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10th Year of the German Support to Good Governance and Decentralization in the Philippines

22 March 2013

Speech of Senator Ferdinand R. Marcos, Jr.
Delivered at the International Conference Marking the “10th Year of the German Support to Good Governance and Decentralization in the Philippines”
Mandarin Oriental Hotel, Makati City

Your Excellency, Joachim Heidorn, Ambassador of the Federal Republic of Germany to the Philippines, Honorable DILG Secretary Mar Roxas, distinguished resource persons to this International Conference of the German Development Cooperation (GIZ), the Head and staff of the UP Center for Local and Regional Governance, ladies and gentlemen:

I consider it a singular honor to have been invited as your keynote speaker this morning for this very important International Conference on the Decentralization Program of the German Development Corporation (GIZ). I understand that this is the 10th year of the German Government’s support to the Program on Good Local Governance and Decentralization in the Philippines, and I certainly hope that this will not be the last as this is indeed a very significant contribution of the German government to the development efforts of the Philippines, focused on improving local governance.

In this connection, I will try my very best to effectively share my thoughts on this very important subject of local governance in our current driver towards accelerated nation building.

Before I continue, let me commend the German Government, through their embassy officials here in the Philippines for mounting this international conference in coordination with the UP Center for Local and Regional Governance of the University of the Philippines.

At this point, ladies and gentlemen: allow me to start by citing the Constitution, particularly Article X, Sec. 3, which laid down the basic foundation for building a strong local government structure and it reads as follows:

“The Congress shall enact a Local Government Code which shall provide for a more responsive and accountable local government structure instituted through a system of decentralization with effective mechanisms of recall, initiative, and referendum, allocate among the different local government units their powers, responsibilities, and resources, and provide for the qualifications, election, appointment and removal, term, salaries, powers and functions and duties of local officials, and all other matters relating to the organization and operation of the local units.”

For this morning’s keynote, I thought I would divide my speech into two (2) parts: The first: My understanding of the decentralization in the Philippines in the context of good governance. The second part will briefly dwell on the initiatives I have introduced with the assistance of my colleagues in the Philippine Senate as Chairman of the Committee on Local Government towards furthering and improving the effectivity of the decentralization as provided for in the Local Government Code of 1991, thereby bringing about better governance.

In October this year, we shall be commemorating the 22nd anniversary of the enactment of Republic Act 7160, otherwise known as the Local Government Code of 1991, which is considered to be the “most revolutionary piece of legislation ever crafted by Congress since 1987 within the framework of the 1987 Constitution.”

As everyone in this hall knows, through this law, the Central Government has devolved to the Local Government Units (LGU’s) political, social as well as economic powers. It provides financial wherewithal to the LGUs to help them unlock development opportunities in the countryside.

Allow me then to review with you some features of the Local Government Code which will provide us a clearer view of the importance of the Code, since it is now referred to today as the Bible of Local Governments. These are the following:

• It devolves to the LGUs delivery of basic, actual, and direct services as well as certain regulatory powers;
• It significantly increased the financial resources available to the local governments by increasing their shares in the Internal Revenue Allotment;
• LGUs get an equitable share of taxes in the utilization and development of the national wealth;
• It broadens the taxing and revenue raising powers of the LGUs;
• Each LGU is authorized to design and implement its own organizational structure and staffing pattern, taking into consideration its governance and service requirements as well as its financial capability;
• It provides for the participation of the private sector in local governance;
• Furthermore, LGUs are granted authority to secure loans, credits and other forms of indebtedness to finance their development programs, in accordance with guidelines issued by the national government.

Needless to say, the foregoing, if properly implemented by the LGUs, are expected to bring together the different stakeholders into the planning table and to actively involve them in the different development processes that should result in a more rapid progress of their respective localities.

II. Good Governance

In all these, as experienced by most LGUs, good governance is the key that opens vast opportunities for rapid development especially in the countryside.

Governance is defined by the United Nations Development Programme (UNDP) as “the exercise of political, economic and administrative authority to manage a nation’s affairs. It is the complex mechanisms, processes and institutions through which citizens and groups articulate their interests, exercise their legal rights and obligations, and mediate their differences.” (Source: website of ADB Institute).

In addition, as reprinted in your program for today, former UN Secretary Kofi Anan once noted that “good governance is perhaps the single most important factor in eradicating poverty and bringing about priority development.”

