November 22, 2018

MANILA—The Philippines’ new poverty index that complements the existing income-based poverty measurement, will help improve the design of development programs of the government, the National Economic and Development Authority (NEDA) said.

“We congratulate the Philippine Statistics Authority (PSA) for developing the multi-dimensional poverty statistics and releasing the results last week. This will greatly help the government gain a full understanding of the extent of poverty that Filipinos experience. The multidimensional poverty index (MPI) will likewise help shape our poverty-reduction efforts,” Socioeconomic Planning Secretary Ernesto M. Pernia said.

MPI, which has already been adopted by several countries in the world, captures the multiple deprivations that each person experiences, in relation to education, health, and living standards.

“While there is a strong correlation between income and quality of life, there are other aspects of poverty that income does not reflect,” Pernia said.

In its initial methodology, PSA, an attached agency of NEDA, identified 13 indicators across the following four dimensions namely: education; health and nutrition; housing, water and sanitation; and, employment.

PSA said one is “multidimensionally deprived” or poor if he or she is deprived in at least one third or four of the 13 indicators. Results of the PSA survey show that multidimensionally deprived Filipinos—or the proportion of Filipinos deprived in at least four out of the 13 indicators—were estimated at 23.9 percent in 2016 and 17.3 percent in 2017.

“Not only do we now know if a family is poor, but also the aspect of quality of life in which they are suffering the most deprivation from, and in response, the intervention that is most needed,” Pernia said.

The Education dimension’s share in MPI was at 36.5 percent and 36.9 percent in 2016 and 2017, respectively. It was followed by the Health and Nutrition dimension with a contribution of 26.2 percent in 2016 and 27.5 percent in 2017. The share of Housing, Water and Sanitation in MPI was 26.4 percent in 2016 and 27.4 percent in 2017. Employment dimension, on the other hand, had the least share in MPI at 10.9 in 2016 and 8.3 in 2017.

“Hopefully, PSA will finalize its methodology soon and report on this measure periodically starting next year,” Pernia said.

Every three years, PSA conducts the Family Income and Expenditure Survey (FIES), which provides data on family income and expenditures, poverty incidence and the levels of living and income disparities.

Initial results of the 2018 FIES are expected to be released in the first half of 2019.