of the country’s entail the expansion of government agencies current skills set and not only on the assistance and work toward implementing GVC’s technological profile. The Philippine these in the regions, such as DTI’s Shared Export Development Plan will outline the Services Facilities to include common specific strategies to promote development business services (e.g., marketing, of identified sectors. digitization, administrative and finance, promotions, logistics, distribution, assistance Due to the utmost goal of generating jobs, in consolidation), especially for MSMEs and especially for unskilled workers, renewed cooperatives with potential export transitions. focus and targeted support programs will be Value chain interventions will go beyond implemented for agri-marine-based and labor- mere provision of physical inputs but focus on intensive manufacturing, such as processed organizational development, and brokering food and garments. Problem-oriented multi-sectoral partnerships to capacitate coordination mechanisms, especially in smallholders and make value chains inclusive. the rural areas to address context-specific bottlenecks, will be actively utilized as an Concrete indicators will be developed to approach to resolve these constraints as well as gauge the ability of local suppliers to replace address general problems of inadequate access a significant share of inputs imported by to financing and insufficient provision of GVC subsidiaries. This requires: (a) firm agricultural extension to transform antiquated and sector analysis based on the least production practices. cost disadvantage relative to benchmark estimates of foreign competitor positions; and (b) close collaboration with the private sector, 206 | Philippine Development Plan 2023-2028 particularly with professional specialists’ puts the competitive position of our local groups (e.g., engineers, research and manufacturers at risk, especially vis-à-vis development practitioners). countries with an FTA with the EU (e.g., Vietnam). The government will therefore Advance purposive, assertive, actively seek derogations for EU GSP+ and and forward-looking free trade similar mechanisms (e.g., cumulation), agreement strategies pursue liberal rules of origin for products A Free Trade Agreement (FTA) Sustainability of interest, and seek inclusion of export Impact Assessment and FTA Utilization pillars in zero tariffs product liberalization System will be institutionalized and led by the of countries’ FTAs. DTI to define short-, medium- and long-term Conformity to technical regulations and opportunities in specific sectors and markets sanitary and phytosanitary standards usually as well as provide easy access for timely data comprise an important hurdle for exports to on trade in goods and services and utilization enter foreign markets. This challenge will be of Philippine FTAs. The assessment will aim transformed into an opportunity by using FTA to scan other potential high-impact FTAs and partnerships to help the country strengthen its other related trade agreements, highlighting National Quality Infrastructure (NQI) to the specific areas where these may act as catalyst benefit of local producers. The government will for facilitating trade and investments from negotiate sharing of knowledge, technology, target-source countries. This assessment and best practices to comply with standards will also identify possible stakeholders and in foreign markets and maximize the market industries that will be adversely affected access offered through FTAs. and accordingly formulate safety nets for these sectors. The system, on the other hand, Position the Philippines as the will assist government and relevant private foremost supplier of tradeable stakeholders in designing programs and intermediate services activities to promote FTAs and optimize utilization by exporters. The country has a first-mover advantage in some tradeable services sectors in the region Trade negotiations will be employed as a and makes it well-placed in being a hub for decisive tool in pushing the frontiers of sectors with high creative and interpersonal our markets as defined by current origin demand. This would entail a credible and rules. FTA negotiations will also be utilized coordinated commitment both from the to distinguish between legitimate and private and public sectors to invest in the trade-restricting non-tariff measures. rapid development of digital skills in order The double transformation rules of origin to build a concentration of digital talents in requirements of the European Union (EU) the country. To secure first-mover gains and hampers the local garments sector’s utilization take advantage of future lucrative niches in of the highly advantageous EU Generalised creatives and digital skills, the government, in Scheme of Preferences+ (EU GSP+). This close partnership with the private sector and Chapter 9 Promote Trade and Investments | 207 academe, will identify where the first-mover Ensure integrated, advantages in these sectors lie so these areas whole-of-government commitment could be developed and appropriate support to deliver broad access to the mechanisms designed for firms in these sectors. National Quality Infrastructure The country’s large pool of young digital talents Exports, as well as products geared toward is a huge asset that needs to be harnessed domestic consumers, must be embedded with by collaborative (regional) strategies. The more technology, innovation, and skills in government, by mobilizing its regional growth order for local firms to win market shares in centers, will create a visible concentration of both global and local markets. The government digital savvy pool of talents in various parts of will definitively integrate and harmonize the country. This will entail tight partnerships national standards and certification policies, among industry players, knowledge institutes, and agencies in order to open up the path LGUs, and the national government. for many local firms (especially SME) toward Studies predict that the prime mover of quality-exigent foreign markets. In this regard, efficiency-seeking foreign investments will the government will strongly pursue passage increasingly be the availability of digital hubs of the NQI Act and direct relevant agencies instead of mere low-cost production centers.10 to address institutional fragmentation Moreover, since local digital talents are being and pursue adoption of harmonized aggressively poached by other countries, new quality infrastructure. incentive measures will be designed to try and arrest this trend. Outcome 2: Total investments increased and targeted to boost trade, skills upgrading, and sustainability Maximize synergy and decisively facilitation strategies are fit-for-purpose, given align national and local government the current market realities and demands. investment promotion strategies Pioneering enterprises and promising startups that utilize advanced technologies will be the The establishment of the Inter-Agency primary drivers of job creation and innovative Investment Promotion Coordination entrepreneurial culture in the Philippines. Committee under the Amended Foreign Investments Act (Republic Act 11647) Launch an aggressive branding will be hastened in order to integrate all campaign and raise awareness of the the promotion and facilitation efforts to new business climate ushered in by encourage foreign investments and make most recent structural reforms the new investment environment credibly With the institution of major FDI reforms in improved for investors. Strong government 2022, an all-out campaign is needed to bring partnership with the private sector is critical across the message that a new FDI regime exists, to ensure that investment promotion and making the country truly open for business. The 208 | Philippine Development Plan 2023-2028 government will maximize the opportunities bring investments to the countryside. Focus opened up by the Corporate Recovery and must be given on capacitating LGUs in Tax Incentives for Enterprises (CREATE) making their localities investment-ready and Act, the amended Foreign Investment Act investor-friendly, leveraging on the presence (RA 11647), the Retail Trade Liberalization of growth opportunities, minimal market Act (RA 11595), and the Public Service Act saturation, and absence of congestion and (RA 11659), through local and international pollution compared to urban areas. user-friendly information dissemination programs, and coordinated communications The government will examine unique campaign done in collaboration with the public–private partnership (PPP) transaction private sector and social partners. However, arrangements with the private sector, especially an equally strong internal campaign is likewise for the agriculture and fisheries (A&F) sector. needed, especially among LGUs. This will be carried out not only at the national level (for what can be considered “big ticket” Leverage the Strategic Investment A&F PPPs), but also PPPs in the A&F sector Priority Plan that have more localized focus. Promotion of the Strategic Investment The Local Economic Development and Priority Plan (SIPP) through sector-focused Investment Promotion Offices in all LGUs and company-specific promotion in (province, cities, and municipalities) will be target markets will be intensified. The institutionalized to facilitate and coordinate implementation of SIPP, pursuant to the local economic development and investment CREATE Act, will incentivize highly attractive promotion advocacies, policies, programs, investments and will yield more diversified, projects, and activities. complex, and sophisticated products and services in the country. This will likewise Position the Philippines as a be monitored by an Early Warning System, prime destination of foreign especially to help increase the realization rates investments against climate change of approved investments. or environmental, social, and governance investments Heighten the country’s attractiveness to foreign direct The world’s biggest companies have been investment by developing unique building up their investment funds to offset their locational assets, especially in the carbon footprints, in the form of carbon credits, rural areas as failure to do so may arrest their production growth. There is also an increasing number of The role of domestic investor firms especially firms that are linking their financial returns in rural areas in drawing foreign partnerships with environmental, social, and governance in greenfield investments will be strengthened. norms as a part of their business operations and To support the thrust toward regional long-term sustainability strategies. This poses a development, there is a need to reinvigorate huge opportunity for the Philippines that could investment promotion in the regions to offer environmental, social, and governance Chapter 9 Promote Trade and Investments | 209 (ESG) investment opportunities, specifically in Natural Resources, DTI–Board of Investments, the areas of reforestation combined with food Department of Finance, Department of Social security and sustainable livelihood for buffer Welfare and Development, Department of the communities. At present, the Philippines does Interior and Local Government, Department not have a carbon pricing instrument but studies of Energy, Climate Change Commission, and have been conducted in coordination with Philippines Space Agency), private sector, the World Bank. The Innovative Payment for academe, and other social partners. The task Environmental Services (PES) is already being force will spearhead the work in building piloted in the country, offering a more accessible transparent and credible Standards and alternative to the United Nations Programme Certification schemes by stimulating dynamic on Reducing Emissions from Deforestation and institutional entrepreneurship in this arena. Forest Degradation Warsaw Framework, or UN This will be done in close cooperation with the REDD+ schemes, among others. Bangsamoro Autonomous Region government and stakeholders given the availability of large To make the Philippines a prime destination possible reforested land, and the potential of ESG investments in the world, an ESG link with the aim of sustaining the peace Investments Task Force will be established. process, which adds significant value to ESG This will be composed of the public sector investment instruments. (e.g., National Economic and Development Authority, Department of Environment and Legislative Agenda Table 9.1 presents the priority bills of the 19th Congress to promote trade and investments. Table 9.1 Legislative Agenda to Promote of Trade and Investments LEGISLATIVE AGENDA RATIONALE RESPONSIBLE AGENCY Outcome 1: Global position of Philippine export sectors restored, sustained, and strengthened Urgent ratification of the Regional Joining the RCEP will be beneficial to the Philippines to enhance its market Department of Trade and Comprehensive Economic Partnership access and investments. As of date, only the Philippines has not yet deposited Industry (DTI) (RCEP) Agreement its Instrument of Ratification to the Association of Southeast Asian Nations Secretariat. In 2020, RCEP accounted for 30% of the world’s population, 30% of gross domestic product, 29% of trade, and 33% of global inward investments.a National Quality Infrastructure (NQI) Establishment of an NQI will help boost best practices and competitiveness. DTI, Department of Science Act Compliance with standards can be a source of advantage (especially in context and Technology, Development of e-commerce). This will also facilitate secure market access and utilization Academy of the Philippines of free trade agreements. Export and Industry Development Act Amendments to the law will provide targeted and strategic policy, program, DTI and project support, including non-fiscal incentives, for the development of local industries toward export competitiveness. Most of the provisions of the Export Development Act have lapsed already. Outcome 2: Total investments increased and targeted to boost trade, skills upgrading, and sustainability Executive Order (EO) for a whole- Issuance of an EO will provide cross-cutting facilitation services for priority of-government, harmonized, and investments. structured Investment Facilitation Mechanism, including resolution of critical issues and concerns for identified priority investments. a Based on 2020 data (World Bank, ITC TradeMap, UNCTAD World Investment Report). 210 | Philippine Development Plan 2023-2028 Results Matrix Table 9.2 presents the indicators and targets during the Plan period to promote trade and investments. Table 9.2 Results Matrix: Promote Trade and Investments TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION INTER-AGENCY BODY Outcome 1: Global position of Philippine export sectors restored, sustained, and strengthened Merchandise exports 54.2 58.09 61.58 65.27 69.19 73.34 77.74e Bangko Sentral Department increased (USD billion) (2021)a ng Pilipinas of Trade and (BSP) Balance of Industry (DTI) Payments Non-electronics exports 32.16 37 42 48.6 56.1 63.3 70.9f Philippine DTI increased (USD billion)c (2021)b Statistics Authority International Trade Merchandise Statistics Number of commodities 440 480 520 560 600 640 680 World Bank DTI with revealed comparative (2021) World Integrated advantage increasedd Trade Solution database Services exports increased 33.6 42.85 45.42 48.15 51.03 54.10 57.34e BSP Balance of DTI (USD billion)a (2021)a Payments Outcome 2: Total investments increased and targeted to boost trade, skills upgrading, and sustainability Philippine foreign direct 2.7 2–5 2–5 2–5 2–5 2–5 2–5 United Nations DTI–Board of investment (FDI) to gross (2021) Conference Investments domestic product (GDP) ratio on Trade and (BOI) increased (%) Development FDI and GDP data Share of PH FDI to total 6 5–10 5–10 5–10 5–10 5–10 5–10 ASEAN Stats DTI-BOI Association of Southeast (2021) Asian Nations (ASEAN) FDI increased (%) Rank in Organisation for 3rd most Lower Lower Lower Lower Lower Lowerg OECD FDI DTI-BOI Economic Co-operation restrictive Regulatory Development (OECD) FDI (2020) Resrictiveness regulatory restrictiveness Index index improved Green, Social, and 6.33 6–8 6–8 8–10 8–10 TBD TBD Securities Department of Sustainability Bonds issued (Oct 2022) and Exchange Finance increased (USD billion) Commission Sustainable Finance Market Update a Based on BSP Balance of Payments data. b Based on PSA data. c Refers to total exports excluding electronics exports. d Based on Harmonized System at the 6-digit level. e Targets based on DBCC projections approved during the 183rd DBCC meeting on December 5, 2022. f Based on export projections in the draft Philippine Export Development Plan 2023–2028, subject to revision pending approval of draft PEDP. g The OECD FDI Regulatory Restrictiveness Index gauges the country’s statutory restrictions with values ranging from 0 (least restrictive) to 1 (most restrictive). Countries are ranked from least restrictive to most restrictive where higher numerical ranking indicates more regulatory restrictions. Chapter 9 Promote Trade and Investments | 211 1 See Balaoing, A. and A. Mendoza. 2021. Diversification, Jobs and the COVID-19 Recovery: Exploring Opportunities for Economic Diversification and Productive Employment in the Philippines. Makati City: United Nations Philippines. 2 United Nations Conference on Trade and Development; ranking based on 2016–2019 annual average levels. 3 From 88% in 1998 to 12% in 2012 (last estimate available). 4 See this Oxford study on jobs most likely to be automated: Frey, C.B. and M. Osborne. 2018. Automation and the Future of Work: Understanding the Numbers. https://www.research.ox.ac.uk/article/2018-10-15-automation-and-the-future-of-work-understanding-the-numbers. 5 All of the country’s direct regional competitors offer such facility, for example: Export-Import Bank of Thailand, Export Credit Agency in Malaysia, Indonesia EXIM Bank, Export Credit Agency, and Export Credit - Vietnam Development Bank, which are all state-owned. 6 Such as the ASEAN-wide Self-Certification Scheme; ASEAN Single Window; ASEAN Solutions for Investments, Services and Trade; Philippine National Trade Repository; and ASEAN Trade Repository. 7 This includes monitoring of firm-level export growth, firm market shares, and market exits (e.g., product and country destinations); job creation impact of trade and investments; and monitoring of revealed comparative advantage. Information on the geographic location of firms is essential to mobilize provincial and even municipal resources to assist ailing firms. 8 They are too big to qualify for most government aid (especially during the COVID-19 pandemic), and yet too small to accumulate buffers to weather external shocks and competitive pressures. They also often finance their own participation in trade fairs, as well as expensive standards and certification compliance measures. 9 Servicification refers to the increasing use and reliance of manufacturing on services. See, for example: Lodefalk, M. 2015. Servicification of Manufacturing Firms Makes Divides in Trade Policy-Making Antiquated. https://www.diva-portal.org/smash/get/diva2:827797/FULLTEXT01.pdf. 10 See for example, Kearney. 2021. Toward a Global Network of Digital Hubs: The 2021 Kearney Global Services Location Index. https://www.kearney.com/digital/ article/-/insights/the-2021-kearney-global-services-location-index. 212 | Philippine Development Plan 2023-2028 10 Promote Competition and Improve Regulatory Efficiency CHAPTER 10 Promote Competition and Improve Regulatory Efficiency As the country emerges from the coronavirus disease (COVID-19) pandemic, ensuring an open and competitive market economy will be crucial to sustain economic recovery and encourage job creation. Genuine competition and enhanced regulatory efficiency will not only encourage investments and improve infrastructure, but also enable businesses—especially micro, small, and medium enterprises (MSME)—to enter and compete in the market. In turn, market competition and ease of doing business will expand consumer access to affordable, innovative, and high-quality goods and services. Rapid digital transformation of markets poses new challenges and opportunities for competition enforcement and regulation. One challenge is that rapid digital transformation heightens the tendency and ability of large firms with more access to new digital technologies to consolidate market power. Digitalization facilitates easier coordination among market players (but also, possible collusion) using new and powerful algorithms. This creates new cybersecurity and data privacy risks given the increased use of and access to personal data. Nevertheless, digital technologies enhance competition, thus enabling smaller firms to compete against larger ones, increasing access of citizens to previously out of reach markets. The Philippine Development Plan 2023–2028 emphasizes the full implementation of the Philippine Competition Act through strategies that allow businesses to leverage existing or emerging digital technologies. It will help businesses become more agile, innovative, and competitive by fostering an environment where anticompetitive practices are prevented or penalized, entry and re-entry of players are facilitated, and strategies to promote innovation are supported. Assessment and Challenges Developments in competition policy and In July 2020, the National Economic and regulatory efficiency. Since the enactment of Development Authority (NEDA) and the Republic Act 10667 otherwise known as the PCC issued Joint Memorandum Circular Philippine Competition Act (PCA) in July (JMC) 01-2020 on the National Competition 2015, significant strides in the enhancement Policy (NCP). Giving more teeth to the JMC, of market competition have been achieved. Administrative Order No. 44, series of 2021 The Philippine Competition Commission was subsequently issued in October 2021. AO (PCC) created under the PCA has conducted 44, s. 2021 mandates a whole-of-government more than 200 merger reviews, and imposed effort in fostering competition through three remedies on transactions in various trades key elements: (a) pro-competitive policies and and industries. It was also able to prevent government interventions; (b) competitive several businesses from entering into neutrality; and (c) enforcement of anticompetitive agreements. competition-related laws and policies. It Chapter 10 Promote Competition and Improve Regulatory Efficiency | 217 likewise provides that compliance with the corporations. Amendments to the Foreign NCP be integrated in the criteria used in the Investments Act (RA 11647) and the Public grant of Performance-Based Bonus (PBB) for Service Act (RA 11659) followed in 2022. The government personnel and in the conferment Foreign Investments Act liberalizes the practice of the Seal of Good Local Governance (SGLG) of certain professions, while the Public Service on local government units (LGU). Act allows full foreign ownership of public services such as telecommunications, railways, Moreover, economy-wide and cross-sectoral expressways, airports, freight forwarding, reforms were instituted to improve the ease of and shipping. doing business and eliminate barriers to the entry of domestic and foreign investments. Several pro-competition developments The Anti-Red Tape Authority (ARTA), in key sectors are also noteworthy. The created in 2018 through the Ease of Doing government passed the Mobile Number Business and Efficient Government Service Portability Act (RA 11202) in 2019 and the Delivery Act (RA 11032 or EODB-EGSD), led common tower and pole policies in 2020 efforts to reduce the burden of regulations. to expand the space for competition in the Its flagship program, the National Effort for telecommunications sector. The retail supply the Harmonization of Efficient Measures segment of the electricity sector was opened of Inter-related Agencies (NEHEMIA), to competition. In construction, a 2020 greatly reduced the time, permits, and other Supreme Court decision struck down the rule requirements needed in the information imposing a nationality-based restriction on and communications technology (ICT), the licensing of foreign contractors. Finally, construction, food, pharmaceutical, logistics, the Rice Tariffication Act of 2019 (RA 11203) and energy sectors. ARTA also released several introduced several reforms that are expected to manuals to improve regulatory efficiency of reduce barriers to the importation of rice and government agencies, such as the Philippine curb government intervention in the rice market. Good Regulatory Principles, the Regulatory Impact Assessment Manual, and the National These reforms are expected to boost the Policy on Regulatory Management System country’s competitiveness; however, the (NPRMS). As of June 2022, 784 LGUs have Philippines still declined in the 2022 Global already implemented the Electronic Business Competitiveness Index (GCI) rankings from One-Stop Shop and 563 cases have been filed a percentile rank of 59 in 2016 to 55 in 2019. against fixers and public employees found in This suggests that more effective regulations violation of EODB-EGSD. are needed to strengthen market competition and improve regulatory efficiency. Based on Meanwhile, Congress has also enacted landmark the World Bank’s Entrepreneurship Database, legislations to attract foreign investment and business entry in the Philippines remains participation in the economy. A law amending limited, with an average of three newly the Retail Trade Liberalization Act (RA 11595) registered businesses per 10,000 working was enacted in December 2021, which lowers people between 2016 and 2020. Such rate the minimum paid-up capital for foreign is among the lowest in the Association of 218 | Philippine Development Plan 2023-2028 Southeast Asian Nations (ASEAN), indicating Impact of pandemic and prospects for that there is much room to improve the rate of recovery and competition. The exit of many new firm entry in the Philippines. MSMEs due to the COVID-19 pandemic was worrisome from a competition standpoint as Despite the above reforms, several constraints the reduction in competition from smaller to competition and regulatory efficiency also players could enable larger incumbent firms continue to undermine consumer welfare and to become even more dominant. While the market efficiency. Enforcement of competition total number of establishments increased law and policy has not yet fully addressed from 2018 to 2021, the growth was driven by anticompetitive behavior and practices, micro-enterprises (10%). Small and medium including potential bid-rigging in public enterprises, which are more likely to provide procurement. Direct caps and bans on the stronger competitive constraint to large entry of new firms into some sectors such as dominant firms, declined by 11 percent and 9 transport and logistics still exist. Vertically percent, respectively. In seven out of 18 sectors, integrated incumbents, especially in network the number of MSMEs contracted. MSME sectors such as in telecommunications, growth declined the most in Information and electricity, and railways, can also make the Communication (57%), Education (30%), entry of new firms difficult, if not infeasible. Arts, Entertainment, and Recreation (23%), and in Administrative and Support Service Meanwhile, high administrative burdens Activities (22%).1 Thus, helping MSMEs on startups, such as numerous permits and recover has been central to the stimulus licenses required from multiple agencies, packages passed by Congress. make it costly to enter the market and can unduly constrain business activities. For It should be noted, however, that such short-term example, the excessive requirements needed relief measures extended to businesses can also for business registration and renewal, as well have the unintended effect of distorting the as the unnecessary limitations on the scope playing field and restricting competition. For of activities under these, can prevent the example, the passage of Bayanihan to Recover ease of entry and expansion by small players. as One Act (RA 11494) in September 2020 Price regulations in many markets, including relaxed regulations to help businesses operate the setting of suggested retail prices for basic more efficiently during the pandemic. However, commodities, as well as the imposition of it also curtailed the ability of the PCC to review non-tariff measures in agricultural products, mergers and acquisitions (M&A) below the restrict the ability of firms to compete based on PHP50 billion threshold value for two years, price and to improve efficiency. Beyond these and suspended its motu proprio powers for direct regulations, ambiguous and redundant a year. During this time, potentially harmful requirements as well as the overlapping M&As may have gone unchecked, leading to mandates of regulatory agencies increase increased market concentration whose effects uncertainty and cost of regulatory compliance, on competition will be particularly difficult to making investments less attractive. reverse. Prolonged and widespread lockdowns Chapter 10 Promote Competition and Improve Regulatory Efficiency | 219 also had the unintended consequence of requirement limits the ability of new and small limiting the PCC’s ability to conduct extensive internet service providers (ISP) to build their investigations and dawn raids, advance network and deploy broadband equipment. advocacy and research activities, and monitor The absence of open access policies allows far-flung markets. incumbents to frustrate their competitors’ access to essential facilities. For instance, the The public’s increased reliance on digital 91-year-old Radio Control Law of 1931, which technologies during the pandemic—to governs spectrum use, is obsolete, having been study and work, remain in touch with family passed decades before the emergence of digital and friends, purchase goods and services, technologies. These constraints hamper access to among many other activities—highlighted and lower the quality and speed of broadband in the importance of and turbocharged growth the country, exacerbating inequalities between in the ICT sector. Public clamor ushered urban and rural areas. the approval of some long overdue reforms intended to increase competition and improve Finally, the use of internet and digital regulatory efficiency in the ICT sector, technologies also creates new challenges for including the streamlining of permits to competition enforcement and regulation. speed up telecommunications infrastructure Digital technologies can encourage and rollout, liberalizing satellite access to enable anticompetitive behavior such as: non-telecommunications, and opening (a) the exclusion of potential rivals from the telecommunications to full foreign ownership. use of critical infrastructure; (b) the use of algorithms to facilitate collusion; and (c) the Digital transformation, competition, and preemptive acquisition of up-and-coming regulatory efficiency. Increased use of the players before they have a chance to grow internet and digital technologies also allowed into more competitive rivals. There are also new and small players to reach consumers and new consumer welfare issues such as the access new markets. Studies have shown that security and exploitation of personal and the diffusion of the internet and the adoption of private data collected in the name of efficiency e-commerce can increase competition in goods and improved buying experience. Moving and services.2 Thus, policies that enable broader forward, competition policies and regulations usage and participation in digital ecosystems can shall address these emerging concerns, help enhance market competition. Digitalization balanced against the undeniable value that also provides powerful tools for automation, digitalization creates. paperless transactions, and streamlined processes, and therefore helps reduce abuse of discretion while improving regulatory efficiency. The pandemic also revealed substantial gaps in the country’s digital infrastructure, which has long been undermined by restrictive laws and regulations. The legislative franchise 220 | Philippine Development Plan 2023-2028 Strategy Framework The strategy framework (See Figure 10.1) Firm and consistent enforcement of the recognizes the complementary and mutually PCA and competition-related issuances shall reinforcing relationship that exists between be sustained to discourage and penalize competition and regulatory efficiency on cartel agreements, abuse of dominance by one hand, and digitalization on the other, firms, anticompetitive M&As, and other which ultimately leads to enhanced consumer anticompetitive behaviors. Reducing barriers welfare and market efficiency. The adoption of to entry and re-entry by adopting policies that internet and digital technologies will enhance promote open and competitive markets and productivity and promote competition. ensure level playing fields will also be pursued. Enhancing competition in the digital markets Finally, enhancing regulatory efficiency will will improve quality, lower costs, and provide help ensure that laws and regulations are greater choice of new technologies and tools implemented in a manner that contributes that MSMEs can use to compete more effectively rather than hampers ease of doing business and thrive in the post-COVID environment. in the country. Figure 10.1 Strategy Framework to Promote Competition and Improve Regulatory Efficiency CONSUMER WELFARE IMPROVED MARKET EFFICIENCY IMPROVED ANTI-COMPETITIVE BARRIERS TO ENTRY AND BURDEN OF REGULATION PRACTICES DIMINISHED RE-ENTRY REDUCED REDUCED Strengthen and expand competition enforcement Expedite the operationalization of recent Expedite efforts to automate and streamline economic liberalization reforms (e.g., Public Service processes for business registration, renewal, closure, Leverage research and development efforts to identify Act, Retail Trade Liberalization Act, and Foreign and pivot and address competition and regulatory issues in Investments Act) Eliminate redundant, duplicative and priority sectors Enable open access to essential infrastructure facilities overlapping regulations in key sectors Develop framework for the determination of Establish the Philippine Ease of Doing Business significant market power (SMP), and the specification Institutionalize the use of Competition Impact Reporting System of obligations on entitles with SMP Assessment Manual/Toolkit Implement the National Policy on Regulatory Management System Ensure compliance with the Philippine Competition Owners of essential facilities/resources to grant fair, Enforce the separation of regulatory and propriety Act (PCA) through adoption of competition reasonable and non-discriminatory terms of access activities of government-owned and controlled compliance programs corporations Business to volunteer as Anti-Red Tape Authority Champions ADOPT A WHOLE-OF-GOVERNMENT APPROACH TO STRENGTHEN MARKET COMPETITION Pursue full implementation of the National Competition Policy Increase awareness, understanding, and support for the PCA and Philippine Competition Commission PROMOTE COMPETITION AND IMPROVE REGULATORY EFFICIENCY IN AND THROUGH DIGITAL TECHNOLOGIES Enhance monitoring and understanding of emerging technologies, markets, and business models Expand access to broadband internet and digital technologies to enhance consumer choice and facilitate digitalization and innovation among micro, small, and medium enterprises Adopt policies to improve competition and regulatory efficiency in digital markets Chapter 10 Promote Competition and Improve Regulatory Efficiency | 221 Strategies Outcome 1: Anti-competitive practices diminished Strengthen and expand particularly PCC, DOJ-OFC, NBI, and investigation, detection, and National Prosecution Service, Department of prosecution of anticompetitive Trade and Industry (DTI), and other relevant conduct and agreements enforcement agencies. These agencies will work together to harmonize and clarify Government agencies with competition-related their mandates, tasks, and responsibilities mandates will continue to build human under their respective charters, and ensure resources and institutional capacity to enforce accountability. They will also jointly identify the PCA and other related issuances. With and work with Congress to harmonize and the interagency arrangements firmly in place address any inconsistencies that may exist to foster cooperation and coordination in the among their respective charters and other investigation and prosecution of cartels, the laws, including but not limited to the PCA, PCC and the Department of Justice (DOJ), the Consumer Act (RA 7394), the Price Act through its National Bureau of Investigation (RA 7581), and the Electric Power Industry (NBI) and Office for Competition (OFC), will Reform Act (RA 9136 or EPIRA). continue to work together and complement each agency’s resources and competencies. With the resumption of the PCC’s full power to review M&As in September 2021, the Enforcement actions against anticompetitive Commission will undertake the efficient conduct and agreements will be ramped review of notified transactions and expedite the up to strengthen fair competition, deter motu proprio review of completed transactions anticompetitive practices, and bolster the to ensure legal certainty for businesses that reputation and credibility of the PCC and merged but face the risk of having their other agencies with competition mandates. transactions clawed back. To detect bid-rigging activities effectively, the PCC, in coordination with the Government The merger review framework will also Procurement Policy Board, will continue be enhanced to monitor and prevent to strengthen the Bid-Rigging Intelligence anticompetitive acquisitions of nascent Gathering and Detection Enforcement project. competitors by larger incumbent players. In This project will facilitate the use of data-driven both enforcement and merger review, the PCC tools to flag and identify suspicious patterns in will address new digital-specific issues that public tenders. could have an adverse impact on competition, such as the exploitation of data as an essential In addition, a cooperation mechanism will facility, or its misuse as a barrier to entry. The be forged among agencies involved in the agency will be equipped with the knowledge investigation, detection, and prosecution of and analytical tools needed in unraveling “zero anticompetitive conduct and agreements, pricing” and the proper valuation of “data as 222 | Philippine Development Plan 2023-2028 currency” in digital markets. Algorithm-based the PCC and the National Telecommunications discriminatory preferencing, and its Commission (NTC) will ensure fair, consequences for data protection and privacy, reasonable, and non-discriminatory access to shall be coherently addressed in coordination essential facilities and resources controlled with the National Privacy Commission (NPC). by incumbents to improve the digital infrastructure (See Chapter 12) and expand Leverage research and development access to fast and affordable internet services efforts to identify and address (See Chapter 8). In energy, the PCC will work competition and regulatory issues in with the Energy Regulatory Commission priority sectors (ERC) and continue to monitor potential The PCC, NEDA, and DTI will continue to abuses of market power in distribution conduct market studies in sectors or industries and generation to address high rates and such as telecommunications, e-commerce, limited capacity in electricity markets energy, water, health, and food and agriculture, (See Chapter 12). In the agriculture and food where competition constraints are particularly sectors, the PCC and DTI will address issues detrimental given the value and contribution of price manipulation and exploitative pricing of these markets to the economy, other sectors, to protect consumers and support food employment generation, and overall consumer security in the country (See Subchapter 3.1). welfare. Consideration will be given to markets In the pharmaceutical industry, the PCC will that have indications of market concentration continue to monitor and pursue an inquiry into or precedents of anticompetitive behavior. possible anticompetitive practices that may These studies will also identify regulatory exist in the different segments of the supply and competition concerns that need to be chain to ensure competition and improve addressed and actionable recommendations the affordability, quality, and accessibility of to support advocacy campaigns aimed at medicines in the country (See Subchapter 2.1). mainstreaming pro-competition reforms Develop a framework for the in priority sectors or in making the case for determination of significant market launching probes or inquiries into problematic power (SMP), and the specification sectors for potential anticompetitive conduct. of obligations on entities with SMP The PCC, Department of Information and Communications Technology (DICT), NPC, Market power or dominance in and of itself, DOJ-OFC, DTI, and ARTA will continue to without badges of abuse, is not proscribed build their institutional and human resource under the PCA. However, market power, capacity to assess competition and regulatory particularly if significant, may necessitate the issues arising in fast-evolving digital markets. imposition of obligations to prevent abuse of dominance that are not applicable to The government will continue ongoing other players. The PCC will work with sector research and action to address competition regulators to develop frameworks, including and regulatory issues in specific sectors of the guidelines and principles, to define and economy. For instance, in telecommunications, determine the existence of SMP in key markets Chapter 10 Promote Competition and Improve Regulatory Efficiency | 223 identified for the purpose of ex ante regulation, private sector players. It will develop and if necessary. The framework shall also provide promote competition compliance toolkits, guidance for when, what, and how to impose and partner with national and regional obligations on entities with SMP to protect associations and chambers of commerce and competition in any given sector. industry to expand private sector awareness and understanding of competition laws. It Ensure compliance with the will operationalize Section 26 of the Revised Philippine Competition Act through Corporation Code (RA 11232), which adoption of competition compliance provides the PCC with authority to impose programs qualifications or disqualifications on directors, The PCC will prioritize the adoption of trustees, or officers of corporations to promote competition compliance programs to provide good corporate governance, or as a sanction in guidance and prevent anticompetitive its administrative proceedings. agreements and behavior by and among Outcome 2: Barriers to entry and re-entry reduced Expedite the operationalization local ISPs in the country’s remote islands and of recently enacted economic rural areas, which are typically left unserved liberalization reforms or underserved. This will also benefit foreign players, encouraged by the amended Public The government, through the appropriate Service Act, who may wish to enter the agencies and sector regulators, will issue rules Philippine market and compete with their and regulations to enforce the recently enacted own network infrastructure. amendments to the Public Service Act, and fully implement the Foreign Investments Act The DICT and NTC will promote infrastructure and the Retail Trade Liberalization Act. sharing, including of government assets, by working with private owners of essential Enable open access to essential facilities. They will issue policies to ensure that infrastructure facilities in key sectors all players in the ICT sector are assured of fair, The government will pursue the enactment reasonable, and non-discriminatory terms to of the Open Access in Data Transmission access essential facilities. Bill to liberalize the telecommunications and broadband sectors further by removing the In the energy sector, the ERC will hasten the full legislative franchise requirement for players to implementation of the Retail Competition and build their own network and gain access to the Open Access, as provided under the EPIRA, country’s spectrum resources. An open access which will enable households to choose their policy is especially important for smaller and preferred electricity provider (See Chapter 12). 224 | Philippine Development Plan 2023-2028 Institutionalize the use of the implementation of the Revised Philippine Competition Impact Assessment Government Internal Audit Program. Manual/Toolkit among government agencies and local government units Owners of essential facilities and/or resources to grant fair, reasonable, Even with the passage of the PCA and the and non-discriminatory terms of issuance of the NCP, restrictive laws and access regulations that impede competition have remained in place in various sectors. The PCC, The absence or delayed implementation of ARTA, and NEDA will work to harmonize and important policies to ensure open access in mainstream the use of a Competition Impact network sectors creates an unlevel playing field Assessment Manual/Toolkit in the law-making as smaller competitors or potential entrants are process of Congress and the policy- and hampered in their access to essential facilities rule-making processes of other government controlled by incumbents. agencies, sector regulators, and LGUs. This is To promote and strengthen competition, the to ensure that laws, policies, regulations, and government shall work with the private sector other issuances pose the least harm to market to ensure open access at fair and reasonable competition and allow the review and repeal of prices to essential or bottleneck facilities, existing regulations that are anticompetitive. especially in sectors where duplication of The PCC will also work with the Department such facilities by new or smaller entrants is of Budget and Management (DBM) to include impractical or infeasible, such as in railways, the Competition Impact Manual/Toolkit in telecommunications, and broadband. Outcome 3: Burden of regulation reduced Expedite efforts to automate and sharing of data among LGUs and NGAs; streamline processes for business (b) allow digital payment of registration fees; registration, renewal, closure, and and (c) issue electronic certificates, permits, pivots and licenses. The Philippine Business Hub will facilitate ease of compliance with the regulatory National government agencies (NGA) and and licensing requirements covering the full LGUs will fully implement existing government life cycle of a business from initial registration programs on the automation and streamlining to closure, as well as in facilitating necessary of government services. This includes the changes to business purpose, or pivoting of adoption and implementation of integrated operations to respond to opportunities or LGU and NGA processes into the Philippine challenges in the market environment and to Business Hub (formerly Central Business encourage and facilitate the entry and re-entry Portal) and Philippine Business Databank of MSMEs, especially as the economy recovers to receive applications and capture and store and moves forward from the pandemic. application data involving business-related platforms. This will (a) enable information Chapter 10 Promote Competition and Improve Regulatory Efficiency | 225 Eliminate redundant, duplicative, and Implement the National Policy on overlapping regulations Regulatory Management System NGAs and LGUs, with the guidance of the The National Policy on Regulatory ARTA and DICT, will expedite the elimination Management System is a set of policies, of redundant and superfluous permits institutions, processes, tools, and standards and licensing steps, automate procedures, employed by the government as a whole to promote paperless transactions, and ensure pursue and maintain good quality regulation that regulatory fees are transparent, just, in the country. A common framework on reasonable, and based only on the actual cost good regulatory practice at all stages of incurred by the government in providing the regulatory life cycle—from inception, the service. ARTA will continue to take a implementation, and eventual repeal of whole-of-government approach to minimize regulations—will facilitate regulatory as well as eliminate redundant, duplicative, efficiency and coherence across NGAs and and overlapping regulations. It will continue LGUs. Toward this, the government will build Program NEHEMIA for priority sectors, its capacity to implement the NPRMS. The including transportation, telecommunications Philippine Business Regulations Information infrastructure, and financial technology. The System, a web-based platform that ensures the Development Academy of the Philippines dissemination of and access to information on (DAP), NEDA, and DBM will continue to regulatory management system and changes implement the Modernizing Government in laws and regulations relevant to the public, Regulations Program, which examines will also be rolled out and implemented. regulations with the goal of streamlining unnecessary rules, reducing compliance costs, Enforce the separation of regulatory and constantly improving good regulatory and proprietary activities of practices across NGAs and LGUs. government-owned and controlled corporations Establish the Philippine Ease of Doing Business Reporting System The government will enforce the separation between the regulatory and proprietary The government will establish and fully activities of government-owned and implement the Philippine EODB Reporting controlled corporations (GOCCs) under the System. This will feature a localized GOCC Governance Act of 2011 (RA 10149) methodology and criteria to measure the to ensure that GOCCs are subject to the same quality of regulatory practices of government regulatory framework as private companies. agencies in relation to their adoption of the To this end, the Government Commission for Philippine Good Regulatory Practices and GOCCs (GCG) and other relevant agencies, the compliance of government agencies with in consultation with the PCC, will work with the provisions of the EODB-EGSD Act. It government agencies whose legislative charters will establish a baseline system of identifying provide for dual regulatory and proprietary and reporting EODB reform initiatives of the functions, to review their mandates and ensure government and determine incentive systems that structural measures are in place to limit for performance targets and measurements. 226 | Philippine Development Plan 2023-2028 potential conflicts of interest in their exercise companies. ARTA shall expand its roster of of regulatory functions. private sector champions and volunteers, who are authorized to receive complaints in Businesses to volunteer as Anti-Red relation to EODB-EGSD and help promote Tape Authority champions and raise awareness on ARTA initiatives. It shall also partner with academic institutions to The government shall continue to work with augment the agency’s reach in promoting ease the private sector and the academe to adopt of doing business and anti-red tape practices a whole-of-nation approach to eliminate red in the country. tape in the government as well as in private Cross-Cutting Strategies Adopt a whole-of-government approach to strengthen market competition Pursue full implementation of the to GOCCs in the form of regulatory treatment, National Competition Policy tax exemptions, and other state support measures will be reviewed, and removed if All government agencies will review their warranted, to ensure that GOCCs do not enjoy existing policies and regulations and identify undue competitive advantages over private issuances that restrict competition in markets, market participants. hinder the entry of new players, facilitate collusion, or provide undue advantage to The mandates of GOCCs will also be reviewed specific firms. Such policy and regulatory to rationalize direct state participation in restrictions on competition will be assessed the economy. The GCG will provide clearer in the context of the market dynamics of guidelines on where the presence of GOCCs is each industry and addressed by appropriate justified, and where state participation should competition-enhancing corrective measures. be minimized by providing a framework National government agencies, regulatory that clearly delineates between commercial agencies, and LGUs will be encouraged to utilize (i.e., sectors where open private competition the free online training courses developed by is viable) and non-commercial (i.e., sectors the PCC on the NCP. These training courses where GOCCs or concessionaires are justified aim at developing the government’s capacities in having exclusive rights) activities or sectors. in integrating competition principles in policy The framework should lead to the adoption and rulemaking. of an accounting system that differentiates between the costs of the said commercial and The government will also pursue the effective non-commercial activities. implementation of the competitive neutrality principle, which requires that all enterprises The government will capacitate and incentivize face the same set of rules and compete on the active adoption of NCP at the local equal terms. To this end, the benefits granted Chapter 10 Promote Competition and Improve Regulatory Efficiency | 227 government level. Pursuant to AO 44, the contribute to the body of competition research Civil Service Commission (CSC), the Career and knowledge and levers for policy reform Executive Service Board (CESB), and the locally and internationally. Department of Interior and Local Government (DILG), will integrate the adoption of and Given the PCC’s growing role in the field of compliance with the NCP and its key elements competition in the ASEAN region, including as part of the good governance conditions presiding over the negotiations on an ASEAN criteria for the grant of the PBB to government Framework Agreement on Competition, the personnel and the SGLG to LGUs. The CSC, PCC will broker knowledge and cultivate CESB and the DILG, in consultation with the policy dialogue among competition PCC, will clearly define the parameters for authorities, sector regulators, business, and the implementation of the PBB and SGLG other non-governmental actors in the region. incentives. The PCC and LGU leagues will enter It will lead the development of a competition into agreements to facilitate mainstreaming of network among these stakeholders. the NCP and ensure effective coordination Increase awareness, understanding, and consultation in areas of concern. The PCC and support for the Philippine and NEDA will work with the DILG Local Competition Act and Philippine Government Academy to provide adequate Competition Commission capacity building on competition policy for local government officials. To address low appreciation and awareness of market competition in the country, the To enhance technical competence in the PCC will expand its advocacy to build implementation of the NCP, the government alliances of champions in the private sector, will continue to build and leverage its particularly among the business community. institutional linkages with foreign and local Businesses will be encouraged to appoint centers of excellence in fields relevant to Competition Compliance Officers to ensure competition law and economics. The PCC their compliance with the PCA. To develop will continue to implement the Capacity an effective educational campaign promoting Building to Foster Competition Project to competition, the PCC will also highlight the strengthen its institutional capacity and that benefits and gains from competition cases of other agencies with competition-related acted and decided upon by the agency. It will mandates. To develop research in competition continue to engage citizens, especially MSMEs, law and policy in the country, it will continue to play an active role in monitoring and to develop academic centers of excellence, reporting anticompetitive practices through including such a center in the University of various online and offline channels. the Philippines College of Law. The center will provide research grants and enable scholars to 228 | Philippine Development Plan 2023-2028 Promote competition and improve regulatory efficiency in and through the internet and digital technologies Enhance monitoring and understanding to encourage innovations from startups and of emerging technologies, markets, and small firms without excessive regulatory stifle. business models Expand access to broadband Innovations enabled by the internet and internet and digital technologies by emerging digital technologies such as to enhance consumer choice artificial intelligence, Internet of Things, and and facilitate digitalization and blockchain, among others, hold immense innovation among micro, small, and potential for unlocking new markets and medium enterprises delivering new goods and services. These disruptive technologies, however, are prone to The critical importance and transformative a winner-takes-all phenomenon, as evidenced value of internet and digital technologies were by the prominence of Big Tech3 companies and in full display during the pandemic. They the dominance of a few large online platforms, enabled the public to access information and increasing the risk of consumer lock-in and health services, resume work, and continue abuses of market power. their education. Broadband and digitalization also allowed MSMEs to emerge or survive The PCC and sector regulators will keep during this period. abreast of emerging technologies and understand how these can alter markets To build upon this momentum, the DICT will and business models, develop capacity and ensure the continuity and implementation expertise to use data science and analytics, and of the National Broadband Plan to provide learn from the experience of other countries quality broadband throughout the country. The to enhance their enforcement capability PCC will continue to discourage, and where and develop regulatory foresight. The PCC warranted, prohibit exclusivity arrangements will explore the opportunities and risks in between property developers and ISPs to ensure adopting ex ante regulation, while continuing that consumers are able to subscribe to their to build upon its existing ex post enforcement preferred service providers (See Box 10.1). The approach to address competition issues in the DTI will continue and intensify its programs to digital economy. facilitate the digital transformation of MSMEs and conduct capacity-building activities to The agencies will also consider regulatory train MSMEs in digital marketing, digital sandboxes (See Chapter 8), similar to the payments, and cybersecurity, among other Regulatory Sandbox Framework of the Bangko skills and knowledge. Sentral ng Pilipinas. This Regulatory Sandbox Framework allows startups and innovators to offer innovative financial products to a limited number of customers or environment, Chapter 10 Promote Competition and Improve Regulatory Efficiency | 229 Box 10.1. Whole-of-Government Approach to Competition A whole-of-government approach to competition regulation is key to ensuring the promotion of competition in the Philippine economy. For example, several reforms have been passed that freed up access to certain internet facilities toward a more competitive broadband sector. In a 2019 landmark case of the Philippine Competition Commission (PCC), the practice of a condominium developer limiting its tenants’ choice of internet service providers only through one preferred provider was deemed illegal and proscribed by the Philippine Competition Act. Following the case, Enforcement Advisory Letters to other property developers were issued by the PCC in a proactive move to deter similar exclusivity arrangements between developers and service providers. Similar efforts to promote greater competition have successfully been achieved by the PCC acting alone, as well as in partnership with other government agencies and regulators. In 2019, the Common Tower Policy of the Department of Information and Communications Technology (DICT) mandated independent tower companies to lease their towers to telecommunications providers, value-added service providers, and information and communications (ICT) services providers. In 2020, the DICT mandated certain passive telecommunications tower infrastructure to have ample access slots for co-location of active ICT equipment. In 2021, through joint issuances among multiple agencies, including the Anti-Red tape Authority, DICT, Department of the Interior and Local Government, National Telecommunications Commission, and PCC, among others, LGUs were directed to (a) streamline the issuance of permits and licenses for the construction of passive telecommunications tower infrastructure and (b) conduct coordination mechanisms for “dig once’’ efforts in the installation of broadband infrastructure in roads. Also in 2021, via an executive action of the President, a law allowing direct access to satellite systems was passed that allowed both international and domestic providers to build and operate broadband facilities without the need for a congressional franchise. Source: National Economic and Development Authority Adopt policies to improve This policy will facilitate the effective and competition and regulatory efficient use of the country’s spectrum or radio efficiency in digital markets frequencies. It will explore alternative modes to allocate spectrum fairly and efficiently, The government will address competition including the possible use of competitive and regulatory constraints that hinder the auctions, provide rules therefor, and revisit development of digital markets to meet the and rationalize the spectrum user fees table increasing need for digital transformation to provide incentives for greater investment in and improve the country’s ability to leverage network expansion and deployment. growth opportunities during the recovery. The passage of open access and competition- These policies shall be complemented by the enhancing spectrum policies will be prioritized amendment or repeal of increasingly obsolete to provide affordable broadband all over the laws, which are ill-suited for the regulatory country, especially in geographically isolated challenges of the digital age, such as the and unserved areas. Public Telecommunications Policy Act of 1995 (RA 7925) and Radio Control Law of the The DICT will issue a comprehensive spectrum Philippines (RA 3846). management policy, which will be implemented by the NTC in consultation with the PCC. 230 | Philippine Development Plan 2023-2028 The PCC, in consultation with the NTC, reasonable and non-discriminatory terms. The will work to address any anticompetitive government will prioritize the enactment of an practices, penalize abuses of dominance, and NTC Modernization Law to equip the NTC facilitate the access of smaller players to the with greater authority and legal protection in incumbents’ essential facilities based on fair, the recall of idle and underused spectrum. Legislative Agenda Regulatory reforms will be pursued to reduce barriers to entry and to strengthen and ensure market competition. Table 10.1 contains priority bills of the 19th Congress during the Plan period to promote competition and improve regulatory efficiency. Table 10.1 Legislative Agenda to Promote Competition and Improve Regulatory Efficiency LEGISLATIVE AGENDA RATIONALE RESPONSIBLE AGENCY National Telecommunications Clearer powers and functions of the NTC in terms of spectrum assignment, recall, NTC, Philippine Commission (NTC) and reassignment. Passing the NTC Modernization Act will provide greater protection Competition Commission Modernization Act for the NTC and strengthen its ability to implement policies effectively through clear and (PCC) enforceable powers to recall, reallocate, and reassign spectrum bands, as well as to regularly carry out spectrum use audits. Open Access in Data Increased competition in the provision of broadband services; efficient, transparent, Department of Transmission Act and dynamic spectrum management. Passing the Open Access in Data Transmission Act Information and will liberalize the telecommunications and broadband sectors by removing the legislative Communications franchise requirement, allowing players to build their own network and gain access to Technology, NTC, PCC spectrum. The law will remove barriers to entry for smaller and local ISPs and new foreign players (See Chapter 6). Consumer Act of the Increased protection for consumers and firms against fraudulent schemes. Philippines (Republic Act Considering the growth of e-commerce, the amendment of the Consumer Act of the 7394) amendment and Philippines, including the imposition of stiffer fines will ensure protection of consumers Department of Trade Internet Transactions Act and firms against fraudulent schemes, including protection against deceptive, unfair, and Industry (DTI), PCC, and unconscionable sales acts and practices, and observance of truth and accuracy in Securities and Exchange advertising. The Internet Transactions Act will protect consumers and firms engaged Commission (SEC) in electronic or digital transactions by improving the regulatory environment for e-commerce (See Chapters 6 and 7). Magna Carta for MSMEs (RA Improved financial support and technical capacity-building programs for micro, small, DTI 9501, amending RA 6977) and medium enterprises (MSMEs). To support the recovery and growth of MSMEs, amendment especially those hit hard by the pandemic, the amendment of the Magna Carta for MSMEs will provide access to support services, including financial support and technical capacity- building programs and reduce barriers to entry of new MSMEs by streamlining permitting requirements. To mainstream competition issues among MSMEs, the Amendment will also include the PCC in the Micro, Small and Medium Enterprise Development Council. Government Procurement Remove preference for domestic entities and bidders in the procurement of goods. Government Procurement Reform Act (RA 9184) Competition in the procurement of goods should be made available to both foreign and Policy Board amendment domestic bidders as well as to products, regardless of where they are manufactured. Require that all government procurement data be provided to or be accessible to the PCC. Chapter 10 Promote Competition and Improve Regulatory Efficiency | 231 Results Matrix Table 10.2 presents the indicators and targets during the Plan period to promote promote competition and improve regulatory efficiency. Table 10.2 Results Matrix: Promote Competition and Improve Regulatory Efficiency INDICATORS BASELINE ANNUAL PLAN TARGETS MEANS OF RESPONSIBLE (YEAR) VERIFICATION AGENCY / 2023 2024 2025 2026 2027 2028 INTER-AGENCY BODY Intermediate Goal: Consumer Welfare Improved Chapter Outcome: Market Efficiency Improved Global Competitiveness Top 45% World Economic Agencies responsible Index (GCI) rank and Score: 61.9 Top 43% Top 41% Top 39% Top 37% Top 35% Top 33% Forum Global with the GCI pillars score improved (2019) 62.1 62.7 62.9 64.3 64.9 65.1 Competitiveness Report (WEF GCR) Outcome 1: Anticompetitive practices diminished Product market rank Top 37% WEF GCR Department of Trade and score improved Score: 57.8 Top 36% Top 35% Top 35% Top 34% Top 33% Top 33% and Industry (DTI), (2019) 57.9 58.2 58.2 58.4 58.6 58.6 Philippine Competition Commission (PCC) Extent of market Top 81% WEF GCR DTI, PCC dominance rank and Score: 36.8 Top 77% Top 74% Top 70% Top 67% Top 63% Top 60% score improved (2019) 37.9 38.7 40.0 42.8 43.2 43.8 Outcome 2: Barriers to entry and re-entry reduced Market size rank and Top 22% WEF GCR DTI, PCC score improved Score: 71 Top 21% Top 21% Top 20% Top 19% Top 18% Top 18% (2019) 71.1 71.1 71.4 71.5 72.6 72.6 New businesses Top 91% World Intellectual DTI, PCC, Anti-Red density rank and score Score: 0.7 Top 89% Top 89% Top 88% Top 87% Top 86% Top 85% Property Tape Authority (ARTA) improved (2022) 0.8 0.8 0.9 1.2 1.2 1.3 Organization Global Innovation Index Outcome 3: Burden of regulation reduced Burden of government Top 73% WEF GCR PCC, ARTA regulation, rank and Score: 33.2 Top 70% Top 67% Top 65% Top 62% Top 59% Top 56% score improved (2019) 33.8 35.0 35.5 37.6 38.9 39.8 Business dynamism, Top 31% WEF GCR DTI, ARTA rank and score Score: 65.7 Top 28% Top 27% Top 26% Top 24% Top 23% Top 21% improved (2019) 66.0 66.1 66.2 67.3 68.7 69.3 Regulatory quality rank Top 45% World Bank ARTA, Development and score improved Score: 0.08 Top 44% Top 44% Top 43% Top 42% Top 41% Top 40% Worldwide Academy of the (2021) 0.09 0.09 0.15 0.17 0.19 0.20 Governance Philippines Indicators Report 232 | Philippine Development Plan 2023-2028 1 Philippine Statistics Authority. 2018 and 2021 Updating of the List of Establishments. Quezon City. 2 V. Jerbashian and A. Kochanova. 2016. “The Impact of Doing Business Regulations on Investments in ICT.” Empirical Economics 50, 3 (May). pp. 991–1008; Rizov, M., M. Vecchi, and J. Domenech. 2022. “Going Online: Forecasting the Impact of Websites on Productivity and Market Structure.” Technological Forecasting and Social Change 184 (November). 3 Big Tech refers to Google, Amazon, Meta, Apple, and Microsoft. Chapter 10 Promote Competition and Improve Regulatory Efficiency | 233 PART IV Enabling Environment 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance CHAPTER 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance By 2040, the Philippines is envisioned to be a prosperous, predominantly middle-class society where no one is poor. In order to push for economic transformation in a post-pandemic context, a favorable business environment is required. A vibrant and healthy financial sector will be encouraged as the Philippines moves closer to becoming an efficient and more inclusive cash-lite economy in the near future. Due to limited fiscal space, national government spending shall also be made more efficient while budget priorities will be aligned with the administration’s socio-economic agenda. These strategies ensure that the development goals outlined in the Philippine Development Plan 2023-2028 will be supported by a stable, active, and sustainable national economy. Subchapter 11.1 Promote an Inclusive, Innovative, and Healthy Financial Sector A vibrant and healthy financial sector is Strong corporate governance and sound risk critical to ensuring a stable macroeconomy. management practices coupled with the ability Subchapter 11.1 presents the strategies to to leverage on digital technology contributed promote the sector’s health, innovation, to the resilience of the sector during the and digitalization. Digitalization will allow pandemic. Digital technology also provided enhanced access by a greater proportion of a more efficient means of distributing social the population to a broader range of financial amelioration programs to formerly unbanked products and services. These strategies will recipients. The pandemic highlighted the move the Philippines closer to becoming necessity of digital technology for the an efficient and more inclusive cash-lite financial sector. economy by 2028. Assessment and Challenges The Philippine financial system remains Center identified the policy of the Bangko sound and stable. The Philippine banking Sentral ng Pilipinas (BSP) as one of the country’s system proved resilient amidst the pandemic. key strengths.1 The industry recovered and The International Institute for Management posted a 7 percent asset growth in 2021. Total Development (IMD) World Competitiveness loan portfolio grew by 4.8 percent in 2021 from Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 239 a 0.9 percent contraction in 2020, while the such as the PESONet3 and InstaPay.4 In non-performing loan (NPL) ratio remained 2021, about a third of retail payments were manageable at 4 percent. Other key financial already digitalized, and the digital economy indicators remain favorable: universal and contributed 9.6 percent to the country’s gross commercial banks’ solo capital adequacy domestic product (GDP).5 ratio and common equity tier 1 ratio stood at Policy framework continues to support 16.5 percent and 15.3 percent, well above the financial inclusion, digitalization, and BSP threshold of 10 and 6 percent, respectively, innovation. Ownership of financial account while liquidity coverage ratio registered at among Filipino adults significantly increased 200.9 percent, above the BSP threshold of from 28.6 percent in 2019 to 55.6 percent in 100 percent, on a solo basis. 2021, well above the BSP’s target of above The Philippine capital markets remain 40 percent. In January 2022, the inter-agency buoyant. In 2021, the Philippine Stock Financial Inclusion Steering Committee Exchange Index accelerated by 7.8 percent (FISC) launched the National Strategy for year-on-year (y-o-y) with market capitalization Financial Inclusion (NSFI)6 for 2022–2028. growth of 13.8 percent. Price-to-earnings The NSFI serves as the country’s blueprint ratio moderated to 21.3 in end-2021 from for financial inclusion toward inclusive 28.5 in end-2020. There were eight initial growth and financial resilience. Meanwhile, public offerings in 2021 and eight so far as of Land Bank’s co-location with the Philippine September 2022. Y-o-y, the Philippines’ total Identification System (PhilSys) registration local currency (LCY) bond stock grew by centers has onboarded over 8.0 million 14.2 percent to PHP9.8 trillion in 2021, mostly unbanked Filipinos as of June 1, 2022. due to government issuances (85.5% of the As part of the implementation of the DPTR, total LCY bond market as of end-2021). the BSP has approved six digital banks, the first The insurance industry is growing and of which was the Overseas Filipino (OF) Bank, remains profitable. Invested assets increased by a government-owned all-digital bank. The 7.9 percent y-o-y in 2021 to PHP1.83 trillion. BSP has likewise institutionalized a regulatory Total net income of the industry grew by Sandbox Framework to evaluate financial 17.3 percent to PHP47.8 billion. technology (fintech) concepts and encourage innovation in the financial system. Early groundwork in digital payments regulatory framework proved crucial in The BSP has been proactive in issuing supporting economic activities during policies concerning cybersecurity, consumer the pandemic. The BSP’s Digital Payments protection, data integrity, and adoption of Transformation Roadmap (DPTR) provided global standards and best practices, among broadened strategies, which are aligned with other key regulations, as well as in continuously the objectives of the BSP-issued National collaborating with the payment industry and Retail Payment System (NRPS)2 in 2017. The other government bodies to improve the NRPS paved the way for the establishment facilities continuously and offer innovative of interoperable digital payment schemes, options for digital payments. 240 | Philippine Development Plan 2023-2028 The innovation by the Department of Finance Despite positive developments in the (DOF) to offer retail treasury bonds, including financial sector, weaknesses and challenges USD-denominated bonds distributed digitally, remain. The digital divide persists. Issues allowed smaller investors to participate in the on trust and confidence in formal financial lending securities capital market. services, especially those offered through digital channels, hamper faster inclusion and The private sector continues to invest in the digital innovation. These are exacerbated by growing fintech industry. Fintech Alliance incidents of fraud and breach of cybersecurity. of the Philippines reports 216 fintech entities The 2021 Financial Inclusion Survey disclosed in the country. The fastest growing segments that income concerns, inadequate documents are mobile wallets, online payments, and wire to support account ownership, and low transfers. It is estimated that there are 54.1 financial literacy rate are the main challenges million active clients in 2021. to opening an account, which is an important Laws passed supportive of financial first step in accessing other financial products inclusion, digitalization, innovation and and services such as savings, investments, health of the financial sector include Personal credit and insurance products. Property Security Act (Republic Act 11057), The annual value of microfinance loans as of the PhilSys Act (RA 11055), Innovative Startup end of 2021 registered at PHP89.3 billion, which Act (RA 11337), Financial Institutions is below the PHP104.7 billion target in the PDP Strategic Transfer Act (RA 11523), Financial 2017–2022 owing to the negative impact of the Products and Services Consumer Protection pandemic, particularly in terms of the decline in Act (RA 11765), National Payment Systems the number of microfinance non-government Act (RA 11127), amendment to RA 7653 institutions’ account ownership. Microfinance or the New Central Bank Act (RA 11211), institutions (MFI) face numerous challenges, and Agricultural, Fisheries, and Rural including weaknesses in the capacity to assess Development Financing Enhancement Act of client over-indebtedness and monitor clients 2022 (RA 11901). efficiently, and the limited digitalization of Strong policy framework and effective financial services.7 government support enabled the financial While the insurance industry grew in terms of sector to achieve seven out of eight assets and net income, the proportion of adults core indicator targets in the Philippine with insurance declined. Likewise, the total Development Plan (PDP) 2017-2022. These number of individuals with microinsurance include the proportion of adults with an coverage decreased. account, financial system’s total assets/GDP, equity market capitalization/GDP (%), LCY For cooperatives, business continuity and bond market as percent of GDP, cumulative resiliency are some of the challenges to be access points per 10,000 adults, microinsurance hurdled. Adoption of technological innovations penetration, and volume of retail e-payments. will enable cooperatives to reduce costs and improve accessibility of services to the members. Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 241 Other challenges remain that need to be to embrace digital transformation fully and addressed to achieve an inclusive, innovative, adopt a “coopetition” perspective to allow and healthy financial sector. Numerous open banking to flourish. The development of documentary requirements for business Philippine capital markets lags behind that of registration and lack of access to venture Association of Southeast Asian Nation peers capital funds hinder fintech development and while issues on mainstreaming sustainable financial innovation in general. Banks have finance remain. Strategy Framework To ensure macroeconomic stability, the and a healthy financial sector can be mutually financial sector must be characterized by reinforcing. If the financial system is stable, greater inclusiveness, beneficial innovation, people will be encouraged to deposit in banks and continuing health. Toward these goals, and use formal financial services. On the financial inclusion must be broadened and other hand, retail deposits provide a stable deepened, financial innovation accelerated funding base during bank runs (as opposed to and strengthened, and the health of the large-value deposits of big-ticket depositors). financial sector ensured. These outcomes are Financial innovations that address access the expected results of the 11 main strategies barriers among traditionally unserved/ proposed in the diagram below. Some strategies underserved markets (e.g., low-income cut across all three expected outcomes. The households, informal workers) can support three outcomes are likewise interconnected. financial inclusion objectives. For instance, an inclusive financial system Figure 11.1.1 Strategy Framework to Promote an Inclusive, Innovative, and Healthy Financial Sector ENSURE MACROECONOMIC STABILITY AND EXPAND INCLUSIVE AND INNOVATIVE FINANCE PROMOTE AN INCLUSIVE, INNOVATIVE, AND HEALTHY FINANCIAL SECTOR FINANCIAL INCLUSION FINANCIAL INNOVATION FINANCIAL SECTOR BROADENED AND DEEPENED ACCELERATED AND STRENGTHENED HEALTH ENSURED Adopt regulatory sandbox approach for fintech Pursue financial stability through macro and micro Promote financial literacy innovators prudential measures Encourage efficiency and innovation in SME Intensify consumer protection Improve access to financial services, including financing, microfinance, and microinsurance digital services, among previously excluded sectors Strengthen the effectiveness of the FSCC Mainstream sustainable finance Develop alternative platforms for financial Support capacity building and digital Enhance supervision and regulation of the literacy programs transformation of microfinance and financial system microinsurance companies Increase ubiquity and affordability of cash Continuously improve the sustainable finance Enhance awareness campaigns on financial agent services definition, its principles-based taxonomy, and frauds, scams, and recourse measures establish a sustainable pipeline database Enhance awareness campaigns on financial products and services Adopt insurtech to develop affordable and responsive financial products Sustain and complete digital transformation Increase investments of retail and institutional players in sustainable finance Leverage data and address information gaps among stakeholders Incentivize SMEs, Corporates, and PPPs to publicly list Promote safe and efficient National Payment System (NPS) Promote enabling regulations for fintech Foster capital market development Promote regtech development Support and adopt open financing Support and adopt the BSP Roadmap for the NPS Develop, enhance, and promote the use of credit database Promote new equity and bond issues for investment Adopt regulatory framework and policies that remain relevant amidst innovation and digitalization Adopt regulatory technology for digital finance innovations Note: Sample sub-strategies for government and private sector (italicized) participation in achieving main strategies were indented. 242 | Philippine Development Plan 2023-2028 The 11 main strategies require cooperation culled from and considered as among the between the private sector and the government. most important measures and strategies The strategy framework also shows listed in various strategy documents, e.g., samples of specific sub-strategies classified FISC NSFI 2022–2028, Inter-Agency Task according to the degree of responsibility for Force for Sustainable Finance Road Map, delivery of either the private sector or the and International Monetary Fund (IMF) government. The sub-strategies were mostly assessment reports. Strategies Outcome 1: Financial inclusion broadened and deepened Financial inclusion is not only about financial institutions (FIs)—both banks and increasing the number and proportion of the non-banks—can enhance the awareness country’s population with access to financial campaigns on financial products and services. products and services. Financial inclusion involves reducing the demographic disparities Improve access to financial services, among those who are able to participate in including digital services, among the formal financial sector and those who are previously excluded sectors unable. It also means that those who are able The government will enable broad-based to participate can access not just payment access to both traditional and digital financial systems but also a broader range of products services by accelerating the implementation of and services. This outcome can be achieved PhilSys and expanding its use in the financial by promoting greater awareness among the sector. In this endeavor, the OF Bank and population of the benefits of participating in interested stakeholders can collaborate with the formal financial sector and by increasing the Philippine Statistics Authority to facilitate the range of products and services they can their onboarding into the system. more easily access. Promoting more savings and investments Promote financial literacy among OFs and their families may be achieved The government will develop alternative through improved digital platforms and platforms for financial literacy programs, remittance services, which the government including for OFs e.g., through the BSP, can in turn help foster through greater support Land Bank and other government financial for innovation and competition in the sector. institutions, and other financial regulators, such Improved financial and digital infrastructure as the Cooperative Development Authority, would not only facilitate cost and credit risk Securities and Exchange Commission (SEC), reduction, but also the wider-scale adoption Insurance Commission, and Philippine of digital financial services. In off-grid areas, Deposit Insurance Corporation. Private the BSP will promote the development of interoperable ‘offline’ digital payment solutions Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 243 that would enable financial transactions management body, such as the Philippine to take place without the need for internet Payments Management, Inc. (PPMI), which connection, consequently boosting financial with increased digitalization, would enable inclusion in these areas. As a rule, all the smaller FIs’ greater efficiency, diversity and digital transformation programs of FIs should flexibility in the services that they can offer. be consistent with the BSP DPTR. Moreover, the government will promote a shared agent network framework primarily Fostering the growth and development of to increase the ubiquity and affordability of smaller FIs involves addressing some of the cash agent services. To provide venture capital disadvantages that they face for being small. funds to private sector fintech companies, The government will develop and implement the National Development Company will be a regulatory framework for the participation revitalized to assist in the growth of fintech of qualified MFIs, non-government companies delivering digital financial services. organizations, and cooperatives in retail payment systems governed by a payment system Outcome 2: Financial innovation accelerated and strengthened Rapid advances in technology and the testing and exit, the BSP will continue to increasing needs of the market – both in maintain a test and learn environment to periods of calm and crisis – have fostered the encourage responsible innovation. The private development and acceptance of a wide array sector, specifically fintech companies who of innovative financial products and services qualify, can participate to test their products in the sector. Innovation can be beneficial and services in the regulatory sandbox. and thus must be quickly made available to BSP-supervised financial institutions (BSFI) consumers. However, it will be prudent to test can take advantage of the “regulatory sandbox innovative products and services before these lite” feature of the framework. are made fully available to consumers. While innovation across a wide range of products Encourage efficiency and innovation and services is helpful, the government has in small and medium enterprise to ensure innovative progress in important financing, microfinance, and developmental markets, products, and services. microinsurance The government will create an enabling Adopt a regulatory sandbox environment and adopt programs to promote approach for fintech innovators financing products responsive to the needs The BSP will encourage fintech companies to of micro, small and medium enterprises capitalize on the regulatory sandbox of the BSP (MSME) and cooperatives which may to ensure that innovation will benefit users not have the necessary documents, credit while complying with regulations. Using its history, or collateral to access the usual four-stage process of application, evaluation, financing sources. Value chain and supply 244 | Philippine Development Plan 2023-2028 chain financing, as well as movable asset The government will support the capacity financing, are lending methodologies that building and digital transformation of can viably expand the financing options of microfinance and microinsurance companies MSMEs and cooperatives for their working and will promote the development of capital and other financing requirements. microinsurance products that cover disaster Well-designed guarantee programs, efficiency risks. The expansion of agriculture insurance enabling electronic platforms, and enabling will be promoted through greater private sector laws, such as for modern warehouse participation. The private sector can adopt receipts systems, are some of the necessary insurance technology (InsurTech) to develop conditions for a vibrant market for movable affordable and responsive financial products. asset financing, including supply chain Markets and mechanisms for risk protection financing and warehouse receipts financing. shall likewise be expanded, including social Additionally, the government will enhance insurance and pension, while the capabilities the implementation of the Credit Surety Fund of Financial Service Providers (FSP) that are through the organization and strengthening mission-driven and strategically positioned to of Credit Surety Fund Cooperatives to assist serve rural and low-income communities shall in credit risk mitigation for MSMEs. also be strengthened. Moreover, enhanced support for MSMEs and Mainstream sustainable finance cooperatives, especially in the regions, can The government will continuously improve be achieved through the provision of credit the mainstreaming of sustainable finance guarantee facilities under the Philippine through the adoption of a principles-based Guarantee Corporation (PHILGUARANTEE), taxonomy, the establishment of a sustainable with the aim of facilitating and promoting pipeline database, and the promotion of trade and investments and regional sustainable financial products. Financial development. PHILGUARANTEE’s MSME institutions will need to institutionalize Credit Guarantee Program will target priority sustainability principles in their management MSME and agriculture segments, including and governance frameworks and will have women-owned and women-led enterprises. to consider, where relevant and applicable, To diversify financing sources, especially strategies, priorities, and guiding principles for MSMEs and cooperatives, the SEC will contained in the Philippines Sustainable encourage crowdfunding by continuously Finance Roadmap and Philippine Sustainable promoting competition in the market through Finance Guiding Principles. Moreover, the the promulgation of rules for registration private sector can support this strategy by (e.g., granting of more permits) and licensing promoting investments in sustainable finance of innovative and other trading markets for to their retail and institutional clients and their innovative securities, securities of small and own asset management groups. medium growth and venture enterprises, and technology-based ventures. Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 245 Outcome 3: Financial sector health ensured The financial sector, especially BSFIs, is a decisions can be strengthened by providing significant component of the economy. It is sectoral regulators10 with a financial stability vital to ensure the health, in terms of stability objective. Efforts of financial regulators and growth, of these financial institutions. to enhance supervision and regulation of The health of the sector is also reflected in the financial system through information the confidence of consumers in the country’s sharing, harmonization of regulations, financial system, which in turn is fostered when and coordinated supervisory measures consumers do not unduly suffer financial asset under bilateral arrangements and of the losses due to inadequate consumer protection. Financial Sector Forum are likewise critical in promoting financial stability. The BSP will Pursue financial stability through also maintain close supervision of banks macro and micro prudential and adopt microprudential measures to measures ensure the protection of customers and A safe and sound financial system serves as an other stakeholders. important foundation for accelerating financial Intensify consumer protection innovation and deepening financial inclusion. To this end, the BSP will continue pursuing The government will intensify financial its mandate to maintain financial stability consumer protection by effectively through the Financial Stability Coordination implementing the Financial Products and Council (FSCC), an inter-agency council Services Consumer Protection Act, including tasked to ensure financial stability through more effective client recourse and stronger macro-prudential measures to manage cybersecurity measures. The continued systemic risk. To enhance the effectiveness of enhancement of the regulatory environment the FSCC, the IMF8 recommends enhancing and capacities will promote greater innovation, the macroprudential strategy framework, competition, and consumer protection across expanding its macroprudential toolkit,9 all FSPs. Meanwhile, private FIs can ramp and introducing macroprudential stress up awareness campaigns on financial frauds, testing. Additionally, the influence of FSCC scams, and recourse measures. Cross-Cutting strategies The following strategies cut across and will financial products and services, and prudent help achieve the three desired outcomes of and beneficial innovation. The development of financial inclusion, innovation, and health. the capital markets, through progressive and The availability and regulated sharing of innovative products and policies, will provide timely, accurate, and reliable information will more investment opportunities to retail allow for more efficient funding decisions, investors, broadening and deepening financial broader and protected consumer access to inclusion and at the same time improving 246 | Philippine Development Plan 2023-2028 the resiliency of the financial sector with a and that all members and applicants for deeper capital market. An efficient and secure membership are treated fairly and consistently. national payment system (NPS) will enable and Moreover, the BSP intends to approach the support the growth of financial transactions. implementation in a tiered manner (e.g., by Finally, the use of technology for reporting, data sensitivity, data type, and data holder type) supervision, and compliance will facilitate to ensure that risk spillovers are mitigated and financial inclusion and innovation and benefits of open finance are optimized. more importantly, ensure a well-functioning financial sector. Promote safe and efficient National Payment System12 Leverage data and address BSFIs will adopt and implement the digital information gaps among stakeholders transformation framework laid out in the BSP The government will promote the use of DPTR. At the same time, the BSP will continue credit databases;11 develop frameworks and to build capacity to ensure that it adopts tools for collecting and sharing the financial regulatory frameworks and policies that data of agriculture-related firms, MSMEs remain dynamic amidst innovations in and and cooperatives for credit evaluation; fully digitalization of the country’s payment system. operationalize the movable collateral registry system; and promote the secure sharing Foster capital market development. of financial data among stakeholders. The Capital market development can enhance passage of the Warehouse Receipts law can domestic financial stability by providing significantly enhance MSMEs’ access to new tools not only to raise funds, but also short-term financing, including value-chain manage risks.13 Fostering capital market financing for exports and agriculture. The development involves encouraging the listing government will establish a credible registry of qualified firms to enable them to raise to increase the participation of both borrowers funds in the equity market. In this endeavor, and lenders, raise liquidity, and allow greater the SEC, together with the Philippine Stock access to financing by MSME borrowers and Exchange, will educate corporates about the more investment outlets for retail investors. easing of listing requirements. Moreover, the government will incentivize small and medium Meanwhile, the private sector can support enterprises and public-private partnerships to and adopt open financing to utilize become publicly-listed firms and will privatize permissioned-access to financial information selected government-owned and controlled needed to develop and offer innovative corporations and consider publicly listing products or services that are responsive to those which can be attractive to retail and customers’ needs. The government, through institutional equity investors. the Open Finance Oversight Committee, shall promote non-discriminatory membership In terms of developing the domestic credit by ensuring that key areas of interest of the market, the government will support the financial industry are adequately represented development of a local credit market and a Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 247 credible and independent local government Promote RegTech development unit (LGU) credit rating system, including BSP will continue to promote the use the conduct of a comprehensive preliminary of regulatory technology (RegTech) by study on the development of an LGU bond supervised entities and adopt supervisory market (See Chapter 11.2). This would provide technology as it digitalizes reportorial the public both a means to participate in local requirements and uses artificial intelligence governance and an alternative channel for their for its supervisory functions. RegTech will savings to fund productive investments. As a help fight cybercrimes and benefit financial source of funds, the government can leverage sector firms and supervising agencies. To OF remittances for strategic development. improve regulatory compliance, the private The private sector and government, working sector can adopt RegTech in pursuing greater jointly in the Capital Markets Development digitalization to improve the design and Council, will continue to implement the delivery of innovative financial products strategies outlined in the current Capital and services. RegTech will be able to provide Markets Development Road Map. Banks can efficient and effective public and private sector encourage their medium and large corporate solutions to prevent fraud, money laundering, clients to strengthen their capital structure and terrorist financing; streamline prudential by raising equity in the stock market; or for reporting; conduct effective creditworthiness corporates to leverage their balance sheets, assessments; and provide a more efficient, raising long-term funding via bond issuances. timely, and accurate manner of meeting Banks can also promote new equity and bond reportorial and compliance requirements, issues for investment through their retail and among others. institutional clients, including small investors who should be able to access these investment products through the banks’ digital services. 248 | Philippine Development Plan 2023-2028 Legislative Agenda Table 11.1.1 presents the priority bills of the 19th Congress to promote an inclusive, innovative, and healthy financial sector. Table 11.1.1 Legislative Agenda to Promote an Inclusive, Innovative, and Healthy Financial Sector PROPOSED BILL RATIONALE/KEY FEATURES RESPONSIBLE AGENCY Bank Deposits Secrecy Bill This bill will strengthen the banking system’s capacity to effectively combat tax evasion, Bangko Sentral ng Pilipinas money laundering, and other financial crimes. (BSP) Internet Transaction Act This act will regulate all Business-to-Business and Business-to-Customer commercial Department of Trade and transactions over the internet, including those related to internet retail, online travel Industry services, digital media providers, ride hailing services, and digital financial services Digital Payments Act This aims to provide ample legal support for all government institutions to adopt digital BSP payments in collections and disbursements, including the provision of the corresponding budgetary requirement and appropriations to support the transformation of payments received and disbursed into digital form; and to grant authority to relevant government institutions to develop an incentive mechanism that would encourage merchants to adopt digital payments in their operations, among others. Capital Markets Development It will expand capital market by developing robust institutional investor base, Securities and Exchange Act strengthening regulatory environment, and promoting financial literacy. Commission (SEC) Financial Accounts It aims to strengthen consumer protection and impose higher penalties for financial BSP Regulation Act cybercrimes. Amendments to the This will overhaul the present warehouse receipt system and provide an online registry SEC Warehouse Receipts Law system where all electronic warehouse receipts can be registered and accessed. Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 249 Results Matrix Table 11.1.2 presents the indicators and targets during the Plan period to promote an inclusive, innovative, and healthy financial sector. Table 11.1.2 Results Matrix: Promote an Inclusive, Innovative, and Healthy Financial Sector BASELINE ANNUAL PLAN TARGETS MEANS OF RESPONSIBLE INDICATOR AGENCY/INTER- (YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION AGENCY BODY Outcome 1: Financial inclusion broadened and deepened Proportion of adults (15 years 55.6 ≥70.0 ≥70.0 ≥75.0 ≥75.0 ≥80.0 ≥90.0 Bangko Sentral BSP and older) with an account (2021) ng Pilipinas at a bank or other financial (BSP) Demand institutions or with a mobile- Side survey money service provider increased (%) Proportion of E income socio- 55.1 ≥60.0 ≥60.0 ≥65.0 ≥65.0 ≥70.0 ≥75 BSP Demand BSP economic class with accounts to (2021) Side Survey proportion of ABC income class with accounts increased (%) Outcome 2: Financial innovation accelerated and strengthened Volume of digital payments over 30.3 50.0 52.0- 54.0- 56.0- 58.0- 60.0- Payment System BSP total retail payment transactions (2021) 54.0 58.0 62.0 66.0 70.0 Oversight in the country increased (%)a Department Dashboard Number of financial technology 216 221 226 231 240 250 260 Fintech Alliance SEC (fintech) companies increased (2021) Outcome 3: Financial sector health ensured Ratio of Financial System’s Total 149.4 129.5 129.5 129.5 129.5 129.5 129.5 Assets to gross domestic product (2021) (at current prices) increased (%) a) Banks and Non-Banksb 135.0 >116.0 >116.0 >116.0 >116.0 >116.0 >116.0 Report on Total BSP, Government Resources of the Service (2021) Philippine Financial Insurance System, National Income Accounts System, Social Security System, etc.c b) Insurance Commission (IC) 11.7d 11.0 11.0 11.0 11.0 11.0 11.0 IC Annual Reports, IC supervised National Income (2021) Accounts c.) Cooperative Development 2.7 2.5 2.5 2.5 2.5 2.5 2.5 CDA Authority (CDA)-supervised (2021) cooperatives (less coop banks and insurance coops) a/ Refers to the percentage of digital payments volume over total retail payments volume where digital payment refers to a payment transaction between two parties where both the payer and payee utilized digital payment instrument/channel in making the transaction. While retail payments refers to payments that meet at least one of the following: (a) the payment is not directly related to a financial market transaction; (b) the settlement is not time-critical; (c) the payer, the payee, or both are individuals or non-financial organization; or (d) either the payer, the payee or both are not direct participants in the payment system that is processing the payment. b/ Non-banks comprised of BSP-supervised Investment Houses, Financing Companies, Investment Companies, Securities Dealers/Brokers, Pawnshops, Lending Investors, Non-Stock Savings and Loan Associations (NSSLA), Credit Card Companies, Government Non-bank Financial Institutions (i.e., Philippine Guarantee Corporation [PHILGUARANTEE] and Small Business Corporation[SBC]), and Authorized Agent Banks (AAB) Forex Corporations, wherein assets are reported gross of allowance for probable losses and net of depreciation. Data on non-banks are based on Consolidated Statement of Condition, except for NSSLAs which is based on Financial Reporting Package. Non-bank institutions also include Social Security System (SSS), Government Service Insurance System (GSIS), and private insurance companies (i.e., life insurance companies, non-life insurance companies, and professional reinsurers), wherein assets are reported net of allowance for probable losses and depreciation. c/ Bangko Sentral ng Pilipinas, GSIS, SSS, and other Government Non-Bank Financial Institutions (e.g., PHILGUARANTEE and SBC). d/ Data sourced from unaudited financial statements submitted by Insurance Commission-regulated entities for Q4 2021. 250 | Philippine Development Plan 2023-2028 Subchapter 11.2 Ensure Sound Fiscal Management and Improve the Tax Regime Significant gains have been made by the government in broadening tax bases and strengthening excise taxation as a regulative tool. The structure and administration of the incentive system have been reformed to harmonize the revenue needs of the country with the promotion of investments. The post-pandemic challenge is to sustain the country’s economic recovery while maintaining fiscal sustainability amid global uncertainties. The country’s socio-economic development needs will continue to be financed through a progressive and simplified tax system and more efficient tax administration through the adoption of digital technology. National government spending will be made more efficient while budget priorities will be aligned with the administration’s socioeconomic agenda. Rightsizing of the bureaucracy will be pursued, consistent with the devolution of services to local governments. At the same time, the government will continue to recognize the important role of the private sector in development. Sources of funding will be diversified through the development of the capital market, including the local government bond market. These policy thrusts are aligned with the Medium-Term Fiscal Framework of the incumbent administration. With the efficient mobilization and utilization of resources, the national government will focus on achieving fiscal sustainability by bringing down the deficit-to-gross domestic product (GDP) ratio to 3 percent by 2028 and the national government debt-to-GDP ratio to less than 60 percent by 2025. Assessment and Challenges The global health crisis triggered a sharp 2020 to 9.2 percent in 2021, although this is decline in economic activities, which negatively lower than the 9.5 percent in 2019. affected tax collections. Revenue-to-GDP ratio declined to 15.5 percent in 2021 from Large and persistent budget deficits threaten 16.1 percent in 2019. Tax effort also slid macroeconomic stability, as these not only to 14.1 percent in 2021 from 14.5 percent result in a debt overhang, but also in high in 2019. On the expenditure side, primary interest rates and even inflationary problems expenditure-to-GDP substantially increased that result from debt monetization. Moreover, to 21.9 percent in 2021 from 17.6 percent in inadequate revenues constrict the ability of 2019 due to increased spending on pandemic the government to provide adequate goods response and recovery measures. The budget and services to the public, particularly in deficit widened to 8.6 percent of GDP in 2021 terms of allocating resources for physical from 3.4 percent in 2019. Consequently, the (infrastructure) and human capital (health debt-to-GDP ratio increased from 39.6 percent and education) development, which have in 2019 to 60.4 percent in 2021. There was also long-term growth implications. a slight uptick in the share of interest payments to total disbursements from 9.0 percent in Meanwhile, bureaucratic inefficiencies and limited absorptive capacity of national Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 251 government agencies impede the timely Moreover, the recovery process is implementation of measures to effect economic challenged by global economic slowdown, transformation, including the flagship tightening of global financial conditions, infrastructure projects. Varying capacities of the higher-than-expected inflation, worsening local government units (LGU) to absorb larger climate change issues, and the threat of a fiscal transfers in light of the implementation resurgence of new virus strains. The downside of the Supreme Court (SC) ruling on the external and domestic risks put pressure on Mandanas-Garcia Case may affect the delivery the government’s fiscal consolidation strategy of devolved functions. A smooth transition to and hamper planned public investments in the full devolution, therefore, requires an extensive medium term. capacity development program and assistance for LGUs with limited local resources. Strategy Framework Sound fiscal management and an improved a) Efficient revenue collection and tax regime will help ensure a stable high compliance due to simple and macroeconomic environment. Adequate automated processes; revenues will be raised to finance economic b) Broader revenue bases, lower tax rates, and development and provide better education, fewer tax exemptions; health, and social services. To sustain sound c) An appropriate tax regime for industries fiscal management, the following outcomes generating negative externalities or those will be pursued: (a) productive, equitable, and causing damages to society; simple tax system; (b) efficient and inclusive budget system; (c) stronger local government d) Vibrant and efficient public-private finance; and (d) sustainable management of partnerships (PPP); debt (see Figure 11.2.1). e) A firm belief of taxpayers that taxes are By 2028, the following transformation of the well-spent; and fiscal sector will be achieved: f) Strong local governments that raise more than 30 percent of their total revenues from local sources. Figure 11.2.1 Strategy Framework to Ensure Sound Fiscal Management and Improve the Tax Regime ENSURE MACROECONOMIC STABILITY AND EXPAND INCLUSIVE AND INNOVATIVE FINANCE ENSURE SOUND FISCAL MANAGEMENT AND IMPROVE THE TAX REGIME A PRODUCTIVE, EQUITABLE, AND SIMPLE AN EFFICIENT AND LOCAL GOVERNMENT SUSTAINABLE TAX SYSTEM ESTABLISHED AND OTHER INCLUSIVE BUDGET FINANCE MANAGEMENT OF SOURCES OF REVENUES MOBILIZED SYSTEM IMPLEMENTED STRENGTHENED DEBT ENSURED Strengthen the progressivity and productivity of the tax Increase participation of the Strengthen the capacity of LGUs Diversify and explore system private sector in the procurement to raise more revenues and alternative sources of Simplify taxation of the financial sector of government projects implement devolved functions financing Pursue greater use of benefit taxation Ensure timely completion of Pursue an equitable and efficient Maintain a resilient and Implement appropriate tax regime for extractive awards and projects National Tax Allotment strategic debt management industries and pollution Improve the efficiency of Develop the LGU bond market Increase tax compliance to tax laws and regulations by bureaucracy and establish an LGU credit simplifying tax rules and enhancing services of the BIR rating system Pursue the Military and and BOC to taxpayers and other stakeholders Uniformed Personnel (MUP) Streamline and fully automate major processes in tax and pension reform customs administration Fast-track the privatization of government assets 252 | Philippine Development Plan 2023-2028 Strategies Outcome 1: A productive, equitable, and simple tax system established and other sources of revenues mobilized Strengthen the progressivity and and collect a VAT from their sales. Fulfillment productivity of the tax system houses or third-party warehouses responsible for handling goods on behalf of foreign Continuously broaden the income and suppliers will also be required to keep records. value-added (VAT) tax bases through The BIR and Bureau of Customs (BOC) will stronger taxation of the self-employed. complement each other’s efforts in monitoring Without a withholding system, there is no cross-border transactions. assurance that the self-employed will pay a tax on their income. Also, VAT may not The imposition of VAT on digital service be collected by their employers, especially providers for non-resident corporations has among non-resident corporations without a already been approved by Congress. Its efficient permanent establishment in the Philippines. implementation will be clearly planned and Accordingly, a broader tax base and more laid out so that the estimated PHP9.6 billion equitable tax system will be achieved through gains from the measure can be realized. a thorough tax mapping, which will require the alignment of government information In addition, a study will be conducted to technology (IT) and data infrastructure to assess the country’s possible membership in support the sharing of information relevant the Inclusive Framework (IF) on Base Erosion to tax enforcement. All individuals registered and Profit Shifting. An IF membership will with government corporations, such as enable the government to collaborate with Philippine Health Insurance Corporation other member states on the implementation (PhilHealth) and Social Security System (SSS), of domestic and international measures can be part of the Bureau of Internal Revenue to address tax avoidance and safeguard (BIR) database. the tax base. Align tax laws and regulations with the Continuously review exemptions and New Economy. Taxing digital transactions preferential treatment provided by tax laws. involves determining the jurisdiction where Different forms of income, such as dividends, the tax should be paid or the “situs” of the royalties, capital gains from stock transactions, tax. Tax rules will be reviewed to broaden and interest income, are subject to different the concept of “permanent establishment,” tax rates. Neutral taxation of all capital income evaluate the formula for profit allocation, and can minimize avoidance and progressively require digital platforms for firms, including strengthen revenue mobilization. non-resident firms doing business in the Philippines, to register with tax authorities Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 253 The zero-rating of goods and the remaining Acceleration and Inclusion Law to simplify exemptions in the Tax Code will be reviewed the taxation of financial transactions. A to limit exemptions to raw food, agriculture, proposed single rate of 15 percent will be education, and health. This is important as imposed on interest income, dividends, and exemption results in cascading taxation. Sellers capital gains. Uniformity in the taxation of of exempt products are unable to deduct the banks, quasi-banks, and certain non-bank VAT they paid on inputs. By breaking the financial intermediaries will be achieved with a audit trail, VAT exemptions undermine the 5 percent gross receipts tax. Rate differentiation self-enforcing nature of the VAT. based on the maturity of financial instruments will be removed. The taxation of insurance Broaden the coverage of goods subject to services, such as pre-need, pension, life, and the excise tax on non-essential articles. The health maintenance organization insurance, Tax Code identifies a very limited number will be made uniform at 2 percent of the of goods as non-essentials. These include premium. The tax on Initial Public Offering jewelry, perfume, yachts, and other vessels and the Documentary Stamp Tax on specific intended for sports. These non-essential transactions will be removed to support capital items are subject to a 20 percent tax on their market development. wholesale price or value of importation. The inclusion of all non-essential articles in the tax Pursue greater use of benefit coverage would improve the progressivity of taxation the indirect tax system, considering that VAT User charges are levied on consumers of is imposed at a uniform rate. The success of government goods and services in relation this measure will depend on the formulation to their consumption. They are not primarily of effective criteria to determine non-essential intended to raise revenues but to promote commodities. To this end, estimates of the economic efficiency, since underpricing, free, price elasticities of the demand for goods can or subsidized provision of goods and services provide helpful information. results in over-consumption. Strengthen the potential of the excise tax to The amount of user charges will then be achieve policy goals. The inclusion of other reviewed to ensure that citizens properly value motor vehicles, such as motorcycles and the services the government provides, and that pick-up trucks, under the excise tax regime the government can at least recover production will be considered. The progressivity of the and delivery costs. A subsidy component for excise tax rates on motor vehicles will also be the poor will be part of the program to address reviewed, especially on high-priced vehicles. equity concerns. Moreover, an incentive Simplify taxation of the financial system for government agencies that collect sector the fees will be devised. The Passive Income and Financial Intermediary Taxation bill complements the reforms introduced by the Tax Reform for 254 | Philippine Development Plan 2023-2028 Implement appropriate tax regime monitoring of the effects of the operations of for extractive industries and extractive industries on the environment and pollution public health. A special fiscal regime will be designed to ensure Increase tax compliance to tax laws that the state, as a resource owner, receives and regulations by simplifying tax an appropriate share of the economic rent rules and enhancing services of the enjoyed by extractive industries, particularly BIR and BOC to taxpayers and other mining. Since they create negative externalities stakeholders that impose risks on communities’ health Voluntary compliance in filing tax returns and and safety, the efficient taxation of extractive paying taxes will be facilitated by simplifying industries requires a delicate balance between rules and processes. Moreover, contactless developing natural resources on one hand and processes and procedures will be promoted safeguarding well-being and patrimony on the by digitalizing all transactions with tax and other hand. customs offices. The government will also strengthen The BIR will ramp up its efforts to simplify the monitoring and governance of the registration, invoicing, and accounting extractive sector by enhancing civic space, requirements. It will enhance the portability people participation, and institutionalizing of tax transactions by removing venue Extractive Industries Transparency Initiative restrictions in the filing and payment of taxes. (EITI) principles at the national and Allowing taxpayers to file and pay their taxes sub-national levels. anywhere will ease compliance. Another potential fiscal measure is a carbon The BOC will intensify its work in facilitating tax that can encourage a shift to less-polluting trade using the National Single Window on fuel and reduce carbon dioxide emissions. automated and integrated licensing, permit, The government can set a price for each ton clearance, and certification systems. The of greenhouse gas (GHG) emissions, such as BOC’s implementation of the National Action carbon dioxide or methane. GHG emissions Plan on Paperless Trade Agreement will can be estimated based on the consumption complement this program. of fossil fuels. There are estimates of “carbon footprints,” or how much carbon dioxide is The government can include in the educational released per unit of oil or gas consumption. curriculum programs that will enable better The tax can piggyback on existing fuel public appreciation of how taxes are spent, taxes and taxes paid by mining and thus encouraging positive tax compliance gas drilling companies. behavior. At the same time, revenue-collecting agencies will meet taxpayers’ expectations An appropriate fiscal regime for drilling natural through the provision of honest, helpful, and gas and oil will be designed to compensate efficient services. the state for the depletion of a finite resource. The government will also intensify the Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 255 Streamline and fully automate Program will be fast-tracked to major processes in tax and customs automate compliance checks and audit administration selection processes. The BOC has gone a long way in digitalizing Fast-track the privatization of its processes, with 91.2 percent or 155 of government assets 170 customs processes already automated. The remaining 15 processes, which include The privatization program will be continuously a public auction, issuance of a certificate of pursued to broaden ownership base and shipment, and certification of re-exportation foster greater private sector participation. commitment, will also be digitalized. The Privatization and Management Office has initiated the verification and disposition of The BIR will focus on improving a digital about 27,000 assets that are still in the Asset infrastructure for seamless electronic Registry, including the claims of mining data transmission. In this connection, the corporations and of the National Government implementation of a Digital Transformation Mining Assets. Outcome 2: An efficient and inclusive budget system implemented Increase participation of the private Ensure timely completion of awards sector in the procurement of and projects government projects The full implementation of the Modernized The expertise and efficiency of the private Philippine Government Procurement System, sector will increasingly be harnessed through automation of procurement-related reports, PPP projects. Partnerships will encourage the and simplification of bidding documents private sector to co-own the responsibilities will help streamline procurement processes of fostering development. PPPs will ensure and improve budget utilization. A Budget that infrastructure development and service Modernization Bill has also been introduced delivery will have a sustainable funding source. in Congress, seeking to institutionalize reforms in the Cash Budgeting System The Congress is currently deliberating on and Public Financial Management (PFM). a bill that aims to develop PPP projects PFM reforms will institute fiscal discipline that are well-structured and are consistent to ensure that budget proposals from line with development goals and the climate agencies will undergo extensive preparation, change agenda. Further, the revision of the and will be implemented on time. The IRR implementing rules and regulations (IRR) of of the Government Procurement Reform Act the Build-Operate-Transfer Law will reflect will likewise be further reviewed to address best investment policies and practices. procurement delays. 256 | Philippine Development Plan 2023-2028 Improve the efficiency of and specific strategies to improve bureaucratic bureaucracy efficiency can be found in Chapter 14. The government will embark on a National Pursue the Military and Uniformed Government Rightsizing Program (NGRP) Personnel pension reform that will result in a more agile, efficient, and technology-adept workforce. The NRGP will Actuarial studies estimate that the current Military result in greater bureaucratic efficiency of and Uniformed Personnel (MUP) pension government, and the corresponding efficiency system requires PHP9.6 trillion. As such, reforms gains will constitute additional resources to in the MUP pension system will be instituted to finance more spending on infrastructure and make the system financially sustainable. These social services. Simplified systems will enhance include a mandatory contribution scheme and productivity, minimize red tape, and promote increase in the compulsory retirement age, a higher level of citizen satisfaction with the among others, to curb the ballooning pension performance of the government. More detailed costs and ensure fiscal sustainability. Outcome 3: Local government finance strengthened Strengthen the capacity of LGUs to will ensure that the increased resources of raise more revenues and implement LGUs will result in the implementation of devolved functions Devolution Transition Plans and the efficient delivery of public services. Interventions to The government will support the capacity of improve the capacity of LGUs in the delivery local governments in resource generation. of the devolved services will also be provided A Real Property Valuation and Assessment by national government agencies, to be led by Reform Bill has been proposed to strengthen the Department of Budget and Management tax collection through the regular valuation and the Department of the Interior and Local of real properties using improved valuation Government (See Chapter 14). standards. The local tax structure, which was formulated in 1991, will be revisited to make Pursue an equitable and efficient it simpler, more efficient, and responsive to the National Tax Allotment current economic environment. Many LGUs have been recognized for their innovative The potential of the National Tax Allotment practices in fiscal management. These practices (NTA) to lessen regional disparities will be will be replicated and scaled up through peer explored. Currently, 25 percent of the NTA is mentoring, to be spearheaded by the Bureau equally distributed among LGUs, regardless of of Local Government Finance, in partnership income. The poor and wealthy LGUs receive with the Philippine Tax Academy-Local equal NTA shares. As such, the current NTA Government Finance Institute. formula falls short in incentivizing LGUs to utilize their taxing powers fully. A step forward In line with the implementation of the SC ruling involves basing the NTA shares of LGUs on on the Mandanas-Garcia Case, the government their financial capability and revenue effort, Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 257 both to enhance equity considerations in the conduct a comprehensive preliminary study on NTA and encourage LGUs to intensify their the development of the LGU bond market to revenue-raising efforts. assure the confidence of possible bondholders. Develop the LGU bond market The national government will also and establish an LGU credit rating support the development of a local credit system market and an LGU credit rating system (See Subchapter 11.1). Such a credit market Bond financing can provide LGUs with system would allow the public to participate access to direct funding sources, and in the in local governance and invest their savings in process, require them to practice discipline worthwhile local programs. in transparency, accounting, and auditing finances. The national government will thus Outcome 4: Sustainable management of debt ensured Diversify and explore alternative the Philippine peso, and in so doing, mitigate the sources of financing incurrence of currency mismatches attendant with the alternative case of international debt Corporate, institutional, and individual floats. savings can be mobilized to finance government programs through the deepening The government will continue to maximize and broadening of the domestic capital market, available Official Development Assistance supplemented with financial literacy programs due to its favorable borrowing terms up until and the promotion of digital finance technology the country reaches upper-middle-income (See Subchapter 11.1) to spread awareness of status. The government will also maintain its and improve access to government securities presence in the international bonds market as alternative investment vehicles. to provide flexibility in its financing options and to facilitate efficient bond pricing for local The government will explore creative and borrowers with foreign currency requirements. innovative borrowing structures to spur Moreover, borrowing in the international participation in the government securities bonds market will be diversified across market, especially of non-traditional Filipino various markets and in different instrument investors such as small savers domiciled in formats to attenuate supply-related escalation the Philippines and abroad, to broaden the in borrowing costs. New instrument formats government’s investor base. will also be explored to reach new markets A more competitive tax regime on interest and investors. income that is harmonized with regional peers will also encourage foreign participation in the domestic bond market. This would enable the government to raise more foreign investments in 258 | Philippine Development Plan 2023-2028 Maintain a resilient and strategic program will provide a comprehensive debt management accounting of contingent liabilities and sufficient support for the development of the Debt management strategies will continue domestic debt market. to ensure that the financing needs of the government and its payment obligations will To ensure that the interest burden of debt be met at the lowest possible costs consistent remains manageable, the government will with acceptable level of risks. The composition maintain, if not improve, its high credit rating of public debt and external vulnerabilities will by adhering to fiscal discipline and prudent be considered in developing an optimal debt debt management. portfolio with a strategic mix of external and domestic debt. A resilient debt management Legislative Agenda Table 11.2.1 presents the priority bills of the 19th Congress to ensure sound fiscal management and improve tax regime. Table 11.2.1 Legislative Agenda to Ensure Sound Fiscal Management and Improve the Tax Regime RESPONSIBLE LEGISLATIVE AGENDA RATIONALE AGENCY Tax Policy and Digital Taxation Framework to ensure a level playing field between traditional industries and the digital Department Administration Agenda economy given the expected shift to online transactions. of Finance (DOF), Bureau Passive Income and Financial Intermediary Taxation has provisions to simplify the taxation of financial of Internal transactions by proposing to reduce the number of tax rates per se and the number of differential Revenue, tax rates. Bureau of Customs Other tax administration measures that will improve the ease of paying taxes and authorize the automatic exchange of information for tax purposes. Rationalization of the fiscal Seeks to broaden the tax base by developing an appropriate fiscal regime for (a) both extractive and DOF regime for extractive polluting industries to internalize the negative externalities they generate, protect patrimony and well- industries and pollution being, support green recovery, and strengthen monitoring and governance of the extractive sector and developing an through the institutionalization of Extractive Industries Transparency Initiative; and (b) unhealthy foods appropriate tax structure to discourage its consumption and encourage healthy alternatives. for unhealthy foods Budget Reform Policy Budget Modernization Bill: Seeks to institutionalize an efficient Cash Budgeting System and other key DBM Public Financial Management reforms. Military and Uniformed Develop a sustainable pension system for MUPs by creating an MUP pension fund with mandatory DBM, Bureau of Personnel (MUP) Pension contributions, adjustment of the indexation process, and identification of funding sources for the Treasury Reform bill pension system. Local Government Finance Real Property Valuation and Assessment Reform Bill to rationalize and support the regular valuation DOF, Bureau of real properties, in accordance with internationally-accepted valuation standards. of Local Government Amendment of the National Tax Allotment (NTA) formula: Intends to address equity issues, and vertical Finance BLGF, and horizontal fiscal imbalances between local government units (LGU). The measure seeks for the Department amended NTA Formula to be based on economic, social impact, and equity considerations. of Budget Management LGU Income Classification Bill: Seeks to authorize the Secretary of Finance to set the income ranges and undertake the regular income reclassification of all provinces, cities, and municipalities once every three fiscal years. LGU Property Insurance: Proposes to mandate all provinces, cities, and municipalities to insure all government properties with the Government Insurance Fund. The measure will protect LGUs’ fiscal position against significant losses due to property damages. Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 259 Results Matrix Table 11.2.2 presents the indicators and targets during the Plan period to ensure sound fiscal management and improve tax regime. The efficient implementation of the proposed reforms will help ensure macroeconomic stability. The government’s tax revenues will increase to 17.1 percent of GDP by 2028. The outstanding debt stock will settle below 60 percent by 2025. Corollarily, the utilization of the current year’s budget will be maintained above 90 percent over the medium-term. Local governments will emerge stronger with the growth rates of their respective local revenues matching, if not outpacing, GDP growth. Table 11.2.2 Results Matrix: Ensure Sound Fiscal Management and Improve the Tax Regime TARGETS RESPONSIBLE BASELINE MEANS OF INDICATOR AGENCY/INTER- (YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION AGENCY BODY Sound Fiscal Management Ensured and Tax Regime Improved Outcome 1: A productive, equitable, and simple tax system established and other sources of revenues mobilized Tax revenue-to-gross 15.3 14.6 14.9 15.4 15.9 16.4 17.1 Bureau of Treasury (BTr) Department of domestic product (GDP) (Q1-Q3 Cash Operations Report Finance ratio improved (%)a 2022) and Philippine Statistics Authority (PSA) National Income Accounts (NIA) Outcome 2: An efficient and inclusive budget system implemented Utilization of current year’s 52.9 >90 >90 >90 >90 >90 >90 Department of Budget DBM budget maintained above 90 (S1 2022) Management Statement percent (%) of Appropriations, Allotments, Obligations, Disbursements and Balances Report Outcome 3: Local government finance strengthened Ratio of locally-sourced 31.8 >30 >30 >30 >30 >30 >30 Bureau of Local BLGF local government unit (S1 2022) Government Finance income to total current (BLGF) Statement operating income of Receipts and maintained above 30 Expenditures percent (%) Year-on-Year growth in 28.8 10 10 10 10 10 10 BLGF Statement of BLGF social and economic service (S1 2022) Receipts and Expenditures expenditures maintained at 10 percent (%) Outcome 4: Sustainable management of debt ensured Outstanding national 63.7 60-62 57-61 56-59 54-58 50-55 48-53 BTr and PSA NIA BTr government debt stock to (as of Sep GDP ratio reduced (%) 2022) a/ Targets are based on the July 8, 2022 Development Budget Coordination Committee-approved Medium-term Fiscal Program and the Concurrent Resolution No. 04 approved by Congress on September 19, 2022. 260 | Philippine Development Plan 2023-2028 1 Based on the International Institute for Management Development report, the Philippines’ central bank policy ranked 18th out of 63 countries. 2 Bangko Sentral ng Pilipinas. 2017. Circular No. 980: Adoption of National Retail Payment System (NRpS) Framework. 06 November. https://rbap.org/bsp-circular- 980-adoption-of-national-retail-payment-system-nrps-framework/. 3 PESONet is a batch electronic fund transfer (EFT) credit payment scheme designed to be a more convenient alternative to checks and available to accountholders of BSP-supervised financial institutions participating in this automated clearing house. Payment instruction initiated by the accountholder is processed in bulk and cleared at batch intervals. Each payee will then receive the full value in their account within the same banking day, provided the payment instruction was sent within the cut-off time. 4 InstaPay is a real-time low-value EFT credit push payment scheme. It is designed to be a preferred alternative to cash and would facilitate small value payments that will be particularly useful for the purchase of retail goods and services, as well as for e-commerce. 5 For a report on the digital economy, see Philippine Statistics Authority. 2022. Country’s Digital Transactions Reached PhP 1.87 Trillion in 2021, with 9.6 Percent Contribution to the Gross Domestic Product. https://psa.gov.ph/digital-economy. 6 Office of the President. 2022. Institutionalizing Whole-of-Government Support for the National Strategy for Financial Inclusion 2022–2028. Circular No. 97, series of 2022. City of Manila. 7 Microfinance Council of the Philippines, Inc. 2016. Social Performance Country Report. https://microfinancecouncil.org/wp-content/uploads/2017/04/2016- Philippines-Social-Performance-Country-Report.pdf. 8 International Monetary Fund. 2022. Philippines: Financial Sector Assessment Program—Technical Note on Macroprudential Policy Framework and Tools. https:// www.imf.org/en/Publications/CR/Issues/2022/06/02/Philippines-Financial-Sector-Assessment-Program-Technical-Note-on-Macroprudential-Policy-518572. 9 Examples are the potential use of loan-to-value (LTV) and debt-to-income ratios, liquidity, and foreign exchange position as macroprudential tools. 10 Insurance Commission, Securities and Exchange Commission, and Philippine Deposit Insurance Corporation, 11 E.g., Credit Information System of Credit Information Corporation. 12 The National Payment Systems refer to all payment systems and components including instruments, services, processes, schemes, procedures, infrastructures, and participants that ensure the circulation of money or movement of funds in the Philippines. 13 Carlos Cantú & Michael Chui, 2020. “Financial market development and financial stability,” BIS Papers chapters, in: Bank for International Settlements (ed.), Financial market development, monetary policy and financial stability in emerging market economies, volume 113, pages 19-38, Bank for International Settlements. https://ideas.repec.org/h/bis/bisbpc/113-02.html Chapter 11 Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance | 261 12 Expand and Upgrade Infrastructure CHAPTER 12 Expand and Upgrade Infrastructure Enabling economic transformation builds on sustainable, resilient, integrated, and modern infrastructure systems as a solid foundation. Anchored on the long-term vision, the government will steer the nation toward a future where movement of people and goods is safely and efficiently facilitated by adequate and accessible transportation. Filipinos are empowered through cost-effective and reliable flow and exchange of information and are able to partake opportunities in the digital economy. Families have access to safe and adequate water and sanitation services; to reliable, clean, and affordable fuel and electricity; and to quality education, health, solid waste management and other social infrastructure facilities. Communities and industries are served by green infrastructures that are not only adaptive and resilient against shocks and natural disturbances, but also contribute toward a low-carbon future. Assessment Annual public infrastructure spending in facilities and services remain inadequate 2017–2021 during the administration of in terms of accessibility, quality, safety, former President Rodrigo Roa Duterteranged and affordability. Moreover, the country’s from 4.2 percent to 5.8 percent of gross domestic continuing vulnerability to climate change product (GDP), which is nearly double the already threatens infrastructure provision average annual spending over the previous and operation and thereby undermine decades. Overall, however, infrastructure significant infrastructure investments. Connectivity Mobility of majority of Filipinos is hampered New mass transit railways were also approved by inadequate transportation facilities. in the last six years, with the two largest now There is a shortage in public transport supply. under construction. While a drop of 68 percent This is evidenced by long queues of commuters in total rail ridership was recorded from 2019 and passengers who spend long hours waiting (327.68 million) to 2021 (103.79 million),2 for their rides, and, when they get one, stand ridership increased by at least 23.45 percent inside buses or trains overcrowded with from January (9.14 million) to May 2022 other commuters. (11.94 million).3 Should this trend continue and as the economy opens up after the coronavirus The Philippine rail system’s capacity disease (COVID-19) pandemic, the existing rail is inadequate to meet the ridership network will not be able to accommodate the post-pandemic. The country has four increasing demand, which rose as high as 29.4 operational rail lines with a total length of million monthly ridership in 2019 to the 2022 76.9 km.1 Meanwhile, the number of train cars total capacity of about 31.8 million per month.4 increased to 978 in 2022 from 224 in 2016. Chapter 12 Expand and Upgrade Infrastructure | 265 Transport facilities deemed inaccessible and Board Service Contracting Program (SCP) unsafe, especially for vulnerable groups. Phase III, versus the target of 93,000,000. According to the National Council on Disability While the SCP has provided a means for public Affairsin in 1982, the physical design of the transport operators and drivers to sustain their rail infrastructure falls below the standards set operations as more economic sectors open in the 1982 Accessibility Law,5 and thus makes post-pandemic, the program does not cover them difficult to access and use by pregnant the whole country and cannot be sustained women, parents with very young children, given the tight fiscal space. older people, and persons with disabilities (PWD). Stations with non-functional Use of active transportation is still not elevators and escalators, defective restrooms, popular. The Department of Health (DOH) missing signages, poor security measures such has issued guidelines promoting the safe use as lack of security cameras, overcrowding, of active transport, while the Department of and insufficient lighting in passenger set Public Works and Highways (DPWH) has down further aggravate the risks of accidents, issued an order prescribing the standards on crime, and violence faced by commuters, the design of bicycle facilities along national especially females. Gender-based violence, roads.7 To fund the building and maintenance sexual exploitation, abuse, and harassment of bike lanes and other active transport and discrimination are common and possibly facilities, the government allocated total of under-reported in public spaces including the PHP 3 billion from 2020 to 2022. While there transport sector.6 are four households that own bicycles to each household that own a car,8 only 29 percent of Shortage of road-based public transportation households use their bicycles to go around persists in many urban areas. Since 2003, public transport services franchising has been Road traffic fatalities are increasing in the under a moratorium. This has not helped Philippines. Road traffic accidents exact a reduce the shortage of public transport in heavy toll. Approximately 12,000 Filipinos many cities. Besides being obsolete, most of die on the road each year, while the resulting the public transport fleet in 2022 also do not injuries cost about 2.6 percent of the country’s comply with modern design and emission GDP in 2018.9 The government does not have standards. Meanwhile, the rollout of the a yearly budget allocation for road safety. Public Utility Vehicle Modernization Program While progress has been made in maritime launched in 2017 has progressed slowly since transportation, issues on infrastructure many vehicle owners found the financial terms quality remain. Improvements were pursued of the program unattractive and the funding with the opening of the Matnog, Sorsogon support from the government in the form of to Bogo City, Cebu roll-on/roll-off (RORO) subsidy for vehicle procurement was limited. route, and the issuance of the revised rules As of September 14, 2022, a total of 174,164,758 in the grant of missionary route status for riders have benefitted from the Land RORO passenger ships, and the development Transportation Franchising and Regulatory of the Maritime Route Rationalization and 266 | Philippine Development Plan 2023-2028 Information System.10 Nonetheless, only in prolonged or repeated closure of roads and a limited number of RORO vessels can be higher construction costs. accommodated under the size of the country’s RORO ports in 2022. RORO vessels that serve There are no operational cargo and/or medium-sized ports are smaller compared to freight rail services in the country. The RORO ships that use the Port of Manila. The movement of goods over land is limited to fleet of inter-island ferries is also aging, posing road-based transportation options; rail-based safety risks to commuters. transportation options are non-existent. As such, long-, medium-, and short-distance Little progress has been made to improve shipping by land is done by trucks, which adds airport infrastructure. The country has a total to road traffic congestion and to logistics cost. of 90 airports in operation—comprising 11 The roads leading to ports and airports often international, 41 domestic, 38 community— experience congestion and deteriorate faster and 3 airports not in operation in 2022. due to heavy truck loads. However, not all the country’s international airports and principal Class 1 and principal Port and ancillary facilities are insufficient Class 2 airports comply with modern safety and underdeveloped. As of December 2021, design thresholds, particularly the minimum about 336.56 million metric tons (MMT) of runway strip threshold width and night cargo was transported through the country’s landing capabilities. Proposed improvements port system compared to 133.74 MMT through to major gateways in the country were put airports. Meanwhile, 99.98 percent of the total on hold and are being re-assessed to consider domestic trade in 2021 was transported by sea, new projections in aviation demand. Travel and the rest (0.02%) via air.11 limitations, lockdowns, and hampered Despite the maritime sector’s critical role in business operations due to the COVID-19 the transport of goods, most of the country’s pandemic caused the decline in passenger ports are operated inefficiently due to their traffic by 33.47 percent from 2020 to 2021. inadequate equipment and ancillary facilities. Over the same period, air traffic movement Such inefficiency is evident in the long queues likewise decreased by 54.70 percent. of cargo trucks at port areas. Cargo trucks sometimes wait for days before they are able Civil works and utilities installation along to board a RORO vessel. Such delays result roads are not coordinated. Road widening in poor reliability in the delivery cargoes and activities are not in sync with the relocation spoilage of perishable goods, further straining of electrical and communication poles, as well the food supply chain, among others. as pipe laying and other waterworks, causing traffic jams, road accidents, and other roadside Government-operated ports, especially friction. Prevalence of overhead electrical and those of local government units (LGUs), telecommunications cables and poles along have insufficient cargo-handling equipment. major thoroughfares poses hazards to road Existing LGU-operated ports have limited users. Meanwhile, the lack of coordination financial resources to procure the necessary between road works and waterworks results equipment and support infrastructure such Chapter 12 Expand and Upgrade Infrastructure | 267 as cold chain facilities leading to increased (Mbps) in September 202213 (from 4.3 logistics costs. Mbps in 2016). In this aspect, however, the Philippines consistently lags behind Automated logistics processes are not yet Singapore, Thailand, Malaysia, and Vietnam. integrated. To upgrade the country’s logistics Moreover, the domestic prices of fixed and network, Unified Logistics Pass (ULP) mobile broadband prices14 remained high, at was launched in 2022 that features a quick 11.56 percent and 2.04 percent of monthly response (QR) code issued to cargo trucks. gross national income per capita, respectively. This ensures unhampered movement of goods Both rates are above the global affordability and eliminates the various permits, licenses, threshold target (of below 2%). As evidence and pass-through stickers being required by of the persistent digital divide, only about 18 economic zones, ports, and local government percent of Filipino households have internet units. In addition, a single Transport connections,15 far below the average household Accreditation Permit and Pass for Ports penetration rate of 53.40 percent in the Asia- (TAPPP) is being implemented in all ports Pacific region in 2019.16 under the jurisdiction of the Philippine Ports Authority. While these initiatives have already Climate change is not systematically been introduced and implemented, their integrated in planning, design, operation, application is not yet integrated well in port and maintenance. Climate change does not operations across the country. Thus, trucks adversely affect connectivity alone, but also operating in both PPA and non-PPA ports, places a strain on the country’s economy. The such as those in the economic zones, need to resulting economic losses could be massive and have the two systems installed. This translates would require significant additional financing into additional overhead cost that could have to rehabilitate the damaged infrastructures. been avoided in an integrated system. Due to Typhoon Odette in 2021, 36 percent of seaports were rendered inoperational, Movement of information through digital creating logistics challenges and disruptions infrastructure steadily improved, but still in supply chains, especially for isolated islands. not enough. Driven by increasing demand In addition, some municipalities had limited of Filipinos to stay informed and connected, access to communication services for six recent years saw steady improvement in the weeks, which further hampered disaster relief quality of internet services with broadband and recovery operations. speed,12 reaching 78.69 megabits per second Water Resources The country has limited water resources. The groundwater. Based on the water permits annual freshwater potential of the Philippines issued by the National Water Resources is estimated to be about 146.0 billion cubic Board (NWRB) about 86 billion m3 (or 58% meters (m3), of which roughly 125.8 billion of the total freshwater available) is allocated m3 is surface water and 20.2 billion m3 is annually for various uses, whereby about 7.6 268 | Philippine Development Plan 2023-2028 billion m3 (5.6 billion m3 from surface water Irrigation service provision remains and 2.0 billion m3 from groundwater sources) inefficient and wasteful. National irrigation is used for domestic and municipal water use. systems (NIS) use about 68 billion m3 of water annually (about 80 percent of the country’s Universal access to safe, affordable, and annual available freshwater) to irrigate around sustainable water supply and sanitation 1.9 million hectares (ha) of farms (mostly services has yet to be achieved. Based on planted with rice). In comparison, only around the 2020 Annual Poverty Indicators Survey 52 billion m3 annually on average is used in (APIS) of the Philippine Statistics Authority, other countries to irrigate the same area and the main sources of water supply for Filipino crop type (for two cropping seasons per year). families were water piped into their dwelling This suggests that about 25 percent of the (54.1%), sourced from protected wells water delivered by the NIS is wasted that can (21.5%), communal sources such as public be otherwise saved with proper management. taps, and developed springs (16.0%). Less than 10 percent of them rely on “unsafe sources” such The country is highly vulnerable to as unprotected wells, undeveloped springs, water-related hazards. In a typical year, the rivers, ponds, lakes or rainwater, or bought Philippines experiences about 20 typhoons, from tanker trucks and/or water peddlers. of which eight make landfall and often hit several regions. Major typhoons such as In terms of access to sanitation facilities, about Odette (international name: Rai) in 2021 and 80.4 percent of Filipino families had “basic Ompong (international name: Mangkhut) sanitation service level” (i.e., used an improved in 2018, to name a few, have devastated the sanitation facility not shared with another country. These two typhoons led to 487 households), 13.5 percent had “limited-service fatalities, about PHP63.6 billion in damages level” (i.e., used an improved sanitation to infrastructure, and PHP44.4 billion in facility shared with two or more households). damages to agriculture. Besides typhoons, Again, less than 10 percent had no sanitation monsoon rains, the inter-tropical convergent facility (i.e., practicing open defecation), or zones and severe thunderstorms also visit and use “unimproved service level” (i.e., used pit leave damages in the country. latrines without a slab or platform, hanging latrines or bucket latrines). Energy Affordability, accessibility, and reliability are domestic manufacturing growth has lagged the three aspects of energy security. in recent decades relative to its neighbors. A previous study18 shows that high electricity The Philippines, historically, has one of the prices are one of the contributory factors why highest electricity prices17 in the Asian region the economic transformation of the Philippines (See Table 12.1). Consequently, the country did not follow the usual development patterns fails to attract foreign direct investment (FDI), seen in high-income countries.19 especially energy-intensive FDI—one reason Chapter 12 Expand and Upgrade Infrastructure | 269 As a net importer of energy, the Philippines (See Table 12.1). Electricity consumption per is highly susceptible to volatility in the capita in the Philippines is the lowest compared prices of fuel in the international market. to the other countries in the Association of Any major event affecting the value chain of Southeast Asian Nations (ASEAN). The lower fuels, such as the attack on two Saudi Aramco electrification rates and high prices in the oil facilities in 2019 and the Russia–Ukraine Philippines partly explain the low per capita war, impacted domestic prices. The continuing consumption. As of 2019, the Philippines escalation of fossil fuel prices in 2021 and had a 26.2 gigawatt (GW) capacity serving 2022 increased the risk of fossil power plants 111 million Filipinos. In comparison, Thailand, becoming stranded assets. Malaysia, and Singapore each has large power capacities serving smaller populations than Power supply is limited and per capita the Philippines. Transmission and distribution consumption is low. Comparing key economic losses have also been relatively high (9.4% of and energy indicators in select economies20 the total electricity output), suggesting an reveals that the Philippines has limited power inefficient grid and distribution system. supply and low per capita consumption Table 12.1 Key Economic and Energy Indicators in Select Countries Per capita Per capita Net Share of Population Per capita Electricity Residential electricity electricity installed renewables (million), GDP transmission Electricity generation consumption electricity in electricity 2021 (constant and Prices (MWh/ (MWh/cap), capacity production* 2015 US$), distribution (USc/ cap), 2020 2019 (GW), 2019 (%), 2020 2021 losses** (% of kWh,) output), 2014 Dec 2021 Philippines 0.88 0.90 26.2 23.5 111.0 3,412.6 9.4 16.3 Indonesia 1.00 1.00 66.8 13.2 276.4 3,855.8 9.4 9.6 Thailand 2.53 2.90 45.3 14.8 70.0 6,270.4 6.1 10.4 Malaysia 4.69 5.10 34.2 12.2 32.8 10,827.3 5.8 5.00 Singapore 8.60 9.50 12.6 2.0 5.5 66,176.4 2.0 18.3 China 5.37 5.10 2,064.7 28.3 1,412.4 11,188.3 5.5 8.1 Japan 7.44 7.90 346.5 24.6 125.7 35,278.4 4.3 32.6 South Korea 10.75 10.90 132.1 8.9 51.7 32,644.7 3.3 10.0 New Zealand 9.28 8.40 9.4 78.8 5.1 40,779.0 6.5 18.6 GDP = gross domestic product, GW = gigawatt, MWh/cap = megawatt-hour per capita. * Renewables include electricity production from hydropower, solar, wind, biomass and waste, geothermal, wave, and tidal sources. ** Electric power transmission and distribution losses include losses in transmission between sources of supply and points of distribution and in the distribution to consumers, including pilferage. Notes: Per capita electricity generation from Our World in Data; per capita electricity consumption are from International Energy Agency; and net installed electricity capacity are from United Nations Statistics Division. Population data, per capita GDP, and electricity transmission and distribution losses are from World Development Indicators. Residential electricity prices are from Global Petrol Prices. Sources: Our World in Data. https://ourworldindata.org; International Energy Agency. https://www.iea.org; United Nations Data. http://data.un.org; UN Statistics Division. https://unstats.un.org; World Development Indicators. https://data.worldbank.org Global Petrol Prices. https://www.globalpetrolprices.com Shocks brought changes in supply and gas plants decreased, but its percentage share demand patterns. Electricity consumption in terms of total generation increased. The dropped during the lockdown at the height of generation of other sources stayed at about the the COVID-19 pandemic. Coal generation fell same levels prior to the pandemic, with solar dramatically. Power generation from natural and biomass generation growing slightly.21 The 270 | Philippine Development Plan 2023-2028 indigenous Malampaya gas generates a third Right-of-way issues exacerbate the problems of the electricity in Luzon. With its impending and delays in completing transmission projects. depletion and absence of an indigenous There is also continuing threat to the resiliency replacement, there is an aggressive push of the grid due to disasters, both natural and to develop the liquefied natural gas (LNG) man-made. With insufficient level of ancillary industry. Two of the six projects approved services that helps maintain the proper flow by the Department of Energy (DOE)22 are and direction of electricity and address expected to supply the requirements of the imbalances between supply and demand, existing anchor markets of Malampaya. the problems on reliability of energy supply continue to persist. The national grid remains The frequent forced and unplanned outages of fragmented with the delayed implementation power plants resulted in supply deficiency that of the Mindanao–Visayas Interconnection. disrupted business operations. Total electrification is yet to be achieved. As Restrictions on foreign ownership of of 2021, 5 percent of Filipino households still inexhaustible energy projects have been live without electricity, bereft of the benefits relaxed. The Implementing Rules and including increased welfare and productivity, Regulations of the Renewable Energy Act of education, and improved indoor air quality.23 2008 restricts the exploration, development Majority of these unenergized households are and utilization of renewable energy (RE) located in Abra, Albay, Masbate, Basilan, Sulu, resources to companies or corporations that Tawi-Tawi, and Lanao Del Sur and are being are at least 60-percent owned by Filipino catered by ailing and problematic electric citizens, following the provisions of Article XII cooperatives (ECs). Nonetheless, as electricity of the Constitution. access is viewed a tool to uplift the lives of Filipinos, the government issued Executive Nonetheless, the Department of Justice (DOJ) Order (EO) No. 156 series of 2021 and recently released a legal opinion exempting RA 11646 or the Microgrid Systems Act.11. inexhaustible RE sources from 60:40 foreign equity/ownership restriction. On Many ECs are ailing financially. Outside of November 15, 2022, Department Circular No. the Meralco franchise area, electricity is mainly 2022-11-0034 was issued allowing 100 percent supplied by ECs. Most ECs face management foreign ownership of RE projects where issues, such as lack of long-term power supply applicable. This move is aimed at achieving the agreement, high incidence of power pilferages, government’s target to increase the share of RE unreliable distribution system (due to obsolete, in the power generation mix to 35% by 2030 aged or dilapidated distribution facilities), and 50% by 2040. and inability of customers to pay. Some ECs charge lower rates than private distribution Grid congestion continues to hamper utilities, but more brownouts and low-voltage the reliability of the energy supply. The episodes attend their power supply.24 To modernization of the grid to accommodate avoid unreliable power supply, firms that can more renewable energy is moving at a slow pace. potentially provide jobs and contribute to Chapter 12 Expand and Upgrade Infrastructure | 271 rural development choose to locate instead in the cost of doing business. Processing and areas served by private distribution utilities. approval of energy projects takes an average Consequently, the failure to attract more of 1,876 calendar days with 359 signatories investments that would increase demand in from 74 agencies required. The enactment of their services areas, in turn, contributes to the RA No. 11234 established the Energy Virtual low financial viability of these ECs. One-Stop Shop System to streamline the permitting processes for new power generation, Delays in the processing and approval of transmission, or distribution projects. energy projects unnecessarily increased Social Infrastructure The health system is characterized by an For instance, during Typhoon Odette in 2021, inadequate and inequitable access to health 210 health facilities were destroyed while the facilities. While the country has a total resulting water shortage increased the risks of capacity of 109,346 hospital beds in 2021, disease outbreaks. this translates to about one bed only per 1,000 population. As of October 2021, only Meanwhile, inadequacies in infrastructure 68 percent of barangays are covered by a rural support continue to hamper the attainment health unit and health center as opposed to of the goals in the education sector. As of DOH’s target of 80 percent. As reported in August 2022, there is still a shortage of around the Philippine Health Facility Development 91,000 classrooms, which is about 10 percent Plan (PHFDP) 2020–2040, only 50 percent of of the total needed classrooms.27 There are Filipinos in 2020 have access to frontline health still 2,298 “Last Mile Schools” in remote or facilities, i.e., within 30 minutes of travel time. marginalized areas with substandard and/or inadequate facilities and services.28 There are lingering inefficiencies still in the implementation of the Health Facilities The outbreak of the COVID-19 pandemic only Enhancement Program, wherein unutilized, exposed the insufficiency of infrastructure unimplemented, and improperly executed investment in the sector, particularly in contracts have been identified as a source information and communications technology of wastage in the use of funds, per a 2021 (ICT) support for learners, which made report from the Commission on Audit.25 distance or blended-learning more difficult Project implementation was also sidelined at for them. As of 2021, only about 80 percent of the height of the pandemic in 2020 and 2021 schools have functional computers while 65 to when temporary treatment and monitoring 70 percent have stable internet access. 