MODULE 7: GROUP 7

• National Economic and Development Authority (NEDA) is the country's premier socioeconomic planning body, highly regarded as the authority in macroeconomic forecasting and policy analysis and research. It provides high-level advice to policymakers in Congress and the Executive Branch.
• NEDA's key responsibilities


  • Coordination of activities such as the formulation of policies, plans, and programs to efficiently set the broad parameters for national and sub-national (area-wide, regional, and local development)
  • Review, evaluation, and monitoring of infrastructure projects identified under the Comprehensive and Integrated Infrastructure Program consistent with the government's thrust of increasing investment spending for the growing demand on quality infrastructure facilities
  • Undertaking of short-term policy reviews to provide critical analyses of development issues and policy alternatives to decision-makers
• NEDA's vision


  A country where public and private sectors perform their respective roles efficiently, such that people have equal access to opportunities, resulting in inclusive development and zero poverty
• NEDA's mission


  To formulate continuing, coordinated, and fully-integrated socioeconomic policies, plans, and programs to enable and empower every Filipino to enjoy a matatag, maginhawa, at panatag na buhay
• NEDA's core values

  • Integrity
  • Professionalism
  • Excellence
• Economic planning is a resource allocation system in which the government makes economic decisions based on an economic plan. Planning is a mechanism for the allocation of resources between and within organizations contrasted with the market mechanism.
• Objectives of planning

  • Target rates of growth
  • Allocation of resources between private and public consumption, social investment, directly productive investment, stocks, and exports
  • Correction of imbalances in regional development
• One of the most important functions of economic planning is to achieve consistency among different economic objectives
• Vision 2040 a statement of where Filipinos aspire to be in 25 years. It is a set of goals identified by the public, for themselves, their children, their community, and the country.
• Types of economic planning

  
  

  • Medium-term development plans, usually for a five-year period, to promote economic development by assessing the current state of the economy, increasing the overall rate of investment, carrying out special types of investment to break bottlenecks, and improving coordination between different parts of the economy.
• Weaknesses of simple development plans

  • No systematic attempt to compare the relative costs and benefits of the plans proposed by different government departments
  • Lack of coordination leading to wasteful duplication and failure to take advantage of complementary relationships between projects
  • No clear-cut system of priorities in project implementation
• Integrated public investment program - formulating a more systematic plan of the public investment program as an integrated whole, by making estimates of the total financial resources available, the costs and benefits of alternative investment projects, and prioritizing projects based on time pattern of costs and benefits.
• Role of annual budget in development planning

  • Crucial in ensuring the implementation of the medium-term development plan through annual budgetary controls and discipline.
• Cherished elements of a good economic plan

  • Definite objective
  • Central planning authority
  • Democratic character
  • Only advisory role of planning commission
  • Comprehensiveness in scope
  • Planning for consumption
  • Rational allocation of resources
  • Feasible policies and targets
• Definite Objective:

  • The most significant characteristic of economic planning is that it should possess definite objectives. Planning means conscious and deliberate undertaking for a definite objective. For instance, economic planning has the objective to accelerate the rate of growth, elimination of trade cycles, bringing the stability and a attain full employment in the economy.
• Central Planning Authority

  • The existence of a central planning authority is another feature of economic planning. This central planning authority is responsible to prepare different schemes of development and coordinating the various activities. The central planning authority takes all decisions relating to production and consumption in an economy.
• Democratic Character

  • Another pioneer feature is its democratic nature. No doubt, various plans are prepared by experts but at the same time, adequate opportunities are provided to the people to actively participate at various levels. Being federal structure of Indian Constitution, the Union Government only uses its fiscal, monetary and physical controls to guide and give direction in consequence with the five year plans.
• Only an Advisory Role of Planning Commission

  • In the decentralized set up of planning. Planning Commission is the apex body. It provides the necessary perspective, guidance and coordination. Furthermore, it serves as a close link between different agencies so that functioning may be smooth. In this regard, Planning Commission is an advisory character.
• Comprehensiveness

  • Another important characteristic of planning is its comprehensiveness in scope. As central planning authority takes all decisions regarding production, consumption and distribution, thus, it must cover the entire economy which must be comprehensive in scope. In other words, planning must be effective so that the planning of one sector may not be nullified by the absence of planning in other sectors.
• Planning for Consumption

