local good governance by ramon t. ayco

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Local Good GovernanceBy Ramon T. Ayco

September 2007

I. Introduction

A. What is governance?

The concept of “governance” is not new. It is as old as human civilization. Simply put “governance” means: the process of decision-making and the process by which decisions are implemented (or not implemented). Decisions on what? Decisions on the exercise of administrative authority to manage a nation’s affairs on politics, economics, culture and all other aspects of social life.

Since governance is the process of decision-making and the process by which decisions are implemented, an analysis of governance focuses on the formal and informal actors involved in decision-making and implementing the decisions made and the formal and informal structures that have been set in place to arrive at and implement the decision.

Government is not equal to governance.

Government is only one of the actors in governance, but the principal or major actor. Other actors involved in governance vary depending on the level of government that is under discussion. In rural areas, for example, other actors may include infl uential landlords, associations of peasant farmers, cooperatives, NGOs, research institutes, religious leaders, fi nance institutions political parties, the military etc. The situation in urban areas is much more complex. Diagram1 provides the interconnections between actors involved in urban governance. At the national level, in addition to the above actors, media, lobbyists, international donors, multi-national corporations, etc. may play a role in decision-making or in infl uencing the decision-making process.

All actors other than government and the military may be grouped together as part of what we call the “civil society.” In some countries in addition to the civil society, organized crime syndicates also infl uence decision-making, particularly in urban areas and at the national level.

Similarly formal government structures are one means by which decisions are arrived at and implemented. At the national level, informal decision-making structures, such as “kitchen cabinets” or informal advisors may exist. In urban areas, organized crime syndicates such as the “land Mafi a” may infl uence decision-making. In some rural areas locally powerful families may make or infl uence decision-making. Such, informal decision-making is often the result of corrupt practices or leads to corrupt practices.

B. Forms of government

In analyzing the history of humanity, one aspect becomes clear: humanity must be governed. The natural question is, by whom and how?

Government can be gauged by two extremes. On the one side is a highly centralized government where one person or a very small group hold absolute power and controls the whole population and every aspect of people’s life. On the other side is anarchy. There is no government; every individual fends for his or herself. The most common classifi cation of government according to the number of people who hold political power are:

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Diagram 1: Urban actors

• autocracies where one individual holds all the power. This category includes absolute monarchies, as well as dictatorships.

• oligarchies where political power is held by a small group of people who share the same interests.

• democracies are governments where the people as a whole, hold the power. It may be exercised by them (direct democracy), or through representatives chosen by them (representative democracy).

• anarchy is a lack of government or imposed rule.

History has shown that anarchy, if ever established, has a very short life; a strong dictator usually destroys it. Ironically, that is the sign of an inferior government, it is

usually replaced by a strongman who rules the country until either a democracy is formed or another strongman replaces the original. As the gauge goes from anarchy to dictatorship, personal freedom of the individual becomes more and more limited. When the governments demands for the people increase and freedom diminishes, the more further the governments goes to dictatorship.

C. Centralized Government

A centralized government is a form of government in which power is concentrated in a central authority to which local governments are subject. Centralization occurs both geographically and politically.

A centralized government is characterized in which the local governments are designated by the central Government of the country,


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like the local administrative authorities. In this type of government, there are not existing local congresses.

Nearly any government can be said to centralize their power to a degree. The term is applied to governments that vest limited authority to its subjects and often used in comparative terms, such as “highly centralized government” or “weakly centralized government”.

Actually, the majority of governments in the world are centralized, be it a top-heavy government or a dictatorship. The citizens of a centralized democracy elect their politicians and then have little involvement until the next election cycle. Too much centralization means dictatorship, and in a dictatorial government all the rights of the people perceived to be harmful to the leader or leadership are curtailed.

History shows that the more centralized a government is, the less freedom the people have. The less freedom the people have, the more a government is vulnerable to corruption. Even if a dictatorship started in a very “noble objective”, it always end up in corruption perpetrated by the leader himself or by the people around him or her.

Leaders and their regimes very rarely call themselves “dictator(ship)”, and usually do not consider themselves to be oppressive, or simply do not admit it. Most often, dictators portray themselves as benevolent and savior, an absolute ruler who exercises his or her political power for the benefi t of the people rather than exclusively for his or her own benefi t.

Hitler is a classic example of a dictator. He rose to power with a slogan “freedom and bread” and promises order, prosperity, and community to the German people. But his dictatorship ended up in rampant corruption and holocaust that kills thousands of people.

In the Philippines, Marcos presented himself as the individual who could break a long pattern of corruption and inadequate leadership. He used such slogans as “Rice and Roads” and “This Nation Can Be Great Again!’ to rise in power. He imposed martial law and claimed that it was the prelude to the creation of a “new society”. But Marcos, his wife, and their closest associates practiced corruption with impunity. They plundered the Philippine economy through their system of “crony capitalism,” in which they controlled monopolies in industry, communications, and banking.

