1 © 2014 By the Office of Senator Paolo Benigno “Bam” A. Aquino IV Rm. 510, 5th Floor, Senate of the Philippines, GSIS Financial Center, Roxas Boulevard, Pasay City Tel. No. (632) 552-6601 | Fax: (632)552-6601 loc 8623 | Email: team.bamaquino@senado.ph All Rights Reserved. No part of this publication may be reproduced in any form or by any means electronic or mechanical, without written permission from the publisher. Cover photo: Sen. Bam Aquino with Kalasag onion farmers. San Isidro, Nueva Ecija Photo: John Paramio 2 3 TABLE OF CONTENTS “We should ensure that as our economy grows, no Filipino is left behind.” Initial stages of bag weaving. Rags2Riches Photo: Maine Manalansan 1 INCLUSIVE GROWTH CHALLENGE 7 TRADE, COMMERCE & ENTREPRENEURSHIP 39 4 Portrait of Sen. Bam Aquino. Photo: Paulina Uy 51 PROGRAMS & ADVOCACY 81 CONNECT WITH SEN. BAM AQUINO YOUTH 5 MESSAGE Dear friends and fellow Filipinos, When I think of the past 365 days, I think not only in terms of my own personal journey from the private sector to the Senate; I think also in terms of our shared journey and what we had all endured and overcome as a people. This past year, we witnessed great upheavals that rocked the foundations of our different institutions and communities. The people cried out for general reform. We still have a long way to go, and with vigilance, I am certain that our country will emerge from these challenges stronger and more resilient than before. Huwag po tayong bibitiw dahil mahaba pa po ang ating tatahakin sa Tuwid na Daan. We also witnessed massive death and destruction because of a number of man-made and natural calamities in different parts of the country. But while we had lost thousands of lives and billions of pesos worth of food, livelihood, infrastructure, and industry, we have also risen from the debris and have begun to rebuild again. Our shared resilience, courage, commitment, and love for country and fellowmen have made us stronger and savvier as a people. Indeed, as a popular social media meme had pointed out, “the Filipino spirit is waterproof.” These and many other stories make me feel immensely proud to be Filipino. For despite all the trials and challenges we’ve hurdled this year, we still have what it takes to succeed as a country. The government’s reforms have made us one of Asia’s rising stars and breakout economies—and, with the right policies and programs in place, we can make true inclusive growth a reality for every Filipino. This book is my humble offering to you, as a valued partner of our push for inclusive growth and a better life for our countrymen. Just as you have entrusted in me the responsibility to serve our people, I trust that we can continue to work together to unlock the potential of our great country. My Tito Ninoy had once said that “the Filipino is worth dying for,” but I also believe that the Filipino is worth living and working hard for. Thank you for being an inspiration to us. Kung lahat po tayo ay magsasama-sama, walang maiiwan sa pag-angat ng bansa. Tuloy pa po ang laban. Very truly yours, SENATOR BAM AQUINO 16TH CONGRESS, FIRST REGULAR SESSION JULY 22, 2013 TO JUNE 11, 2014 ENACTED INTO LAWS RA 10644 GO NEGOSYO ACT RA 10642 PHILIPPINE LEMON LAW APPROVED ON 3RD READING (JULY 30, 2014) SBN 2212 YOUTH ENTREPRENEURSHIP BILL PENDING ON 2ND READING SBN 2210 POVERTY REDUCTION THROUGH SOCIAL ENTREPRENEURSHIP (PRESENT) BILL FILED COMMITTEE REPORT (JUNE 16, 2014) FAIR COMPETITION ACT BAM AQUINO 6 7 INCLUSIVE GROWTH CHALLENGE Roadside vegetable vendor. Quezon City 1 John Paramio Photo: 2 INCLUSIVE GROWTH CHALLENGE In the book Breakout Nations: In Pursuit of the Next Economic Miracles, author and head of emerging markets at Morgan Stanley, Ruchir Sharma, identifies the Philippines as one country—alongside Turkey and Nigeria—that will: “1.) grow faster than market expectations, and 2.) beat their peer groups, the two conditions that he says create a breakout nation.”