29 facilities and other COVID-19-related health facilities (e.g., isolation and quarantine Nevertheless, there have been some gains facilities) were prioritized over frontline in the provision of other basic facilities. facilities.26 In addition, climate-related events For instance, 92 percent of public schools have also negatively affected the health sector. have access to electricity in 2021. Meanwhile, 272 | Philippine Development Plan 2023-2028 in terms of water, sanitation, and hygiene recovery facilities (MRF), and only 29 percent facilities, the ideal ratios for all levels of basic by sanitary landfill facilities (SLF)31. Solid education were achieved in 2021. The ratio for waste diversion (i.e., recycling, composting) the primary levels (K to 6) of 1:25 surpassed remained low at 54 percent as of 2021. the target of 1:30. Meanwhile, at 1:39 for junior high school level and 1:35 for senior high The National Solid Waste Management school level, both ratios have already met their Commission (NSWMC) passed a resolution common ideal ratio of 1:40. adopting Total Solid Waste Management Solution that will maximize waste diversion Damages to or suboptimal use of classrooms and optimize use of waste disposal sites. caused significant disruptions in classes. Nonetheless, diversion of plastic waste has From 2015 to 2020, the Department of been very low at nine percent with only Education reported 10,675 schools as heavily 489 LGUs adopting ordinances to regulate damaged by natural disasters (e.g., tropical single use plastics. cyclones, earthquakes). Meanwhile, 35,648 classrooms in 11,522 schools in the country The Department of Environment and Natural have been used as temporary evacuation Resources (DENR) has issued guidelines centers, thus displacing or suspending the governing waste-to-energy (WtE) facilities usual teaching or learning activities in them.30 for the Integrated Management of Municipal Solid Wastes. Likewise, DOE has issued Solid waste continues to be a significant policies and implemented programs that aim environmental issue. In 2020, the estimated to promote WtE facilities as baseload RE and volume of waste generated was close to prescribed policies and programs to enhance 17 MMT, with almost a third of the materials the participation of the electric power industry coming from Metro Manila. Only 39 percent players in the development of WtE facilities.32 of all barangays are served by material Challenges Infrastructure is critical to the economic but also for adequate maintenance and transformation of the country. The provision of rehabilitation. Thus, the major challenges for adequate, quality, sustainable, resilient, and safe the sector include financing of investments, infrastructure will require well-coordinated, coordination of plans and programs across huge investments not only for new agencies and across levels of government, and constructions, expansions and improvements, ensuring asset preservation and resiliency. Chapter 12 Expand and Upgrade Infrastructure | 273 Connectivity The implementation of the National and potholes), and lack separate lanes for Transport Policy is difficult without active transport. a National Master Plan and sufficient data. Due to limited transport-related Pursuing or expanding the current PUV data and guidelines for data collection and Service Contracting Program requires management, most of the existing demand appropriate balancing between enhancing data do not reflect evolving travel patterns service standards and fiscal sustainability. under new normal conditions. Transport Implementation of innovative transport demand surveys and master plans are not schemes such as service contracting first regularly undertaken or updated, and usually introduced in Metro Manila have yet to done only when assistance from development be replicated in other parts of the country. partners is available. Meanwhile, most transport operators and drivers remain strapped financially since they Public high-capacity transportation is unable are mandated to keep fares affordable despite to meet current and future demand. Mass high inflation and rising fuel costs. Extending transportation supply in the form of modern them coverage under the service contracting public utility vehicles (PUVs), busways, scheme however will require huge fiscal railways, and ferry systems is still inadequate. resources, which may not be sustainable, and As a result, the use of lower-capacity transport therefore needs to be carefully considered. modes like private vehicles is still prevalent and contributes to worsening traffic congestion, Air traffic congestion is likely to persist, if especially in highly urbanized cities. Transit not worsen, without the needed investments stations and intermodal interchanges lack in developing, upgrading and improving service standards and remain inconvenient, airports. Airport capacities in 2022 will uncomfortable, and inefficient. Poor last-mile be inadequate to cater to domestic and connectivity also discourages private motorists international aviation demand, which is from shifting to public mass transportation. expected to recover by 2025. Aggravating the congestion in many domestic airports is their Active transport will remain nonviable for lack of night landing capabilities. Meanwhile, commuters without adequate infrastructure the expansion of some existing airports may and support facilities. Although most not be technically and/or financially feasible. Filipinos are not car owners, for them active transport is still a nonviable commute option. Achieving universally accessible and For one, support facilities (e.g., bike storage gender-responsive transport facility designs and parking, shower facilities, and lockers) needs a shift in construction priorities and are insufficient. Moreover, transport corridors practices, and in carrying out coordination are designed to serve private motorists, are and advocacy. Although there have been many non-climate-responsive and unsafe (e.g., with laws and regulations that require transport poor lighting, uneven pavement, road hazards, facilities to be accessible for people with 274 | Philippine Development Plan 2023-2028 special mobility needs, compliance has been This is largely due to low-quality infrastructure, incomplete due to minimal investments in inconsistent regulations, and inefficient past decades. The physical designs of various operations. Flow of goods to and from infrastructure do not conform to the standards ports is limited by low on-site capacity for of the Accessibility Law, which is supposed to container storage and management. Funding ease the access to and use of such facilities by to modernize and equip government-operated those with special needs. Addressing the needs ports and LGU-operated ports is inadequate. of pedestrians, cyclists, PWDs, and public Intermodal transport facilities must be transport users by modifying the priorities prioritized to move goods effectively and and changing existing policies of road efficiently. However, there are only a few projects by national and local agencies are inland container terminals, and none of them the major challenges. Despite the enactment is connected to the port by freight rail. of the Safe Spaces Act and other laws, efforts have been weak and uncoordinated in Transport corridors supporting airports and addressing gender-based violence-sexual ports will continue to impede movement of exploitation, abuse and harassment and goods if not upgraded. Movement of goods discrimination in public spaces, especially in and services from gateways and production the transport sector. areas to markets is currently limited to road-based transportation options. However, Ensuring travel safety on road transport the roads leading to ports and airports are corridors while aiming to increase travel often congested and deteriorate faster due speeds poses a challenge. Travelling along to heavy truck loads. Moreover, lack of existing primary national roads could be coordination among government entities slower than 30 kilometers per hour when results in non-uniform and fragmented passing through an urban area with over regulations such as truck ban policies and 100,000 people. Adding to the travel delays pass-through requirements. Addressing these and to the hazards faced by road users, if not issues as well pursuing the plans to establish addressed, are the slow-moving vehicles plying long-haul freight rail and waterway transport along the national roads, uncontrolled PUV lines will speed up the transport of goods loading and unloading in road intersections; across the country. faulty traffic signals; illegally parked vehicles; on-going construction, maintenance, and The disparity in access to and high water works; electric and telecommunication costs of digital services in the country poles erected in roadside kerbs; and ambulant indicate inadequate investments in digital vendors plying their trade along carriageways. infrastructure. The outdated laws and existing regulatory regime are ineffective Low-quality infrastructure, inconsistent to address high entry barriers in the digital regulations, and inefficient operations leads services market, thereby limiting competition to high logistics cost. The Philippines has among service providers, affecting broadband one of the highest logistics costs and rates of prices, and restricting investments for congestion among ASEAN member-states.33 infrastructure buildup and expansion, Chapter 12 Expand and Upgrade Infrastructure | 275 especially in geographically isolated and disabilities) also remains digitally excluded disadvantaged areas (GIDAs). A segment of with the existing digital services not designed Filipino population (including persons with to cater to their special needs. Water Resources Effective management of the country’s water when comprehensive land use plans are resources is faced with numerous challenges. divorced or unharmonized from water use These include the multiplicity of water-related and resource plans. agencies without a clear and/or unified objective, increasing hydrologic variability Hydrologic variability and erracity further and irregularity under a changing climate, the complicates water resources management inadequacy of water-related information, the and planning. The increase in hydrologic poor planning and financing of infrastructure, variability (i.e., large fluctuations of seasonal the unaddressed competing and changing rainfall or extreme weather events) as an priorities of water infrastructure uses, and the impact of climate change is another major inefficient water utilization and delivery of challenge to the sector. Extreme weather events irrigation systems. such as intense rainfall (resulting in floods), strong winds and typhoons (resulting in storm The weak and fragmented institutional set-up surges), and prolonged hot seasons (resulting continues to be a fundamental hindrance in droughts and decreased agricultural in the sector. As of 2021, there are over 30 productivity) have become more frequent in water-related agencies with overlapping and recent years. Weather patterns fluctuate over at times conflicting mandates or functions time and vary widely in different parts of the over the country’s water resources. The lack country, thus requiring location-specific flood of coordination between said government and drought mitigation schemes, as well as agencies and the varied users of the resource water infrastructures that are adaptable to results in unintegrated or “siloed” planning and changing climate conditions. Climate change policy-making, characterized by subsector-, effects on the water cycle will continue to program-, or project-specific government strain built infrastructures through increased interventions in water supply, sewerage and evaporation, salinization, and physical sanitation provision, irrigation delivery, flood damages. These will not only affect service management, watershed management, and provision efficiency, but also incur recovery coastal management, without proper regard costs, economic losses, and societal impacts. for the other uses of the resource. Water decisions and financing priorities are often Water-related data collection remains made according to political jurisdictions and inadequate. The inability of the government influences without due regard for hydrologic to properly assess the state of water resources boundaries such as river basin or aquifer in the country is due to insufficient and boundaries as planning or management units. scant water-related data collection, in as Said fragmentation issue is further aggravated far as time–space sampling frequency and 276 | Philippine Development Plan 2023-2028 consideration of climate projections on water Competing and changing priorities of cycle are concerned. For instance, the DPWH’s water infrastructures remain unaddressed. Bureau of Design only has a total of 249 A challenge in multi-purpose water streamflow gaging stations all over the country. infrastructures is the competing priorities Groundwater data is also scarce and generally of the different water users involved with collected either on project basis or during the its operations. For example, when a dam’s conduct of well development pumping tests design is built for the purposes of water for one-time water permit applications. There supply, irrigation, and hydropower, the are no proper management or surveillance reduced irrigation water allocation due to the techniques to detect users that extract surface conversion of agricultural areas to residential, water or groundwater excessively. The impacts commercial, and industrial areas, results in of watershed degradation especially by the under-utilization and reduced power deforestation, which results in excessive soil generation of its hydropower plant. Likewise, erosion and reduced water infiltration, are not a multipurpose reservoir with water supply as properly monitored. its primary purpose will prioritize conserving water for the dry season by accumulating Poor water infrastructure planning, water during the wet season, and yet its flood financing, and management persists. The control function would require ensuring absence of an updated and comprehensive available reservoir capacity for flood allocation inventory of all water-related infrastructure storage by releasing water before the expected (e.g., water supply, irrigation facilities, and heavy rainfall. flood control infrastructures) hinders the facilitation of a harmonized rehabilitation Existing irrigation infrastructure facilities and maintenance program, leading to require significant overhaul or redesign. The the unmanaged deterioration of many use of open irrigation ditches or canals is prone water-related infrastructures. Said challenge to leakage due to damages during the typhoon is exacerbated by the inadequate financial season. Likewise, open canals are susceptible and technical capacities of institutions in to sedimentation, thus, reducing the canal’s planning and implementing water related capacities resulting in water spillage and slow infrastructure projects. water conveyance. Energy The challenges in the sector are making energy of the Electric Vehicle Industry Development more secure and cost-competitive, achieving Act is desirable for low-carbon growth, the an optimal energy mix and adequate energy switch to electric vehicles is expected to supply, and ensuring efficient delivery of increase electricity demand. Thus, there is an electricity and judicious use of energy. With urgent need for a replacement to the depleting Ambisyon Natin 2040, electricity consumption Malampaya gas to avoid supply shortage. was projected to grow to nearly four times its Mandatory and preferential dispatch of RE34 2019 level by 2040. While the implementation is expected to boost RE investments; however, Chapter 12 Expand and Upgrade Infrastructure | 277 such policy must not conflict with the objective is also an immediate challenge. Achieving of reducing energy costs. Likewise, cushioning energy security likewise requires resiliency the impact on low-income households of against climate-related events that cause rising energy prices brought about by the power disruptions. continuing disruption in the global value chain Social Infrastructure The state of the Philippine health inadvertently constrains the public’s access to infrastructure has to catch up with globally health care. accepted standards. The country’s public spending on health is at 1.69 percent of GDP Poor implementation and disasters resulted (in 2019), which is among the lowest in the in the weak delivery and inefficient use of ASEAN35 and is very far from the 4–6 percent education facilities. Disbursement of the of GDP level of spending needed to attain Basic Education Facilities Fund remains low universal health coverage.36 The country’s with an average rate of 48.4 percent from health system remains hospital-centric. 2017 to 2021.38 This resulted in the actual Hospital care accounted for 50 percent of delivery of only 44 percent of the targeted total health spending in 2018. Primary care classrooms from 2018 to 2021.39 Among the accounted for only 4 percent in same year.37 problems encountered in the implementation Corollary to this, average bed density in of school infrastructure projects include the Philippines is way below the four beds site unavailability, rigid pricing and per 1,000 population recommended for an specifications, procurement issues, and upper-middle-income country. delayed identification of project list.40 As proven during the COVID-19 pandemic As the country is highly vulnerable to natural and in times of natural disasters, the health disasters, the lack of infrastructure dedicated infrastructure is still not ready to respond for disaster and calamity preparedness and to public health emergencies. In addition to resilience will continue to exacerbate the the continued provision of essential services, inadequacy of classrooms, which are used as capacities for basic epidemiology and disease temporary evacuation centers. surveillance, especially at the subnational level, need to be enhanced. Solid waste management (SWM) facilities remain inadequate to cope with the increasing While the Philippine Health Facility rate of waste generation, especially in urban Development Plan 2020–2040 was formulated areas. Majority of local areas are still unserved to guide the equitable development by common waste facilities, including material of the country’s health infrastructure, recovery facilities and by sanitary landfill its implementation is challenged by facilities. The sector continues to be hampered uncoordinated planning and lack of sustained by the following challenges, among others: financing causing substantial delays and 278 | Philippine Development Plan 2023-2028 (a) lack of updated data on sources and (e) availability, suitability, and social composition of waste; acceptability issues in site selection for (b) lack of clear policy direction on common waste disposal facilities; and clustering of LGUs; (f) limited segregation-at-source (c) lack of technical and financial due to low awareness on capacities of LGUs in implementing waste recycling, recovery solid waste management projects; and composting technologies. (d) low willingness of LGU constituents to pay for SWM services; Strategy Framework To enable economic transformation for a sector over the medium term is to “Build prosperous, inclusive, and resilient society, the Better More.” overarching objective for the infrastructure Figure 12.1 Strategy Framework to Expand and Upgrade Infrastructure SUSTAINABLE, RESILIENT, INTEGRATED, AND MODERNIZED INFRASTRUCTURE FACILITIES AND SERVICES DELIVERED PLANNING, PROGRAMMING, WATER SECURITY, SEAMLESS AND INCLUSIVE AFFORDABLE, ECOLOGICAL INTEGRITY OF ENHANCED SUPPORT AND ASSET MANAGEMENT CONNECTIVITY ACHIEVED WATER SYSTEMS, AND ACCESSIBLE, RELIABLE, AND TO SOCIAL DEVELOPMENT IN INFRASTRUCTURE (VIA LOCAL AND RESILIENCY TO WATER CLEAN ENERGY PROVIDED PROVIDED ENHANCED INTERNATIONAL LINKAGES) HAZARDS ATTAINED Implement integrated Move people, goods, Upgrade and expand Implement Ensure equitable master-planning and information water infrastructure game-changing access to health development and through modernized reforms to bring down and education covergence programs and expanded transport Strengthen the cost of electricity infrastructure, in and digital integrated water partnership with Embed resilient and infrastructure resources Enhance delivery of the private sector innovative solutions in mangement (IWRM) energy by infrastructure design Address universal implementation coordinating Improve resiliency mobility and investment in to support health Fully implement asset connectivity needs Invest in water generation, and educational management and infrastructure transmission, and outcomes preservation Modernize the fleet and services provision distribution provide quality ancillary Pursue optimal services Provide accessible Provide an enabling solid waste Undertake partnerships financing for water environment for the management for financing Invest in advancing and supply and sanitation market to deliver an (SWM) solutions investments expanding access to projects optimal fuel mix digital infrastructure, Invest in or provide and support open Enhance demand side financing for social access through management infrastructure strategic collaboration Invest energy innovation to respond to increasing demand and new markets for clean technology goods and services The strategic framework for Chapter 12 corresponding to each of the infrastructure (Figure 12.1) is geared toward the delivery subsectors: connectivity (physical and of sustainable, resilient, integrated, and digital), water resources, energy, and modern infrastructure systems. It comprises social infrastructure. cross-cutting strategies and specific strategies Chapter 12 Expand and Upgrade Infrastructure | 279 Strategies Outcome 1: Planning, programming, and asset management in infrastructure enhanced Implement integrated Embed resilient and innovative master-planning development and solutions in infrastructure design convergence programs The Philippines is highly vulnerable to climate As master plans provide a sound basis for change and natural disasters. For this reason, rational prioritization and a holistic approach mainstreaming resiliency and sustainability to socioeconomic development, master considerations in the present infrastructure plan formulation for infrastructure will be planning and investment is imperative to harmonized and strategically integrated to withstand future economic shocks and to guide the planning, programming, budgeting, reduce additional costs and financial burdens and implementation of infrastructure projects. caused by climate change and natural disasters. The different government master planning Enhancing the resilience of infrastructure to processes will be enhanced and rationalized the impacts of climate-related extreme events to ensure that master plans are coordinated can also protect lives and human health, as across all government levels, and remain well as help sustain economic growth. synergistic, responsive to the emerging issues Resilient infrastructure will ensure continuous and consistent with priority development service delivery and extend the useful life of strategies of the sector. assets. Climate resilience will be mainstreamed Moreover, the government will continue to in infrastructure planning and investment implement convergence programs to ensure so that climate risks are considered and complementarity of efforts in the roll out of managed across all types of infrastructure infrastructure identified in sectoral or spatial and throughout the lifecycle of infrastructure master plans. assets and operations. Moreover, innovative technologies, including nature-based solutions Over a reasonable transition period, the (NBS), will be employed in infrastructure responsibilities for local infrastructure planning and design. planning and development will be fully devolved to local governments. Capacities of Fully implement asset management local governments to assume the responsibility and preservation and accountability for infrastructure outcomes To ensure the cost-effective management of within their jurisdictions will be built. assets, the government will analyze the lifecycle, capacity, and utilization of infrastructure assets individually and collectively, with the view to optimizing government funds and targeting scarce resources to the most critical 280 | Philippine Development Plan 2023-2028 asset needs. The government will ensure that development priorities. While reinvigorating infrastructure assets will be efficiently and PPPs, the government will clarify allocation effectively maintained and rehabilitated, as of responsibilities to integrate climate risks necessary, to maximize their economic life. in planning, management, or operation of infrastructure. To attract additional private Undertake strategic partnerships for investors, the government will develop financing investments projects and promote infrastructure plans with prospects of good financial returns. Annual public infrastructure spending in 2017–2021 ranged from 4.2 percent to The government will continue to strategically 5.8 percent of GDP, which is about twice engage multilateral and bilateral development as much as the average spending over the partners for external financing to capitalize on previous five decades. Over the next Plan their comparative advantages and benefit from implementation period, annual spending on knowledge and technology transfers. infrastructure will be sustained at 5 percent to 6 percent of GDP. In line with this, the To ensure that the increase of available government will continue to tap viable funding financial resources of LGUs pursuant to mechanisms to augment the public resources the Mandanas-Garcia ruling contributes in financing critical infrastructure projects. maximally to socioeconomic development, the national government will assist LGUs by By leveraging the private sector’s efficiency, providing technical assistance and setting resources, expertise, and innovativeness, service delivery standards. Together with the government can reinvigorate PPPs in LGUs, the national government will explore financing priority infrastructure projects. This appropriate cost-sharing arrangements in the will ensure the sustainability of operations implementation of devolved infrastructure of infrastructure facilities and free up projects. LGU capacity to prepare and fiscal space for other social programs and structure PPPs will also be improved. Connectivity Outcome 2: Seamless and inclusive connectivity via local and international linkages achieved Move people, goods and information will integrate land use and urban planning through modernized and expanded methodologies (e.g., transit-oriented transport and digital infrastructure, development, township approach, and with active participation of the high-density development), will guide the private sector rational development of an intermodal transport infrastructure network that takes A National Transportation Master Plan into consideration compatibility, economic will be formulated and adopted. The feasibility, comparative advantages, climate National Transportation Master Plan, which Chapter 12 Expand and Upgrade Infrastructure | 281 risks, and linkages of desired transportation Safe and well-connected active mobility modes. Baseline data and information will networks will be established. This will be regularly collected, updated, consolidated, involve, among others, widening of sidewalks; and managed. adding segregated micro-mobility corridors; developing greenways, car-free zones and Intermodal transport facilities will be bike-only roads, and other public open spaces; constructed and upgraded to achieve redesigning and reconstructing existing seamless connectivity. Rationalizing intersections; and re-evaluating interchanges intermodal linkages and hubs will provide order and grade separators to accommodate at-grade in passenger movement and decrease traffic pedestrian crossings and bike turning spaces. congestion inside urban centers and across regions. Trains and buses shall serve medium- Local government units and private developers and long-distance travel demands. Last mile will be incentivized to have pedestrian-friendly connectivity through active transport shall be and bikeable developments and programs. enhanced to improve access to transit stations LGUs will also be encouraged to measure walk and encourage mass transportation usage. scores, walkability, bikeability, and accessibility within their jurisdictions. Design standards for transit stations and interchanges shall be adopted with emphasis Applicable mass transportation systems (i.e., on convenient transfers, high levels of service, railways, road-based, and ferry systems) will universal accessibility, gender inclusivity, and be developed in metropolitan areas. Mass sustainability. The standards and regulation transportation systems will be prioritized. for a national automated fare collection system The roll-out of the planned rail infrastructure shall be adopted to establish interoperability projects will be pursued aggressively. Railways across all transport modes. will be expanded from north to south and from east to west, connecting growth nodes Active transport networks will be developed. and strategic infrastructure. Inter-city rails Pedestrians and cyclists will be accorded will be built in metropolitan regions across highest priority in the hierarchy of road the country. Policies will be adopted to ensure users. Provisions for active mobility will be availability of highly specialized spare parts integrated into the transportation system. and supplies. Existing thoroughfares and bridges will be redesigned and retrofitted for the protection Bus rapid transit systems will be adopted to and expansion of bikers and pedestrians. enhance the efficient use of public transport Shade trees will be planted in urban areas to vehicles and existing road spaces. Existing lessen the urban heat island effect, improve ferry systems will be upgraded and other climate resiliency, and improve biodiversity. coastal and inland waterways transport Ancillary infrastructure such as segregated systems will be established as an alternative active mobility corridors, showers, widened sustainable transport mode to further improve sidewalks, lockers, and storage facilities the connectivity of ports to the national will be constructed. transport system. 282 | Philippine Development Plan 2023-2028 Reforms in the provision of public transport nautical highway network will be pursued. services will be strengthened. Performance- The missing links in the road network will and incentive-based service plans and be completed and viable inter-island bridges alternative financing arrangements will be will be constructed. Road transport corridors explored. Transition of public transport leading to airports and ports will be upgraded, operations from competition among individual including installation of weighbridges to operators toward industry consolidation and prevent overloading. common fleet management using higher capacity and environmentally sustainable Existing airports will be improved and vehicles will be facilitated. new ones will be strategically developed to address future demand. Existing airports The Public Utility Vehicle Modernization will be upgraded to meet aerodrome design Program will be re-designed so that the supply safety standards set by international and local of modern public transport can be increased airport authorities, including development while managing its resulting fiscal impact. and improvement of access roads. Bundling of airports as possible PPP projects will be pursued The nautical highway will be improved. to encourage private sector investments. Seaports will be constructed and expanded to support economic sectors such as agriculture Gateway airports will be developed and and trade. New linkages and strategic location connected to feeder airports to facilitate access of new ports will be assessed to create new rural to the country’s various tourist destinations. growth areas. The capacity of RORO facilities Development of new airports will consider will be increased and processes digitized to optimal sites outside urban areas to allow address congestion and delays. Larger RORO rooms for future expansion and possible ports will be constructed to accommodate upgrade to international airports. larger-capacity RORO vessels. These will be supported with modern ancillary facilities Level of service standards will be adopted in all for passengers. The application of electronic airports to quantitatively measure the adequacy terminal management systems such as of airport passenger facilities and plan for the electronic ticketing and manifest submissions applicable interventions. To alleviate airport will be streamlined. Aging fleets will also be traffic congestion, “night-rating” of airports replaced or retrofitted to mitigate the risk of will be continued. maritime accidents. Implementation of the Cargo and freight rail infrastructure to Maritime Industry Development Plan will connect strategic infrastructure such as be continued to achieve a more sustainable ports will be developed and expanded. and globally competitive maritime sector Railway development for cargo and freight will through maritime education, technology, be prioritized, particularly for long-distance and innovations. deliveries. Meanwhile, truck routes will The construction, expansion, and upgrading be established to service medium- and of roads and routes that are aligned with the short-distance deliveries. Dry ports and other Chapter 12 Expand and Upgrade Infrastructure | 283 inland cargo terminals will be connected by Underground utility corridors for electricity freight rail to ease the movement of goods to and telecommunications cables, water supply, or from the ports. sewage, and other utilities will be established to secure public safety. Through these corridors, Cold chain logistics and management utility lines will be placed in accessible spaces facilities will be developed. Government so as to minimize traffic disruptions and other will implement cold chain logistics projects surface activities when system upgrades or to secure the transportation throughout repairs will be done. the supply chain of temperature-sensitive commodities and products, such as perishable Digital infrastructure will be modernized food products, medical supplies, and other and expanded. Advancing the country’s pharmaceutical supplies. digital infrastructure entails effective government stewardship of the sector, in order The implementation of the ULP and to facilitate private sector investments toward Transport Accreditation, Permit and Pass modernizing digital infrastructures, to expand for Ports (TAPPP) will be made seamless access in GIDAs, and to encourage strategic and well-integrated. To facilitate the transport collaborations for pursuing open-access of basic goods and necessities, the ULP and networks that will benefit all market players. TAPPP will be implemented cohesively throughout the country. This will further To foster effective competition and level the streamline the varying and burdensome playing field, the government will strongly pass-through requirements and restrictions push for necessary reforms and undertake the of ports, economic zones, and LGUs, as following: well as promote a more business-conducive environment in the logistics sector. 1. Review the regulatory landscape and strengthen the policy and regulatory Transport safety and security will be environment to encourage just and ensured. The government will ensure that transparent interconnection among the transport hubs are equipped with additional industry players and establish effective safety features such as closed-circuit television, open-access network, baggage scanner, proper lighting, and real-time passenger information system. The Philippine 2. Nurture and promote facilities-based Coast Guard will pursue its modernization competition so that industry players program involving, among others, the consistently invest to advance their digital procurement of modern air and floating assets infrastructures, thereby benefitting the and interoperable communication systems. general public, and, Safety audits on transport corridors will be 3. Streamline bureaucratic processes and continued to inform the allocation of sufficient relax the administrative procedures budgetary support. Other potential financing and licensing requirements to ease sources from congestion pricing and parking market entry. levies, among others, will be explored. 284 | Philippine Development Plan 2023-2028 To facilitate the roll-out of broadband Facilities for the mobility needs of women and infrastructure in less profitable or remote men commuters from all sectors (i.e., PWDs, areas, the government will strategically use senior citizens, , and indigenous peoples) of its existing assets and adequately invest to will be provided. Gender mainstreaming, help meet the requirements in the domestic inclusion, and accessibility will be integrated backbone and middle-mile segments. It will in the monitoring and evaluation (M&E) also encourage infrastructure sharing among mechanism. Collection of sex-disaggregated industry players. data and other gender and social inclusion data will be strengthened. Address universal mobility and connectivity needs Universal digital connectivity needs will be addressed. To help in building a Gender mainstreaming, inclusion, and digitally connected and inclusive society, the accessibility will be main considerations in all government will promote accessibility and stages of transport project implementation. assistive technology innovations. This will The Philippine Harmonized Gender and further ensure equal access such that all people Development Guidelines (HGDG) will be are encouraged and empowered to use digital integrated in all phases of infrastructure services (See Chapter 8). project development and implementation. Water Resources Outcome 3: Water security, ecological integrity of water systems, and resiliency to water hazards attained The strategy in the water sector is to implement (d.) ensure good sanitation and drainage effective water governance through integrated (including proper disposal); water resource management (IWRM) as applied in the planning and management of (e.) protect land, water and coastal resources; land, water, and coastal resources. The major (f.) protect life and property from water and pillars in this strategy are as follows: coastal hazards including dam-related (a.) ensure water availability through efficient hazards; and water infrastructures and management; (g.) manage flood effectively (with sediment (b.) allocate and utilize water efficiently control) and mitigate droughts. especially over competing water uses; Upgrade and expand water (c.) maintain and enhance surface and ground infrastructure water quality; 1. Implement the Philippine Water Supply and Sanitation Master Plan (PWSSMP), the National Irrigation Master Plan Chapter 12 Expand and Upgrade Infrastructure | 285 (NIMP), the National Water Security (e) Flood control and coastal protection Road Map (NWSRM) and various Flood infrastructures with hybrid systems, Master Plans for Metro Manila and major that is, a combination of nature-based river basins. As necessary, the master solutions (NBS) and engineered or plans should be revised and modified gray structures. In NBS, floodplains, based on location-specific conditions and wetlands, and forests are to be prioritization and timing of investments. restored and enhanced to store In essence, the plans shall be adaptive, and attenuate flood waters, while and the planning process iterative engineered structures such as flood and interactive. walls, embankments, and detention ponds should be skillfully designed 2. The following infrastructure will in combination with the NBS. be prioritized: 3. Country-wide guidelines shall be (a) Effective and sustainable WSS developed for rainwater harvesting services with cost-efficient and considering seasonal availability and well-designed WSS structures. regional variability of rainfall associated Adequate institutional capability with water use, storage requirement, to efficiently operate and maintain and economic benefit. In urban areas WSS systems in terms of service in particular, rainwater harvesting can coverage, performance, and financial be multipurpose, e.g., for household sustainability will be developed. water supply, stormflow reduction and (b) Water storage reservoirs for water groundwater recharge. Investments in supply and drought mitigation, or smart metering and pricing of household multi-purpose dams with flood water use and demand management shall control functions. Reservoirs should be promoted. Public–private partnerships be planned with infinite life so (PPP) shall be encouraged to enhance that sediment deposition can be and strengthen investments in managing avoided through sediment flushing and developing water infrastructures (built-in facility and operations), and services. Obstacles to private sector and integrated with climate risks participation shall be managed. assessments to increase the reliability of service provision and asset life; Strengthen implementation of integrated (c) Irrigation systems with pipe or closed water resource management conduits or conveyance systems. These will be prioritized rather than For integrated water resource management open channel or gravity canals to (IWRM), management instruments include eliminate sedimentation problems. water resources assessment, data collection (d) Proper flood drainage systems in networks, allocation and conflict resolution, irrigation service areas. allocation through market instruments, risk management tools, regulatory instruments, 286 | Philippine Development Plan 2023-2028 communication and information for informed be easily understood by decision makers stakeholder participation, and use of and stakeholders or citizens. technology for research and development. (d) University- or college-based water The following priority strategies in terms of resource centers will be tapped to management instruments will be pursued: undertake problem-oriented research, development, extension, and training (a) The institutional fragmentation of activities related to the water sector on the water resources sector shall be a sustained basis. These centers provide addressed. The main motivation of regional or local presence and can applying institutional reforms within the proactively engage in developing the water bureaucracy is to efficiently orchestrate, research program in the country taking coordinate, and integrate the development cognizance of the public interest in general and management of water resources using as well as facilitating interaction with IWRM principles (covering integrated local or regional agencies, policymakers, management and harmonization of land and stakeholders. Outsourcing to and coastal resources with water resources university-based water resource centers is including control of water-related more sustainable and efficient for provision hazards) and science-based decision of scientific and technical support support systems. especially with their experiences and knowledge in water resources development (b) The government’s capacity to conduct and management in the countryside. continuous scientific studies will be ensured. The institutional capacities of (e) Investments in data monitoring systems existing agencies to conduct continuous will be made. A rationally designed scientific studies (i.e., data analyses, sampling network for long-term data modeling, scenario simulations) will be monitoring of surface water, ground water, enhanced, with adequate and regular water quality, and sediments data will be funding provided. established all over the country. Proper (c) Decision support system for purposes (statistically and/or physically based) of science-based water resources temporal and spatial sampling frequency planning and management as well as of data collection shall be ensured for multi-stakeholder consultation and throughout the said network. Inefficient public participation will be developed irrigation water utilization especially and maintained. Such decision support for upland rice production may be system shall be based on digital ecosystem addressed with “smart monitoring” of soil framework with interoperable set of data, moisture conditions to optimize irrigation algorithms, methods, and analysis tools scheduling, and by timing the cropping to provide real-time information and season according to type of water calendar, actionable knowledge and insights that can which is location-specific in the country Chapter 12 Expand and Upgrade Infrastructure | 287 (i.e., the rice cropping season cannot be poorly enforced, and low-coverage regulatory uniform for the entire country). regime in the WSS sector. This entails, among others, the consolidation and harmonization (f) Dam safety measures shall be prescribed of tariff-setting methodologies, setting and operations shall be stringently of performance and technical standards, monitored. A dam safety body shall be and establishing policies and processes for created through executive action, with the the granting and revocation of licenses. A goal of ensuring that all dams are safely credible and effective economic regulatory operated, thereby protecting lives and regime is seen to induce the expansion property particularly in times of extreme and improvement of services, encourage weather events. All dam operators shall further private sector participation, protect be made to comply with established safety the interests of consumers, and address the standards in dam operations through conflicts of interest inherent in the current rigorous monitoring and assessments. regulatory agencies. Invest in water infrastructure In addition, a framework for rationally services provision and provide allocating resources for WSS will be accessible financing for water supply established, where government support and sanitation projects will be provided for viability gap funding to Public–private partnerships will be tapped economically viable but financially unviable to deliver needed water infrastructure projects, performance-based grants to enable facilities and services. In particular, for water equitable access to WSS services, and funds or supply and sanitation projects, the economic subsidies to leverage access to market-based regulatory environment will be rationalized lending or private equity. and strengthened to address the fragmented, Energy Outcome 4: Affordable, accessible, reliable, and clean energy provided Implement game-changing reforms Open Access (RCOA). The end goal is to to bring down the cost of electricity set up a competitive retail sector serving households and commercial customers by Reforms stipulated in the Electric Power relaxing the requirements for participation of Industry Reform Act (EPIRA) will be end-users in RCOA. The full implementation completed. The primary strategy to reduce of the Green Energy Option Program— cost and make energy more cost-competitive RCOA’s counterpart with emphasis on RE— is to ensure the completion of the reforms also empowers consumers with a 100-kilowatt as stated in EPIRA and fast-track the full (kW) demand to choose RE as their preferred implementation of Retail Competition and power supply. 288 | Philippine Development Plan 2023-2028 The tax (value-added tax) base will be responsible for incorporating the proposed rationalized so that consumers are not taxed transmission projects in the Competitive for the electricity they do not consume. The Renewable Energy Zones. government shall endeavor to accelerate the privatization of assets, strengthen the The government will enhance the reliability competitive selection process in securing of existing power plants and improve their bilateral power supply contracts, and revisit maintenance scheduling. Complete adherence the rules and regulations on cross-ownership to the Grid Operation and Maintenance between retail electricity suppliers and Program (GOMP) is critical as it establishes generation companies or distribution utilities. the timetable of scheduled outages of power These measures will foster transparency and generating units and transmission facilities. promote fair competition in the implementation The government will also pursue the conduct of the retail competition and open access. of the Performance Assessment and Audit for power generation facilities and distribution The government will explore ways to open utilities to identify the issues, challenges, and and set up new windows of competition: the appropriate policy measures to improve power forward market, reserves market, and capacity systems operations. Finally, the government market. Such measures can help approximate will take measures to incorporate climate the full benefits of competition even with risks in energy infrastructure operations a concentrated generation sector, provided and maintenance. retailers and generators actively use them instead of bilateral contracts. Nonetheless, Enhance the delivery of energy these will be introduced in phases to allow by coordinating investment in greater participation and adjustments as generation, transmission, and challenges arise. distribution The government will endeavor to enhance The entry of more players in renewable the market’s ability to coordinate energy due to the relaxation of the 60–40 investment in generation, transmission, ownership restriction will likely result in and distribution infrastructure and achieve increased generation capacity, consequently total electrification across the country. contributing to cost reduction.41 The recent A well-conceived master plan, oriented to issuance on the Renewable Portfolio Standards coordination, not coercion, of key industry furthers utilization of renewables as the policy players and that accounts for the existing provides a quota for consumers (through the assessment of the industry and provides mandated participants) to purchase RE from incentive-compatible arrangements will 1 percent to 2.52 percent annually starting attract investors to bet on the country for the 2023. As more entrants venture into the sector, long term. the country’s transmission network will need to be prepared as well. The DOE’s exercise of The government will rationalize bureaucratic oversight on the transmission concessionaire processes and remove local-central government is necessary. The concessionaire will be impasse when undertaking investments in Chapter 12 Expand and Upgrade Infrastructure | 289 generation. The LGU Energy Code42 also will implement the Comprehensive Roadmap espouses a convergent framework to facilitate for Electric Vehicle Industry. While the switch putting-up energy projects. The passage of the to electric vehicles is expected to increase the Ease of Doing Business and the Energy Virtual electricity demand, such increase may also One-stop Shop43 are promising ways forward. encourage the entry of more investments in However, the implementation and practices the electric vehicle markets. of the various permit-issuing agencies will be reviewed to ensure the realization of the law’s Provide an enabling environment for true intent. the market to deliver an optimal fuel mix The government will facilitate the upgrading and modernization of transmission and Besides facilitating the market’s ability to distribution lines to support efficient transition provide an optimal fuel mix, the government to cleaner energy. The government will also should also provide correct market incentives resolve transmission congestion, especially for appropriately clean and reliable power. between Luzon and the Visayas grid, whether An optimal fuel mix is a combination of fuel by adding transmission lines or avoiding sources that will deliver adequate and the subsidies that cause the build-up of excess least-social-cost supply of energy toward a capacity. Once the government has the needed smooth transition to cleaner energy according fiscal space, it should revisit and reevaluate to the level of a country’s development. The financing investment in transmission. social cost of pollution includes both the Financing and investment will be separated domestic cost of carbon emissions and the from the regulatory structure of transmission costs of local pollutants (sulfur oxides, nitrous tariffs. Investment in transmission expansion oxides, and particulate matter) that impinge offers enormous potential benefits for efficiency on health. The government will endeavor by increasing access to low-cost generation, to provide an enabling environment for improving reliability, and counterbalancing an efficient energy transition that respects market power. technological neutrality and a level playing field. New investment in generation will use Energy will be delivered to consumers in the most cost-competitive fuel sources. For the off-grid or missionary areas. The subsidies to market to promote these, regulations will be these areas will be gradually reduced as they streamlined, and pollution taxes will replace are progressively connected to the main grid. mandates and feed-in-tariff subsidies to reflect Related policies have been issued on pushing the negative value of pollution. for off-grid development.44 Enhancing private sector participation is a strategy that needs to With the impending depletion of Malampaya be reinforced and strengthened. gas resources, the government will expedite The shift from vehicles that rely on the development of the natural gas industry. conventional fuel modes to electric vehicles Importing liquefied natural gas (LNG) is an will be pursued. Pursuant to the Electric Vehicle immediate solution to this threat. To secure Industry Development Act,45 the government LNG supply overtime, investments in the 290 | Philippine Development Plan 2023-2028 sector should be promoted and guided. the intermittent supply. Along with capacity Toward this, creating an enabling legal and markets are innovative game-changers in the regulatory framework for the natural gas sector for deployment such as energy storage industry should be prioritized. New oil and gas systems and digitalization of energy systems fields shall likewise be explored. As the LNG through the use of ICT (network-connected industry develops, potential demand outside devices) and smart meters (for real-time of electricity generation will also be explored.46 monitoring of energy consumption). Other ways to address intermittency such as Liberalization of foreign ownership of RE diversification of the wind-solar portfolio generation will be pursued to stimulate by type and location and thermal storage investments toward efficient energy (i.e., heat water when solar makes price low or transition.47 The government will revisit the make ice used later for air conditioning) will Implementing Rules and Regulations of the be pursued. RE Act to remove the nationality requirement imposed on businesses engaged in the The government will explore the inclusion of exploration, development, and utilization of nuclear energy in the mix. EO 164 on adopting inexhaustible energy resources. The strategy a national position toward a nuclear energy is to allow the entry of foreign capital into program has set the stage for re-evaluating the country’s RE industry and thereby lower the entry of nuclear energy into the fuel mix. the cost of RE projects, and make clean Rigorous scientific studies will be undertaken energy more accessible to the public. All first before the government will allow these measures will help achieve the targeted investment in nuclear plants. The government, 35 percent share of RE in the power generation through DOE, will also endeavor to make mix by 2030 and 50 percent share by 2040. these scientific studies and actions to be taken transparent, consistent with the guidelines To facilitate the entry of more renewables, of the International Atomic Energy Agency intermittency problems shall be addressed. and accepted by the public. DOE will closely The mandatory and preferential dispatch of work with Congress and the Department of RE is expected to facilitate the increase in Science and Technology in crafting the legal RE investments. Capacity markets shall be and regulatory framework for nuclear energy. developed to allow for more generation plants with flexibility to adjust generated output as The government will maximize utilization of needed to compensate for the intermittency of indigenous energy resources. To maximize the renewable sources. Electricity generated from country’s existing indigenous energy sources sources such as solar, wind, tidal, and wave and enhance the promotion and awarding of are intermittent as they are not continuously Petroleum Services (PSCs) in the country, the available due to external factors that cannot government will continue its implementation be controlled. The natural gas industry’s of the PCECP. Moving forward, the government development will encourage investment in will address the challenges of the upstream gas-fired generation plants with quick start sector related to exploration activities in the and shutdown capabilities needed to balance West Philippine Sea.48 Chapter 12 Expand and Upgrade Infrastructure | 291 Enhance the demand side Program will be expanded to cover more management energy-consuming products.49 Own-use and participation in the Interruptible Load Government will lead energy efficiency and Program and Net-Metering program will be conservation efforts. The Energy Efficiency encouraged. and Conservation (EEC) Act will be fully implemented so that energy efficiency will Invest in energy innovation to contribute to improving national productivity respond to increasing demand and at the most reasonable cost. The EEC new markets for clean technology Roadmap and the National Energy Efficiency goods and services and Conservation Plan will be updated and The government shall provide a conducive enhanced to provide the policy and program environment to encourage the private direction on making EEC a way of life for all sector investments in game-changing energy consumers. innovations that will facilitate entry of The government will lead by example through cleaner energy in the market and respond the Government Energy Management to increasing demand. On the supply side, Program, which promotes fuel and electricity the innovative solutions include thermal consumption reduction by 10 percent. In the storage, digitalization of energy systems medium term, a Demand Side Management through the use of ICT (network-connected Circular will be issued on initiatives and devices), and development and deployment technologies that will encourage consumers of energy storage systems. On the demand optimize their energy use. The government side, innovative technologies include smart will collaborate with the energy service meters for real-time monitoring of energy companies and the private sector to assess consumption, and energy-efficient appliances, the implementation of their respective EEC among others. projects. The Philippine Energy Labeling Social Infrastructure Outcome 5: Enhanced support to social development provided Ensure equitable access to health adequate provision of health care services. and educational infrastructure, in LGUs and private providers will work with partnership with the private sector the national government to ensure that the primary care network (barangay health stations Develop health infrastructure guided by the and primary health care facilities), hospitals, PHFDP 2020–2040. In line with the Universal standalone or specialized facilities, and Health Care Act, a health care provider network other ancillary facilities (i.e., private medical will be established in every province or highly outpatient clinics, infirmaries, birthing homes, urbanized city to ensure comprehensive and dental clinics), whether publicly or privately 292 | Philippine Development Plan 2023-2028 owned, are functionally integrated within the by location. Procurement by lot or package health care provider network. will be pursued, as applicable, to encourage more bid participants. A comprehensive needs assessment of critical health facilities involved in service delivery Adopt modern learning spaces. The need to networks will be regularly conducted. The transform the education system to address assessment results will form part of the the enduring education crisis in the country basis for determining which facilities will be brings forth the need to modernize learning constructed upgraded, or expanded under spaces and ensure adequate, safe, and resilient the Health Facilities Enhancement Program facilities for students. As such, classrooms (HFEP). National government support for shortages will be addressed, while adhering health infrastructure will be guided by the to ideal classroom size to maintain safety National Allocation Framework, which gives and health protocols and ensure optimal priority to low-capacity and high-gap areas. learning environment. To ensure equitable access to quality and In all schools, universal access to basic utilities affordable health care goods and services, such as electricity, internet and water supply proposed interventions will prioritize GIDAs, will be pursued. Provision of basic facilities, marginalized populations, and indigenous including water, sanitation, and hygiene people communities. Multisectoral facilities, libraries, and science laboratories partnerships will also be pursued to deliver will be ensured. Learning spaces will be telemedicine, remote health care services, designed, configured, and equipped to emulate emergency medical service through the classroom of the future.50 Government ambulance and patient transport services, allocation for education spending will be and other innovations for health. The national prioritized while aid and resources from the government will issue guidance regarding private sector, non-government organizations, appropriate financing for such services to and civil society organizations will be sought. reach more underserved and unserved areas with timely healthcare. Improve resiliency to support health and educational outcomes Issues in the implementation of the In cooperation with the national government Basic Education Facilities Fund will be and private stakeholders, LGUs will identify addressed. The Department of Education locations within their jurisdiction for health (DepEd), in coordination with LGUs, will facilities, school buildings and evacuation improve the identification of classroom centers taking into consideration not only gaps at the local level to better inform the accessibility and demand, but also long-term planning and programming, and facilitate resilience to natural and anthropogenic the implementation by DPWH. DPWH will hazards and risks, including those associated revisit the uniform pricing and specifications with climate change. for school buildings to account for possible variances in prices and technical requirements Chapter 12 Expand and Upgrade Infrastructure | 293 National and local government funding, Explore technology options and financing coupled with multi-sectoral partnerships, schemes for SWM based on updated LGU will be pursued to adequately provide for the waste data. Results of scientific research and construction, retrofitting, and repair of health development, and of demonstration projects facilities and schools; to better withstand shall guide the promotion and adoption of the impact of hazards and calamities; and to low-carbon (See Chapter 15), new modern, minimize disruption of services or classes. and innovative technologies, including In every LGU there will be permanent WtE. A menu of technology options and disaster-resilient evacuation centers, equipped financing schemes for the implementation with adequate Gender Equality, Disability and of SWM projects will be provided, taking Social Inclusion (GEDSI)-responsive basic into consideration the composition of waste facilities constructed for families displaced per source, the availability of suitable sites, during emergencies. and greenhouse gas emissions avoidance and reduction targets under the country’s Health system structures that contribute to the Nationally Determined Contribution (NDC) ability to prepare for and respond to diseases (See Chapter 15). Alongside these, waste of public health concern will be established analysis and characterization studies will be and/or strengthened. Among the top priority regularly conducted. structures are the proposed Virology and Vaccine Institute of the Philippines, Center Supporting SWM programs will be for Disease Prevention and Control, and the intensified. Capacity-building programs Philippine Public Health Laboratory System. will be undertaken to develop the technical capacities of LGUs to undertake waste Pursue optimal solid waste analysis and characterization studies and management solutions assess technical and financial options for Facilitate clustering of LGUs to take implementing SWM projects. Information, advantage of economies of scale. The education, and communication campaigns Department of Environment and Natural will be aggressively conducted to promote Resources will assist the LGUs in consolidating greater waste diversion, thus, optimizing the their efforts, services, and resources for the use of disposal sites and enhancing willingness purpose of delivering common facilities to pay for SWM services. for waste management to take advantage of economies of scale. This will alleviate their budget burden for capital-intensive projects and enhance the financial viability of these projects, thus making them attractive to private investors. 294 | Philippine Development Plan 2023-2028 Legislative Agenda Table 12.2 presents priority bills of the 19th Congress during the Plan period to expand and upgrade infrastructure. Table 12.2 Legislative Agenda to Expand and Upgrade Infrastructure RESPONSIBLE LEGISLATIVE AGENDA RATIONALE/DESCRIPTION AGENCY General Infrastructure Policy Public–Private Partnership This amends the Build–Operate–Transfer (BOT) Law to enhance the principal framework Public-Private (PPP) Act governing PPPs in the Philippines by fostering a more competitive and enabling Partnership Center environment for PPPs, addressing the ambiguities in the existing law, and addressing the (PPPC), National bottlenecks and challenges affecting the PPP program. Economic and Development Authority (NEDA) Amendment of RA No. 10752 This will address difficulties in complying with the law’s strict requirements (such Department of Public [The Right-of-Way Act (ROWA) as valuation, compensation and expropriation problems) and further expedite the Works and Highways implementation of infrastructure projects; to provide clearer, fairer, and simpler terms for (DPWH) ROW acquisition for both property owners and the government. Physical Connectivity National Transport Policy Act This aims to help achieve a safe, secure, efficient, competitive, dependable, integrated, Department of environmentally sustainable, and people-oriented Philippine transportation system by Transportation (DOTr), setting forth policies that will serve as boundary conditions to guide all entities involved Department of Public in the transportation sector in the exercise of their functions, including the creation of Works and Highways metropolitan transit authorities, and clarifying the roles and responsibilities of national and (DPWH) local governments. Magna Carta for Commuters This seeks to address the long-standing plight of Filipinos in public transportation by DOTr laying down the rights of the commuting public; promoting an efficient, safe, convenient, accessible, and inclusive public transportation system; and setting key performance indicators and service standards for commuters. Enactment of a law This aims to shift the role of bicycles and other forms of non-motorized and active DOTr institutionalizing the use of transportation, from being an “alternative mode” toward an institutionalized mode of bicycles and other active transport that is integrated in the transportation network of the country. This will be done and sustainable modes of by providing the necessary infrastructure and support services, establishing safety and transportation, including design standards for universally accessible and safe pathways and green open spaces, updating standards for and increasing public awareness on road safety and road sharing among motorists, accessible and safe pathways, cyclists, and pedestrians. and green open spaces Rationalizing the mandates of This seeks to separate the regulator and operations functions of existing government DOTr transport agencies entities; empowering local government units to assume greater responsibility and accountability for transportation and mobility outcomes Creating an independent This will place all transport safety and security matters under a single independent body DOTr body for transport safety and that will, among others, investigate transport accidents and provide transport safety security recommendations, thereby eliminating conflicting and overlapping functions of existing agencies or entities. Digital Connectivity National Broadband Act The bill proposes to institutionalize the National Broadband Program, public safety and DICT, Department emergency communications, and policies for the use of other passive infrastructures— of Energy (DOE), poles, ducts, and dark fiber. Department of National Defense, and DPWH Amendment to the National This seeks to ensure that buildings are capacitated toward achieving universal access DICT, DPWH Building Code to quality, reliable, and secure ICT services by incorporating minimum electronic requirements, i.e., telecommunications facilities, in multi-dwelling buildings, commercial, buildings, government buildings, office buildings, schools, and hospitals, among others. Chapter 12 Expand and Upgrade Infrastructure | 295 RESPONSIBLE LEGISLATIVE AGENDA RATIONALE/DESCRIPTION AGENCY Water Resources Department of Water This will address the weak and fragmented institutional set-up in the sector by NEDA Resources streamlining all water-related functions in the government, and separate resource regulation from economic regulation. Water Regulatory Commission The body will create a business and regulatory environment that is fair, transparent, and NEDA conducive for public and private domestic and foreign investment in water supply and sanitation services by implementing fair, just, and reasonable tariffs, rates, and charges for water supply and sanitation services. Energy Revisit RA 9136 This revisits the policy thereby ensuring its responsiveness to the power industry. DOE, ERC, NEA Electric Power Industry Reform Act) Development and Regulation This aims to consolidate and enhance various executive issuances and policies governing DOE of Philippine Midstream & the natural gas transmission, distribution, and supply. Downstream Natural Gas Drafting of the Comprehensive This will create a nuclear regulatory body for the peaceful uses and application of nuclear DOE, DOST Atomic Energy Regulatory energy Framework Revisiting RA 10531 This is to enhance and streamline the mandate of NEA to ensure quality, reliability, and DOE, NEA [National Electrification security of electric power supply. Administration Reform Act of 2013] Enhance Energy Regulatory This will provide a more streamlined and stronger power regulatory body DOE, ERC Commission (ERC) Amendment of RA 8479 This clarifies the functions of DOE, Department of Trade and Industry (DTI), and Philippine DOE, DTI, PCC, DOF (Downstream Oil Industry Competition Commission (PCC) to ensure regulatory compliance of oil companies Deregulation Act of 1998) Amendment of RA 9367 This aims to provide for time-bound suspension or reduction of the biofuels component in DOE, DILG (Biofuels Act of 2006) the event that oil prices are lower than biofuels. Amendment of PD No. 87 This seeks to revitalize interest and encourage more drilling activity in the country DOE, Department (The Oil Exploration and of Environment and Development Act of 1972) Natural Resources (DENR), DILG, DOF Amendment of PD No. 972 This will revise the income/sharing scheme and incentives granted to industry DOE, DENR, DILG, DOF (The Coal Development Act of stakeholders; to increase the government share in coal operations and define the role of 1976) mining operators in environmental protection. Social Infrastructure Public Schools of the Future in This aims integrate digital technology and innovation into public basic education by, among DepEd Technology (PSOFT) Act others, ensuring adequate investment in digital and technological infrastructure in public schools. Waste-to-Energy Act this bill will provide the necessary regulatory framework for facilities utilizing WtE, the DOE/DENR insufficient safeguards against potential environmental and health concerns surrounding WtE, ambiguities in the roles of government agencies and inefficiencies in carrying out these roles, and lack of investor confidence. Notes: The Open Access in Data Transmission Act is discussed in Chapter 6; the e-Government Act is discussed in Chapter 14. 