Poverty Threshold, by Province: Bicol Region, 2006-2007

On the average, cost of living in the urban areas is higher by 29.7 percent than in rural areas. Annual per capita poverty threshold in the rural areas was estimated at P14,066 against P18,247 in urban areas. The disparity in the cost of living between rural and urban areas is highest in Catanduanes where living in the urban areas cost 65.5 percent higher than living in the rural areas. Among provinces, urban areas in Catanduanes have the highest annual per capita poverty threshold reaching P22,841 On the other hand, cost of living in urban areas in Masbate is only 13.3 percent higher than living in the rural areas of the province. Masbate has the lowest urban and rural per capita poverty thresholds.

Considering the current poverty thresholds, a minimum wage¹ earner and lone breadwinner in a family of five in urban areas of the region will be P2,262.92 short to meet the family’s monthly basic needs. On the other hand, a lone breadwinner in the rural area earning P168/day and supporting four other persons needs at least P195.36 daily or a monthly deficit of P820.83 to meet their most basic needs.

The 2006 and 2007 preliminary poverty threshold estimates are based on the latest price data from the National Statistics Office (NSO) and the Bureau of Agricultural Statistics (BAS) and prepared by the National Statistical Coordination Board (NSCB), which is mandated to regularly generate and release the country’s official poverty statistics at the national, regional, and provincial levels. The estimates are considered valuable for targeting and planning purposes like determining minimum wage, negotiating for collective bargaining agreements (CBAs), identifying beneficiaries of government programs, etc. Consistent with its thrust of providing relevant, timely and accurate poverty statistics, a model-based methodology of estimating food and poverty thresholds was formulated by NSCB and approved by its Executive Board on 14 February 2007. This methodology will compute for advance estimates of food and poverty thresholds even before price data for the reference year are made available by the NSO and BAS.

The model-based methodology went through open and rigorous process of evaluation, refinements, and revalidation through a series of interagency discussions and consultations with the Technical Committee on Poverty Statistics – the body tasked to study the methodologies and estimation procedures used in generating official poverty statistics and related indicators.

Given the limitations of the methodology and its data constraints, the estimates will still be subject to further improvements and refinements as more data inputs become available. As approved by the NSCB Executive Board, model-based thresholds are to be generated for both FIES² and non-FIES years. After the release of preliminary model-based estimates in December preceding each reference year, continuous improvement on the model-based estimation methodology is to be undertaken as more data become available.

With this updated model, estimates of thresholds are to be revised for non-FIES years. Final estimates for 2006, when the FIES was also conducted, will be released in May 2007 using actual price data from the NSO and the BAS. The final (model-based) estimates for 2007 are scheduled for release after the review of the methodology in May 2010. The menu-based thresholds will be used in the computation of other poverty statistics, which include poverty and subsistence incidences (during FIES years), and other measures of poverty such as income and poverty gaps, and severity of poverty indices. (For more details on the methodology please visit www.nscb.gov.ph/technotes/poverty_tech2007.asp)

¹  Prescribed Daily Minimum Wage for non-plantation agricultural workers is P178.00 for the cities of Naga, Legazpi, Iriga and Tabaco and the municipalities of Daraga and Pili, and P168.00 for all other areas in the region per Wage Order No RB 05-11 issued on July 17, 2006.
²  Family Income and Expenditures Survey conducted by the National Statistics Office every three years.

Source of basic data: National Statistical Coordination Board

Date posted: May 16, 2007