THE E-CARE “RECEIVERS TO GIVERS” POLICY & PRACTICE
The Community-Based Development Program [CBDP] of the Episcopal Church in the Philippines [ECP] has been in implementation for the past 28 years. It was formally established in 1987 and, through the solidarity and support of external partners, annual grants to the program have grown to the level of around US $700,000 at its peak in 2010. In an external evaluation of the program conducted in 2007, it was determined that out of 49 water projects implemented in various communities over 20 years, 47 were fully-operational for a 96% success rate. This includes water systems built in 1985 and 1986 which continue to operate even after more than 20 years.
However, despite transformational activities built into the program that are meant to enhance the self-reliance of partner communities, there has hardly been a breakthrough in terms of significantly obliterating the destructive worldviews of dependency and mendicancy that have continued to plague many of these communities. Instead of building self-reliance, community-development projects at times have had the opposite effect of perpetuating such dependency. One major factor resulting in this negative course is the system of resource flow in the programs, which often involved large grants that, in effect, made the communities assume the role of receivers. The hundreds of thousands or even millions of pesos in grants that poured into these communities made the communities more helpless and powerless as they realized that they could never generate these amounts by themselves and therefore believed it was solely upon the grace of others that they had received the same.
The experience of Santa Maria clearly illustrates this point. Santa Maria is a barangay of the Municipality of Licab in the Province of Nueva Ecija. Aside from Ilocanos and Tagalogs who are natives of the area, it is also home to migrants from the Cordilleras who previously worked in the mines of Acoje and Masinloc in Zambales (which have since have closed) and who used their separation pay to buy small landholdings in the area. Some of the migrants came directly from Mountain Province or Benguet in search of “greener pastures.” It is also home to the congregation of Annunciation Church in the Episcopal Diocese of Central Philippines. When the migrants came to the region, it was an un-developed area along an irrigation dike. However, through their individual and communal efforts, they were able to cultivate farmlands and build a community. This included the improvement of common areas and centers, pathways, and a foot bridge over a river that separates the community from the rest of the town. Indeed, it was a remarkable story of collective self-reliance.
A few years ago, this community – having heard of the ECP’s CBDP – requested a grant for a water system and post-harvest facilities. Consequently, an integrated development project consisting of a deep-well water system, solar dryer, warehouse and charging station was established, costing more than a million pesos in grant assistance. When the project was completed and turned over to Santa Maria through the Annunciation Credit Cooperative, which was the organizational entity established to manage the project, it was with the understanding that the Cooperative would assume responsibility for the management and maintenance of the project. But a few months after the turn over, the water system broke down and the people came back to the Church requesting that it make repairs to the system. When a strong typhoon blew the roof off of the warehouse, another request was made for the Church to rehabilitate it. Soon, solicitation letters were received from the community almost every time a calamity hit the area. What had happened to this community that was previously characterized by a strong sense of self-reliance? Sadly, the project grant had sown the seeds of dependency.
The Santa Maria integrated project was implemented at a time when the ECP was starting to integrate the use of the Asset-Based Community Development [ABCD] approach, which emphasizes assets or resources instead of needs or deficiencies as drivers of development. The erstwhile self-reliance of the Santa Maria community was, in fact, identified as a major asset or strength that facilitated positive consideration of the project proposal. However, even this approach did not and does not fully address the dependency and mendicancy problem. ABCD therefore was in danger of becoming just another by-word – a concept meant to justify and smoothen the resource flow from external partners to local communities by providing the rationale for the community to leverage external resources in a manner that was more acceptable to the funding partners but, in the end, did not actually make a significant dent on dependency. ABCD proved to be no match for the well-entrenched culture of dependency. Hence, the ECP was in search for the “magic formula” that would address this problem.
There were two incidents that gave the ECP the impetus for evolving an effective approach to address the dependency problem.
One: The Scourge of Receiving!
The National Development Officer [NDO] attended the General Convention of the Episcopal Church [U.S.A.] in Anaheim, California in 2009. Among several meetings he participated in, he was invited to a reception of the Stewardship Network which was honoring a Taiwanese priest for his work on stewardship. More specifically, the awardee was being honored for his leadership over a Taipei congregation whose generosity made possible the construction of seven church buildings overseas. It was indeed a remarkable achievement. Prior to the awarding, a video presentation showed the work of this congregation and the church buildings it constructed. When the first of these buildings was flashed onscreen, the NDO gladly recognized it as it was a church in the ECP. The second church building was likewise in the ECP and the NDO proudly acknowledged it. When the 3rd, 4th and 5th buildings were shown, the NDO started feeling very uncomfortable as these were all in the ECP. At the photo of the 6th and 7th churches, the Taiwanese priest was called to the stage and was given a standing ovation but the NDO wanted to disappear from the room. Each of the seven churches were in the Philippines and he was so ashamed of himself – especially as the video ended with the message that it was more blessed to give than to receive.
