Action 3.3 Ensure budget for statistical development

12. 
    Apart from operations, the budget for statistical development also needs to be ensured. It is recommended that the government appropriates an adequate budget for statistical development that will enable the statistical agencies to fund improvements in their products or develop new products. In the 1990s, some statistical agencies, such as NSCB, received some P3 million a year as “grant in aid.” However, in the last decade, this budget item has not been provided. As an alternative, major statistical agencies have resorted to donor agencies to fund the development of new statistics (such as the SAE, the informal sector survey, and the rebasing of the national accounts) or to supplement their need for training and computers. Based on recent needs of the major statistical agencies, it is estimated that around P5 million to P10 million per year for each major statistical agency would be an adequate amount to start with for statistical development.
    

12. 
    To solve the depletion of human capital in the PSS, one recommendation is to reverse the present pyramid structure in the statistical agencies. In NSO for example, the number of low ranking staff could be reduced by about 10 percent (in large part due to the computerization of many processes and the emergence of better ways to capture responses, such as via the internet), while the number of senior statisticians can be quadrupled to improve the analytical capacity of NSO to produce better data. This reorganization should be reflected in a realistic rationalization plan. This should also include a succession plan to ensure that in the long-term, statistical agencies remain adequately staffed with competent leads. This would also help institutionalize projects which are having difficulty in integrating into the regular work program of statistical agencies because of the lack of qualified staff despite the availability of financial resources.⁰ Consideration can be given to improving the remuneration of senior statisticians by putting them in higher salary grades if the statistical agencies cannot operate outside the civil service law. More generous graduate scholarships can also be provided as staff incentives but in exchange for longer scholarship bonds, such as a minimum of two years of PSS service for every year of study.
    

12. 
    With adequate resources, priority can next be given to improving the quality and usefulness of key designated statistics. Statistical concepts, definitions, and classifications used by various statistical agencies need to adhere to internationally-agreed standards at all levels and should be measured consistently across various statistical agencies. Correctly measuring key indicators and ensuring their consistency, such as the growth rates in production and poverty incidences, have important implications on the direction of policies the government takes. For example, incorrectly measured agricultural production indicators disguised an impending food shortage in Malawi, delaying appropriate response to the 2002 food crisis (World Bank 2002). In contrast, accurate and timely data in Tanzania led to better targeting of health programs and a positive impact on human development. In the Philippines, municipal level poverty estimates enabled the government to improve targeting of some of its biggest social assistance programs, such as the CCT program.
    

12. 
    As the country’s premiere statistics, priority should be given to the compilation of the national accounts by enacting a policy recognizing national accounts compilers as the primary users of economic statistics and aligning all economic surveys/censuses to meet its needs. This may entail amending the present mandate of NSO to provide general purpose statistics to one that prioritizes national income compilers over and above the needs of the general public.^{0 0} As a priority area, budgetary support should be provided to ensure that the NSCB and NSO have adequate resources to continuously improve the PSNA. To date, most of the resources have come from various donor agencies. While this alleviates the problem in the short-term, full budgetary support is needed to ensure long-term gains and ownership in this area.
    

12. 
    To generate more timely and disaggregated statistics, the current set of household surveys need to be improved. This requires (i) providing a more coherent framework for the implementation of household surveys, (ii) speeding up the processing time of results, (iii) minimizing the response burden, (iv) providing for provincial representation, and (v) producing annual poverty estimates. More specifically, the following are suggested:
    

• 
  Ensure that basic socio-economic indicators are captured in the household surveys (i.e., LFS, FIES, and APIS) and censuses to be more relevant to policy makers. For this to happen, a comprehensive review of the various household survey modules needs to be undertaken immediately, taking stock of user needs versus data gaps and re-engineering the design of pertinent household surveys.
  

• 
  Ensure that the next master sample of households has provinces as a domain. In addition, the urban and rural classification should be restored in the household surveys.
  

