Poverty Statistics

Republic Act No. 8425 of 1997, which spelled out the Philippine Government’s Social Reform Agenda (SRA), states that poverty takes many forms of deprivation of basic needs, including deprivation in health, food and nutrition, water, shelter and decent housing, education, among others.

Further, the law provides for the official definition of poverty as the lack of income to afford the minimum basic needs of food, health, education, housing and other essential amenities of life.

As per System of Designated Statistics, the PSA releases the first semester 2018 official poverty statistics based on the FIES 2018 First Visit is a significant milestone in making statistics on welfare and living standards more timely. 

The then Technical Committee on Poverty Statistics (TC PovStat), which was composed of experts on poverty statistics, was tasked with the development/ formulation of the official poverty estimation methodology.

The PSA Technical Staff is in charge with the compilation and estimation of the official poverty statistics based on the approved methodology.

FOOD THRESHOLD

  • Refers to the minimum income required for a family/ individual to meet the basic food needs, which satisfies the nutritional requirements for economically necessary and socially desirable physical activities

  • Also referred to as the subsistence threshold or the food poverty line

  • These food thresholds represent the cost of a bundle of food items that are considered minimum and satisfy the nutritional requirements set by the Food and Nutrition Research Institute (FNRI), while remaining economically and socially productive.

The Food Threshold is then divided by the FE/TBE Ratio to account for the cost of the basic non-food needs.

  • The official approach in the Philippines for estimating the non-food component of the poverty threshold involves estimating the average share of food expenditure of families around the food poverty threshold, and subsequently taking the ratio of the food threshold to this food share to obtain the poverty threshold.

  • Based on the FIES results in 2000, 2003, 2006 and 2009, the average percentage of food expenditure to the total basic expenditure of the families around the subsistence incidence for these 4 FIES surveys is  69.83 percent.  Using this ratio, the total poverty threshold is estimated by dividing the food threshold with this ratio, i.e., FT/0.6983.

  • Basic Non-Food Requirement includes: 1) clothing and footwear; 2) fuel, light and water; 3) housing maintenance and other minor repairs; 4) rental of occupied dwelling units; 5) medical care; 6) education; 7) transportation & communication; 8) non-durable furnishing; 9) household operations and 10) personal care and effects