296 | Philippine Development Plan 2023-2028 Results Matrix Table 12.3 presents the indicators and targets to expand and upgrade infrastructure. Table 12.3 Results Matrix: Expand and Upgrade Infrastructure TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Intermediate Goal: DELIVER SUSTAINABLE, RESILIENT, INTEGRATED, AND MODERNIZED INFRASTRUCTURE FACILITIES AND SERVICES Chapter Outcome: Connectivity, Water Resources, Energy, and Social Infrastructure Improved Public 5.9 5.2 5.1 5.0 5.0 5.4 6.0 6.0 Actual All concerned infrastructure (Q1–Q3 2022) spending implementing spending agencies, increased (% Development share in gross Budget domestic product Coordination [GDP]) a Committee (DBCC)/ Department of Budget and Management (DBM) Physical Connectivity Travel time 3.285 3.272 3.258 3.246 3.233 3.220 3.207 3.207 Agency Metro Manila (decreased) via (2019) reports Development land per key Authority, corridor (hours) 2.38 Department of (2021) Public Works and Highways (DPWH) Percentage 29 30.00 31.00 32.00 33.50 35.00 36.00 36.00 Agency Department of of cycling (2020) reports; Transportation households in Third-party (DOTr) the Philippines independent increased (% of surveys total households) Passenger trips 1.00 11.00 12.00 12.50 13.00 13.50 14.00 14.00 Agency DOTr, Light Rail via rail in Metro (2021) reports Manila Corporation Manila increased (LRMC)/ LRT (% share to total Line 1 Project passenger trips, Management cumulative) Office (PMO) Light Rail Transit Authority, Philippine National Railways (PNR), DOTr-MRT3 Chapter 12 Expand and Upgrade Infrastructure | 297 TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Passengers 35.72 million 158.54 166.47 174.79 183.53 192.71 202.34 202.34 Agency DOTr, transported via air (2021) reports Civil Aviation and sea increased Authority of the (number of Philippines (CAAP), passengers, MIAA, Mactan cumulative) Cebu International Airport Authority (MCIAA), Clark International Airport Corporation (CIAC), Davao International Airport Authority (DIAA), Philippine Ports Authority (PPA), Cebu Port Authority (CPA) Cargo transported 470.30 1,302 1,400 1470 1570 1700 1850 1850 Agency DOTr, via air and sea million reports CAAP, MIAA, MCIAA, increased (2021) CIAC, DIAA, (international and PPA, CPA, Subic domestic) (metric Bay Metropolitan ton, cumulative)​ Authority, economic zones Road traffic 3.85 3.50 3.40 3.30 3.00 2.75 2.50 2.50 Vital Statistics DOTr accident (crash) (2021) Report, rate reduced Philippine (number of Statistics incidents per Authority 100,000 population) - incidents of accidents ​(crash) Digital Connectivity Average download 78.69 100.00 125.00 150.00 200.00 250.00 300.00 300.00 Ookla DICT speed (Mbps) (Sep 2022) Speedtest Global Index Households with 17.70 35.00 40.00 45.00 50.00 55.00 60.00 60.00 ITU internet access (% (2019) total HHs) Affordability of ITU DICT mobile and fixed broadband service (% GNI per capita) Mobile 2.04 2.00 2.00 2.00 < 2.00 < 2.00 < 2.00 < 2.00 broadband (2021) Fixed 11.56 8.50 6.50 5.00 4.00 < 3.00 2.00 2.00 broadband (2021) Water Resources 298 | Philippine Development Plan 2023-2028 TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Safe water 91.60 93.28 94.12 94.96 95.80 96.64 97.48 97.48 Data from MWSS/ supply coverage (2020) surveys WDs/ Rural WS/ (% of families) (e.g., Annual WSP Poverty Indicators Survey [Annual Poverty Indicators Survey(APIS), Family Income and Expenditure Survey [FIES]) Access to basic 93.90 95.12 95.73 96.34 96.95 97.56 98.17 98.17 Data from MWSS/ WDs/ sanitation (2020) surveys (e.g., Rural WS/WSP (% of families) APIS, FIES) Zero open 43.02 80.12 95.01 100 100 100 100 100 DOH Admin DOH, LGUs defecation (ZOD) (as of data (based on % of August municipalities 2022) with ZOD) Energy Proportion of 95.41 95.50 TBD TBD TBD TBD TBD TBD DOE Annual DOE households (2021) Report with access to electricity increased (% of total households) b/ Electricity 804.21 897 945 996 1,051 1,110 1,172 1,172 DOE Annual DOE Consumption (2021) Report per capita increased (kilowatt-hour/ person) Share of 22.40 24 26 28 30 32 33 33 DOE Power DOE renewable (2021) Statistics energy in the power generation mix increased (%) Social Infrastructure Percent of 33.30 35 40 45 50 55 60 60 DOH Admin DOH provinces with (2020) Data adequate hospital bed-to-population ratio increased (%) c/ Percent of 20.90 25 30 35 40 45 50 50 DOH Admin DOH provinces with (2021) Data adequate primary care facilities increased (%) Classroom-to- pupil ratio Chapter 12 Expand and Upgrade Infrastructure | 299 TARGETS RESPONSIBLE BASELINE MEANS OF AGENCY/ INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 EOP VERIFICATION INTER-AGENCY BODY Primary 1:32 1:32 1:32 1:32 1:32 1:32 1:32 1:32 Enhanced DepEd (2021) Basic Education Information System (EBEIS), Department of Education (DepEd) data Junior High 1:44 1:43 1:42 1:41 1:40 1:40 TBD1:40 TBD1:40 EBEIS, DepEd DepEd School (HS) (2021) data Senior HS 1:41 1:41 1:40 1:40 1:40 1:40 1:40 1:40 EBEIS, DepEd DepEd (2021) data Water and sanitation facility to pupil ratio Primary 1:26 1:26 1:26 1:26 1:25 1:25 1:25 1:25 EBEIS, DepEd DepEd (2021) data Junior HS 1:39 1:39 1:38 1:36 1:32 1:30 1:28 1:28 EBEIS, DepEd DepEd (2021) data Senior HS 1:35 1:35 1:34 1:32 1:30 1:28 1:26 1:26 EBEIS, DepEd DepEd (2021) data Proportion of public schools with internet accessed/ Primary 64.20 70 75 80 85 90 98 98 EBEIS, DepEd DepEd (2021) data Junior HS 72.20 75 80 82 88 92 96 96 EBEIS, DepEd DepEd (2021) data Senior HS 67.30 72 80 84 88 92 96 96 EBEIS, DepEd DepEd (2021) data Proportion of 41 43 45 47 49 51 53 53 Department of DENR-EMB/ barangays served (2021) Environment NSWMC by material and Natural recovery facilities Resources (DENR) - Environmental Management Bureau (EMB) data Proportion of 32 35 38 41 44 47 50 50 DENR-EMB DENR cities and/or (2021) data municipalities served by by sanitary landfill facilities TBD = to be determined. a Indicative and subject to updating. Projections pertain to disbursements from national government (NG) infrastructure, infrastructure subsidy and/or equity to government-owned and controlled operations, and transfers to LGUs intended for infrastructure activities. Includes payables from current year’s budget and prior years’ obligations. 2022 figures are programmed (Source: 183rd Minutes of DBCC Meeting, 5 December 2022). b Targets will be provided upon completion of the national electrification Master Plan by March 2023. c Based on the Philippine Health Facility Development Plan 2020–2040, the adequate hospital bed-to-population ratio is 2.7 beds per 1,000 population. The PHFDP 2020–2040 recommends having an average hospital bed-to-population ratio of 2.7 per 1,000 population to meet the present health needs of the population. This gap may be addressed by constructing new hospitals or by expanding the existing hospitals or infirmaries. d Targets are schools located in areas with internet signal. 300 | Philippine Development Plan 2023-2028 1 Department of Transportation (DOTr). Railways Sector. https://dotr.gov.ph/railways-sector.html. 2 DOTr. Annual Report, 2021. Pampanga; data from the Philippine National Railways. 3 DOTr. Railways Sector Data Sets. https://dotr.gov.ph/data-sets/railways-sector-d1.html (accessed day Month year), excluding PNR data. 4 Based on DOTr Ridership Data, excluding PNR data, and assuming a 30-day operation period per month. 5 National Council on Disability Affairs. Batas Pambansa Blg. 344: An Act to Enhance the Mobility of Disabled Persons by Requiring Certain Buildings, Institutions, Establishments and Public Utilities to Install Facilities and Other Devices. https://www.ncda.gov.ph/disability-laws/batas-pambansa/batas-pambansa-blg-344/. 6 In the MRT Incident Monitoring System 2016–2018, there were 30 reported cases of sexual harassment against women, and six against men. 7 Currently, two major policies have been issued for the continued integration of active transport in the transport infrastructure network: DOH–DILG–DPWH–DOTr Joint Administrative Order No. 2020-0001 covering the promotion and safe use of all types of active transport during and after the COVID-19 pandemic; and DPWH Department Order No. 88, Series of 2020, that prescribes standards for bicycle operating spaces and classification of bicycle facilities in our roadways. 8 Based on Social Weather Stations. 2022. Survey on Bicycle Ownership, Usage, and Attitudes of Filipino Household Heads on Cycling as Transportation . ____. 9 World Health Organization. 2022. New WHO Report Highlights Progress, but Cites Need for More Actions to Tackle Road Safety in the Philippines. https://www. who.int/philippines/news/detail/21-12-2018-new-who-report-highlights-progress-but-cites-need-for-more-actions-to-tackle-road-safety-in-the-philippines. 10 The Maritime Route Rationalization and Information System estimates the number of vessels required per route through a route capacity measurement system, and determines the number of possible trips, passenger capacity, and perceived profitability of the fleet in a selected route. 11 Philippine Statistics Authority. 2022. Highlights of the Domestic Trade Statistics in the Philippines First Quarter 2022 (Preliminary). https://psa.gov.ph/sites/ default/files/attachments/itsd/specialrelease/1_Textual%20Analysis%201st%20Qtr%202022%20DomStat%20v2_TSD_ONS-signed.pdf. 12 Fixed broadband download speed. 13 Speedtest Global Index. 2022. Philippines Mean Country Speeds. https://www.speedtest.net/global-index/philippines (accessed day Month year). 14 The United Nations Broadband Commission for Sustainable Development targets to bring the cost of entry-level broadband services below 2 percent of GNI per capita by 2025. See International Telecommunications Union (ITU). ICT Price Baskets (IPB). https://www.itu.int/en/ITU-D/Statistics/Dashboards/Pages/IPB.aspx 15 Department of Information and Communications Technology (DICT), National ICT Household Survey 2019, DICT Website https://dict.gov.ph/ictstatistics/ nicths2019/ (accessed day Month year). 16 ITU. Digital Trends in Asia and the Pacific in 2021: Information and Communication Technology Trends and Developments in the Asia-Pacific Region, 2017–2020. https://www.unapcict.org/sites/default/files/2021-03/Digital%20Trends%20in%20Asia%20Pacific%202021.pdf. 17 See Ravago, M.V. 2023. “The Nature and Causes of High Philippine Electricity Price and Potential Remedies.” Ateneo Department of Economics Working Paper No. 2023-01. Quezon City: Ateneo de Manila University. 18 Ravago, M.V., A. Brucal, J. Roumasset, and J. Punongbayan. 2019. “The Role of Power Prices in Structural Transformation: Evidence from the Philippines.” Journal of Asian Economics 61:20–33. 19 Rodrik, D. 2016. “Premature Deindustrialization.” Journal of Economic Growth 21(1): 1–3. 20 For a more detailed comparison, see Ravago, M.V. 2022. “The Cost Structure of Electricity in the Philippines and Other Asian Countries: A comparative note.” Ateneo Department of Economics Working Paper 2022-02. Quezon City: Ateneo de Manila University.. 21 For a discussion on this paradoxical result, see Ravago, M.V. and J. Roumasset. 2021. “COVID-19, Generation Fuels, and the Energy Transition in the Philippines.” Transactions National Academy of Science & Technology Philippines No. 43. https://transactions.nast.ph/wp-content/uploads/2022/02/2021-Plenary-Paper- Ravago-MV.pdf. 22 See Annex A, which provides the list of projects approved by the Department of Energy (DOE), with FGEN LNG Corporation and Linseed Field Corporation expecting to fill the gap of the depleting Malampaya gas, in Gas Policy and Development Project. 2022. Natural Gas Development Plan. http://gpdp.online/ outputs-reports/technical-assistance-to-government/natural-gas-development-plan/. 23 Chakravorty, U., K. Emerick, and M. V. Ravago. 2016 “Lighting the Last Mile: The Costs and Benefits of Extending Electricity to the Rural Poor.” Resources for the Future Discussion Paper No. 93. https://2012.ateneo.edu/ls/soss/economics/publication/10/08/19/lighting-last-mile-costs-and-benefits-extending-electricity. 24 Fabella, R., D. Bajaro, and J. Gapay. 2018. “Electric Cooperatives: What’s the Score and Where Do We Go from Here?” In M.V Ravago, J. Roumasset, and R. Danao, eds. Powering the Philippine Economy: Electricity Economics and Policy. Quezon City: University of the Philippines Press. 25 Commission on Audit. Annual Audit Report 2021. https://www.coa.gov.ph/reports/annual-audit-reports/aar-ngs/#49-5456-department-of-health-1658122476. 26 National Economic and Development Authority. 2021 Socioeconomic Report. https://neda.gov.ph/wp-content/uploads/2022/07/SER-2021-Chapter-19.pdf 27 Based on a report by DepEd during the Senate Hearing of the Committee on Basic Education held on 19 August 2022. 28 Department of Education (DepEd). 2022. Basic Education Development Plan 2030. Pasig City. https://www.deped.gov.ph/wp-content/uploads/2022/05/DO_ s2022_024.pdf. 29 DepEd. 2022. DepEd Data: Functional Computers and Internet Connectivity SY 2020-2021. https://www.deped.gov.ph/wp-content/uploads/2022/04/DepEd- Databits-Functional-Computers-and-Internet-Connectivity-4.pdf 30 Department of Education (DepEd). 2022. Basic Education Development Plan 2030. Pasig City. https://www.deped.gov.ph/wp-content/uploads/2022/05/DO_ s2022_024.pdf. 31 Based on data obtained from 2021 Philippine Statistical Indicators on Philippine Development, as reported by DENR-EMB/NSWMC. 32 Department of Energy. DOE Department Circular No. DC2022-02-002: “Prescribing the Policies and Programs to Promote and Enhance the Development of Biomass Waste-to-Energy (WtE) Facilities”. Taguig City. 33 World Bank. 2018. Logistics Performance Index. https://lpi.worldbank.org/international/global (accessed day Month year). Washington, DC; TomTom. 2020. Annual Traffic Index. https://www.tomtom.com/traffic-index/ (accessed day Month year). 34 A recent policy issuance accorded preferential dispatch to all qualified and registered generating units utilizing RE in the wholesale electricity spot market. Intermittent or variable RE, which includes wind, solar, run-of-river hydro, and ocean energy, retain their “must dispatch” status. Meanwhile, the option to enjoy “preferential dispatch” is given to those that are not “must dispatch” such as biomass, geothermal, and impounding hydro plants. 35 World Health Organization. 2022. Global Health Expenditure Database. https://apps.who.int/nha/database/ViewData/Indicators/en (accessed 27 December 2022). 36 World Health Organization. 2010. World Health Report, 2010. Geneva. https://www.who.int/publications/i/item/9789241564021. 37 Department of Health. Philippine Health Facility Development Plan 2020–2040. Manila. https://doh.gov.ph/sites/default/files/publications/DOH_PHILIPPINE%20 HEALTH%20FACILITY%20DEVELOPMENT%20PLAN%202020_2040_0.pdf. Chapter 12 Expand and Upgrade Infrastructure | 301 38 DepEd. Various years. Statement of Appropriations, Allotments, Obligations, Disbursements and Balances (SAAODB) 2017–2021. Pasig City. 39 DepEd. Annual Physical Report of Operations/Physical Plan 2018–2021. Pasig City. 40 Navarro, A.M. 2022. School Infrastructure in the Philippines: Where Are We Now and Where Should We Be Heading? Quezon City: Philippine Institute for Development Studies. https://pidswebs.pids.gov.ph/CDN/PUBLICATIONS/pidsdps2210.pdf. 41 The Green Energy Auction in June 2022, which accommodated around 1,966.9 MW of RE capacity that will be online 2023, is seen to contribute to reduction of cost. 42 Department of the Interior and Local Government and Department of Energy. 2020. Joint Memorandum Circular No. 2020-01: Guidelines for LGUs to Facilitate the Implementation of Energy Projects. 30 April. 43 RA 11032 in 2018 and RA 11234 in 2019. 44 This includes off-grid electrification, Renewable Portfolio Standards for off-grid, and omnibus guidelines in enhancing off-grid power development. 45 See details in RA 11697. 46 Ravago, M.V., K. Jandoc, R. Fabella, R. Friaz, and J. Magadia. 2021. “Gauging the Market Potential for Natural Gas among Philippine Manufacturing Firms.” Energy 237: 121563. 47 As cited in the Department of Justice’s opinion, exploration, development, and utilization of inexhaustible renewable energy resources are not subject to the 60:40 onstitutional foreign equity limitation. 48 Currently, PSC holders are required to secure clearance from the National Task Force – West Philippine Sea; and the Security, Justice, and Peace Coordinating Cluster prior to any activity to be conducted in the West Philippine Sea area. 49 These products include: (a) Cleaning and Laundry Appliances; (b) Cooking and Food Processing Appliances; (c) Cooling, Heating and Ventilating Appliances; (d) Grooming and Personal Care Equipment; (e) Information and Communication Technology (ICT) Equipment; and (f) Lighting Products 50 Classroom of the future is an arrangement conducive for teaching and learning (i.e., expanded expertise of teachers and stimulated learning of students) characterized by sufficient, flexible space, and excellent facilities that are resilient and adaptive to climate change, disasters, urban migration and land shortage; and by the adoption of technology and developments in ICT, including online classes, among others. 302 | Philippine Development Plan 2023-2028 13 Ensure Peace and Security and Enhance Administration of Justice CHAPTER 13 Ensure Peace and Security and Enhance Administration of Justice A secure and peaceful community where guns are silenced, food and basic services are sufficient, and community life has normalized and shown signs of progress—this reality is now within the reach of geographically isolated and conflict-affected communities. In pursuing economic transformation, the manifestation of peace and security is a necessary condition in allowing the implementation of development activities that could bring in more and better opportunities for the people. This is attainable if conflict-vulnerable areas are protected and developed, the quality of life is safeguarded from criminality, and communities are safe from natural hazards and other security threats. Likewise, an efficient administration of justice is critical in ensuring sustained economic progress. A stable and accountable justice system, whether traditional or alternative, must inspire trust and confidence among stakeholders through integrity, fairness, and accessibility. The Philippine Development Plan (PDP) 2023–2028 puts forward the premise that a whole-of-government approach with cross-cutting strategies is required in ensuring peace and security. It asserts that economic justice is a pillar of a strong and vibrant economy and requires a sector-based approach anchored on strong coordination among justice sector institutions, agencies, and actors to drive public engagement and trust in the justice system. Subchapter 13.1 Ensure Peace and Security Peace agreements between the government civilian life. In areas not covered by peace and non-state armed groups have stabilized agreements, localized peace engagements security in many areas, normalizing a life free will be intensified, with local government of violence and allowing the implementation units facilitating a whole-of-society approach. of development projects that have opened new Affirmative action on law enforcement and better opportunities for the Filipinos. operations on land and at sea including disaster response will be strengthened. Ongoing Investing in peace and security continues. This modernization of the armed forces and other is realized by completing the commitments security sector agencies will be intensified to of signed peace agreements and in helping protect the country’s territorial integrity. former combatants, their families, and conflict-affected communities to return to Chapter 13 Peace and Security, and Administration of Justice | 307 Assessment and Challenges The signing and implementation of peace demobilized.5 The third phase is currently agreements,1 together with sustained law ongoing, aiming to decommission 91 percent enforcement efforts, have stabilized security of the combatants and their weapons. Likewise, in geographically isolated and conflict- the Camps Transformation Plan 2021–20266 is affected (GICA) communities and resulted in presently implemented, outlining the efforts an increase in economic activities. However, toward a meaningful transformation of camps challenges remain in the implementation of into productive and resilient communities. these agreements and groups with criminal and terrorist activities still exist. At the same Similarly, strategic interventions under the time, natural hazards with devastating effects Bangon Marawi Comprehensive Rehabilitation and the protection of territorial and national and Recovery Program are being implemented interests remain a challenge. in areas affected by the 2017 siege. These include the provision of social and financial In the Bangsamoro Autonomous Region in aid, health care services, educational support, Muslim Mindanao (BARMM), the peace and psychosocial healing for those affected. process is steadily moving forward with the More recently, the Marawi Siege Victims ratification of the Bangsamoro Organic Law Compensation Act of 2022 (Republic Act (Republic Act 11054). The establishment of 11696) was enacted to provide compensation the Bangsamoro Transition Authority in 2019 for properties destroyed during the siege. and its extension to 20252 have laid the critical foundation for a fully functioning autonomous The peace process with non-state armed region. With this, significant progress was groups7 and development interventions for made in terms of the region’s socioeconomic affected communities are in various stages development. In 2021, BARMM registered the of implementation. The demilitarization second-highest economic growth (7.5%) in the of arms and munition of the Cordillera country, a significant improvement from 2016 Bodong Administration-Cordillera Peoples when BARMM posted the lowest growth rate Liberation Army (CBA-CPLA) and the (0.3%) among all regions.3 Poverty incidence Rebolusyonaryong Partido Manggagawang also declined significantly, from 61.8 percent Pilipinas–Revolutionary Proletariat Army– in 2018 to 37.2 percent in 2021.4 Alex Boncayao Brigade (RPMP–RPA–ABB) has been completed8. In the affected areas, The creation of the intergovernmental socioeconomic and livelihood interventions relations bodies between the national continue to be implemented. Meanwhile, the government and the Bangsamoro government people of the Cordillera continue to pursue a addressed and resolved some of the key issues meaningful regional autonomy.9 in the implementation of the Bangsamoro Organic Law. In 2021, the second phase of Moreover, local peace engagements were the decommissioning process was completed, initiated in communities affected by the presence with 12,000 combatants and 2,100 weapons of the Communist Party of the Philippines–New 308 | Philippine Development Plan 2023-2028 People’s Army–National Democratic Front drug problem is critical, and support for the (CPP–NPA–NDF). Communist rebels who professionalization and modernization of the surrendered are provided with socioeconomic PNP and drug enforcement bodies is needed. and legal assistance support through the Enhanced Comprehensive Local Integration Significant progress has also been made Program (E-CLIP) and community development in terms of increasing the capacity of the interventions such as the Payapa at Masaganang security sector to respond to the adverse Pamayanan (PAMANA) Program10 and the impacts of natural hazards and other security Barangay Development Program (BDP).11 threats. The recently enacted Bureau of Fire The PAMANA Program set the foundations Protection Modernization Act (Republic Act for conflict-sensitive development efforts and 11589) is expected to upgrade fire protection empowered partners for peace.12 From 2017 to services in the country. The Bureau of Fire 2021, PAMANA has supported 4,000 projects Protection also initiated the Oplan Ligtas amounting to PHP18 billion.13 Similarly, na Pamayanan to capacitate barangays with PHP16.4 billion was released to support 2,276 systemic and comprehensive methods and socioeconomic14 and infrastructure projects procedures to prevent and respond to fires in 2,228 communist-terrorist group-cleared and other emergency and disaster risks. In barangays under the BDP.15 addition, trainings on public safety were given to Barangay Peacekeeping Action Teams The implementation of a whole-of-government and non-government organization teams in and whole-of-nation approach16 fostered areas. The National Chemical, Biological, a more holistic and cohesive government Radiological, and Nuclear (CBRN) Action response, addressing the interrelated drivers Plan was also formulated but is yet to be of armed conflict in the country. Various cascaded to relevant agencies. clusters and regional and local task forces under the National Task Force to End Local The updating of the National Disaster Risk Communist Armed Conflict (NTF-ELCAC)17 Reduction and Management Plan 2020–2030 were activated. Key strategies in the National outlines actions to ensure coordination Action Plan on Preventing and Countering and efficient logistics operations before and Violent Extremism were also rolled out. during disasters. Many local government units (LGUs) have made significant progress in Similarly, there has been significant reduction disaster preparedness and response, such as in crimes due to intensified law enforcement the adoption of standard operating procedures, efforts.18 The Philippine National Police activation of the Incident Command System, (PNP) Intensified Cleanliness Program was prepositioning of relief, and search and launched to address problems in the service. rescue.19 However, data on population, critical Interventions based on the Philippine facilities, and infrastructure exposed to natural Anti-Illegal Drugs Strategy institutionalized and other security threats are still fragmented a convergence system among government and incomplete. agencies to achieve drug-free communities. A science-health-security based approach on the Chapter 13 Peace and Security, and Administration of Justice | 309 Despite substantial improvements and actions formulation of the National Cybersecurity toward ensuring peace and security, there plan and activation of the National Computer remain challenges that must be addressed. Emergency Response Team and the National In BARMM, all other intergovernmental Cybersecurity Operations Center, a more relations mechanisms still need to be concerted effort in cybersecurity is still needed. operationalized, such as the newly created Bangsamoro Sustainable Development Board Various issues on development and and other intergovernmental arrangements management of the country’s territory and between BARMM, the national government, maritime domain, including enforcement, and relevant LGUs. There are also challenges in regulation, conservation, and security need the process of assisting former combatants in to be tackled. The 2016 Permanent Court their return to civilian life and in the necessary of Arbitration (PCA) Ruling on the West enhancements in the healing, reconciliation, Philippine Sea issue was a clear victory of a and gender mainstreaming components in rules-based international order. However, GICA communities. the Association of Southeast Asian Nations (ASEAN)–China Code of Conduct in the Moreover, the implementation of the peace South China Sea remains unfinished. and development interventions is not fully institutionalized at the regional and local Cross-border and transnational criminal levels. Gaps in efforts geared toward threat activities are still major concerns, given the assessment, programming of responses, porous borders and structural inadequacy community engagement, dismantling of private of relevant state institutions. Current global armed groups, and strategic communication political developments involving inter-state also need to be addressed. and intra-state conflicts further magnify the vulnerability of the country. Hence, support Criminality and threats to public safety, for the modernization of the Armed Forces of including non-traditional security issues, also the Philippines (AFP), Philippine Coast Guard, persist. The rapid growth and sophistication of and other relevant security sector agencies cybercrimes and cyberattacks have increased is critical, underscoring the force structure, the vulnerability of data, people, and structures. capability and materiel upgrade needed to be Hyperconnectivity has also expanded the more effective in undertaking internal and attack surface of cybercriminals. Despite the external security functions. initial efforts of the government, such as the Strategy Framework Ensuring peace and security is an essential development interventions and utilizing foundation of sustainable development. a conflict-sensitive-and-peace-promoting The government will consistently pursue paradigm in government programming. peace by mainstreaming peacebuilding and Toward this end, the gains of the peace 310 | Philippine Development Plan 2023-2028 processes in conflict-affected communities will country’s territorial integrity, maritime be sustained; security and law enforcement rights, and entitlements will be protected operations, cybersecurity, and disaster (See Figure 13.1.1). These outcomes will be response will be strengthened so that the realized through an integrated, transparent, quality of life is safeguarded from criminality; people-centered, and human rights-based protection and safety from natural hazards peace and security policy, supported by and other threats will be ensured; and the relevant cross-cutting strategies. Figure 13.1 Figure 13.1.1 Strategy Framework to Ensure Peace and Security ENSURE PEACE AND SECURITY PROTECTION AND PROTECTION AND QUALITY OF LIFE OF TERRITORIAL INTEGRITY DEVELOPMENT OF SAFETY FROM NATURAL PEOPLE SAFEGUARDED AND SOVEREIGNTY UPHELD CONFLICT-AFFECTED HAZARDS AND OTHER FROM CRIMINALITY AND PROTECTED COMMUNITIES SUSTAINED SECURITY THREATS ENSURED Pursue an integrated, transparent, people-centered, and human rights-based peace and security policy Complete the implementation of all Promote a holistic approach to Improve the capacity and capability Strengthen advocacy on respect for signed peace agreements countering the proliferation of illegal of security forces and LGUs on the rules-based regime in the Ensure the full transition of the and dangerous drugs humanitarian assistance and regional and international BARMM government Strengthen and expand police disaster response and protection community engagements with communities on services to mitigate the impacts of Pursue greater international and Expedite normalization and natural hazards and other reintegration of former combatants crime deterrence, reporting, and regional dialogues and cooperation resolution emergencies and their families and the Develop a modern, credible, and rehabilitation of conflict-affected Strengthen regional and international Protect critical infrastructure, self-reliant defense force communities, including Marawi City partnerships to counter and prevent strategic assets, and natural resources Strengthen the capacity of Strengthen convergence of programs threats from terrorism, violent institutions in security assessment, and ensure that development extremism, radicalization, Strengthen security and resilience operations, and response relative to interventions are conflict-sensitive and transnational crimes, and other of the Philippine cyberspace geopolitical developments peace-promoting non-traditional security threats Advance healing and reconciliation, social cohesion, and transitional justice interventions as key components of peacebuilding Establish appropriate mechanisms to counter threats from terrorism, radicalization, and violent extremism Sustain the compliance of LGUs to good Ensure gender mainstreaming and protection of governance principles and of security institutions Mobilize a broad-based constituency for peace vulnerable groups in conflict-affected communities on human rights and rule of law Strategies Outcome 1: Conflict-affected communities and conflict-vulnerable areas protected and development sustained Complete the implementation of all interventions in RPMP–RPA–ABB–Tabara signed peace agreements Paduano Group and CBA–CPLA communities; (b) supporting initiatives toward Cordillera The government will remain steadfast in autonomy; (c) facilitating the healing and completing the commitments under all reconciliation process in affected communities; signed peace agreements. These include: and (d) providing legal assistance to qualified (a) implementing peace and development individuals. Relative to the Bangsamoro peace Chapter 13 Peace and Security, and Administration of Justice | 311 process, the national government will support in the delivery of socioeconomic support the coordinating committees and security packages for decommissioned combatants, mechanisms on the remaining commitments their families, and communities, and under the 1996 Government of the vulnerable groups (children, elderly, persons Philippines–Moro National Liberation Front with disabilities [PWD], indigenous groups, (MNLF) Final Peace Agreement and support the internally displaced persons) will be made political track and normalization mechanisms more efficient and effective. in the implementation of the Comprehensive Agreement on the Bangsamoro. 20 21 , Moreover, the government will fast-track the rehabilitation and catch-up development of Ensure full transition of the BARMM communities through the implementation Government of various interventions, such as E-CLIP, Support will be extended to the Bangsamoro PAMANA, and BDP. Furthermore, the Transition Authority in institution building, government will complete the delivery of personnel development, and economic social, financial, and socioeconomic assistance management toward an inclusive BARMM necessary for the recovery of affected government. Necessary policy and individuals in Marawi. The government processes will be implemented to ensure will complete infrastructure projects such a smooth BARMM elections in 2025. All as bridges; schools; health centers; markets; intergovernmental relations mechanisms will ports; and the 2,800 permanent housing units be operationalized and strengthened to resolve for Marawi’s most affected to be utilized by remaining and potential issues between the target beneficiaries by 2024. national and the Bangsamoro governments. Strengthen convergence of Expedite normalization and programs, and ensure that reintegration of former combatants development interventions and their families, and the are conflict-sensitive and rehabilitation of conflict-affected peace-promoting communities, including Marawi City To improve conflict-sensitive and Normalization and transformation programs peace-promoting compliance, a monitoring for the Bangsamoro, 22, 23 as supported by and evaluation tool for GICA areas will the Inter-Cabinet Cluster Mechanism on be developed. Project targeting and Normalization (ICCMN),24 will continue. implementation strategies will be further Demobilization of former combatants25 and localized to ensure greater ownership of former violent extremists,26 including the local communities.28 More infrastructure demilitarization of arms and munition, will projects will be rolled out in GICA areas and be completed. The national and Bangsamoro coordination between LGUs’ Peace and Order governments will work closely in neutralizing Councils and Local Development Councils armed threat groups to prevent and curb will be strengthened. Closer cooperation with peace spoilers.27 Systems and procedures domestic and international groups to support 312 | Philippine Development Plan 2023-2028 the various aspects of peace-building will be capacity and response protocols. These facilitated. involve: (a) institutionalizing preventing and countering violent extremism interventions Advance healing and reconciliation, in national and local bodies; (b) sustaining social cohesion, and transitional neutralization efforts against armed threat justice interventions as key groups including law enforcement operations, components of peacebuilding case build-up against high-value targets, legal The legal process, including granting of offensive, intelligence cooperation, military amnesty to qualified individuals, will be operations, and neutralization of illicit financial facilitated. Training and skills improvement sources; (c) institutionalizing local peace will be initiated for social workers and other engagements and transformation program for relevant government agencies to improve former rebels;29 (d) strengthening the LGUs’ capacity in dealing with former combatants peace and order council (POC); (e) sustaining and child soldiers. the efforts of the National Task Force on Disbandment of Private Armed Groups; Establish appropriate mechanisms (f) developing a strategic communication plan to counter threats from terrorism, aimed as social cohesion; and (g) developing radicalization, and violent extremism a de-radicalization program for GICA communities. To neutralize peace spoilers, national and local agencies will strengthen their threat assessment Outcome 2: Quality of life of people safeguarded from criminality Promote a holistic approach in improving capability against traditional and countering the proliferation of illegal non-traditional security threats. and dangerous drugs Strengthen and expand police To ensure that government efforts are engagements with communities on people-centered, holistic, and human crime deterrence, reporting, and rights-based, the government will: (a) use a resolution science-health-security based approach to curbing drug and illegal substance abuse, Law enforcement will be strengthened by alongside restorative interventions for drug expanding police presence in communities and users and their dependents; (b) strengthen establishing more police stations in strategic partnership with stakeholders; and areas. Active partnership with communities (c) strengthen the reward and punishment will be forged. Barangay Peacekeeping Action mechanism in police and drug enforcement Teams, civil society organizations, and institutions. The PNP modernization program community volunteers will be engaged through will continue giving stronger emphasis on community and service-oriented policing professionalization, rights-based policing, and scheme. Public safety and law enforcement Chapter 13 Peace and Security, and Administration of Justice | 313 agencies will converge efforts in patrolling, local cooperation,30 close partnerships internal security, and law enforcement with neighboring states will be sustained operations, both in land and at sea. Systems particularly on matters involving sea for responding to crime and emergencies will patrol, intelligence gathering, information be made more efficient and relevant. Likewise, exchange, rapid bilateral investigations, and neutralization efforts against criminal groups apprehension of criminal elements in the will be sustained, internal cleansing in security porous borders of Southern Philippines31 and institutions will be continued, and executive other critical areas.32 Bilateral and multilateral and legislative oversight over the police and engagements in law enforcement and defense other uniformed personnel will be enforced. against violent extremist groups will be intensified and surveillance and inspection Strengthen regional and international in air transportation33 will be strengthened. partnerships to counter and prevent Similarly, mandates and functions of various threats from terrorism, violent agencies relative to coastal management extremism, radicalization, transnational and maritime security will be reviewed crimes, and other non-traditional and harmonized to ensure efficiency and security threats effectiveness in addressing maritime security Context-specific programs will be initiated threats, while the modernization of the to address radicalization efforts of Philippine Coast Guard and relevant maritime violent extremist groups. As transnational security institutions will be actively pursued. crimes require rigorous national and Outcome 3: Protection and safety from natural hazards and other security threats ensured Improve capacity and capability with CBRN-related concerns. The BFP of security forces and LGUs on Modernization Act will be fully implemented to humanitarian assistance and disaster ensure more responsive fire protection services response and protection services across the country.34 A program to enhance to mitigate the impacts of natural citizen volunteerism in disaster response will hazards and other emergencies be established, with resources and training support and using the AFP Reservists Act35 To manage disaster risks, the National and the National Service Reserve Corps36 as Disaster Risk Reduction and Management platforms. The assessment of the exposure Plan 2020–2030 will be fully and effectively and vulnerabilities of LGUs to disaster risks implemented. The National Chemical, will be expanded. Likewise, capacity building Biological, Radiological, and Nuclear Action on public safety and disaster preparedness Plan will be integrated in national and local will be intensified. Local and international disaster mitigation and response planning, cooperation in humanitarian assistance and together with the established protocols and disaster response operations, joint exercises, standard operating procedures in dealing 314 | Philippine Development Plan 2023-2028 training activities, and information sharing the government will: (a) capacitate CII will be scaled up. sectoral cybersecurity emergency response teams; (b) develop a manual of operations Protect critical infrastructure, and standard protocols on cybersecurity for strategic assets, and natural public and private institutions; (c) ensure resources interoperability and intelligence fusion of Scenario-based planning, preparedness, and security and law enforcement agencies in response mechanisms, as well as the protocols tracking and monitoring online transactions of to protect critical infrastructure and assets, criminal elements, terrorist groups, and illegal will be enhanced. Capacity to respond and drug traders; (d) strengthen capacity and manage maritime-based disasters like oil upgrade technical skills of strategic agencies spills and hazardous and noxious substances on cybersecurity; (e) strengthen cyber defense spills will be improved by mobilizing component in the modernization of the AFP; coastal barangay information networks and (f) forge stronger collaboration with local and Bantay-Dagat volunteer organizations, and international partners; (g) institute minimum by establishing marine pollution centers information security and cybersecurity in strategic locations. Meanwhile, existing standards for CII and government agencies; mechanisms and procedures to protect critical (h) develop cybersecurity curriculum in infrastructure assets will be strengthened37 academic and technical education institutions; through improved coordination and capacity and (i) institute a national policy framework of various government agencies and LGUs in on cybersecurity. In addition, the country critical infrastructures mapping, vulnerability will optimize space science and technology scanning, and threat assessment. applications through the Philippine Space Agency (PhilSA).38 Strengthen security and resilience of the Philippine cyberspace To strengthen security against cyberattacks on critical information infrastructure (CII), Outcome 4: Territorial integrity and sovereignty upheld and protected Strengthen advocacy on respect for of conduct in the South China Sea will be rules-based regime in the regional pursued. A whole-of-nation approach will be and international community adopted in influencing local, regional, and international bodies. Particularly for territorial sovereignty concerns and protection of fisherfolk in territorial waters, the government will advocate the 2016 PCA ruling favoring the Philippine position (See Chapter 5). The completion of the code Chapter 13 Peace and Security, and Administration of Justice | 315 Pursue greater international and and technology development in defense regional dialogues and cooperation science and industry, including space science and technology applications. Monitoring Bilateral, minilateral, and multilateral and information systems and technical diplomatic arrangements in promoting interoperability of maritime security agencies regional security will be strengthened and will be harmonized to ensure a holistic and expanded, while greater people-to-people integrated policy on maritime domain. dialogue among allied states will be promoted. Strengthen capacity of institutions Develop a modern, credible, and in security assessment, operations, self-reliant defense force and response relative to geopolitical Capacity and materiel upgrade will be pursued developments to achieve a minimum deterrence capability The government will increase the capacity of of the AFP. Cooperative joint military and security institutions on maritime security and intelligence exercises with friends and allies will territorial defense, particularly on intelligence be strengthened, while defense cooperation and counterintelligence operations, and arrangements, such as the Mutual Defense intensify international cooperation. Policies Treaty and Visiting Forces Agreements, will relative to the role of the AFP, PNP, and other be maximized by involving other security relevant security agencies in internal security institutions in the training exercises.39 operations will be reviewed. Moreover, the ability of relevant agencies to implement The self-reliant defense posture program rescue and expatriation operations of overseas will be revived and supported to rebuild the Filipinos in difficult and/or dangerous defense industry. Technical cooperation situations will be enhanced. will be pursued in areas of capacity building Cross-Cutting Strategies Cross-cutting strategies will be carried out to to boost the confidence of people toward the support the sectoral outcomes and priorities government and human rights-based security in subchapters 1 and 2.. institutions in strengthening partnership with communities. In addition, better reward Sustain compliance of LGUs to schemes, intensified mainstreaming efforts, good governance principles and of and appropriate penalties on violators will be security institutions on human rights put in place. and rule of law Ensure gender mainstreaming and Good governance and the protection and protection of vulnerable groups in promotion of human rights directly contribute conflict affected communities to peace-building, conflict prevention, and post-conflict recovery. The government will Affirmative action will be done to protect foster efficient, inclusive, and accountable LGUs and promote women and gender rights; and 316 | Philippine Development Plan 2023-2028 safeguard the welfare of vulnerable groups, under the Office of the Presidential Adviser on including children, youth, elderly, persons with Peace, Reconciliation and Unity (OPAPRU) disability, and internally displaced persons, will be pursued to institutionalize and sustain during conflict situations and post-conflict the gains of the peace process. A strategic recovery. communication plan will be carried out to increase public awareness on peace and Mobilize a broad-based constituency security strategies of the government, while an for peace inclusive communication plan will be initiated Peace education will be integrated in formal to entice members of armed threat groups and informal learning platforms, as well as to abandon a life of violence and return to a sustained culture of peace campaigns. The civilian life. establishment of a National Peace Institute Legislative Agenda Table 13.1.1 contains priority bills for the 19th Congress during the Plan period to ensure peace and security. Table 13.1.1. Legislative Agenda to Ensure Peace and Security RESPONSIBLE LEGISLATIVE AGENDA RATIONALE AGENCY National Defense Act This aims to amend Commonwealth Act No. 1 (National Defense Act of 1935) by DND streamlining and further professionalizing the Department of National Defense (DND) and its bureaus. Mandatory Citizens’ Service This aims to unify the three training programs of the current National Service DND Training Act Training Program into a single and comprehensive citizens’ civil and military training in the first two (2) years of a baccalaureate degree program. Self-Reliant Defense Posture Act This aims to strengthen the capabilities of the DND to support the development of DND the defense industry and provide incentives for firms to participate in the effort. Philippine Maritime Zones Act This aims to establish maritime zones and sovereignty jurisdictions where maritime National Coast Watch rights can be exercised against unnecessary and dangerous maneuvers of foreign Council (NCWC) vessels traversing and entering the Philippine territory. Philippine Archipelagic Sea This aims to designate sea lanes and air routes for safe and innocent passage NCWC Lanes Act consistent with the provisions of the United Nations Convention on the Law of the Sea to prevent arbitrary international passage in the Philippine archipelago. Critical Information Infrastructure This aims to protect critical information infrastructure (CIIs) by prescribing minimum DICT Protection Act standards for compliance by government agencies. Cybersecurity Act This aims to strengthen the cybersecurity workforce in the country and strengthen DICT capabilities of the Department of Information and Communications Technology (DICT) by providing it with regulatory authority over CIIs and the cybersecurity industry. Enabling law creating an This will provide an operational basis for future convergence efforts between Office of the Presidential autonomous region in local government units, national government agencies, and stakeholders in the Adviser on Peace, the Cordilleras organization of the Cordillera as an autonomous region. Reconciliation and Unity Chapter 13 Peace and Security, and Administration of Justice | 317 Results Matrix Table 13.1.2 contains year-by-year and end-of-plan indicators and targets that the government seeks to attain within each of the outcomes during the Plan period to ensure peace and security. Table 13.1.2. Results Matrix: Ensure Peace and Security ANNUAL PLAN TARGETS RESPONSIBLE MEANS OF REPORTING INDICATORS BASELINE AGENCY/INTER- ANNUAL EOP VERIFICATION ENTITY AGENCY BODY Subchapter 1 Intermediate Goals: Ensure Peace and Security Outcome 1: Protection and development of conflict-affected and conflict-vulnerable communities sustained Living conditions in conflict- affected and conflict-vulnerable communities improved Percentage of Barangay 822 100% of barangays 100% National Task NTF-ELCAC NTF-ELCAC Development Program beneficiary provided with Force to End Local beneficiary-barangays barangays interventions by Communist Armed provided with socioeconomic (2021) 2023 Conflict (NTF- interventions ELCAC) progress reports 1,406 100% of barangays 100% NTF-ELCAC NTF-ELCAC NTF-ELCAC beneficiary provided with progress reports barangays interventions by (2022) 2024 Percentage of implementation of 43% (2021 100% Office of the OPAPRU OPAPRU peace agreements: Presidential Comprehensive Agreement on Adviser on Peace, the Bangsamoro Reconciliation and Unity (OPAPRU) Report Percentage of implementation 50% (2021) 100% OPAPRU Report OPAPRU OPAPRU of peace agreements: (by 2025) 1996 Final Peace Agreement with the MNLF Percentage of implementation 44% (TPG, 100% OPAPRU Report OPAPRU OPAPRU of peace agreements: 2021) (by 2023) 2000 Peace Agreement with the 0% (NDCG, 100% RPM-P/RPA/ABB 2021) (by 2024) 5-Year Normalization Program 52% (2021) 100% OPAPRU Report OPAPRU OPAPRU with the Government of the (by 2024) Philippines (GPH)–CBA–CPLA Peace Process Outcome 2: Quality of life of people safeguarded from criminality Average monthly index crime rate 2.8 Decreasing Below Crime Incident Philippine National PNP reduced (Sustainable Development (2021) baseline Reporting and Police (PNP) Goal [SDG] indicator)40 decreased target Analysis System (CIRAS) Proportion of families that 89.8% Increasing Above APIS Philippine Statistics PSA feel safe walking alone in the (2020) baseline Authority (PSA) community at night (SDG indicator) target Outcome 3: Protection and safety from hazards and other threats ensured Percentage of cyber incident 80% (2022) Increasing Above Department of DICT DICT reports processed and/or closed baseline Information and and remediated target Communications Technology (DICT) Reports Outcome 4: Territorial integrity and sovereignty upheld and protecteda Maritime domain awareness improved Air domain awareness improved a Indicators for internal monitoring only; not for publication. 318 | Philippine Development Plan 2023-2028 Subchapter 13.2 Enhance Administration of Justice A stable and accountable justice system traditional or alternative, which inspire faith is essential in achieving economic and confidence among stakeholders. transformation. In such a system, the needs and expectations of litigants are reliably managed Efficient justice administration is realized within definite timeframes by impartial actors, when stakeholders from all sectors of society, supported by a technologically adaptive and including the business sector, can resolve disaster-resilient infrastructure. The system legal disputes within the justice system. When entails the provision of cost- and time-effective there is confidence in the justice system, dispute resolution mechanisms, whether more entrepreneurs and business leaders are willing to expand their businesses through investments in assets and people.41 Assessment and Challenges A well-functioning justice system contributes In 2020, the Philippines posted an to creating a healthy business environment.42 improvement in the Doing Business Report of Literature has shown that there is strong the World Bank from 124th to 95th out of 190 correlation between the efficiency of the justice economies,46 It scored high in terms of starting system and commercial and entrepreneurial a business, dealing with construction permits, activity.43 If uncertainties exist in how and protecting minority investors. However, economic disputes are resolved, capitalists it lagged in terms of enforcing contracts and may shy away from investing their money for resolving insolvency, especially among its fear that aside from known business risks, they ASEAN counterparts.47 will also have to allocate resources on costly Nonetheless, the Philippines has enacted and and delayed litigation. amended legislations and regulations toward The overall percentile rank of the Philippines improvement in the justice system. These in cross-country indices remains low. The include Republic Act No. 11576,48 which country failed to meet the 2022 targets in the amended the jurisdictions of the First Level fundamental rights (29.00 vis-à-vis 15.71), civil and Second Level Courts in civil cases; and justice (27.00 vis-à-vis 25.71), and criminal Republic Act No. 10951,49 which updated justice (29.00 vis-à-vis 16.43) sub-indicators the penalties for offenses based on pecuniary under the World Justice Project.44 It likewise value. Moreover, the Implementing Rules failed to meet the 2021 target in rule of and Regulations of the Good Conduct Time law index (50.00 vis-à-vis 26.92) under the Allowance Law and the 2018 New Bail Bond Worldwide Governance Indicators.45 Guide of the Department of Justice (DOJ) have also been implemented. Chapter 13 Peace and Security, and Administration of Justice | 319 The Judiciary has also issued guidelines to the Supreme Court amended the 1997 Rules ensure that the disposition of actions and of Civil Procedure, allowing an electronic proceedings is just, prompt, and inexpensive. mode of filing, service of pleadings, and court Among these are the 2019 Amendments to submissions. The National Justice Information the 1997 Rules of Civil Procedure, the 2019 System (NJIS), which has been implemented Amendments to the 1989 Revised Rules to address case delays particularly in criminal on Evidence, and the Rules on Expedited actions, is also being expanded to include the Procedures in the First Level Courts. Single Carpeta System (Inmate Management Information System) and is laying the Despite these positive developments, groundwork for a unified penology system. several policy reforms and key legislations remain unattained. However, more measures to prevent docket congestion should be put in place. Based on Fragmentation of the criminal justice the 2021 data from the NPS, only 92 percent system remains a challenge. The criminal of all criminal complaints have completed justice system in the Philippines has five preliminary investigation. Meanwhile, the pillars—law enforcement, prosecution, the judiciary has achieved only 93 percent clearance courts, correction, and the community. Its rate. These measures include, among others, administration is shared by the Executive and the nationwide rollout of the Prosecution Case Judiciary branches of government, resulting Management System, streamlining of court in a fragmented system. It has achieved better rules and procedures, strengthening of case coordination through the Justice Sector build-up between the prosecution and the Coordinating Council (JSCC), which has law enforcers, and review of human resource facilitated thoughtful identification of common requirements. Procedures in the justice sector problems and development of sector-based should likewise be automated and digitalized solutions in selected areas called Justice to expedite proceedings and for data accuracy Zones. At present, nine Justice Zones have and consistency. been established in Quezon City, Cebu City, Davao City, Angeles City, Bacolod City, Naga Limited resources weaken the justice sector. City, Calamba City, Balanga City, and Baguio The judiciary has consistently received less City. In these Justice Zones, six information than 1 percent of the annual budget since systems have been operationalized, leading to 2003,51 leading to compounded problems enhanced delivery of swift and fair justice.50 including shortage of courts and insufficient human resources particularly in key justice Backlogs in resolving cases, delays caused sector positions. This has compelled the by inefficient practices, and aging persist. judiciary to designate judges in interim Both the National Prosecution Service (NPS) capacities or pairing them in vacant branches. of the DOJ and the Supreme Court have In the meantime, prosecutors and public adopted reforms in case decongestion and attorneys are assigned to two or more delay. The NPS undertook a decongestion courts at a time despite the existence of laws program that cleared backlogs in the most prescribing the ideal ratio (1:1) of Prosecutor congested prosecution offices. Meanwhile, 320 | Philippine Development Plan 2023-2028 and Public Attorney’s Office (PAO) Lawyer to sector actors generally received good net trust courts. A sector approach, which entails close ratings in the 2021 Justice Needs Survey,52 coordination among justice sector institutions, public perception on the justice sector remains agencies, and actors, is thus necessary to rather negative. As a result, many ordinary determine and maintain the appropriate ratio Filipinos tend to turn to media personalities of justice sector professionals to every court. and other non-legal sources such as online forums and even social media to air their Low public confidence in the justice system grievances and attempt to resolve them. undermines the rule of law. While justice Strategy Framework The strategy framework in Figure 13.2.1 case disposition quality and efficiency and emphasizes the need for coordinated action to improving the plight of persons deprived of enhance justice administration by increasing liberty (PDL) and other vulnerable groups. Figure 13.2.1 Strategy Framework to Enhance Administration of Justice ENHANCE ADMINISTRATION OF JUSTICE ACCESS TO QUALITY FREE OR QUALITY OF LIFE OF PERSONS QUALITY AND EFFICIENCY IN AFFORDABLE LEGAL SERVICES BY DEPRIVED OF LIBERTY (PDL) IMPROVED, DISPOSITION OF CASES IMPROVED AND PRODUCTIVE RE-INTEGRATION OF FILIPINOS IMPROVED PDL IN THE COMMUNITY ENSURED Establish and/or strengthen Promote free legal services access Undertake construction and repair of coordination mechanisms to improve penal facilities sector efficiency and accountability Establish free legal aid public Create a Central Evidence Unit to directory and referral system Establish a unified penology and store and handle evidence in criminal corrections system cases Expand Justice on Wheels Program Operationalize the National Improve human resource allocation in Strengthen victim legal protection Preventive Mechanism the justice sector and assistance Adopt sectoral training for all Expand the e-Dalaw system, stakeholders in commercial disputes Expand access to non-financial bail livelihood and entrepreneurial Advance the use of ADR mechanisms and periodic review of preventive opportunities for PDL, and at all levels imprisonment multi-disciplinary rehabilitation mechanisms Maximize the use of digital technology and build a robust, Identify classes of PDL, who may be efficient, and disaster-resilient ICT qualified for early release, and architecture for the justice sector expand access to parole and Implement the integration of the probation for certain classes of unified crime index uniformity of offenses crime data Streamline the rules on the disposition Operationalize the unified referral specialized and multi-party cases and monitoring system for former PDL Automate consumer complaints handling Provide private sector-led redress mechanisms Chapter 13 Peace and Security, and Administration of Justice | 321 Strategies Outcome 1: Quality and efficiency in disposition of cases improved Establish and/or strengthen cooperation will facilitate case build-up coordination mechanisms to improve through proper collection, preservation, and sector efficiency and accountability presentation of evidence, and will ensure successful prosecution, inclusive of legal and The JSCC will launch a new Justice Zone technical guidance. per quarter within the plan period, while existing Justice Zones expand functions to Create a Central Evidence Unit to include monitoring and assessment of their store and handle evidence in criminal coordination mechanisms, implementation cases of reporting to the JSCC, and sharing of best practices. The DOJ, together with relevant Relevant justice sector agencies will pursue the law enforcement agencies or through the establishment of a Central Evidence Unit as a JSCC, will streamline criminal investigation, main component of the Justice Hubs, which will prosecution, and case management processes, serve as the main repository of all evidence in including those for heinous crimes and criminal cases including storage of electronic illegal drugs. Republic Act 10867,53 or the evidence.54 To address inefficient processing National Bureau of Investigation (NBI) of evidence, an integrated system handled by Reorganization and Modernization Act, sector-representative personnel will be put in will be fully implemented. It will improve place. This system will be used for electronic scientific investigation capabilities, strengthen and physical validation and documentation witness and whistleblower protection, and of evidence coming from various agencies, other special enforcement and protection including from law enforcement, prosecution, programs, to increase investigative and and the courts. prosecutorial effectiveness. Improve human resource allocation Justice Hubs will also be established in selected in the justice sector LGUs. These will serve as a one-stop venue for A JSCC enabling law that adopts a sector- criminal justice and have an infrastructure that based approach will be enacted. This houses courts, prosecutors, public attorneys, legislation will support the creation of the police, and a jail with classified housing for human resource positions that cover justice surrendered or apprehended drug offenders. sector actors in both the Judiciary and the Executive Department and will ensure the Moreover, legislative and policy reforms will required ratio of court to prosecutor to public be pursued to institutionalize cooperation attorney. Sectoral human resource planning between prosecutors and law enforcers such will be strengthened to facilitate timely and as the PNP and NBI, among others. This coordinated creation of new positions and 322 | Philippine Development Plan 2023-2028 appointments, as well as establishment of new Moreover, the Katurungang Pambarangay courts and prosecution offices, among others. or the Barangay Justice System will be Likewise, data analytics will be adopted to explored to consider expansion of its existing enhance the planning process. jurisdiction, which is currently limited to disputes involving parties that reside within Adopt sectoral training for all the same city or municipality or in adjoining stakeholders in commercial disputes cities or municipalities. The exemption of A sector-based approach will be adopted in criminal cases involving offenses punishable the settlement of commercial disputes, which by a maximum penalty of imprisonment include intra-corporate cases, intellectual exceeding one year or a fine over PHP5,000 property cases, cases involving admiralty and from the Katarungang Pambarangay will also maritime laws, financial rehabilitation and be revisited to ensure alignment with Republic liquidation of insolvent debtors, competition Act No. 10951, which adjusted the fines and cases, and cybercrime cases, among others. It the property values on which penalties are will support the conduct of sectoral capacity based under the Revised Penal Code. building and information exchange activities to facilitate case disposition with the least Maximize the use of digital delay, while still providing all relevant technology and build a robust, information required by the courts that are in efficient, and disaster-resilient ICT the control and custody of various agencies in architecture for the justice sector the Executive Department. Robust internet infrastructure will be established within the justice sector to further Advance the use of Alternative support online hearings and case management Dispute Resolution mechanisms systems. The courts will be automated, and at all levels personnel will be upskilled to support a suite of The Supreme Court will revisit the Rules digitalized services, such as video conferencing of Court to include a filtering mechanism hearings. The NJIS will be fully implemented that will require litigants to first exhaust all through the Single Carpeta System as the first available Alternative Dispute Resolution step in information sharing among justice (ADR) mechanisms before judicial recourse. sector actors. It will be expanded eventually Relevant to this, the Office for Alternative to include the Judiciary. To facilitate full Dispute Resolution (OADR) will continue to implementation of the NJIS, the government undertake capacity building, and advocacy will allocate sufficient financial and human and informative programs on different ADR resources for digital transformation initiatives mechanisms, including the Katarungang across the justice sector, which include the Pambarangay. It will update, harmonize, implementation of the Criminal Justice and improve the Philippine legal framework Information Exchange (CjiX) as the platform to strengthen the use of ADR in the public that will bridge the NJIS and the eCourt and private sectors in accordance with System (See Box 13.2.1). international standards. Chapter 13 Peace and Security, and Administration of Justice | 323 In conjunction with the eCourt System made available in the eCourt system portal and NJIS, the justice sector will also adopt and publicly, through the Trial Courts a simplified system of court-bound and Automation Project. court-issued papers, where templates are Box 13.2.1 The National Justice Information System and the Criminal Justice Information Exchange The National Justice Information System (NJIS)— led by the Department of Justice (DOJ) and supported by the Department of Information and Communications Technology, and funded by Congress since 2012—is a project that involves the development and setup of core agency information management systems and inter-agency exchange mechanisms. The NJIS is composed of two discrete clusters: the Law Enforcement Cluster composed of the DOJ National Prosecution Service, Philippine National Police, National Bureau of Investigation, Philippine Drug Enforcement Agency, Dangerous Drugs Board, and Bureau of Immigration; and the Corrections Cluster involving the Bureau of Jail Management and Penology; Bureau of Corrections; Board of Pardons and Parole; and Parole and Probation Administration. The Criminal Justice Information Exchange (CJiX) will be established linking all justice sector agencies. Each agency will develop its own information and communications technology system, which will then be linked to the CJiX. This will build the structure necessary to facilitate interchange of crime-related data pertinent to civil actions and special proceedings, such as fraud in commercial transactions, unfair competition, infringement on intellectual property rights, and infrastructure and land disputes. Agencies at the core of this network are the DOJ, Department of the Interior and Local Government, and the judiciary. A key feature of the CJiX is the harmonization of criminal definitions and procedures, as well as consensus on data capture, storage and retrieval. Implement the integration of the partnership with the DILG and the Supreme unified crime index to improve Court, will conduct capacity building on uniformity of crime data the use of the index database, including its integration to existing data-related processes. A unified crime index database will be utilized in all applicable processes to support the Streamline the rules on the rollout of technology-based case management disposition of specialized and solutions. All forms or logs that list crimes multi-party cases will follow the exact nomenclature of the The rules on land disputes will be streamlined index database that is compliant with the to impose the mandatory consolidation of International Classification of Crimes for causes of action relating to the same real Statistical Purposes, which is the international property, whether for possession, ownership, standard for crime statistics. The DOJ and or damages. The rule on expropriation will University of the Philippines Law Center, in 324 | Philippine Development Plan 2023-2028 also be clarified to ensure that courts are which will serve as a web-based consumer compliant with issuing partial judgments at the complaint portal and automate the entire different stages of an expropriation case. The consumer complaints-handling process of the jurisdiction of the National Commission on government. This will be done by interlinking Indigenous Peoples on claims of indigenous all the member agencies of the Consumer peoples and indigenous cultural communities Network, a collective of government agencies on ancestral domains will also be considered. with consumer protection functions. Furthermore, the Supreme Court will study the need to designate special courts on land Provide private sector-led redress dispute settlement. mechanisms Through the Bagwis Awards Program of the To handle multi-party cases, special rules of DTI, business owners will be encouraged procedure will be crafted. The procedures will to establish consumer welfare desks or an be simplified to give access to those who seek equivalent customer relations office inside redress in mass injury cases, whether through their establishments. These desks or offices will civil or criminal proceedings. provide a mechanism for the speedy resolution Automate consumer complaints of consumer complaints, among other handling parameters that seek to provide immediate redress and at the same time prevent additional The Department of Trade and Industry cases for the court. (DTI) will develop and implement the Philippine Online Dispute Resolution System, Outcome 2: Access to quality free or affordable legal services by Filipinos improved Promote limited law practice will strengthen legal aid initiatives as among its primary objectives for ensuring access The government will fully implement the to justice. In particular, the Supreme Court, Revised Law Student Practice Rule under Rule together with the DOJ, PAO, Integrated Bar 138-A of the Rules of Court for the under- of the Philippines, Philippine Association of privileged to address scarce legal services. Law Schools, and other legal aid clinics will Under said rule, law schools are required to map available legal aid services per locality. establish legal aid clinics and provide accredited Moreover, a database of free legal aid providers law students the opportunity to assist Filipinos will be available online to ensure that law who do not have representation in court. enforcers and detainees have immediate access, Establish free legal aid public pursuant to the United Nations Principles and directory and referral system Guidelines on Access to Legal Aid in Criminal Justice Systems. The Supreme Court, through the Strategic Plan for Judicial Innovations 2022–2027, Chapter 13 Peace and Security, and Administration of Justice | 325 To ensure the expansion of legal services, the and remedies for injustice; (b) improving legal DOJ will also establish the DOJ Action Center protection, awareness, and aid; (c) improving in the regions. These action centers will act on civil society and parliamentary oversight; complaints, requests for legal assistance, and (d) addressing human rights violations queries of walk-in clients. in the justice sector; (e) strengthening linkages between formal and informal Expand the Justice on Wheels Program structures; and (f) monitoring and evaluating The Supreme Court will expand the such interventions. scope of the Justice on Wheels Program Expand access to non-financial bail to address specialized issues like tenurial and periodic review of preventive disputes in agrarian reform, and climate and imprisonment environmental cases. Bringing the courts closer to litigants will ensure speedy resolution The Recognizance Act of 2012 (Republic of disputes in tenurial arrangements and Act 10389)55 will be revisited to expand the environmental actions. application of recognizance. An automated notification system will likewise be Strengthen victim legal protection implemented and integrated in the eCourt and assistance system. This notification system will alert the Access to justice will be made more inclusive accused, who are availing of non-financial especially among marginalized sectors such as bail, of approaching court dates. women, children, PWDs, senior citizens, and The courts will periodically review all criminal indigenous peoples through victim-centered, cases involving preventive imprisonment to child-friendly, and gender-sensitive assistance safeguard the rights of preventively imprisoned mechanisms. Coordination among the DOJ, persons against unreasonable prolonged the PNP, and the Department of Social Welfare detention. The review will be reinforced by and Development will be strengthened to automating the computation of time served by address fragmented mechanisms in existing the detainee, integrating an alert system in the witness protection and victim assistance eCourt system that will prompt the judge on programs. The DOJ will intensify the Victims the release date of the detainee. Compensation Program by pursuing the amendment of Republic Act No. 7309. This amendment will increase the compensation for victims of unjust imprisonment and violent crimes and improve the accessibility and the administration of the program. At the same time, the Commission on Human Rights (CHR) will intensify its efforts to improve access to justice by: (a) empowering the poor and marginalized to seek responses 326 | Philippine Development Plan 2023-2028 Outcome 3: Quality of life of PDL improved, and productive re-integration of PDL in the community ensured Undertake construction and repair of UN CAT and OPCAT require the formation penal facilities of visiting bodies for the prevention of torture and other cruel, inhumane, or degrading The government will expand existing penal treatment of punishment, as well as inspect the facilities and establish new ones to house the treatment and living conditions in detention inmate population adequately. Construction and penal facilities. and repair of penal facilities will adhere to international standards56 to guarantee Expand the e-Dalaw system, dignity and health of detainees, as well as livelihood, and entrepreneurial support effective rehabilitation and social opportunities for PDL, and re-integration of PDL. Likewise, concerned multi-disciplinary rehabilitation agencies will adopt digitalization of jail mechanisms records. Toward this end, the DOJ, the DILG, and the LGUs will also secure the required The e-Dalaw system will be expanded to annual budgetary allocation and seek the afford unhampered access to justice and assistance of the Department of Public enforce social reintegration. Infrastructure to Works and Highways and the DICT to ensure support video conferencing for visitations and uninterrupted project implementation. hearings will be established to reduce possible risks associated with in-person contact, such Establish a unified penology and as smuggling of prohibited items. corrections system To provide livelihood opportunities for PDL, A single agency will be created to manage all the DTI will continue its product development seven national prisons and 926 city, district, and marketing trainings for PDL who are municipal, and provincial jails, as well as skilled in handiwork. These trainings will administer rehabilitation programs for provide PDL opportunities to earn their convicted offenders. This new agency and the keep and for their families. The government courts will work together through information will also provide tax incentives or other sharing to guarantee the timely release of non-monetary incentives and recognition to detainees or convicted offenders. employers and business establishments that will provide capacity-building, livelihood, Operationalize the National or employment, as well as entrepreneurial Preventive Mechanism opportunities to PDL. It will also conduct a Champions in Congress will be tapped to enact study to determine whether expungement of a law that will comply with the UN Convention criminal records adopted in other jurisdictions Against Torture and Other Cruel, Inhuman, is viable to remove the stigma associated or Degrading Treatment or Punishment (UN with incarceration. CAT) and its Optional Protocol (OPCAT). The Chapter 13 Peace and Security, and Administration of Justice | 327 A law that unifies the holistic reintegration (recidivist, habitual delinquent, reiteracion, strategy of formerly incarcerated offenders and quasi-recidivist) will be simplified. will be enacted, involving a multi-disciplinary Distinctions in our penal laws with respect to program that ensures the successful heinous, violent, and non-violent offenders, rehabilitation of convicted offenders. The rather than a simplistic penalty-based program will be directed toward improving classification, will be considered. the offenders’ behaviors, skills, mental health, social functioning, and access to education Operationalize the unified referral and employment. and monitoring system for former PDL Identify classes of PDL who may The government will assess post-incarceration be qualified for early release and outcomes in the form of facilities for psychiatric expand access to parole and support and supportive residential housing, probation for certain classes such as halfway houses. It will give due of offenses consideration to certain classes of offenders. The Revised Penal Code, the Indeterminate For instance, in drug cases, the rehabilitation Sentence Law, and the Probation Law will program will be designed to address underlying be reviewed and revised to allow convicted problems of substance abuse that might lead offenders to avail of the benefits provided by to re-offending. Furthermore, the functions of said laws. The revision, however, will depend the Barangay Anti-Drug Abuse Council will on data from the DOJ regarding which be expanded to include monitoring of former parolees and pardonees are highly unlikely PDL to assist in their complete rehabilitation to be recommitted to prison on account of and reintegration into communities. recidivism. The classes of repeat offenders Legislative Agenda Table 13.2.1 contains priority bills for the 19th Congress during the Plan period to enhance the administration of justice. Table 13.2.1. Legislative Agenda to Enhance Administration of Justice RESPONSIBLE LEGISLATIVE AGENDA RATIONALE/DESCRIPTION AGENCY Justice Sector Coordinating Council (JSCC) This aims to formally recognize the JSCC as a government body, with a DOJ and DILG as JSCC enabling law permanent secretariat, to be charged with institutionalizing coordination principals mechanisms in the justice sector. Justice Sector human resources rationalization This adopts a sector-based approach to creating positions in the justice DOJ, PAO sector by matching the creation of courts with corresponding increases in the number of prosecutors, public attorney’s positions, etc.; and creates more justice sector positions to deal with workload and case congestion. Expand Katarungang Pambarangay This will reassess exemptions of cases that may be brought before DILG the Lupong Tagapamayapa, particularly with respect to residence and thresholds of criminal cases. 