• 
  Redesign the FIES to improve the response rate and shorten the time needed to release the results. A study by Fuwa (2007) showed that the second round does not add value to the FIES since the difference between the first and second round is statistically insignificant. The Living Standard Measurement Survey (LSMS), in particular its modular approach, could be used as a guide in redesigning the FIES. This should also be done with a view to increasing the frequency of releasing poverty estimates.
  

• 
  Ensure that the LFS and FIES always form a panel of households to track the dynamics of poverty.
  

• 
  Produce municipal level poverty statistics following the methodology for small area estimation every three years.
  

12. 
    By re-engineering the FIES and allocating the right amount of resources, timeliness in the release of poverty estimates can be improved from the current 24 months after the reference year to at most 12 months. To ensure the timely release of statistics, the list of designated statistics should be updated to reflect these changes. Moreover, a performance contract could be used to ensure that statistical agencies produce the required data with the resources given to them. This should put the Philippines on a par with countries such as Vietnam and Cambodia in terms of the timely release of poverty statistics.⁰
    

Rashiel Velarde (EASHS)

Corpuz, O. (1997) “An Economic History of the Philippines.” University of the Philippines

Press.
Fuwa, N. (2007) “A Methodology for Predicting Annual Income and Expenditure Given One

Round of the Family Income and Expenditure Survey (FIES).” Technical Assistance Report to NSO.

Technical Assistance Report to NSCB.

Statistics.”

of the FIES.” University of Los Banos.

Public Spending." Report no. 23095-NI.

1. 
   In the World Bank’s 2008 Global Poll, the Philippines was the only country in East Asia where ‘improving governance’ was identified as the most important means to generate faster growth and mentioned among the top two priority actions for reducing poverty. While many institutions contribute to good governance and development, none are as closely associated with governance and the rule of law as the courts, the prosecution, the police and the corrections system – together the core of a country’s justice system. To become a stronger force for good governance and development, the justice system has to surmount long-standing challenges: (i) reduce delays in the delivery of justice, (ii) mobilize and manage resources – financial, human, physical, and information technology – more efficiently, (iii) reduce barriers in access to justice for the poor and marginalized, and (iv) strengthen public trust and confidence.
   

2. 
   Slow disposal of lower court cases remains the main obstacle to improving the delivery of justice, eliminating case backlogs could take another 25 years at current rates. The pace of disposal is reflected in two key performance indicators for lower courts, where the bulk of the cases reside: the case disposition rate (Figure 1), and the proportion of backlog cases (Figures 2 and 3). First, the overall annual disposition rate⁰ has averaged about 27 per cent for 2005-2008. Second, high-volume lower courts such as Regional Trial Courts (RTCs), Metropolitan Trial Courts (MeTCs) and Municipal Trial Courts (MuTCs) never disposed more than 40 percent of their stock of cases in any year during 2005-2008.
   
   

3. 
   The total volume of cases disposed is declining (Figure 3). Across all lower courts, 282,000 cases were disposed during 2008, down from 340,000 in 2005, a 17 percent reduction. These low disposal rates appear to be caused by a combination of poor courtroom management, adjournments due to judges’ reluctance to use subpoenas and contempt rules to compel adherence to time frames by attorneys and litigants, vacant judgeships and dilapidated/unsafe physical facilities. The 1998 Speedy Trial Act has not been effective in reducing delays.
   

4. 
   Poor enforcement of Barangay Justice System (BJS) awards and settlements has led to case spillovers to regular courts. Since enforcement actions can be politically sensitive, Barangay officials tend to wait out the six-month execution period under section 417 of the “Katarungang Pambarangay law”, after which the parties have to file an enforcement case with the appropriate court: this has added cases to court dockets instead of reducing them.
   

5. 
   The real judicial budget has increased, but its management remains weak, and audits have disclosed persistent issues. The judiciary has been requesting an increase in the share of the judicial budget to about 2 percent of the national budget. Trends show a decreasing proportion in nominal terms - from 1.17 percent in 1998 to 0.88 percent in 2004 and a projected 0.75 percent in 2011. But the real judicial budget increased by 34 percent (Figure 4) between 2004 and 2009. However, the Supreme Court views this as insufficient to address years of under-resourcing, especially for capital outlays and maintenance and operating expenditures (Figure 5). Taking the totality of judicial resources into account – national budget appropriations, the Judiciary Development Fund, and LGU expenditures on lower courts - annual audits by the Commission on Audit have disclosed persistent management and control issues.
   