In my fifteen (15) years as a local executive both as Governor and Vice Governor in the province of Ilocos Norte, I’ve come to the conclusion that good governance, to be put in place, entails sound management of public resources that would guarantee full exercise of human rights and ensure optimum growth and development. In addition, it involves sound decision-making and the corresponding proper implementation of promulgated policies and programs.

Thus said, the following key elements of good governance have been identified by successful LGUs and allow me to reiterate them at this time:

A) Transparency –

Transparency means the availability of accurate information to the general public and the articulation of government rules and regulations, and decisions. IT is herein implied that copies of rules and guidelines for the conduct of business in the different LGUs for the information of different stakeholders should always be readily available to all.

Accountability and transparency in government transactions work hand in hand. Information from relevant local officials on matters concerning procurement of equipment and materials including those needed for the delivery of basic services that have been devolved to the LGUs, as well as the implementation of infrastructure projects where public biddings are required, are essential elements in responsible public service.

B) Accountability

Accountable and responsible governance provides an effective mechanism to address complaints and grievances against public officials.

Under our national laws, the people have two alternative courses of action when dealing with erring local officials.

First, the legal remedies covering all local officials, whether elected or appointed, as provided for under the following laws:
A) R.A. 7160 or the Local Government Code of 1991;
B) R.A. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act of 1960;
C) R.A. 6713, the Conduct and Ethical Standards for Public Officials and Employees of 1989; and
D) R. A. 6770, the Ombudsman Act of 1989.

Second, the political remedies which cover only elected officials –
A) People can directly punish erring local elective officials through the process of recall under the Local Government Code.
B) In the process of recall, the Code requires that at least twenty five percent (25%) of the total number of registered voters of an LGU can validly initiate recall proceedings against incumbent elected officials for lack of confidence.
C) No recall shall take place within one year from the date of the official’s assumption to office or one year immediately preceding a regular local election.

C) Participation -
As we all know the principle of participation is anchored on the basic fact that people are the very heart of the nation’s development. They are not only the ultimate beneficiaries of progress, but are also the agents of innovation and advancement in the society, through their active involvement in the policy and decision-making process.

The principle of participation is now enshrined in the 1987 Constitution under Article XIII, Section 16 which provides for; and let me quote: “The right of the people and their organizations to effective and reasonable participation at all levels of social, political, and economic decision-making shall not be abridged. The State, shall by law, facilitate the establishment of adequate consultation mechanisms.

One of the enabling laws that implements this constitutional mandate, R.A. 7160 provides the mechanisms whereby the private sector is enabled to participate in policy formulation and development planning.

a) On Legislation –
R.A. 7160 provides, among others, for representation in all Sanggunian levels from each of the following sectors: A) the Women sector, B) the Labor sector (Industrial or Agricultural), and C) a representative from any of the following sectors: the Urban Poor, the Indigenous Cultural Communities, the Disabled Persons, or any other sector as determined by the Sanggunian concerned X X X. The rules and regulations to effectively provide for the election of such sectoral respresentatives have been promulgated by the Commission on Elections (Comelec).

This provision of the Local Government Code implements Section 9, Article X of the Constitution which provides that legislative bodies of local governments shall have sectoral representations as may be provided by law.

It is unfortunate, however, that this provision of the Code has never been implemented. The Comelec, as the implementor of this provision, promulgated on October 22, 1993, Resolution No. 2515, which prescribes the rules and regulations covering the first elections of Sectoral Representatives.

The first elections of the Sectoral Representatives to the Sangguniang Panglungsod and Sangguniang Bayan had originally been scheduled on March 26, 1993, and the Sangguniang Panlalawigan on April 16, 1993. Regrettably however, no elections were ever conducted.

B) On Development Planning

A new paradigm shift in planning has now been adopted. Local Development Councils are created in all LGU levels by the creation of Provincial Development Councils (PDC); City Development Councils (CDC), Municipal Development Councils (MDC) and Barangay Development Councils (BDC).

The Code provides that at least twenty five percent (25%) of the total membership of the different Local Development Councils should come from the private sector.

As laid down, the planning process starts from the Barangay Development Council. The approved development plans of the BDCS are then submitted to the National Economic Development Authority (NEDA) through the MDCS, PDCS, and the Regional Development Council (RDC). The approved development plans, therefore, of the different LDCS are expected to be integrated into and form part of the national development plan.