328 | Philippine Development Plan 2023-2028 Unified Penology System This aims to unify all penal institutions under one agency, with close BuCor, BJMP, DILG collaboration among courts for the disposition of detention prisoners and convicted offenders. Commission on Human Rights (CHR) as lead This will strengthen the CHR as a National Human Rights Institution, CHR agency for the National Preventive Mechanism compliant with the requirements of the United Nations Paris Principles, United Nations Convention against Torture, and Optional Protocol to the Convention Against Torture. Unified Reintegration Strategy This creates a comprehensive and holistic program for the reintegration of DOJ (lead), BJMP (lead), persons deprived of liberty (PDL) post-incarceration, including employment DTI, DOLE, DSWD opportunities in the public sector and providing incentives for the private sector that will accept PDL as employees. Strengthening and/or modernization of the This will strengthen human resource allocation and improve or promote the PPA Parole and Probation Administration social, moral, and economic well-being of probation and parole workers to address the disproportionate number of probation and parole officers vis-à- vis the applicants, to ensure efficient and effective service delivery. Results Matrix Table 13.2.2 contains year-by-year and end-of-plan indicators and targets that the government seeks to attain within each of the outcomes during the Plan period to enhance the administration of justice. Table 13.2.2. Results Matrix: Enhance Administration of Justice ANNUAL PLAN TARGETS RESPONSIBLE MEANS OF AGENCY/ INDICATORS BASELINE VERIFICATION INTER-AGENCY 2023 2024 2025 2026 2027 2028 BODY Subchapter 2 Intermediate Goal: ENHANCE ADMINISTRATION OF JUSTICE Outcome 1: Quality and efficiency in disposition of cases improved Quality in disposition of cases improved Case completion period 86 87 88 89 90 91 92 Supreme Court SC in judicial dockets (SC) Annual improved a Report Percentage of successful 91.05 91.05 91.07 91.09 91.11 91.13 91.15 Department of DOJ prosecution improved (2021) Justice (DOJ) (convictions vis-à-vis Annual Report acquittal) b Completion rate of cases 40.74 41.24 42.44 43.64 45.24 46.84 48.44 Public Attorney’s PAO handled improved (2021) Office (PAO) Annual Report Efficiency in disposition of cases improved​ Disposition rate for all 39 41 43 45 47 49 51 SC Annual Report SC court levels improved (2021) Percentage of criminal 92.29 92.29 92.30 92.31 92.32 92.33 92.34 DOJ Annual DOJ complaints resolved on (2021) Report preliminary investigation improved Clearance rate of all 93 95 97 99 101 103 105 SC Annual Report SC courts improved (2021) Chapter 13 Peace and Security, and Administration of Justice | 329 ANNUAL PLAN TARGETS RESPONSIBLE MEANS OF AGENCY/ INDICATORS BASELINE VERIFICATION INTER-AGENCY 2023 2024 2025 2026 2027 2028 BODY Settlement rate of Alternative Dispute Resolution (ADR) cases improved Settlement rate 77 79 80 81 82 83 84 Department DILG, Office of ADR cases by (2021) of the Interior for Alternative the Katarungang and Local Dispute Pambarangay (KP) Government Resolution improved (DILG) KP Case (OADR) Statistics Report Settlement rate of ADR 51 53 55 57 59 61 63 SC Annual Report SC cases by the judiciary (2021) improved c Settlement rate of ADR 48.49 50 51 52 53 54 55 OADR OADR cases by the executive (2021) branch improved Outcome 2: Access to quality free or affordable legal services by Filipinos improved Public attorney-to-court 1:2 1:1 1:1 1:1 1:1 1:1 1:1 PAO Annual PAO ratio improved (2021) Report Prosecutor-to-court 45.6 45.6 55 73 82 91 100 DOJ Plantilla DOJ percentage ratio improved Outcome 3: Quality of life of PDL improved, and productive re-integration of PDL in the community ensured Congestion rate in jail and prison facilities reduced Average congestion rate 390 356 341 328 315 302 290 Bureau of Jail BJMP in jail facilities reduced (July 2022) Management and Penology (BJMP) data Congestion rate in prison 304 328 291 302 313 252 262 Bureau of BUCOR facilities reduced (July 2022) Corrections (BUCOR) data Percentage of parolees 98.94 98.94 98.95 98.96 98.98 99 99.02 DOJ Open BUCOR and pardonees not (2021) Government data recommitted into prison due to reoffending or other infractions improved a Percentage of pending cases that are less than five years old from filing. b Prosecution success rate is computed as total conviction/total conviction and acquittal. c This represents the total cases mediated by the judiciary mechanisms, as follows: court-annexed mediation, mobile court-annexed mediation, appellate court mediation, judicial dispute resolution, and tax cases before the Court of Tax Appeals. 330 | Philippine Development Plan 2023-2028 1 These are the 1976 Tripoli Agreement and 1996 Final Peace Agreement with the Moro National Liberation Front (MNLF); the ceasefire agreements with the CBA- CPLA in 1986 and the RPMP–RPA–ABB in 2000; the Framework Agreement on Bangsamoro in 2012; and the Comprehensive Agreement on Bangsamoro in 2014 with the Moro Islamic Liberation Front (MILF). 2 Republic Act No. 11054 resets the first general election in the BARMM and synchronizes it with the 2025 national elections. See 18th Congress. 2021. Republic Act 11593: An Act Resetting the First Regular Elections in the Bangsamoro Autonomous Region in Muslim Mindanao, Amending for the Purpose, Section 13, Article XVI of Republic Act No. 11054, otherwise known as the “Organic Law For The Bangsamoro Autonomous Region In Muslim Mindanao. Signed on Oct 28, 2021. https://www.officialgazette.gov.ph/downloads/2021/10oct/20211028-RA-11593-RRD.pdf. 3 PSA. 2022. All Economies of 17 Regions Recovered from the 2020 Pandemic and Recorded Positive Growths in 2021; CALABARZON was the Fastest Growing Region at 7.6 Percent. April 28, 2022. https://psa.gov.ph/grdp/grdp-id/167338. 4 PSA. Proportion of Poor Filipinos was Recorded at 18.1 Percent in 2021. 15 August 2022. https://psa.gov.ph/poverty-press-releases/nid/167972. 5 Office of the Presidential Adviser on Peace, Reconciliation, and Unity (OPAPRU). 2021. Annual Accomplishment Report 2021: The Philippine Peace Process. https://peace.gov.ph/wp-content/uploads/2022/07/FY-2021-OPAPP-Annual-Report.pdf. 6 Sarmiento, B. S. “Turning MILF Camps into Productive Ecozones: Still Much Work to be Done.” MindaNews. March 3, 2022. https://www.mindanews.com/top- stories/2022/03/turning-milf-camps-into-productive-ecozones-still-much-work-to-be-done/. 7 These include the peace agreements with the RPMP–RPA–ABB, CBA-CPLA, MNLF, and MILF. 8 Office of the Presidential Adviser on the Peace Process (OPAPP). 2019. RPA-ABB Preps Weapons for Disposition. https://peace.gov.ph/2019/09/rpa-abb-preps- weapons-for-disposition/. 9 OPAPP. 2020. Symbolic Destruction of CBA-CPLA Firearms Signify Firm Commitment To Genuine Peace in the Cordillera. https://peace.gov.ph/2020/10/symbolic- destruction-of-cba-cpla-firearms-signify-firm-commitment-to-genuine-peace-in-the-cordillera/. 10 PAMANA is the government’s peace and development convergence program, which extends development interventions to communities in isolated and hard-to- reach conflict-affected and conflict-vulnerable areas. It commenced under the administration of former President Benigno S. Aquino Jr. 11 The Barangay Development Program (BDP) is a peace and development program that aims to provide socioeconomic interventions, e.g., farm to market roads, school buildings, health stations, and livelihood support to barangays cleared from CPP-NPA-NDF. The BDP was instituted under the administration of former President Rodrigo Roa Duterte. See also National Task Force to End Local Communist Armed Conflict (NTF-ELCAC). https://www.ntfelcac.org/bdp. 12 Haim, D., M.C. Fernandez, and M. Cruz. 2019. Evaluation Report: Evaluation of the Payapa at Masaganang Pamayanan (PAMANA) Program. Pasig City: National Economic and Development Authority. https://nep.neda.gov.ph/evaluations/70 (accessed November 20, 2019). 13 OPAPP. 2021. “Philippine Peace Process Milestones Take Center Stage in Pre-SONA Forum.” https://peace.gov.ph/2021/07/philippine-peace-process-milestones- take-center-stage-in-pre-sona-forum/ (accessed July 22, 2021). 14 Support to beneficiaries include scholarships, health insurance, educational assistance, livelihood support. 15 Bolledo, J. 2021. “NTF-ELCAC Releases 16 billion to 812 ’NPA-free‘ Barangays.” Rappler.com. July 13, 2021. https://www.rappler.com/nation/ntf-elcac-fund-npa- free-barangays/. 16 The Whole-of-Nation Initiative was rolled out as an Office of the President Memorandum Circular during President Aquino III’s administration; and expanded by the Duterte Administration under Executive Order 70, s. 2018. See Duterte, R.R. 2018. Executive Order 70, s. 2018. Institutionalizing the Whole-of-Nation Approach in Attaining Inclusive and Sustainable Peace, Creating a National Task Force To End Local Communist Armed Conflict, and Directing the Adoption of a National Peace Framework. December 4, 2018. https://www.officialgazette.gov.ph/2018/12/04/executive-order-no-70-s-2018/. 17 Executive Order 70, s. 2018 institutionalized the whole-of-nation approach to peace and established the NTF-ELCAC. 18 See, for example, Caliwan, C. 2022. “PH Crime Rate Drops by 73.7% in 5 Years Under PRRD: DILG.” Manila: Philippine News Agency. February 22, 2022. https:// www.pna.gov.ph/articles/1168274. 19 Office of Civil Defense. 2022. The Philippines’ Midterm Review of the Implementation of the Sendai Framework for Disaster Risk Reduction 2015–2030 with a Short-term Review of the National Disaster Risk Reduction and Management Plan (2020–2030). Quezon City: National Disaster Risk Reduction and Management Council. https://www.preventionweb.net/media/84407/download. 20 The Government of the Philippines (GPH)–MNLF Jikiri Group Coordinating Committee was created on November 22, 2019, to complete the remaining commitments under the 1996 FPA. See OPAPP. 2019. GPH–MNLF Jikiri Group Coordinating Committee Convenes to Discuss Remaining Commitments Under 1996 FPA. https://peace.gov.ph/2019/12/gph-mnlf-jikiri-group-coordinating-committee-convenes-to-discuss-remaining-commitments-under-1996-fpa/. 21 The MILF normalization coordinating committees include the Joint Normalization Committee, Joint Peace and Security Committee, Coordinating Committee on Cessation of Hostilities-Ad Hoc Joint Action Group. See OPAPP. 2020. Joint GPH–MILF Facility to Ensure Protection of Decommissioned Weapons Completed. https://peace.gov.ph/2020/02/joint-gph-milf-facility-to-ensure-protection-of-decommissioned-weapons-completed/. 22 These communities include those affected by the presence of the Communist Terrorist Group and Local Terrorist Groups. 23 Including the normalization of MILF camps, transformation program of MNLF communities, socioeconomic support to communities, and employment provision for former combatants. 24 The Inter-Cabinet Cluster Mechanism on Normalization and its member agencies are mandated to support the Normalization Program as provided for in E.O. 79, s. 2019. However, its component agencies should also be supporting the parallel transformation program of the MNLF, which will contribute to ensuring the security and stability of the region in preparation for the 2025 regional elections. 25 MILF; MNLF; CBA-CPLA; RPMP–RPA–ABB; and CPP–NPA–NDF. 26 Abu Sayaff Group, Maute Group, Daulah Islamiya, and Bangsamoro Islamic Freedom Fighters. 27 These are armed groups with terroristic goal or self-serving agenda. 28 This strategy is among the recommendations under the 2019 Evaluation of the PAMANA Program. 29 The Transformation Program will be implemented by the LGUs, in coordination with the Armed Forces of the Philippines, to help former rebels and their families to become productive and resilient members of society. 30 Human trafficking and smuggling are major issues in the Philippines. Organized crime networks target vulnerable groups from the United States, Mexico, and the Philippines. See The Global Initiative Against Transnational Organized Crime. 2021. Comparison of Criminalities Between Philippines and United States. https:// ocindex.net/country/philippines/united_states. 31 The porous borders of Southern Philippines, coupled with the debilitated border control in Sulu and Tawi-Tawi are major reasons for its utilization as a trans- shipment route of trafficking of persons and goods. 32 Other areas considered critical are Ilocos Sur, Dagupan City, and Bicol Province. Chapter 13 Peace and Security, and Administration of Justice | 331 33 71% of smuggling and trafficking in the country are transported by air. See Leones, C. and D. Caparas. 2003. Trafficking in Human Beings from the Philippines: A Survey of Government Experts and Law Enforcement Case Files. Quezon City: National Police Commission. https://www.unodc.org/pdf/crime/human_ trafficking/Exec_Summary_NAPOLCOM.pdf. 34 The Bureau of Fire Protection modernization law serve as basis in fire protection services. 35 8th Congress. 1991. Republic Act 7077: Citizen Armed Force or Armed Forces of the Philippines Reservist Act. June 27, 1991. https://www.officialgazette.gov. ph/1991/06/27/republic-act-no-7077/. 36 12th Congress. 2002. Republic Act No. 9163: National Service Training Program (NSTP) Act of 2001. January 23, 2002. https://www.officialgazette.gov. ph/2002/01/23/republic-act-no-9163/. 37 Philippine National Police (PNP). 2020. Memorandum Circular No. 2020-081, PNP Critical Incident Management Operational Procedure. November 2, 2020. https://law.upd.edu.ph/wp-content/uploads/2021/04/PNP-Memorandum-Circular-No-2020-081.pdf. 38 The reconstituted National Cybersecurity Inter-Agency Committee created technical working groups to review and evaluate the Cybersecurity Plan of the Critical Information Infrastructures of the Philippines and to recommend the necessary cybersecurity measures. PhilSA is designated in the Technical Working Group for Space, given that space technology applications are contributory in making cybersecurity infrastructure more resilient to cyber threats. See Duterte, R.R. 2019. Executive Order No. 95, s. 2019, Reorganizing the National Cybersecurity Inter-Agency Committee, Amending Executive Order No. 189 s. 2015 and for Other Purposes. November 15, 2019. https://www.officialgazette.gov.ph/2019/11/15/executive-order-no-95-s-2019/. 39 This includes the Philippine Coast Guard and other maritime law enforcement agencies. 40 Number of crime incidents per month/100,000 population. 41 World Bank. 2004. World Development Report 2005: A Better Investment Climate for Everyone. Washington, DC: World Bank and Oxford University Press. https:// ieg.worldbankgroup.org/sites/default/files/Data/reports/development_effectiveness_0.pdf. 42 World Bank. 2022. Pre-Concept Note: Business Enabling Environment. Washington, DC. https://www.worldbank.org/content/dam/doingBusiness/pdf/BEE-Pre- Concept-Note---Feb-8-2022.pdf. 43 Ippoliti, R., A. Melcarne, and G. B. Ramello. 2015. “Judicial Efficiency and Entrepreneurs’ Expectations on the Reliability of European Legal Systems.” European Journal of Law and Economics 40 (1): 75–94. 44 World Justice Project. 2022. Rule of Law Index, Country: Philippines. https://worldjusticeproject.org/rule-of-law-index/country/2022/Philippines. 45 Worldwide Governance Indicators and The World Bank. 2022. Worldwide Governance Indicators: Philippines. https://info.worldbank.org/governance/wgi/Home/Reports (accessed September 23, 2022). 46 World Bank. 2020. Doing Business 2020. Washington, DC. https://documents1.worldbank.org/curated/en/688761571934946384/pdf/Doing-Business-2020- Comparing-Business-Regulation-in-190-Economies.pdf. 47 It should be noted that data collection for the Doing Business 2020 Report, which gave a 0.0 score for the Philippines in terms of court automation, was completed in May 2019. The report states that it had no mechanism for the electronic filing of the initial complaint or electronic payment of court fees, among others. A year later, the Supreme Court issued Administrative Matter No. 19-10-20-SC, or the 2019 Amendments to the 1997 Rules of Civil Procedure, which specifically addresses the gap by allowing filing of pleadings electronically. In 2021, the Supreme Court launched the Judiciary ePayment system for small claims cases. 48 18th Congress. 2021. Republic Act No. 11576: An Act Further Expanding the Jurisdiction of the Metropolitan Trial Courts, Municipal Trial Courts in Cities, Municipal Trial Courts, and Municipal Circuit Trial Courts, Amending for the Purpose Batas Pambansa Blg. 129, Otherwise Known As “The Judiciary Reorganization Act Of 1980”. July 30, 2021. https://www.officialgazette.gov.ph/2021/07/30/republic-act-no-11576/. 49 17th Congress. 2017. Republic Act No. 10951: An Act Adjusting the Amount or the Value of Property and Damage on which a Penalty is Based, and the Fines Imposed Under the Revised Penal Code, Amending for the Purpose Act No. 3815, Otherwise Known As “The Revised Penal Code” as Amended. August 29, 2017. https://www.officialgazette.gov.ph/2017/08/29/republic-act-no-10951/. 50 These information systems are the E-Warrant System, E-Subpoena System, the Crime Information Reporting and Analysis System, the National Police Clearance System, the Prosecution Case Management System, and the Case Information Database Management System. 51 Batalla, E.V., M. Sta. Romana, and K. Rodrigo. 2018. “The Judiciary Under Threat.” In M. R. Thompson and E.V.C. Batalla, eds., Routledge Handbook of the Contemporary Philippines. New York: Routledge. 52 This survey was conducted by the Social Weather Stations (SWS) and commissioned by the Governance in Justice (GOJUST) II Program. See SWS. Justice Needs Survey 2021: Final Survey Report. 3 December 2021. Quezon City. 53 16th Congress. 2016. Republic Act No. 10867: National Bureau of Investigation Reorganization and Modernization Act. June 23, 2016. https://www.officialgazette. gov.ph/downloads/2016/06jun/20160623-RA-10867-BSA.pdf. 54 Supreme Court of the Philippines. 2001. Administrative Memorandum No. 01-7-01-SC on Rules on Electronic Evidence. July 17, 2001. https://www.doj.gov.ph/ files/rules%20on%20electronic%20evidence.pdf. 55 17th Congress. 2013. Republic Act No. 10389: Recognizance Act of 2012. March 14, 2013. https://www.officialgazette.gov.ph/2013/03/14/republic-act-no-10389/. 56 United Nations Minimum Rules for the Treatment of Prisoners or the Nelson Mandela Rules, and the United Nations Rules for the Treatment of Women Prisoners and Non-custodial Measures for Women Offenders or the Bangkok Rules, among others. 14 Practice Good Governance and Improve Bureaucratic Efficiency CHAPTER 14 Practice Good Governance and Improve Bureaucratic Efficiency Achieving a prosperous, inclusive, and resilient society through economic transformation requires the practice of open, efficient, and accountable governance. In this desired future, citizens, civil society organizations, and the private sector are able to access clear and capable platforms that effectively receive and respond to their agenda at all levels of government. Citizen participation is inclusive, fair, and empowering, allowing Filipinos to transact conveniently with the government through digital technologies and maximizing the benefits of an integrated and productive bureaucracy. Furthermore, public servants are agile, resilient, and accountable; and citizens trust that they will consistently perform at the highest levels of inclusion, productivity, and integrity. This chapter presents the challenges facing good governance and bureaucratic efficiency as well as the outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) participatory governance deepened; (b) public accountability and integrity bolstered; (c) government functions, systems, and mechanisms rationalized and strengthened; and (d) competent, motivated, agile, and resilient public servants supported. Assessment and Challenges The Philippines has made progressive brought about by the Seal of Good Local improvements in its performance in various Governance Act of 2019 or Republic Act No. global governance indices, such as the 11292, have increased transparency among e-Participation Index (EPI),1 Open Budget local government units (LGUs). Index (OBI),2 and the Legatum Prosperity Index (LPI)-Political Accountability Higher rates of civil society organizations (See Figure 14.1). This may be attributed to the 34 (CSO) participation were facilitated by the implementation of the Freedom of Information Fiscal Openness Program of the Department (FOI) policy;5 the National Government Portal of Budget and Management (DBM), the and its subsequent provision of over 200 online Support for Local Governance Program of government services;6 and the expansion of the Department of the Interior and Local open data features of government information.7 Government (DILG), and the commitments Likewise, enhancements in the Philippine made under the Philippine Open Government Government Electronic Procurement System Partnership (PH-OGP). Similarly, the Citizens and the increase in free public Wi-Fi hotspots Participatory Audit (CPA) program of the nationwide8 have also contributed to this Commission on Audit (COA) improved citizen achievement. At the same time, full disclosure participation in the public audit process, and and public financial management reforms Chapter 14 Practice Good Governance and Improve Bureaucratic Efficiency | 337 was recently recognized as the best of its kind Efficient Government Service Delivery in the Asia-Pacific region.9 (EGSD) Law, as well as reforms in public fiscal management policies, enabled the However, the decline in the scores at the country to sustain its LPI scores despite the onset of the coronavirus disease (COVID-19) challenges brought about by the pandemic. pandemic in 2020 highlighted the disruption In fact, the Philippines emerged as one of transparency and participatory mechanisms of only four countries and the only Asian when the government diverted its resources country that demonstrated an adequate level to more urgent service delivery issues. of accountability in its early COVID-19 fiscal Nevertheless, the continuous implementation policy responses.10 of the Ease of Doing Business (EODB) and Figure 14.1 Philippines’ Score in Selected International Governance Indices, 2011–2021 100 75 50 25 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Indicators EPI (*100) OBI CPI LPI: Political accountability LPI: Government integrity LPI: Government effectiveness CPI = Corruption Perceptions Index, EPI = e-Participation Index, LPI = Legatum Prosperity Index, OBI = Open Budget Index. Sources: United Nations United Nations (UN). UN E-Government Knowledgebase: Philippines. UN E-Government Development Database (accessed October 23, 2022). https://publicadministration.un.org/egovkb/en-us/Data/Country-Information/id/134-Philippines; International Budget Partnership (IBP). 2021. “Country Results: Philippines.” Open Budget Survey 2021. https://internationalbudget.org/sites/default/files/country-surveys-pdfs/2021/open-budget-survey-philippines-2021-en. pdf; Transparency International. Corruption Perceptions Index 2021. https://www.transparency.org/en/cpi/2021/index/phl (accessed October 22, 2022); and Legatum Institute Foundation. 2021. The Legatum Prosperity Index—Changes Made Since 2020 Index and Summary of Indicator Details. https://docs.prosperity. com/3716/3643/5991/The_2021_Methodology_-_Part_3_-_Sources_And_Indicators.pdf. The Philippines’ scores in the LPI-Government the Asia-Pacific, may be merely mitigating Integrity11 and Corruption Perceptions Index petty corruption but is unable to curb grand (CPI)12 have declined in recent years. In corruption. Moreover, Freedom House14 2021, Transparency International13 reported observed some instances when certain civil that the Philippines, like other countries in liberties were curtailed, the government’s 338 | Philippine Development Plan 2023-2028 transparency and accountability, and thus, its must also anticipate and mitigate the impacts ability to mitigate corruption are undermined. of the ongoing COVID-19 pandemic and the As government integrity is measured by the transition due to the Mandanas-Garcia16 ruling impartiality, openness, and accountability of implementation, as both expose bottlenecks, its institutions, corruption may in turn, erode silos, and variances in participatory practices trust in the public sector, thereby affecting the and service delivery efficiency across different overall effectiveness of governance. government sectors. Finally, socio-political barriers to inclusion and the meaningful Aside from addressing the obstacles to good participation of marginalized sectors must be governance, the government also needs to strategically addressed, particularly, the gaps resolve structural and multifaceted challenges in implementing the Magna Carta for Women to bureaucratic efficiency. These include (RA 9710), the Indigenous People’s Rights Act uneven resource capacities to digitalize (RA 8371), the mandatory representation of transactions and services at both the national the 14 basic sectors, and inclusionary policies and local levels; issues on data privacy, sharing, espousing government support of CSO coordination, and interoperability; and the participation at all levels of governance. limited capacity of public servants to adapt to accelerated innovations.15 The government Strategy Framework Figure 14.2 presents the strategies to facilitate meaningful inclusion and better quality of good governance and improve bureaucratic participation, more intensified information efficiency that will contribute to the enabling transparency and access, rightsizing of environment of the Philippine Development government functions and structure, and Plan (PDP) 2023–2028. The framework the competence and future readiness of the highlights the strategic pursuit of more government and its public servants. Figure 14.2 Figure 14.2 Strategy Framework to Practice Good Governance and Improve Bureaucratic Efficiency PRACTICE GOOD GOVERNANCE AND IMPROVE BUREAUCRATIC EFFICIENCY PARTICIPATORY PUBLIC ACCOUNTABILITY GOVERNMENT FUNCTIONS, SYSTEMS, COMPETENT, MOTIVATED, AND MECHANISMS RATIONALIZED AGILE, AND RESILIENT PUBLIC GOVERNANCE DEEPENED AND INTEGRITY BOLSTERED AND STRENGTHENED SERVANTS SUPPORTED Ensure sufficient and Enhance public feedback loops Pursue rightsizing and the Guarantee complete and functional participatory spaces whole-of-government approach capable human resources in Intensify transparency in public in re-engineering systems and government Broaden public access to procedures spending information Promote conducive working Strengthen implementation and Accelerate digital transformation environments Improve the quality of participation monitoring of anti-corruption in government laws and programs Increase inclusivity and Raise the productivity accessibility of elections Improve national governance performance of agencies assessments Chapter 14 Practice Good Governance and Improve Bureaucratic Efficiency | 339 Strategies The first two outcomes (participatory instance, a rightsized, productive government governance deepened; public accountability with capable civil servants contributes to and integrity bolstered) provide strategies bolstering public accountability. These for practicing good governance, while strategies also require coherence with other the latter two (government functions, chapter outcomes in the PDP, i.e., promoting systems, and mechanisms rationalized and competition and improving regulatory strengthened; and competent, motivated, efficiency (See Chapter 10), ensuring sound agile, and resilient public servants supported) fiscal management (See Subchapter 11.2), are for improving government efficiency. upgrading infrastructure (See Chapter 12), These strategies complement each other and and enhancing the administration of justice contribute to other outcomes in the focus (See Subchapter 13.2). areas in other chapters of this PDP. For Outcome 1: Participatory governance deepened Deepening participatory governance not only convened according to policy standards. means establishing functional participatory To this end, the DBM will intensify CSOs’ platforms that inform or consult citizens, participation in the national budget preparation but also ensuring that citizens and CSOs process. Meanwhile, the DILG will expand the have concrete roles and significant influence monitoring of the functionality of the local in all stages of public decision-making.17 special bodies (LSB) and People’s Councils; Achieving this outcome will require a and enhance policy guidelines to make CSO deeper understanding of the nuances and accreditation and local networking more priorities of marginalized sectors such inclusive. The PH-OGP Steering Committee as women, children, indigenous peoples, will involve more agencies in the national action overseas Filipinos and overseas Filipino plan, and mainstream PH-OGP mechanisms workers, persons with disabilities, agricultural at the regional and local levels. Agencies will communities, and geographically isolated and ensure that their decision-making bodies with disadvantaged areas. sufficient sectoral representation, particularly from marginalized sectors, are created, Ensure sufficient and functional reviewed for functionality and effectiveness, participatory spaces and enhanced accordingly. To ensure sufficient and functional Broaden public access to information participatory spaces, the government will increase the availability and accessibility Broadening public access to information not of protected spaces for various sectors and merely entails publicizing more information, concerns, while functionality will be secured but also observing open data formats, through platforms that are established and removing barriers to internet connectivity, and 340 | Philippine Development Plan 2023-2028 providing seamless experiences for citizens intensify capacity development interventions who are requesting government information. for CSO members of LSBs. The PH-OGP will Pursuant to this strategy, the government will continue to implement collaborative practices build on the gains of the FOI implementation with CSOs in developing, implementing, and in national agencies, improve on the e-FOI monitoring government programs; and will portal services, and intensify partnerships with strengthen the capacity of national and local LGUs for FOI policies. The Department of CSOs to engage the government effectively. Information and Communications Technology Increase inclusivity and accessibility (DICT) will also enhance the volume and of elections scope of information in Open Data Philippines (online repository of open data from different Drawing from challenges and lessons learned government agencies), and the provision of from conducting national and local elections free public Wi-Fi services nationwide. during the pandemic, the Commission on Elections will expand the use of satellite Improve the quality of participation and special registrations, innovate voting The quality of participation is improved when modalities, intensify voters’ education and it is free from cooptation and tokenism18 and information campaigns outside of the election conducted not for mere compliance with period, and strengthen election laws and policy guidelines.19 To improve the quality procedures to build resilience against health of participation, the DBM and DILG, with and natural hazards. For structural reforms, PH-OGP partner agencies, will mainstream policies on strengthening political parties, the implementation of Participatory regulating political dynasties, and enhancing Governance Metrics 20 for assessing the competition in the political sphere will be quality of participation in LSBs and national jointly pursued by the relevant agencies programs. The DILG will also strengthen and Congress.21 the Council on Good Local Governance and Outcome 2: Public accountability and integrity bolstered To address the complex challenges of building Enhance public feedback loops integrity and preventing corruption, the Effective feedback loops provide precise government will implement strategies that and timely responses to citizens’ demands. will foster higher levels of trust, satisfaction, Thus, enhancing these loops presents and political efficacy among the public. These a transformative potential for social strategies will bolster reporting and redress accountability and improving citizens’ mechanisms; increase the precision and trust and confidence in government. To responsiveness of government agencies and operationalize this strategy, the government programs to public concerns; and improve will ensure the functionality, efficiency, policy integration and coherence among and effectiveness of helplines, hotlines, and concerned national and local units. Chapter 14 Practice Good Governance and Improve Bureaucratic Efficiency | 341 helpdesks outlined in existing laws. At the implementation to other audit sectors. The national level, the monitoring and resolution DILG will intensify monitoring transparency of citizen reports will be improved through practices in LSBs, extending these to the local the EODB and EGSD Acts, the Anti-Red Bids and Awards and Project Monitoring Tape Authority’s (ARTA) Harmonized Client Committees. More joint agency initiatives will Satisfaction Measurement, the Civil Service also help break down barriers to transparency26 Commission’s (CSC) Contact Center ng in data privacy policies. Bayan, and people’s feedback mechanisms required in national agency websites. The Strengthen implementation and DBM will also institute a CSO desk to monitoring of anti-corruption laws receive and respond to CSOs’ budget-related and programs concerns. At the local level, the DILG will Fulfilling the Philippines’ commitment to monitor the functionality and responsiveness the United Nations Convention Against of feedback mechanisms, including the CSO Corruption requires a whole-of-government desks and Barangay Violence Against Women approach. This involves the sectoral helpdesks;22 improve the Citizen Satisfaction capacity assessment of the anti-corruption Index System implementation with CSOs; and infrastructure in the country; strengthening pursue third-party monitoring of state-funded and harmonizing the development, projects. Moreover, digital technologies will implementation, monitoring, and evaluation be used to augment the implementation of of anti-corruption programs and laws; and these mechanisms with due emphasis on developing a dynamic and multi-disciplinary access, inclusion, context-sensitivity, and information technology-enabled, multi-year empowerment of marginalized sectors.23 innovation plan.27 The Office of the Ombudsman, the CSC, and their partner Intensify transparency in public spending agencies and stakeholders will build on Complementary to the strategies for lessons learned from programs such as the broadening access to information, intensifying Integrity Management Program; Integrity, transparency in public spending will help Transparency, and Accountability in Public ensure that health emergencies and natural Service; Statement of Assets, Liabilities, and hazards, such as the COVID-19 pandemic, will Net Worth declaration; and public integrity not disrupt the timely and accessible disclosure campaigns.28 The observance of a code of of public spending information.24 This will be conduct for all government employees and achieved through the full implementation of capacity development in integrity management the EODB and EGSD Act; better integration and corruption controls will be pursued of government units and the observance of to reduce corruption vulnerabilities. The Open Contracting Data Standards25 in the DILG will also enable and monitor the local modernized Philippine Government Electronic Sangguniang Bayan or municipal council’s Procurement System; the timely publication quasi-judicial functions and act on various of budget and financial accountability reports corruption-related complaints filed against through the Transparency Seal among local officials. agencies; and the expansion of COA’s CPA 342 | Philippine Development Plan 2023-2028 Improve national governance roll-out of a National Governance Index29 assessments and intensify the National Evaluation Policy Framework.30 The DILG and the Council of As a cross-cutting strategy, the government Good Local Governance will maintain the will ensure the effective and timely conduct implementation of the Seal of Good Local of governance assessments and improve Governance assessment of LGUs. This will the policy learning environment at all further ensure that the evaluation framework government levels. Monitoring and evaluation reflects the political capacity indicators of of government processes, service delivery, LGUs’ resilience to the COVID-19 pandemic and outcomes enhance transparency and and other risks, as well as service delivery accountability, while policy responses standards, in order to transition national to assessments contribute to improving and local governments effectively to the government efficiency. In this endeavor, the post-Mandanas-Garcia scenario. government will hasten the development and Outcome 3: Government functions, systems, and mechanisms rationalized and strengthened Improving bureaucratic efficiency is judiciary, and other constitutional bodies. To foundational to an enabling environment do this, appropriate diagnostic frameworks, for economic transformation and in upholding economic principles, and strategic facilitating the Philippines’ transition to an reviews of the role, mandates, functions, and upper middle-income country. An efficient structure of government will be employed.34 bureaucracy exercises the best use of its The government will also optimize the resources including operational costs, time, performance of national agencies’ core and human resources (HR),31 while effecting functions, and ensure the effective and efficient coherence,32 rationality, and uncertainty implementation of public services. Precursory reduction to deliver the intended results. to this priority reform, agencies will improve Strategies for this outcome include rightsizing the implementation of complementary and digitalizing government functions, while policies such as the authority of the enhancing productivity. Governance Commission for Government- Owned or -Controlled Corporations Pursue rightsizing and the (GOCCs) to reorganize, streamline, abolish, whole-of-government approach or privatize GOCCs; ARTA’s mainstreaming in re-engineering systems and of the Whole-of-Government Re-engineering procedures Manual;35 and streamlining of audits and The government will enact the National systems development across agencies.36 Government Rightsizing Program33 to implement structural and procedural In addition, the government will facilitate reforms in the executive branch and advocate the strategic delineation of functions, rightsizing among LGUs, the legislature, the structure, and staffing of national agencies Chapter 14 Practice Good Governance and Improve Bureaucratic Efficiency | 343 and LGUs concerning the Supreme Court’s and collections,40 DICT’s E-Government Mandanas-Garcia ruling and Executive Masterplan 2022 on digitalization of frontline Order (EO) No. 138, s. 2021.37 Led by government transactions and administrative the DBM and DILG, concerned national functions,41 DBM’s Budget and Treasury agencies will expedite their respective Management System,42 the Philippine Business transitions into capable policy development Hub,43 DICT’s Integrated Business Permits and oversight bodies that can provide sound and Licensing System with LGUs,44 and the and timely service delivery standards and integration of government services into the capacity development interventions for Philippine Identification System.45 LGUs. The functions of inter-agency and multi-stakeholder bodies and committees that Raise the productivity performance support the transition at the subnational levels of agencies will be streamlined as part of the functions of To pursue this strategy, the government the Regional Development Councils. will strengthen productivity performance frameworks across government sectors and Accelerate digital transformation in levels and translate these into more coherent government capacity development programs and incentive The COVID-19 pandemic response structures. Contributory to this strategy is emphasized the importance of digital the strengthening of the implementation information and services.38 Accordingly, the of the Government Quality Management government will adopt digital technologies Program,46 results-based performance for the optimization and integration of its management system standards, and the services to improve efficiency and rightsize Development Academy of the Philippines’ the government.39 To accelerate digital (DAP) productivity capability development transformation, the government will strengthen programs;47 as well as the adoption of the its legal and institutional framework; adopt Philippine Quality Award performance paperless, cashless, and data-empowered excellence framework. The Government transactions at all levels; and develop civil Quality Management Program assessments, service capacity for implementation. To this Citizen Satisfaction e-Survey,48 and Business end, the government will pass an e-Governance Satisfaction e-Survey49 will contribute law to establish an integrated, interconnected, to the development of broader national and interoperable information, resource- governance assessments. Likewise, guidance sharing, and communications network to and assistance will be pursued in utilizing deliver public services. Building up to the data from the national satisfaction surveys to legislative reform, the government will ensure identify standards and improvement priorities the effective implementation of policies and as well as balancing outside-in and inside-out programs such as the adoption of digital approaches to improve citizen-centered design payments for government disbursements and delivery performance. 344 | Philippine Development Plan 2023-2028 Outcome 4: Competent, motivated, agile, and resilient public servants supported Transformation in government systems and profile of career officials to be more adaptable to mechanisms will not be possible without the the ever-changing times. The CES system will development of public servants’ competence, be strengthened through merit and fitness, and motivation, agility, and resilience. The ability, continuous updating of its program offerings. motivation, and productivity of government Potential and qualified third-level officials personnel are key determinants of government will undergo the four-stage CES eligibility capability.50 This outcome advances the policy examination process, the CES Leadership capacity (micro-level dimensions of analytical, Management and Proficiency Program, and operational, and evaluation capacity) of civil other CES lifelong learning programs for servants. It also accounts for the profound appointment to CES ranks to build up a critical set of skills and competencies identified as mass of CES officers and eligibles. necessary during the COVID-19 pandemic such as digital skills, agility, futures thinking, Learning and development52 (delivered foresight, and innovation competencies. through pandemic-responsive modalities); and awards and incentives53 programs will Guarantee complete and capable support public servants at all stages of their human resources in government careers while advocating for higher levels of employee engagement.54 Contributing to To advance human capital development and the strategy implementation are the CSC’s harmonize capacity-building initiatives among Program to Institutionalize Meritocracy and agency providers,51 the government will adopt Excellence in Human Resource Management55 a purposive and programmatic approach to and the CES system. Legislating the creation developing new competency frameworks for of HR management offices in LGUs will also the public sector. The competency framework be pursued. will involve coherently linking the Public Management Development Program and Promote conducive working the revitalized National Government Career environments Executive Service (CES) Development Program with the CES process to hasten Conducive working environments enable and enhance the quality of senior public qualified, impartial, values-driven, officials and their successors. The competency professional, and ethical civil servants56 who framework will also develop a set of functional are sufficiently supported to be motivated and behavioral competencies essential to being and productive even in challenging scenarios, a qualified regulator and making substantive as what was experienced during the contributions not only to government, but also pandemic. To achieve this, the government to society, as a whole. will institutionalize alternative working arrangements in the public sector.57 This Moreover, the Career Executive Service Board entails establishing clear performance (CESB) will develop the new competency standards for remote functions; strengthening Chapter 14 Practice Good Governance and Improve Bureaucratic Efficiency | 345 capabilities for the effective use of information strengthening mental wellness programs.59 and communications technology (ICT) tools; The CSC will develop a bureaucracy-wide HR providing support for remote work; and Management Information System, shifting improving policies on authorizations, data HR management from transactional to the management, and audit.58 Initiatives will also more proactive strategic through digital or include advocating occupational health and web-based systems. safety, ensuring public service continuity, and Legislative Agenda Table 14.1 contains priority bills for the 19th Congress during the Plan period to practice good governance and improve bureaucratic efficiency. Table 14.1 Legislative Agenda to Practice Good Governance and Improve Bureaucratic Efficiency LEGISLATIVE AGENDA RATIONALE Rightsizing the Government This will implement transformational improvements to streamline the functions, mandates, structure, and staffing of departments and agencies and simplify systems and processes to deliver public goods and services in the most efficient, effective, and economical manner. E-Governancea This will promote the use of information and communications technology in improving government service delivery and providing access to reliable data and information. Budget Modernization This seeks to institutionalize the cash-based budgeting system to strengthen fiscal discipline in the allocation and use of budget resources. It will also promote public participation in the local budgeting process for shared accountability. National Evaluation Policy This will strengthen legal and institutional frameworks for the regular measurement, reporting, and utilization of the results of public policies, programs, and projects toward supporting evidence-based decisions, ensuring program improvement, and promoting transparency and accountability in the government. It also seeks to advance the culture and practice of evaluation in the public sector, emphasizing accountability for results and strengthening government collaboration to institutionalize the National Evaluation Policy Framework. Moreover, the proposed bill will ensure credible and quality evaluations to support the planning, formulation, budgeting, and implementation of development interventions. Freedom of Information The bill will require government agencies to allow the public to review and copy all official information, and to promote meaningful and increased participation in government decision-making and public accountability. This expands the coverage of Executive Order 2, s. 2016 to the entire bureaucracy, and not just the executive branch. Creation of Human Resource and The bill seeks to establish HRM Offices and mandate regular (plantilla) HRM officers in LGUs to develop competent Management (HRM) Offices in local and credible employees at the local level. It amends the Local Government Code’s optional designation of such government units (LGUs) local officers. Recognition of Indigenous People (IP) This will ensure that IP Mandatory Representatives are recognized in local legislative bodies and their capabilities Mandatory Representatives for local legislation are harnessed for more effective representation and promotion of IP rights through policymaking. a This is separate from the E-Government Act, which merely institutionalizes the E-Government Masterplan. Both bills may be harmonized into a single measure as there are overlaps in the proposed bills. 346 | Philippine Development Plan 2023-2028 Results Matrix Table 14.2 contains year-by-year and end-of-plan indicators and targets that the government seeks to attain within each of the outcomes during the Plan period to practice good governance and improve bureaucratic efficiency. Table 14.2 Results Matrix: Practice Good Governance and Improve Bureaucratic Efficiency BASELINE ANNUAL PLAN TARGETS MEANS OF RESPONSIBLE INDICATOR (YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION AGENCY Outcome 1: Participatory governance deepened Percentage of P: 85% P: 87% P: 89% P: 91% P: 93% P: 95% P: 100% Department DILG provinces (P), cities C: 83% C: 83% C: 85% C: 87% C: 89% C: 91% C: 100% of the Interior (C), and municipalities M:74% M: 76% M: 79% M: 82% M: 85% M: 88% M: 91% and Local (M) (PCMs) compliant (2022) Government with Local Development (DILG) Annual Council (LDC) Report functionality standards increased Outcome 2: Public accountability and integrity bolstered Open Budget Index 68 71 N/A 72 N/A 73 73 OBI Report Department (OBI) score improved* (2021) of Budget and Management Outcome 3: Government functions, systems, and mechanisms rationalized and strengthened Percentage of PCMs 21% or 350 Increasing DILG Annual DILG conferred with the PCMs Report Seal of Good Local (2022) Governance increased Number of government 0 21 30 40 40 40 40 Department of DICT agencies/offices (2022) Information and onboarded and Communications contributing to the Technology (DICT) Open Data Philippines Annual Report Portal increased Outcome 4: Competent, motivated, agile, and resilient public servants supported Percentage of Career 45%** 50% 51% 52% 53% 54% 55% CESB Occupancy CESB Executive Service (CES) Report positions occupied by CES Officers and CES eligibles increased * Targets are reflected every other year due to the survey’s frequency. ** As of September 2022. Chapter 14 Practice Good Governance and Improve Bureaucratic Efficiency | 347 1 As a supplementary index to the United Nations E-Government Survey, EPI assesses the use of online services to facilitate the provision of information by governments to citizens (“e-information sharing”), interaction with stakeholders (“e-consultation”), and engagement in decision-making processes (“e-decision- making). See United Nations (UN). UN E-Government Knowledgebase: Philippines. UN E-Government Development Database. https://publicadministration. un.org/egovkb/en-us/Data/Country-Information/id/134-Philippines (accessed October 23, 2022). 2 The OBI score is a component of the Open Budget Survey that assesses public access to central government budget information. See International Budget Partnership (IBP). “Country Results: Philippines.” Open Budget Survey 2021. https://internationalbudget.org/sites/default/files/country-surveys-pdfs/2021/open- budget-survey-philippines-2021-en.pdf. 3 As the LPI is a composite measure of domains of prosperity, the assessment and targets for this chapter only focus on the Governance Pillar under the Inclusive Societies domain. See Legatum Institute Foundation. 2021. The Legatum Prosperity Index— Changes Made Since 2020 Index and Summary Of Indicator Details. Legatum Institute. https://docs.prosperity.com/3716/3643/5991/The_2021_Methodology_-_Part_3_-_Sources_And_Indicators.pdf. 4 Political accountability is the degree to which the public can hold public institutions accountable, considering the degree of political pluralism and other accountability mechanisms. 5 Duterte, R. R. Executive Order No. 02, s. 2016: Operationalizing in the Executive Branch the People’s Constitutional Right to Information and the State Policies to Full Public Disclosure and Transparency in the Public Service and Providing Guidelines therefor. July 23, 2016. https://www.officialgazette.gov.ph/2016/07/23/ executive-order-no-02-s-2016/. 6 Department of Information and Communications Technology (DICT). Full List of e-Services. https://www.gov.ph/services/ (accessed October 23, 2022). 7 This includes the Open Data Portal, Transparency Seal across all government websites, and the Full Disclosure Policy, among others. 8 DICT. About Free Wi-Fi for All. https://dict.gov.ph/freewifi/# (accessed October 22, 2022). 9 During the 2021 OGP Impact Awards, the CPA strategy was selected first place for the Asia Pacific region. See COA. 2021. “COA’s Citizen Participatory Audit (CPA) Strategy Wins First Place in OGP Impact Award.” December 16, 2021. https://www.coa.gov.ph/coas-citizen-participatory-audit-cpa-strategy-wins-first-place-in- ogp-impact-award/. 10 International Budget Partnership. 2021. Managing COVID Funds: The Accountability Gap. https://internationalbudget.org/covid/wp-content/uploads/2021/05/ Report_English-2.pdf. 11 The LPI’s definition of “government integrity” encompasses both the absence of corruption and the degree to which government fosters citizen participation and engagement through open information and transparent processes. 12 The CPI assesses and ranks countries by their perceived levels of public sector corruption, using a scale of 0–100 where 0 = highly corrupt and 100 = very clean. See Transparency International. 2022. Corruption Perceptions Index 2021. https://www.transparency.org/en/cpi/2021/index/phl (accessed October 22, 2022). 13 Transparency International. 2022. CPI 2021 for Asia Pacific: Grand Corruption and Lack of Freedoms Holding Back Progress. https://www.transparency.org/en/ news/cpi-2021-for-asia-pacific-grand-corruption-holding-back-progress (accessed October 22, 2022). 14 Freedom House. 2022. Freedom in the World 2022: Philippines. https://freedomhouse.org/country/philippines/freedom-world/2022 (accessed October 22, 2022). 15 World Bank. 2022. Philippines: Government Efficiency Policy Notes. Washington, DC. 16 The Supreme Court ruling in the Mandanas case (General Register No. 199802, July 3, 2018) significantly expands the tax base for LGUs’ share in national taxes to include not only national internal revenue taxes but also customs duties and fees. 17 International Association for Public Participation (IAP2). IAP2 Public Participation Spectrum. https://iap2.org.au/resources/spectrum/ (accessed October 22, 2022). 18 Arnstein, S. 1969. “A Ladder of Citizen Participation.” Journal of American Planning Association 35 (4): 216–224. https://doi.org/10.1080/01944366908977225 19 Caucus of Development NGO Networks and Alternative Law Groups, CIVICUS, International Center for Not-for-Profit Law, World Movement for Democracy, and Article 19. 2016. Assessment of the Enabling Environment for Civil Society Organizations in the Philippines. https://www.civicus.org/images/EENA_Philippines_ En.pdf. 20 Medina-Guce, C. 2022. Participatory Governance Metrics for the Philippine Open Government Partnership Commitments: Lessons and Recommendations from Pilot Customizations. Manila: United Nations Development Programme and Department of the Interior and Local Government. 21 Mendoza, R., M. Banaag, J. Hiwatig, and M. H. Yusingco. 2020. “Term Limits and Political Dynasties in the Philippines: Unpacking the Links.” Asia-Pacific Social Science Review 20 (4): 88­–99. 22 Ladia, M.A. and N. Parreno. 2021. Philippines: Gender-based Violence Policy and Institutional Mapping Report. Washington, DC: The World Bank. https://thedocs. worldbank.org/en/doc/e1575832e43d4030373f9a616975364f-0070062021/philippines-gender-based-violence-policy-and-institutional-mapping-report. 23 Medina-Guce, C. 2022. “Civic Tech for Social Accountability in Philippine Local Governments.” In Decentralization, Digitalization, and Development: Strengthening Local Governance for Crisis Response, Recovery, Resilience, and the Sustainable Development Goals. Manila: UNDP Philippines. 24 Canares, M. and F. van Scalkwyk. 2021. Inclusive Responses to the COVID-19 Pandemic: The Role of Open Contracting. Hivos. https://stepupconsulting.files. wordpress.com/2021/10/summary-paper.pdf. 25 Open Contracting Data Publication is a country commitment to the OGP. This pertains to the mandatory publication of contracting data (from planning to implementation) in machine-readable formats. See Open Government Partnership. Open Contracting Data Publication (PH0066). https://www. opengovpartnership.org/members/philippines/commitments/PH0066/ 26 Philippine Center for Investigative Journalism (PCIJ). 2018. Public Contracting in the Philippines: Breakthroughs and Barriers. PCIJ, Hivos, and Article19. https:// pcij.org/uploads/5bea32964f0bf-PCIJ_-Open-Contracting-in-Philippines-Report_01102018_b.pdf. 27 17th Congress. Republic Act No. 11293 (Philippine Innovation Act). Manila; and NEDA, DOST, and DTI. 2020. Administrative Order No. 01, s. 2020: Promulgating the Implementing Rules and Regulations of Republic Act No. 11293 Otherwise Known as the Philippine Innovation Act. February 7, 2020. Manila. 28 Campaigns include the OMB’s Campus Integrity Crusaders, Sikhay Laban sa Korupsyon, and Aral at Asal Project (with the University of the Philippines System and the Commission on Higher Education). 29 The Index will serve as the local counterpart of global governance indices, based on the nuances of the Philippine context. 30 NEDA and DBM. 2015. Joint Memorandum Circular No. 2015-01: National Evaluation Policy Framework of the Philippines. July 15, 2015 https://nep.neda.gov. ph/document/NEDA-DBM%20Joint%20Memorandum%20Circular%20No.%202015-01%20-%20National%20Evaluation%20Policy%20Framework%20of%20 the%20Philippines.pdf. 31 Organisation for Economic Co-operation and Development (OECD). Evaluation Criteria. https://www.oecd.org/dac/evaluation/ daccriteriaforevaluatingdevelopmentassistance.htm (accessed October 22, 2022). 348 | Philippine Development Plan 2023-2028 32 Gajduschek, G. 2003. “Bureaucracy: Is It Efficient? Is It Not? Is That The Question?: Uncertainty Reduction: An Ignored Element of Bureaucratic Rationality.” Administration & Society 34 (6): 700–723. 33 DBM. 2022. Briefer on NGRP. Manila. 34 Diokno-Sicat, C.J. 2018. “Economic Principles for Rightsizing Government.” Philippine Institute for Development Studies Discussion Paper Series No. 2018-46. https://pidswebs.pids.gov.ph/CDN/PUBLICATIONS/pidsdps1846.pdf. 35 ARTA. 2021. Memorandum Circular No. 2021-09 Series of 2021: Issuance of the Whole-of-Government Reengineering Manual. June 25, 2021. https://arta.gov.ph/ wp-content/uploads/2021/11/Memorandum-Circular-No.-2021-09-Issuance-of-WOG-Reengineering-Manual.pdf. 36 Such as rightsizing and/or streamlining reviews stipulated in Section 88, General Provisions of the FY 2022 and the Philippine Government Asset Management Policy. See Official Gazette of the Republic of the Philippines. 2022. General Appropriations Act: General Provisions Fiscal Year 2022. Official Gazette 118 (1). https://dbm.gov.ph/wp-content/uploads/GAA/GAA2022/VolumeI/GENPRO.pdf; and DOF, DBM, and NEDA. 2020. Joint Memorandum Circular No. 2020-1: Implementation of a Philippine Government Asset Management Policy. September 24, 2020. https://www.dbm.gov.ph/wp-content/uploads/Issuances/2020/ Joint-Memorandum-Circular/DOF-DBM-NEDA-JOINT-MEMORANDUM-CIRCULAR-NO-2020-1.pdf. 37 Duterte, R.R. Executive Order No. 138, s. 2021: Full Devolution of Certain Functions of the Executive Branch to Local Governments, Creation of a Committee on Devolution, and for Other Purposes. June 1, 2021. https://www.officialgazette.gov.ph/2021/06/01/executive-order-no-138-s-2021/. 38 Tubuga, A., S. Domingo, C.J. Diokno-Sicat, and V. G. Ulep. 2020. “Innovating Governance: Building Resilience against COVID-19 Pandemic and Other Risks.” Philippine Institute for Development Studies Discussion Paper Series No. 2020-23. September 2020. https://pidswebs.pids.gov.ph/CDN/PUBLICATIONS/ pidsdps2023.pdf. 39 World Bank. Philippines: Government Efficiency. 3-8. Washington, DC. 40 Duterte, R.R. 2022. Executive Order No. 170, s. 2022: Adoption of Digital Payments for Government Disbursements and Collections. May 12, 2022. https://www. officialgazette.gov.ph/2022/05/12/executive-order-no-170-s-2022/. 41 DICT. 2019. E-Government Masterplan 2022. Quezon City. https://dict.gov.ph/ictstatistics/wp-content/uploads/2020/03/EGMP-2022.pdf. 42 The Budget and Treasury Management System is a core element of the Integrated Financial Management Information System, which seeks to: (a) facilitate an efficient and secure government financial transactions and (b) strengthen the monitoring and reporting of financial and fiscal data. 43 The Philippine Business Hub – Central Business Portal (https://business.gov.ph/home) serves as a central system to receive applications and capture application data involving business-related transactions. 44 iBPLS is a software that enables LGUs and their constituents to apply and process building permits and occupancy permits electronically. See ARTA. 2020. “ARTA To LGUs: Automate Business and Building Permits Now using DICT’s IBPLS.” ARTA Press Releases. September 15, 2020. https://arta.gov.ph/press-releases/arta-to- lgus-automate-business-and-building-permits-now-using-dicts-ibpls/. 45 Duterte, R.R. 2022. Memorandum Circular No. 95, s. 2022: Directing All Government Agencies, Offices, Instrumentalities, as Well as Local Government Units, to Prepare for the Implementation of the Philippine Identification System and Its Integration into Government Processes, Databases, Systems and Services. February 7, 2022. https://www.officialgazette.gov.ph/2022/02/07/memorandum-circular-no-95-s-2022/. 46 DAP. Government Quality Management Program. http://pdc.dap.edu.ph/index.php/government-quality-management-program/ (accessed October 22, 2022). 47 DAP. Capability Development. https://coe-psp.dap.edu.ph/capability-development (accessed October 22, 2022). 48 DAP. Citizen Satisfaction e-Survey (e-CitSat). http://pdc.dap.edu.ph/index.php/citizen-satisfaction-e-survey-e-citsat/ (accessed October 22, 2022). 49 DAP. Business Satisfaction e-Survey (e-BizSat). http://pdc.dap.edu.ph/index.php/business-satisfaction-e-survey-e-bizsat/ (accessed October 22, 2022). 50 World Bank Group. 2019. Innovating Bureaucracy for a More Capable Government. Washington, DC. https://openknowledge.worldbank.org/handle/10986/31284 (accessed February 12, 2019). 51 Agency providers include the CSC, DAP, and CESB. 52 Includes DAP’s Local Government Executives and Managers Class under the Public Management Development Program, and CESB’s Leadership and Management Proficiency Program. 53 CSC has harmonized the Strategic Performance Management System with the Program Expenditure Classification and the Results-based Performance Management System. 54 OECD. 2021. “The Future of the Public Service: Preparing the Workforce for Change in a Context of Uncertainty.” OECD iLibrary. https://www.oecd-ilibrary.org/ sites/1a9499ff-en/index.html?itemId=/content/component/1a9499ff-en (accessed October 22, 2022). 55 This program aims to elevate public sector HR management to a level of excellence through the assessment, assistance, and awarding processes of HRM Systems, Practices, and Competencies using HRM maturity level indicators that are at par with global HRM standards. 56 OECD. 2017. “Skills for a High Performing Civil Service.” OECD Public Governance Reviews. OECD Publishing. https://www.oecd.org/gov/skills-for-a-high- performing-civil-service-9789264280724-en.htm (accessed October 22, 2022). 57 CSC. 2022. “Flexible Work Arrangements in the Public Sector May Now be Adopted Anytime.” https://csc.gov.ph/csc-approves-flexi-work-for-gov-t-employees (accessed October 22, 2022). 58 DAP. n.d. The Public Sector Amidst the COVID-19 Pandemic: A Case Study on the Adoption of Alternative Working Arrangement. https://coe-psp.dap.edu.ph/ knowledge-products/the-public-sector-amidst-the-covid-19-pandemic-a-case-study-on-the-adoption-of-alternative-working-arrangements/ (accessed October 22, 2022). 59 CSC, Department of Health, and Department of Labor and Employment. 2020. Joint Memorandum Circular No. 1, s. 2020: Occupational Safety and Health (OSH) Standards for the Public Sector. https://oshc.dole.gov.ph/wp-content/uploads/2021/06/JMC-no.1-V2.pdf. 15 Accelerate Climate Action and Strengthen Disaster Resilience CHAPTER 15 Accelerate Climate Action and Strengthen Disaster Resilience By 2028, communities, institutions, and the natural and built environment in the Philippines are more resilient to the impacts of natural hazards and climate change. To realize this goal, the government will strengthen cross-sectoral convergence and coordination and implement a comprehensive risk management approach to reduce intersecting vulnerabilities and address complexities in managing the compounding and cascading risks posed by climate change across different sectors. The government will collaborate with the private sector and international community to scale up sustainable and green investments that propel economic transformation for a prosperous, inclusive, and resilient society. Innovative policies and measures to advance low-carbon development will also be pursued while ensuring just transition and job creation. Rehabilitation and protection of natural resources will be accelerated to sustain the provision of ecosystem goods and services. A green and blue economy will be promoted and developed to optimize their contribution to livelihood and employment generation while improving environmental and social well-being. Lastly, improved governance will underpin the country’s collective effort to ensure long-term climate and disaster resilience. This chapter presents the challenges faced in climate action and strengthening disaster resilience as well as the outcomes to be pursued to address these challenges during the Plan period. These outcomes are: (a) climate and disaster risk resilience of communities and institutions increased, (b) ecosystem resilience enhanced, and (c) low carbon economy transition enabled. Assessment and Challenges Several enabling policies and plans have Framework,1 National Disaster Risk Reduction been adopted to ramp up climate action and and Management Plan (NDRRMP) 2020–2030, strengthen disaster resilience. These include and Guidelines for Mainstreaming Disaster the adoption of a framework and guidelines Risk Reduction (DRR) and Climate Change to mobilize sustainable and green finance, Adaptation (CCA) in the Comprehensive such as the Sustainable Finance Framework Development Plan. Multi-hazard early and Roadmap, and Securities and Exchange warning systems and tools have also been Commission Guidelines on the issuance of established. The government has also adopted Green and Sustainability Bonds. Plans and the roadmaps on Water Security and Natural guidelines have also been formulated to better Capital Accounting and prepared flood risk manage climate and disaster risks, including master plans for major river basins to improve the National Climate Risk Management the state of ecosystems and enhance their Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 353 resilience to the impacts of climate change and The coronavirus disease (COVID-19) natural hazards. Moreover, local government pandemic slowed down environmental and units (LGUs) were able to integrate climate climate action. The pandemic negatively and disaster risk resiliency measures into affected the achievement of targets in the their local plans, through their Local Climate previous Philippine Development Plan Change Action Plans and Local Disaster Risk and other government plans (e.g., NCCAP, Reduction and Management Plans. However, NDRRMP). For instance, land titling and these plans require updating, and the LGUs delineation of municipal waters, which are need more support for their implementation. vital for securing property rights and effective The NDRRMP 2020–2030 also noted that management, slowed down following the the lack of consistency and standardization imposition of mobility restrictions due to of tools for local flood early warning systems COVID-19. The quarantine measures also caused confusion in the operationalization of hampered the government’s ability to assess the disaster management plan, especially at improvements in local capacities and disaster the sub-national and local levels. preparedness. They also resulted in a significant decline in employment from ecotourism and Government budget allocation for climate sustainable resource-based industries. and disaster resilience has been inadequate. The government’s budget for climate change Overall, the progress in environmental and adaptation and mitigation increased from climate action in the last six years has been PHP195 billion in 2017 to PHP289 billion in modest. The implementation of programs 2022. However, its share in the total budget supporting natural resources management declined from 6.99 percent to 5.77 percent and climate actions has shown some progress. in the same period. The monitoring of actual For instance, forest cover increased by expenditures at the agency and LGU levels also 3.03 percent from 2015 to 2020, and the remains inadequate, making it difficult for the management of protected areas generally government to track and assess the progress improved. However, these positive gains in the climate agenda. For the National still fall short in improving the country’s Disaster Risk Reduction and Management overall performance in these sectors. In the Fund (NDRRMF), an annual average of 2022 Environmental Performance Index PHP20 billion was allocated from 2016 to ranking, the Philippines placed 158th out of 2021. However, analysis showed that the 180 countries in environmental sustainability NDRRMF was mainly used for post-disaster ranking, which covers performance indicators activities such as cash assistance, resettlement, on ecosystem vitality (e.g., biodiversity, water and quick response funds of agencies. This resources), environmental health (e.g., air mirrors the expenditure pattern at the local quality, waste management) and climate level, where Local DRRM Funds were highly change. The country’s overall score of 28.9 skewed toward disaster response, recovery points fell below the Asia-Pacific median score and rehabilitation.2 Meanwhile, the 2016 of 35.1.3 The Sixth Assessment Report of the People’s Survival Fund appropriation has not Intergovernmental Panel on Climate Change yet been fully utilized with only six LGUs able concluded that global average temperature to access the fund. would exceed 1.5°C in the 21st century 354 | Philippine Development Plan 2023-2028 under the intermediate, high, and very high disaster risks.5 Between 2011 and 2021, the greenhouse gas (GHG) emission scenarios. country incurred PHP673.30 billion worth With this, more frequent and intense extreme of damage and losses due to tropical cyclones events will continue to cause widespread alone.6 These damage and losses from climate adverse impacts and related losses and damage change are expected to increase under a to nature and people, beyond natural climate business-as-usual scenario, reaching up to variability. This changing global risk landscape 7.6 percent of the country’s gross domestic and the broad range of hazards—current, product by 2030 and 13 percent by 2040.7 emerging, cascading and complex—have Without adequate action, climate change disproportionately impacted less developed could worsen poverty and inequality in terms and developing countries and communities. of access to resources and opportunities. This compels the government to prioritize Historical data revealed that temperature mobilizing domestic resources for adaptation indices across the country (depending on as the priority climate action in the country. elevation) have high spatial variability. However, with the projected increase in In its Nationally Determined Contribution average temperature by the mid-21st century (NDC) submitted to the United Nations (2036–2065)—specifically, 1.9°C under the Framework Convention on Climate Change moderate Representative Concentration in 2021, the Philippines commits to reduce Pathway (RCP) or RCP 4.5 and 2.3°C under and avoid 75 percent of its projected GHG the high (RCP 8.5) emission scenarios—a emissions against the business-as-usual spatially uniform warming trend across the scenario (2020-2030). Of this mitigation country is to be expected, with increasing target, 2.71 percent are unconditional, and magnitude, frequency, and duration. Projected 72.29 percent are conditional on resources changes in precipitation show a general drying to be provided by developed countries trend (reduced rainfall, more dry days), as to implement mitigation actions in the well as the occurrence of localized extreme agriculture, waste, industrial processes and rainfall events. Projections on sea level rise product use, transport, and energy sectors. reveal an increase of about 20 centimeters by However, the plan to operationalize the the end of the 21st century under the RCP NDC policies and measures (PAM) and their 8.5 scenario, which could worsen storm surge corresponding financing, technology, and hazards on coastal communities. Moreover, capacity development are yet to be developed, tropical storms are also expected to increase in as well as the necessary measurement, frequency and intensity.4 reporting, and verification system to track, monitor, and report the progress of NDC The Philippines is one of the most vulnerable implementation. countries to the impacts of climate change, despite its minimal contributions to global As with other developing countries, the GHG emissions at 0.40 percent. In the 2022 Philippines faces substantial challenges in World Risk Index, the Philippines ranked implementing adaptation and risk reduction first among 193 countries with the highest strategies, strengthening community and Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 355 ecosystem resilience, and transitioning to investments hamper the mobilization of green growth pathways. Limited financial significant private sector financing to drive resources and technical capacity of many climate-resilient and low-carbon transition. LGUs to utilize risk information, including In addition, potential investors would need to CCA and DRR assessment tools, hinder them deal with complex regulatory requirements, from effectively implementing local resiliency inconsistent transition standards, and lack of programs. Funds from other sources will need credible risk data. Moreover, the government to supplement LGU funds, even with the has yet to fully account for the value of natural expected increases due to the implementation capital and ecosystem services to better of the Mandanas-Garcia ruling. However, inform its policies and decisions, including in financial risks around climate change CCA and DRR. Strategy Framework The Strategy Framework for climate action The strategies discussed below aim to achieve and disaster resilience responds to economic the following outcomes: (a) climate and disaster transformation that benefits the welfare risk resilience of communities and institutions of Filipino communities, households, and increased; (b) ecosystem resilience enhanced; individuals (See Figure 15.1). In particular, and (c) low carbon economy transition enabled. it adopts a “well-being lens” where efforts on Implementing the specific strategies requires climate change adaptation, and mitigation, decisive and sustained financing, knowledge and DRR contribute to increased income build-up, technology and innovation, strong and job opportunities, improved public institutions, and concerted action among the health, and enhanced knowledge and skills, government and its stakeholders at all levels. among others. At the same time, these These stakeholders include the private sector, actions contribute to enhancing economic, civil society, academe, local communities, and natural, and social capital toward sustaining peoples’ organization. Climate and disaster well-being over time. risk governance will be comprehensive and science- and evidence-based for the effective and efficient delivery of these actions. 