6. 
   Poor physical facilities in lower courts, prosecution offices and jails perpetuate inefficiency and raise barriers for access to and delivery of justice. These facilities are characterized by (a) poor or unsafe physical conditions, (b) lack of office supplies and furniture, (c) under-resourced operation and maintenance of buildings and equipment, causing inability to pay utility bills and non-availability of basic amenities such as water and sanitation. Chronic under-resourcing has led to lower courts’ reliance on LGUs for office supplies, equipment, maintenance and judges’ allowances, severely compromising judicial independence in actuality. The condition of jails is equally dismal, with poor facilities and overcrowding.
   

7. 
   Inefficient human resource management contributes to systemic inefficiency. Although there is a shortage of judges and prosecutors, there is overstaffing on administrative personnel. The situation has marginally improved in respect of judges (Figure 6): while 29.5 percent of positions were reported vacant in 2005, this figure decreased to 22.7 percent in 2008, though 519 courtrooms still did not have a dedicated judge. A similar shortage of prosecutors and public attorneys has led to high caseloads for individual prosecutors, causing further delays, conflicting schedules, poorly prepared cases and low conviction rates. The average staff-to-judge ratio in lower courts is estimated to be about 12 in 2010.
   

8. 
   Justice ICT infrastructure remains obsolete, fragmented and ineffective despite years of small-scale modernization attempts: as a result, ICT’s enormous potential to improve efficiency and reduce corruption remains unharnessed. Numerous lower courts do not have adequate ICT facilities. And ICT applications to improve case management have mostly been stand-alone attempts to improve small elements of the system (often driven by donor priorities). A judiciary-wide approach is absent. Executive entities suffer from similar problems. For example, the Department of Interior and Local Government (DILG), which oversees prisons, does not yet have basic modern networked information systems for corrections facilities, while the Department of Justice (DOJ), which oversees prosecutors, lacks a basic electronic prosecution case tracking system. The judiciary’s fragmented ICT systems have had little impact on reduction of case backlogs or delays (Figures 1-3). On the executive side, the story is similar. In the DILG, basic information for overseeing prisons is not readily available or accessible, facilitating non-transparent functioning and human rights violations⁰. In the executive and the judiciary, business processes remain cumbersome and mostly manual.
   

9. 
   Delays in case disposal, high cost of litigation, and limited resources in the public attorney’s office create barriers for access to justice for the poor. Access of poor litigants to public attorneys is restricted by eligibility criteria (e.g., threshold income level), a first-come-first-served condition which can exhaust funds, and the geographic spread of the country over more than 7,000 islands causing dispersed court locations and physical barriers to access. In regions like Mindanao, access to justice is further affected by security threats and instances of violence which have led to the resignation of several judges.⁰
   

10. 
    Public trust and confidence in the lower courts, the DOJ and the DILG remains low. For courts, this appears to be due to (a) slow progress on efficiency, anti-corruption⁰ and impartiality⁰ and (b) the resulting ‘image deficit’.⁰ Corruption in courts involving lawyers and judges continues, with functions such as enforcement by sheriffs and transcript preparation by stenographers appearing to be more susceptible.
    

11. 
    Since 2000, the Philippines judiciary, led by the Supreme Court, has implemented its Action Program for Judicial Reform (APJR), focusing on three major themes: (i) reducing case backlogs, increasing the use of alternate dispute resolution (ADR) mechanisms, piloting small claims courts, and modernizing case flow management using IT applications, (ii) enhancing access to justice, and (iii) restoring public trust and credibility. These reforms have been supported by multilateral and bilateral partners.
    

