Understanding Federalism 2 – The Philippine Experience under the Local Government Code and its Lessons for a Philippine-style federalism

Elpidio V. Peria
9 October 2016


Federalism Discussion Series 2, 2 October 2016  @ Passionist Lay Center, Novitiate Compound, General Santos City (photo: EV Peria)

BITS Policy Center in collaboration with the Passionist Center for Justice, Peace and Integrity of Creation (PC-JPIC) held last 2 October 2016 the second part of its series of planned discussions on federalism and this time, the topic was about the experiences of the country under the Local Government Code which started with a powerpoint presentation where various studies by scholars including the Asian Development Bank as well as the Pnoy Administration Cabinet Cluster on Good Governance and Anticorruption 2013-2015 were presented.

The gist of the presentation is that what is needed by the local government units are one, greater power to generate its own sources of revenue, including taxes and greater share in the national wealth and two, increased capacity to perform and deliver the basic services to its constituents in accordance with its existing powers.

There were exchanges on this and one view is that the issue of capacity will not be a difficult one as these people can be easily hired but the point on the issue of capacity is that it takes time to build the knowledge and know-how of the people in the local government unit who will stay and perform the functions of the position.

Later it was suggested that perhaps these two items, greater power to generate sources of revenue and greater capacity to perform and deliver on its basic functions may be the things that will be needed to be provided by the federalism model that will eventually be presented by the Duterte Administration.

A point was also raised whether federalism can really deliver these two necessities in local governance or perhaps an amendment of the Local Government Code may also put these two necessities into reality.

It was then realized that these two items need time to really happen and thus, there must be a transition period, a really sufficient one, no time frame was agreed, but the example of President Gloria Macapagal-Arroyo’s federalism model in 2005 was mentioned, it was ten years.

One discussant said that what we need to be watchful of are the potential entry of foreigners in the natural resources and telecommunications sector, which are reserved by the Constitution to Filipinos.

In response to this, it was noted that these resources are the resources that will be relied upon by local government units who may not have enough means and thus the entry of foreigners may eventually be allowed to enable these local government units provide for its needs.

Pursuing further how poor local government units may be grouped together under a federal set-up, this matter of who gets the resources and where will it come from will become a thorny issue in the case of well-off local government units who may be grouped with local government units that are not self-sufficient. The constituents of the well-off local government units will have to ponder whether they will be willing to subsidize the poor local government units.

Among other things that are also important that must happen during the transition period are some political reforms that will, among others : prohibit turn-coatism, the practice by politicians of switching political parties, especially to those parties that have won a recent election, and strengthen the political campaign finance system so that political parties will develop in a manner where they are not dependent on vested interests for their support and operations and they will therefore be funded out of taxpayer money.

These reforms are important especially when the shift to a federal set-up will also include a shift to a parliamentary system of government.

When asked whether the existing party-list of the 1987 Constitution would help us develop a strong party-based political system, which is a must if we are to shift to a parliamentary system, the overwhelming view was towards the negative side since even the party-list system has been corrupted by the powers-that-be, including the political dynasties, what with the proliferation of party-lists that are organized by political families or even regional ethnic groups and these are the ones who are the least marginalized, contrary to the rationale of the party-list system, to empower marginalized groups so they may develop into a positive and active player in the country’s political system.

It was also asked of the participants if the people right now in general have a clear idea of what the role of the government and individual should be, as that kind of framing will identify whether the individual may have progressive or conservative tendencies, which is the cornerstone of strong political parties in Europe or in North America. The answer is in the negative, thus making it difficult to even establish what a political party’s role should be.

From these exchanges, it was seen that it is important to have a long transition period before the shift to a federal system will happen since that period will enable the local government units amass enough resources from its exercise of its own powers of revenue generation so that it will not be dependent upon the more well-off local government units inside a federal set-up and also enable the people running the local government unit get enough capacity so that the local government unit would be able to perform and deliver its basic functions. In addition, political reforms need to be put in place such that a strong party system will emerge that will eventually be the institutional vehicle to carry the aspirations of the people in a federal system, without any interference from the political dynasties.

If the shift to a federal system will be sudden, without this preparation, then what will happen is what the advent of the Local Government Code in 1991 resulted into, when key services of the national government like health and agriculture were devolved so suddenly and the local government units were unprepared to deal with the challenges of delivering the necessary services these functions were for a while given back to the national government and the resulting confusion, demoralization in the bureaucracy and the frustration of the ordinary people expecting to receive basic services but were not able to, held back the advances towards achieving a better quality of life to the people in the lowest level of the local government units particularly the barangays.

In spite of the awareness of these potential problems of a sudden shift to federalism without an adequate transition period, the participants agreed it is important the people be given a choice now, unlike before in earlier periods of our history from the time of the hand-over of the Spaniards to the Americans, the decision to vote for the 1935 Constitution and the 1973 Marcos Martial Law Constitution, to choose whether they want a federal system or not. It was also realized that there will actually be two decisions that will be made in any referendum on federalism : one, on the organizational form of government from unitary to federal and the type of government, from presidential to parliamentary, the people should also be capacitated so they will learn to express their political will through political parties of their choice.


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