Following the awarding, a keynote speaker by the name of Rev. Ed Baker was called to give a message. A brilliant preacher, he talked about the Sea of Galilee as being so full of life from Biblical times even up to now. He contrasted it to the Dead Sea which, as the name implies, does not allow any living thing within its embrace. The difference between the two, he said, is that the Sea of Galilee receives water from the Jordan River and discharges the same water into the sea while the Dead Sea has an inlet but not an outlet. The Dead Sea only receives but does not give out water. What makes the Sea of Galilee so alive, dynamic and vibrant is the continuous process of receiving and giving out its waters. Conversely, what makes the Dead Sea dead is that it only receives, but does not give out. It was at this point that the NDO finally realized the answer to the question of dependency that had eluded the CBDP for more than 20 years.
The other incident involved an experience with the women of Miramonte in Caloocan City.
Two: Urban Poor Women Lead the Way!
Miramonte is a poor, urban community with no Episcopal congregation or members. The community was introduced to the ECP when one of its women came to Cathedral Heights [headquarters of the ECP] to offer massage services. In the course of conversations with her, it was learned that many of the women of Miramonte were jobless because the garment factories where they used to work had closed as a result of the country’s membership in WTO. [The garment industry in the Philippines was wiped out when cheaper clothing entered its market as a result of WTO membership.] But these women had assets – their sewing skills – which could propel their community to develop. And so a project evolved wherein CBDP granted ₱120,000 for the purchase of 20 sewing machines.
A pleasant “shock” in the engagement occurred when the women’s organization managing the project, named KASALIKA, requested that the fund assistance of ₱120,000 be paid within a period of one year. Up until that time, grant assistance to community projects was the norm and traditional ECP communities or those which were familiar with the grants-based operation of its development program would raise a howl of protest if any such contemplation of repayment was ever raised. For this group of urban poor women therefore to say that they were “borrowing” the amount completely shocked the ECP’s National Development staff. This community did not know much about the CBDP and therefore they did not know about the usual process of grants-giving. To them, it was normal that people don’t just receive and so they expected that they would repay whatever was given. Curious about the outcome of this arrangement, the ECP acceded to their request.
Rather than considering the funding arrangement with KASALIKA as a loan, the experience gave birth to what is now known as the “Receivers to Givers” policy. Under this policy, communities receiving external grants to support their respective projects are enabled to eventually give back and pass on what they received so that, from being erstwhile receivers, they in time also become givers. The fund allocation to community projects remained to be grant assistance but communities receiving them need to grant-back the same at some point and pass it on to other communities. The idea is inspired by the Rev. Ed Baker’s story about the Sea of Galilee being so full of life, vibrant and dynamic because it goes through a continuous process of receiving and giving out. In short, the policy institutionalizes and models the “Sea of Galilee”.
Surpassing the target!
Following the adoption of the “Receivers to Givers” policy, the development program was then re-structured and re-visioned into what is now the Episcopal CARE Program, being managed by the Episcopal CARE Foundation. The Foundation set a target of ₱6 million in prospective grant-backs from receiving communities within a three-year period [July 2012 – June 2015.] This figure resulted from a simple mathematical computation: 10% of ₱60 million – which was the total projected grants for the development program within that period. At the time the target was set, there was no serious expectation that it would be achieved as it was a huge amount considering the economic marginalization of most of the participating communities and the long history of grants-giving that ECP had with them. It took almost a year for the “Receivers to Givers” policy to be discussed and understood by partner communities and so actual grant-backs started only in early 2013, thus extending the target period up to December 2015 to coincide with the conclusion of Phase VIII of the development program. By June 2015, six months before the end of that period, participating communities had already granted back and passed-on a total of ₱15 million – an amount more than twice the target, which itself seemed impossible to achieve when it was set three years ago.
The “Receivers to Givers” practice
is not a loan program.
E-CARE makes it very clear that the “Receivers to Givers” policy [now being referred to as R2G Policy] does not establish a lending program nor does it make the Episcopal CARE Foundation a lending organization.