12. 
    The Supreme Court has attempted to identify the reasons for delays, but these initiatives have had limited impact. The Court formed a Committee of Justices in 2006 to suggest practical procedures to achieve zero case backlogs. The Committee held dialogues with judges, clerks of courts, prosecutors and lawyers to promote efficient disposition of cases. These discussions and the 2004 Guidelines on Pre-Trial were expected to shorten court proceedings but did not. The Supreme Court established a pilot Regional Court Administration Office (RCAO) to test decentralization of administrative functions and responsibilities. The practicality of the RCAO concept appears doubtful, given the possibility of more cost-effective decentralization through business process streamlining, automation and ICT-enabled communications capability.
    

13. 
    A more successful approach has introduced summary procedures, providing long-awaited relief to litigants. The Supreme Court rolled out Small Claims Courts (SCC) in all 1,137 first instance courts (except Shari’a courts) after piloting this in 22 selected first instance courts.⁰ These courts are authorized to dispose civil disputes for payment or reimbursement of sums not exceeding P100,000 (approx. US$2,217).⁰
    

14. 
    ADR⁰ is also used to reduce backlogs. The Philippines Judicial Academy (PHILJA) has been implementing the Justice Reform Initiatives Support (JURIS) Project with assistance from the Canadian International Development Agency (CIDA) to deliver training programs and supporting ADR mechanisms. Since 2001 Court Annexed Mediation (CAM) is an alternative to regular judicial processes. The Supreme Court established a Philippines Mediation Centre Office (PMCO) and Mediation Centre Units (MCUs) to systematize recruitment, training, accreditation, and evaluation of mediators, besides adopting special ADR rules that acknowledge new practices and technology.⁰ The Asian Development Bank (ADB) financed a Governance in Justice Sector Reform Program (GJSRP), which includes expanding the delivery of justice through ADR.
    

15. 
    Justice entities have initiated budget reforms, but the pace is slow. The Department of Budget Management (DBM) and the Supreme Court’s Fiscal Management and Budget Office (FMBO) have prepared an Organizational Performance Indicator Framework (OPIF) which specifies the judiciary’s objectives and goals, and defines major final outputs (MFOs). This is a key first step towards integrating strategic planning, budgeting and performance management. However, judicial planning and budgeting capacity is low, and internal controls are not applied consistently: large unliquidated advances persist, often with no consequences for the officials concerned (such as stoppage of salaries until advances are liquidated), trust receipts are not deposited timely to the Bureau of Treasury, and asset verification is not undertaken with consistency and rigor. Slow and cumbersome procurement further limits absorptive capacity and constrains timely resource use⁰. Under the umbrella of the DBM’s budget reform initiatives, the DOJ and the DILG have also moved towards MFOs and performance indicators.
    

16. 
    In 2009 the Supreme Court approved a visionary policy to modernize judicial ICT systems, but internal resistance has stalled implementation. The two complementary pillars of this policy promise to increase efficiency: (i) an Enterprise Information Systems Plan (EISP) for judiciary-wide ICT systems design, financing and implementation, and (ii) a MISO Re-engineering and Development Plan (MRDP) to strengthen capacity⁰. For the first time, the Court has a clear plan to transform its fragmented, obsolete and non-scalable ICT applications into a modern suite of ICT applications. However, a cautionary example of the extent of resistance from entrenched interests is the E-Library, an ‘early win’ application released five years ago at the initiative of the Justices, which made available free of charge, to judges and lawyers, a searchable electronic databank of Supreme Court decisions. Despite user plaudits and demand, MISO resisted upgrading it: the E-Library now languishes, its promise steadily waning.
    

17. 
    Case flow management improvements have been incremental⁰, with limited court coverage, low inter-operability, poor scalability and few O&M resources. For example, the CIDA-assisted “Court Administration and Management Information System” (CAMIS) has led to better management of caseload and case flow information through automated reporting of cases in first and second level courts. Similarly, the World Bank-financed “enhanced Case Flow Management” (e-CFM) aims to improve management of case dockets in first and second tier courts. The “Case Management Information System” (CMIS) financed by USAID is used in the Supreme Court, the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals.
    

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