[1] Sharma cites several factors that contribute to the Philippines’s X-factor at a time when many countries are still reeling from a global recession: a young population—half of which is under 21, a well-educated and English-speaking workforce, having “the world’s fifth-largest share of natural resources”, and reforms being implemented under the administration of President Benigno Aquino III. “Its average income of just $2,500 [Php108,000 annually or Php9,000 a month – ed.] leaves room for growth,” writes Sharon Kahn of the Columbia Business School’s Chazen Global Insights, in her review of Sharma’s book. And, indeed, that is the challenge facing both government and the private sector today: how to capitalize on unprecedented growth, critically acclaimed reforms, and global confidence in order to make growth more inclusive and felt by almost 100 million Filipinos across the archipelago and around the world. For the government, inclusive growth is the desired outcome of a tangled web of factors that require more than just one administration—and certainly more than just government on its own—to tackle. For the Filipino people, it’s a long- and tightly-held dream of escaping poverty, of food on the table, of education, of prosperity, of families reunited thanks to opportunities back home. It may be the country’s biggest challenge yet—alongside sustaining well-placed reforms—but the Philippines is in that sweet spot of timing, opportunity, and momentum. If we get our act together to push for the right legislation, policies, programs, and public-private partnerships, the Philippines could very well take off and succeed, making the dream of a better life real for every Filipino family. [1] “10 Breakout Nations to Watch” by Sharon Kahn in Columbia Business School’s Chazen Global Insights. http://www8.gsb.columbia.edu/chazen/globalinsights/node/199#.U9GdhPmSxqU. Last accessed on July 25, 2014. 3 ACCOMPLISHMENTS CHALLENGES 19.1% of the population are poor.-PHILIPPINE STATISTICS AUTHORITY (PSA), 2013 -NATIONAL ECONOMIC DEVELOPMENT AUTHORITY (NEDA), 2013 From 2012, the Philippines received an upgrade of -DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE), JANUARY 2014 *THESE INVESTMENT GRADE RATINGS SHOW THE IMPROVEMENT IN THE INVESTMENT CLIMATE OF THE COUNTRY. THESE WOULD BRING DOWN BORROWING COSTS AND WILL ATTRACT MORE FOREIGN INVESTMENTS. REFERENCE: HTTP://WWW.INTERAKSYON.COM/BUSINESS/58184/EDITORIAL--WHAT-INVESTMENT-GRADE-MEANS-FOR-FILIPINOS---AND-WHAT-IT-DOESNT 4 TRABAHO, NEGOSYO, EDUKASYON THE FULFILLMENT OF THE “KUNG WALANG CORRUPT, WALANG MAHIRAP” PROMISE Four years into the administration of President Benigno Aquino III, the Filipino public and the world have seen how the government has placed anti-corruption efforts squarely in the frontline of the Aquino administration’s agenda. Fiscal reforms, better governance, and increased investor confidence have put the Philippines back on the global map, making it an economy to reckon with in Asia. As the national government continues its efforts to purge corruption, Sen. Bam Aquino has chosen to focus on three critical elements that would complete the “…walang mahirap” part of Pres. Noynoy Aquino’s campaign promise. These are trabaho (jobs), negosyo (business and livelihood), and edukasyon (education). KEYS TO UNLOCKING INCLUSIVE GROWTH 5 For Sen. Bam, investor confidence would mean very little without the creation of actual jobs and opportunities for Filipinos here in the Philippines, and growth would mean nothing if it does not raise people out of poverty. 6 TRADE, COMMERCE AND ENTREPRENEURSHIP CAMPAIGN PROMISES FULFILLED GO NEGOSYO ACT | PHILIPPINE LEMON LAW PRESENT BILL | TAX REFORM MEASURES | PRICE WATCH | SENATE INVESTIGATIONS O ne of the functions of a Philippine senator is to preside as chairperson of one or more Senate committees. These committees are responsible for hearing the bills that are referred to them, conducting investigations within their purview, and tackling other important matters within their jurisdiction. In 2013, Sen. Bam Aquino was elected as chairperson of the Senate Committee on Trade, Commerce, and Entrepreneurship. As the name suggests, the committee exercises oversight functions over matters relating to all business, such as domestic and foreign trade, quality control, and stabilization of prices of commodities, consumer protection, and the promotion of entrepreneurship, among others. A multi-award winning social entrepreneur and a Young Global Leader of the World Economic Forum (2006), Sen. Bam brings his rich experience in social enterprise to the Philippine Senate, pushing for legislation and programs that aim to unlock economic opportunities for the poorest of the poor, thus driving inclusive growth. Woman weaving recycled plastic into bags for Kabalikat. Baseco, Manila Photo: John Paramio 7 8 CAMPAIGN PROMISES FULFILLED Senator