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Jun 16th
Home Sections MiscellaNEWS Simplified summary or Cliff Notes on: “Protecting Overseas Workers: Lessons and Cautions from RP
Simplified summary or Cliff Notes on: “Protecting Overseas Workers: Lessons and Cautions from RP PDF Print E-mail
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Thursday, 21 February 2008 01:19

Simplified summary or Cliff Notes on: “Protecting Overseas Workers:  Lessons and Cautions from the Philippines”


I am happy to let you know that I read the report done by Dovelyn R. Agunias and Neil G. Ruiz that Freda Contreras uploaded in the Files section and guess what?  I was able to write Cliff notes or summary on their report!!

I must say that this was a report well done; very informative!  Thanks, Dovelyn and Neil.


I uploaded the Cliff notes and also I am copying it here for easy reference.


There is so much that I learned about OWWA from this report.


Dovelyn and all, most of the notes are verbatim since I do not have much time.  I actually used my holiday today to get this out of the way.


This is my small contribution in our efforts to get to know OWWA.


In a separate email, I will send some recommendations or solutions for the purpose of brainstorming.  We can dream, right? 


I hope you find the summary useful and helpful.


Just moving us forward,


Amanda Bueno


Simplified summary or Cliff Notes on: “Protecting Overseas Workers:  Lessons and Cautions from the Philippines” by Dovelyn R. Agunias and Neil G. Ruiz


Part One

February 18, 2008


How OWWA came into being


Government created the Welfare Fund Administration in 1980 which later became the Overseas Workers Welfare Administration (OWWA)


What OWWA is

  1. It is an independent financial agency that manages the welfare fund of overseas workers and provides services to its contributing members like insurance and loans
  1. Essentially a single trust fund pooled from the mandatory $25 membership contributions of employers and workers, investment and interest income, and other sources
  1. Quasi-governmental entity, entirely self-funded, no money from government
  1. OWWA remains the main agency for protecting Filipinos while abroad due to its much larger scope of responsibilities, which extend beyond the provision of legal assistance
  1. An international operation organized by a migrant-sending government

OWWA’s Structure

  1. The Board of Trustees is a tripartite body, DOLE secretary as chair, 12 members representing government, management, and OFWs
  1. The President of the Philippines appoints all board members
  1. Broad representation from departments of foreign affairs, finance, budget
  1. OFWs representation from sea-based, land-based., and women-sector representatives
  1. Overwhelming board members are not OWWA members, a major source of civil society and OFW criticism

Role of Board of Trustees


Plans and implements policies and programs, crafts rules and regulations, oversees fund sources, and creates yearly appropriations for the Secretariat, OWWA’s administrative arm


More notes on OWWA

  1. OWWA has no charter – allows for more flexibility, allows the board to exercise blanket and unregulated authority
  1. Permanent government agency, so, changes to OWWA’s operations can only be made through legislation

Notes on the Secretariat

  1. Headed by an administrator that manages day-to-day operations in RP and abroad
  2. 580 staff members, only about 100 employees are stationed in Manila
  3. 300 are stationed in regional offices in the Philippines or in countries with large number of OFWs
  4. 28 welfare officers were assigned to 16 countries in 2006, more than half in ME, 9 in Saudi Arabia

Welfare Officers

  1. Administrator recommends welfare officers (WO), DOLE secretary nominates and President appoints
  2. WO works with labor attaches and the ambassadors or consul-generals to assist migrant workers
  3. Usually attached to Philippine embassies and consulates

OWWA staff and consulates

Government considers OWWA staff as part of its unified team in that country, with the ambassador as leader


Notes on how to become an OWWA member

  1. Mandatory for migrants leaving abroad through official channels

                        Enrollment upon processing of a contract at POEA

  1. Voluntary registration of a would-be member at a job-site overseas
  2. Membership is valid until the contract expires
  3. For volunteer members, membership does not exceed two years

Membership fees

  1. Ideally, the employer pays the $25 membership fee, a practice that some critics say happens rarely
  2. Membership fee is routinely passed to workers – per a 2004 study by the Scalabrini Migration Center, Manila-based research institute

Note: Some migrant organizations are questioning the authority of OWWA to require such payment


A Profile of OWWA members

  1. A large proportion of temporary contract workers are not OWWA members
  1. May 2007 – OWWA has over a million members representing just 28% of the 3.8 million legal temporary workers abroad in 2006, estimated by the Commission on Overseas Filipinos, another government body – result of extending contracts but not renewing membership

Note: Reasons for non-renewal are not clear and would warrant another study

Balancing act

  1. Right balance between achieving fund stability and providing much-needed services to its beneficiaries is central to operating any welfare fund successfully
  1. OWWA data suggests that the balance has tilted more towards achieving fund stability
  1. 2005- OWWA spent only 3% of the fund balance on services


