The Supreme Court in Mandanas v Ochoa increased the share of national funds dedicated to local government units (LGU). Article X, section 6 of the 1987 Constitution stipulates that “local authorities shall have a fair share, as determined by law, of the national taxes which will be automatically released to them”.
This development means a substantial increase in the Internal Revenue Allotment (IRA) prescribed by the Local Government Code of 1991 (LGC) which will come into effect in 2022. Starting next year, the IRA of each LGU (including the barangays) will be significantly higher than what they have received in recent years.
It’s tempting to just be thrilled with the Mandanas decision given that most LGUs are heavily dependent on the IRA for their operations. A study on LGU ARI dependency rates conducted by the Ateneo School of Government found that a majority of provinces, cities and municipalities depend on IRA for more than 50% of their budgets. And a significant number of these LGUs depend on IRA for more than 90% of their local budgets.
However, this increase in IRA also meant a decrease in the amount of funds that could be used by the central government. Encourage the administration of President Rodrigo Duterte to review the administrative decentralization prescribed by the LGC with the publication of Executive Decree No.138 – Complete devolution of certain functions of the executive to local governments, creation of a committee on decentralization and other purposes.
Mandanas expanded the LGU’s IRA, while EO # 138 expanded the scope of their responsibilities. And since its publication, the entire government bureaucracy has worked to lay the groundwork for “full decentralization” which should begin when the Mandana increase begins next year. Every Filipino will be affected by this massive reform effort and therefore must understand how this process works. A good start would be to internalize section 2 of OE # 138:
“Section 2. Guiding Principles. In accordance with Articles 3 and 17 of RA 7160, all department secretaries and heads of agencies concerned must, as part of the full devolution of functions to LGUs, carry out a functional and organizational review of their respective mandates guided by the following principles:
a. The role of the GN is to define national policy, development strategy and service delivery standards, and to assist, supervise and supervise LGUs, complementing the stronger implementation role that LGUs must assume in reason for decentralization;
b. The devolution of the provision of basic services and facilities to LMUs and the determination of functional remits between and among the different levels of government will be guided by the following:
I. Public services with little or no benefit spillovers are better administered and funded by lower-level governments, while public services with significant interjurisdictional externalities or benefit and cost spillovers are better allocated at higher levels of government ;
ii. The provision of public goods and services that involve economies of scale is best entrusted to higher levels of government; and
iii. Functions linked to the redistributive role of government should be better attributed to the GN;
vs. The GN, in close collaboration with the LGUs through their respective leagues, will formulate and pursue an institutional development program to support the LGUs in order to strengthen their capacities and their capacities to fully assume the functions devolved on the basis of RA n ° 7160 and other relevant laws. ; and
D. Unless otherwise provided in this decree, any ambiguity as to the interpretation of a power granted to an LGU must be resolved and interpreted in favor of devolution.
EO # 138 is clearly aimed at fundamentally reconfiguring the way government works. The first point to emphasize here is that the transfer of programs and tasks from national government to LGUs will certainly affect every elected official in 2022. Therefore, it makes sense to require candidates to ensure that their proposed policies and plans are met. in accordance with the devolution process described in OE # 138.
For example, the simple promise of using huge urban centers like Cebu City as regional development centers will not be at all credible if it is not accompanied by an explanation of how this plays out in the context of EO # 138. Promises made by candidates, especially those relating to economic reforms, must include an account of their congruence with the decentralization process prescribed by EO # 138. Otherwise, voters should treat both the candidates and their campaign statements with a fair amount of skepticism.
In addition, voters should also realize that more judgment is needed when voting for local elected officials given the profound impact of EO # 138 on local governance. Obviously, the success of “full decentralization” depends heavily on the quality of local leadership. Raising the IRA will be pointless if incompetent people are elected to lead LGUs. At a minimum, voters should ensure that candidates at the local level truly understand the requirements of EO # 138.
Finally, EO # 138 requires that the development goals of national government and local governments be well aligned. In the long term, an ethic of collaboration between the two levels of government must evolve. Therefore, a vital question voters need to ask all presidents is who will they appoint as the head of the Home and Local Ministries and the Budget and Management Ministries if they win in 2022. ? These two positions are vital as they co-chair the Committee on Decentralization, the body entrusted by EO # 138 with overseeing and controlling the implementation of the decentralization process.
The reality is that the decentralization process described in EO # 138 can only achieve the desired result if central government officials and local leaders demonstrate the willingness to cooperate and coordinate. Therefore, voters must determine now who are the political leaders who are likely to embrace this governance mindset. And then categorically reject those who cannot.
(The author is a political and constitutional analyst, and a senior researcher at the Ateneo Policy Center and the Institute for Autonomy and Governance.)
Disclaimer: The opinions expressed in this blog are those of the blogger and do not necessarily reflect those of ABS-CBN Corp.