When Marcos and his family left the Philippines, they took with them some 300 crates of prized possessions and more than 28 million cash, in Philippine currency. In 1995, the Philippine government was able to auction off three jewelry collections of Imelda Marcos worth $13 million. In 2003, the Philippine government was awarded $650 million from frozen banks accounts in Switzerland that had belonged to Ferdinand Marcos.

D. Corruption and poverty

In the recent past, many political establishments have been caught in scams and scandals, with leaders amassing wealth, resources and power. The magnitude of the systematic fraud, deceit, chicanery, embezzlement and theft is shocking. This appropriation of public funds directly affects the whole society most especially the poor people.

Corruption is a symptom of something gone wrong in governance. Institutions designed to govern the relationships between citizens and government are used instead for the personal enrichment of public offi cials and the provision of benefi ts to the corrupt.

All forms of government are susceptible to corruption, or political corruption to be exact.

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While corruption may facilitate criminal enterprise such as drug traffi cking and money laundering, it is not restricted to these organized crime activities. In some nations corruption is so common that it is expected when ordinary businesses or citizens interact with government offi cials. The end-point of political corruption is a kleptocracy, literally “rule by thieves”. Forms of corruption vary, but include the following:

• Bribery

Bribery requires two participants: one to give the bribe, and one to take it. In some countries the culture of corruption extends to every aspect of public life, making it extremely difficult for individuals to stay in business without resorting to bribes. Bribes may be demanded in order for an official to do something he is already paid to do. They may also be demanded in order to bypass laws and regulations.

• Graft

While bribery includes an intent to infl uence or be infl uenced by another for personal gain, which is often diffi cult to prove, graft only requires that the offi cial gains something of value, not part of his offi cial pay, when doing his work. Large “gifts” qualify as graft, and most countries have laws against it. (For example, any gift over $200 value made to the President of the United States is considered to be a gift to the Offi ce of the Presidency and not to the President himself. The outgoing President must buy it if he wants to take it with him.) Another example of graft is a politician using his knowledge of zoning to purchase land which he knows is planned for development, before this is publicly known, and then selling it at a signifi cant profi t. This is comparable to insider trading in business.

• Extortion and robbery

While bribes may be demanded in order to do something, payment may also be demanded by corrupt offi cials who otherwise threaten to make illegitimate use of state force in order to infl ict harm. This is similar to extortion by organized crime groups. Illegitimate use of state force can also be used for outright armed robbery. This mostly occurs in unstable states with lacking control of the military and the police. Less open forms of corruption is preferred in more stable states.

• Patronage

Patronage refers to favoring supporters, for example with government employment. This may be legitimate, as when a newly elected government changes the top offi cials in the administration in order to effectively implement its policy. It can be seen as corruption if this means that incompetent persons, as a payment for supporting the regime, are selected before more able ones. In non democracies many government offi cials are often selected for loyalty rather than ability. They may be almost exclusively selected from a particular group (for example, Sunni Arabs in Saddam Hussein’s Iraq, the nomenklatura in the Soviet Union, or the Junkers in Imperial Germany) that support the regime in return for such favors.

• Nepotism and Cronyism

Favoring relatives (nepotism) or personal friends (cronyism). This may be combined with bribery, for example demanding that a business should employ a relative of an offi cial controlling regulations affecting the business.

• Embezzlement

Embesslement is outright theft of entrusted funds. It is a misappropriation of property.


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• Kickbacks

A kickback is an offi cial’s share of misappropriated funds allocated from his or her organization to an organization involved in corrupt bidding. For example, suppose that a politician is in charge of choosing how to spend some public funds. He can give a contract to a company that isn’t the best bidder, or allocate more than they deserve. In this case, the company benefi ts, and in exchange for betraying the public, the offi cial receives a kickback payment, which is a portion of the sum the company received. This sum itself may be all or a portion of the difference between the actual (infl ated) payment to the company and the (lower) market-based price that would have been paid had the bidding been competitive. Kickbacks are not limited to government offi cials; any situation in which people are entrusted to spend funds that do not belong to them is susceptible to this kind of corruption.

What constitutes illegal corruption differs depending on the country or jurisdiction. Certain political funding practices that are legal in one place may be illegal in another. In some countries, government offi cials have broad or not well defi ned powers, and the line between what is legal and illegal can be diffi cult to draw.

A country is poorer overall when corruption levels are high. A state with endemic corruption can be especially brutal to the very poor, who have no resources to compete with those willing to pay bribes.

• The poor will receive a lower level of social services. Anytime public benefi ts are distributed on the basis of ability to pay, the poor will suffer. Using an illegal price system to distribute pensions, public housing, education and health will disadvantage those unable to pay. This is true for legal user fees, and

it is true for illegal bribes. But the point remains.

