STRAIGHT FROM THE BIG CITY

Outsourcing for local development
IKE SENERES

MANILA -- Business Process Outsourcing (BPO) is an approach that all Local Government Units (LGUs) should consider using. Although the Build-Operate-Transfer (BOT) scheme predates BPO as an approach, the two approaches have certain parallels, so much so that local government business processes could actually be outsourced using the BOT scheme.

What is the relevance of the combined BOT-BPO approaches to the local development advocacies of the United National Integrated Development Alliance (UNIDA)? Without any doubt in my mind, all the advocacies of UNIDA, namely Shelter, Health, Agriculture, Protection and Education (SHAPE for short) could actually be outsourced to the private sector, because these are all business processes in truth and in fact.

riginally introduced in the Philippines, the BOT scheme enables local and national governments to implement projects without any cash outlay. The BOT scheme is very attractive to private sector project proponents, because it enables them to earn profits from secured contracts.

In the case of projects at the national level, project proponents would usually require sovereign guarantees. In the case of projects at the local level however, project proponents would certainly welcome the assignment of local receivables from the Internal Revenue Allocations (IRAs) of the local governments, which is already being practiced right now.

Comparatively speaking, the physical frameworks for outsourcing shelter, health and education projects are easier to define, because these are obviously just the human settlements, health centers and schools that could be built and operated.

Although much more difficult to define, agriculture and environmental protection projects could also be outsourced. There may be no examples to look at now, but it would not be far fetched for project proponents to build and operate farms, ranches, fishponds and orchards as well as sewage treatment plants (STPs) and materials recovery facilities (MRFs), eventually turning these over to the LGUs.

As a service to both the private sector and the local governments, UNIDA and its member organizations would be more than willing to facilitate the processes of introduction and negotiation, so that we could all move forward in this regard. This offer is open to all local governments in the provincial, municipal, city and barrio levels.
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Newspaper reports say that our economic growth does not benefit the poor, and the government is urged to focus on the farm sector. While there is no good news in hearing that the benefits of growth hardly goes down, it is good to hear that the needs of the farm sector are now being brought forward as a national issue.

One does not have to be a genius to realize that our farmers are not making money now, because their costs of production are too high, while the farm gate prices that are being offered to them are too low. Their high cost of production is complicated by their high costs of financing, further made difficult by their low margins of profit.

Even if the government will focus on the farm sector as it is being urged, nothing much could happen not unless the economics of farm production are changed, in such a way that it is turned around, meaning that the costs of production are made lower, and the farm gate prices are made higher.

Thanks to the innovation of a Filipino engineer, we now have a local technology that could definitely lower the costs of our farm production, at the same time potentially increasing the gate prices of farm outputs, due to the higher qualities that the technology could make possible.

And here’s the real good news. The said innovator, Engineer Walther Alvarez, has now joined SamaKabuhayan (SAMAKA), a member organization of the United National Integrated Development Alliance (UNIDA), to spread the technology to all farmers, so that their economic destinies could change for the better.

So simple and yet so brilliant, the technology enables poultry and livestock to fully digest the proteins in their diet, so much so that the farmers would not only be able to reduce their costs of feeds, it will also fast track their time to revenue, as the chickens grow to market size in 32 days instead of 45, and the hogs grow to market size in 4 months instead of 6.

As an added advantage, the technology completely removes the odor from the animal wastes, because of the complete absence of undigested protein, the waste matter that breeds bacteria and causes decay. As a result, the animal wastes immediately become usable as organic fertilizers, adding another source of savings for the farmers. Since the meats, fruits and vegetables produced are 100% organic, these could fetch better prices.