  • In a centrally planned economy, it should not be confined to production alone but at the same time, it must cover the distribution and consumption also. In other words, the planning authority should not decide what and how to produce but it must keep in mind and decide accordingly among whom it is to be distributed.
• Rational Allocation of Resources

  • Generally, in under-developed countries, available resources are scarce and these resources are allocated in such a manner as to get maximum social welfare. It needs to fix up priorities relating to economic development, thus, allocation of resources in accordance to these fixed priorities.
  • These scarce resources are also allocated to eliminate wastages for maximizing social welfare, coordinating inter-sector and international plans into a single unified unit which, in turn, promotes economic development in an economy.
• Feasible Policies and Targets

  • A good planning is based on the initial resources of the country to achieve the feasible goals and policies. In this way, domestic resources are planned for attaining economic stability
• Economic planning is a resource allocation system in which the government makes economic decisions based on an economic plan
• Economic planning

  • Planning is a mechanism for the allocation of resources between and within organizations contrasted with the market mechanism
  • As an allocation mechanism for socialism, this replaces factor markets with a procedure for direct allocations of resources within an interconnected group of socially owned organizations which comprise the productive apparatus of the economy
• Key aspects of economic planning (RIPE)

  • Resource Allocation
  • Implementation and Monitoring
  • Policy Formulation
  • Economic Goals
• Objectives of planning in developed countries

  • Optimize resource allocation
  • Reduce regional disparities
  • Maintain a high standard of living
• Objectives of planning in developing countries

  • Promote inclusive growth and alleviate poverty
  • Improve access to basic services and infrastructure for sustainable development
• The most important function of planning is to ensure consistency among different economic objectives
• Ambisyon Natin 2040 is a vision for a prosperous and inclusive Philippines, a statement of where Filipinos aspire to be in 25 years
• Elements of Ambisyon Natin 2040 vision

  • Matatag (Family is together, Time with friends, Work-life balance, Volunteering)
  • Maginhawa (Free from hunger and poverty, Secure home ownership, Good transport facilities, Travel and vacation)
  • Panatag (Enough resources for day-to-day needs, unexpected expenses and savings, Peace and security, Long and healthy life, Comfortable retirement)
• Types of economic planning

  • Development plan
  • Economic development plan
• 4 ways to promote economic development

  
  

  1. Assessing the current state of the economy and providing information about it

  2. Increasing the overall rate of investment

  3. Carrying out special types of investment designed to break bottlenecks in production in important sectors of the economy

  4. Improving the coordination between different parts of the economy
• In most third-world countries, planning has provided a motive force to acquire and analyze the necessary data to provide a better understanding of the functioning of the economy
• To improve coordination, it is necessary to spread reliable economic information to indicate the future course of the government's economic intentions and activities
• The PDP 2023-2028 is a plan for deep economic and social transformation to reinvigorate job creation and accelerate poverty reduction by steering the economy back on a high-growth path. This growth must be inclusive, building an environment that provides equal opportunities to all Filipinos, and equipping them with skills to participate fully in an innovative and globally competitive economy.
• The newly independent countries starting to plan for their economies usually begin with a simple type of development plan
• Weaknesses arising from insufficient coordination in planning

  • No systematic attempt to compare the relative costs and benefits of the plans proposed by the different departments on a uniform basis
  • Leads to wasteful duplication and a failure to take advantage of complementary relationships between individual projects
  • A simple listing of the projects does not provide a clear-cut system of priorities in their implementation
• Ways to overcome weaknesses in planning

  1. Making a careful estimate of the total amount and time pattern of the financial resources
  2. Make realistic estimates of the costs and benefits of the alternative investment projects within the public sector as a whole
  3. Pay special attention to the time pattern of costs and benefits
• Scope of economic planning

  • Definite objective
  • Central planning authority
  • Democratic character
  • Only an advisory role
  • Comprehensiveness
  • Planning for consumption
  • Rational allocation of resources
• Planning mechanism - planning involves a centralized authority making decisions about the allocation of resources across various sectors and within organizations based on an economic plan.