• Infrastructure investment will be biased against projects that aid the poor. In a state where corruption is pervasive, offi cials will design public projects to maximize bribery receipts and to minimize the chance of detection. This strategy favors projects that are excessively large and complex. Furthermore, projects may be poorly targeted towards the poor, since such a goal does not increase corrupt receipts. Taxes and foreign aid loans and grants will cover the cost of these projects instead of being used for projects that benefi t the worst off. Even projects such as the building of schools or health clinics will provide fewer benefi ts to the poor if their costs are infl ated by payoffs.

• The poor will face higher tax burdens or fewer services. If corruption pervades the collection of taxes and customs duties, the proportion of the total tax bill imposed on those without the power and wealth to pay off tax collectors will increase. Of course, the very poor are unlikely to be a promising source of revenue, but they will face increased pressure to contribute. One consequence may be a decision to move into the informal, underground economy where tax collectors cannot fi nd them. Alternatively, if the poor are unable to pay taxes, the result of corrupt deals will be a shrunken state unable to provide many services.

• The poor are disadvantaged in selling their agricultural produce. Many of the poor are small-scale agricultural producers. They depend


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on middlemen to get their products to market. If these people have induced the state to grant them local monopolies over particular geographical areas, farmers become disadvantaged. Corrupt offi cials have an incentive to create such monopolies and use them to extract personal gains. Agricultural marketing boards have frequently operated in this fashion and are familiar sources of patronage and corrupt payoffs for rulers.

• The growth of indigenous, small-scale enterprises is limited. In some countries many poor people are concentrated in cities and live off of small-scale business enterprises. Their ability to escape poverty using these enterprises may be severely restricted by the corruption of the state regulatory and taxing apparatus. Such corruption keeps them off the books and limits their ability to grow.

A bribe may determine who obtains a government contract or a privatized fi rm, where the basic terms have been set without regard for the possibility of corruption. Then the bribe represents a transfer from the profi ts of the winner and the government treasury to the pockets of the offi cial. Unless the bribe comes entirely from the winner’s profi ts, the state suffers a revenue shortfall, but this is of no special concern to the poor segment of the population.

In other cases bribes are collected by political parties and candidates, and used to purchase the votes of the poor. Although hardly a recipe for effective and legitimate government, such payoffs do represent a redistributive transfer. The overall impact of such a method of campaign fi nance could, however, be harmful to voters if elected politicians then favor ineffi cient projects appealing to major donors. The poor may

suffer as a group, but still have an incentive as individuals to accept the payoffs.

E. Good Governance

Governance and good governance have become the theme of discussions, deliberations and discourse everywhere in the world today. Good governance, people centered governance, responsive governance all call for collective sense of destiny and direction for human beings. Crisis in governance witnessed all over the globe has called for re-examination of broader tenets of governance. Bad governance does not only affect the day to day delivery of goods and services to the citizens of a country. It fundamentally alters the principles of politics for the good of all.

In a democratic polity one way of measuring the governability of a government is to judge a government’s performance on issues that the government itself defi nes as areas of priority. This is all the more true of democratic governments than military regimes because democratic form of government is supposed to be ‘rule of the people’. With the swift changes that are taking place at the local, national and international levels governance would be tested by ethnic clashes, demand for separate identity, nation within nation, federal vs. unitary forms of governments, development vs. sustainable development etc.1

The ability to deal with dissent and protest, which is part of identity politics as well as generated by civil society is another that poses challenge to good governance. Within a democratic political system dissent is provided space and the causes of dissent are addressed to in a long-term solution manner than just crisis management. On the other hand, the absence of open violence, especially in non-democratic settings, does not necessarily indicate a government that governs well, but an increase in politically oriented violence in a more or less open polity nearly always indicates a growing crisis of governability. It indicates that the state does not possess the institutions necessary


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for peaceful resolution of the society’s normal political confl ict.

A developing country, which is democratic in its polity, is well governed if its government can simultaneously sustain legitimacy, promote socio-economic order and maintain order without coercion. In sum, good governance refers to non-partisan and active legislative bodies, independent judiciary, free print and electronic media, constitutionally guaranteed system of decentralization and devolution of power to all levels of governance, direct democratic accountability at the local levels, and a vibrant and vigilant civil society. In good governance the common masses are the central focus of all development, their political participation is ensured.

One way of measuring good governance is to set up standards whereby some objective defi nition of a society’s problems would be sought and against which the capacity of a government to solve problems would be assessed. By that, we can measure good governance by a set of eight (8) major characteristics: participatory, consensus oriented, accountable, transparent, responsive, effective and effi cient, equitable and inclusive and follows the rule of law. Good governance is a subset of governance wherein public resources and problems are managed effi ciently. It assures that corruption is minimized, the views of minorities are taken into account and that the voices of the most vulnerable in society are heard in decision-making. It is also responsive to the present and future needs of society.

1. Participation

Participation by both men and women is a key cornerstone of good governance. Participation could be either direct or through legitimate intermediate institutions or representatives. It is important to point out that representative democracy does not necessarily mean that the concerns of the most vulnerable in society would be taken

into consideration in decision making. Participation needs to be informed and organized. This means freedom of association and expression on the one hand and an organized civil society on the other hand.

