Punongbayan: Philippine-style decentralization has been a big failure
Posted September 23, 2020
With the recent submission to Congress of the 2021 Budget, the issue of the implementation of the Supreme Court decision in 2018 of including 40% of the customs duties collected by the Bureau of Customs to the Internal Revenue Allotments of the LGUs has rang a louder tone. The present IRA is calculated at 40% of the BIR collections only, excluding customs duties.
The IRA resulted from the Local Government Code of 1991, the law that decentralized local government development functions to the LGUs themselves.
Ben Punongbayan, chairman and founder of Buklod, a national political party, said decentralization of government is always a good state policy because the local government units understand their situation much better than the national government leaders and, therefore, theoretically, the LGUs can do a better job of developing their own locality.
However, he expressed that the Philippine-style decentralization has been a big failure. After a long 29 years, there is nothing much to show. Much of the countryside is still in a sorry state. Provincial and town road infrastructure and networks, including bridges, garbage collection and disposal, sewerage system, flood control system, irrigation system, agriculture extension services and the like are inadequate or not existing at all. Moreover, those that have been developed are generally poor in quality.
That is not to say, according to Punongbayan, that decentralization should be reversed. On the contrary, he believes it must be strengthened and vastly improved. And for this matter, the implementation of the SC decision provides a good opportunity to make great improvements. The IRA included in the 2020 budget amounts to P649 billion. If the 40% of the 2017 collection of customs duties (basis for IRA is tax collections of three years ago) is added to it, the total would amount to P786 billion, which is a big sum and if properly and efficiently spent, it will go a long way and the results should show.
First of all, to match somehow the increase in IRA, it is reasonable to decentralize some other national government functions. A good one is to assign to the provinces and cities the responsibility for providing all the necessary physical infrastructure (school buildings, desks, etc.) to support elementary and high school education in their respective jurisdictions. Depending upon the total amount involved, the salaries of teachers and their supervisors may also be included. Bringing down these responsibilities may make their execution easier and more effective.
But much more than this, Punongbayan said substantial changes must be made to greatly improve the present decentralization system. First and foremost is to draw up a clear division of responsibilities between the national government and the provinces/cities, on one hand, and between the province and its various municipalities, on the other hand.
Right now, a clear division of functions does not exist and therefore a wait-and-see attitude and neglect prevail such that much of the allocated money is spent somewhere else. It is not difficult to see why. A road or bridge in a municipality necessarily connects to another municipality and so on. A provincial road may connect to another or a few other provinces. A flood control system cannot just be confined for use and to provide benefit to a municipality or even to a province. Because of its physical and geological characteristics and its big scale, it necessarily covers a wider geographical area. And so with an irrigation system, a sewerage system, a solid waste disposal system and the like.
But if one reads the Local Government Code, each of the municipalities, cities and provinces have been given the same responsibilities in their respective areas. So, who decides who does what?
To cite a very simple example just to portray clearly this issue, there are many places in a municipality that need a public toilet. Maintaining proper sanitation is a responsibility imposed on the barangay, the municipality and the province. But those public toilets are not built and, as a consequence, the affected citizens use the river or some corner as their toilet. The irony is that constructing one does not cost much. But who should construct them? The barangay? No, that’s the responsibility of the town, the barangay says. No, that’s the responsibility of the province, the town says. No, that’s the responsibility of the barangay or the town, or better still, the national government must develop and implement a national program for public toilets, the province says.
The other must-do improvement is a requirement for providing transparency by the LGUs on their use of their IRA. Most of our citizens may not be conscious of the fact that most of the funds of each LGU comes from national taxes and not directly from the citizens of that LGU. So they are not aware that their local leaders must account for those money.
The local leaders have to be made clearly accountable for their IRA funds. The first step is to disclose to all citizens the IRA allocations of their respective barangay, municipality and province. And the second step is to require each LGU to make an annual report of how its IRA and its own tax collections were spent. These disclosures can be made through the websites of the national government and of each of the LGUs.
Another important issue is the need to re-conceptualize the role of the barangays. Right now, the barangays are another layer of government, the lowest one. For that role, the barangays get 20% of the IRA and a share of the real estate tax collections in their geographical area. For their IRA alone, the total amounts to P130 billion for 2020.
According to Punongbayan, the present role of the barangay must be changed. A barangay should not have a government function; it should just be structured as a community service – to help keep the peace and maintain harmony and order in the barangay. As such, wasteful dissipation of tax money will be avoided and bureaucracy, together with its attendant graft, will be lessened.
Punongbayan concluded by saying that, by all means, the SC decision has to be implemented to keep faithful with the decentralization policy. “However, before doing so, the Local Government Code must be amended to incorporate all the necessary improvements to make decentralization really work in the way it must work.”