D) Predictability -

The consistent application of laws, rules and regulations creates an orderly society. It would be extremely difficult if laws are not followed, or if there is no discipline in its implementation.

Investors, for instance, would find it most difficult if rules would be constantly amended, and specifications on projects already started would be abruptly changed.
It is important to emphasize that the four elements of good governance as stated in the foregoing: transparency, accountability, participation, and predictability, are not enough to ensure strong and good local governance.

Let me add two (2) more important elements which are necessary to make local governance truly effective:
First: the need for value-based and value-driven leadership, and second, the need for a genuine and meaningful local autonomy which the constitution has aptly provided by way of the following provisions:

A) The State shall ensure the autonomy of local governments (Section 25, Article II)and value; and
B) The territorial and political subdivisions shall enjoy local autonomy. (Section 2, Article X).

Thus, the true meaning of local autonomy could be achieved if governance is more directly responsive and effective at the local levels. Through devolution of powers, it is aimed that the local governments will be able to chart their own destinies and make their lasting imprint in the arena of public service.

Let me stress that as duly elected local government officials, the mandate of Governors, Mayors and Barangay officials under the code, is for “a more responsive and accountable local government structure instituted through a system of decentralization…..”

This mandate grants local government officials tremendous powers and awesome responsibilities. Through the system of decentralization, LGUs are provided with the exercise of inherent powers granted to the national government such as police power, the power of taxation and the power of eminent domain.

These expanded powers are granted to local governments under the 1987 Constitution as a means of ensuring that local governments, through their local officials, are held primarily responsible for their security, social services and economic development.

Let me call your undivided attention to these expanded duties and responsibilities which local representative officials are expected to legislate. These duties and responsibilities came about as result of what we call “devolution”

Let me run through some of these very quickly:

1. Agriculture
a. In general, provide support and extension
services for agricultural production and marketing;
b. Distribute seeds; (planting materials)
c. Operate stations; to collect or buy farm

2. Health
a. In general, deliver basic health services;
b. Promote general hygiene;
c. Promote sanitation;
d. Construct and maintain health centers;
e. Provide solid waste disposal systems.

3. Environment
a. Beautification;
b. Solid waste collection and disposal.

4. Infrastructure
a. Maintenance of
• roads and bridges
• water system & drainage.
B. Construction and maintenance of:
• multi-purpose pavements,
• halls,
• sports centers,
• information and reading centers,
• satellite or public markets (where viable).

5. Social welfare
a. Social welfare services,
b. Day care centers.

It is clear, my partners in development, that like us in both Houses of Congress, local government duties and responsibilities could only be discharged by enacting ordinances, policies and programs for their respective constituencies. The local executive, after all, cannot act without legislation.

The LGU executives are the ones who know their respective problems and it is therefore expected that after diligent study and careful analysis conducted by them, they should also know and be able to identify the proper solutions. This is also expected of them as local legislators. Thus the colatilla, ‘in aid of legislation.”

But even as they are mandated to develop plans, programs and priorities, they are also granted by the Constitution the inherent power of taxation, a vital power which, with your permission I wish to reiterate:

Section 5, Article X of the constitution reads: Each local government unit shall have the power to create its own sources of revenues and to levy taxes, fees and charges subject to such guidelines and limitations as congress may provide, consistent with the basic policy of local autonomy. Such taxes, fees and charges shall accrue exclusively to the local governments.”

The power of the purse is considered as one of the biggest challenges to LGUs and the national legislators. We create our own sources of revenues in order for us to utilize what we raise for the benefit of our constituencies. We are expected to balance revenues with expenditures that whatever is earned is properly spent, with emphasis on the words properly spent.

All taxes, levies, fees and charges raised whether national or local must go back to our constituencies, whether in the form of economic development or social services, not to mention the all important aspect of security.

My friends. It is said that legislative bodies represent the hopes, the dreams and the desires of our constituencies, including some of the frustrations that go with public services. This is a tall order but a real one!

More than the executive, legislative bodies represent diversity of interests therefore resulting in different concerns, at times conflicting! This to my mind is the beauty of legislative bodies, where needs, concerns and views of varying differences are fully debated on and clarified. In essence, legislative bodies represent the people. It is where the “vox populi” is heard and fully articulated through legislation.

