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MANILA, Philippines - The government must release the list of the best- and worst-performing local government units (LGUs) each year in order to encourage reforms in fiscal administration and service delivery by local governments, as envisioned by the Local Government Code (LGC).
The recommendation is included in the first Annual PIPER Policy Forum, with the theme “Fiscal Decentralization after 20 Years: What have we got to show? What have we learned? Where do we go from here?” held Monday at the Ortigas Center.
In the proposal, the performance of each LGU will be gauged on the basis of data submitted to the Commission on Audit (COA) and the National Statistical Coordination Board (NSCB). A set of criteria crafted by a panel of experts, or groups like the Philippine Institute for Development Studies (PIDS) or a state corporation like the Philippine Center for Economic Development (PCED) can be used for the evaluation.
Explaining the rationale for such an assessment, economics professor Ben Diokno said, "What is lacking is the system of accountability and so we need to improve the information. The theory says that if elections are working perfectly, then bad local authorities will be booted out of office. But we all know that's not true.”
He expressed hope that with a system of performance evaluation, published annually based on fiscal data collected by the COA, for instance, and then the socioeconomic data to be collected by the NSCB, “you can put them together, you come up with an evaluation of how good or how bad a manager local authorities are and then just have it published."
GIZ Decentralization Program Program Manager Herwig Mayer said this system can take its cue from Germany's Government Performance Management System (GPMS), a self-assessment system used to gauge local government performance.
The results of this system in the past were translated into how citizens voted. With the results published annually, the system was able to influence votes.
Based on the previous results, Mayer said around 7 of the top 10 local authorities and only 4 out of the bottom 10 were re-elected to the current posts.
Diokno and other experts think a system of performance evaluation similar to the GPMS could do the trick for the Philippines. While a system of self-assessment worked in Germany, this will not work in the country since all LGUs, including those who are not doing their jobs well, will be able to score high given a set of criteria.
"I have a feeling that they have it right now but they don't want to publish it. They have a system of self-evaluation, but you know what's wrong with self-assessment, everybody gets good grades. So you have to assign this to a government think tank the PIDS or the Philippine Center for Economic Development and just like the World Bank, publish it every year," Diokno said.
After 20 years, decentralization as envisioned by the Code may have amounted to nothing unless a serious means for assessing the LGU’s performance is in place, Diokno said.
One of the biggest problem areas in the Code, said Diokno, is the formula for computing the Internal Revenue Allotment (IRA), particularly the assumption that all local governments have equal needs.
The result is a lopsided distribution of the IRA, a situation that Synergeia Foundation Chief Executive Office (CEO) Milwida Guevara said accounts for heart-wrenching gaps in the conditions of children, for instance: children in Makati City have access to raincoats and shoes but children in Mindanao barely have access to basic school supplies like pencils.
According to Guevara, this is cited as one of the possible reasons for LGUs to aspire to become cities, the wisdom being that if they do that, they have access to more resources because there is a smaller number of cities compared to municipalities, and they end up with a bigger IRA to address the needs of their constituents.
This formula, according to Diokno, has made most LGUs dependent on the IRA and not so hard-pressed to raise their own taxes.
In many LGUs, the IRA accounts for at least 75 percent of their revenues and this trend of IRA dependence is rising, he said. Besides the IRA, the devolved functions of national government agencies have also not been implemented efficiently.
The Code mandates that devolved government agencies such as the Department of Health (DOH) and the Department of Social Welfare and Development (DSWD) must see their budgets and manpower cut every year since 1991, when the Code was enacted. The budgets and manpower of these two agencies have been increasing, though.
Diokno said the DOH budget between 1987 to 1991 comprised 5.21 percent of the national budget but after 20 years, the budget barely moved and in 2011 was around 2.38 percent of the Government Appropriation Act (GAA).
In terms of manpower, the number of DOH personnel even rose, albeit slightly, by 0.4 percent to 29,106 permanent personnel from the devolved permanent personnel of 29,000. The DSWD budget rose to the equivalent of 2.46 percent of the GAA in 2011, from only 0.58 percent in the 1987-1991 period. The agency’s manpower shrank by only 1.1 percent, or 2,758 employees from the devolved number of 2,788 employees.
