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Family income up by 16%, survey says
(Manila Standard Via Thomson Dialog NewsEdge) Filipino families earned more last year than they did three years ago, according to a survey conducted by the National Statistics Office.
In a statement, Malacanang said the survey showed that the Filipino family is beginning to benefit from the gains made by the economy.
The 2006 Family Income and Expenditure Survey estimated the average annual income of a Filipino family at P172,000. In 2003, the average annual income of a Filipino family was only P148,000. The average family income thus went up by 16.2 percent.
From 2003 to 2006, annual income in all brackets increased. The average annual income of the bottom 30 percent of families (or the lowest three income brackets combined) increased by around P8,000; while that of the upper 70 percent of families, P31,000. For all families, the increase averaged P24,000.
But the survey also showed that while the average annual income of Filipino families grew, they were not saving more as their expenses also grew.
The average annual expenditure of families increased from P124,000 in 2003 to P147,000 in 2006, or by 18.5 percent over the three-year period.
These numbers translate into average savings in 2006 of some P25,000 per family; the 2003 estimate was P24,000 per family.
These savings came mainly from the tenth income bracket with P156,000 per family on the average in 2006.
According to NSO, if inflation is taken into account between 2003 and 2006, the total family income in 2006 of P2.99 trillion would be valued at P2.50 trillion at 2003 prices. Likewise, the total family expenditure in 2006 of P2.56 trillion would be valued at P2.14 trillion at 2003 prices.
In real terms, the total income of families increased slightly by 2.6 percent while the total expenditure increased by 5.1 percent between 2003 and 2006. Also, the average family income decreased by 2.8 percent while average family expenditure decreased by 0.4 percent, the NSO said in its Web site.
Thus, the 2006 real average savings by families is equivalent to P21,000 at 2003 prices, which is lower than the 2003 average savings of P24,000 per family, the NSO said.
Likewise, the survey showed that income distribution changed slightly from 2003 to 2006. The share to the total income of families belonging to the tenth income bracket (the highest earning group) exhibited a slight decrease, from 36.3 percent in 2003 to 35.9 percent in 2006.
The survey indicated that the gap in family income between the highest earning families and that of the lowest income bracket had narrowed slightly. In 2006, the total family income of the tenth bracket was about 19 times that of the first income bracket, while it was 20 times that of the first bracket three years ago.
The spending pattern of Filipino families particularly among those in the bottom 30 percent income group (composed of the three lowest income brackets) changed in 2006, showing they spent more for food than for other items.
In 2006, 59 percent of all expenditures by this group went to food, from 48 percent in 2003. This means that for every P100 spent by this group in 2006, P59 went to food, compared to only P48 in 2003.
Consequently, there was a decrease in the shares of other expenditure items like house rent/rental value (12.7 percent to 9.0 percent), transportation and communication (6.1 percent to 3.8 percent) and education (2.9 percent to 1.3 percent).
It was a different picture in the upper 70 percent income group, which spent 41.4 percent of their income on food in 2006, compared to 43.1 percent in 2003.
Socio-economic Planning Secretary Augusto Santos admitted that while gains from reforms may have been felt at the family level, there is still a need to hasten the pace of growth to produce significant income gains within the lower income brackets.
To achieve these, he said, the government must push for policies to sustain macroeconomic stability, modernize agriculture, strengthen small enterprises and expand export markets in order to create employment opportunities.
The realignment of the national budget towards social services is a good opportunity for the government to put more emphasis on education and health in tandem with an effective population management program, Santos said.
Copyright 2007 Kamahalan Publishing Corp. , Source: The Financial Times Limited
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