356 | Philippine Development Plan 2023-2028 Figure 15.1 Strategy Framework to Accelerate Climate Action and Strengthen Disaster Resilience ENHANCE ADAPTIVE CAPACITY AND RESILIENCE OF COMMUNITIES AND ECOSYSTEMS TO NATURAL HAZARDS AND CLIMATE CHANGE CLIMATE AND DISASTER ECOSYSTEM RESILIENCE LOW CARBON ECONOMY RISK RESILIENCE OF COMMUNITIES AND INSTITUTIONS INCREASED ENHANCED TRANSITION ENABLED Strengthen the capacity of LGUs and communities in Intensify ecosystem protection, rehabilitation, and Implement the Nationally Determined Contribution disaster prevention and preparedness management (NDC) policies and measures Boost multistakeholder partnership in building and Promote and expand natural resource-based Bolster private sector investments in green translating knowledge to climate change adaptation industries and enterprises development and disaster risk reduction Ensure just transition of workers affected by structural changes towards a greener, more sustainable, and low carbon economy Align environment, social, and governance (ESG) measures and investments with local adaptation and risk reduction needs and priorities Expand market opportunities for low carbon technologies and products IMPROVE GOVERNANCE AND INTERSECTIONALITY OF CLIMATE CHANGE AND NATURAL HAZARD RESILIENCE Note: Strategies above the dashed lines require action by government entities, and those below by non-government entities. Strategies The operationalization of the above framework and adaptive approaches will be implemented will require a whole-of-society and all-hazard considering the different levels of climate and approaches where the knowledge and capacity disaster risks. Rehabilitation, protection, and of academic institutions, non-government management of ecosystems will be intensified or civil society organizations, and vulnerable through nature-based solutions and integrated groups are harnessed or enabled by increased approaches, e.g., integrated water resources public investment. This will jumpstart management and ecosystem-based approach. adaptation strategies to mitigate and better Mitigation strategies that deliver adaptation prepare for the increase in the frequency and and environmental co-benefits will be pursued severity of natural hazards with significant to support the country’s climate and disaster negative impacts on communities. Localized resilience-building efforts. Outcome 1: Climate and disaster risk resilience of communities and institutions increased The government will foster the resilience will also require scaling up sustainable of communities and institutions through finance and de-risking climate investments improved public–private–community (See Subchapter 11.1), as well as strengthening engagements, increased public awareness and human and social assets in terms of understanding of risk and vulnerability, and income and jobs (See Chapter 4); health strengthened implementation of National (See Subchapter 2.1); knowledge, skills, and Climate Risk Management Framework. financial literacy (See Subchapters 2.2 and 11.1); Achieving climate and disaster resilience environmental quality (See Subchapter 2.3); Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 357 agriculture (See Chapter 5); infrastructure and sectoral vulnerability and risk assessments (See Chapter 12); and governance that incorporate public health parameters; (See Chapter 14). (b) compiling and disseminating risk data and information including reports on damage Strengthen the capacity of LGUs and and losses through a comprehensive and communities in disaster prevention interoperable climate change and natural and preparedness hazard database and information system; Geographically disaggregated climate data (c) capacitating LGUs to utilize risk information and related information will be updated for developing, implementing, and monitoring and capacity-building programs will be relevant policies and programs; (d) maximizing conducted to better prepare communities the use of end-to-end early warning and for slow and rapid onset events and identify communication systems for preparedness priority interventions. Subsequently, LGUs and prevention measures; and (e) enhancing are expected to update their respective the integration of climate change and DRR Local Climate Change Action Plans and in the education system. These strategies will Local Disaster Risk Reduction Management help LGUs better access available financing Plans. Program convergence budgeting will facilities (e.g., People’s Survival Fund) for also be enhanced to efficiently address the building community resilience. needs of LGUs, especially those that are Align ESG measures and investments highly vulnerable to natural hazards, climate with local adaptation and risk change, and El Nino-Southern Oscillation reduction needs and priorities (ENSO). In addition, investments in disaster preparedness and prevention, such as resilient Private sector partners will be supported infrastructure (e.g., roads, schools, evacuation in aligning their respective ESG8 targets centers, hospitals, water supply and sanitation and investments (e.g., corporate social facilities, and green-grey infrastructure) will responsibility programs) with local priorities be increased to enable communities affected and targets on CCA and DRR to efficiently by disasters, especially women, children, and allocate limited resources toward building other marginalized groups, build forward resilience. The SDG Stakeholders’ Chambers better (See Chapter 12). under the Sub-committee on Sustainable Development Goals of the Development Budget Boost multistakeholder partnership Coordination Committee of the NEDA Board in building and translating knowledge (DBCC SC-SDG) will be utilized as platform to climate change adaptation and for discussing the rationalization of these disaster risk reduction efforts. To enable accounting of contributions to The National Disaster Risk Reduction and broader sustainability goals, the DBCC SC-SDG Management Council (NDRRMC) and will conduct capacity building programs on the Climate Change Commission (CCC) sustainability and/or ESG reporting for the will collaborate with the private sector and members of the SDG Stakeholders’ Chambers academic institutions in (a) conducting local and other stakeholders. 358 | Philippine Development Plan 2023-2028 Outcome 2: Ecosystem resilience enhanced Climate change transforms ecosystems optimize their climate change adaptation and by altering ecological patterns, species mitigation benefits (e.g., storm buffers and distributions, and suitability of land for specific carbon sink). The interconnectivity of various uses, and so does their capacity to support ecosystems within landscapes and seascapes human adaptation. Thus, rehabilitation of and its impacts on biodiversity, ecological degraded ecosystems (e.g., forest, water, processes, and functions will be considered mangrove, wetlands, seagrass, coral reefs, in development planning. This covers the land) will be accelerated to restore and enhance conduct of carrying capacity assessments to ecosystem services, particularly the ability inform appropriate management interventions of natural systems to protect communities especially in protected areas and ecotourism against the negative impacts of climate change. sites. Indigenous knowledge, systems, and Planning and implementation of interventions practices will also be employed to complement that address vulnerabilities across ecosystems science-based approaches in managing and improve their resilience will be science- ecosystems. In addition, the Department of and evidence-based and risk-informed, such Environment and Natural Resources (DENR) as the use of climate-adjusted hazard maps will strengthen the monitoring of extractive in spatial planning. Also, the Philippine industries’ compliance, including mining and Action Plan for Sustainable Consumption quarrying, to existing environmental laws, and Production (PAP4SCP) will be rules, and regulations. operationalized. This Action Plan follows a comprehensive framework covering policy, Likewise, scaling up the integration of research and development (R&D), innovation, sustainable land management approaches and technology, infrastructure investments, (e.g., soil and water conservation measures, and information and education to enjoin climate-smart technologies) in local plans and consumers and producers to adopt sustainable policies will be pursued to address climate strategies and practices. In addition, natural change impacts on land and water resources. assets will be harnessed to stimulate demand Strengthening and improving the efficiency for green goods, services, and technologies of land administration, particularly the in order to support green jobs and generate streamlining of regulatory mechanisms for income for resource-dependent communities. land titling, will also be prioritized to ensure land tenure security, thereby increasing Intensify ecosystem protection, people’s adaptive capacity to climate change rehabilitation, and management and natural hazards. The government will continue to strengthen Promote and expand natural the management and sustainable use of land, resource-based industries and water, biodiversity, and other natural resources enterprises using integrated and ecosystem-based approaches and nature-based solutions to Collaboration among the government, private sector, academe, civil society, and Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 359 representatives from marginal sectors, such as The development and implementation of the women, youth and indigenous peoples, will be Green Jobs Assessment and Certification bolstered to (a) secure sustainable production, System and Guidelines will be fast-tracked (b) accelerate rehabilitation and conservation to facilitate the shift to cleaner production efforts, (c) strengthen enforcement of technologies and processes, while monitoring environmental rules and regulations, and tools will be further harnessed to account (d) boost the contribution of ecosystems in for the contribution of green jobs to the climate change adaptation and mitigation. economy. Also, government, academe, and the private sector will advance R&D on To promote the green and blue economy, the genetic resources for nature-based products, government will pursue enabling policies that pharmaceuticals, and nutritional supplements. will provide more livelihood and economic Intellectual property rights for such products opportunities, particularly for the poor and will be strengthened to optimize their vulnerable upland and coastal communities. economic potential and ensure equitable Investments in activities that foster the sharing of revenues, especially for local and sustainable management of natural resources, indigenous communities as stewards of our such as on forest and coastal protection and natural resources. rehabilitation, will be increased to generate more jobs and livelihoods. The government Further, the government will partner with and the private sector will also promote other stakeholders to establish market-based and develop more biodiversity-friendly mechanisms, such as payments for ecosystem enterprises and ecotourism sites within and services (PES) that support natural resource outside protected areas. Likewise, forestry conservation measures and accelerate investments will be revitalized by establishing ecosystems and habitat rehabilitation and more commercial forest plantations for timber restoration. The government will also ensure and non-timber forest products, fuelwood, increased compliance with mandatory and high-value crops (e.g., coffee, cacao, regulations (e.g., reporting of environmental and rubber). Marine-based industries and protection expenditures), and encourage enterprises, such as mudcrab fattening, blue the private sector to adopt flexible methods swimming crab culture, seaweed farming, to offset and compensate the ecological and salt production, will also be scaled up and social impacts of their operation and to provide employment opportunities and production—including extractive industries income for coastal communities. (e.g., mining and quarrying—and improve social and environmental standards to fulfill corporate responsibility. Outcome 3: Low carbon economy transition enabled While adaptation remains the country’s (e.g., improved environmental quality and priority climate action, mitigation will be biodiversity) and contribution to green pursued given its environmental co-benefits economic transformation (e.g., increased 360 | Philippine Development Plan 2023-2028 job creation and energy security). As such, updated NDC, to include PAMs for adaptation the government will strengthen the enabling and loss and damage, through a multisectoral environment for private sector engagement in and consultative process. The CCC will also mitigation, promote the development of green develop an implementation and financial plan technologies, and implement transformative to guide the operationalization of NDC PAMs. policies and actions to curb GHG emissions while ensuring just transition of the workforce. Bolster private sector investments in The government will also prioritize actions green development based on the mitigation hierarchy that lead The government will foster an enabling to the best outcomes for communities and policy environment to leverage private the environment, wherein the following sector investments in green technologies and strategies are prioritized in order to: (a) avoid circular business models that generate green adverse impacts, (b) minimize impacts that jobs. This includes exploring the feasibility cannot be avoided, (c) restore or rehabilitate of adopting carbon pricing instruments damage or degradation, and (d) offset or (CPI) as a cost-effective means to encourage compensate for unavoidable impacts. Hence, the transition to clean energy and improve transitioning to a low-carbon economy will energy efficiency in high-emitting sectors (i.e., involve strengthening adaptation actions with energy and industry), raise state revenues, high mitigation potential, such as restoring and address environmental concerns. Local and protecting terrestrial and blue carbon carbon markets will also be established to tap ecosystems (e.g., mangroves and seagrasses). private sector financing, including foreign investments, particularly for the agriculture Implement the Nationally and forestry sectors. To this end, the DENR Determined Contribution policies will identify and establish areas for carbon and measures offsetting and encourage support for relevant Lead sectoral agencies,9 in collaboration initiatives such as efforts to advance the with the private sector, will adopt innovative implementation of Reducing Emissions and transformative low-carbon emitting from Deforestation and Forest Degradation technologies in the energy, agriculture, waste, or REDD+ activities and rehabilitate and industry, and transport sectors. For the energy conserve blue carbon ecosystems. These sector, the Department of Energy will reduce measures will be complemented by intensified, emissions in the supply side by expanding granular geospatial carbon accounting at the renewable energy systems and technologies and sub-national level and in different property scaling-up energy efficiency and conservation rights regimes, including ancestral domains, measures (See Chapter 12). The government as well as developing a national carbon registry will also explore the localization of NDC PAMs to monitor transactions. to increase the capacity and contribution of LGUs to national mitigation actions. Based on The abovementioned strategies will support the country’s emerging needs and priorities, businesses in adopting resource-efficient and the CCC will lead the preparation of an cleaner production measures and pursuing Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 361 supply chain-greening initiatives that optimize manufacturing and production of green and the use of natural resources, minimize climate-smart technology products for global emissions and waste, and reduce risks to markets will also be provided. For instance, people and communities. The promotion of downstream metallic and non-metallic mineral resource-efficient and cleaner production, industries that produce or use renewable particularly in the energy, transport, energy and electric vehicle technologies and and industry sectors, will be supported components (e.g., energy storage solutions) by the full implementation of incentive will be supported to aid in the clean energy mechanisms under existing laws, such as the transition (See Chapters 6 and 12). This will Renewable Energy Act, Energy Efficiency and increase value added in the industry sector and Conservation Act, Electric Vehicle Industry induce the creation of more green jobs. The Development Act, Organic Agriculture Law, government will also continue to support local and Green Jobs Act (See Chapters 5 and 12). industries for R&D and commercialization In addition, local and global partnerships for of sustainable and green technologies and carbon capture and storage from industries products (e.g., through the Innovation Fund) such as steel and cement production and (See Chapter 8). The government will assist power generation will also be explored. micro, small, and medium enterprises and local export producers and suppliers to access Ensure just transition of workers international markets for these technologies affected by the structural changes and products by strengthening their compliance toward a greener, more sustainable, to sustainability standards and enhancing their and low-carbon economy competitiveness (See Chapter 9). The implementation of the Green Jobs Human The implementation of the green public Resource Development Plan will be prioritized, procurement program, ecolabelling, and including the provision of support and training other green certification schemes will be opportunities (e.g., retooling, upskilling, strengthened (e.g., green hotels and resorts, or reskilling on sustainable practices and green buildings, sustainable agriculture) to processes) for workers and enterprises affected guide consumer behavior toward green and by the transition to a sustainable and green sustainable products and services. economy (See Chapters 4 and 6). Expand market opportunities for low-carbon technologies and products Technology development will be promoted through partnership and collaboration among industries, civil society, and the academe. Support for the development of domestic 362 | Philippine Development Plan 2023-2028 Cross-cutting Strategy: Improve governance and intersectionality of climate change and natural hazard resilience Cross-cutting measures will be pursued to change and natural hazard information enable the implementation of strategies aimed centers to enhance the accessibility of climate at ensuring resilient communities, institutions, information and gender-transformative early and ecosystems, and fostering a low-carbon warning systems by communities, which economy. This would also include addressing will also facilitate the scaling up of public the intersectionality of vulnerability in and private resources in resilience building. priority sectors such as agriculture, water, Where applicable, these information centers energy, transportation, and urban–rural will adopt mobile and digital information linkages to enhance climate and disaster and communication technologies such resilience. These measures focus on improving as the Internet of Things, Big Data, space existing governance structures, facilitating science and technology applications, and technology-enabled and science-based policy artificial intelligence, thereby minimizing and planning, and mobilizing sustainable and the fragmentation of current local disaster green investments. warning systems. The government will also develop a National Risk Registry that outlines Improve national and local climate and identifies location-specific hazards, and risk data and information exposure, and vulnerability, complementary management system to the development of localized climate models The National Framework Strategy on Climate and projections. The capacity of lead sectoral Change and National Climate Change Action agencies to conduct regular national GHG Plan (NCCAP) will be updated, and the inventory will also be enhanced to enable National Adaptation Plan will be completed the effective measurement and management based on the latest climate science and of GHG emissions. The conduct of regional aligned with the country’s commitments GHG inventory will also be explored to assess under the 2015 Paris Agreement. The and determine the potential contribution of NCCAP’s results-based monitoring and regions in attaining the NDC targets. evaluation system will also be updated Scale up natural capital accounting and operationalized. A framework and and valuation of ecosystem services methodology to measure resilience will also be developed to effectively monitor the climate The Roadmap to Institutionalize Natural resilience-building efforts from the national Capital Accounting (NCA) in the Philippines down to the local level. The government will be implemented to better inform planning will also support the establishment of local and programming toward increasing the climate change and disaster risk reduction resilience of ecosystems and communities and data management systems and climate comprehensively accounting for the country’s Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 363 wealth. In particular, the Philippine Statistics investments by: (a) providing information on Authority will develop, compile, and regularly emerging climate technologies, and climate update natural capital and ecosystem accounts and environmental uncertainties; (b) building to: (a) monitor changes in natural capital capacity on conducting risk assessments stock, (b) pursue accounting of ecosystem among investors, capitalists, and borrowers; damage and losses from natural hazards and and (c) developing and institutionalizing tools estimation of corresponding monetary value, and approaches to integrate environmental and (c) integrate the value of ecosystem externalities into economic analyses and services into macroeconomic indicators. environmental impact assessments—allowing a holistic accounting of the economic costs The DENR will establish and maintain and benefits of associated investments. In a national geospatial database and data addition, public–private partnerships will management system for natural resources. be encouraged to attract more investors. The The academe, private sector, and civil society establishment of more Green Investment organizations will be tapped and capacitated Banks will also be promoted to support the in collecting timely, updated, and robust development of green markets. environmental data, and in assisting LGUs to generate and use local geospatial information. The government will expand disaster risk The government will also collaborate with said financing beyond the NDRRMF by working stakeholders in conducting applied research with relevant institutions in financing and on NCA. insurance and supporting LGUs in accessing the same, especially for localized preparedness, Scale up the mobilization of relief, early recovery, and reconstruction sustainable finance from public and efforts. In addition, critical support for private sources accessing green financing and risk insurance This includes developing a sustainable, will be given to hazard-prone communities bankable, and gender-responsive pipeline and highly vulnerable sectors such as micro, of projects; implementing a blended small, and medium enterprises and small-scale approach in climate financing (e.g., grants, farmers and fisherfolk. The country will also investments, and subsidies); and expanding continue to uphold the principle of climate the government’s program convergence justice in accessing international climate budgeting approach. Public spending will be finance for adaptation and loss and damage.10 structured such that it stimulates private sector Addressing the intersecting climate investments, while regulations and guidelines vulnerabilities of development sectors requires on accessing government finance facilities will partnership, collaboration, and convergence be streamlined to facilitate improved access, by all institutions. This includes sustaining especially by women. Further, the government actions on climate change adaptation and will work closely with the private sector to mitigation and disaster preparedness, relief, minimize the risks (i.e., physical and transition recovery, and reconstruction, such as: (a) crop risks) that affect the bankability of green diversification, effective fishery management, 364 | Philippine Development Plan 2023-2028 and other climate-resilient technologies and improving distribution efficiency; (d) scaling practices to improve agricultural productivity up and prioritizing electrification of public while reducing GHG emissions (See Chapter 5); transport and transition to renewable energy (b) flood regulation, setting up storage systems, (See Chapter 12); and (e) limiting construction and promoting efficient irrigation system to in hazard-prone areas, allocating green spaces reduce groundwater extraction, sedimentation, (See Subchapter 2.3), and improving regulation and siltation (See Chapter 12); (c) scaling in building codes and permits. up investments in renewable energy and Legislative Agenda Within the medium term, concerned national government agencies will collaborate with the legislative branch toward enacting legislative measures to strengthen the protection and management of natural resources toward a sustainable and climate-resilient development. Table 15.1 contains priority bills for the 19th Congress during the Plan period to accelerate climate action and strengthen disaster resilience. Table 15.1 Legislative Agenda to Accelerate Climate Action and Strengthen Disaster Resilience LEGISLATIVE RATIONALE/DESCRIPTION RESPONSIBLE AGENCY AGENDA Delineation of Specific The bill intends to delineate the specific limits of forestlands for the conservation, protection, Department of Environment Forest Limits Act and development of the country’s forest resources. Identifying the permanent boundary of and Natural Resources forestlands will facilitate the determination of priority areas for protection, production, and (DENR) utilization. This will also provide an enabling policy for the security of tenure to vulnerable forest-dependent communities. Sustainable Forest The bill aims to enhance forest ecosystems through reforestation and forest rehabilitation DENR Management Act to mitigate climate change, improve and conserve biodiversity, enhance ecosystem functions and services, and provide long-term economic benefits. Land Administration This bill aims to upgrade, systematize, and integrate the administration, management, DENR Reform Act and operations of the country’s land resources. It also aims to improve, rationalize, and systematize land records, titling, documentation, and information systems into an open, updated, and reliable system. Land security enhances people’s capacity to effectively manage their land resources and implement measures to adapt to climate change impacts. Integrated Coastal This bill aims to institutionalize ICM as a national strategy to ensure the holistic and DENR Management (ICM) Act sustainable management of various ecosystems and natural resources through the “ridge- to-reef” approach. In addition, the bill pursues the development of an ICM Framework as a guide for local government units in building the resiliency of coastal communities to climate change and other hazards. Natural Capital This bill aims to enable greater stakeholder engagement and sustain budgetary support DENR and Philippine Accounting (NCA) Act for the implementation of NCA activities at the national and subnational levels. The Statistics Authority institutionalization of the NCA will enable the government to quantify and internalize the economic costs and benefits of environmental and climate change externalities into policies and decisions. Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 365 Results Matrix Table 15.2 contains year-by-year and end-of-plan indicators and targets that the government seeks to attain within each of the outcomes during the Plan period to accelerate climate action and strengthen disaster resilience. Table 15.2 Results Matrix to Accelerate Climate Action and Strengthen Disaster Resilience TARGETS RESPONSIBLE MEANS OF INDICATOR BASELINE AGENCY/INTER- 2023 2024 2025 2026 2027 2028 EOP VERIFICATION AGENCY BODY Outcome 1: Climate and disaster risk resilience of communities and institutions increased Number of deaths 0.446 0.4014 0.3791 0.3568 0.3345 0.3122 0.2899 0.2899 Progress Office of Civil attributed to (2021) Report Defense (OCD) disasters per 100,000 population decreased Number of missing 0.0240 0.0216 0.0204 0.0192 0.018 0.0168 0.0156 0.0156 Progress OCD persons attributed (2021) Report to disasters per 100,000 population decreased Number of directly 4,103.06 3,875.11 3,647.16 3,419.21 3,191.27 2,963.32 2,963.32 Progress OCD affected persons 4,558.95 Report attributed to (2021) disasters per 100, 000 population decreased Outcome 2: Ecosystem resilience enhanced Forest cover 24.09 24.53 24.83 24.84 24.95 25.13 25.23 25.23 Annual Department of increased (%) (2020) Progress Environment Report of and Natural Agencies Resources (DENR) Employment 2,547 1,163 1,500 1,500 5,000 7,500 7,500 24,163 Annual Report DENR generated from (2021) resource-based enterprises or industries increased Outcome 3: Low-carbon economy transition enabled Mitigated GHG emissions increased (MtCO2e) * Energy 0 0.39 0.44 0.51 0.59 0.69 0.78 3.40 Unconditional DOE (2019) Nationally Determined Contribution (NDC) policies and measures (PAMs) Industrial process 0 0.33 0.39 0.47 0.54 0.62 0.71 3.06 Unconditional DENR and product use (2019) NDC PAMs Waste 0 0.76 0.80 0.83 0.89 1.04 1.08 5.40 Unconditional DENR (2019) NDC PAMs Transport 0 3.58 3.96 4.13 4.37 4.86 5.14 26.04 Unconditional Department of (2019) NDC PAMs Transportation * Targets are limited to the unconditional policies and measures under the Philippines’ Nationally Determined Contribution. 366 | Philippine Development Plan 2023-2028 1 Provides the framework for harmonizing and integrating efforts of various sectors and stakeholders on climate risk management and strengthening the country’s early action system in view of the increasing losses and damages from recurring extreme weather events. 2 Office of Civil Defense. 2022. The Philippines’ Midterm Review of the Implementation of the Sendai Framework for Disaster Risk Reduction 2015-2030 with a Short-term Review of the National Disaster Risk Reduction and Management Plan (2020–2030). Quezon City: National Disaster Risk Reduction and Management Council, Philippines. https://www.preventionweb.net/media/84407/download. 3 In 2018, the Philippines was ranked 82nd with an Environmental Performance Index score of 57.65. The country slipped into 111th in 2020 with a score of 38.4 4 Department of Science and Technology–Philippine Atmospheric, Geophysical and Astronomical Services Administration ((DOST–PAGASA), Manila Observatory, and Ateneo de Manila University. 2021. Philippine Climate Extremes Report 2020: Observed and Projected Climate Extremes in the Philippines to Support Informed Decisions on Climate Change Adaptation and Risk Management. Quezon City: PAGASA. https://bagong.pagasa.dost.gov.ph/climate/climate-change/ dynamic-downscaling#cep. 5 Atwii, F., K. Bergtora, S. L. Kirch, et al. 2022. WorldRiskReport 2022—Focus: Digitalization. Bochum: Bündnis Entwicklung Hilft; and Institute for International Law of Peace and Armed Conflict, Ruhr University Bochum. https://reliefweb.int/attachments/6c1c1c6f-91d8-48ed-b8b5-b5918cc426a5/WorldRiskReport-2022_ Online.pdf. 6 The Social Sector (i.e., Housing, Education, Health and Nutrition, Culture, and Social Protection) contributed to 45.21% of the total amount of the loss and damage. This was followed by the Productive Sector (i.e., Agriculture and Fisheries, Industry, Trade, and Services, Tourism, and Mining) at 33.58% then Infrastructure (i.e., Transportation, Power Supply, Water Supply, Irrigation System, Telecom, Flood Control) at 11.13%. The Cross-cutting Sector (i.e,. Governance & DRRM, Environment, Livelihood and Employment, Macroeconomic Assessment and Social Impact Assessment) contributed least to the country’s loss and damage from 2011 to 2021 at only 10.09%. 7 World Bank Group. 2022. Philippines Country Climate and Development Report. CCDR Series. Washington, DC. 022. https://www.worldbank.org/en/country/ philippines/publication/philippines-country-climate-and-development-report. 8 World Bank Group. Data Bank: Environment and Social Governance. https://databank.worldbank.org/source/environment-social-and-governance?preview=on# (accessed October 26, 2022). 9 The lead agencies are the Department of Agriculture, Philippine Statistics Authority, Department of Energy, Department of Environment and Natural Resources, and Department of Transportation and Communications. See Aquino III, B. S. 2014. Executive Order 174, s. 2014: Institutionalizing the Philippine Greenhouse Gas Inventory Management and Reporting System. November 24, 2014. https://www.officialgazette.gov.ph/2014/11/24/executive-order-no-174-s-2014/. 10 In the context of the United Nations Framework Convention on Climate Change and Paris Agreement, L&D arising from the adverse effects of climate change can include those related to extreme weather events but also slow onset events, such as sea level rise, increasing temperatures, ocean acidification, glacial retreat and related impacts, salinization, land and forest degradation, loss of biodiversity, and desertification. Chapter 15 Accelerate Climate Action and Strengthen Disaster Resilience | 367 PART V Plan Implementation, Monitoring, and Evaluation 16 Plan Implementation, Monitoring, and Evaluation CHAPTER 16 Plan Implementation, Monitoring, and Evaluation Building on the gains of the previous Philippine Development Plan (PDP) 2017–2022 and learning from lessons of the coronavirus disease (COVID-19) pandemic, the PDP 2023–2028 shifts to higher gear toward economic transformation for a prosperous, inclusive, and resilient society. This economic transformation calls for a whole-of-government and whole-of-society collaboration, which will be enabled through good governance, transparency, accountability, and evidence-based decision-making. Efficient and close coordination at various levels of government is crucial in implementation. The involvement and cooperation of the private sector during monitoring is deemed vital in ensuring that the government remains on track to achieving its targets. Timely assessment and evaluation will also be done to correct deviations. Implementation The government will set the necessary The NEDA Board will oversee the policies and regulatory environment and implementation of measures that directly implement concrete programs, activities, and contribute to the achievement of the headline projects to achieve the targets set in the PDP targets as enumerated in Chapter 1: A Plan for 2023–2028. An executive order will be issued Economic and Social Transformation. directing all government instrumentalities to adopt and align agency plans, roadmaps, Meanwhile, the NEDA Board Committees and and budgetary programs with the Plan. existing clusters will steer the implementation The National Economic and Development of the chapter strategies. Table 16.1 lists the Authority (NEDA) Secretariat will work with lead inter-agencies for the chapters. implementing agencies on the prioritization The Social Development Committee will of identified strategies, policies, programs, and take the lead in ensuring that strategies are projects, including the proposed legislation. implemented to achieve the targets under Given the interrelatedness of the strategies, Chapter 2: Promote Human Capital and inter-agency committees were identified to Social Development. The Social Development lead and coordinate the implementation of the Committee will also push for measures Plan. They are enjoined to regularly discuss the to increase the income-earning ability of status of the transformation agenda and pursue Filipinos as identified in Chapter 4: Increase measures to expedite the rollout of strategies. Income-Earning Ability. Chapter 16 Plan Implementation, Monitoring, and Evaluation | 373 Table 16.1 Coordination Mechanism CHAPTER RESPONSIBLE AGENCY/INTER-AGENCY BODY Chapter 1: A Plan for Economic and Social Transformation NEDA Board Chapter 2. Promote Human and Social Development Social Development Committee Chapter 3. Reduce Vulnerabilities and Protect Purchasing Power Economic Development Cluster* Chapter 4. Increase Income-earning Ability Social Development Committee Chapter 5. Modernize Agriculture and Agribusiness Economic Development Cluster* Chapter 6. Revitalize Industry Economic Development Cluster* Chapter 7. Reinvigorate Services Economic Development Cluster* Chapter 8. Advance Research and Development, Technology, and Innovation National Innovation Council Inter-Agency Investment Promotions Coordination Chapter 9. Promote Trade and Investments Committee; Committee on Tariff-Related Matters Chapter 10. Promote Competition and Improve Regulatory Efficiency Inter-Agency Committee on Good Governance Chapter 11. Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance Development Budget Coordination Committee Chapter 12. Expand and Upgrade Infrastructure Infrastructure Committee National Security Council and Justice Sector Chapter 13. Ensure Peace and Security and Enhance the Administration of Justice Coordinating Council Inter-Agency Committee on Good Governance and Chapter 14. Practice Good Governance and Improve Bureaucratic Efficiency PH-Open Government Partnership Cabinet Cluster on Climate Change Adaptation, Chapter 15. Accelerate Climate Action and Strengthen Disaster Resilience Mitigation, and Disaster Risk Reduction* * Or the equivalent NEDA Board Committee. The Economic Development Cluster or the The transformation agenda will also be equivalent NEDA Board Committee will supported by strategies that promote trade and ensure that measures identified in Chapter 3: investments (Chapter 9: Promote Trade and Reduce Vulnerabilities and Protect Purchasing Investments), to be steered by the Inter-Agency Power are pursued. The EDC will also expedite Investment Promotions Coordination the implementation of measures to transform Committee, and the tariff and non-tariff the production sectors, as identified in Chapter policies to be tackled by the Committee on 5: Modernize Agriculture and Agribusiness, Tariff-Related Matters. Policies promoting Chapter 6: Revitalize Industry, and Chapter 7: competition and improving regulatory Reinvigorate Services. efficiency (Chapter 10: Promote Competition and Improve Regulatory Efficiency) will The National Innovation Council will steer be led by the Inter-Agency Committee on the implementation of measures to advance Good Governance. research and development, technology, and innovation (Chapter 8: Advance Research and To promote macroeconomic stability (Chapter Development, Technology, and Innovation), 11: Ensure Macroeconomic Stability and driving an innovation-based transformation Expand Inclusive and Innovative Finance), the for various sectors. Development Budget Coordination Committee will ensure that fiscal and financial policies 374 | Philippine Development Plan 2023-2028 are sound and supportive of transformation. of justice (See Subchapter 13.2). Meanwhile, Meanwhile, the Infrastructure Committee good governance and the enhancement of will pursue the expansion and upgrading of bureaucratic efficiency (Chapter 14: Practice the country’s infrastructure (See Chapter 12: Good Governance and Improve Bureaucratic Expand and Upgrade Infrastructure). Efficiency) will be steered by the Inter-Agency Committee on Good Governance; and the For Chapter 13: Ensure Peace and Security and acceleration of climate action and disaster Enhance the Administration of Justice, the resilience (Chapter 15: Accelerate Climate National Security Council will lead the Action and Strengthen Disaster Resilience) implementation of strategies to ensure peace will be steered by the Cluster on Climate and security (See Subchapter 13.1) while the Change, Adaptation, Mitigation, and Disaster Justice Sector Coordinating Council will Risk Reduction. have oversight on enhancing administration Monitoring and Evaluation The progress toward achievement of the Gaps and weaknesses in data generation identified outcomes will be monitored and (e.g., unavailable regional breakdown, absence assessed using indicators and interim targets of appropriate methodology to measure as identified in the accompanying Results indicator progress) for the monitoring of the Matrix (RM). The RM was instituted in 2011 Plan will likewise be identified in the SER. To as an instrument designed to provide results address the gaps, the following strategies will orientation to the Plan. It is anchored on be employed: results-based management, which highlights the achievement of outcomes and impact. It (a) Strengthening the collection of data. The aims to strengthen government-wide results Philippine Statistics Development Program orientation, which shall allow for regular will remain the primary mechanism performance assessment of the Plan. to address the data requirements for the monitoring of the PDP and other The RM is a living document that should be sectoral plans and regional plans. It is referred to and updated regularly to ensure envisioned to set the directions, thrusts, responsiveness to the country’s continuously and priorities of the Philippine Statistical evolving development landscape. To assess System in the medium term for the the progress toward achieving the Plan, the generation and dissemination of statistical NEDA Secretariat shall annually prepare the information for policy- and decision- Socioeconomic Report (SER) to present actual making of the government, private sector, accomplishments in terms of outputs and and general public. outcomes as contained in the PDP and the RM. This report shall also identify key challenges (b) Improving analysis, reporting, and use of toward the achievement of results and provide monitoring data. Making the information policy directions moving forward. on the annual accomplishment of RM Chapter 16 Plan Implementation, Monitoring, and Evaluation | 375 indicators and the likelihood of attaining (c) Enhancing capacities to monitor the end-of-plan targets available in an online Plan. The reporting agencies identified platform is important in maintaining in the RM should continue to enhance public accountability and enhancing their capacities to monitor the Plan stakeholder engagement. This may toward ensuring the provision of quality be facilitated through the use of data and timely data. To facilitate this, human visualization solutions such as storyboards, and financial resources to strengthen infographics, and dashboards, among capacities for data collection, analysis, others. Following the open data policy and reporting, as well as statistical literacy of the government, the creation of such a at the national and sub-national levels platform shall improve the accessibility and should be adequately allocated. Stronger comprehension of PDP monitoring data. partnerships with development partners, civil society organizations, and academe shall be pursued to support continuous enhancement of knowledge, skills, processes, and systems on monitoring. Evaluation Agenda for the Philippine Development Plan 2023–2028 NEDA and the Department of Budget and conduct of evaluations in support of good Management (DBM) adopted the National governance, transparency, accountability, and Evaluation Policy (NEP) Framework in 20151 evidence-based decision-making. in line with the government’s continuing As NEDA takes the lead in the formulation of efforts to strengthen its results orientation the PDP and oversees its implementation, the (See Figure 16.1). The National Evaluation agency is in the strategic position to be at the Policy Framework underscores the need to helm in the systematic, rigorous, and impartial develop an evaluative culture in the government assessment of its progress. by providing the framework for the purposive 376 | Philippine Development Plan 2023-2028 Figure 16.1 Evaluation and the Public Sector Management Cycle PLAN FOR RESULTS Indicators with target are specified each level of results EVALUATE RESULTS BUDGET FOR RESULTS Evaluation methodology NATIONAL Budget supports planned enables assessment of results and informed decision-making DEVELOPMENT national priorities GOALS MONITOR RESULTS IMPLEMENT FOR RESULTS Defined indicators are used Policies, people, processes to track achievement of oriented to deliver intended agreed results results Source: Asian Development Bank. 2011. Framework for Results-Based Public Sector Management and Country Cases. Asia-Pacific Community of Practice on Managing for Development Results. Manila. https://www.oecd.org/dac/peer-reviews/Asia%20pacific%20cop%202011%20Framework%20for%20RBPSM%20and%20 Country%20Cases.pdf. A national evaluation agenda will be crafted (a) Undertake scoping studies to identify to set out the priority evaluations that knowledge gaps and the corresponding the government will pursue as a means evaluation studies to create evidence of measuring and obtaining evidence on that will inform the implementation of results derived from strategies and priority priority programs and projects of this interventions laid out in the plan and the administration. These evaluative studies RM. Evaluation will particularly play key are also intended to inform updating of the roles in (a) informing further articulation of current PDP and the formulation of the the PDP and implementation of programs; successor Plan. Agencies should draw on (b) conveying progress achieved against existing evaluation initiatives if available; if priority areas of investment; and (c) promoting not, evaluations may be commissioned. transparency and accountability by making evaluation results accessible to all branches (b) Strengthen the collection, analysis, of government, and most importantly, to the and use of evaluation data to promote public. Toward this end, the government will evidence-based and data-driven adopt the following key strategies: decision-making. At the outcome level of the PDP, the government will continue to collect data on the situation of the Chapter 16 Plan Implementation, Monitoring, and Evaluation | 377 Filipino people through regular surveys (e) Effectively communicate evaluation and explore the application of new and findings to increase utilization and innovative methods to gather data to be influence of evaluations. Capacity used for evaluation. development and the practice of evaluations will be supported by a culture (c) Support the enactment of a National of evidence-based decision-making to Evaluation Policy to accelerate efforts in ensure its mainstreaming. This entails institutionalizing evaluation practice in having an institutionalized evaluation the government. The National Evaluation unit to manage and advocate for Policy comprises necessary instruments evaluation activities within each agency for guiding the practice of monitoring and of the bureaucracy. This unit will ensure evaluation within national development that prioritization and utilization of programs as they provide principles evaluations are integrated into higher-level and standards for data collection and processes such as agency planning and management, utilization, and financing, project development. Documentation of among others.2 monitoring and evaluation activities and learning also ensure that new program (d) Strengthen the capacity of agencies teams can leverage institutional knowledge to conduct and utilize evaluations. To built from previous projects. effectively develop capacities, technical knowledge of evaluations at the individual The NEDA Secretariat will also consult level should be complemented by with the PDP Advisory Committee on the opportunities for hands-on application. assessment of strategies and their effectiveness Nevertheless, the government should in achieving the targets and outcomes. The also aim to establish a structured training PDP Advisory Committee will be convened program for evaluation that is widely during the midterm update preparations, and available, along with supplementary more frequently if necessary. learning resources such as handbooks. 378 | Philippine Development Plan 2023-2028 1 National Economic and Development Authority and Department of Budget and Management. 2015. Joint Memorandum Circular No. 2015-01: National Evaluation Policy Framework of the Philippines. July 15, 2015. https://nep.neda.gov.ph/document/NEDA-DBM%20Joint%20Memorandum%20Circular%20 No.%202015-01%20-%20National%20Evaluation%20Policy%20Framework%20of%20the%20Philippines.pdf. 2 Mwaijande, F. 2018. “Why Should Countries Have National Evaluation Policies?” eVALUation Matters. https://idev.afdb.org/sites/default/files/ Evaluations/2020-03/Why%20Should%20Countries%20have%20National%20Evaluation%20Policies_F%20Mwaijande_0.pdf. Chapter 16 Plan Implementation, Monitoring, and Evaluation | 379 Acronyms 4IR Fourth Industrial Revolution 4Ps Pantawid Pamilyang Pilipino Program 5G Fifth Generation Mobile Network A&F Agriculture and Fisheries ABEMIS Agricultural and Biosystems Engineering Management Information System ACPC Agricultural Credit Policy Council ADAS Advanced driver assistance systems ADB Asian Development Bank ADR Alternative Dispute Resolution AFF Agriculture, Forestry, and Fisheries AFP Armed Forces of the Philippines AI artificial intelligence AI Avian Influenza AIDS Acquired Immunodeficiency Syndrome ALS Alternative Learning System AMCen Advanced Manufacturing Center AMERIAL Advanced Mechatronics, Robotics, and Industrial Automation Laboratory ANYO Agri-Negosyo Loan Program APIS Annual Poverty Indicators Survey APTERR ASEAN Plus Three Emergency Rice Reserve AQRF ASEAN Qualification Reference Framework ARB Agrarian Reform Beneficiaries ARMM Autonomous Region in Muslim Mindanao ARTA Anti-Red Tape Authority ASEAN Association of Southeast Asian Nations ASF African Swine Fever ASPBI Annual Survey of Philippines Business and Industry BADAC Barangay Anti-Drug Abuse Council BAFE Bureau of Agricultural and Fisheries Engineering BAFS Bureau of Agriculture and Fisheries Standards BAI Bureau of Animal Industry BARMM Bangsamoro Autonomous Region in Muslim Mindanao BCP Business Continuity Plan BDP Barangay Development Program BEFF Basic Education Facilities Fund BEPS Base Erosion and Profit Shifting BFAR Bureau of Fisheries and Aquatic Resources BFP Bureau of Fire Protection BIR Bureau of Internal Revenue BIST Business Innovation through Science and Technology BLGF Bureau of Local Government Finance BMCRRP Bangon Marawi Comprehensive Rehabilitation and Recovery Program Acronyms | 381 BNS Barangay Nutrition Scholar BOC Bureau of Customs BOI Board of Investments BOL Bangsamoro Organic Law BOP Balance of Payments BPI Bureau of Plant Industry BPO Business Process Outsourcing BPS Bureau of Philippine Standards BRIGADE Bid-Rigging Intelligence Gathering and Detection Enforcement BSFI BSP-supervised financial institutions BSP Bangko Sentral ng Pilipinas BSWM Bureau of Soils and Water Management BTA Bangsamoro Transition Authority BTr Bureau of the Treasury BUR Budget Utilization Rate CAAP Civil Aviation Authority of the Philippines CAB Comprehensive Agreement on the Bangsamoro CAIR Center for Artificial Intelligence Research CAR Cordillera Administrative Region CAR Capital Adequacy Ratio CARP Comprehensive Agrarian Reform Program CARS Comprehensive Automotive Resurgence Strategy CBA-CPLA Cordillera Bodong Administration-Cordillera Peoples Liberation Army CBFMA Community-based Forest Management Agreements CBMS Community-based Monitoring System CCA Climate Change Adaptation CCAM Climate Change Adaptation and Mitigation CCC Climate Change Commission CCS Carbon capture and storage CDA Cooperative Development Authority CDC Center for Disease Control and Prevention CDP Comprehensive Development Plan CDRA Climate and Disaster Risk Assessment CES Career Executive Service CESB Career Executive Service Board CET 1 Common Equity Tier 1 CHE Current Health Expenditure CHED Commission on Higher Education CHR Commission on Human Rights CIDC Creative Industry Development Council CII Critical Information Infrastructure CIRAS Crime Incident Reporting and Analysis System CiSS Children in Street Situation CJiX Criminal Justice Information Exchange CLC Community Learning Centers 382 | Philippine Development Plan 2023-2028 CLOA Certificate of Land Ownership Award CLUP Comprehensive Land Use Plan COA Commission on Audit ConsumerNet Consumer Network COVID Coronavirus Disease COVID-19 Coronavirus Disease 2019 CPA Citizens Participatory Audit CPI Corruption Perceptions Index CPP-NPA-NDF Communist Party of the Philippines-New People’s Army-National Democratic Front CRADLE Collaborative R&D to Leverage Philippine Economy CREATE Corporate Recovery and Tax Incentives for Enterprises CREVI Comprehensive Roadmap for Electric Vehicle Industry CRM Customer Relationship Management CSC Civil Service Commission CSO Civil Society Organization CSOP community and service oriented policing CSPP Conflict Sensitive and Peace Promoting CTEC Community Training and Employment Coordinators DA Department of Agriculture DAP Development Academy of the Philippines DAR Department of Agrarian Reform DBCC Development Budget Coordination Committee DBM Department of Budget and Management DENR Department of Environment and Natural Resources DepEd Department of Education DFA Department of Foreign Affairs DHSUD Department of Human Settlements and Urban Development DICT Department of Information and Communications Technology DILG Department of the Interior and Local Government DMW Department of Migrant Workers DND Department of National Defense DOE Department of Energy DOF Department of Finance DOH Department of Health DOJ Department of Justice DOJ-OFC Department of Justice - Office for Competition DOLE Department of Labor and Employment DOST Department of Science and Technology DOT Department of Tourism DOTr Department of Transportation DPTR Digital Payments Transformation Roadmap DPWH Department of Public Works and Highways DPWH BOD Department of Public Works and Highways Bureau of Design DRR Disaster Risk Reduction DRRM Disaster Risk Reduction and Management Acronyms | 383 DSWD Department of Social Welfare and Development DTI Department of Trade and Industry DTP Devolution Transition Plan DVA Domestic Value Added DX Roadmap Digital Transformation Roadmap EBEIS Enhanced Basic Education Information System e-BOSS Electronic Business One-Stop Shop EBT Enterprise-based Training EC Electric Cooperative ECCD Early Childhood Care and Development E-CLIP Enhanced Comprehensive Local Integration Program EEC Energy Efficiency and Conservation e-FOI Electronic Freedom of Information EITI Extractive Industries Transparency Initiative EKTI Emerging knowledge-and-technology intensive industries EMB Export Marketing Bureau ENNS Expanded National Nutrition Survey ENRO Environment and Natural Resource Officers ENSO El Nino-Southern Oscillation EO Executive Order EODB EGSD Ease of Doing Business and Efficient Government Service Delivery EPAHP Enhanced Partnership Against Hunger and Poverty EPI Environmental Performance Index EPI e-Participation Index EPIRA Electric Power Industry Reform Act EPR Extended Producer Responsibility EPR Enterprise Resource Planning ERC Energy Regulatory Commission ESD Education for Sustainable Development ESG Environmental, Social, Governance EVIDA Electric Vehicle Industry Development Act EVIS Electric Vehicle Incentive Strategy EV Electric Vehicle E-waste Electronic Waste EWS Early Warning System F2C2 Farm and Fisheries Clustering and Consolidation Program FARA Financial Accounts Regulation Act FDA Food and Drug Administration FDI Foreign Direct Investment FFEDIS Farmers and Fisherfolk Enterprise Development Information System FIA Foreign Investment Act FIES Family Income and Expenditure Survey FIRe Fourth Industrial Revolution FI Financial Institution FISC Financial Inclusion Steering Commitee 384 | Philippine Development Plan 2023-2028 FIST Act Financial Institutions Strategic Transfer Act FMA Fisheries Management Area FMR Farm-to-Market Road FMRDP Farm-to-Market Road Development Program FNRI Food and Nutrition Research Institute FOI Freedom of Information FP Family Planning FSCC Financial Stability Coordination Council FSI Food Security Index FSP Financial Service Provider FTA Free Trade Agreement FTS Foreign Trade Statistics GBV Gender-Based Violence GBV-SEAH Gender-based violence-Sexual exploitation, abuse and sexual harassment GCED Global Citizenship Education GCG Governance Commission for GOCCs GCI Global Competitiveness Index GDP Gross Domestic Product GEA Green Energy Auction GEDSI Gender Equality, Disability, and Social Inclusion GEOAGRI Geographic Information System for Agricultural and Fisheries Machinery and Infrastructure GEOP Green Energy Option Program GERD Gross Expenditure on Research and Development GESI Gender Equality and Social Inclusion GFI Government Financing Institution GHG Greenhouse Gas GICA Geographically Isolated and Conflict Affected GIDA Geographically Isolated and Disadvantaged Areas GII Global Innovation Index GIS Geographic Information System GMV Gross Market Value GNI Gross National Income GOCC Government-Owned and Controlled Corporation GOMP Grid Operation and Maintenance Program GPH Government of the Philippines GPPB Government Procurement Policy Board GQMP Government Quality Management Program GRDP Gross Regional Domestic Product GSIS Government Service Insurance System GSP+ Generalized Scheme of Preferences Plus GSS Green, Social, and Sustainability GVA Gross Value Added GVC Global Value Chain ha hectares Acronyms | 385 HADR Humanitarian Assistance and Disaster Response HCPN Health Care Provider Network HEI Higher Education Institutions HFEP Health Facilities Enhancement Program HGDG Harmonized Gender and Development Guidelines HH Household HIV Human Immunodeficiency Virus HLS Health and Life Science HMO Health Maintenance Organization HNRDA Harmonize National Research and Development Agenda HR Human Resources HRH Human Resources for Health HRMO Human Resource and Management Office HRO Housing and Resettlement Office HS Harmonised System HUC Highly Urbanized City HVC High Value Crops I4PF Industry 4.0 Pilot Factory IBP Integrated Bar of the Philippines IBPAP IT and Business Process Association of the Philippines IC Insurance Commission ICC Indigenous Cultural Communities ICCMN Inter-Cabinet Cluster Mechanism on Normalization ICT Information and Communication Technology ID Industrial Design IDP Internally Displaced Person IEC Information, Education, and Communication IEET Industry, Energy, and Emerging Technologies IF Inclusive Framework IFMA Integrated Forest Management Agreement IGR Intergovernmental Relations IIC Inclusive Innovation Center IIPCC Inter-Agency Investment Promotion Coordination Committee ILO International Labour Organization ILRC Inclusive Learning Resource Centers IMD International Institute for Management Development IMF International Monetary Fund IMT Industrial, Manufacturing, and Transportation IoT Internet of Things IP Indigenous People IP Intellectual Property IPA Investment Promotion Agency IPC Integrated Food Security Phase Classification IPO Initial Public Offering IPOPHL Intellectual Property Office of the Philippines 386 | Philippine Development Plan 2023-2028 IRR Implementing rules and regulations ISF Informal Settler Families ISP Internet Service Provider IT Information technology IT-BPM Information Technology and Business Process Management IT-BPO Information Technology-Business Process Outsourcing IWRM Intergrated Water Resources Management JMC Join Memorandum Circular JSCC Justice Sector Coordinating Council KAYA Kapital Access for Young Agripreneurs KIST Knowledge, Innovation, Science and Technology KSA Key Shelter Agency KTI Knowledge-and-technology intensive industries kWh kilowatt-hour LB Live Birth LBP Land Bank of the Philippines LCAC Local Culture and Arts Councils LCCAP Local Climate Change Action Plan LCY Local Currency LDC Local Development Council LDRRMO Local Disaster Risk Reduction and Management Office LDRRMP Local Disaster Risk Reduction and Management Plan LET Licensure Examination for Teachers LFPR Labor Force Participation Rate LFS Labor Force Survey LFS-APIS Labor Force Survey-Annual Poverty Indicator Survey LGBTQ Lesbian, Gay, Bisexual, Transgender, Queer or Questioning LGBTQIA Lesbian, Gay, Bisexual, Transgender, Queer or Questioning, Intersex, Asexual, LGU Local Government Unit LHB Local Housing Board LIS Learner Information System LMIS Labor Market Information Systems LNG Liquefied Natural Gas LPCC Local Price Coordinating Council LPD Livestock, Poultry, and Dairy LPE Local Peace Engagements LPI Legatum Prosperity Index LRA Land Registration Authority LSB Local Special Bodies LSP Local Shelter Plan LSP Logistics Services Philippines LUC Local Universities and Colleges M&A Mergers and Acquisitions MARIS Maritime Route Rationalization and Information System MBN Modern Basic Needs Acronyms | 387 Mbps Megabits per second MC Memorandum Circular MFI Microfinance Institutions MFP Modern Family Planning MIDP Maritime Industry Development Plan MILF Moro Islamic Liberation Front MIS Management Information Systems MMT Million Metric Tons MNC Multinational Corporation or Company MNLF Moro National Liberation Front MOOC Massive Open Online Courses MRA Mutual Recognition Agreement MRC Medical Reserve Corps MRF Materials Recovery Facility MRO Maintenance, Repair and Overhaul MRV Measurement, Reporting and Verification MSME Micro, Small, and Medium Enterprise MSMED Micro, Small, and Medium Enterprise Development MT Metric tons MTFF Medium-Term Fiscal Framework MUP Military and uniformed personnel NAFMIP National Agri-fishery Modernization and Industrialization Plan NAP National Adaptation Plan NAP-CBRN National Action Plan on Chemical, Biological, Radiological, and Nuclear NAST National Academy of Science and Technology NAT National Achievement Test NBI National Bureau of Investigation NBS Nature Based Solution NCA Natural Capital Accounting NCCAP National Climate Change Action Plan NCD Noncommunicable Disease NCDA National Council on Disability Affairs NCIP National Commission on Indigenous Peoples NCP National Competition Policy NCR National Capital Region NCRMF National Climate Risk Management Framework NDA National Dairy Authority NDC National Development Company NDC Nationally Determined Contribution NDRRMC National Disaster Risk Reduction and Management Council NDRRMF National Disaster Risk Reduction and Management Fund NDRRMP National Disaster Risk Reduction and Management Plan NEAP National Educators’ Academy of the Philippines NEAP National Employment Action Plan NEDA National Economic and Development Authority 388 | Philippine Development Plan 2023-2028 NEET Not in Education, Employment, or Training NEHEMIA National Effort for the Harmonization of Efficient Measures of Inter-related Agencies NEMEAS National ECCD Monitoring Evaluation and Accountability System NEP National Education Portal NERS National Employment Recovery Strategy NFA National Food Authority NFFRS National Farmers and Fisherfolk Registry System NFSCC National Framework Strategy on Climate Change NG National Government NGA National Government Agency NGO Non-government Organization NGRP National Government Rightsizing Program NHA National Housing Authority NHMFC National Home Mortgage Finance Corporation NHRHMP National Human Resources for Health Master Plan NIA National Income Accounts NIASD National Innovation and Agenda Strategy Document NIC National Innovation Council NICER Niche Centers in the Regions for Research and Development NICP National Innovation Communication Plan NIMEX National Innovation Monitoring and Evaluation Matrix NIMP National Irrigation Master Plan NIS National Irrigation Systems NJIS National Justice Information System NMIS National Meat Inspection Service NMIS National Measurement Infrastructure System NMP National Master Plan NNC National Nutrition Council NPCC National Price Coordinating Council NPL Non-Perfoming Loan NPRMS National Policy on Regulatory Management System NPS National Prosecution Service NPS / NPSA National Payment Systems / National Payment Systems Act NQI National Quality Infrastructure NRPF National Resettlement Policy Framework NRPS National Retail Payment System NSFI National Strategy for Financial Inclusion NSS National Spatial Strategy NSW National Single Window NSWMC National Solid Waste Management Commission NTA National Tax Allotment NTC National Telecommunications Commission NTESDP National Technical Education and Skills Development Pla NTF-DPAG National Task Force on the Disbandment of Private Armed Groups NTF-ELCAC National Task Force to End Local Communist Armed Conflict Acronyms | 389 NTM Non-tariff Measure NTMP National Transportation Master Plan NTP National Transport Policy NUDHF National Urban Development and Housing Framework NWPC National Wages and Productivity Commission NWRB National Water Resources Board NWSRM National Water Security Road Map OADR Office for Alternative Dispute Resolution OBI Open Budget Index OCD Office of Civil Defense ODA Official Development Assistance OECD Organization for Economic Cooperation and Development OER Open Educational Resources OF Overseas Filipinos OFOC Open Finance Oversight Committee OF Overseas Filipinos OFW Overseas Filipino Worker OOP Out-of-Pocket OPAPRU Office of the Presidential Adviser on Peace, Reconciliation and Unity OPMS Online Price Monitoring System OSAEC Online Sexual Abuse and Exploitation of Children OTOP One Town, One Product OWWA Overseas Workers Welfare Administration P/E Price-to-Earnings Ratio PAA Performance Assessment and Audit PAASE Philippine American Academy of Science and Engineering PADS Philippine Anti-Illegal Drugs Strategy PAFES Province Led Agri-Fishery Extension System PAGASA Philippine Atmospheric, Geophysical and Astronomical Services Administration PALS Philippine Association of Law Schools PAM Polices and Measures PAMANA Payapa at Masaganang Pamayanan PAO Public Attorney’s Office PAP4SCP Philippine Action Plan for Sustainable Consumption and Production PBB Performance-based Bonus PBRIS Philippine Business Regulations Information System PBS Philippine Banking System PCA Philippine Competition Act PCA Permanent Court of Arbitration PCC Philippine Competition Commission PCECP Philippine Conventional Energy Contracting Program PCG Philippine Coast Guard PCIC Philippine Crop Insurance Corporation PCIDA Philippine Creative Industries Development Act PCM Provinces/Cities/Municipalities 390 | Philippine Development Plan 2023-2028 PCVE Preventing and Countering Violent Extremism PDEA Philippine Drug Enforcement Agency PDG Project Development Grant PDIC Philippine Deposit Insurance Corporation PDL Persons Deprived of Liberty PDP Philippine Development Plan PDRRF Post-Disaster Rehabilitation and Recovery Framework PEDP Philippine Export Development Plan PES Payment for Environmental Services PESO Public Employment Service Offices PEZA Philippine Economic Zone Authority PFM Public financial management PHC Primary Health Care PHFDP Philippine Health Facility Development Plan PhilGEPS Philippine Government Electronic Procurement System PHILGUARANTEE Philippine Guarantee Corporation PhilHealth Philippine Health Insurance Corporation PhilMech Philippine Center for Postharvest Development and Mechanization PhilRice Philippine Rice Research Institute PhilSA Philippine Space Agency PhilSys Philippine Identification System PHLS Philippine Public Health Laboratory System PH-OGP Philippine Open Government Partnership PH-PROGRESO Philippine Program for Recovery with Equity and Solidarity PIDS Philippine Institute for Development Studies PIFITA Passive Income and Financial Intermediary Taxation Act PISA Programme for International Student Assessment PLEA Production Easy Loan Access PM 10 Particulate matter measuring 10 micrometers in diameter or smaller PM 2.5 Particulate matter measuring 2.5 micrometers in diameter or smaller PMI Purchasing Manager's Index PNP Philippine National Police POC Persons of Concern POC Peace and Order Council PODRS Philippine Online Dispute Resolution System PPA Philippine Ports Authority PPE Personal Protective Equipment PPMI Philippine Payments Management, Inc. PPP Public-Private Partnership PQF Philippine Qualifications Framework PQF-NCC Philippine Qualifications Framework-National Coordinating Council PRC Professional Regulation Commission PSA Philippine Statistics Authority PSA Public Service Act PSC Philippine Sports Commission Acronyms | 391 PSCC Philippine Standard Commodity Classification PSEI Philippine Stock Exchange Index PSF Philippine Skills Framework PSF People's Survival Fund PSIC Philippine Standard Industrial Classification PSTO Provincial Science and Technology Office PTTI Passive telecommunications tower infrastructure PUV Public Utility Vehicle PUV SCP Public Utility Vehicle Service Contracting Program PUVMP Public Utility Vehicle Modernization Program PWD Person with Disability PWSSMP Philippine Water Supply and Sanitation Master Plan QS Quacquarelli Symonds R&D Research and Development RA Republic Act RCA Revealed Comparative Advantage RCEP Regional Comprehensive Economic Partnership RCOA Retail Competition and Open Access RCP Representative Concentration Pathway RDC Regional Development Council RDE Research, Development and Extension RDI Research, Development, and Innovation RDI Research and Development Institutions RDLead R&D Leadership RE Renewable Energy RECP Resource-efficient and cleaner production REDD+ Reduce Emissions from Deforestation and Forest Degradation RIIC Regional Inclusive Innovation Center RORO Roll-on/roll-off RPL Recognition of Prior Learning RPMP/ RPA/ ABB Rebolusyonaryong Partido Manggagawang Pilipinas-Revolutionary Proletariat Army-Alex Boncayao Brigade RPS Renewable Portfolio Standards RSBSA Registry System for Basic Sectors in Agriculture RTLA Retail Trade Liberalization Act S&T Science and technology S4CP Science for Change Program SALN Statement of Assets, Liabilities, and Net Worth SAP Social Amelioration Program SBFP School-based Feeding Program SBM School-based Management SC Supreme Court SDD Sex-disaggregated Data SDS Social Development Staff SEC Securities and Exchange Commission 392 | Philippine Development Plan 2023-2028 SEF Special Education Fund SEIPI Semiconductor and Electronics Industries in the Philippines Foundation, Inc. SEZ Special Economic Zone SGC School Governing Council SGLG Seal of Good Local Governance SHFC Socialized Housing Finance Corporation SIA Survey on Innovation Activities of Establishments SICT Survey on Information and Communication Technology SIPP Strategic Investment Priority Plan SIRI Smart Industry Readiness Index SLF Sanitary Landfill Facilities SLM Self-learning Modules SME Small and Medium Enterprise SMP Significant Market Power SP Social Protection SPES Special Program for Employment of Students SPI Social Protection Index SRDP Strengthening and Revitalizing of the Self-Reliant Defense Posture SSF Shared Services Facilities SSS Social Security System SSTA Space Science and Technology Applications STEAM Science, Technology, Engineering, Agriculture-fisheries, and Mathematics STEEAM Science Technology Engineering Entrepreneurship Arts Mathematics STEM Science, Technology, Engineering, and Mathematics STI Science, Technology, and Innovation STPs Science and Technology Parks SUC State Universities and Colleges SUF Spectrum User Fees SURE Survival and Recovery SWM Solid Waste Management SY School Year TAPPP Transport Accreditation Permit and Pass for Ports TB Tuberculosis TBI Technology Business Incubator TESDA Technical Education and Skills Development Authority THE Times Higher Education TIMSS Trends in International Mathematics and Science Study TiVA Trade in Value-Added TMT Technology, Media and Telecommunication TRAIN Tax Reform for Acceleration and Inclusion TSS Teacher Salary Subsidy TTBDO Technology Transfer and Business Development Offices TTMF Temporary Treatment and Monitoring Facilities TUPAD Tulong Panghanapbuhay sa Ating Disadvantaged/Displaced Workers TVET Technical-Vocational Education and Training Acronyms | 393 TVI Technical-Vocational Institutes UDHA Urban Development and Housing Act UHC Universal Health Care UKB Universal and Commercial Banks ULE Updating of the List of Establishments ULP Unified Logistics Pass UM Utility Model UNCAT UN Convention Against Torture and Other Cruel, Inhuman, or Degrading Treatment or Punishment UNESCO United Nations Educational, Scientific and Cultural Organization UNFCCC United Nations Framework Convention on Climate Change UP University of the Philippines UP-SIBOL University of the Philippines - Surgical Innovation and Biotechnology VAT Value-added tax VIP Virology and Vaccine Institute of the Philippines WACS Waste Analysis and Characterization Studies WASH