Pamela Abriam
OCW-NGOs as Interest Groups in Foreign Policy
Thesis Statement: The OCW-NGOs as interest groups had
greatly influenced the Philippines’ Foreign Policy
based on the decisions made by Hong Kong in freezing
the wage cut of its Foreign Domestic Helpers.
I. The proposed wage cut by the Hong Kong Government
A. The facts about the wage cut
1. The conditions of the wage-cut
2. The sectors in Hong Kong who proposed the wage cut
3. The other plans proposed together with the wage
cut]
a. The abolition of live-out arrangements
b. The reduction of quota of FDHs in Hong Kong
B. The reasons behind the proposed wage cut
1. The Asian-financial crisis
2. The high unemployment of Hong Kong
II. Welfare Of OFWs as the Primary Interest Being
Articulated by the Lobbying of Interest Groups in Hong
Kong regarding the Proposed Wage-Cut
A. Overseas Filipino Workers
1. The composition of Filipino OCWs in Hong Kong
2. The conditions of Filipino OCWs in Hong Kong
a. Situation in Hong Kong
b. Salary
B. The Proposed Wage-cut
1. The Direct Effects of wage-cut on the Hong
Kong-based OFWs
2. The Implication s of Wage-cut on the Relatives in
the Philippines
C. Interest Groups as intermediary between the OCWs
and the government
1. The different interest groups involved in the
lobbying anti-wage cut and their principles
2. Migrante International in partnership with the
Unifil-HK as the one that headed the lobbying and the
protests against wage-cut
a. Steps or moves taken
b. Difficulties encountered
c. Evaluation of the Interest Articulation regarding
the Welfare of Filipino OCWs vis-à-vis the proposed
wage cut
d. The real victors contrary to what Patricia Sto.
Tomas and the government claiming
III. The response of the Philippine government to the
Hong Kong wage cut proposal
A. The GMA government’s prior acceptance and support
to the HK proposed wage cut
1. A mendicant Philippine economy
2. Dependence on export of labor
B. The GMA government views the proposed wage cut at
in a macroeconomics level
1. The 15-20% wage cut is better than the job loss for
Filipino migrant workers
2. The Philippine economy is dependent to its export
of labor in terms of foreign remittances
IV. The Significance of Interest Groups in influencing
Foreign Policy
A. Non governmental organizations (NGOs)
1. Birth of NGOs
2. Functions of NGOs
3. On government policies
B. Issues Regarding Migrant Workers
1. Why RA 8042 (Migrant Workers and Overseas Filipinos
Act of 1995) is Ineffective.
a. A domestic policy which aims to address concerns of
Filipinos abroad
b. Just a “crisis-management” response by the
government
2. In pushing other Philippine legislations which 7
million OFWs are asking for
a. Absentee Voting Bill
b. Dual Citizenship Act
C. Proposals for a more sound partnership between the
Philippine government and NGOs in addressing the needs
of the Filipinos Overseas
1. The moves that should be taken by the Philippine
government
2. The moves that should be taken by the NGOs
V. The OCW-NGOs, particularly Migrante International,
as interest groups had greatly influenced the
Philippines’ Foreign Policy based on the decisions
made by Hong Kong in freezing the wage cut of its
Foreign Domestic Helpers.
A. The protest rally done by the NGOs and OCWs last
December 2001 pressured the Philippine government to
make a motion toward the Hong Kong wage cut proposal
B. The cooperation of Migrante International with
Unifil-HK and more than 30 organizations pressured the
Hong Kong government to freeze the wage cut
Pam’s Part
Our group believed that the OCWs-NGOs as interest
groups had greatly influence the Philippine Foreign
policy based on the decisions made by Hong Kong
government in freezing the wage cut of its Foreign
Domestic Helpers or FDHs. As an introduction, this
paper will discuss the proposed wage cut of FDHs by
the Hong Kong government—the conditions of the wage
cut, its proponents and other proposals considered by
the Hong Kong government together with the proposal.
