Reducing Income Inequalities

1
Reducing Income Inequalities

• Trade Union Congress of the Philippines (TUCP)

Ariel B. Castro Director for Education
2
Introduction and overview

• Unions evolving role
• Labor market realities
• Disturbing economic signs
• Jobless Growth
• High unemployment and underemployment
• Wages and benefits not kept up with prices
• TUCP responses
• Concluding remarks

3
Evolving union roles given realities

• Union renewal and revitalization strategies to
  confront
• Changing nature of work
• New model of human resource management
• Changing composition of labor force
• Political/legislative challenges

4
Economic realities

• Economic growth in the Philippines is expected to
  fall to 4.3 percent this year and 4.2 percent in
  2009 amid a global credit crisis (The Economist,
  2008)
• Double digit inflation is eating into consumer
  spending and wages have failed to keep pace with
  rising living costs

5
Economic Realities (2)

• Remittance flows of overseas Filipino workers
  (OFWs) now equivalent to 10 percent of GDP
• Economy is underperforming relative to its
  neighbors in the region with per capita GDP
  growth of one percent trailing its neighbors 4-6
  percent
• Investment climate requires some reforms that
  should include reducing power rates, curbing
  corruption and cutting red tape

6
The World Bank Development Report 2005

• A 2003 survey involving 719 firms in the
  Philippines ranked the issues that make the
  countrys investment climate unattractive to
  business
• 35.2 corruption
• 33.8 courts on property rights
• 33.4 unreliable power supply
• 30.4 high tax rates
• 29.5 uncertain economic and regulatory policy
• 26.5 crimes, theft and disorder.

7
Jobless Growth

• Employment levels are rising, but most of the new
  jobs created (60-75) are in the informal sector
• BPOs are the growth center, and would surpass
  manufacturing in the next few years

8
ADDITION TO LABOR FORCE VS. JOB CREATION
9
Source NWPC
10
Labor Market, Employment and Working Conditions

• Quality of employment has deteriorated, with new
  employment concentrated in contractual terms,
  home-based work, and informal arrangements
• Women and young people face unemployment,
  inadequate education and training, exploitation
  and discrimination at work
• Inspections of establishments have indicated
  increasing violations of labor standards (over
  50 with violations) and of the wage law (over
  25)

11
8.08 Filipino Migrants
12
Social outcomes lackluster

• Given present trends, Philippines unlikely to
  realize its MDGs by 2015 in
• families living in extreme poverty
• child malnutrition
• maternal mortality

Source World Bank
13
Trade Union Responses

• Alliance Building for Constructive
• Engagement with IFIs
• Promoting Decent Work for All

14
Asian Labor Network on IFIs

• Network of TUs, Pos, NGOs and academe from four
  countries most hit by the Asian Financial Crisis
  Indonesia, Philippines and Thailand
• More than an institution for workers education,
  it has evolved into an organization with a
  multifaceted approach to advocacy and social
  action

15
Mission Statement

• Committed to engage IFIs and the Philippine
  Government in constructive dialogues on policies,
  programs and projects that have direct impact on
  Filipino workers and society at large
• People believe that IFIs propose, the Government
  implements, workers and people suffer

16
ALNI/P Priority Advocacy Issues
17
Framework of engagement

• Advocates to stop Liberalization, Deregulation,
  Privatization LDP until
• Past and proposed policies are assessed as to
  their impact on employment and incomes
• Future policies, programs and projects must
  include measures to help displaced workers
• Tripartite negotiations are made
• Arose from Philippine experience in LDP

18
Efforts to constructively engage IFIs
19
Efforts to constructively engage IFIs

• Building relationships with IFI officials
• Representation meetings
• Cooperation with Asian Development Bank
• Meetings with ADB Officials
• Participation in consultations (WB, IFC)
• Meetings with Government Agencies involved in the
  design and implementation of IFI programs

20
Efforts to constructively engage IFIs

• Dialogue with ADB regarding their Labor Standards
  Handbook
• Research on CLS Compliance of IFC funded
  utilities company
• Involvement in the WB-CAS processes
• Continuing dialogue with WB, IFC, ADB, etc.

21
CLS in ADB Operations
Labor market assessment
Country strategy and Programs
IPSA, Labor consultants
Pre-Project Design
Loan negotiations, Bidding documents
Project Design
Compliance Monitoring, Consultation
process, Capacity building on CLS
Project Implementation
22
Efforts to constructively engage IFIs

• Media Advocacy
• Generate Public Support
• Media Briefings
• Press Conferences

23
Efforts to constructively engage IFIs

• Advocacy and Planning Workshops

24
Why should unions engage IFIs?

• Union jobs are at risk
• ADB/IFIs heavily influence govt policies
• Privatization/restructuring public enterprises
• Liberalization, deregulation policies
• Taxpayers of donor countries finance ADB lending
  at P5-7B/yr
• Citizens of borrower countries pay back loans
  whether or not IFI-funded projects reduce poverty
• Debt burdens greatly reduce govt spending on
  public infrastructure basic social services

25
TUCP is also engaged in

• Improving labor supply-building skills,
  employment facilitation
• Raising labor demand-cooperatives, credit unions,
  workers enterprises
• Wages - pushing for productivity improvement and
  gainsharing

26
TUCP also has programs in

• Country governance
• CSR (corporate social responsibility)
• Reproductive Health and family planning
• Anti-trafficking in persons
• Informal sector
• Migrant workers
• Etc.

We also do regular trade union work
27
Unions have to quickly convert
to social movements
and do many things themselves