2. Rule of law

Good governance requires fair legal frameworks that are enforced impartially. It also requires full protection of human rights, particularly those of minorities. Impartial enforcement of laws requires an independent judiciary and an impartial and incorruptible police force.

3. Transparency

Transparency means that decisions taken and their enforcement are done in a manner that follows rules and regulations. It also means that information is freely available and directly accessible to those who will be affected by such decisions

5. Consensus oriented

There are several actors and as many view points in a given society. Good governance requires mediation of the different interests in society to reach a broad consensus in society on what is in the best interest of the whole community and how this can be achieved. It also requires a broad and long-term perspective on what is needed for sustainable human development and how to achieve the goals of such development. This can only result from an understanding of the historical, cultural and social contexts of a given society or community.


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6. Equity and inclusiveness

A society’s well being depends on ensuring that all its members feel that they have a stake in it and do not feel excluded from the mainstream of society. This requires all groups, and especially the most vulnerable to have opportunities to maintain or improve their well being.

7. Effectiveness and effi ciency

Good governance means that processes and institutions produce results that meet the needs of society while making the best use of resources at their disposal. The concept of effi ciency in the context of good governance also covers the sustainable use of natural resources and the protection of the environment.

8. Accountability

Accountability is a key requirement of good governance.

It covers the spectrum of approaches and practices used by governments to ensure that activities and output meet intended goals and standards. While realization of the government’s goals and objectives is a subject of complex and long-standing debate, fi nancial accountability presents an urgent challenge that requires an immediate and practical solution.

Not only governmental institutions but also the private sector and civil society organizations must be accountable to the public and to their institutional stakeholders. Who is accountable to whom varies depending on whether decisions or actions taken are internal or external to an organization or institution. In general an organization or an institution is accountable to those who will be affected by its decisions or actions. Accountability cannot be enforced without transparency and the rule of law.and their enforcement.

Diagram 2: Characteristics of good governance


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It also means that enough information is provided and that it is provided in easily understandable forms and media.

4. Responsiveness

Good governance requires that institutions and processes try to serve all stakeholders within a reasonable timeframe.

Good governance defi nes an ideal which is diffi cult to achieve in its totality. Very few countries and societies have come close to achieving good governance in its totality. However, to ensure sustainable human development, actions must be taken to work towards this ideal with the aim of making it a reality. Good governance is ensuring a better today and a brighter future for all the citizens.

II. Decentralization

First of all, before we can established a local good governance, local governments must fi rst have real power. As we have said above, the majority of governments in the world are centralized. In order for local governments to have real power we have to go on a process of decentralization.

A. Meaning of Decentralization

In response to the many failings of centralized government, decentralization has become a world-wide trend. Towns and other local governments in rural areas are being strengthened in a growing number of countries in all continents.

Decentralization refers to the process of moving towards decentralized governance—in which economic, political and administrative power, authority and resources are transferred from the centre to lower levels of

governance—”the processes and institutions through which citizens and groups exercise their legal rights, meet their obligations and mediate their differences”.

Decentralization does not only mean the dispersion of functions or the delegation of power from center to local, which means the functional division between center and fi eld offi ce within the central government. More than that, decentralization is the devolution of power, the shift of authority from central government to local government, which goes with the reallocation of tax resources between central and local government usually.

In this sense, the decentralization requires the reform of central-local government relationship and the autonomy of local government. As the local government and local community achieve their autonomy and self-help, they can activate local resources successfully in order to pursuit the economic development of region or locality.

As each country has its own local government system, the decentralization reform in practice is various. For instance, decentralization has different meanings between the countries which have only municipal levels of local government and those with regional and local levels of local government. The French decentralization reform in 1980s has been characterized in the regional and department level reform. In French case, the focus of decentralization was on the devolution and liberalization of department. It was the same in Japanese decentralization.

The characteristics of decentralization are much different whether the level of decentralized local government is municipal or regional. Also, there are many differences whether the local government system is a single-layer or multi-layer. In the multi-layer system, we have to take account of the


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regional-municipal government relationship and the decentralization from regional to municipal.

In any case, the municipal or community level decentralization is likely to empower the municipal level government. In general, the municipal government is the most near to local people. This means that the municipal government has a key role as a base of local governance and its empowerment is critical to the local people who participate in the local governance.

In the case of regional level decentralization, the reconstruction and liberalization are implemented, because the regional level government has been an agency of central government or under the strict control of central government. The decentralization and empowerment of regional government are usually to achieve the regional economic development and the capacity building to support and assist the municipality.

Vertical and horizontal decentralization for effective local governance2

For effective local governance, decentralization policies, strategies, legal frameworks, programs and activities must be conceived from two planes:

• The vertical plane, involving the transfer of authority, functions, responsibilities and resources from central government to local government structures; and

• The horizontal plane, involving the empowerment of grass-root munities to enable them to determine, plan, manage and implement their socio-politico-economic development.