It will also discuss the reasons that the Hong Kong
government gave to justify their proposal of wage
reduction and other proposals as well. Moreover this
paper aims to prove that the reasons used by the Hong
Kong government do not really justify their proposals.
The overall picture is that because of
globalization/neo-liberalization, the Hong Kong
government had come up of these proposals in the first
place.
The Proposed Wage Cut
Last November 2001, the Hong Kong SAR (Special
Administrative Region) Government has been considering
to lower the minimum wage for Foreign Domestic Helpers
(FDHs) by as much as 32%. From the Minimum Allowable
Wage (MAW) of HK$ 3, 670 or equivalent to US$ 471, the
Hong Kong authorities wanted to peg this to just HK$
2, 500 a month (www.bulatlat.com, 2001). There’s no
final decision yet until the review of the salary of
the FDHs is done after that year ends. However, there
were reports that a wage cut would be unavoidable.
Ÿ Other Proposals Considered
While the proposal of wage reduction is talked about,
other proposals concerning the FDHs also considered.
One is the abolition of live-out arrangements given to
FDHs by their employers (www.bulatlat.com, 2001). FDHs
employment contracts currently allow the employers to
either provide sufficient accommodations for the FDHs
in-house or pay for the workers' room/flat where these
FDHs could settle and their transportation costs
incurred when they commute from their place to their
employers’ houses or they run errands. And these
live-out arrangements are greatly preferred by the
FDHs. So the abolition of live-out arrangement would
oblige the FDHs to work in house.
Also, legislator Frederick Fung Kin Kee proposed the
reduction or the limitation in the number of FDHs in
the island to 100, 000. However, this proposal is
under further discussion in the fear that the
reduction of quota could lead to a shortage of
domestics on the island. In 2001, Hong Kong was
reported to be the second largest employer of Filipino
workers with total deployment of 113, 583 workers,
next only to the Kingdom of Saudi Arabia (www.
dole.gov.ph, 2002). POEA (Philippine Overseas
Employment Administration) records show that there are
about 173, 889 Filipinos who are currently working in
Hong Kong.
Ÿ The Second Wage Reduction
If this proposal would be granted, this will be the
second wage reduction made in the last three years.
The first wage cut was made after the turnover of Hong
Kong to China. The wages of FDHs was reduced by 5%,
from HK$ 3, 680 to HK$ 3, 670 in 1999. This was due to
the Asian-financial crisis that affect worldwide in
1997. This was due to Asian financial crisis. From
then on, there were no changes, an increase in wage
cut even when Hong Kong experienced economic growth in
2000.
The Reasons Used to Justify the Wage Reduction
Ÿ The Economic Slump
This wage cut proposal, including the other proposals,
was originally proposed to the legislators by the Hong
Kong Employers of Overseas Domestic Helpers
Association and certain members of the Bureau and
Legislation Council or LegCo. They wanted a wage cut
due to the economic slump of Hong Kong that started in
1997 Asian-financial crisis and came back in 2001.
Economic growth, a healthy 10.5% in 2000, slowed to
just 1.4% in the first half of 2001, and the
government lowered its full-year forecast to just 1%
(Far Eastern Economic Review, 2001). To cope up with
the crisis, the employers wanted to reduce the wages
of FDHs. And the fact that wages of the FDHs became
one of the primary expenses nowadays. This is also the
reason why they proposed the abolition of live out
arrangements. In live-out arrangements, they are
required to provide or pay for the housing conditions
and transportations costs of the FDHs; thus,
eliminating the live out arrangements would cut their
expenses with a fair amount.
Ÿ The Unemployment
Unemployment is said to be another reason for these
proposals. Today, the unemployment rate of Hong Kong
rose to 7.8 (August 21, 2002) in the 3 months to July
as fresh graduates and school leavers poured into the
weak labor market. So the Hong Kong government wanted
to resolve this by creating more jobs for local
people. And one job available for these local people
is the domestic jobs done by FDHs. They wanted to
lower the wages of FDHs so the FDHs would be
discouraged to work in Hong Kong. They argue that FDHs
are "job thieves" of Local Domestic Workers or LDHs.
