Philippines secures fresh $500 million ADB loan for 4Ps

MANILA, Philippines — The Asian Development Bank (ADB) has approved a $500 million loan to expand its support for the Philippine government’s conditional cash transfer program.

The Manila-based multilateral bank said the Expanded Social Assistance Project would help families sustain health and educational gains for their children achieved under the country’s Pantawid Pamilyang Pilipino Program (4Ps), which was introduced in 2008.

Under the 4Ps, the Department of Social Welfare and Development provides cash payments every two months to about 4.3 million households — as long as the children meet school attendance targets and go for regular health checkups, women avail of pre- and post-natal care, and the parents participate in family development sessions.

“The Philippine government is boosting social investment in Filipinos to break the decades-old intergenerational cycle of poverty,” said ADB vice president Ahmed Saeed.

“The 4Ps program provides vulnerable households with an income supplement to help their children become educated, stay healthy, and leave poverty for good. Our evidence shows that this is working. The 4Ps has helped 1.5 million people escape poverty since it began in 2008. Through this project loan and technical assistance support, ADB is helping the Philippines expand these gains.”

ADB said that its independent impact evaluations and analyses have confirmed 4Ps’ significant benefits to households. For example, the average enrollment rate for children aged 16 to 17 years old in 4Ps households is 88 percent, significantly higher than the average rate of 70 percent for children in non-4Ps households.

The bank said cash grants do not discourage 4Ps parents from looking for and retaining employment. In fact, employment outcomes in 4Ps families are the same as non-4Ps families. In addition, the incidence of hunger is lower for 4Ps households.

The Pantawid Pamilyang Pilipino Program Act, signed into law in April 2019 by President Duterte, made 4Ps a permanent program and increased cash grants to households.

ADB said this new loan will help fund these higher grants for program beneficiaries.

In addition to the loan, a $3.1 million technical assistance will be provided to help improve the family and youth development sessions, update the list of eligible poor households, provide a package of livelihood and other support to help up to 3,000 households graduate out of poverty, support IT reforms to automate compliance verification and grievance redress, and prepare for the integration of the 4Ps database with the government’s national ID system.

The new loan builds on ADB’s decade-long support for the 4Ps program, with total assistance to the program now reaching more than $1.5 billion. That includes the $200 million loan approved in April to provide unconditional emergency cash transfers to 4Ps households amid pandemic.

With this loan, ADB’s total lending to the Philippines has reached $2.6 billion so far this year, exceeding its record lending of $2.5 billion in 2019.