While vertical decentralization requires shifts in central government policy, laws as well as institutional and structural arrangements to provide for the sharing of powers, authority,

functions and resources, thus enabling local governments to perform fully, horizontal decentralization may take place without necessarily making adjustments in the laws. However, horizontal decentralization requires determined mobilization and organization of local communities to participate fully in the planning and implementation of socio-economic activities that are aimed at strengthening their capacities to determine and enjoy their socio-economic livelihood.

An important linkage between vertical and horizontal decentralization is that in countries used to highly centralized governments and/or dictatorships, horizontal decentralization empowers local populations and prepares them to be able to positively receive and utilize the powers, authority, and resources transferred to them via vertical decentralization. It is very useful to always engineer efforts of decentralization on the two planes involving all stakeholders. As illustrated in the diagram below, this will achieve two crucial results:

• horizontal decentralization will empower local communities; and

• vertical decentralization will create conducive structural arrangements and transfer of powers, functions, responsibilities and resources that will supplement the empowerment created by vertical decentralization.

Conceiving the two planes of decentralization is also useful in situations where the debate and agreement on formal vertical decentralization involving the transfer of powers, authority, functions, and resources from central government to local governments for various reasons takes longer than needed. In such cases, it is possible and advisable to start establishing programmes, projects and activities that empower local communities via, for example, community-based organizations


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(CBOs) and non-governmental organizations (NGOs). This is what happened in Rwanda (in Africa) before the current policy of decentralization.

B. Why Decentralization?

In many countries with centralized systems, the pursuit of good governance has neglected the local level of government. Despite numerous reforms and spent resources, many central governments have failed to provide local services with the quality and consistency required to signifi cantly improve the standard of living of the majority of the population. This failure is often not so much due to a lack of money as it is to the ineffi cient use of available resources and the inherent diffi culties posed by governing from a geographic and psychological distance from most of the citizens.

From the perspective of ordinary citizens, the central is often too far away from the experiences of their life to meet the needs and problems the citizen faces every day.

Instead, it is the local level of government that really matters for individuals and their families. They send their children to state-run schools in their village or town, use public roads and transportation, register important family events such as birth and death with the authorities, and get water and often electricity from the municipality.

The geographic distance of central governments very often leads to a lack of information about local needs and local problems. Even if the individual government employee within the central government is interested in helping the local level, he or she generally lacks information about the specifi c requirements of the community needing assistance.

Offi cials who work for centralized governments do not have the necessary knowledge of local conditions to provide effi cient government services because this knowledge is dispersed among the millions of people who comprise society, and cannot be transmitted to a central planning board. Even the best organized central administration


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is unable to really determine whether, in a specifi c rural village, expanding the school or improving irrigation is more important at a particular moment. Only local authorities can make such determinations.

The psychological distance of central government offi cials from the people they govern is another reason for the failure of central governments to provide services at the local level. Too often, the central government’s activities at the local level are not driven by demand from the local citizens, but rather are imposed on them by agencies that have developed ideologies within the context of the interests of the central government. The people at the local level do not feel any ownership of the activities and may even reject the “gifts” imposed on them. Such lack of responsiveness by the population may come less from the activity itself and more from the way it is imposed.

The failure of centralized governments to perform properly at the local level affects the entire local population, including the poor, women and children. At the same time, a central government’s failures are also highly detrimental to the government in power and, even worse, to the state as such. When governments cannot solve the problem of leaking pipes or teachers absent from the local school, citizens will not trust the government to address the larger problems affecting modern nations. In this way, central governmental failure causes the basis of governance to be weakened, and the legitimacy of the whole state is undermined.

A further, more practical problem with central government failure is that often, because of the poor performance at the local level, everyone who can afford it avoids governmental services. Instead of going to the public school, public hospital, or public bank, citizens begin to look for private schools,

private hospitals, and even private security fi rms. This not only weakens the role of the state but it leaves the government with the weakest and most needy part of the population which increases the burdens on governmental services and often affects quality adversely.

From the above discussion, we can sight two important factors why we should engaged in decentralization:

The fi rst is the dysfunction of centralized The fi rst is the dysfunction of centralized The fi rstdecision making system, in which the central government cannot provide the local optimum resolution to each community in different condition. The decentralization reform focuses on the local or regional differences and tries to build the capability of problem-solving in each local government.

The second is the ineffi cient resource The second is the ineffi cient resource The secondconsumption. The centralized resource allocation system, for instance the tax resource allocation system, has failed in the effi cient and effective expenditure of central and local government. The centrally raised tax and locally consumed resource system is useful for the central government to control the local expenditure and decision making. However, that system has obscured the relationship between revenue and expenditure in the localities, and local people cannot watch and control the fi nances of their local government. While the local people tend to demand many things from local government without cost consciousness, the degree of their satisfaction with the local government activity is decreasing. As a result, there has been a failure of resource allocation.