The difference between a loaning or lending program and that of a “Receivers to Givers” program, is that a loan is paid back to the lender who owns and has full discretion to use the said payment for whatever purpose the lender decides. If The Episcopal CARE Foundation is a loaning/lending agency, the payments made to it by partner communities is disposable for any purpose it deems fit. THIS IS NOT THE CASE. In a “Receivers to Givers” arrangement, the funds given as project support to a community, association or group remains to be a grant from the external funding partner but the community project holder “grants it back” NOT to the Foundation but to another group, community or association – possibly even to the same group, community or association for another community development purpose. While E-CARE usually receives the grant-backs which are placed in its account, IT DOES NOT OWN THEM and cannot use the funds for any purpose other than to support another development project. In effect, the grant-back is owned by the community which has passed it on. But while it does own the grant-back, the community, in the same manner, cannot withdraw the granted-back funds and allocate them for distribution to its members or to use it for purposes other than community development.
How is the external funding partner
acknowledged in the R2G Policy?
In the ledger for the grant-backs of communities, the external funding partner – which is the source of the original fund support – is indicated, thus showing a continuing partnership between the partner, not only with one community as originally proposed, but with several others through the continuing spiral of receiving and giving back. It then becomes a perpetual partnership as it does not end with just one project but spirals from one project to another.
How much should a community give in a grant-back?
When a fund support [either a grant from a funding partner or a pass-on from another community] is given to an organization or group, it is expected to use the funds for its economic benefit and development and then at some point, it must then pass them on. The maximum expectation for a pass-on shall be the amount utilized to capitalize the project [including materials costs] but does not include training, education and organizing costs. The expected pass-on is determined and agreed upon at the release of the fund support.
During the first years of implementation, water and sanitation projects – which were presumed to have a low cost-recovery mechanism – were encouraged to grant back only a certain percentage of materials costs. Certain communities however have shown that the presumption of low cost-recovery potential of such a type of project is wrong. There was an electricity-run deep well water project in Cudal, Tabuk implemented prior to R2G policy which became inoperable because people were not able to pay for the electricity costs. A local cooperative took over the system and made it operational, distilled and bottled the water and is now running a profitable operation selling bottled water aside from making water available again to those who are willing to pay user’s fees. Presently, even water projects have to give a 100% grant-back and are therefore required to go through a thorough feasibility study to identify cost-recovery measures and/or institute income-generating support activities to ensure such full grant-back. This requirement is, in fact, resulting in cheaper and even more efficient and sustainable water systems such as the Nayon Water Project.
Where does the grant-back go?
The grant-back from a community may go to any of the following:
a] Passed-on to the same group or community which granted it back for re-capitalization of the same project;
b] Passed-on to the same group or community to capitalize another project that is different from the original activity previously funded;
c] Passed-on to another group within the same community to capitalize its own project;
d] Passed-on to another community [or group within this new community] which has just undergone an ABCD process to capitalize or fund a new project;
e] Passed-on to another community [or group within this new community] which has been a previous recipient of a project under the erstwhile Community-Based Development Program [CBDP] of the ECP;
f] Passed-on to another community [or group within this new community] which has an established capacity to manage a development project; or
g] Passed-on to another community [or group within this new community] which accesses the fund purely on a “loan arrangement” [such as a cooperative or organization which gets the fund for re-lending to its members.]
Who decides where the grant-back shall go?
As the owner of the grant, the granting community decides where its grant-back shall go.
If the granting community decides to make a pass-on, it shall select from a list provided for by E-CARE to whom its grant-back shall be passed on. While it has not been done, it is also possible that the granting community can identify a community other than those in the list for as long as the latter also subscribes to the ABCD approach and abides by the R2G policy.
There are occasions when the giving and receiving communities meet and do a pass-on ceremony, such as what happened when Bantey passed on ₱200,000 from the proceeds of its rice mill project to Loccong for a similar rice mill project. This was done during the occasion of an ordination attended by various communities who then witnessed and were inspired by the pass-on.
When a community requests for a grant assistance and there are no funds available in the E-CARE account, an appeal is made to the communities or groups who are ready to make a grant-back. The response has always been positive and, in a number of cases, certain communities [e.g. Cabuloran] granted-back funds far ahead of schedule just to be able to assist the requesting community.
How many times can the grant-back be
re-granted to the same community?