Water, Sanitation, and Hygiene WHO World Health Organization WSP Water Service Providers WSS Water Supply and Sanitation WtE Waste-to-Energy WTO World Trade Organization YOY Year-on-Year 394 | Philippine Development Plan 2023-2028 Glossary [Quality] A unique form of technical vocational education and training, combining on-the- Apprenticeship job training and off-the-job learning, which enable learners from all walks of life to acquire the knowledge, skills and competencies required to carry out a specific occupation. (ILO) Absorptive capacity A measure of an agency's ability to maximize the use of financial resources made available to it. Abuse of dominance Occurs when a dominant firm in a market or group of firms engages in conduct that is intended to eliminate or discipline a competitor or to deter future entry by new competitors, leading to substantially lessened competition (Competition Bureau of Canada, 2018). Abuses of dominance prohibited by the PCA include predatory pricing; exploitative behavior toward consumers, customers, and/or competitors; discriminatory behavior; and limiting production, markets or technical development to the detriment of consumers. (RA 10667, 2015) Acquisition Refers to the purchase of securities or assets, through contract or other means, for the purpose of obtaining control by: (1) One entity of the whole or part of another; (2) Two or more entities over another; or (3) One or more entities over one or more entities. (RA 10667, 2015) Active Transportation Using your own power to get from one place to another. This includes: walking, biking, skateboarding. (DILG, 2020) Adaptation The process of adjustment in natural or human systems in response to actual or expected climatic stimuli or their effects, which moderates harm or exploits beneficial opportunities. (RA No. 9729, 2009) Adaptive Social Adaptive social protection focuses on the potential of linking social protection, Protection DRRM and CCA to enhance households’ resilience to shocks and stresses for agriculture-dependent rural communities. This approach uses social protection tools and mechanisms to tackle climate risks and improve capacities for humanitarian aid to respond to and anticipate the impact of climate change while strengthening opportunities of vulnerable groups. (DSWD & FAO, Establishing an Adaptive and Shock Responsive Social Protection System in the Philippines) Adults’ Ownership Of The percentage of adults (ages 15+) who report having an account (by themselves Financial Account or together with someone else) at a bank or another type of financial institution or personally using a mobile money service in the past 12 months. (UNStats, 2022) Advanced Driver Vehicle-based intelligent safety systems that help improve road safety through crash Assistance System avoidance, crash severity mitigation and protection, and post-crash phases, among others. (European Commmission, 2018) Advanced The DOST's top-of-the-line advanced manufacturing facility and state-of-the-art Manufacturing Center prototyping laboratory aimed at increasing the technological readiness, business sophistication, and innovative capacity of the country’s manufacturing sector. (Advanced Manufacturing Center Website) Advanced AMERIAL serves as a complementary facility that makes enabling technology-based Mechatronics, processes available to more industries to further support manufacturing resurgence Robotics, and Industrial efforts of the country. The AMERIAL also envisions to become a premier training and Automation Laboratory development facility in industrial automation. Housed in the AMERIAL are tools and equipment for training, simulation, and research and development. (AMERIAL website). Affordability The potential amount of income that could be made available for housing investment after excluding basic necessities such as food, clothing, education, medical expenses, transportation, income tax and recurrent costs of housing. (House Joint Resolution No. 0003, n.d.) Agri-food system Covers the whole system from production, consumption, and disposal – from when it is planted, grown, harvested, processed, packaged, transported, distributed, traded, bought, prepared, eaten, and disposed of. It encompasses non-food products, such as forestry, animal rearing, use of feedstock, biomass to produce biofuels and fibers, and constitutes all activities, investments, choices made, and impacts on the livelihoods of all the people that play a part in producing agri-food products. [FAO] Glossary | 395 Airsheds Areas with similar climate, meteorology and topology which affect the interchange and diffusion of pollutants in the atmosphere, or areas which share common interest or face similar development programs, prospects or problems. (RA No. 8749, 1999) Alternate wetting and A water-saving technology that farmers can apply to reduce their irrigation water drying method consumption in rice fields without decreasing its yield. [IRRI] Alternative dispute Any process or procedure used to resolve a dispute or controversy, other than by resolution adjudication of a presiding judge of a court or an officer of a government agency, in which a neutral third party participates to assist in the resolution of issues, which includes arbitration, mediation, conciliation, early neutral evaluation, mini-trial, or any combination thereof. (RA 9285) ANAHAW Philippine Developed by the Center for Appropriate Technology (GrAT) together with the DOT, Sustainable Tourism this aims to mainstream sustainable tourism and energy efficient operations in the Certification tourism sector in the country. (Department of Tourism) Balanced Housing A system whereby owners and/or developers of proposed subdivision and Development condomimium projects shall be required to develop an area for socialized housing. (RA No. 11201, 2018) Bank Runs A run on a bank occurs when a large number of depositors, fearing that their bank will be unable to repay their deposits in full and on time, simultaneously try to withdraw their funds immediately. This may create a problem because banks keep only a small fraction of deposits on hand in cash; they lend out the majority of deposits to borrowers or use the funds to purchase other interest-bearing assets such as government securities. (EconLib, 2018) Barrier-Free Tourism A program of the Department of Tourism to encourage DOT-accredited tourism related establishments as well as tourism destinations to become more user friendly for persons with disabilities. It is used to categorized the travel needs of persons with disabilities so they can move freely and independently as mentioned in Articles 9 and 30 of the UN Convention on the Rights of Persons with Disabilities or UNCRPD stating a provision on accessibility which enables persons with disabilities to live independently independently and participate fully in all aspects of life. Likewise, persons with disabilities can expect to participate fully and enjoy the same tourism activities at par with persons without disabilities. (Department of Tourism) Base Erosion and Profit Tax planning strategies used by multinational enterprises that exploit gaps and Shifting mismatches in tax rules to avoid paying tax. Basic Education The education intended to meet learning needs in order to set the foundation for subsequent learning. It covers six years of primary education, four years of Junior High School, and two years of Senior High School. It also includes alternative learning system for out-of-school youth and adult learners and includes education for those with special needs. (RA 10533, 2013) Basic Education An annual budget of the Department of Education (DepEd) for its school building Facilities Fund program, which covers the improvement and maintenance of school facilities. It is utilized for the provision of classroom and workshop buildings, replacement of old dilapidated buildings, provision of furniture, repair and rehabilitation of classrooms, including heritage buildings, as well as water and sanitation facilities, and electrification. (DepEd Order 35, s. 2017, Revised Guidelines on the Implementation of the Basic Education Facilities Fund) Basic Sanitation Use of improved sanitation facilities which are not shared with another households. Service Level (APIS, 2020) Batas Pambansa 220 It states the standards for economic and socializd housing projects. (Batas Pambansa Blg. 220) Bid-rigging Occurs when competitors coordinate their actions to manipulate the outcome of a bidding process to their benefit. (Philippine Competition Commission) Big Data A massive volume of both structured and unstructured data that is so large that it’s difficult to process with traditional database and software techniques. The characteristics which broadly distinguish big data are sometimes called the ‘3 V’s’: more volume, more variety and higher rates of velocity. (United Nations) Biodiversity-friendly Economic activities and practices of micro, small, and medium enterprises, that enterprises promote the sustainable use of biological resources, create wealth and value, and open opportunities for the equitable sharing of benefits among stakeholders. (DENR-BMB Technical Bulletin No. 2017-01) 396 | Philippine Development Plan 2023-2028 Blue carbon Refers to organic carbon that is captured and stored by the oceans and coastal ecosystems, particularly by vegetated coastal ecosystems (e.g., seagrass meadows, tidal marshes, and mangrove forests). (Nellemann, 2009) Blue economy A practical ocean-based economic model using green infrastructure and technologies, innovative financing mechanisms and proactive institutional arrangements for meeting the twin goals of protecting our oceans and coasts and enhancing its potential contribution to sustainable development, including improving human well-being, and reducing environmental risks and ecological scarcities. (Changwon Declaration, 2012) Blue Ocean Economy Economy that comprises a range of economic sectors and related policies that together determine whether the use of ocean resources is sustainable. (United Nations) Broadband The ITU defined broadband as an always on and high speed access service that provides connection to the Internet and other information services. The broadband is often defined in terms of a threshold minimum capacity however, the broadband service requirements change with the fast-pacing technological advancements hence, should cope up with the needs of the end-users. The National Telecommunications Commission (NTC), through its NTC Memorandum Circular (MC) No. 07-08-2015 defined entry-level broadband as a data connection with speed of at least 256 kbps. Buffer stock Optimal level of rice inventory that shall be maintained at any given time to be used for emergency situations and to sustain the disaster relief programs of the government during natural or man-made calamities. (RA 11203, 2019) Business continuity A document that outlines how a business will continue operating during an unplanned plan disruption in service. Business Innovation This aims to provide financial assistance to Filipino private companies for the through Science and acquisition of strategic and relevant technologies so they can undertake their research Technology and development (R&D). The financial assistance, which may only be used to purchase high-tech equipment or to secure technology licensing and or patent rights, will be refunded to the DOST at zero percent interest (Science for Change Program website). Capital Adequacy Ratio Capital adequacy ratios are a measure of the amount of a bank's capital expressed as a percentage of its risk weighted credit exposures. An international standard which recommends minimum capital adequacy ratios has been developed to ensure banks can absorb a reasonable level of losses before becoming insolvent. (Reserve Bank of New Zealand, 2007) Carbon Accounting A process of measuring the amount of greenhouse gases emitted by countries, industries, and businesses, which can serve as basis in building an effective strategy to manage and reduce GHG emissions. (World Resources Institute & World Business Council for Sustainable Development, 2001) Carbon capture and A process consisting of the separation of carbon dioxide from industrial and energy- storage related sources (e.g., power, cement and steel plants), transporting to a storage location (e.g., geological formations, oceans) for long-term isolation from the atmosphere. (Intergovernmental Panel on Climate Change, 2005) Carbon Pricing Policy instruments that capture the external costs of emitting carbon. CPIs create a Instruments price signal on emissions and can take on multiple forms: (a) emission trading system (ETS) or cap and trade, which is a tradable-permit system that depends on the balance between demand (the total emissions) and the supply (the emission units allocated and available); (b) carbon tax, which creates a price signal for fossil fuel usage to incentivize the move away from carbon-intensive production; (c) emission reduction funds, which are taxpayer-funded schemes wherein a government buys credits created by emission reduction projects. (United Nations Framework Convention on Climate Change, n.d.). Case completion The time it takes for courts to completely dispose of a case. period in judicial dockets Cash Budgeting System Budgeting system where the annual appropriations limit the incurrence of obligations and payments for goods delivered, services, and civil works delivered/rendered, inspected, and accepted within the current fiscal year or the transition period as approved by the President as recommended by the DBM. Cash-lite Economy One in which cash is no longer the most common means of payment. (Bankable Frontiers Associates) Glossary | 397 Certificate of Land A documentary evidence of ownership of the land granted or awarded to the Ownership Award beneficiary by DAR, which contains the restrictions and conditions provided for in the "Comprehensive Agrarian Reform Law of 1988" and other applicable laws. [RA No. 6657] Children Refers to persons below eighteen (18) years of age or those over but are unable to fully take care of themselves or protect themselves from abuse, neglect, cruelty, exploitation or discrimination because of a physical or mental disability or condition. (Republic Act (RA) No. 7610) Circular Business Ways of producing and consuming goods and services that reduce the extraction and Models use of natural resources and the generation of industrial and consumer wastes. They have the potential to drive the transition to a more resource-efficient and circular economy. (Organization for Economic Cooperation and Development, 2018) Circular Economy An economic model of creating value by extending product lifespan through improved design and servicing, and relocating ways from the end of the supply chain to the beginning. (RA No. 11898, 2022) Clearance rate The total case output in a given year as compared to new cases filed in the same year. Climate Change A change in the state of the climate that can be identified by changes in the mean and/ or the variability of its properties and that persists for an extended period, typically decades or longer, whether due to natural variability or as a result of human activity. (RA No. 9729, 2009) Climate Risk and A comprehensive assessment framework for vulnerability assessment linked to climate Vulnerability risks. It identifies communities in the Philippines that are most vulnerable to climate Assessment change to ensure that strategic and effective investments can be made. [DA AMIA] Climate-smart Conventional irrigation technology combined with meteorological stations and their Irrigation Technologies sensors. The irrigation system includes complex interconnected structures and devices, which ensures an optimal water-salt regime in the upper soil layer for high crop yields. [UNEP Copenhagen Climate Centre] Collaborative R&D to Aims to enable technological advancement and innovation of local companies and Leverage Philippine to support the growth of the Philippine Innovation ecosystem. Through the program, Economy the academe and/or RDI in partnership with a Filipino company, undertakes research and development to improve the company’s products, processes, and services to become more competitive in their respective industries. Beneficiary-companies under this program must provide at least 20% counterpart funding and commit to adopt the technology that will be developed. This way, research outputs from the academe are directly translated commercially to the market (Science for Change Program website). Communicable disease Also known as a contagious disease, refers to an illness resulting from an infection, or a disease, which can be transmitted from an infected host individual or group to a particular individual or group. It spreads through direct bodily contact with an infected person, their discharges, or an object or surface they have contaminated. Community Based An organized technology-based system of collecting, processing, and validating Monitoring System necessary disaggregated data that may be used for planning, program implementation, and impact monitoring at the local level while empowering communities to participate in the process. (RA 11315) Competitive neutrality One of the key elements of the National Competition Policy, which recognizes that GOCCs shall not enjoy net competitive advantages or be subjected to advantages over private sector businesses simply by virtue of public sector ownership, unless it can be clearly demonstrated that the greater public interest will be served and there is lack of commercial viability (NEDA-PCC JMC No. 1 on the National Competition Policy, 2020). Compliance This refers to the modes and manners provided by Section 18 of RA 7279, as amended by RA 10884, the implementing rules and regulations, and guidelines of the HLURB by which the developer of the main project can fulfill and satisfy the balanced housing development. (HLURB Resolution No. 965, s. 2017) 398 | Philippine Development Plan 2023-2028 Comprehensive The program is being implemented by the DTI, in order to attract new investments, Automotive stimulate demand, and effectively implement industry regulations that will revitalize Resurgence Strategy the Philippine automotive industry, and develop the country as a regional automotive manufacturing hub. The Comprehensive Automotive Resurgence Strategy (CARS) program is intended to augment and enhance the policy directions of existing motor vehicle development programs toward ensuring a resurgent automotive industry that supports innovation, technology transfer, environmental protection, and small and medium-sized enterprises (SME) development; enable the country’s automotive industry to seize market opportunities opened by the ASEAN Economic Community and deepen its participation in the regional supply chain; and boost the manufacturing capability of the overall industrial sector, spur growth of SMEs, and create more jobs in the country. Comprehensive Land A document which serves as the primary and dominant bases for future use of land Use Plan resources where the requirements for food production, human settlements, and industrial expansion are taken into consideration in its preparation (RA No. 7160, 1991). Comprehensive The CREVI refers to a national development plan for the EV industry with an annual Roadmap for the work plan to accelerate the development, commercialization, and utilization of EVs in Electric Vehicle the country comprised of the following four (4) components: Industry (CREVI) 1) EVs and charging stations component; 2) Manufacturing component; 3) Research and development component; and 4) Human resource development component. Conflict sensitivity and The ability to understand the conflict context, understand how interventions peace promotion interact with the conflict context, and act upon that understanding to minimize negative impacts and maximize positive impacts of interventions (DILG-Office of the Presidential Adviser on the Peace Process [OPAPP] JMC No. 1-2020 Conflict Sensitivity and Peace Promotion (CSPP) in the Comprehensive Development Plan (CDP) of LGUs in Conflict-Affected and Conflict-Vulnerable Areas). Contingent liabilities Payment obligation whose occurrence, timing, and amount depend on uncertain future events or circumstances. Coopetition Cooperating with a competitor to achieve a common goal or get ahead. (Harvard Business Review, 2021) Copyright Protects literary and artistic works, such as books and other writings, musical works, films, painting, and other works and computer programs. Creative Educational The plan to be established by the Department of Education, Commission on Higher Plan education, Technical Education and Skills Development Authority toward human resource development, audience capacity-building, and consumer empowerment in the countr's creative industries, in partnership with the private sector and the academe. (RA 11904, 2022) Creative Industries Defined as trades involving persons whether natural or juridical, that produce cultural, artistic, and innovative goods and services originating in human creativity, skill, and talent and having a potential to create wealth and livelihood through the generation and utilization of intellectual property. (RA 11904, 2022) Creative Industries The plan to be created by the Philippine Creative Industries Development Council to Development Plan set forth the objectives, targets, strategies, and activities on the development and promotion of Philippine creative industries. (RA 11904, 2022) Creative Industries The plan to be created by the Philippine Creative Industries Development Council Investments Priority that contains a list of specific activities in the creative industries that may qualify for Plan incentives. (RA 11904, 2022) Credit Database A database which contains financial statement information and default information of borrowers, collected from banks and credit guarantee associations on an anonymized basis. Criminal Justice The system that provides justice sector agencies the flexibility to develop their own ICT Information Exchange Systems according to their needs and contemporaneously provides the framework that will generate the “commonalities” for easy interchange of crime-related data. Critical information Computer systems, and/or networks, whether physical or virtual, and/or the computer infrastructure programs, computer data, and/or traffic data vital to the country that the incapacity or destruction of, or interference with such systems and assets would have a debilitating impact on security, national or economic security, national public health and safety, or any combination of those matters. (National Cybersecurity Plan, 2022) Glossary | 399 Culture of Peace A set of values, attitudes, modes of behavior, and ways of life that reject violence and provent conflicts by tackling their root causes to solve problems through dialogue and negotiation among individuals, groups, and nations. (UN Culture of Peace Declaration 1998; UN Culture of Peace Program of Action, 1999) Current health Final consumption of health care goods and services by households, government, and expenditure non-profit institutions. Cybercrime A crime in which a computer is the object of the crime (hacking, phishing, spamming) or is used as a tool to commit an offense (child pornography, hate crimes). (National Cybersecurity Plan, 2022) Cybersecurity The collection of tools, policies, security concepts, security safeguards, guidelines, risk management approaches, actions, training, best practices, assurance, and technologies that can be used to protect the cyber environment and organization and user’s assets. (National Cybersecurity Plan, 2022) Decommissioning A process that includes activities aimed at achieving a smooth transition for the former combatants to productive civilian life. (Framework Agreement on the Bangsamoro, Annex on Normalization) Determinants of health Factors that have a significant influence, whether positive or negative, on an individual or population's health, which can include biological, physical, psychological, social, cultural, political, and economic factors, among others. Digital Banks Offers financial products and services that are processed end-to-end through a digital platform and/or electronic channels with no physical branch/sub-branch or branch-lite unit offering financial products and services. (BSP, 2020) Digital Divide The gap between individuals, households, businesses and geographic areas at different socio-economic levels with regard to both their opportunities to access information and communication technologies (ICTs) and to their use of the Internet for a wide variety of activities. Digital Economy The digital economy refers to a broad range of activities, which include the use of knowledge and information as factors in production, information networks as a platform for action and how the information and communication technology (ICT) sector spurs economic growth. (Philippine Statistics Authority) Digital Skills Digital skills refer to a range of skills, encompassing a combination of behaviors, expertise, know-how, work habits, character traits, dispositions, and critical understanding on the use of digital devices, communication applications, and networks to access and manage information. (RA 11927, 2022) Digital Workforce Refers to any natural person who engages in remunerated activity through the use of digital skills and digital technology, regardless of work or employment arrangement, whether as a regular employee of a company or as a freelancer. (RA 11927, 2022) Direct housing This refer to socialized housing assistance by the government through the NHA, SHFC, production HDMF, and GFIs. Disaster A serious disruption of the functioning of a community or a society involving widespread human, material, economic, or environmental losses and impacts which exceed the ability of the affected community or society to cope using its own resources. (RA No. 9729, 2009) Disaster preparedness The knowledge and capacities developed by governments, professional response and recovery organizations, communities and individuals to effectively anticipate, respond to, and recover from, the Impacts of likely, imminent or current hazard events or conditions. (RA 10121) Disaster response The provision of emergency services and public assistance during or immediately after a disaster in order to save lives, reduce health impacts, ensure public safety and meet the basic subsistence needs of the people affected. Disaster response is predominantly focused on immediate and short-term needs and is sometimes called "disaster relief". (RA10121) Disaster risk The potential disaster losses in lives, health status, livelihood, assets and services, which could occur to a particular community or a Society over some specified future time period. (RA 10121) 400 | Philippine Development Plan 2023-2028 Disaster risk reduction The concept and practice of reducing disaster risks through systematic efforts to analyze and manage the causal factors of disasters, including through reduced exposures to hazards, lessened vulnerability of people and property, wise management of land and the environment, and improved preparedness for adverse events. (RA 10121) Disposition rate The percentage of cases disposed by the Court from the total number of existing cases. Dry port An inland intermodal terminal directly connected to seaport(s) with high capacity transport mean(s), where customers can leave/pick up their standardised units as if directly to a seaport. (Roso et al., 2009) Early Warning System The set of capacities needed to generate and disseminate timely and meaningful warning information to enable individuals, communities and organizations threatened by a hazard to prepare and to act appropriately and in sufficient time to reduce the possibility of harm or loss. The expression “end-to-end warning system” is also used to emphasize that warning systems need to span all steps from hazard detection to community response. (RA No. 10121, 2009) Ecolabeling Marks placed on product packaging or in e-catalogs that can help consumers and institutional purchasers identify products that meet specific environmental performance criteria and are therefore deemed “environmentally preferable”. (US Environmental Protection Agency, 2022) Economic rent Income derived from ownership or control over a limited asset or resource. Ecosystem services The contributions of ecosystems to the benefits that are used in economic and other human activity. (UN System of Environmental Economic Accounting, n.d.) Ecosystem-based Also known as an ecosystem approach, the integrated management of land, water, and Approach living resources that promotes conservation and sustainable use in an equitable way. (UN Convention on Biological Diversity, n.d.) Ecotourism A form of sustainable tourism within a natural and cultural heritage area where community participation, protection and management of natural resources, culture and indigenous knowledge and practices, environmental education and ethics as well as economics. (RA No. 10866, 2016) e-Dalaw facility An online video-calling system that aims to give the inmates who are visitorless, especially those who are indigent, sick and/or aged the opportunity to communicate with and see family members. Education for Education for sustainable development empowers learners to take informed decisions sustainable and responsible actions for environmental integrity, economic viability and a just development society, for present and future generations, while respecting cultural diversity. It is about lifelong learning and is an integral part of quality education. (UNESCO Institute for Statistics) E-Government Use of information and communication technologies in government to provide public services, to improve managerial effectiveness and to promote democratic values; as well as a regulatory framework that facilitates information intensive initiatives and fosters the knowledge society. Electric vehicle A vehicle with at least 1 electric drive for vehicle propulsion. This includes battery electric vehicle, hybrid-electric vehicle, light electric vehicle, and a plug-in hybrid- electric vehicle .(RA 11697, 2022). Emerging and re- Emerging infectious diseases (EIDs) are those that have recently appeared within emerging infectious a population or those whose incidence or geographic range is rapidly increasing or diseases threatens to increase shortly. Re-emerging infectious diseases (RIDs) are those which were previously controlled, but have again risen to be a significant health threat. Employed consists of persons in the labor force who are reported either as at work or with a job or business although not at work. Persons at work are those who did some work, even for an hour during the reference period (LFS Technical Notes, PSA) Employment Rate The proportion of employed persons to the total labor force. (LFS Technical Notes, PSA) Glossary | 401 Enabling Environment Covers the indicators related to the institutional arrangements, facilities, budget, policies and practices to support a positive learning environment and to support school engagement with the community. The country meets the aspects if it meets four of the following criteria: (a) has institutional arrangements supporting breadth of skills, (b) has budget supporting breadth of skills, (c) has policies promoting positive school climate, and (d) has policies for schools to engage with communities. (UNESCO) Enterprise-based Enterprised-Based Programs are training program being implemented within Training (EBT) companies/firms. These programs can be any of the following: Apprenticeship program, Learnership Program, and Dual Training System. (TESDA) Environmental, Refers to the process of taking environmental, social and governance (ESG) Social, Governance considerations into account when making investment decisions in the financial sector, Investment/ leading to more long-term investments in sustainable economic activities and projects. Sustainable Finance Event-based Organized and rapid capture of information about events that are a potential risk to surveillance public health; can be rumours and other ad-hoc reports transmitted through formal channels (i.e. established routine reporting systems) and informal channels (i.e. media, health workers and nongovernmental organizations reports), including events related to the occurrence of disease in humans, and events related to potential exposure for humans. Expenditure on Expenditure on education refers to expenditure on core educational goods and Education services, such as teaching staff, school buildings, or school books and teaching materials, and peripheral educational goods and services such as ancillary services, general administration and other activities. Expenditure on education can come from public source (i.e. all government ministries and agencies financing or supporting education programmes in the country), international source, and private source (e.g. households). (UNESCO Institute for Statistics) Extended Producer Refers to the environmental policy approach and practice that requires producers to Responsibility be environmentally responsible throughout the life cycle of a product, especially its post consumer or end-of-life stage. (RA No. 11898, 2022) Farm and Fisheries A program which seeks to advance the inrest and condition of Filipino small farmers Clustering and and fishers by encouraging them to adopt the strategy of clustering and consolidation Consolidation Program of their production, processing, and marketing activities as community business enterprise, including the pooling of assets, labor and other resources. [DA AO No. 27, s. 2020] Fecal Coliform Group of organisms universally present in large numbers in the faeces of man and other warm-blooded animals. Used as a primary bacterial indicator for excremental pollution. (WHO, 1985) Financial Literacy Financial literacy is the level of knowledge about financial concepts and principles. It contributes to consumers’ capability in making sound financial plans and decisions to be financially healthy. (BSP 2021 Financial Inclusion Survey) Financial risk The ability to consume or access needed quality healthcare services without protection experiencing undue financial hardship. Fishery Management A bay, gulf, lake or any other fishery area which may be delineated for fishery resource Areas management purposes. (Fisheries AO No. 263) Food safety The assurance that food will not cause harm to the consumer when it is prepared or eaten according to its intended use. (RA 10611, 2013) Food security A situation when all people, at all times, have physical and economic access to sufficient, safe and nutritious food that meets their dietary needs and food preferences for an active and healthy life. (World Food Summit, 1996) Fortification The addition of nutrients to processed foods or food products at levels above the natural state. As an approach to control micronutrient deficiency, food fortification is the addition of a micronutrient, deficient in the diet, to a food, which is widely consumed by specific at-risk groups. (RA 8976, 2000) Fully immunized Infants who received one dose of Bacillus (or Bacille) Calmette-Guerin (BCG), three children doses each of oral polio vaccine (OPV), diphtheria, pertussis (whooping cough), and tetanus (DPT), and Hepatitis B vaccines, and one dose of measles vaccine before reaching one year of age. 402 | Philippine Development Plan 2023-2028 Gender Refers to a set of socially ascribed characteristics, norms, roles, attitudes, values, and expectations identifying the social behavior of men and women, and the relations between them. (RA 11313) Gender mainstreaming The strategy for making women's, as well as men's, concerns and experiences the integral dimension of the design, implementation, and monitoring and evaluation of policies and programs in all political, economic, and societal spheres so that women and men benefit equally and inequality is not perpetuated. (PCW, 2017) Generalized Scheme of It is a special incentive arrangement for sustainable development and good governance Preferences Plus in the form of zero duties. It is a unilateral trade arrangement, which offers zero tariffs on 6,274 products or 66% of all EU tariff lines. Genetic Resources Refers to all living organisms (i.e. plants, animals, and microbes) carrying genetic material that could be potentially useful to humans. These resources can be taken from the wild, domesticated, or cultivated. They are sourced from environments in which they occur naturally (in situ), or from human-made collections such as botanical gardens, genebanks, seed banks and microbial culture collections (ex situ). (UN Convention on Biological Diversity, n.d.) Geographic A system designed to capture, store, manipulate, analyze, manage, and present all Information System types of spatial or geographical data. (United Nations) Gig economy Covers digital platforms which includes both web-based platforms, where work is outsourced through an open call to a geographically dispersed crowd ("crowdwork"), and location-based applications (apps) which allocate work to individuals in a specific geographical area, typically to perform local, service-oriented tasks such as driving, running errands or cleaning houses. (ILO) Characrerized by independent contracting, contigent work, with variable hours and payment on a piece-work basis. (Woodcock and Graham, 2020) Gig Workers Those engaged in work done in digital labor platforms which includes both web- based platforms, where work is outsourced through an open call to a geographically dispersed crowd (“crowdwork”), and through location-based apps (“work ondemand via apps”) which allocate work to individuals in a specific geographic area. Global Citizenship This concept measures the knowledge, skills, attitudes and values that underpin the Education concept. It is measured through two sub-categories: Global-local thinking (positives attitudes toward their country of residence), and Multicultural(ism)/intercultural(ism) (positives attitudes toward ethnic/racial minorities). (UNESCO Institute for Statistics) Global Innovation The annual ranking of countries by their capacity for, and success in, innovation, Index published by the World Intellectual Property Organization. It was started in 2007 by INSEAD and World Business. serves as the global benchmark that measures innovation along key seven pillars namely, a) Institutions, b) Human Capital and Research, c) Infrastructure, d) Market Sophistication, e) Business Sophistication, f) Knowledge and Technology Outputs, and g) Creative Outputs. It ranks the innovation performance of around 132 economies in the world by highlighting innovation strengths and weaknesses. Good Conduct Time An act that allows for a reduction of sentences of persons deprived of liberty, Allowance (GCTA) Law depending on how well they abide by rules and regulations inside any penal institution, rehabilitation, or detention center or any other local jail. Government Financial These refer to financial institutions or corporations in which the government directly or Institutions indirectly owns majority of the capital stock and. which are either: (1) registered with or directly supervised by the Bangko Sentral ng Pilipinas; or (2) collecting or transacting funds or contributions from the public and places them in financial instruments or assets such as deposits, loans, bonds and equity including, but not limited to, the Government Service Insurance System and the Social Security System. (RA No. 10149, 2010) Government Quality Aims to effect advancement in public sector performance by ensuring the consistency Management Program of products and services that government agencies deliver through the application of processes that can be achieved through an effective Quality Management System. (Development Academy of the Philippines, n.d.) Green Economy An economy that is low-carbon and resource-efficient, resulting in the generation of green jobs and in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities. (RA No. 10771, 2016) Glossary | 403 Green Energy Auction The Green Energy Auction Program (GEAP) was undertaken to support and facilitate Program (GEAP) immediate and timely investments in new or additional renewable energy capacities to ensure provision of adequate supply and competitive rates of electricity in the country. Its aims to ensure transparent and competitive selection of renewable energy facilities to achieve reasonable rates and encourage, as far as practicable, the renewable energy entrants in the system. Green Energy Option The Green Energy Option Program (GEOP) is a Renewable Energy (RE) policy Program (GEOP) mechanism which shall provide end-user the option to choose RE resources as their source of energy. Green Jobs Jobs that help to protect ecosystems and biodiversity, reduce energy, materials and water consumption through high-efficiency strategies, decarbonize the economy, and minimize or altogether avoid generation of all forms of waste and pollution. Green jobs are decent jobs that are productive, respect the rights of workers, deliver a fair income, provide security in the workplace and social protection for families, and promote social dialogue. (RA No. 10771, 2016). Green Public A process whereby public authorities seek to procure goods, services and works with Procurement a reduced environmental impact throughout their life cycle when compared to goods, services, and works with the same primary function that would otherwise be procured. (Government Procurement Policy Board, 2017). Green Spaces Land that is partly or completely covered with grass, trees, shrubs, or other vegetation. Green space includes parks, community gardens, and anthropogenic green spaces such as roof garden, roadside planting, private gardens, and urban parks. (DENR-BMB Technical Bulletin 2018-02) Green, Social, and Bonds issued which fund projects which have positive environmental impacts (e.g. Sustainability Bonds climate change adaptation), social impacts (e.g. provision of basic infrastructure), or a combination of both. Green-grey An example of Nature-based Solution (NbS) that combines conservation and Infrastructure restoration of natural ‘green’ ecosystems with traditional ‘gray’ engineering techniques – such as levees or breakwaters – to shield vulnerable communities from the impacts of climate change. (DENR-BMB, 2019) Greenhouse gases Constituents of the atmosphere that contribute to the greenhouse effect including, but not limited to, carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride. (RA 9729, 2009) Grid Operation and The GOMP of the National Grid Corporation of the Philippines (NGCP) contains the Maintenance Program proposed three-year Planned/Maintenance Outages of grid and system operations- (GOMP) monitored power generation facilities (in consultation with the generating companies), information on the schedule of maintenance per unit/power plant as well as the overall weekly reserve profile per year per grid. It also contains the three-year maintenance program of the Transmission facilities of NGCP aligned to the Planned Outage of the power generation facilities. Gross expenditure on The sum of financial resources used for the execution of research and development R&D (GERD) (R&D) works in the country by the public sector and by the business enterprise sector. Harmonized An after-service availment survey that assesses the overall satisfaction and perception Client Satisfaction of clients on the government service they availed. (Anti-Red Tape Authority, 2022) Measurement Harmonized Gender A standard tool in gender mainstreamining that has checklists to assess the level of and Development gender-responsiveness of the design, implementation, management, monitoring and Guidelines evaluation of programs and projects. (PCW, 2022) Harmonized National Serves as a guide for the prioritization of research programs and projects that will be R&D Agenda pursued by the country to address the societal needs. It directs and ensures anew that the results of science, technology and innovation endeavors are geared toward and are utilized in areas of maximum economic and social benefit for the people. This was formulated by the DOST, in consultation with government and private research and development institutions, the academe, industry and other concerned agencies. Hazard A dangerous phenomenon, substance, human activity or condition that may cause loss of life, injury or other health impacts, property damage, loss of livelihood and services, social and economic disruption, or environmental damage. 404 | Philippine Development Plan 2023-2028 Hazardous Waste Waste which may (a) cause or significantly contribute to an increase in mortality or an increase in serious irreversible, or incapacitating reversible illness; or (b) pose a substantial present or potential hazard to human health or the envrionment when improperly treated stored, transported or disposed of, or otherwise managed. (RA No. 9003) Health care financing Consists of the policies and arrangements that a country has for: revenue sources and contribution mechanisms; pooling of funds; purchasing of services; policies on benefit design, rationing, and the basis for entitlement; and governance of the above functions and policies. Health Care Waste Waste generated as a result of diagnosis, treatment, or immunization of human beings or animals; research pertaining to the aforesaid activities; production or testing of biologicals; and waste originating from minor or scattered sources. (DENR-DOH JAO 2005-02) Health Facilities A priority program of the DOH, attempting to address perennial shortages in health Enhancement Program facilities by augmenting capital investments in the national and LGU health facilities. (Philippine Health Facility Development Plan 2020-2040) Health promotion The process of enabling people to increase control over, and to improve their health by addressing its risk factors, determinants, and root causes of ill health. Health technology Systematic evaluation of properties, effects, or impact of health-related technologies, assessment devices, medicines, vaccines, procedures and all other health-related systems developed to solve a health problem and improve quality of lives and health outcomes, utilizing a multidisciplinary process to evaluate the social, economic, organizational, and ethical issues of a health intervention or health technology. (RA 11223, 2019) Healthcare Waste This includes waste generated as a result of the following: (a) diagnosis, treatment, or immunization of human beings or animals; (b) research pertaining to the aforesaid activities; (c) production or testing of biologicals; and (d) waste originating from minor or scattered sources. (DENR-DOH JAO 2005-02) Holiday Economics Policy allows certain movable holidays to be observed on a Monday or Friday to allow long weekends during the year. Based on RA 9492 (2007) and presidential proclamations (e.g. Presidential Proclamation No. 42: Declaring the regular Holidays and Special Non-Working Holidays in 2023). Housing This refers to a multi-dimensional concept relating to the process of residing and the objects of dwelling whose main attributes are location relative to access to livelihood, tenure arrangements, cost and physical structure, as well as their environment. Housing is likewise a physical structure as well as a social structure, functioning at different spatial scales from homes, neighborhoods, communities, municipalities, cities, provinces, and regions. It is also a sector of the economy, an important category of land use in both urban and rural areas, especially in cities, and is an important factor in the overall dynamics of the urban system. (RA No. 11201, 2018) Housing Escrow Fund The amount of participation required for socialized housing compliance deposited by the private sector in an escrow trust account. (HLURB Resolution No. 965,s. 2017) Inclusive Learning Inclusive Learning Resource Center of Learners with Disabilities (ILRC) refers to a Resource Center physical or virtual center that provides support and related services to teaching and of Learners with learning, using appropriate, accessible, disability, linguistically-culturally-, and gender- Disabilities (ILRC) sensitive instructional learning materials, tools, devices, gadgets, and equipment to facilitate and enhance learning, and assessment tools and instruments, to evaluate developmental domains and specific areas of concern to determine appropriate services and placement decisions, with support and related services from medical, health, and allied professionals for care, rehabilitation, and development of learners with disabilities. (RA 11650) Index crimes Crimes which are serious in nature and which occur with sufficient frequency and regularity such that they can serve index to the crime situation, the policy considers only the crimes of murder, homicide, physical injuries (including frustrated murder and homicide), carnapping, cattle rustling, robbery, theft, and rape as index crimes. (PNP Crime Information Reporting and Analysis System) Individual-based health These are services which can be accessed within a health facility or remotely that can services be definitively traced back to one recipient, has limited effect to population level and does not alter the underlying cause of illness such as ambulatory and inpatient care, medicines, laboratory tests and procedures, among others. Glossary | 405 Industrial Design Consists of three-dimensional features, such as the shape or surface of an article, or of two-dimensional features, such as patterns, lines, or color. Industry 4.0 Pilot Houses cutting-edge manufacturing technologies like advanced robotics, intelligence- Factory of-things, drones, virtual and augmented reality for factory simulations, among others. The Pilot Factory will serve as a demonstration and training hub for learning and pilot Industry 4.0 technologies and solutions to accelerate the digital transformation of Philippine enterprises (DTI website). Inexhaustible resources Inexhaustible resources are those that have an infinite supply and are impossible to deplete, even when constantly exploited by people. Solar, wind, geothermal, water, soil, air, ocean waves, and tides are examples of such resources. Infant mortality rate The probability of dying between birth and age one, expressed as the number of infant deaths or deaths occurring before reaching 12 months of life in a given period per 1,000 live births. Infectious Waste A type of biomedical or health care waste suspected to contain pathogens (bacteria, viruses, parasites or fungi) in sufficient concentration or quantity to cause disease in susceptible hosts (DENR AO 36-2004). Inflation rate The annual rate of change or the year-on-year change in the Consumer Price Index. (NSCB Resolution No. 11 Series of 2003) Informal Settler This refer to households living in a lot, whether private or public, without the consent Families of the property owner; or those without legal claim over the property they are occupying; or those living in danger areas such as esteros, railroad tracks, garbage dumps, riverbanks, shorelines, and waterways. (RA No. 11201, 2018) Innovation The creation of new ideas that results in the development of new or improved products, processes, or services which are then spread or transferred across markets. Insurtech The innovative use of technology in insurance and is a subset of FinTech, or financial technology. InsurTech innovation is occurring across the entire insurance value chain— from distribution and marketing, product design, underwriting, claims management and balance sheet management and across all lines of insurance—property and casualty, life and health. (NAIC, 2022) Integrated Water A process which promotes the coordinated development and management of water, Resources Management land and related resources in order to maximise economic and social welfare in an (IWRM) equitable manner without compromising the sustainability of vital ecosystems and the environment. Integrity Management An anti-corruption program of the government, which aims to establish a systematic Program approach in building, improving, reinforcing and sustaining a culture of integrity in public sector institutions that is rooted in acceptable values, principles and standards of good governance. (Office of the President and Office of the Ombudsman, n.d.) Integrity Transparency A seminar that aims to provide a venue where public service values are internalized and Accountability in and a deeper understanding is enhanced on the role of public servants and the Public Service accountability attached to the positions in the government. (Office of the Ombudsman, n.d.) Intellectual Property Creations of the mind, such as scientific and technological inventions (patent/utility model); literary and artistic works (copyright); designs (industrial design); and symbols, names and images used in commerce (trademark). Intergovernmental The mechanisms for coordination and resolution of issues on intergovernmental relations (IGR) bodies relations through regular consultation and continuing negotiation in a non-adversarial manner between the national and Bangsmoro governments. (RA 11054, Bangsamoro Organic Law) Intermediate Services Intermediate services are services which are used as intermediate inputs in the production of other goods and services that are internationally traded and contribute significantly to global interdependence of economies. (Behuria and Khullar, 1994) Intermodal transport Intermodal, or multimodal, services include more than one mode of transportation and often require connections, choices, and coordination between various modes. International large- International large-scale assessments (ILSAs) assess students' achievement in scale assessments specific disciplines, examples of which are the Programme for International Student (ILSAs) Assessment (PISA), Trends in International Mathematics and Science Study (TIMMS), and Southeast Asia - Primary Learning Metrics (SEA-PLM). ILSAs can be used by policymakers and other educational stakeholders for evidence-based decision making for educational reform. (UNESCO) 406 | Philippine Development Plan 2023-2028 Justice Sector An inter-agency body composed of the Judiciary, the Department of Justice, the Coordinating Council Department of the Interior and Local Government, and their relevant attached agencies, which serves as a joint forum for dialogue on issues of common interest and mechanism for effective coordination and sharing of information for planning and implementation of joint initiatives. Justice Zone An area or locality where a minimum number of inter-agency coordinative reforms are present, rendering that area or locality compliant based on the selection and rating criteria to be established by the JSCC. Katarungang A system of dispute resolution instituted in all barangays in the Philippines that seeks Pambarangay to promote, among others, the speedy administration of justice, by providing all avenues to an amicable settlement of community-level disputes. Key Performance quantifiable indicators of progress toward an intended result that focus on strategic Indicators and operational improvement; create an analytical basis for decision-making, and help focus on what matters most. Key shelter agencies This refers to the attached agencies of the DHSUD namely, the National Housing Authority (NHA), National Home Mortgage Finance Corporation (NHMFC), Home Development Mutual Fund (HDMF), and the Social Housing Finance Corporation (SHFC). (RA No. 11201, 2018) Knowledge Creation The continuous combination, transfer, and conversion of different knowledge. It is a formation of new ideas which occurs through interactions, and includes tacit and explicit forms of knowledge. It usually takes place through R&D activities, learning by doing, team work, strategic alliances, and benchmarking. Knowledge-and- Industries classified by the OECD as high R&D intensive and medium-high R&D technology intensive intensive industries. Following the latest nomenclature of the OECD (Indicators industries 2020) across economies, high R&D-intensive industries include aircraft, computer, electronics and optical products, pharmaceutical, publishing including software while medium R&D-intensive industries include chemicals (excluding pharmaceuticals), pharmaceuticals, electric equipment, other machinery & equipment, and transportation equipment. Labor Force Refers to the population 15 years old and over who contribute to the production of goods and services in the country. It comprises the employed and unemployed. (LFS Technical Notes, PSA) Labor Force The proportion of total labor force to the total household population 15 years and over Participation Rate (LFS Technical Notes, PSA) Labor Market Provides timely relevant and accurate signals on the current labor market such as Information in-demand jobs and skills shortages by developing client-specific LMI, Education and Communication materials. The material is part of the commitment of the DOLE to support the Career Guidance Advocacy Program – a convergence program under the Human Development and Poverty reduction cluster which seeks to promote career guidance as tool in assisting jobseekers particularly students in making informed career choices. (DOLE) Labor Market Labour market interventions aim to give gainful employment to citizens through Interventions employment facilitation and placement schemes, active labour market programmes, emergency and guaranteed employment and unemployment insurance. These programs should also respond to specific needs of sectors. For example, government should adopt measures aimed at enhancing employment and entrepreneurial opportunities and providing security of tenure for the workers in the informal economy. (2019 Revised Social Protection Operational Framework (SPOF) Legatum Prosperity A composite index that assesses countries on the promotion of their residents’ Index (LPI) flourishing, reflecting both economic and social wellbeing in 12 pillars of prosperity split into 67 discrete policy focussed elements, and grouped into three domains essential to prosperity: Inclusive Societies, Open Economies, and Empowered People. (Legatum Institute, 2021) Life expectancy at birth The number of years a newborn child can be expected to live under a given mortality condition of an area in a given year. Limited Sanitation Use of improved sanitation facilities shared with two or more households. (APIS, 2020) Service Level Listahanan The National Household Targeting System for Poverty Reduction is an information management system that identifies who and where the poor are nationwide. (DSWD Listahanan info kit) Glossary | 407 Local Culture and Arts This council to be established by all local government units in coordination with the Council Philippine Creative Industries Development Council and the Department of Interior and Local Government shall exercise functions and powers in addition to those provided under existing statues, memoranda, and other issuances. Its functions are outlined in Section 22 of RA 11904, 2022. Local peace The process which aims to strengthen capacities of national and local governance engagements actors to effectively address socio-economic divides and reduce armed violence in communities to be able to facilitate the delivery of government service, with a long- term view of settling the root causes of conflict in their respective areas. (NTF-ELCAC Local Peace Engagement Guidebook) Low-Skills Services The International Standard Classification of Occupations classifies low-skilled work as mainly consisting of “simple and routine tasks which require the use of hand-held tools and often some physical effort”. It includes: office cleaners; freight holders; garden labourers, kitchen assistants (ISCO-08). By extension, a low-skilled worker could be defined as a person who undertakes low-skilled work. LPI-Government A combination of the quality of public service provision, the quality of the bureaucracy, Effectiveness and the competence of officials. (Legatum Institute, 2021) Lupong Tagapamayapa A peace-making body organized in every barangay to administer Katarungang Pambarangay and composed of the punong barangay as chairman, with a minimum of ten and a maximum of 20 members. Macro-Prudential Policies aimed to manage systemic risks across different segments of the financial Measures market and those that can create systemic risks over periods of time. (BSP, 2020) Malikhaing Pinoy One of the four initiatives under the Malikhain Pinoy Program of the Department of Creative Market Trade and Industry, which will, among other things, include three additional initiatives. Acceleration Program (i.e. creative venture fund, creative learning academy, creative innovation centers) Malnutrition Deficiencies, excesses or imbalances in a person's intake of protein, energy (carbohydrates and fats) and/or nutrients covering both undernutrition which includes suboptimal breastfeeding, stunting, wasting or thinness, underweight and micronutrient deficiencies or insufficiencies, as well as overnutrition, which includes overweight and obesity. (RA 11148, 2018) Marine Litter Refers to any persistent, manufactured or processed solid material discarded, disposed of or abandoned in the marine and coastal environment. (UNEP, 2009) Maritime Industry Adopted pursuant to Presidential Decree No. 474, Series of 1974, or the Maritime Development Plan Industry Decree of 1974 to steer the country's maritime industry toward global competitiveness and sustainable growth through the prioritization of international commitments in the maritime transportation sector and the adoption of integrated approach to development by pooling together the expertise and resources of concerned government agencies, the private sector, and the civil society. (Executive Order 159, Series of 2021) Maritime Industry The 10-year blueprint plan that spells out the needs, goals, and challenges of the whole Development Plan maritime industry, the government and the private sector will have to jointly shell out 2019-2028 the amount through 2028. The Executive Order No. 159, s. 2021 was issued to adopt an integrated approach in the ratification and accession to International Maritime Organization Conventions and Instruments, and Reconstitute the Inter-Agency Coordinating Committee for the Purpose. Maritime Route Aims to develop and design a modular software and other related tools for an Rationalization and effective route capacity measurement system, as part of the modernization plan of Information System Maritime Industry Authority (MARINA) for the Philippine maritime industry through the development of the NAVIS software and incorporation of the necessary models and concepts related to maritime transportation (DOST). Materials Recovery Refers to a cluster of facilities that includes solid waste transfer station or sorting Facility station, drop-off center, a composting facility, and a recycling facility. (RA No. 9003, 2000) Maternal health Health of women during pregnancy, childbirth and the postnatal period. Maternal mortality ratio The ratio between the number of women who died (for reasons of pregnancy, childbirth and puerperium) to the number of reported livebirths in a given year, expressed as the number of maternal deaths per 100,000 live births. Merger Refers to the joining of two or more entities into an existing entity or to form a new entity. (RA 10667, 2015) 408 | Philippine Development Plan 2023-2028 Micro, Small, and This refers to any business activity or enterprise engaged in industry, agribusiness Medium Enterprises and/or services that has: (a) an asset size (less land) of up to PHP100 million; and (b) an employment size with less than 200 employees. Based on these categories, it is classified as micro, small, or medium regardless of the type of business ownership (i.e., single proprietorship, cooperative, partnership, or corporation). Micro-credentials Micro-credentials are typically focused on a specific set of learning outcomes in a narrow field of learning and achieved over a shorter period of time. Micro-credentials are offered by commercial entities, private providers and professional bodies, traditional education and training providers, community organizations and other types of organizations. (UNESCO) Microfinance This refers to a broad range of financial services such as deposits, loans, payment services, money transfers and insurance to the poor and low income households, generally for their microenterprises and small businesses, to enable them to raise their income levels and improve their living standards. (BSP, 2013) Microinsurance Operates the same as conventional insurance except that it is targeted at low-income households, specifically the working poor who have few or no financial reserves and incomes that fluctuate considerably. (NAIC, 2022) Micro-Prudential Policies which examine the responses of an individual bank to exogenous risks and Measures do not incorporate endogenous risk and the interconnectedness with the rest of the system. (IMF, 2013) Mitigation In the context of climate change, mitigation refers to human intervention to address anthropogenic emissions by sources and removals by sinks of all GHG, including ozone- depleting substances and their substitutes. (RA No. 9729, 2009) Mitigation potential The scale of GHG reductions that could be made, relative to emission baselines, for a given level of carbon price (expressed in cost per unit of carbon dioxide equivalent emissions avoided or reduced). (RA No. 9729, 2009) Moderate food A situation when people experience uncertainties about their ability to obtain food, insecurity and have been forced to compromise on the quality and/or quantity of the food they consume. (DOST-FNRI 2018-2019 Expanded National Nutrition Survey) Modern family planning Includes: oral contraceptive pills; female and male sterilization; IUD; injectables; implants; condom; and, natural FP methods such as cervical mucus, basal body temperature method (BBT), symptothermal method, standard days method (SDM) and lactational amenorrhea method. (LAM). Modernizing A regulatory reform initiative that aims to make broad-based improvements in national Government productivity and competitiveness by examining regulations and identifying possible Regulations (MGR) regulatory governance reforms. (Development Academy of the Philippines) Morbidity The frequency of disease and illness, injuries, and disabilities in a population. Mortality rate The age-standardized mortality rate is a weighted average of the age-specific mortality rates per 100 000 persons, where the weights are the proportions of persons in the corresponding age groups of the WHO standard population. Movable Asset The pledging of movable or intangible assets, such as vehicles, livestock, Financing manufacturing equipment, inventory, or receivables, as collateral for loans. (USAid, 2021) Movable Collateral A record of legal claims to personal property used as collateral for a loan. Transparent Registry System collateral registries allow lenders to check if collateral being offered as security for a loan has already been pledged to another lender. (Marketlink, 2022) Multidimensional An approach to diversification of product portfolio under the seven-point agenda of Tourism the Department of Tourism. (Department of Tourism) Mutual Recognition Mutual Recognition Arrangements (MRAs) are framework arrangements established in Arrangements (MRAs) support of liberalising and facilitating trade in services. MRAs aim to facilitate mobility of professionals/ skilled labor in ASEAN. Through exchange of information, MRAs also work toward the adoption of best practices on standards and qualifications. (ASEAN) National Climate Framework for harmonizing and integrating efforts of various sectors and stakeholders Risk Management on climate risk management, and strengthening the country’s early action system in Framework view of the increasing losses and damages from recurring extreme weather events. (CCC Resolution No. 2019-001) Glossary | 409 National Competition The policy that complements the Philippine Competition Act and steers regulations Policy (NCP) and administrative procedures of government agencies to level the economic playing field. It has three key elements, as follows: (1) pro-competitive policies and government interventions; (2) competitive neutrality; and (3) enforcement of competition-related laws and issuances. National Effort for A sectoral-based streamlining effort which targets to reduce the time, cost, the Harmonization of requirements, and procedures in sectors of economic and social significance by 52 Efficient Measures of percent within 52 weeks. (Anti-Red Tape Authority) Inter-related Agencies (NEHEMIA) National Energy A declared policy of the government to promote the judicious conservation and Efficiency and efficient utilization of energy resources through adoption of the cost-effective options Conservation Program toward the efficient use of energy to minimize environmental impact. National Farmers and An online application being used to update the Registry System for Basic Sectors Fisherfolk Registry in Agriculture (RSBSA). It aims to be a reliable source of data and information to be System used as basis/ reference in the implementation of various AFF programs as well as the formulation and evaluation of policies. National Government A one-stop -shop of government data, information, and services. The single website Portal provides citizens, businesses, and government users access to reliable and efficient online services and information. National Irrigation Large and medium schemes of irrigation facilities which are operated and maintained System by the National Irrigation Administration (NIA) for the continuous delivery of water to farmlands. Operation and maintenance of NIS are done with support from irrigators associations (IA). National Justice A integrated information system that is intended to address and remedy the current Information System information gaps in the Philippine criminal justice system by enabling effective sharing of data between the police, judiciary, probation services, custodial authorities, and criminal information registries, at key decision points in the criminal justice system process. National Quality Refers to policy, legal, regulatory, and administrative frameworks, and the institutional Infrastructure arrangements, public and private, to implement standardization, accreditation, and totality of the testing, certification, and measurement necessary to provide acceptable evidence that products and services meet the defined government and market standards. (Senate Bill No. 793) National Resettlement It serves as an overarching framework that outlines common procedures and guidelines Policy Framework for the implementation of resettlement and socialized housing plans and projects for informal settler families (ISFs) and other displaced persons in need of resettlement due to natural or human-induced calamities, emergencies, or crises. National Single A system that enables a single submission of data and information that is Window synchronously processed, resulting in a single point of decision for the release of cargoes by Customs, based on decisions made by other Departments and Agencies of government and communicated in a timely manner to Customs. National Tax Allotment Automatically appropriated and released share of LGUJs, aggregately corresponding to 40 percent of all national taxes based on the collection of the third fiscal year preceding the currenct fiscal year. National Transport Formulated to help achieve the Transport Vision of a “safe, secure, reliable, efficient, Policy integrated, intermodal, affordable, cost-effective, environmentally sustainable, and people-oriented national transport system that ensures improved quality of life of the people”. The NTP, as embodied in NEDA Board Resolution No. 5 s. 2017, “Approving the National Transport Policy”, was adopted by the NEDA Board on 27 June 2017. It was published in general circulation on 14 February 2018. (NEDA, 2021) Pursuant to Section 11 of the NEDA Board Resolution No. 5 s. 2017, the the NEDA Board Committee on Infrastructure (INFRACOM), through the Inter-Agency Technical Committee on Transport Planning (IATCTP), was tasked to formulate and issue the accompanying IRR to effectively carry out the provisions of the NTP. The IRR contains the guidelines and methodologies in the operationalization of the strategies and intended policy reforms in the transport sector toward the realization of the Transport Vision. The INFRACOM, during its 14 December 2018 meeting, approved and adopted the NTP IRR (INFRACOM Resolution No. 01-2018, “Approving the Implementing Rules and Regulations of the National Transport Policy”). The IRR was published in general circulation on 30 December 2019. 