We can also add as the third factor the the third factor the the third factormaturity of local government system and local citizenship. In each country, as we have the long traditions of local government historically, the local government and local people have had the long experience of local governance. It is natural that each locality


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has accumulated the know-how and skill of operating local governance and nourished the philosophy of local autonomy.

The factors mentioned above are promoting the decentralization reform and then affecting the reorganization of local governance. In turn, the local governance should exert every effort to achieve the characteristics of good governance as mentioned above.

One of the most signifi cant effects of the interaction of the various advantages local governments have over central governments is that the state as a whole gains legitimacy. When the citizens trust in their offi cials and are more actively involved in the betterment of their community, their relationship to the state as a whole is also improved. Thus, while the authority of the central government may be diminished by decentralization, the legitimacy of the state as a whole is enhanced. Decentralization-led changes must therefore be seen as not only a “local versus central” government phenomenon, but rather as a way to mutually benefi t both levels of government and the citizens simultaneously.

C. Conditions for successful decentralization

How can the goal of empowering local governments to act as effi cient providers of services and as agents of local development be achieved? Practical experience as well as scholarly studies indicate several conditions necessary for successful decentralization.

1. Secure existence

A fi rst necessary condition for strong local government is security of existence. Clearly, local governments cannot perform properly if their existence is in jeopardy by the ability of authorities on higher levels of government to dissolve them

easily or to change their territories (e.g., merge them with neighboring areas). Secure existence requires that members of local bodies only be dismissed for specifi c, predetermined reasons and under formal procedures that require the dismissing authority to show that the dismissed person has violated the law. Clear criteria and procedures are also needed in cases of dissolution of communes and municipalities or for the alteration of their territories.

2. Resources and autonomy

The success of decentralization efforts depends to a very large extent on the availability of suffi cient resources and the possibility of using these resources autonomously. This requires, inter alia,

• the right of local governments to collect local taxes and fees and to get funds from the central government necessary for the execution of tasks transferred to them;

• the right to spend this money without excessive prior control by higher levels of government;

• the right to take decisions on local activities including local development projects without undue interference by national planning authorities and line ministries.

• a suffi cient aqnd well-qualifi ed local staff and the right to zppoint and dismiss such staff, and

• technical support and advice from the center.


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3. Accountability and transparency

In every administrative organization it is of paramount importance to introduce a clear concept of accountability. Such accountability has two dimensions:

Making local governments and their members accountable to the people means that the citizens can elect those who rule them and have the possibility to assess their performance at the time of reelection. This requires transparency of governmental actions and the possibility to have access to relevant information such as budgets, accounts, plans, etc. Citizens must also know that offi ce-bearers who have violated the law will be punished in all cases.

Local governments are also accountable to the higher levels of government. Accountability to several authorities might create confusion and insecurity at lower levels that would be detrimental to the idea of effi cient administration. Only well-defi ned responsibilities provide for the degree of transparency and security needed by authorities at lower levels who have to make certain decisions on their own. Therefore, a high degree of transparency in the relations between local governments and the supervising authorities is necessary.

For example, local bodies must know in advance what criteria will be applied when approving decisions or denying approval. There is also a need for transparency regarding all fi nancial matters. Supervising authorities should exercise a tight control but such control should have a retrospective (ex post) character

and those who have violated the law should be punished.

4. Political will and partnership

Experience has shown that the success of decentralization efforts depends, to a large extent, on a clear vision regarding the position and function of local governments and on a strong political will to implement that vision. It also depends on the willingness of both the central and the local level to see each other as partners in an ongoing process.

Such a partnership implies a willingness by the central government and its regional representatives to exercise self-restraint in supervising local governments. Laws and directives should be framed and applied in ways that encourage initiative and that do not curtail local self- government. It also requires a readiness to consult local governments on all matters regarding them and to take their opinion into account when making decisions.

For their part, actors on the local level must be ready to assume responsibility for their activities and to take initiatives on their own to foster development, instead of waiting for the central government to act or seeking approval where not needed. Local interest groups and the local population as a whole must support the process of shifting powers and responsibilities from the center tothe local level.

Finally, structures should be created which will facilitate a dialogue between the different levels of government. In many countries,


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there have been good experiences demonstrating that associations of mayors and other heads of local governments can become reliable partners with the central government on policy questions if efforts are made to encourage local-central discussions and exchanges of ideas.

5. Strong legal framework

Another aspect of successful decentralization is the need for a strong legal framework setting out the powers, rights and duties of local governments clearly. Without such a framework, it is often impossible to know who is responsible for what. This allows central authorities to interfere easily with local affairs and leaves the local authorities with no possibility of stopping such interference..

Legal norms must, however, be adapted to local needs and to the circumstances of the local area. Norms that are imposed from somewhere else may not be used in practice or may be unsuitable and, therefore, may lose much of their impact.

III. Local Good Governance

Local governance refer to the exercise of authority at the local community level.