Bam Aquino’s first year as senator saw the neophyte legislator and his team work to pass two laws: Go Negosyo Act (RA 10644) , a measure that aims to boost support for micro, small, and mediumsized enterprises (MSMEs) in the Philippines; and the Philippine Lemon Law (RA 10642), a measure that seeks to protect Filipino consumers against sales and trade practices which are deceptive and unfair. Both measures were signed into law by President Benigno Aquino III on July 15, 2014. The neophyte senator tirelessly worked for the passage of two aforementioned bills, sponsoring and defending them during several interpellations on the Senate floor until they were approved by colleagues. 9 Sen. Bam Aquino at the Session Hall. Senate of the Philippines, Pasay City Photo: Ariel Peñaredondo 10 CAMPAIGN PROMISES FULFILLED 99% OF ALL BUSINESSES IN THE PHILIPPINES ARE MICRO, SMALL, OR MEDIUM-SIZED ENTERPRISES (MSMEs) 92% AMONG THESE, ARE MICRO ENTERPRISES 66% THEY ACCOUNT FOR The roadblock: in the Philippines, starting a small business is like entering a labyrinth and getting lost amid documents and red tape. This situation drives away potential investors and prospective entrepreneurs, leading to lost employment and livelihood opportunities for many Filipinos. The answer: Sen. Bam’s Go Negosyo Act (RA 10644) seeks to improve ease of doing business and make it more feasible for ordinary Filipinos to become their own bosses and set up their own enterprises. It mandates the creation of Negosyo Centers that will provide access to financing, training, and other forms of assistance to Micro, Small and Medium Enterprises (MSMEs). Through the Negosyo Centers, MSMEs will have a chance to not only start up, but also to succeed and to grow. OF ALL JOBS IN THE COUNTRY * SOURCE: DEPARTMENT OF TRADE AND INDUSTRY (DTI), 2013 GO NEGOSYO ACT (RA 10644) 11 12 Negosyo Centers shall integrate all existing programs of government— such as registration, training, and financial assistance–and create partnerships in order to give MSMEs access to financing, strengthen their market linkages, and provide mentorship programs. The Negosyo Centers are also envisioned to be strong information hubs for entrepreneurs. For 2014, the Office of Sen. Bam Aquino will launch pilot areas in Taguig, Quezon City, Batangas, Iloilo, Bohol and Cagayan de Oro. These pilots shall be implemented through the Department of Trade and Industry (DTI), their respective local government units, partner agencies and financial institutions. “ The entrepreneur community fully supports the Go Negosyo Act as this will provide sustained assistance and mentorship support to MSMEs in all the provinces, facilitate the ease of starting and growing a business, and spur regional development to create progress and prosperity in the region.” WHY WE NEED THE GO NEGOSYO ACT -- JOEY CONCEPCION Entrepreneur, Founder of the Philippine Center for Entrepreneurship/Go Negosyo “ Ate Fe of Kabalikat. Baseco, Manila Photo: John Paramio The passage of the Go Negosyo Act is a welcome development and a measure whose time has come. Like government, we really hope to attract more people to open up businesses in our communities...” In Baseco, a community in Tondo, Manila, many residents survive on only Php75 (less than USD 2) a day, eking out a living by collecting trash and empty bottles. -- RODERICO BIOCO President of Bukidnon Kaamulan Chamber of Commerce and Industry, Inc. The group started with candy- and soap-making, but their lack of access to market and financing forced them to look for other means of livelihood. They eventually did well by making bags out of foil packs from snacks and juices. All that changed when Kabalikat sa Kaunlaran ng Baseco, Inc. (Kabalikat), a people’s organization, was established to provide its members with training on livelihood opportunities as well as financial literacy and savings. Through Mercy Relief’s intervention, Kabalikat’s products were introduced to a retail giant, and the group eventually became a supplier for the store’s Kultura line of products. The income of the members doubled with this initiative. However, Kabalikat’s progress halted when the said retail giant required them to submit fresh designs, which they were not capable of. Unfortunately, the group has now temporarily suspended production of its foil-pack bags. The aim of the Negosyo Centers is to aid small business organizations such as