Pass the PRESENT Bill now! We support innovative and peaceful pathways to end Poverty!

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The Poverty Reduction Through Social Entrepreneurship (PRESENT) Bill

The PRESENT Bill primarily aims to acknowledge and support Social Enterprises for their role in poverty reduction. It includes tax provisions, incentives, and a governing body that will create an enabling environment for social enterprises to thrive and uplift more people out of poverty.

The COVID-19 pandemic has resulted in unprecedented health, economic, and social crisis affecting the most vulnerable sectors. Given the existing inequalities in society, the crisis has exacerbated the gap between the rich and the poor. Social enterprises will be critical to our response and recovery from the Covid-19 crisis. Half a billion people across the globe are expected to fall into poverty and indicators in the Philippines have already shown that this is a likely scenario for many of our people. 

I. What are Social Enterprises?

Social Enterprise or SE refers to primarily a social mission-driven wealth-creating
the organization, however, organized, whether as a non-stock non-profit including NGOs, POs, Foundations, Associations; cooperatives, sole proprietorship, partnerships, corporations, established to improve societal well-being as well as ecological sustainability. A social enterprise for purposes of this act shall also mean a Social Enterprise with Marginalized Sectors as Primary Stakeholders (SEMPS). 

II. Key Features of the PRESENT Bill

1. Recognition of Social Enterprises (SEMPS)

SEMPS are social enterprises that explicitly declare and pursue poverty reduction or improving the quality of life of specific segments of the marginalized sectors as a principal objective. A SEMPS engages and invests in the poor to become effective workers, suppliers, clients, and/or owners, and ensures that a substantive part of the wealth created by the enterprise is distributed to them. 

In addition to reinvesting its surplus or profits back towards the fulfillment of its social mission in a sustainable way, a SEMPS also uses its surplus or profits and mobilizes other resources to assist the poor to become partners in SE or value chain management/ governance and to become partners in community, sectoral and societal transformation.

2. National PRESENT Program: strategic economic sub-sectors as units of planning 

The planning framework of the PRESENT Program and its planning process shall ensure that the marginalized sectors are engaged as primary stakeholders. It shall add value and complement ecosystem-based, area-based, community-based and other tools and processes in local economic development by promoting and utilizing the economic subsector as a strategic unit of analysis and planning SE development interventions. 

The PRESENT Program shall identify and develop key SEMPS and resource institutions as partners in strategic economic subsectors that have the potential for growth and where large numbers of the poor are concentrated.  SEMPs shall be developed as vehicles to ensure that the marginalized sectors benefit the most from sustainable subsector development.

3. Qualification of SEMPS 

To qualify for the benefits and incentives provided for in this Act, the SE shall:

Provide or facilitate the provision of a combination of transactional and/or transformational services to improve the position and benefits derived by the poor from the SE and the value chain or economic subsector where the SE is located;
Invest a substantive part of its surplus, profits or mobilize other resources to assist the poor to become partners in SE or value chain management/governance and/or to become partners in community, sectoral and societal transformation; Make a proactive contribution to resolving social and environmental problems and generate profit or surplus with due regard to social and environmental costs; Be engaged in economic activity within the sectors of agriculture and fisheries, industry and services which, for purposes of this Act, shall refer to an activity in any of the economic subsectors; Ensure that a substantive part of the wealth created by the enterprise is distributed to the poor in the form of services, dividends and other forms of benefits, and payments and incentives for products or services rendered consistent with the principles of fair trade;  Be duly registered with the appropriate agencies as provided under the Corporation Code or the Cooperative Code of the Philippines, Magna Carta for Micro, Small and Medium Enterprises, Barangay Micro Business Enterprises Act, Microfinance NGOs’ Act, and other laws;

4. SE Support Programs

SE Capability Building and Sustainability Program - this program shall include training in social entrepreneurship development, institutional strengthening, human resource competency and skills training, business planning and advisory services, upgrading of accounting and auditing systems, technical assistance for the installation or improvement of management information systems, technology intervention, technology incubation/commercialization, market studies, and product development competitiveness, business matching activities, trade fairs and missions, policy advocacy, disaster-resiliency, and other related activities. 

