Follow-Up on the Performance Audit on the Pantawid Pamilyang Pilipino Program

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Follow-up on the Performance Audit on the Pantawid Pamilyang Pilipino Program (PAO-2022-02)

Success in Poverty Reduction from 4Ps Has to be Critically Examined: 90% of the4.3 Million Household-Beneficiaries Continuously Received Grants for a Long Period of Time Without Indication of Being Uplifted from Poverty Line

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Date added: October 4, 2022

What COA Found

In the 2017 performance audit, we recommended the conduct of an impact evaluation focusing on the program’s effects on poverty alleviation. DSWD complied with this recommendation and secured the services of the Philippine Institute for Development Studies (PIDS) to implement the same. The results of the evaluation indicate that the program shows desirable impacts on most of the target education and health outcomes of children and pregnant women. However, the study was not able to touch on the direct correlation of the program with the decrease of poverty incidence in the country. We raised this issue in view of the significance of the amount allocated to 4Ps wherein from CYs 2008–2021, the program received a total amount of ₱780.71 billion.

As an alternative, in this follow-up, we looked into the relevant data and found that about 3,820,012 or 90% of the 4,262,439 active household-beneficiaries have been with the program for seven to 13 years with a total of ₱537.39 billion cash grants given as at June 30, 2021. This means that 90% of the active household-beneficiaries remained below poverty threshold even after being in the program for a long period of time.

This is particularly important because of the enactment of the 4Ps Act, which limits the stay of beneficiaries to seven years. Under this law, the DSWD will delist a beneficiary from the program after reaching the end of their seventh year, regardless of whether or not they have crossed the poverty threshold. Pursuant to the implementing rules and regulations, the implementation of this provision will be prospective, hence the counting of the seven-year limit will start from Calendar Year (CY) 2020 or upon entry of the beneficiary to the program, whichever is later.

Consequently, this seven-year rule may affect the chances of the student-beneficiaries to complete their high school education. As at March 2020, about 2.6 million or 33% of 4Ps student-beneficiaries were still below Grade 6. Applying this limit, essentially about 2.6 million students will no longer receive financial support from the program by CY 2026.

Nonetheless, the 4Ps Act reinforces our recommendation on the need to hasten the completion of the National Household Assessment and IT upgrades wherein currently, there were challenges confronting the DSWD in updating its list of poor households and IT systems. The Listahanan 3, which should be the latest update of the list of poor households was delayed by three years and was only launched on August 1, 2022, while the Pantawid Pamilya Information System version 3 or the latest version of the IT system was not yet fully operational. With the 4Ps Act already in place, by CY 2026 almost all active beneficiaries will be delisted from the program, hence the Listahanan and the IT systems need to be updated and ensure controls are working effectively to cater for the new beneficiaries.

 

Why COA did this study

In 2017, the Performance Audit Office of the Commission on Audit (COA) conducted an audit on the Pantawid Pamilyang Pilipino Program (4Ps) wherein a total of seven audit recommendations were issued to the Department of Social Welfare and Development (DSWD) to assist in its reporting on the program’s impact and in addressing the concerns on targeting and data accuracy and reliability.

Pursuant to international standards, COA shall perform follow-up activities to examine the corrective action taken by the audited entity on the basis of the results of a performance audit.

Thus, the implementation of recommendations on the audit of 4Ps has been subjected to follow-up audit to evaluate the extent to which: (1) the audited agency implemented the recommendations and whether the actions taken were appropriate in response to the audit findings and recommendations; and (2) the implementation/non-implementation of the audit recommendations impacts on the program and its beneficiaries. The scope of the audit covered the implementation of DSWD’s action plans on audit recommendations from January 2017 to June 2021.

We also considered prevailing circumstances or conditions that significantly affected the implementation of the program, such as the enactment of Republic Act No. 11310 or the 4Ps Act on April 17, 2019.

 

What COA recommends

COA recommends to the DSWD to fast-track its data cleansing and complete the Information Technology (IT) Systems upgrade, pursuant to its Information Systems Strategic Plan. Regularly conduct the National Household Assessment pursuant to 4Ps Act.

COA also recommends that DSWD shall report on the program’s status on poverty alleviation, consistent with Section 17 of the 4Ps Act.

For a complete discussion of the findings and recommendations of the previous audit, please access the report at https://www.coa.gov.ph/reports/performance-audit-reports/2017-2/pantawid-pamilyang-pilipino-program/