In their statistics, 87.9% of all the employers in
Hong Kong who hire domestic workers preferred FDHs. In
addition to that, about 7:1 is the ratio of employers
hiring FDHs to employers hiring LDHs. This is also the
reason why some proposed the reduction of quota of
FDHs. In limiting the number of FDHs, the employers
have no other choice but to hire LDHs.
The Reasons that Unjustified the Reasons mentioned
about the Wage Cut
Ÿ The FDHs are not Competing with LDHs
With the given reasons by the Hong Kong government, I
think they are not justifying the proposals of wage
cut and others included. Lowering the wages of FDHs
would not solve or reduce unemployment in Hong Kong.
It would not create more jobs for the local people.
The United Filipinos in Hong Kong (UNIFIL-HK), an
alliance of Filipino migrant organization argued that
there is no basis to prove that the FDHs are competing
with the local labor force (Heyzer, 1989). It is
because FDHs and LDHs address different types of
households. Local people could not and would not
accept the working conditions of FDHs.
Foreign Domestic Helpers in Hong Kong do most of the
household chores. Most of them are even made to engage
in non-domestic works, which are beyond the provisions
of their contracts. Some serve two families, while
others are required to work part time in their
employers’ factories, shops or officers, often without
due compensation. Other problems are low wages or
under payment, nonpayment of the benefits and other
fess, denying rest days and holidays, limited n umber
of hours for rest, prohibited to use the telephone,
and not being allowed to see visitors (Heyzer, 1989).
Also because of live-in arrangements, the foreign
domestic helpers are vulnerable to abuses—physical,
verbal or sexual abuses.
With those conditions, who would want to fill the jobs
of FDHs? Can the LDHs do the sacrifices done by FDHs?
I don’t think so. It’s because these LDHs would not
agree to full-time services because they have their
own domestic job to do in their own houses. Statistics
prepared by Asian Migrant Center shows that only 1.5%
of the Local domestic Workers were interested in the
profession. 69.8% of them were not prepared to work
full time and 64.6% wish to stay overnight. Also only
34.7% of the employers hire LDHs because of the ease
of communication.
Ÿ The Advantages of Hiring FDHS than LDHs
The employers also prefer FDHs, specifically
Filipinos, not only because of lower wages but also
because FDHs are mostly educated. Forty to fifty
percent of the Filipino contract workers are former
schoolteachers and medical workers. Most of them at
least graduated in high school education and some are
even college degree holders. So they speak better
English, which the employers enjoy because they
benefit in the learning and practicing English. The
FDHs would teach the employers’ children to speak
English.
Since also the FDHs endure live-in arrangements, the
employers could have time to go out and socialize and
more time for herself and for her husband. And not
only that… revenues that the Hong Kong gets are in the
form of security bonds, taxes imposed on the
flourishing agencies related to the import of workers,
such as the recruitment and travel agencies, airlines,
basks, communication services, insurance companies,
consumer goods sector, photo shops and the like
(Heyzer, 1994).
Ÿ The Law of Demand and Supply
Lowering the wages would in fact increase the demand
for the FDHs, from the point of view of Law of Demand
and Supply. Due to lowered wages, other households who
before, cannot afford to hire domestic helpers, now
can hire domestic help. Also, the fact that LDHs have
higher wages than the FDHs, the LDHs were not
considered desirable or demanded by these employers. I
think the Hong Kong government should do the other way
around—increasing the wages of FDHs so that the
employers would be discourage to hire them.
Since I mentioned earlier that other households could
now afford to hire FDHs due to lower wages, the women
of these households could work now and thus adding a
labour force to her family. Addition to the labour
force means greater production and, therefore, greater
growth in the economy.
