Special feature: Update on the Zero Dropout Program in Misamis Occidental

Because of his deep concern to improve basic public education in the Philippines, SGV Founder Wash SyCip worked with the Center for Agriculture and Rural Development – Mutually Reinforcing Institutions (CARD MRI) to initiate the Zero Dropout Education Scheme (ZeDrES), a program aimed at reducing the dropout rate among public elementary schools to 0%. To help implement the program, the Kazarian-SyCip Fund was established to serve as an educational loan fund for its beneficiaries. CARD MRI members, who are mostly from poverty-stricken communities, can borrow up to 5,000 pesos for their children’s school supplies, projects and activities. These loans are payable weekly over three to twelve months.

For the past three years, SGV has been engaged to audit ZeDrES, a mission the engagement team has dubbed “Operation Zero.” In 2014, the ZeDrES team focused on fostering employment and entrepreneurship through identification of possible ventures in the areas’ agri-value chain.

One of the areas visited by Operation Zero was Oroquieta and Plaridel in Misamis Occidental. We asked Gabriel Magno and Jester James Nacalaban about their experiences with the program.

What was the SGV CARD engagement team’s role in the Zero Dropout Program?

In general, our role was to perform a program audit of the CARD’s Zero Dropout Education Scheme (ZeDrES) loans. The program audit was meant to check on the progress of the program, to see if it is able to achieve its objective of eliminating dropouts. First, it involved interviewing the borrowers and beneficiaries of the ZeDrES loan to see how the loan has helped them with their education. Next, we also observed CARD Center meetings to check on the status of the loans and other CARD products within the community. We were also there to look at how members settle accounts and observe the other services provided by CARD. Other activities involved interviewing the teachers of the ZeDrES beneficiaries regarding the progress of these students and determining the state of the school, its facilities and materials (such as textbooks). We also interviewed officials from the Department of Education regarding the dropout rate and the percentage of out-of-school youth (OSY) within the province in the primary and secondary levels as well as measures in place to address the dropout and OSY situations. Lastly, we visited a CARD branch to perform a walkthrough of the ZeDrES loan application, disbursement, and payment and collection process. In all these areas, results have been encouraging.

For this year’s program audit, we also wanted to add the economic dimension, particularly the job creation efforts in the area. Hence, we interviewed local cooperatives and the Provincial Governor or Administrator (when the Governor was not available) on the current state of the local economy and the plans for job creation.

What were the general issues that needed to be addressed?

Our primary concern was the dropout rate. In the towns and communities we visited in Misamis Occidental, we found that there are several programs in place that actually complement each other. There were no dropouts in the communities we visited since the Department of Social Welfare and Development’s Pantawid Pamilyang Pilipino Program (4P’s) requires the beneficiaries to send their children to school. CARD’s Zero Dropout Education Scheme complemented this by providing the necessary funds for other school-related expenses.

We also wanted to find out about the job creation and economic enhancement programs being implemented in the province, if any.

What are the on-ground observations on how the Zero Dropout Program can improve?

In an interview with the head of a local cooperative, we were told that the people in the community have a number of different funding sources that offer the same thing (business loans, educational loans, etc.). This sometimes resulted in the practice of taking a loan to pay off another loan instead of using the funds for their intended purposes. We have not noted specific cases like this in the Zero Dropout Program which can be attributed to a well-developed culture of financial discipline among CARD members who also regularly receive “Credit With Education” training from CARD. Promoting similar financial literacy programs to the wider community could help address the issue on borrowing practices among the people in the area.

The Zero Dropout Program may also consider extending its coverage all the way to the secondary level. This was pointed out several times by the members that we interviewed.

What made this engagement different from other engagements you were involved in?

This engagement required us to immerse ourselves in a different environment. The issues are basic, such as ensuring collection and measuring the program’s effectiveness, but the policies and methodologies used are largely different from a typical enterprise. For example, CARD’s way of addressing credit quality and collection efficiency starts with the selection of the site for a CARD center. From our observations, the existing policies and methodologies put in place by CARD are effective. It was a great experience being exposed to such an environment because you see the different ways of approaching a familiar issue.

Moreover, the concerns we faced are much more human in nature. The parents of the beneficiaries are not after profit maximization or risk management. They just want to send their children to school. And for you to be able to contribute to that endeavor in your own little way is very fulfilling. A lot of competent people within the firm can add their own contribution to this effort.

How has SGV made a difference in the community and in you as an individual?

The skills you learn during the normal course of business in SGV are very important. And they are useful in other situations. We in FSRM have been told that “You can never go wrong with a good Current State.” And this is what we brought to our program audit. You learn to record things as they are and as accurately as possible because the appropriate action plans will come from this exercise. If our observations and recommendations are used to improve CARD’s Zero Dropout Program, by extension this would be how SGV makes a difference in the community – it trains competent individuals who are able to analyze issues as well as provide insights and improvements for the benefit of the wider community.

How can others contribute to the Zero Dropout Program?

The Zero Dropout Program is well-structured and has helped all the beneficiaries we interviewed. But not a lot know about it, even within the communities we visited. Others can contribute by spreading awareness of the program. If you, or your friends or even your household helpers, are from a province where there is a CARD center, you can research more on what the program is about, and tell others about it. The small loan amounts coupled with the low interest rates actually go a long way towards improving the lives of the youth. They are able to explore and discover their natural abilities given the opportunities provided by a decent education. Awareness is a small but important step in contributing to the Zero Dropout Program.