One of the issues raised against the needs-based and grants-based operation of the development program in the past is that one project does not really suffice to effect a significant change in the economic landscape of a community. A water project costing more than a million pesos may have resulted in easier access to water, but the poverty situation remained basically un-changed. Yet, under a grants-based program, a second or third project that is similarly funded by external grant is not allowed. Under the current R2G Policy, however, a community can engage in a continuing partnership for as long as it likewise continually gives back. The Santa Maria experience demonstrates the desirability of such a continuing partnership.
As stated above, the ECP’s development program did not entertain the solicitations from Santa Maria community not only because it did not have the funds to support the said requests but moreso since it had already exited from the partnership and its policies did not allow a continuing grant assistance. The next time Santa Maria appeared with a request to rehabilitate not the water system and warehouse, but their farms damaged by typhoons – E-CARE presented the R2G policy. In a surprisingly pleasant manner, the community, through the Annunciation Credit Cooperative, embraced the policy and expressed agreement that it would actually result in a better relationship. At that time, since the policy was a new one which was an almost complete reversal of the erstwhile grants-based support, E-CARE set long-term repayment periods – even extending up to five years. Santa Maria, however, expressed that the fund assistance they were applying for in the amount of ₱500,000 to be used for the purchase of seeds and farm inputs, would be granted back not in five years, but in six months or at harvest time.
The first farm assistance was made in November 2012. By the first week of July 2013, the Cooperative fully paid ₱500,000, plus an add-on of ₱12,000. This add-on was then used to rehabilitate the water system. A month after the payment of the first support fund, the Cooperative again requested for ₱200,000 which they fully granted back in October 2013. The next month, they took out ₱1.2 million that was similarly fully granted-back in May 2014. Towards the latter part of June 2014, they took out another Support Fund of ₱900,000 which was also settled by December of that year. In January 2015, it took out ₱2.2 million that it granted back five months after. In the Cooperative’s report on the use of this series of fund support, 3 of its members have acquired 3 hectares of additional farm lands, all its members now have hand-tractors, 2 members have acquired vehicles for transporting crops and the Cooperative has raised ₱700,000 from lending the fund support to its members at interest rates far below the prevailing rates in the community. Indeed, dramatic and significant changes have happened in the community.
To complete the story of Santa Maria, the community was hit by typhoon Santi in October 2013 and many houses were damaged. But instead of doing the usual circulation of appeal letters, those affected, through the Cooperative, applied for a fund-assistance of ₱115,000, to be granted back in 2 years, to rebuild their houses. The development program readily approved the application, noting the major shift in paradigm. Moreover, when super-typhoon Yolanda (Haiyan) hit Central Philippines, the Cooperative declared that it was shortening the original 2-year repayment period to only 1 year to make the fund available for work in the Yolanda-affected communities. Also, the Cooperative, in April 2014, secured a separate fund assistance to repair the warehouse for which a grant request was rejected by E-CARE two years before. Both of these fund supports were fully granted back.
Presently, Annunciation Credit Cooperative’s built-up capital of ₱700,000 is utilized as the main fund that it lends to its members, which is then augmented by E-CARE’s fund assistance. It is the vision of this Cooperative that when it reaches ₱1.5 million in capital, then it will be able to service the bulk of the needs of its members and hence will reduce its requests from E-CARE.
On the whole, E-CARE envisions that participating communities will build up their respective capital funds as well as management capacities so that they can work in associational ways not only to improve their economic situations but also to influence their own destinies.
After a fund assistance is given to a community, when
should it make a grant-back?
As stated above, the program initially conceived of long-term grant-back periods as this was still more favorable than having no grant-backs at all. However, the Santa Maria experience has demonstrated the greater benefits of a shorter grant-back period and the consequent junking of long-term arrangements. Firstly, such a shorter period allows the recipients to take out subsequent support funds of varied amounts depending on actual needs. Imagine if the initial Support Fund of ₱500,000 to Santa Maria was payable in five years, it wouldn’t have made much difference because it was for the purchase of seeds and farm inputs for one particular agricultural cycle only. By the time it was due, people may already have forgotten about it. With the short-term periods and the consequent series of fund support, however, the community has already availed of a total of ₱5 million in less than four years which allowed for, among others, the above-mentioned purchase of 3 hectares of land, hand tractors, equipments, etc. Secondly, there is a direct connection between fund-assistance and the actual fund requirements of the community. In Santa Maria the corn season, which is within the first semester, always requires a higher capital as compared to the rice season in the second semester. Hence, its cooperative usually seeks higher funding support during the first semester. Finally, the engagement between the recipient and the program is continuous and success stories are constantly shared and learned.