Kabalikat by linking them to agencies and private entities that can assist them in product development, market linkage and expansion. GO NEGOSYO ACT (RA 10644) 13 14 CAMPAIGN PROMISES FULFILLED CARS SOLD IN THE PHILIPPINES PER DAY IN 2013 583 70% OF CARS SOLD CAN AVAIL THE PHILIPPINE LEMON LAW AVERAGE PRICE OF NEW CAR IN THE PHILIPPINES P875,000 Cars deemed as “lemons”, are not only a burden to its owners, but also to the public at large. Unfortunately, buyers of “lemon vehicles” are at the mercy of car dealers and manufacturers. They often have no other choice but to spend on costly repairs and hope that defects are eventually fixed. Thanks to the Philippine Lemon Law (RA 10642), car buyers can now protect themselves against defective motor vehicles. It mandates car dealers and manufacturers to return the full value of the purchase back to the buyer, if the motor vehicle bought is proven to be of substandard quality, within 12 months or 20,000 kilometers from the original delivery date. Aside from consumer protection, the Lemon Law will likewise provide for consistent standards of quality and performance in the auto industry. SOURCE: CHAMBER OF AUTOMOTIVE MANUFACTURERS OF THE PHILIPPINES INC. (CAMPI) PHILIPPINE LEMON LAW (RA 10642) 15 16 Cars in the parking lot. One of which could be a lemon car. Photo: Ariel Peñaredondo WHY WE NEED THE PHILIPPINE LEMON LAW It is every Filipino family’s dream to own a brand-new car. Melody (not her real name) worked hard to afford her own vehicle for her family. Instead of relying on public transportation, she and her family could travel with ease. However, only a few days after purchasing the car, she felt that the engine was sluggish and lacked acceleration. She returned the car to the dealer to have it checked. After several weeks, Melody visited the dealer and was surprised to see that her car was taken apart. Mechanics said they had difficulty determining the problem. She demanded that her car be replaced with a new one, but this was rejected by the dealer, who said that nothing in the law mandates them to replace a defective car or give the buyer a refund. Because of this, Melody filed a court case to force the dealer to replace the car or return her money. The case is still being heard years after it was filed, while the car continues to wear away just like Melody’s dream. With the Philippine Lemon Law, consumers like Melody will be protected from unscrupulous dealers and manufacturers that sell substandard or defective vehicles. Violators will be liable to pay a minimum amount of Php 100,000 as damages, without prejudice to any civil or criminal liability. PHILIPPINE LEMON LAW (RA 10642) 17 18 The Legislative Process How a Bill Becomes a Law 1. Filing/Calendaring for First Reading A bill is filed in the Office of the Senate Secretary where it is given a corresponding number and calendared for First Reading. PROPOSED BILLS OF SENATORS UNDERGO SEVERAL STEPS BEFORE THESE ARE ENACTED INTO LAWS. 6. Voting on Second Reading Senators vote on the second reading version of the bill. If approved, the bill is calendared for third reading. 7. Voting on Third Reading 2. First Reading Its title, bill number, and author’s name are read on the floor during the Senate session, after which it is referred to the proper committee. 3. Committee Hearings/Report Committee conducts hearings and consultation meetings. It then either approves the proposed bill without an amendment, approves it with changes, or recommends substitution or consolidation with similar bills filed. Printed copies of the bill’s final version are distributed to the Senators. This time, only the title of the bill is read on the floor. Nominal voting is held. If passed, the approved Senate bill is referred to the House of Representatives for concurrence. 8. At the House of Representatives The Lower Chamber follows the same procedures (First Reading, Second Reading and Third Reading). Repeat steps 1 to 7. 9. Back to the Senate 4. Calendaring for Second Reading The Committee Report with its approved bill version is submitted to the Committee on Rules for calendaring for Second Reading. 