We need, however, to bear in mind that not every act of governance practiced at a local level would constitute local governance. It is possible to have central governance or even foreign governance at the local level. What determines whether governance is local or not is the extent to which the local population is involved [as actors of governance] in the steering, i.e., in determining the direction according to their local needs, problems, and priorities3 and the

level to which they are the benefi ciaries of the governance.

In this sense, governance ceases to be a matter of government only. It is a situation of multiple inter-linkages and relationships in which different and various actors in the public and private sectors as well as civil society at the local, national and international levels play different roles, sometimes mutually confl icting and sometimes mutually reinforcing and complementary focusing on satisfying the interests and needs of the local community.

While it may be true that “local governments act more in accordance with the needs and priorities of local communities than would higher authorities” (Jeni Klugman, 1994), local governance on its part requires that even higher authorities, in accomplishing their share of the job, work in accordance with the needs and priorities of the local community and in close partnership with them.

What, then, is local about local governance? Local governance does not make reference to local government or local populations alone. It refers to a situation where whatever a governance actor (an international NGO, a central government institution, a local government agency or a private sector enterprise) does, is planned, implemented, maintained, evaluated, and controlled with the needs, priorities, interests, participation, and well-being of the local population as the central and guiding consideration.

What is local about local governance need not be the actor but rather the needs, interests, priorities, participation, control and well-being of the local population. It is important to have this in mind. Otherwise, we will remain in the structural constraints of equating local governance to local government. For the sake of argument, we will recall that not all local governments work in the interests of the local populations. Some local governments can become dictatorial and exploit the local populations to serve the interests of local leaders.


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A. Establishing Local Good Governance

The main purpose of decentralization is not decentralization per se, but the development of local good governance. One of the most important issues in the government reform is how to establish local good governance in the decentralized system.

Of course in establishing local good governance, all the eight characteristics of good governance we mention earlier must be fulfi lled. With regards to this, among the most important reasons for us to give more authority to lower levels of government are: the greater effi ciency and accountability of local governments; the positive effect such authority-shifts have on local development; the enhancement of democracy and protection of liberty that local governance has on the citizens; and the greater ability to protect the rights and values of minority populations.

1. Effi cient and accountable administration

The desire for a more effi cient administration has motivated many of the recent constitutional and legislative changes in countries all over the world. However, experience has shown that central governments are often unable to successfully implement effi ciency-building policies and programs.

Local governments have the potential to perform better. This is based on any of several reasons, listed below. One must remember, however, that better administration is not an automatic result of decentralization. Still, if local governments are properly equipped to fulfi ll their tasks, the chances for achieving “better government” through decentralization increase.

A decentralized body “in comparison to national government, is more accessible, more sympathetic and quicker to respond to local needs”. On a local level, programs and services can be more easily adapted to particular local circumstances and needs. This is so because local authorities are obviously more knowledgeable about a local situation than are authorities who are far away from realities at the grass-root level. As a result, the necessary information to plan such programs and services is more readily available and the chances of success are consequently higher.

The close relationship between citizens and government at the local level fosters accountability. It has been pointed out that decision-making close to the people is an excellent instrument to prevent governments from abusing their powers.

This is so for at least two related reasons. First, it is more diffi cult to hide corruption among those in authority when the citizens know the offi cials than in situations where “the Government” is far away and inaccessible. Thus, persons in authority in the local government are generally less likely to have the opportunity to hide their corruption than are persons in authority in central government. Second, it is easier to hold local offi cials and elected offi ce-bearers accountable for their actions than it is to impose accountability on politicians at higher levels of government, as members of local governments are often less protected politically than the corresponding offi cial in the central government.


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Both the availability of information necessary for taking proper actions and the potentially higher degree of accountability will lead to a better use of available resources. This will allow doing more with limited resources. As one author recently stressed:

“Decentralizing spending responsibilities can bring substantial welfare gains. Government resources can be allocated most effi ciently if responsibility for each type of public expenditure is given to the level of government that most closely represents the benefi ciaries of these outlays”.

Finally, decentralization helps to reduce costs. In Nepal, for example, villagers who proudly present their self-built, small-scale projects to the foreign visitor will never fail to stress how much cheaper they were than projects carried out by government agencies. The Human Development Report 1993 has stated this same idea in more general terms:

“[If] local people feel that it is their money being spent, they are likely to keep a tighter lid on expenditures and to use resources more efficiently. ... Local development also opens up the opportunity


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Benefi ciaries who “own” a project will be more likely to assume the responsibility for the project’s maintenance. The ability to help in the early planning phases of a development project in turn also encourages the local population to carefully monitor and protect the results of the planning. Psychological self-interest mixes with fi nancial self-interest to encourage the citizens to actively promote the project’s successful implementation. In Nepal, for instance, forests are much better preserved since they have been handed over to village-based “user groups”.

3. Democracy and protection of liberty

The notion of democracy is not restricted to participation in national elections. Although the right to elect leaders of national government is certainly a part of the democratic principle, democracy also includes the ability to infl uence the decisions that directly affect a person’s life and the ability to live in freedom and liberty. Local governments are able to provide these aspects of democracy in a way that central governments often cannot.

