Efforts of the Philippine government to help poor families improve their quality of living got a big boost after the Asian Development Bank (ADB) approved a $400-million loan to support the expansion of the “Pantawid Pamilyang Pilipino Program.”

According to Department of Social Welfare and Development (DSWD) Secretary Corazon “Dinky” Soliman, the project will provide direct financial support to 582,000 of the country’s poorest families, including those living in remote areas.

She said that unlike traditional welfare programs, only families who keep their children in school and ensure that children and pregnant women get regular health check-ups can receive the cash grants.

“We are thankful for the ADB’s approval of $400 million loan for the expansion of the Pantawid Pamilyang Pilipino Program. This is very timely as the DSWD will increase the number of families receiving monthly cash grants to 2.3 million by the end of 2011. The additional funding will go a long way in expanding the reach and coverage of the program,” Soliman told reporters Thursday during a press briefing ADB office in Ortigas, Pasig City.

The “Pantawid Pamilyang Pilipino Program or 4Ps, a cornerstone of the country’s social reform efforts in the wake of the global financial and economic crisis, is a government poverty reduction program implemented through the (DSWD) which provides conditional cash grants to extremely poor households to improve their health, nutrition and education.

It gives P500 per month grant for health and nutrition and P300 per month per child for educational expenses.

A household with three qualified children can get up to P1,400 per month or P15,000 a year.

Soliman said since the program was launched in 2008, close to 900,000 poor households benefited. She said that for this year, the beneficiaries will likely reach 1 million households.

The ADB, on the other hand, said that almost one in five children in the Philippines never attend primary school and, of those who do, three in every 10 children drop out. Many of these children never receive preventative healthcare.

Meanwhile, Camilla Holmemo, Poverty Reduction Specialist in ADB’s Southeast Asia Department, said the project is very important considering that it helps poor families escape poverty.

“This project will help families escape poverty while ensuring young people have better opportunities for advancement,” Holmemo said.

“There is no better investment in a country’s future than an investment in its children,” she said.

Holmemo said that financial barriers are a major reason children and pregnant women from poor families do not regularly seek out preventative healthcare. Similarly, costs associated with education – as well as poor households’ need for additional income – are leading factors keeping children out of school.

“The cash transfer project directly addresses this problem, giving an average impoverished family 20 percent boost in annual income,” she said.

Holmemo said initial results from country’s conditional transfer program show significant increase in school enrolment, child immunization, and prenatal medical care.

Conditional transfer programs across the world have produced similar results.

“Conditional cash transfer programs have proven to be an effective way of keeping children healthier and in school,” Holmemo said.

“These programs help families break free from the cycle of poverty,” she added.

Holmemo said that the loan will be sourced from the ADB’s Ordinary Capital Resources (OCR). It will have a 25-year term, including a grace period of 5 years, an annual interest rate determined in accordance with ADB’s London interbank offered rate-based lending facility, and a commitment charge of 0.15 percent per year.