410 | Philippine Development Plan 2023-2028 National Transportation Plan that serves as the roadmap that will guide the rational development of Master Plan an intermodal/multimodal transport network in the country, which will connect major and emerging economic growth centers and transport hubs using actual post-pandemic data on travel demand and supply. The plan will be the basis for the respective development planning, investment programming, and implementation initiatives of National Government Agencies(NGAs), Local Government Units (LGUs), and special interest groups. (NEDA, 2022) Nationally Determined A climate action plan for countries to achieve the objectives of the Paris Agreement, Contribution which is updated every five years starting in 2020. It contains the targets, policies and measures to reduce GHG emissions and adapt to climate change impacts as well as information on finance, technologies and capacity building needs (United Nations Framework Convention on Climate Change, n.d.). Natural Capital Natural capital accounting (NCA) is an umbrella term covering efforts to use of an Accounting accounting framework to provide a systematic way to measure and report on stocks and flows of natural capital. NCA covers accounting for individual environmental assets or resources, both biotic and abiotic (such as water, minerals, energy, timber, fish), as well as accounting for ecosystem assets (e.g. forests; wetlands), biodiversity and ecosystem services (United Nations Statistics Division Definition, n.d.) Negative externalities Occurs when the production or consumption of goods and services imposes costs on others which are not reflected in the prices charged for the goods and services being provided. Negentropy The term negentropy is an abbreviation of “negative entropy”. It is also called syntropy. Negentropy is used to explain the presence of “order” within living beings and their tendency to oppose the chaos and disorganization that governs physical systems. Neonatal mortality rate The number of deaths within the first month of life per 1,000 live births. Niche Centers in the The NICER Program aims to address the disparity in access to R&D funding among Regions for R&D the regions. Through the program, qualified Higher Education Institutions (HEIs) in the regions are provided with grants so they can undertake quality research directed at promoting regional development with their existing capabilities and resources. A proposed NICER should be unique, a collaborative project between HEIs, and must be duly endorsed by the Regional Development Council (RDC) to ensure its socio- economic impact in the region (Science for Change Program website). Night-rating Night-Rating is a qualification that allows a pilot to fly an aircraft during the time of ‘night’ as qualified by the International Civil Aviation Organization (ICAO), being the time from 30 minutes after sunset to 30 minutes before sunrise and in Visual Meteorogical Conditions (VMC). No Co-payment Policy No other fees or expenses, including professional fees, shall be charged to all members admitted in any basic or ward accommodations. Non-Bank Financial They are primarily engaged in long-term financing for the expansion and Institutions modernization of productive ventures and in facilitating short-term placements in other financial institutions. These include: i. private nonbank financial intermediaries (Investment houses, financing companies, securities dealers and brokers, investment companies, fund managers, lending investors, pawnshops, private insurance companies, venture capital corporations, and money brokers) ii. government nonbank financial institutions (Government Service Insurance System (GSIS), Social Security System (SSS), National Home Mortgage Finance Corporation, Philippine Veterans Investment Development Corporation, and National Development Corporation), and iii. private nonbank thrift institutions (nonstock savings and loan associations). (PSA, 2011) Noncommunicable Also known as chronic diseases, tend to be of long duration and are the result of a disease combination of genetic, physiological, environmental and behavioural factors. The main types of NCD are cardiovascular diseases (such as heart attacks and stroke), cancers, chronic respiratory diseases (such as chronic obstructive pulmonary disease and asthma) and diabetes. Non-Performing Loan NPL refers to loan accounts whose principal and/or interest is unpaid for thirty (30) days or more after due date or after they have become past due in accordance with existing rules and regulations. (BSP, 2012) Glossary | 411 Non-point Sources Any source of pollution not identifiable as point source including, but not be limited to, runoff from irrgiation or rainwater which picks up pollutants from farms and urban areas (RA No. 9275, 2004) Non-teaching Staff Persons employed by educational institutions who have no instructional responsibilities. Although the definition can vary from one country to another, non- teaching staff generally include headteachers, principals and other administrators of schools, supervisors, counsellors, school psychologists, school health personnel, librarians or educational media specialists, curriculum developers, inspectors, education administrators at the local, regional, and national level, clerical personnel, building operations and maintenance staff, security personnel, transportation workers and catering staff. (UNESCO Institute for Statistics) Non-traditional A set of challenges to the survival and well-being of peoples and states that arise security threats primarily out of non-military sources, such as climate change, resources scarcity, infectious diseases, natural disasters, irregular migration, food shortages, people smuggling, drug trafficking and transnational crime. (Consortium of Non Traditional Security Studies in Asia) Normalization A process wherby communities can achieve their desired quality of life, which includes the pursuit of sustainable livelihood and political participation within a peaceful, deliberative society. (Framework Agreement on the Bangsamoro, Annex on Normalization) Nutrition-sensitive Interventions or programs that address the underlying determinants of maternal, fetal, interventions and infant and child nutrition and development, such as those pertaining to food security, programs social protection, adequate caregiving resources at the maternal, household and community levels; and access to health services and a safe and hygienic environment, and incorporate specific nutrition goals and actions. Nutrition-sensitive programs can serve as delivery platforms for nutrition-specific interventions, potentially increasing their scale, coverage, and effectiveness. (RA 11148, 2018) Nutrition-specific Interventions or programs that address the immediate determinants of maternal, fetal, interventions and infant and child nutrition and development, adequate food and nutrient intake, feeding, programs caregiving and parenting practices, and low burden of infectious diseases. (RA 11148, 2018) One Town, One Product A priority stimulus program for MSMEs as government’s customized intervention to drive inclusive local economic growth. The program enables localities and communities to determine, develop, support, and promote products or services that are rooted in its local culture, community resource, creativity, connection, and competitive advantage. As their own ‘pride-of-place,’ these are offerings where they can be the best at or best renowned for. It endeavors to capacitate our ‘OTOPreneurs’ to innovate and produce market-ready products and services (DTI Website). Open educational Electronic/digital resources and tools for learning in open document format and resources (OER) released under an intellectual property licence allowing free use, adaptation and distribution. (User manual for the implementation of the new UIS Survey on Statistics of Information and Communication Technology (ICT) in Education) Open Financing This refers to leveraging on and sharing of customer-permissioned data among banks, pother financial institutions, and 3rd party providers to develop innovative financial solutions, such as among others, those that provide real time payments, promote greater transparency to account holders, and provide marketing and cross- selling opportunities to banks, other financial institutions, and 3rd party providers. (BSP, 2021) Open Government A multilateral initiative aimed at promoting transparent, participatory, inclusive, Partnership and accountable governance through collaboration between the government and non-government stakeholders. (Open Government Partnership, n.d.) Out-of-pocket These are expenditures of households for goods and services within the health expenditure accounts boundary, which include: medicines, food supplements, other medical products, therapeutic appliances, outpatient medical care, dental care, diagnostic services, and private and public hospital care. Over-Indebtedness A household is over-indebted when its existing and expected resources are insufficient to meet its financial commitments without lowering its standard of living, which might mean reducing it below what is regarded as the minimum acceptable in the country concerned, which in turn might have both social and policy implications. (BIS, 2013) Overweight and The abnormal or excessive fat accumulation that may impair health. It is measured by obesity body mass index (BMI), a simple index of weight-for-height, which is commonly used to classify overweight and obesity among adults. (RA 11148, 2018) 412 | Philippine Development Plan 2023-2028 Patent An exclusive right granted for a new, inventive, & useful product. It can take the form of a new product, process or technical improvement to existing invention. Patient navigation A process where a person (navigator) engages with a patient to determine barriers to care and provides information to improve access to components of the health system, not just primary care. Payment for Ecosystem Arrangement between buyers and sellers of environmental goods and services in which Services (PES) those that pay are fully aware of what it is that they are paying for, and those that sell are proactively and deliberately engaging in resource use practices designed to secure the provision of the services. (Global Environment Facility, 2014) Permanent A fixed place of business through which the business of an enterprise is wholly or establishment partly carried on. Persons Deprived of Includes all persons who are arrested, detained, imprisoned or otherwise under Liberty custody of government authorities. Persons of Concern Refugees, stateless persons, and asylum seekers in the country. (Executive Order No. 163, s.2022) Philippine Conventional The PCECP is a transparent petroleum service contract awarding mechanism that Energy Contracting allows the government to develop and utilize indigenous petroleum resources under a Program (PCECP) service contract with qualified local and international exploration companies. Under the PCECP, awarding of service contracts are conducted either through the competitive selection process or via nomination. The PCECP local road shows are scheduled to be held in Palawan on 20 September, Davao on 27 September and Zamboanga in October 2018. Philippine Creative This is a permanent program of the Philippine Creative Industries Development Council Cities Network that shall serve as an avenue of mutual support, exchange of ideas, and collaboration among the country's cities. (RA11904, 2022) Philippine Good Set of principles outlining good regulatory practices to which agencies can align their Regulatory Principles regulatory processes and activities. It provides supplementary guidance to government (PGRP) agencies, businesses and other regulated entities on how they should regulate and expect to be regulated. (Anti-Red Tape Authority, 2021) Philippine A single national identification system for all citizens and resident aliens of the Identification System Republic of the Philippines. (RA 11055, 2018) Philippine Skills The PSF builds upon the partnership among national government agencies and a key Framework Initiative outcome of the signed MOU in 2019 between DTi, TESDA, and Skills Future Singapore to cooperate on human capital development and the reskilling and upskilling of the workforce. (Department of Trade and Industry) Philippine Toursim This plan is the continuation of the Philippine Tourism Human Resource Development Human Capital Strategy and Action Plan (2015-2020). It builds upon past achievements of the plan Development Plan as well as forges new strategies and action items, keeping in mind that as human 2021-2025 capital, there is a trigger to constantly ensure that the tourism professionals are always valuable assets throughout their work life cycle. (Department of Tourism) PM 10 Particulate Matter (PM) with diameters less than 10 micrometers. (RA No. 8749, 1991) PM 2.5 PM with diameters less than 2.5. (RA No. 8749, 1991) Point source Any identfiable source of pollution with specific point of discharge into a particular water body. (RA No. 9275, 2004) Population-based These are interventions such as health promotion, disease surveillance, and vector health services control, which have population groups as recipients. Preliminary An inquiry or proceeding to determine whether there is a sufficient ground to investigation engender a well-founded belief that a crime has been committed and the respondent is probably guilty thereof and should be held for trial. Pre-service Teacher Recognised and organised, private and public educational programmes designed to Training train future teachers to formally enter the profession at a specified level of education. Graduates receive a government recognised teaching qualification. Pre-service training does not cover teachers who do not meet officially recognised training standards and are enrolled in a teacher training course to earn accreditation concurrent to their work as a teacher. (UNESCO Institute for Statistics) Price elasticity of Ratio of the percentage change in quantity demanded of a good or service to the demand percentage change in the price of that good or service, all other things unchanged. Glossary | 413 Primary expenditure Disbursements of the government excluding the interest payments on the debt. Primary health care This refers to a whole-of-society approach that aims to ensure the highest possible level of health and well-being through equitable delivery of quality health services. Primary Producers A person or organization producing basic agricultural commodities, such as a farmer or fisherfolk. This is defined in the PDP Chapter 7 as families whose household heads are engaged as skilled agricultral workers and AFF laborers. Prime commodities Goods not considered as basic necessities but are essential to consumers such as, but not limited to, flour; dried, processed or canned pork, beef and poultry meat; dairy products not falling under basic necessities; onions, garlic, vinegar, patis, soy sauce; toilet soap; fertilizer, pesticides and herbicides; poultry, livestock and fishery feeds and veterinary products; paper; school supplies; nipa shingles; sawali; cement; clinker; GI sheets; hollow blocks; plywood; plyboard; construction nails; batteries; electrical supplies; light bulbs; steel wire; all drugs not classified as essential drugs by the Department of Health. (RA 10623, 2013) Progressive Star-Rating A three-level recognition scheme of the DOT for Primary Tourism Enterprises entailing System progressive minimum standards and reflecting customers expectations. Province Led Extension services where the province serves as an extension hub that synchronizes Agriculture and agricultural plans and programs as well as orchestrate the activities of the various Fisheries Extension stakeholders. [DA] System Province-wide and Integrated local health systems in which health care providers deliver continuous City-wide Health and integrated health services to individuals and/or communities in a well- defined Systems (P/CWHS) catchment area. These health systems are forms of progressive cooperative undertakings among LGUs to complement the individual LGU’s health operations. The private sector shall be encouraged to participate in the integrated local health system through a contractual arrangement with the P/CWHS. Public Employment is a non-fee charging multi-dimenstional employment service facility or entity Service Office established in all LGUs in coordination with the DOLE pursuant to R.A. No. 8759 or the PESO Act of 1999 as amended by R.A. No. 10691. Public Financial Set of laws, rules, systems, and processes used by the government in resource Management mobilization and expenditure management. It is how the government raises its income (in the form of taxes, customs duties, and other revenues) and manages its expenditures to deliver essential services to its citizens in various areas (i.e., education, health care and other social programs, roads and infrastructure, the rule of law and security). Public health An occurrence or imminent threat of an illness or health condition that: (1) Is caused emergency by any of the following: (i) Bioterrorism; (ii) Appearance of a novel or previously controlled or eradicated infectious agent or biological toxin; (iii) A natural disaster; (iv) A chemical attack or accidental release; (v) A nuclear attack or accident; or (vi) An attack or accidental release of radioactive materials; and, (2) Poses a high probability of any of the following: (i) A large number of deaths in the affected population; (ii) A large number of serious injuries or long-term disabilities in the affected population; (iii) Widespread exposure to an infectious or toxic agent that poses a significant risk of substantial harm to a large number of people in the affected population; (iv) International exposure to an infectious or toxic agent that poses a significant risk to the health of citizens of other countiies; or (v) Trade and travel restrictions. Public Utility Vehicle Introduced under Republic Act 11494 or Bayanihan to Recover as One Act to provide Service Contracting temporary livelihood to displaced transport workers during the pandemic; first phase Program (PUV SCP) provided subsidies to displaced transport workers depending on kilometers traveled made per week, regardless of the number of passengers; second phase provided subsidies to PUV operators depending on vehicle number of trips. (Republic Act No. 11494) Purchasing Managers’ Purchasing Managers’ Index (PMI) data are compiled by S&P Global for more than 40 Index economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities (PMI by S&P Global). 414 | Philippine Development Plan 2023-2028 R&D Leadership The RDLead Program aims to help develop and strengthen further the research capabilities of the academe, research and development institutions (RDIs), and other government line agencies nationwide. To this end, RDLeaders who are local S&T experts with strong leadership and innovative policy proficiencies are engaged to train, and direct and support their R&D goals. Depending on the R&D needs of the academe, RDIs, and line agencies, an RDLeader is engaged through application, screening, and evaluation by the National Research Council of the Philippines (NRCP). NRCP is the implementing agency of the RDLead Program (Science for Change Program website). Rainwater Harvesting A technology that collects and stores rainwater for human use. Rainwater harvesting systems range from simple rain barrels to more elaborate structures with pumps, tanks, and purification systems. (Ogale, 2022) Recommended Energy/ Level of intake of energy or nutrient which is considered adequate for the maintenance Nutrient Intake (REI/ of health and well-being of healthy persons in the population. (FNRI, 2015 Philippine RNI) Dietary Reference Intakes) Regional Inclusive A network of innovation agents that collaborate to commercialize market-oriented Innovation Centers research toward the competitiveness of the region, which aims to generate better employment opportunities, more entrepreneurial activities, and sustainable economic prosperity in the country's regions. (Department of Trade and Industry) Regtech Regulatory technology (regtech) refers to the use of technology—particularly information technology— for regulatory implementation, compliance, and monitoring. It also refers to policy makers’ and regulators’ implementation of regulatory systems and requirements in the context of the technological design of financial infrastructure, including through their interactions with market infrastructure providers. (ADB, 2022) Regulatory Sandbox A framework set up by a regulator wherein fintech startup and other innovators could Framework conduct live experiments within a well-defined space and duration under a regulator’s supervision. It allows market players, who have greater flexibility and are more technically adept than regulators to innovate while providing the regulators a platform to observe and guide innovation in order to assess potential risks or externalities. (BSP, 2018) Regulatory Sandbox A simplified approach available to BSP-supervised financial institutions (BSFIs) to Lite encourage digitalization and/or participation in the electronic offering/delivery of financial products/services that are already within the scope of existing regulations. (BSP, 2022) Renewable Portfolio RPS is a government policy designed to increase the use of renewable energy sources Standards (RPS) for electricity generation. This policy require or encourage electricity suppliers to provide their customers with a stated minimum share of electricity from eligible renewable resources. Resettlement areas This refers to areas identified by the appropriate national agency or by the local government unit with respect to areas within its jurisdiction, which shall be used for the relocation of the underprivileged and homeless citizens. (RA No. 7279, 1992) Resiliency or resilience The capacity of social, economic, and environmental systems to cope with a hazardous event or trend disturbance, responding, or reorganizing in ways that maintain their essential function, identity and structure, while also maintaining the capacity for adaptation, learning and transformation. (IPCC, 2014). Resource Efficient and Continuous application of preventive environmental strategies to processes, products Cleaner Production and services in order to increase efficiency and reduce risks to humans and the environment. RECP addresses the three sustainability dimensions individually and synergistically: a) heightened economic performance through improved productive use of resources, b) environmental protection by conserving resources and minimizing industry’s impact on the natural environment, and c) social enhancement by providing jobs and protecting the wellbeing of workers and local communities. (UNIDO, 2022) Resource Recovery Refer to the collection, extraction or recovery of recyclable materials from the waste stream for the purpose of recycling, generating energy or producing a product suitable for beneficial use: Provided, That, such resource recovery facilities exclude incineration. (RA No. 9003, 2001) Retail Competition and RCOA allows contestable customers to decide which electricity suppliers to source Open Access (RCOA) power from. The establishment of RCOA is mandated by the Electric Power Industry Reform Act of 2001 (EPIRA) to offer options to the end-users and grow the market. Glossary | 415 Revealed Comparative It is a computed metric that tries to approximate a country’s export strengths. The Advantage metric is computed as the share of the Philippines’ exports of a product to total PH exports divided by the share of the world’s exports of a product to total world exports. Roll-on/roll-off A modern cargo handling technique first introduced in 1950s, in which vessels are used to carry wheeled cargo. Rolling stock is ready for delivery upon arrival at the discharge port, and loading, stowing, and discharge operations are simplified. This method is used on board many ships such as ro-ro freight ferries, multipurpose ro-ro carriers, car carriers, rail/vehicle ferries and car/passenger ferries. Route rationalization Route rationalization determines the appropriate mode, quantity and service characteristics of the public transport service in each corridor which will make the routes more responsive to passenger demand and ensure that the hierarchy of roads and modes of transportation are followed. (LTFRB, 2021) Rule of Law A principle of governance in which all persons, institutions and entities, public and private, including the state itself, are accountable to laws. Safe Spaces Safe spaces are streets, public spaces, educational or training institutions, workplace, as well as online spaces free from unwanted and uninvited sexual actions or remarks against any person regardless of the motive. (RA 11313) Sanitary Landfill A waste disposal site designed, constructed, operated, and maintained in a manner that exerts engineering control over significant potential environmental impacts arising from the development and operation of the facility. (RA 9003, 2000) School-based School-based management transfers decision-making authority and responsibility for management school operations from central government to local stakeholders to better reflect local priorities and improve student outcomes. (UNESCO) School-Governing School-Governing Council is the overall coordinating body of all committees, Council associations, and organizations in their schools that shall translate the principle of shared governance enshrined in RA 9155 and contribute in strengthening the implementation of School-Based Management. (Department of Education) Science and Encompasses any kind of high technology cluster such as technopolis, science park, Technology Parks science city, cyber park, industrial park, innovation center, research and development (R&D) park, university research park, research and technology park, science and technology park, science city, science town, technology park, technology incubator, technopark, technopole and technology business incubator run by an organization managed by specialized professionals whose main aim is to increase the wealth of its community by promoting the culture of innovation and the competitiveness of its associated businesses and knowledge-based institution (Senate Bill No. 1944). Science for Change The Science for Change Program (S4CP) was created to accelerate STI in the country Program in order to keep up with the developments in our time wherein technology and innovation are game changers. Through the Science for Change Program (S4CP), the DOST can significantly accelerate STI in the country and create a massive increase in investment on S&T Human Resource Development and R&D (Science for Change Program website). Seal of Good Local An award, incentive, honor and recognition-based program for all LGUs and is Governance a continuing commitment for LGUs to continually progress and improve their performance. (RA 11292, 2019) Secondary Raw Waste materials that can be recycled and then injected back into the economy as new Materials raw materials. (EU COM 614, 2015) Self-reliant defense The development of a national defense industry by incentivizing in-country enterprises posture program and rationalizing defense acquisition. (SB 2113, 17th Congress; SB 1871, 18th Congress) Severe food insecurity A situation when people have typically run out of food and, at worst, gone a day (or days) without eating. (DOST-FNRI 2018-2019 ENNS) Sex-disaggregated The statistical information that differentiates between women and women and allows data one to see where the gaps are in their position or condition (Gender dictionary) or statistical information that differentiates between men and women in order to allow differential impacts on men and women to be measured (GMEF). Shared Agent Network It is a network of cash agents that are contributed by eligible institutions who agree to share agents through an interconnection arrangement and allow payments from and to their own cash agents to be made directly to/from wallets/accounts at other agents. (USAID, 2020) 416 | Philippine Development Plan 2023-2028 Shared Service Facility They refer to machinery, equipment, tools, systems accessories and other auxiliary items, skills, and knowledge that are being provided by the Department of Trade and Industry under a combined and collective system to its target beneficiaries. (RA 11904, 2022) Shock responsive Focuses on the potential for using national social protection systems to deliver social protection responses to shocks in low income countries and fragile contexts, thus reducing the need for separate emergency responses. In this approach, it is important to link with the humanitarian sector in order to build systems that can provide more timely and flexible support in advance or in the aftermath of shocks. (DSWD & FAO, Establishing an Adaptive and Shock Responsive Social Protection System in the Philippines) Shocks A disturbance causing instability, harm, or damage. Significant Market The ability to unilaterally restrict output, raise prices, reduce quality or otherwise act, Power (SMP) to a significant extent, independently of competitive market forces. (Singapore Info- communications Media Development Authority, 2022). Single Carpeta System An integrated database of inmate information management for BJMP, BPP, and PPA. The system will serve as an exchange portal among the three agencies and with the Inmate Management Information System of BUCOR. Single-Use Plastic Disposable plastic materials commonly used as packaging and other items intended to be used only once before they are thrown away or recycled. (UNEP, 2018) Smart Industry SIRI, developed by the Singapore Economic Development Board (EDB), is a suite of Readiness Index frameworks and tools to help manufacturers – regardless of size and industry start, scale, and sustain their manufacturing transformation journeys. It covers three major blocks, namely: Process, Technology, and Organization which are each comprised of pillars and dimensions which are evaluated to generate a holistic Industry 4.0-readiness assessment (DTI website). Social Assistance Social assistance programs give basic protection to those who are poor, excluded, discriminated and marginalized. These may include conditional and unconditional cash transfers, housing and shelter subsidies, food stamps, educational scholarships, etc. Social assistance must be specific depending on the needs of the sector. (2019 Revised SPOF) Social cohesion A state of affairs between and among members of the community and between citizens and their government, where they are bound together by norms, values, practices, and relationships, characterized by respect for diversity, culture of peace, cooperation, and trust. Social health insurance A financing arrangement that ensures access to health care based on a payment of a non-risk-related contribution by or on behalf of the eligible person. The social health insurance scheme is established by a specific public law, defining, among others, the eligibility, benefit package and rules for the contribution payment. Social Insurance Social Insurance and related programs are contributory and non-contributory based schemes protecting households from lifecycle and health related risks. Examples include life and health insurance, crop insurance, pensions, and retirement benefits. (2019 Revised SPOF) Social Protection Constitutes policies and programs that seek to reduce poverty and vulnerability to risks and enhance the social status and rights of the marginalized by promoting and protecting livelihood and employment, protecting against hazards and sudden loss of income, and improving people's capacity to manage risks. (Social Development Committee Resolution No. 1, s. 2007) Social Protection Floor Nationally-defined sets of basic social security guarantees which secure protection aimed at preventing or alleviating poverty, vulnerability, and social exclusion. These include four guarantees -- health care, income security for children, working adults and the elderly. (International Labour Organization) Social Protection Government programs that help individuals and families, especially the poor and System vulnerable, cope with crises and shocks, find jobs, improve productivity, invest in the health and education of their children, and protect the aging population. (WorldBank) Social Safety Nets Short-term stop-gap measures usually implemented as a response to emergencies and crisis situations unlike social assistance and services which maybe regular programs with longer duration. (2019 Revised SPOF) Glossary | 417 Solid Waste Refers to all discarded household, commercial waste, non-hazardous institutional and industrial waste, street sweepings, construction debris, agricultural waste, and other non-hazardous/non-toxic solid waste. (RA No. 9003, 2000) Solid Waste The systematic administration of activities which provide for segregation at source, Management segregated transportation, storage, transfer, processing, treatment, and disposal of solid waste and all other waste management activities which do not harm the environment. (RA No. 9003, 2000) Space Science The scientific principles and their applications to space science, engineering and other and Technology allied fields. (RA No. 11363, 2018) Applications Special Health Fund A pool of financial resources at the P/-CWHS intended to finance health services and health system operations. Specialty center A unit or a department in a hospital that offers specialized care addressing particular conditions and/or providing specific procedures and management of cases requiring specialized training and/or equipment. Startup Any person or registered entity which aims to develop innovative products, processes or business model. Strategic Investment The SIPP lists activities that qualify for investment incentives under the Corporate Priority Plan Recovery and Tax Incentives for Enterprises (CREATE) Act. Incentives in the SIPP take the form of income tax holidays (ITH), enhanced deductions (EH), and a preferential 5 percent corporate income tax rate (CIT). Typically, an incentive will have 4-7 years of ITH before transitioning to 5-10 years of either EH or CIT. Investors can elect whether to claim EH or CIT if engaged in export activities. The length of the incentive depends on which of the three tiers the relevant activity falls under, whether the activity is domestic or for export, and whether the investment is in the National Capital Region, metropolitan areas, or areas contiguous and adjacent to the National Capital Region, or other regions. Strategic Plan for Serves as the Supreme Court's plan of action to address institutional challenges Judicial Innovations using four guiding principles for the Judiciary’s delivery of justice:(1) timely and 2022-2027 fair, (2) transparent and accountable, (3) equal and inclusive, and (4) technology adaptive. Steered by these guiding principles, the Court targets three major outcomes: Efficiency, Innovation, and Access. Stunting Chronic undernutrition during the most critical periods of growth and development in early life. It is defined as the percentage of children aged zero to 59 months whose height for age is below minus two SD (moderate stunting) and minus three SD (severe stunting) from the median of the WHO Child Growth Standards. (RA 11148, 2018) Subsistence incidence The proportion of families/individuals with per capita income/expenditure less than the per capita food threshold to the total number of families/individuals. (NSCB Resolution No. 2 Series of 2007) Supply Chain Financing A form of financial transaction wherein a third party facilitates an exchange by financing the supplier on the customer’s behalf. Also it refers to the techniques and practices used by banks and other financial institutions to manage the capital invested into the supply chain and reduce risk for the parties involved. (ICC) Supreme Court Ruling The SC ruled that all collections of national taxes, except those accruing to special on the Mandanas- purpose funds and special allotments for the utilization and development of the Garcia Case national wealth, should be included in the computation of the base of the just share of local government units. (EO 138, s. 2021) Sustainable Use of services and related products, which respond to basic needs and bring a better Consumption and quality of life while minimizing the use of natural resources and toxic materials as well Production as the emissions of waste and pollutants over the life cycle of the service or product so as not to jeopardize the needs of future generation. (RA No. 11898, 2022) Sustainable Finance Refers to the process of taking environmental, social and governance (ESG) considerations into account when making investment decisions in the financial sector, leading to more long-term investments in sustainable economic activities and projects. Environmental considerations might include climate change mitigation and adaptation, as well as the environment more broadly, for instance the preservation of biodiversity, pollution prevention and the circular economy. Social considerations could refer to issues of inequality, inclusiveness, labour relations, investment in human capital and communities, as well as human rights issues. (European Commission, 2022) 418 | Philippine Development Plan 2023-2028 Sustainable financing The process of taking due account of environmental, social and governance (ESG) considerations when making investment decisions in the financial sector, leading to increased longer-term investments into sustainable economic activities and projects (World Bank, 2021). Sustainable Tourism Tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment and host communities. (UNWTO) Technology adoption The process of accepting, integrating, and using new technology in society. Technology transfer The process of conveying results stemming from scientific and technological research to the market place and to wider society, along with associated skills and procedures, and is as such an intrinsic part of the technological innovation process. The Local Governmet The LGU Energy Code provides the Guidelines for LGUs to facilitate the Unit (LGU) Energy implementation of energy projects. The Energy Code aims to establish, strengthen, Code and integrate national energy plans, programs, policies and mechanisms into local development plans. It encompasses energy safety practices, energy efficiency and conservation, energy resiliency, and energy planning. It will also harmonize and fast- track the implementation of regulatory reform laws/orders such as the Energy Virtual One Stop Shop Act and Ease of Doing Business Act. TradeLine Business intelligence platform that aims to deliver timely and relevant information and assistance to existing and potential exporters to enhance their capabilities and competitiveness as suppliers of quality goods and services to global markets. Trademark A word, or group of words, sign, symbol, or a logo that distinguishes a business’ goods or services from those of other traders. TradeNet The country’s gateway for trade facilitation, which provides automated licensing, permit, clearance, and certification system with regulatory agencies, integrated into one internet-based platform. Transitional justice The approach to address systematic human rights violations committed especially during armed conflict situations, provide redress for victims, and address the root causes of abuses to prevent it from recurring again (International Center for Transitional Justice). Transnational crime Offenses whose inception, perpetration, and/or direct or indirect effects involve more than one country. (UNODC) Transnational Higher Transnational higher education (TNHE) includes all types and modes of delivery of Education higher education study programs, sets of courses of study, or educational services, including distance education and study-abroad programs, which involve education systems of a State different from the State where a TNHE provider operates or programs which may operate independently of any national education system or where the learners are located in a country different from the one where the awarding institution is based. (RA 11448) Transport Accreditation Serves as a single certificate of accreditation (CA), permit to operate (PTO), and Permit and Pass for vehicle access pass for transport service providers; and is required of transport Ports (TAPPP) service providers doing business at ports under the jurisdiction of the Philippine Ports Authority (PPA). (PPA Administrative Order No. 01 - 2022) Triple burden of Simultaneous high prevalence of communicable diseases, noncommunicable diseases, disease and health conditions related to rapid urbanization and industrialization. Underemployed Refers to the employed persons who express the desire to have additional hours of work in their present job or an additional job, or have a new job with longer working hours. (LFS Technical Notes, PSA) Underemployment Rate The proportion of underemployed persons to total employed person. (LFS Technical Notes, PSA) Under-five mortality The probability of dying between birth and age five, expressed as the number of rate deaths below age five per 1,000 live births during a given period. Unemployed Unemployed consists of persons in the labor force who are reported as (1) without work; and (2) currently available for work; and (3) seeking work or not seeking work because of the belief that no work is available, or awaiting results of previous job application, or because of temporary illness or disability, bad weather or waiting for rehire or job recall. The proportion of unemployed persons to the total labor force is called the unemployment rate. Glossary | 419 Unemployment Rate The proportion of unemployed persons to the total labor force. (LFS Technical Notes, PSA) Unimproved Sanitation Use of pit latrines without a slab or platform, hanging latrines or bucket latrines. (APIS, Service level 2020) Universal accessibility The quality of being accessible to the greatest extent possible by everyone, regardless of their age, ability, or status in life. Universal Health Care In the UHC Act, refers to a conceptual framework based on the WHO's three dimensions of universal health coverage: population coverage, service coverage, and financial coverage. Universal logistics pass A unified application form that facilitate the unhampered movement of trucks for hire (ULP) that delivery basic goods and necessities across the country; eliminates the varying and separate pass-through stickers being required by economic zones, ports, and local government units. (ARTA, 2022) Urban agriculture Includes the cultivation, processing and distribution of agricultural products in urban and suburban areas. Community gardens, rooftop farms, hydroponic, aeroponic, and aquaponic facilities, and vertical production are all examples of urban agriculture. (USDA, 2022) Urban Carrying The maximum level of human activities, population growth, land use and physical Capacity development that can be sustained by the urban environment without causing its serious degradation and irreversible damage. (Oh, 2005 as cited in NEDA, 2019) Urban Development This mandates the State to undertake, in cooperation with the private sector, a and Housing (UDHA) comprehensive and continuing Urban Development and Housing Program. (RA No. Act 7279, 1992) Urban Mining A process in which products, components of products, elements, and secondary raw materials from used products are first discarded, and then recovered and reused as products or resources. (ADB, 2019) Utility Model An exclusive right granted for an invention, but it does not require the condition of the involvement of an inventive step to be protected. Value Chain Financing Provides a set of financial instruments that can be applied for agribusinesses at different stages, which helps small holders access the financing they need to expand. There are several financing options besides bank and nonbank credit. (ADB 2017) Venture capital A form of private equity and a type of financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential. Venture Capital Funds A type of investment fund that invests in early-stage startup companies that offer a high return potential but also come with a high degree of risk. The fund is managed by a venture capital firm, and the investors are usually institutions or high net worth individuals. (Corporate Finance Institute, 2022) Violence against Any act or a series of acts committed by any person against a woman who is his women and their wife, former wife, or against a woman with whom the person has or had a sexual or children dating relationship, or with whom he has a common child, or against her child whether legitimate or illegitimate, with or without the family abode, which result in or is likely to result in physical, sexual, psychological harm or suffering, or economic abuse including threats of such acts, battery, assault, coercion, harassment or arbitrary deprivation of liberty. (RA 9262) Vulnerable This includes the Vulnerable self-employed and unpaid family workers. employment Warehouse Receipts The use of securely stored goods as loan collateral. These programs allow producers Financing to deposit a finished good or agricultural product in a secure warehouse where the producer receives a receipt certifying the deposit of goods of a particular quantity, quality, and grade. (USAID, 2000) Waste Diversion Refer to activities which reduce or eliminate the amount of solid waste from waste disposal facilities. (RA No. 9003, 2000) Wasting A reduction or loss of body weight in relation to height. (World Health Organization, 2014) Water Quality Designated areas with similar hydrological, hydrogeological, meteorological or Management Areas geographic conditions which affect the physicochemical, biological and bacteriological reactions and diffusions of pollutants in the water bodies, or otherwise share common interest or face similar development programs, prospects or problems. (RA No. 9275, 2004) 420 | Philippine Development Plan 2023-2028 PDP Organizational Set-up Plan Steering Committee (PSC) Members Chair Secretary Arsenio M. Balisacan, PhD National Economic and Development Authority Members President Ferdinand R. Marcos, Jr. Secretary Bienvenido E. Laguesma Department of Agriculture Department of Labor and Employment Secretary Amenah F. Pangandaman Secretary Manuel M. Bonoan Department of Budget and Management Department of Public Works and Highways Vice President Sara Z. Duterte Secretary Maria Esperanza Christina Garcia-Frasco Department of Education Department of Tourism Secretary Ma. Antonia Yulo-Loyzaga Secretary Alfredo E. Pascual Department of Environment and Natural Resources Department of Trade and Industry Secretary Benjamin E. Diokno, PhD OIC Jose C. Faustino, Jr. Department of Finance Department of National Defense Secretary Benjamin C. Abalos Department of Interior and Local Government Advisory Committee Members Kelly Bird, PhD George Barcelon Country Director, Asian Development Bank Chairman, Philippine Chamber of Commerce and Industry Ndiamé Diop, PhD Sabin Aboitiz Country Director, World Bank Convenor, Private Sector Advisory Council President and Chief Executive Officer, Aboitiz Group Jikyeong Kang, PhD President and Dean, Asian Institute of Management (AIM) Emil Q. Javier, PhD National Scientist, National Academy of Science and Technology Kenneth Cobonpue Entrepreneur Christopher Monterola, PhD Professor and Head, AIM Aboitiz School of Innovation, Gov. Dakila Carlo E. Cua Technology, and Entrepreneurship President, Union of Local Authorities of the Philippines National Chairman, League of Provinces of the Philippines PDP 2023-2028 PDP Organizational Set-up | 423 Planning Committees PLANNING COMMITTEE ON HUMAN AND SOCIAL DEVELOPMENT (CHAPTERS 2.1, 2.2, 2.3 AND 3.2) Planning Committee Chair: Department of Education Member Agencies: Department of Health (DOH) National Nutrition Council (NNC) Department of Human Settlements and Urban Development National Anti-Poverty Commission (NAPC) (DHSUD) National Youth Commission (NYC) Department of Social Welfare and Development (DSWD) Philippine Commission on Women (PCW) Commission on Higher Education (CHED) Commission on Population and Development (POPCOM) Council for the Welfare of Children (CWC) Technical Education and Skills Development Authority (TESDA) Department of Agriculture (DA) Office of the President – Office of Executive Secretary (OP-OES) Department of Budget and Management (DBM) Philippine Health Insurance Corporation (PhilHealth) Department of Agrarian Reform (DAR) Department of Public Works and Highways (DPWH) Department of Information and Communications Technology (DICT) Department of Environment and Natural Resources (DENR) Department of Interior and Local Government (DILG) Philippine National Volunteer Service Coordinating Agency (PNVSCA) Department of Labor and Employment (DOLE) Philippine Statistics Authority (PSA) Department of Science and Technology (DOST) Department of Foreign Affairs (DFA) Department of Migrant Workers (DMW) National Economic and Development Authority (NEDA) Presidential Commission on the Urban Poor (PCUP) CHAPTER 2.1: BOOST HEALTH Planning Subcommittee Chair: Department of Health Member Agencies: Department of Information and Communication Technology Department of Labor and Employment (DOLE) (DICT) Commission on Higher Education (CHED) Commission on Population and Development (POPCOM) Professional Regulation Commission (PRC) Philippine Health Insurance Corporation (PhilHealth) Department of Migrant Workers (DMW) Department of Science and Technology - Food and Nutrition Department of Budget and Management (DBM) Research Institute (DOST-FNRI) Department of the Interior and Local Government (DILG) National Nutrition Council (NNC) Department of Agriculture (DA) Philippine Statistics Authority (PSA) National Economic and Development Authority (NEDA) University of the Philippines - National Institutes of Health (UP-NIH) Department of Public Works and Highways (DPWH) Department of Science and Technology - Philippine Council for House of Representative - Congressional Policy and Budget Research Health Research and Development (DOST-PCHRD) Department (HR-CPBRD) CHAPTER 2.2: IMPROVE EDUCATION AND LIFELONG LEARNING Planning Subcommittee Chair: Department of Education Member Agencies: Commission on Higher Education Department of Public Works and Highways Technical Skills and Development Authority Professional Regulation Comission Department of Information and Communication Technology House of Representative - Congressional Policy and Budget Research Department Early Childhood Care and Development Council National Council on Disability Affairs Department of Science and Technology - Science Education Institute National Commission on Indigenous Peoples Department of Labor and Employment Department of Trade and Industry Philippine Statistics Authority National Economic and Development Authority Philippine Normal University 424 | Philippine Development Plan 2023-2028 CHAPTER 2.3: ESTABLISH LIVABLE COMMUNITIES Planning Subcommittee Chair: Department of Urban Settlements and Urban Development Member Agencies: Department of Public Works and Highways Department of Tourism Climate Change Commission Department of Environment and Natural Resources National Water Resources Board DOST - Philippine Council for Industry, Energy, and Emerging Technology Research and Development Office of the Civil Defense Department of Health Presidential Commission on the Urban Poor Department of Labor and Employment Department of Transportation Department of Information and Communications Technology Department of Interior and Local Government Local Water Utilities Administration Department of Energy Philippine Sports Commission Metropolitan Manila Development Authority National Economic and Development Authority National Commission on Indigenous People Department of Trade and Industry CHAPTER 3.1 ENSURE FOOD SECURITY AND PROPER NUTRITION Planning Committee Chair: National Economic andDevelopment Authority Planning Committee Vice Chair: Department of Agriculture Member Agencies: Department of Trade and Industry Philippine Guarantee Corporation Department of Finance Philippine Institute for Development Studies Department of Agrarian Reform Philippine Statistics Authority Department of Budgement and Management Cooperative Development Authority Department of Environment and Natural Resources Food and Drug Adminstration Department of Labor and Employment Land Bank of the Philippines National Nutrition Council Technical Education and Skills Development Authority Food and Nutrition Research Institute Senate of the Philippines - Senate Economic Planning Office Philippine Council for Agriculture, Aquatic and Natural Resources HoR - Congressional Policy and Budget Research Department Philippine Crop Insurance Corporation CHAPTER 3.2 STRENGTHEN SOCIAL PROTECTION Planning Subcommittee Chair: Department of Social Welfare and Development Member Agencies: Department of Labor and Employment League of Provinces of the Philippines Department of Budget and Management Employees Compensation Commission Department of Interior and Local Government League of Cities of the Philippines Department of Information and Communications Technology National Council on Disability Affairs Council for the Welfare of Children National Commission on Indigenous Peoples Government Service Insurance System Office of the Civil Defense League of Municipalities of the Philippines Philippine Health Insurance Corporation National Anti Poverty Commission Philippine Statistics Authority National Youth Commission Philippine Charity Sweepstakes Office Philippine Commission on Women Philippine National Police Social Security System National Economic and Development Authority Department of Health HoR - Congressional Policy and Budget Research Department PDP 2023-2028 PDP Organizational Set-up | 425 CHAPTER 4: INCREASE INCOME EARNING ABILITY Planning Committee Chair: Department of Labor and Employment Member Agencies: Commission on Higher Education​ National Wages and Productivity Commission Technical Education and Skills Development Authority​ Department of Agriculture​ Department of Trade and Industry​ Department of Science and Technology​ Department of Information and Communications Technology​ Philippine Commission on Women​ National Youth Commission​ Philippine Statistics Authority​ Philippine Institute for Development Studies​ National Economic and Development Authority Department of Education Professional Regulations Commission CHAPTER 5: MODERNIZE AGRICULTURE AND AGRIBUSINESS Planning Committee Chair: Department of Agriculture Planning Committee Vice Chair: Department of Agrarian Reform Member Agencies: Department of Environment and Natural Resources HoR - Congressional Policy and Budget Research Department Department of Trade and Industry Land Bank of the Philippines Department of Science and Technology - Food and Nutrition National Economic and Development Authority Research Institute (DOST-FNRI) National Nutrition Council Department of Science and Technology - Philippine Council for Philippine Crop Insurance Corporation Agriculture, Aquatic and Natural Resources Research and Development​ (DOST-PCAARRD) Philippine Guarantee Corporation Department of Labor and Employment Philippine Institute for Development Studies Department of Finance Philippine Statistics Authority Department of Budget and Management Senate of the Philippines - Senate Economic and Planning Office Cooperative Development Authority Technical Education and Skills and Development Authority Food and Drug Administration CHAPTER 6: REVITALIZE INDUSTRY Planning Committee Chair: Department of Trade and Industry Member Agencies: Bureau of Trade and Industry Policy Research Department of Agriculture Bureau of Small and Medium Entreprise Development Bureau of Fisheries and Aquatic Resources Technical Education Skills and Development Authority Philippine Statistics Authority Intelletual Property of the Philippines Development Bank of the Philippines Department of Environment and Natural Resources - Mines and Congressional Policy and Budget Research Department Geosciences Bureau Competitiveness and Innovation Group Department of Labor and Employment Consumer Policy and Advocacy Bureau Department of Science and Technology Consumer Protection Group Department of Interior and Local Government Board of Investments Philippine Institute for Development Studies Bureau of International Trade Relations Senate of the Philippines - Senate Economic Planning Office Department of Education HoR Commission on Higher Education Philippine Council for Industry, Energy and Emerging Technology, Philippine Trade Training Center Research and Development Anti-Red Tape Authority Bangko Sentral ng Pilipines DTI - Planning and Management Service Competitiveness Bureau Construction Industry Authority of the Philippines Philippine Accreditation Bureau Department of Environment and Natural Resources Bureau of Philippine Standards DTI - Small Business Corporation​  Cooperative Development Authoruty National Economic and Development Authority Philippine Economic Zone Authority Department of Energy 426 | Philippine Development Plan 2023-2028 CHAPTER 7: REINVIGORATE SERVICES Planning Committee Chair: Department of Trade and Industry Member Agencies: National Commission for Culture and the Arts Board of Investments Department of Information and Communications Technology* DTI – Digital Philippines Office Department of Labor and Employment* DTI – Export Marketing Bureau Tourism Infrastructure and Enterprise Zone Authority Philippine Ports Authority Department of Transportation* Civil Aeronautics Board Maritime Industry Authority National Telecommunications Commission Civil Aviation Authority of the Philippines Design Center of the Philippines Technical Education and Skills Development Authority Department of Tourism Philippine Institute for Development Studies Philippine Economic Zone Authority Congressional Policy and Budget Research Department* Philippine Statistics Authority Senate Economic Planning Office National Economic and Development Authority Bangko Sentral ng Pilipinas CHAPTER 8: ADVANCE RESEARCH & DEVELOPMENT, TECHNOLOGY, AND INNOVATION Planning Committee Chair: Department of Science and Technology Member Agencies: Department of Environment and Natural Resources Office of the President Department of Budget and Management Department of Trade and Industry Commission on Higher Education Department of Agriculture Department of Information and Communications Technology Department of Health Department of Interior and Local Government Department of Transportation Department of Foreign Affairs Department of Energy Department of Labor and Employment Department of National Defense Intellectual Property Office of the Philippines Department of Education National Economic and Development Authority Philippine Space Agency CHAPTER 9: PROMOTE TRADE AND INVESTMENTS Planning Committee Chair: Department of Trade and Industry Member Agencies: Department of Agriculture Bangko Sentral ng Pilipinas Department of Foreign Affairs Bureau of Customs Department of Finance Philippine Institute for Development Studies Department of Science and Technology Philippine Statistics Authority Department of Labor and Employment Tariff Commission Department of Information and Communications Technology Securities and Exchange Commission DTI- Bureau of International Trade Relations Export Development Council DTI- Bureau of Import Services National Security Council DTI- Export Marketing Bureau Philippine Space Agency DTI-Bureau of Domestic Trade Promotion National Economic and Development Authority DTI-Strategic Trade Management Office Congressional Policy and Budget Research Department Board of Investments Senate Economic Planning Office Philippine Economic Zone Authority PDP 2023-2028 PDP Organizational Set-up | 427 CHAPTER 10:PROMOTE COMPETITION AND IMPROVE REGULATORY EFFICIENCY Planning Committee Chair: Philippine Competition Commission Member Agencies: Department of Justice - Office for Competition ​  Anti-Red Tape Authority​  Department of Trade and Industry - Consumer Protection Group Governance Commission for GOCCs Government Procurement Policy Board University of the Philippines — College of Law Development Academy of the Philippines Department of Information and Communications Technology Department of Finance​ National Economic and Development Authority CHAPTER 11.1: PROMOTE AND INNOVATIVE, INCLUSIVE, AND HEALTHY FINANCIAL SECTOR Planning Committee Chair: Bangko Sentral ng Pilipinas Member Agencies: Securities and Exchange Commission Philippine Deposit Insurance Commission Philippine Statistics Authority Department of Trade and Industry Government Service Insurance System​ Development Bank of the Philippines Cooperative Development Authority DOF – PhilGuarantee​  Land Bank of the Philippines Overseas Filipino Bank DTI - Small Business Corporation​  Department of Finance SEC - Microfinance NGO Regulatory Council​  Home Development Mutual Fund or Pag-IBIG Fund​  Social Security System National Anti-Poverty Commission Insurance Commission CHAPTER 11.2: ENSURE SOUND FISCAL MANAGEMENT AND IMPROVE THE TAX REGIME Planning Committee Chair: Department of Finance Member Agencies: Bureau of the Treasury​  Bureau of Local Government Finance​  Bureau of Customs​  Department of Budget and Management Bureau of Internal Revenue​  National Economic and Development Authority CHAPTER 12: EXPAND AND UPGRADE INFRASTRUCTURE Planning Committee Chair: Department of Public Works and Highways Member Agencies: Office of Executive Secretary​  Department of Transportation Public-Private Partnership Center Department of Energy Department of Trade and Industry Department of Tourism Department of Information and Communications Technology Department of Agriculture Department of Budget and Management Department of Finance 428 | Philippine Development Plan 2023-2028 SUB-PLANNING COMMITTEE ON CONNECTIVITY Chair: Department of Transportation (DOTr) Co-Chair: Department of Transportation (DOTr) Member Agencies: Mactan-Cebu International Airport Authority (MCIAA) Bases Conversion and Development Authority (BCDA) Manila International Airport Authority (MIAA) Civil Aviation Authority of the Philippines (CAAP) Maritime Industry Authority (MARINA) Civil Aeronautics Board (CAB) Metropolitan Manila Development Authority (MMDA) Clark Development Corporation (CDC) Office of Transportation Security (OTS) Cagayan Economic Zone Authority (CEZA) Philippine National Railways (PNR) Philippine Coast Guard (PCG) Clark International Airport Corporation (CIAC) Philippine Economic Zone Authority (PEZA) Cebu Ports Authority (CPA) Philippine Ports Authority (PPA) Department of Agriculture (DA) Poro Point Management Corporation (PPMC) Department of Human Settlements and Urban Development Subic Bay Metropolitan Authority (SBMA) (DHSUD) Toll Regulatory Board (TRB) Davao International Airport Authority (DIAA) University of the Philippines – National Center for Transportation Department of the Interior and Local Government (DILG) Studies (UP-NCTS) Department of Tourism (DOT) University of the Philippines – School of Urban and Regional Planning (UP-SURP) Department of Public Works and Highways (DPWH) National Electrification Administration (NEA) Light Rail Transit Authority (LRTA) National Telecommunications Commission (NTC) Land Transportation Franchising and Regulatory Board (LTFRB) Land Transportation Office (LTO) SUB-PLANNING COMMITTEE ON ENERGY Chair: Department of Energy (DOE) Co-Chair: Department of Finance (DOF) Member Agencies: Energy Regulatory Commission (ERC) Philippine Electricity Market Corporation (PEMC)Philippine National Oil Company (PNOC) Independent Electricity Market Operator of the Philippines (IEMOP) Philippine National Oil Company (PNOC)-Renewables Corporation National Electrification Administration (NEA) Philippine National Oil Company (PNOC)-Exploration Corporation National Grid Corporation of the Philippines (NGCP) Power Sector Assets and Liabilities Management Corporation (PSALM) National Power Corporation (NPC) National Transmission Corporation (TransCo) SUB-PLANNING COMMITTEE ON WATER Chair: National Economic and Development Authority (NEDA) Co-Chair: National Water Resources Board (NWRB) Member Agencies: Department of Agriculture (DA) Department of Public Works and Highways (DPWH) Department of Agriculture (DA) - Bureau of Soils and Water Local Water Utilities Administration (LWUA) Management (DA-BSWM) Metro Manila Development Authority (MMDA) Department of Energy (DOE) Metropolitan Waterworks and Sewerage System (MWSS) Department of Environment and Natural Resources (DENR) National Anti-Poverty Commission (NAPC) Department of Environment and Natural Resources - River Basin National Irrigation Administration (NIA) Control Office (DENR-RBCO) Philippine Association of Water Districts (PAWD) Department of Health (DOH) University of the Philippines - National Hydraulic Research Center Department of Tourism (DOT) (UP-NHRC) Department of Interior and Local Government (DILG) PDP 2023-2028 PDP Organizational Set-up | 429 CHAPTER 13.1: ENSURE PEACE AND SECURITY Planning Committee Chair: Department of Defense Member Agencies: National Security Council Commission on Human Rights​  Department of the Interior and Local Government Dangerous Drugs Board​  Department of Information and Communication Technology Anti-Terrorism Council​ - Project Management Center National Coast Watch Council Secretariat​  Philippine Statistics Authority Philippine Center for Transnational Crimes​  Bureau of Fire Protection Office of the Presidential Adviser on Peace, Reconciliation and Unity Armed Forces of the Philippines Philippine National Police​  Philippine Coast Guard Department of Foreign Affairs​  BARMM-Bangsamoro Planning and Development Authority CHAPTER 13.2: ENHANCE ADMINISTRATION OF JUSTICE Planning Committee Chair: Supreme Court of the Philippines Member Agencies: Department of Justice (Co-Chair) Public Attorney’s Office (under DOJ) Department of Interior and Local Government Office for Alternative Dispute Resolution (under DOJ) Commission on Human Rights Philippine National Police (under DILG) Bureau of Jail Management and Penology (under DILG) Dangerous Drugs Board Bureau of Corrections (under DOJ)​  CHAPTER 14: PRACTICE GOOD GOVERNANCE AND IMPROVE BUREAUCRATIC EFFICIENCY Planning Committee Chair: Department of Budget and Management Planning Committee Vice Chair: Department of the Interior and Local Government Member Agencies: Anti-Red Tape Authority Union of Local Authorities Civil Service Commission Resource Agencies: Commission on Audit   Career Executive Service Board Development Academy of the Philippines Commission on Elections Department of Information and Communications Technology House of Representatives Governance Commission for GOCCs Philippine Statistics Authority National Economic and Development Authority Office of the Ombudsman Senate of the Philippines CHAPTER 15: ACCELERATE CLIMATE ACTION AND STRENGTHEN DISASTER RESILIENCE Planning Committee Chair: Department of Environment and Natural Resources Member Agencies: Department of Budget and Management   Securities and Exchange Commission Department of the Interior and Local Government   Department of Labor and Employment   Department of Science and Technology   Department of Human Settlements and Urban Development Philippine Institute for Development Studies   Department of Agriculture   Climate Change Commission   Department of Energy   Philippine Statistics Authority   Department of Tourism   Department of Public Works and Highways Department of Transportation   430 | Philippine Development Plan 2023-2028 Office of Civil Defense   Philippine Space Agency Department of Finance   Insurance Commission   Department of Trade and Industry   Senate Economic Planning Office Bangko Sentral ng Pilipinas   Congressional Policy and Budget Research Department PLANNING COMMITTEE ON CULTURE AND VALUES Planning Committee Chair:National Commission on Culture and Arts Member Agencies: Commission on Higher Education National Commission on Indigenous People Department of Education National Commission on Muslim Filipinos Department of Tourism Office of the Press Secretary Department of Trade and Industry - Design Center of the Technical Education Skills and Development Authority Philippines National Economic and Development Authority Film Development Council of the Philippines Movie and Television Review and Classification Board PLANNING COMMITTEE ON GENDER AND DEVELOPMENT Planning Committee Chair: Philippine Commission on Women Member Agencies: Bangko Sentral ng Pilipinas Department of Labor and Employment Department of Agrarian Reform Department of Migrant Workers Department of Agriculture Department of National Defense Department of Education Department of Public Works and Highways Department of Environment and Natural Resources Department of Science and Technology Department of Finance Department of Social Welfare and Development Department of Health Department of Trade and Industry Department of Human Settlements and Urban Development National Economic and Development Authority Department of Justice Philippine Competition Commission PLANNING COMMITTEE ON MIGRATION AND DEVELOPMENT Planning Committee Chair: Department of Migrant Workers Member Agencies: Department of Science and Technology Bangko Sentral ng Pilipinas Professional Regulation Commission Union of Local Authorities of the Philippines Department of Social Welfare and Development Commission on Filipinos Overseas Social Security System Overseas Filipino Bank Technical Education and Skills Development Authority Commission on Higher Education Home Development Mutual Fund Overseas Workers Welfare Administration Department of Trade and Industry Council for the Welfare of Children Department of Health Philippine Commission on Women National Economic and Development Authority Department of Foreign Affairs – Office of Migrant Workers Affairs Department of Interior and Local Government Philippine Health Insurance Corporation Bureau of Immigration Department of Justice – Inter-Agency Council Against Trafficking Philippine Institute for Development Studies Philippine Retirement Authority Philippine Statistics Authority Department of Labor and Employment PDP 2023-2028 PDP Organizational Set-up | 431 TECHNICAL WORKING GROUP (TWG) ON POPULATION AND DEVELOPMENT TWG Chair: Commission on Population and Development Member Agencies: National Economic and Development Authority University of the Philippines Population Institute Philippine Institute of Development Studies United Nations Population Fund Philippine Statistics Authority TECHNICAL WORKING GROUP (TWG) ON CHILDREN’S RIGHTS TWG Chair: Council for the Welfare of Children TWG Co-Chairs: National Economic and Development Authority United Nations Children’s Fund (UNICEF) Member Agencies: National Youth Commission Department of Social Welfare and Development - Juvenile Justice and Welfare Council Early Childhood Care and Development Council National Nutrition Council Department of Social Welfare and Development DBCC SUB-COMMITTEE ON THE SUSTAINABLE DEVELOPMENT GOALS (SC-SDG) Lead Aagency/Chair: National Economic and Development Authority Co-Chair: Department of Budget and Management Member Agencies: Climate Change Commission Department of Transportation Department of Agriculture Department of Social Welfare and Development Department of Agrarian Reform Department of Trade and Industry (DTI) Department of Environment and Natural Resources House of Representatives (HOR) Department of Foreign Affairs National Nutrition Council (NNC) Department of Education Office of Civil Defense (OCD) Department of Human Settlements and Urban Development Philippine Commission on Women (PCW) Department of Information and Communications Technology Philippine Institute for Development Studies (PIDS) Department of Interior and Local Government Office of the Executive Secretary Department of Energy Commission on Population and Development (POPCOM) Department of Finance Philippine Statistics Authority (PSA) Department of Health Philippine Statistical Research and Training Institute (PSRTI) Department of Labor and Employment Senate of the Philippines Department of Science and Technology 432 | Philippine Development Plan 2023-2028 Overall Plan Secretariat Desiree Joy O. Narvaez Ken Aisa G. Ortiz OIC - Director, National Policy and Planning Staff PDP Support Staff Melanie Grace A. Quintos Joshua B. Rabusa OIC - Assistant Director, National Policy and Planning Staff PDP Support Staff Ivee L. Cabading Roni N. Cabrito Chief Economic Development Specialist PDP Intern Rita Angela M. Rivera Loretta T. Arboleda Supervising Economic Development Specialist Administrative Assistant III Maria Antonette D. Pasquin Jezebel L. Estrada Senior Economic Development Specialist Administrative Assistant I Kathleen C. Pilapil EDS II Drafting Team Managing Consultants Research Assistant Clarissa C. David, PhD Gabrielle Ann S. Mendoza Ronald U. Mendoza, PhD PDP Drafting Team/Consultants

2.1 Boost Health Miharu Jay M. Kimwell, MD

2.2 Improve Education and Lifelong Learning Alex B. Brillantes, Jr., PhD

2.3 Establish Livable Communities Susan Rachel G. Jose

3.1 Ensure Food Security and Proper Nutrition Marites M. Tiongco, PhD

3.2 Strengthen Social Protection Fernando T. Aldaba, PhD 4 Increase Income Earning Ability Lawrence B. Dacuycuy, PhD 5 Modernize agriculture and agri-business Eufemio T. Rasco, Jr., PhD 6 Revitalize Industry Francis Mark A. Quimba, PhD 7 Reinvigorate Services Maria Cherry Lyn S. Rodolfo, PhD 8 Advance Research & Development, Technology, and Innovation Napoleon K. Juanillo, Jr., PhD 9 Promote Trade and Investments Annette O. Balaoing-Pelkmans, PhD 10 Promote Competition and Improve Regulatory Efficiency Atty. Jose Gerardo O. Alampay

11.1 Promote an Innovative, Inclusive, and Healthy Financial Sector Engr. Edgar Richard B. Trono

11.2 Ensure sound fiscal management and improve the Tax Regime Milwida M. Guevara, PhD 12 Expand and Upgrade Infrastructure (Transport and Connectivity Arch. Felino ‘Jun’ A. Palafox, Jr. Water Guillermo O. Tabios III, PhD Energy Majah-Leah V. Ravago, PhD

13.1 Ensure Peace and Security Jennifer Santiago-Oreta, PhD

13.2 Enhance Administration of Justice Atty. Mcgyver Doria (Supreme Court) 14 Practice Good Governance and Improve Bureaucratic Efficiency Czarina Corazon M. Medina-Guce 15 Accelerate Climate Action and Strengthen Disaster Resilience Gem B. Castillo, PhD PDP 2023-2028 PDP Organizational Set-up | 433 NEDA Chapter Focals Chapter 2: Promote Human and Social Development Chapter 3.2: Strengthen Social Protection Head: Director Girlie Grace J. Casimiro-Igtiben Head: Director Girlie Grace J. Casimiro-Igtiben OIC - Assistant Director Edgardo S. Aranjuez, II OIC - Assistant Director Edgardo S. Aranjuez, II Susan M. Carandang Loida G. Panopio Yuko Lisette R. Domingo April M. Mendoza Xarina Dominique V. David John Anthony U. Geronimo Michael Dominic Z. Padlan Yuri M. Leomo Christine Joy O. Mamuyac Marie Elaine A. Ceralde Jhoanne O. Mahilum Amabelle C. Quendangan Subchapter 2.1: Boost Health Juan Antonio N. Deleña Head: Director Girlie Grace J. Casimiro-Igtiben Chapter 4: Increase Income Earning Ability OIC - Assistant Director Edgardo S. Aranjuez, II Tomasito P. Javate Jr. Head: OIC - Director Desiree Joy O. Narvaez Maurene Ann D. Papa Ivee L. Cabading Camille F. Rivera-Argana Rita Angela M. Rivera Dorothy Camille M. Detabali Maria Antonette D. Pasquin Celso S. Villaluz Ron James D. Ortiz Chapter 5: Modernize Agriculture and Agribusines Brian Richard G. Diaz Sarah Mae M. De Castro Head: Director Nieva T. Natural OIC - Assistant Director Rory Jay S. Dacumos Subchapter 2.2: Improve Education and Lifelong Ralph Camelo E. Mariano Learning Alvin Caezar V. Olanday Rodolfo S. De Gracia, Jr. Head: Director Girlie Grace J. Casimiro-Igtiben Jane Desiree F. Andal OIC - Assistant Director Edgardo S. Aranjuez, II Hazel Ann L. Alforja Susan M. Carandang Mari Fei C. Lagmay Yuko Lisette R. Domingo Xarina Dominique V. David Chapter 6: Revitalize Industry Michael Dominic Z. Padlan Christine Joy O. Mamuyac Head: Director Bien A. Ganapin Assistant Director Richard Emerson D. Ballester Subchapter 2.3: Establish Livable Communities Estrella R. Turingan Antonio Jose G. Leuterio Head: Director Girlie Grace J. Casimiro-Igtiben Zara Fiel O. Sibulo OIC - Assistant Director Edgardo S. Aranjuez, II Kevin M. Godoy Chapter 7: Reinvigorate Services Aretha Janin O. Garcia Dianne Jade D. Calay Head: Director Bien A. Ganapin Mary Jane M. Dela Rosa Ma. Millicent Joy N. Urgel Julius A. Casabal Rodelyn L. Rodillas Carygine V. Isaac Roald Ray B. Taperla Chapter 8: Advance Research and Development, Mark Angelo V. Cagampan Technology, and Innovation Likha Malai C. Alcantara Rosauro L. De Leon Head: OIC - Director Diane Gail Maharjan William G. Sese Mar Jovette B. Laureta Maria Eunice M. Gonzales Katrina Beatrice M. Atienza Maria Genelin L. Licos Cheska R. Espino Kevin Gilbert M. Manzano Finella Jianna A. Villaluz Chapter 9: Promote Trade and Investments Chapter 3.1: Ensure Food Security and Proper Head: Director Bien A. Ganapin Nutrition Asst. Director Richard Emerson D. Ballester Ma. Cecilia Angela D. Labadan Head: Director Nieva T. Natural Laura P. Lopez OIC - Assistant Director Rory Jay S. Dacumos Edward Martin B. Macasadia Eunice Chloe V. Calura Pocholo Luis S. Tolentino Mary Grace C. Lapurga Esther O. Kinuta Jillian Kazumi V. Ipac Vanessa M. Candido Reichelle C. Celorico Johnmark Gabriel G. Auza Dorothy D. Bantasan Ma. Millicent Joy N. Urgel John Kenneth V. Casabal Madelaine P. Monteramos Director Girlie Grace J. Casimiro-Igtiben OIC - Assistant Director Edgardo S. Aranjuez, II Dorothy Camille M. Detabali Jhoanne O. Mahilum 434 | Philippine Development Plan 2023-2028 Chapter 10: Promote Competition and Improve Chapter 13.1: Attain Peace and Security Regulatory Efficiency Head: Director Remedios S. Endencia Head: OIC - Director Reverie Pure G. Sapaen Asst. Director Cynthia A. Villena OIC - Asst. Director Judith V. Gondra Fresita S. Araneta Joy J. Divinagracia Mark E. De las Alas Karen M. Resurreccion Marie Antonette T. Matibag Janice G. Utanes Nicollo Veo Alejandro M. Aragon Chapter 11.1: Promote and Innovative, Inclusive, and Chapter 13.2: Enhance Administration of Justice Healthy Financial Sector Head: OIC - Director Reverie Pure G. Sapaen Head: OIC - Director Desiree Joy O. Narvaez OIC - Asst. Director Judith V. Gondra Generose B. Manlangit Joy J. Divinagracia David Carlo C. Mangalindan Karen M. Resurreccion Gretchen Leah A. Montejo Rod Norbert D. Mondoyo Chapter 11.2: Ensure Sound Fiscal Management and Chapter 14: Practice Good Governance and Improve Improve the Tax Regime Bureaucratic Efficiency Head: OIC - Director Desiree Joy O. Narvaez Head: OIC - Director Reverie Pure G. Sapaen Rachel Lynn Y. Belandres OIC Asst. Director Judith V. Gondra Rachelle Angela C. Ramos Mariane Genelou S. Reyes Irene Angela V. Cuya Maria Angelica U. Sarinas David Feliks M. Bunao Alfee Rei L. Galapon Chapter 12: Expand and Upgrade Infrastructure Chapter 15: Accelerate Climate Action and Strengthen Disaster Resilience Heads: Director Kathleen P. Mangune Assistant Director Francis Bryan C. Coballes Head: Director Nieva T. Natural OIC - Assistant Director Rory Jay S. Dacumos Physical Connectivity Roald Ray B. Taperla Criselle S. Santos Carygine V. Isaac Art Reagan M. Jarin Lara Gianna V. Hidalgo Luelle Renee C. Jingco Mark Angelo V. Cagampan Marian Mae L. Mellizas Julius A. Casabal Charlene Chris R. Morales Mary Jane M. Dela Rosa Danela R. De Vera Mary Descery Joy B. Bongcac Marina Irene Karana N. Ferrer Likha Malai C. Alcantara Vincent T. Malayao Jessa Danica Villa L. Agcopra Rafael Angelo G. Samson Dominic E. Andrada Patricia Celine C. Ordonio Jowell Angelo A. Banda Deniece Ryanna D. Del Rio John Michael M. Cornito Althea Flokae C. Dam-mit Chapter 16: Plan Implementation, Monitoring, and Digital Connectivity Evaluation Mary Ash Day O. Malimit Reychiel L. Roxas-Lentiyas Heads: OIC - Director Aldwin U. Urbina Melorie DG. Lim OIC - Director Desiree Joy O. Narvaez Fritz Kyle P. Licos Eric B. Rañola OIC - Assistant Director Paul Andrew M. Tatlonghari Christian Leny G. Hernandez Water Resources Karla Victoria S. Laqui Geraldine B. Bayot Mark Justine B. Gatdula Jeremy John G. Borlongan Raymond Paul G. Pineda Nathania Rae Z. Cortes Dave Paulo G. Zornosa Planning Committee on Migration Fernando Victor A. Manicad III Arianne Rose A. Santos Head: Director Girlie Grace J. Casimiro-Igtiben OIC - Assistant Director Edgardo S. Aranjuez, II Energy Loida G. Panopio Edgar A. Basilio April M. Mendoza Sheryl A. Borromeo John Anthony U. Geronimo Armando M. Ramirez III Yuri M. Leomo Raymond John C. Go Marie Elaine A. Ceralde Bianca Yllana M. Dela Cruz Jhoanne O. Mahilum Amabelle C. Quendangan Social Infrastructure Juan Antonio N. Deleña Maria Genelin L. Licos Kevin Gilbert M. Manzano GIlbert V. Kintanar Finella Jianna A. Villaluz PDP 2023-2028 PDP Organizational Set-up | 435 Planning Committee on Gender and Development Head: Director Girlie Grace J. Casimiro-Igtiben OIC - Assistant Director Edgardo S. Aranjuez, II Kevin M. Godoy Dorothy Camille M. Detabali Arsenia Crisilda Maxinne B. Pepino Planning Committee on Culture Head: OIC - Director Reverie Pure G. Sapaen OIC - Assistant Director Judith V. Gondra Maureen Jane B. Oreiro Genshen L. Espedido Maria Adela T. Maputi Krishia Nathalie P. Zabala Rochelle Anne P. Tabion Technical Working Group on Children’s Rights Head: Director Girlie Grace J. Casimiro-Igtiben OIC - Assistant Director Edgardo S. Aranjuez, II Tomasito P. Javate Jr. Maurene Ann D. Papa Camille F. Rivera-Argana Dorothy Camille M. Detabali Celso S. Villaluz Ron James D. Ortiz Brian Richard G. Diaz Sarah Mae M. De Castro Technical Working Group on Population and Development Head: Director Girlie Grace J. Casimiro-Igtiben OIC - Assistant Director Edgardo S. Aranjuez, II Loida G. Panopio April M. Mendoza John Anthony U. Geronimo Yuri M. Leomo Marie Elaine A. Ceralde Jhoanne O. Mahilum Amabelle C. Quendangan Juan Antonio N. Deleña DBCC Sub-Committee on the Sustainable Development Goals (SC-SDG) Head: OIC - Director Atty. Reverie Pure G. Sapaen OIC - Assitant Director Judith V. Gondra OIC - Division Chief Maureen Jane B. Oreiro Rochelle Anne P. Tabion Krishia Nathalie P. Zabala Genshen L. Espedido Maria Adela T. Maputi Rocelle Angel M. Vallente 436 | Philippine Development Plan 2023-2028 Editorial Team Rosemarie G. Edillon, PhD Undersecretary, Policy and Planning Group Sarah Lynne S. Daway-Ducanes, PhD Assistant Secretary, Policy and Planning Group Carlos Bernardo O. Abad Santos Undersecretary, Regional Development Group Reynaldo R. Cancio Supervising Officer, Policy and Planning Group Joseph J. Capuno, PhD Undersecretary, Investment Programming Group Production Team Nerrisa T. Esguerra Frances Fatima M. Cabana Director IV Director III Production Editors Graphics, Design, and Layout Ramon P. Logoc Charina I. Quiwa Cherie Anne R. Quirante Raissa P. Angeles Clarissa E. Escasinas Erik Miguel D. Aguilar Paul Cyril D. Torrente Nikki B. Guevarra Jhon Marvin R. Surio Pauline Therese B. Quilala Liezel M. Aldiano Jana Thalia C. Alano Louise O. Garcia Robert James T. Rodelas Technical Editors Cherry Lynn T. Zafaralla Geralyn A. Rigor Regine Joy E. Javier PDP 2023-2028 PDP Organizational Set-up | 437