NSCB - For the Record - On poverty thresholds and income

This note seeks to clarify a few points mentioned in the newspaper article on “Poverty Gap Must be Addressed”, that appeared in the 20 February 2007 issue of Standard Express, resulting from the NSCB’s press release last 15 February 2007 entitled “Metro Manila families needed P 7,854 per month in 2005 to keep out of poverty”.

Standard Express Statement:

“According to Senator Vicente “Tito” Sotto, “based on this statistics in a family of five, a sole breadwinner should earn P259 per day so that they can make ends meet. For such amount, the allocation would be approximately P154 for food and P105 for other needs.

However, the per capita income of Filipinos is pegged at $1,463. This translates to a monthly income of only P6,475.

Based on these figures, there is a great discrepancy between what the people are earning and their needs. What we need to focus on is how to eliminate this gap,” says Sotto.”

NSCB Clarification:

On poverty thresholds and income

What Senator Tito Sotto cited refers to the 2005 daily poverty threshold for a family of five residing in the National Capital Region as reflected in the NSCB Press Release on “Metro Manila families needed P7,854 per month in 2005 to keep out of poverty” posted on the NSCB website on 15 February 2007.

(http://www.nscb.gov.ph/pressreleases/2007/Feb14_PR-200702-SS1-01_Pov.asp)¹

This was then compared with the forecasted 2006 monthly per capita income of $1,463 or P 6,475² released by the National Economic and Development Authority.

Further, per Executive Order No. 352, Designation of Statistical Activities that will Generate Critical Data for Decision-making of the Government and the Private Sector, the official source of income and expenditure data for the country is the National Statistics Office through its triennial Family Income and Expenditure Survey (FIES). The latest results of the FIES on the country’s per capita income, provided figures for 2003, however, in the article, the discussion on the thresholds were for 2005. Thus, to maintain consistency of analysis, thresholds and per capita income used should have been for 2003 (i.e., latest year that data for both are available). The table below shows the nominal and real per capita income as released by the NSO and derived by the NSCB, respectively. It also shows the per capita food and poverty thresholds of the Philippines and NCR for 2003 released by the NSCB on 6 June 2006. These figures were also converted in US$ values using the average annual exchange rate as released by the Bangko Sentral ng Pilipinas, which is the official source of data for the latter.

Annual and monthly nominal and real per capita income, per capita food and poverty thresholds
of the Philippines and NCR, 2003

	Nominal a/ Per Capita Income		Real b/ Per Capita Income		Per Capita Food Threshold c/		Per Capita Poverty Threshold c/
	Annual	Monthly	Annual	Monthly	Annual	Monthly	Annual	Monthly
PHILIPPINES
Peso	30,772.00	2,564.33	28,889.00	2,407.42	8,149.00	679.08	12,309.00	1,025.75
Dollar d/	567.72	47.31	653.69	54.47	150.34	12.53	227.09	18.92

NCR
Peso	58,772.00	4,897.67	55,328.00	4,610.67	9,974.00	831.17	16,737.00	1,394.75
Dollar d/	1,084.29	90.36	1,251.93	104.33	184.01	15.33	308.78	25.73

Notes:
a/ - Based on the FIES conducted by the NSO
b/ - Real per capita income for 2003 was derived by the NSCB by deflating each family’s 2003 nominal per capita income by the provincial implicit price index, which in turn was computed by dividing the 2003 provincial poverty threshold by the 2000 provincial poverty threshold. A more detailed explanation/notes on the computation of real per capita income is provided in http://www.nscb.gov.ph/poverty/2003/notes/notesB.asp
c/ - Source: NSCB
d/ The dollar value of the nominal per capita income, per capita food threshold, and per capita poverty threshold were computed using the average annual exchange rate for 2003 while the rate for 2000 was used in adjusting real per capita income. (Source: BSP)

The NSCB would like to thank Standard Express for their interest in statistics and for its contribution in the dissemination of official statistics. For inquiries, please contact Ms. Jessamyn O. Encarnacion or Ms. Kristine Faith S. Agtarap at telephone number +632-8965390 or through e-mail addresses jo.encarnacion@nscb.gov.ph and kfs.agtarap@nscb.gov.ph.

¹Note: The NSCB would like to add that the 2006-2007 official provincial food and poverty thresholds was recently released last 2 March 2007.

²Source: http://newsinfo.inquirer.net/inquirerheadlines/nation/view_article.php?article_id=22705

posted 04 April 2007.