National Economic and Development Authority (NEDA) Director-General Augusto Santos has attributed the "worsened poverty situation in our country" to "increasing prices and/or insufficient rise in personal income."

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In a press conference Wednesday, government officials disclosed that poverty incidence increased by 2.5%, from 24.4% in 2003 to 26.9% in 2006. [Click here]

In 2003, 24 out of 100 families in the Philippines were poor; in 2006, 27 out of 100 families were poor.

Higher prices in 2004 to 2006 "hindered access" to food and non-food basic needs, which "pushed some individuals and families down the poverty line," Santos said in a statement.

"The government's commitment to solve the fiscal deficit also put upward initial pressure on inflation," Santos said.

He also cited the expanded Value-Added Tax (VAT) coverage and rates in 2005-2006 as a factor that caused higher prices.

Santos said higher oil prices during the survey period also contributed to higher prices of food and other basic commodities.

Big typhoons which hit the country also caused higher food prices, he said.

Santos said the relatively high population growth of 2% also makes it more difficult to reduce poverty.

Despite the rise in poverty, National Anti-Poverty Commission said in a statement it "remains steadfast and confident" the poverty reduction targets under the Medium Term Philippine Development Plan (MTPDP) can be achieved.

Santos said the 7.3% economic growth rate in 2007 would also help alleviate poverty.

He said the Arroyo government has increased social services spending since 2007.

Santos said the higher poverty figures may require a review of the MTPDP.

He said the NEDA will be holding consultations with "top CEOs of big corporations" in the coming weeks to get their views on the MTPDP.

(First posted: 3/5/2008 1:03:15 PM)