Characteristic of ABCD-driven projects however, there is no “one size fits all” policy that applies to all projects. The grant-back period is necessarily dependent upon the nature of the project. If it follows an agricultural cycle, the participating communities themselves prefer a period that coincides with such a cycle. There are other projects that entail longer-term repayment periods, depending on the period when actual income is generated, such as agro-forestry, cattle raising, etc.
Is a community required to make an
add-on gift to the grant-back?
An add-on gift is an incremental amount given by the granting community in addition to the agreed upon materials cost or capital which it pledged to grant-back.
The first time that a community partners with E-CARE, there is no add-on to the grant-back, especially if the fund support comes from external funding partners. The grant-back consists of the total materials cost as agreed upon at the beginning of the project.
However, in succeeding engagements with the same community or with a community which had a previous project funded through E-CARE [or the previous CBDP], an add-on is required in order to: a] build up the capital of the implementing organization; b] provide support to E-CARE; and, c] pay for the costs of continued monitoring and related activities. The add-on is accordingly divided into three segments for these purposes. One-third, covered by the first stated purpose, is actually given back to the implementing organization as start-up or additional capital in order that it will, in future time, be able to use this capital to fund its own projects. The add-ons imposed in Santa Maria have resulted in ₱700,000 capital of Annunciation Credit Cooperative as of June 2015. The Urnos di Igorot [USDI] in Holy Faith has already built-up more than a million pesos in capital, partly from its one-third share in the add-ons. The second 1/3 of an add-on is to be used to make E-CARE operationally self-supporting by 2019. In July 2014, the Board of Trustees of E-CARE resolved that the salary of the National Development Officer [NDO] shall be paid from the support of communities, consisting of the share of E-CARE in the add-ons to the grant-backs. The third goes to an Episcopal congregation in the community where the project is being implemented, which shall assume the continuing role of monitoring and liaising between the community and E-CARE.
Why does the local Episcopal congregation
get a share from the add-on?
The “Receivers to Givers” policy does not create a legal obligation on the part of the participating communities. If these communities refuse to make a grant-back, there is no legal enforcement process. What the policy establishes or enhances is a moral obligation on the part of the said participating community, an aspiration to share its blessings with others in order to make this world a much better place to live in for everybody.
So far, since the R2G Policy was implemented, no community has yet refused to make a grant-back despite the lack of any legal obligation or security to do so. What is keeping the entire system working very well is the moral force of Christian charity and sharing advocated by E-CARE and preached and lived-out by the local Episcopal congregations. Even among groups whose members are not Episcopalians or where the latter compose the minority, there has been an insistence to share one-third of incremental amounts to the Episcopal congregation in an expressed recognition of the good cause and efforts to sustain such a cause by the said congregations. There has to be a recognition therefore of this critical contribution of the local congregations in sustaining the entire enterprise of “receiving and giving back”.
But from a practical standpoint, the local congregations are doing actual services that are rightfully compensable. Under the current program, operational costs covering personnel and other administrative expenses are covered by budgets negotiated with and provided for by the external funding partners. However, these budgets cover only the engagements with new communities. E-CARE Project Officers are assigned in these new communities, and when the community’s projects are completed and turned-over to the implementing organizations, the staff transfer to other new communities covered by proposals to the funding partners, creating a vacuum in the regular monitoring of the turned-over projects. Such tasks are then given to the local congregations within the community. The services of these congregations include the following: a] monitoring and reporting continuing project implementation; b] liasing with E-CARE on progress of continuing projects and addressing emerging issues and concerns; and, c] organizing new groups within the community and facilitating ABCD orientation or review.
In communities where there are no local Episcopal congregations to perform these functions, no corresponding share is taken for this purpose. The sharing of the add-on would be between the implementing organization and E-CARE, with the bigger share going to whichever commits to perform the services and functions laid out in the preceding paragraph.
How much is the increment or add-on
to the grant-back?
There is no fixed formula. In communities where interest rates on loans are usuries, ranging from 3% to 5% per month, an increment or add-on to grant-back of 1.5% per month is very much welcomed by the said communities. In more interior rural villages however where people do not borrow money simply because they do not have access to such service, an add-on of .5% to 1% per month may be more acceptable. In the poor, urban community of Miramonte, Caloocan, no add-on has been made despite the several rounds of granting and granting back already undertaken.
Many of the rules and principles under the R2G policy were evolved out of actual practice and experience. It is expected that these will be further enriched and evolved by the continuing development process.