Social Enterprise Recovery and Rehabilitation Fund - in light of extreme disasters and pandemics, a Social Enterprise Recovery and Rehabilitation Fund is hereby established for financing programs and projects supporting adaptation and resilience of social enterprises, including stimulus grants. The Fund shall be lodged under the Department of Trade and Industry.

5. Incentives for SEs and Social Investors 

Special Credit Windows with non-collateralized loans – in addition to the special credit windows provided for the promotion of microfinance as provided under Section 16 of RA 8425, the Land Bank of the Philippines, Development Bank of the Philippines, Philippine Postal Bank, and Al Amanah Bank, and other public or government-owned banks are hereby mandated to set aside at least ten percent (10%)  of their total loan portfolio based on their balance sheet at the end of the preceding quarter over a period of five (5) years and open a special credit window for qualified SEs. 

The SE Development Fund shall provide grants to qualified social enterprises and resource institutions for the performance and conduct of their mission towards poverty reduction, promotion of social justice, and improvement in the economic welfare of the poor and marginalized sectors. 

Strengthening of the Agriculture and Fisheries Credit Policy – In addition to the special credit window provided above, at least ten percent (10%) of the funds created under Section 6 of RA 10000, otherwise known as "The Agri-Agra Reform Credit Act of 2009," is mandated to be set aside by all banking institutions, whether government or private, for SEs engaged in agriculture and fisheries activities as credit.  

All SEMPs duly certified by the Council, in consultation with the Department of Finance (DOF) and the Board of Investment (BOI) of the DTI, shall be exempted from the payment of VAT, tariff, and duties for the importation of all types of product inputs, equipment, machinery, implements, and spare part

6. An appropriate government structure 

Lead Agency – The Department of Trade and Industry (DTI)  shall serve as the central planning, coordinating, implementing and monitoring body of the program. In order to have a cooperative and effective function, DTI as lead agency should work closely with other government agencies in order to fulfill the Act’s purpose.  To carry out the policy declared under this Act, a Social Enterprise Development Council (SEDC) is to be created attached to DTI.

The Council shall be composed of the following: 

Secretary of Trade and Industry, as chairperson
Secretary of Agriculture, as co-chairperson
Secretary of Social Welfare and Development, as vice chairperson
SE sector head representative, as co-vice chairperson
Office of the President
Director-General of the National Economic Planning and Development Agency
Lead Convener of the National Anti-Poverty Commission
Secretary of the Interior and Local Government
Secretary of Finance
Governor of the Bangko Sentral ng Pilipinas
Secretary of Environment and Natural Resources
Secretary of Agrarian Reform
Secretary of Science and Technology
Secretary of Labor and Employment
Secretary of Education
Secretary of Transportation 
Secretary of Information and Communications Technology 
Chairman of the Commission on Higher Education
Chairman of the Cooperative Development Authority
Chairman of the Securities and Exchange Commission
Director-General of the Technical Education and Skills Development Authority
Nine (9) representatives from SEMPS, three (3) representatives each from the main island groupings of Luzon, Visayas, and Mindanao.

A National Center for Social Enterprise Development (NCSED) under the Council shall be established and should serve as respective functions such as 1.) Provide SEMPs with capability-training and education through the Social Enterprise Capability Building and Sustainability Program; 2.) Develop and enhance a research and development system which shall equip every SE with innovative and sustainable approaches; 3.) Manage a Social Enterprise Marketing Assistance Program (SMAP); 4.) Implement Capability Building Projects as approved by the Council.

7. A budget that supports the PRESENT Program and SE development through hybrid financing

Hybrid financing shall refer to the combination of grants with loans and other financial instruments to support the unique nature of SEs as wealth-creating organizations that pursue social missions to improve societal well-being - in ways that are ecologically and financially sustainable

Given the unique nature of SEs as wealth-creating organizations that pursue their social mission to improve societal well-being in ways that are ecologically and financially sustainable, they need to be supported through hybrid financing that entails a combination of grants with loans and other financial instruments. 


PASS THE PRESENT BILL NOW! We urgently call EVERYONE to SUPPORT this online petition to pass the PRESENT Bill now! 

#PassThePRESENTBillNow  #PRESENTBill2021  #PRESENTCoalition #SDG2030 #AMBISYON2040

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