Manila Standard Today - A local government champion in the Senate

24 September 2011

By Alvin Capino | Manila Standard Today

Manila-Standard-Alvin_CapinoOf all the sitting senators Sen. Ferdinand “Bongbong” Marcos is the natural champion of Local Government Unites simply because he intimately knows how things are in the provinces, cities and municipalities.

Marcos has served as vice-governor and three-term governor of Ilocos Norte, so he knows the sentiments and the situation of LGUs

Local government units are facing a fiscal crisis because of the expected reduction by 4.8 percent in their Internal Revenue Allotment. This is a cause for concern for LGUs who have to make to do with a smaller budget despite the fact that their expenses are rising.

The expected cut in LGUs’ revenue allotment is due to a provision in the Local Government Code that sets a particular fiscal year’s era based on actual revenue earnings on the third preceding year. LGUs are now expecting to get a lower IRA share for the next two years because of lower tax collections in 2009 and 2010,

As a result of this formula, the IRA outlay for LGUs is expected to be reduced by 4.8 percent even if there’s a 20-percent increase in the Malacañang-proposed budget for 2012.

This reduction is substantial. In terms of actual figures, the 4.8-percent reduction is equivalent to P13.3 billion.

Marcos, as a former governor, the impact of such a reduction. He is now calling on Malacañang to find innovative ways to make up for the IRA reduction so as not to adversely affect the LGUs’ delivery of basic services in their respective localities and help them energize their local economies.

Marcos believes that if Malacañang really wants to help LGUs, and if its rhetoric on local autonomy and devolution is more than just talk, it can find money to restore the planned reduction through innovative solutions like subsidies.

He says for one, Malacañang could source the P13.3 billion needed from the national-government savings, which, according to the weekly “good news” newsletter of the Presidential Communications Operations Group, hit P26.25 billion last April alone—almost double the needed cash to restore the proposed budget cut.

In a recent hearing on the proposed 2012 budget of the Department of Interior and Local Government, Marcos told Department of the Interior and Local Government Secretary Jesse Robredo that the national government should first try to restore the IRA cut, possibly from its savings, as it seeks a 20-percent hike in its proposed 2012 national budget.

Robredo said that in a meeting of President Aquino and Budget Secretary Florencio Abad with governors, the Chief Executive said that the budget deficiency of LGUs could be augmented by budgetary assistance in the form of project grants and merit-based aid.

Marcos, however, stressed: “It is necessary that we restore at least a large part of that P13.3 billion. I cannot see how we can consider that performance and merit alone can form a replacement for the 4.8-percent reduction” pointing out that IRA cut will affect 80 provinces, 128 cities, 1,496 municipalities and 42,000 barangays.

He said that with 55-percent of the budget of the LGU going to personal expenditures, another 10 percent to maintenance and other operating expenses and 20 percent more to development funds, the IRA cutback will mean there will be little left for them to do anything.