So instead of wage cut of FDHs, the coalition for
Migrants rights (CMR) and Asian Migrant center (AMC)
strongly urge the Legco panel on Manpower and the
Education and manpower Bureau to devise more effective
solutions to promote LDHs by consulting with labor
support ally, unionist and both the local and foreign
workers. By hearing the opinions of the affected
groups themselves, policy makers will be reminded on
the necessity to stick to their desired objectives,
namely to advance the welfare of local domestic
workers, not to decrease the security of FDHs. Also,
instead of wage cut of FDHs, the Hong Kong should
consider the wage cut of those high-ranking officials
or high salary earners. The FDHs in Hong Kong are the
lowest paid domestic helpers in the world! So, why
should they have to be given a wage cut? They’re wages
are not worth of their working skills. They work 16
hours a day and are always on call 24 hours! If
calculated, HK$ 3, 670 is not enough. Why are they
always first to suffer if there’s an economic slump?
The Whole Picture is due to
Globalization—Neo-Liberalization
Before we tackle the problem of globalization and
neo-liberalism, we must first define what is the
meaning of Neo-liberalization. According to Elizabeth
Martinez, a long time civil rights activists and a
book author, “Neo-liberalism” is a set of economic
policies that is used to globalize the world
(www.aidc.org.za/archives/what is neo-lib.html, 2002).
The main points of neo-liberalism are deregulation,
privatization, unregulated market where there’s no
price controls, and elimination the concept of the
“public good”.
Neo-liberalism or the Washington consensus has become
the new paradigm of imperialist in order to open new
markets for investments. Open economies were the most
vulnerable to global downturn. How? First, the trade
and investment are monopolized by the big foreign
companies through privatization of state assets and
services and removed the regulations that prevent the
greater monopoly integration and control and higher
profits. Thus, these monopoly corporations would kill
off the local enterprises, which are in no position to
compete. And since there’s no intervention by the
government, the overall result of globalization is the
destruction of the domestic economy, the massive loss
of jobs and livelihood, and the domination of foreign
monopoly corporations (Tujan, 2001).
From that we can prove that it starts from
globalization that uses neoliberalism. With the
globalization, there’s a monopoly of businesses by
foreign companies. And this monopoly of business by
foreign companies would be able to kill individual,
local companies. Thus, stripping the employees of
these local companies of their jobs. That may lead to
an increase in unemployment rate in the country. And
because of unemployment that most people migrate to
other countries, looking for greener pastures. So
that’s why FDHs are increasing in number particularly
in Hong Kong that their government sees that as a
threat to their local employment. If in fact, they
were not globalized, they would not have to worry for
the FDHs to “replace” their local people in some jobs.
They would not have the problem of unemployment to
complain about.
Also, because of globalization/neo-liberalism, the
technology today is far more advance that it reduces
the capability of the man to operate them. I’m
referring to the machines used now by corporations in
handling the production processes. These machines
replaced the capable people thus putting them into the
unemployed, increasing the unemployment rate. So
increasing unemployment is really one of consequences
of globalization.
The Recent Moves by the Hong Kong Government
Last January 31, 2002, the Hong Kong SAR (Special
Administrative Region) government announced that they
would freeze the wages of Foreign Domestic Helpers
(FDHs) instead of reducing them. The FDHs were
relieved for only now because the freezing of the wage
is only temporary, it depends on the market forces of
Hong Kong. But for now, together with NGOs based in
Hong Kong and Migrante International, they had voiced
out their rights and won.
However, last May 31, 2002, the Hong Kong government
is now considering four proposals to provide greater
job opportunities for local or Chinese domestic
helpers. According to the POEA, the Philippine
Overseas Employment Administration, the said proposals
include freezing the present number of FDHs, levying
taxes on Hong Kong employers hiring FDHs, subsidizing
the Hong Kong employers hiring LDHs, and increasing
the minimum wage of FDHs.
The POEA Acting Administrator Berciles announced that
the Hong Kong would only allow the entry of FDHs only
to take care of the elderly parents, handicapped
children, or newly born babies. However, Berciles
reported that the subsidizing the hiring of LDHs and
increase the wages would not work out against the
economy due to the government’s large budget deficit
(www.dole.gov.ph, 2002).
From these proposals, it proves that reducing the
wages of FDH is not the best answer to the Hong Kong
problems. That fact that they had proposed an increase
in wages proves that they had seen the picture in view
of Law of Demand and Supply, which I pointed out
earlier.