5. Second Reading Bill author delivers sponsorship speech on the floor. Senators engage in debate, interpellation, turno en contra, and rebuttal to highlight the pros and cons of the bill. A period of amendments incorporates necessary changes in the bill proposed by the committee or introduced by the Senators themselves on the floor. If the House-approved version is compatible with that of the Senate’s, the final version’s enrolled form is printed. If there are certain differences, a Bicameral Conference Committee is called to reconcile conflicting provisions of both versions of the Senate and of the House of Representatives. The Conference committee submits report on the reconciled version of the bill, duly approved by both chambers. The Senate prints the reconciled version in its enrolled form. 10. Submission to Malacañang Final enrolled form is submitted to Malacañang. The President either signs it into law, or vetoes and sends it back to the Senate with a veto message. REFERENCE: PHILIPPINE SENATE WEBSITE: WWW.SENATE.GOV.PH THE LEGISLATIVE PROCESS 19 24 20 25 POVERTY REDUCTION THROUGH SOCIAL ENTREPRENEURSHIP (PRESENT) BILL 55% OF FILIPINOS HAVE RATED THEMSELVES POOR - SOCIAL WEATHER STATION (SWS), 2013 LIVING BELOW THE POVERTY LINE 23.75M - PSA, 2012 Social enterprise is fast becoming the business model to emulate. It provides new and more sustainable ways of solving old problems. Social entrepreneurs create systems that directly engage the poor as partners, as employees, as suppliers, as beneficiaries, and even as customers. Several Filipino social enterprises, such as The Hapinoy Program and Rags2Riches, have made their mark in the global community and have won several local and international awards for their work in giving poor Filipinos a chance to earn and move up in life. Sen. Bam Aquino’s Poverty Reduction through Social Entrepreneurship (PRESENT) Bill will give social enterprises much-needed support by providing them with funding, training, and market linkages in order to introduce and sell their products. IDENTIFY POOR SUBSECTORS & COMMUNITIES LINK & EXPAND MARKETS PROVIDE FUNDING DEVELOP PRODUCTS As of press time, the PRESENT Bill is up for second reading in the Senate. GIVE TRAINING 21 22 THE PROMISE OF THE POVERTY REDUCTION THROUGH SOCIAL ENTREPRENEURSHIP BILL Years ago, the housewives of Payatas, an urban poor community in Quezon City, tried to earn extra money by making rugs and rags from fabric scraps while taking care of their children at home. However, all their hard work amounted to very little, as they received only about Php20 (less than USD0.50) for a day’s work. Meanwhile, middlemen, who controlled the supply of fabric and their access to market, pocketed most of the profits from their handiwork. Things changed with the arrival of Rags2Riches, a Manila-based social enterprise. Rags2Riches Inc. (R2R) saw greater potential in the rugs that the nanays (mothers) of Payatas were producing, and used the expertise of internationallyacclaimed Filipino fashion designer, Rajo Laurel, to transform the lowly footrugs into fashionable, high-end bags. From earning only Php20 a day, each R2R nanay now earns ten times more, and is able to provide her family with food and other essentials. In four years, R2R was able to train over 800 artisans across 21 communities in the Metro Manila area, and it continues to expand its social impact in povertystricken areas. It has also collaborated with other big names in the Filipino fashion industry. At present, R2R bags are available not only in upscale retail outlets in the Philippines but are also available in London and New York. Aside from providing housewives with bag-making skills and fair access to markets and the formal economy, R2R also offers additional skills-based, financial and health training, maximizing the nanays’ career potential and bringing them closer to long-term financial and personal well-being. Group of mothers weaving bags out of scraps of cloth. Rags2Riches Photo: Marc Latzel POVERTY REDUCTION THROUGH SOCIAL ENTREPRENEURSHIP (PRESENT) BILL 23 24 In an ideal world, Filipino employees and workers should be able to enjoy higher takehome pay without jeopardizing the survival of the firms that employ them. However, there is a delicate balance between ensuring the growth and sustainability of the firms and companies, and working-class Filipinos’ need for higher wages. Recognizing this tension of economic forces, Sen. Bam has proposed tax reform measures that aim to make employees take a fairer share of their income while also providing start-up businesses the space to grow and establish their operations. 