But I would like to believe that despite conflicting views, despite diverse concerns, when votes are taken, it is the common interest of provinces, our cities, our municipalities, our barangays or, in the case of congress, our nation, that will ultimately prevail.

That whatever individual, district, local or national interests are brought into the legislative arena, let us always bear in mind that we are all working towards one goal: the betterment of our people and our nation. This is nation building at work!

Let me now proceed to the second part of my keynote:

II. Initiatives as Chair of the Senate Committee on Local Government

For the sake of brevity, let me enumerate the specific bills that the Senate Committee on Local Government under my chairmanship has initiated and/or have been deliberating on these past three years with respect to the pertinent provisions of the 1991 Local Government Code that have been found to be needing of amendments. This is not to mention all the bills related to the creation of barangays, municipalities, cities, and provinces, foremost of which was the proposed creation of Nueva Camarines to be carved out of the existing province of Camarines Sur. Some of these local bills have been passed into law, while the committee work on the others were unfortunately delayed due to the six months impeachment process that took a significant toll on our time and the available manpower resources in the Senate. Let me briefly go over the pertinent bills:

A. Bills still pending in the committee
1. SB 3296 - the proposed measure which your humble representation authored seeks to change the term of Barangay and Sangguniang Kabataan officials from three (3) years to five (5) years. The rationale for this is to give the Barangay and Sangguniang Kabataan officials a longer period of time to pursue their plans and programs of development. All local executives are unanimous in admitting that three years is just too short.
2. SB 1101 - another bill that has been deliberated upon by the committee is the one authored by Senator Manny Villar which aims to cure the defects in the present system where 40% share of the gross collection from national taxes of the government are not fully remitted to local government units concerned. It is the intention of this bill to ensure that each local government unit shall receive its just share from national wealth taxes. Justice and fairness dictates this!
3. SB 2987 - as authored by Sen. Koko Pimentel and referred to the Committee on Local Government, this bill seeks to increase the IRA share of local government units from 40% of the national revenue taxes to 50%. This is very much consistent with the promotion and enhancement of local autonomy. And if effectively implemented this will translate into more dynamic and productive local government units that will lead to the intensified socio-economic development of their respective localities.

B. Bill approved on third reading in the Senate prior to the recess in February 2013
1. SB 2929 – another bill which was authored by this committee chair proposes to amend Section 61 of RA 7160 or the Local Government Code of 1991. In essence, it provides that the complaint against any elective official of a component city of municipality should be filed before the Sangguniang Panlalawigan and not before the Office of the President. This is more consistent with the spirit and intent of the Local Government Code.
C. Finally, House Bill 6567 – this bill authored by Representative Danny Suarez of Quezon province and sponsored by our Senate committee is now on second reading, pending in the senate plenary’s period of interpellation. A long-delayed but very important piece of legislation, this bill proposes that all elective barangay officials shall be granted a retirement compensation equivalent to one-year pay, but which shall not exceed P100, 000.00 per official. The covered retiring barangay officials should be at least 60 years of age with a minimum of nine years in service at the time of retirement. This bill seeks to recognize the present inequitable situation where barangay officials are not adequately compensated by the government. It is the purpose of this bill to fill that long acknowledged inadequacy, based on the principle of just compensation.

Ladies and gentlemen, colleagues and friends, I hope that I have covered enough ground on the subject before us - as I have often told my colleagues in the Upper House, these past three years of my chairmanship of the Senate Committee on Local Government, has not only provided me the opportunity to put into important legislation, the experience and lessons I learned on the ground as a provincial executive, but more importantly, it gave me the chance to articulate into different pieces of legislative bills the various views, constructive suggestions and significant proposals from all sectors and from different LGUs that pointed to the urgent need to amend certain provisions of the Local Government Code in order to make it more relevant and responsive, as well as in tune with the exigencies and demands of the ever-increasing development requirements of the various levels of local governance. If indeed these proposed amendments will see eventual passage in Congress, there is no doubt that decentralization and the granting of local autonomy in its most effective form and substance will certainly contribute to the greater socio-economic development of our nation and further the much-needed political maturity and productivity of our people!

On this note, let me thank you all again for having invited me to speak before you today and allow me to wish you the best as you proceed with rest of your conference agenda.

Maraming salamat at mabuhay to all of you!