| Technical
Notes: Poverty Statistics
Data for analysis on poverty were drawn mainly
from the Family Income and Expenditure Survey (FIES) of the
National Statistics Office (NSO). From the results of the
FIES, the Population, Income and Employment Division (PIED)
and Health, Education and Social Welfare Division (HESWD)
of the NSCB came up with a different analytical format of
the poverty statistics generated from tables prepared by the
Technical Working Group on Income Statistics under the Inter-Agency
Committee on Labor, Income and Productivity Statistics (IAC-LIPS)
created by the National Statistical Coordination Board (NSCB).
Determination of Low Cost Diets by
Region, Urban-Rural
Low cost diets on a per capita basis are
constructed for the regions of the country, subdivided into
rural and urban. One-day sample menus for each urban/rural
area of a region are provided by the FNRI taking into consideration
the nutrient requirements, food commonly eaten in the areas,
and the generally cheap foods. These menus, however, are for
purposes of estimating the food threshold and not to be seen
as prescribed menus. It is further stressed that these menus,
being based on per capita RDA, are generally applicable to
the average healthy Filipino performing moderate activities.
Nutritional Requirements
The dietary goal of the menu plans is to
meet 100% of the per capita Recommended Dietary Allowances
(RDA) for energy and protein and 80% of the per capita RDA
for vitamins, minerals and other nutrients. The RDA for energy
is 2,000 calories.
Food Commonly Eaten in the Area
The menus are typical of a Filipino diet
and representative of the region. The typical Filipino pattern
is composed of three meals and one snack and usual food combinations
are followed, like having rice with a viand. Variation in
food preference across regions has been reflected in the menus.
The consumption patterns are based on the results of the latest
Food Consumption Survey of FNRI.
Cheap Foods
The term "low cost" implies the
utilization of cheap foods for the construction of the sample
menus. Thus, nutritionally economical foods are considered
to comprise the menu. This means that an additional quantity
of such food items entails comparatively lower cost but has
the same nutritional contribution as the other more costly
foods.
On the other hand, some foods, although a
little more costly, are included in the menu because they
are the only source of the nutrient required. Further, to
determine the low cost commodities, data from the Bureau of
Agricultural Statistics and the Food Management Section of
the FNRI are used. The ingredients of the respective menus
are listed in weights (grams) based on an individual's intake.
The nutrient content is calculated and compared
to the requirement. In cases where the 100% and 80% adequacy
for specific nutrients are not met, the quantity of the foods
to be served is increased in order that the nutrient requirement
is realized. A process of validation with regional specialists
as well as members of the Technical Working Group is done
before the menu is finalized.
Determination of Own-Produced Components
For the purpose of costing the menus, the
proportion of food bought and not bought are determined. These
are based on the results of the National Nutrition Survey
of the Philippines conducted by the FNRI.
Derivation of Costs
The menus are valued using average actual
prices, but applying different prices for the bought and not
bought components. For the bought component, the following
sets of prices are used:
a) NSO Retail prices in
Metro Manila for NCR;
b) the composite prices derived from the
NSO urban provincial retail prices for urban regions outside
NCR; and
c) prices paid by farmers for rural regions
outside NCR as gathered by BAS.
For the own-produced commodities, prices
received by farmers as gathered by BAS are used in cases where
price data are available. In cases where data are not available,
a price value is computed based on the price of more or less
similar commodities and/on the average value of commodities
for which price data are available.
To get the price per commodity, the required
weight of the food in edible portion is converted into its
"as purchased" (AP) equivalent. Price per commodity
is then applied as follows;
(Wtf) x (Br)x(Ppc)
+ (Wtf) x(Or)x(Poc)
where: Wtf = Total required
weight of food item; Br = Proportion of bought;
Ppc = Price per unit of purchased commodity; Or = Proportion
of own produced
Poc = Price per unit of own-produced commodity
The total cost of the food menu (in terms
of peso per day per capita) is then computed by aggregating
the costs per commodity.
Computation of Food Threshold
The per capita per day food cost is multiplied
by 30.4 (approximate number of days per month) to get the
monthly food threshold or by 365 days (30.4 days/month x 12
months) to get the annual food threshold.
The monthly/annual food threshold derived
is thus interpreted as the subsistence threshold - the monthly/annual
income necessary to meet nutritional requirements.
Subsistence Incidence
The subsistence incidence is measured by
determining the number of families with per capita annual
income below the food threshold. The per capita annual income
of each sample household in the Family Income and Expenditure
Survey is compared to the food threshold to determine whether
it is above or below the threshold. The magnitude of sample
families determined to be poor are then blown up by the appropriate
raising factor of the survey.
Poverty Threshold
In order to estimate the total poverty threshold
(food plus non-food basic needs), the food threshold is divided
by the proportion of the food expenditures (FE) to total basic
expenditures (TBE) derived from the latest FIES using the
FE/TBE's of families within the +/- 10 percentile of the food
threshold.
TBE is the aggregate of expenditures on food;
clothing and footwear; fuel, light and water; housing maintenance
and other minor repairs; rental or occupied dwelling units;
medical care; education; transportation and communications;
non-durable furnishings; household operations and personal
care and effects.
The proportion used is derived from patterns
of expenditures of families/individuals whose annual per capita
income falls below the annual per capita food threshold.
Poverty thresholds are computed for each
region, on an urban/rural basis. The poverty threshold for
the region is the weighted average of urban/rural thresholds.
Threshold for areas outside NCR is the weighted average of
thresholds of all regions outside NCR, on an urban/rural basis.
The threshold for the national level is estimated
as the weighted average of the NCR and areas outside NCR,
disaggregated by urbanity. The weights used are based on the
population size in each survey round, i.e., 1985 to 1997 rounds,
of the FIES.
Poverty Incidence
To get the magnitude of poverty, the per
capita annual income of each sample family of the FIES is
computed and compared to the respective annual per capita
poverty threshold of the region (urban/rural) where the sample
family resides. Those with incomes below or above the poverty
threshold are identified.
The number of sample families falling below
the poverty threshold is blown up to estimate the total number
of poor families. For each region/urban-rural area, appropriate
raising factors are used depending on the sampling fractions
used by the NSO in their survey.
The number of families below the poverty
threshold at the national level is determined by adding the
number of families below the poverty threshold for each region,
urban and rural.
The incidence of poverty (head count index)
is computed by getting the percentage of the number of families
below the poverty threshold to the total number of families.
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