25 26 Senate Bill No. 2217 TAX REFORM MEASURES 27 28 PRICE WATCH Part of the oversight function of the Senate Committee on Trade, Commerce, and Entrepreneurship—especially under Sen. Bam’s watch— is to ensure that items are sold fairly and comply with government standards in order to protect public safety. In his first 365 days, Sen. Bam led three such market inspections and test buys. • Overpriced construction materials. Last September 2013, Sen. Bam flagged the DTI about the overpricing of construction materials in areas devastated by Typhoon Yolanda in Eastern Visayas. After that, the DTI committed to doubling and even tripling the frequency of its monitoring against unscrupulous traders. • Christmas Lights. Last November 5, 2013, Sen. Bam and the DTI led the inspection of Christmas lights being sold in different stores to ensure consumer safety during the holiday season. • School Supplies. Last May 29, 2014, Sen. Bam, together with the other concerned government agencies such as the DTI and Food and Drugs Administration (FDA), conducted a joint test-buy operation to check prices and ensure the quality and safety of school supplies being sold in Divisoria in the City of Manila. School Supplies Inspection headed by Sen. Bam Aquino, DTI Secretary Gregory L. Domingo and FDA Administrator Dr. Kenneth Hartigan-Go. Divisoria, Manila 29 Saira Peñaranda- Ferrer Photo: 30 SENATE INVESTIGATIONS SUBSTANDARD STEEL. (SRN 564) After the devastation caused by the strong October 15, 2013 earthquake in the province of Bohol, Sen. Bam visited the province to inspect the rehabilitation efforts. Under the leadership of Sen. Bam, the Senate Committee on Trade, Commerce, and Entrepreneurship has held hearings and investigations on the following issues: EASE OF DOING BUSINESS. (SRN 100) In 2013, the Philippines ranked 138th in the International Finance Corporation (IFC)’s Ease of Doing Business Index, prompting Sen. Bam to investigate the slow process of business registration in the country, alongside other factors that contribute to ease of doing business and global competitiveness. Due to the collective efforts of the government and private sector, the Philippines’ ranking jumped up 30 notches, now placing 108th among 144 countries after several months. 31 In addition, after receiving reports of rampant smuggling in the steel industry, he initiated an investigation on substandard and smuggled steel. SOURCE: NATIONAL COMPETITIVENESS COUNCIL (NCC), 2013 The investigation revealed that 300,000 lives are at stake due to substandard reinforcement bars created from wire rods, used in an estimated 60,000 houses in different parts of the country. During the hearing, the Bureau of Customs (BoC) committed to strengthen its monitoring of steel products entering the country while the DTI vowed to clamp down on erring businessmen selling substandard steel. As of press time, the probe is still ongoing. Bunk houses for displaced earthquake victims. Cogon Norte, Loon, Bohol Photo: Lorraine Castañeda 60,000 HOUSES USING SUBSTANDARD BARS 300,000 LIVES AT STAKE 32 SLOW INTERNET. (SRN 620) Alarmed by reports that the Philippines is lagging behind its Southeast Asian neighbors, Sen. Bam called for a probe on slow Internet speeds in the country. While recognizing the efforts of the private sector in improving the country’s connectivity, the investigation was also in preparation for the ASEAN Economic Community (AEC) in 2015. The investigation revealed that network congestion is one of the main reasons for slow Internet speed in the Philippines. As a result, Sen. Bam is pushing to amend the Public Service Act of 1936 (Commonwealth Act No. 146) and Public Telecommunications Policy Act (RA 7925) to improve policies that regulate Internet service providers in the country. Moreover, Sen. Bam proposes that the National Telecommunications Commission (NTC) conduct regular inspections to determine if additional infrastructure is needed to address congestion problem. He also calls on stakeholders to work together and improve the country’s telecommunications infrastructure for better Internet service. As of press time, the probe is still ongoing. Sen. Bam Aquino during the Senate hearing on the slow Internet services in the country. Senate of the Philippines, Pasay City Photo: Saira Peñaranda - Ferrer SENATE INVESTIGATIONS 33 34 SENATOR BAM ONLINE FB.COM/BENIGNOBAMAQUINO @BAMAQUINO @BAMAQUINO 35 36 SENATOR BAM ONLINE 37 38 WWW.BAMAQUINO.COM 97