Mindset of OWWA

  1. Spend less now so more is available for future services; or
  2. OWWA simply underinvesting in services

Save-first-spend-later strategy critical to achieving financial stability


Why OWWA amasses funds


Amassing funds serves two purposes, not explicitly part of OWWA’s policy framework:


1.      Achieve enough of a surplus that the interest income alone will support OWWA’s   annual operating budget.

2.      Reach 10 billion pesos, the amount OWWA would need to repatriate all or most OFWs from the ME in a worst case scenario


   OWWA expects to have the 10 billion pesos by October 2007, then it will be able to spend more on services


OWWA’s role


    As a contingency fund for large-scale repatriation


OWWA’s Income

  1. In the last 5 years, OWWA’s income averaged 1.9 billion pesos or $38 M
  2. Membership fee is 73%, rest from investment income and other income
  1. As of December 2005, investment portfolio is 6.7 billion pesos, $134 million

Where OWWA’s money is invested


Ninety (90%) percent has been entered into an Investment Management Agreement with Land Bank of the Philippines and Development Bank of the Philippines

As investment managers, they are authorized to invest/reinvest funds in government securities, such as Treasury Bills and bonds, the servicing and repayment of which the government fully guarantees for a maximum term of 5 years


OWWA’s expenses

  1. From 2002 – 2006, OWWA spent an average of 865 million pesos , $17 million, per year
  1. 55% went to administrative and operating costs while the rest is spent on programs and projects
  2. Another expensive item in OWWA’s services budget is insurance claims

OWWA provides members with life and personal accident insurance while abroad;

Coverage of 100,000 pesos, $2,000, for natural death and 200,000 pesos for accidental death, burial benefit of 20,000 pesos, $400 is also provided

  1. OWWA charges an additional 900 pesos, $18.00, per year for health insurance
  2. Monetary assistance to workers who suffered work-related injuries, illness, and disabilities during employment abroad
    • Ranges from 2,000 to 50,000 and up to 100,000 for permanent disability
    • 600 OFWs used death and disability benefits in 2002; more than 1,500 in 2006, small number relative to total membership and to the total number/stock of OFWs

Many have private insurance which could explain the low level of claims

Rise of OWWA funds over the years

  1. From 1995-2005, the fund grew nearly four-fold from 2.2 billion pesos, $44 million, to 8.6 billion pesos, $172 million
  2. OWWA’s total assets are more than twice the 2006 annual budget of DOLE, 14 times more than the 2006 budget of its sister agency, POEA

OWWA’s services and benefits

  1. Life and disability insurance
  2. Loans
  3. Education subsidies
  4. Training
  5. Other forms of social-service and family-welfare Assistance


Distribution of resources across benefits


In 2006, OWWA poured more resources into some benefits – repatriation, other forms of on-site assistance, and insurance – while spending less on others – loans, education, and trainings


Backbone of OWWA, according to administrator


Repatriation program – backbone of the agency – facilitates the immediate repatriation of distressed and physically ill contract workers, as well as the remains of those who die while working abroad.


What OWWA does for OFWs

  1. negotiates with employers, brokers, other host-country authorities
  2. facilitates documentary requirements for exit visas, clearances, monetary claims, and medical or police reports
  3. coordinates with Philippine embassies and DFA for other necessary administrative actions and airport assistance
  4. OWWA is instructed by law to maintain other programs, an Emergency Repatriation Fund to evacuate OFWs in case of wars, disasters, or epidemics.

1995 Act allotted a seed amount of 100 million pesos, $2 million, to comply with this law

Other assistance OWWA offers to OFWs

  1. Apart from repatriation, OWWA offers other forms of assistance, services, and programs in its office abroad including counseling for distressed workers, paralegal services, and low-key diplomatic initiatives – negotiations for imprisoned OFWs, hospital and prison visits, sports development projects, cultural and recreational activities, etc.
  2. In 2006, 600,000 members received various kinds of assistance and services
  3. Loan products
    1. OWWA mandated by law to extend loans to overseas workers
    2. Pre-departure loans (PDL) – repayment rate of 29%
    3. Family assistance loans (FAL) – repayment rate of 29%
    4. Livelihood loans
    5. 137 PDLs and 543 FALs were approved in 2006 before OWWA suspended lending pending further evaluation

Note: Reasons for low repayment not clear since no program evaluation has been done; the theory is that OFWs perceive the loans as dole-outs

  1. 4 kinds of scholarship
  2. Mandatory pre-departure orientation seminars (PDOS)

OWWA partners with private sectors and civil society; partners conduct seminars while OWWA prepares materials, sets standards qualifications, and train the trainers

Few benefits from scholarships and training-related programs



There is a part two, abangan!! =)


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Last Updated on Thursday, 21 February 2008 01:31
Comments (1)
1 Thursday, 05 May 2011 07:53
Is owwa board have lifted the suspension of insurance benefits , can I now claim for my health insurance?

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