As stated above, local level administrations can be more accessible for the average person – and thus more “human” – than a very distant and mighty central administration can be.

This gives democracy a clearly local dimension. Although a state’s respect for democracy and individual freedom does not depend on decentralization, such form of government may further these two fundamental values. The idea that local self government promotes democracy and individual liberties is deeply rooted in many

decentralized countries. The right of citizens to participate in decision-making procedures on a local level furthers true democracy.

“[Decentralization] builds a sense of community and permits more meaningful participation in self-government. In many countries, the autonomy granted to local units is designed to assure self-determination and the rights of minorities and their members against abuse by national majorities”.

This, however, implies that local entities are organized in a way allowing for real participation and that national authorities do not tolerate the creation of autocratic and authoritarian forms of government on the local level. Distribution of power to different levels of government and the competition between these levels allows for a system of checks and balances that is likely to set limits on the central government if it attempts to overstep or abuse its powers. Thus, decentralized government also constitutes a specifi c and extended expression of the basic constitutional principle of the separation of powers.

Moreover, decentralization allows, to a certain extent, for a specifi c kind of political power-sharing which in turn contributes to political stability. For example, if a government is ousted from power by a rival political party, the original government’s political party may still control some local governments.

This is compatible with the role of opposition on the national level but mitigates the harsh principle of “the winner takes all” at the local level.


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Thus, it adds to political stability. Such a stabilizing effect is shown in Nepal, where frequent changes of government at the national level during the past few years have little affected the activities of local authorities who were able to conclude their terms of offi ce without interruption. On the other hand, where the central government is very strong and even small local expenditures must be approved by the competent minister in the central government, political instability at the center directly affects the local level.

4. Protection of minorities

A further traditional argument for decentralized government is that it has the potential to protect ethnic and other traditional minorities (indigenous people).

If minorities inhabit an area with a certain degree of self- government, decentralization essentially grants them the right to be free as a collective.

Thus, decentralization offers “... the possibility of combining democratic ideals with guarantees for minorities ... (and thus) ... can provide a means of accommodating problems arising from ethnic diversity ... By guaranteeing local autonomy, especially to questions considered important to ethnic identity, the potential for confl ict within the national political arena is reduced”.

In the decentralization era, good governance is a minimum standard of local government.

In addition, decentralized local governance needs more capacity or capability, because the decentralized local government has more power and resources and has to put them

into effect effi ciently. As more democratic and effi cient localities are needed, there must be the development and reform of local government and local people. The local government’s reform by itself is diffi cult through its own effort, because of the lack of driving force in itself. Also, the development of local people’s capacity is not easy through their own effort. The interaction between local government and local people enables mutual change and reform. This is one of the most important aspects of new local governance.

Local Governance Evolved:

Operating the decentralized system, local governance has to evolve in order to make effective use of powers and resources. It seems that there are three steps of evolution in local governance. The fi rst step is responsive type of local governance, the second step is the network type of local governance, and the third step is the partnership type of local governance.

1. The responsive local governance means the good governance of local government. Also it has the effective and effi cient public service provision. Responsive local governance ought to carry out its duty of responsibility and accountability for local people, and provide the chance of citizen participation. While citizen participation is increasing, local governance begins to change to the network governance.

2. The network governance is composed of the cooperation and responsiveness of local actors. Local actors are mutually networked and exchange their information among them. The community action group, private company, and NGOs are the actors. Also there is networking among local government and many local


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actors which operate to organize the network issue and then policy network in specialized areas. This network functions in the participative decision making process of local government which attain more effective and effi cient policy outcome. In the network governance, the actors learn and grow in the operation of local governance, which is the governance partnership.

3. The governance partnership, providing that the local people acquire maturity as an owner and user of power and control in locality, is characterized by the equal partnership between local actors and government, the cooperation of provision of public services among them, and the effective and effi cient use of local resources through this cooperation. The governance partnership will keep and secure the sustainability of community.

Local Government Reform

Toward local good governance, the local government and local people have to change themselves. The local government is a most important actor in the community life and has to be reformed for new local governance.

Attaining a good governance of local government itself, there must be capacity building of local government, which includes the local government reform, the increase of organizational capability of good decision making and service provision, the stable and good fi nancial condition of local government and community, and the capacity building of local public personnel.

The local government reform is usually adopting the following measures; cost cutting, restructuring and re-engineering, privatization and outsourcing, and

performance measurement and policy evaluation.

In those reforms, the critical element is the local public personnel and the local people. Their capacity building is decisive for the function of local governance. In order to build their capacity, there must be the chance to train and participate in the partnership scheme of local governance. Concretely speaking, the participatory planning, practicing and evaluating of the performance of local governance provide the opportunity for training towards a new local governance.

The need to build local-level capacities should have the people at the center. It is their performance that needs organizational and material support and their actions that accomplish results. Lip-service has been given to people as the most important resource but it is ironic that countries lagging behind in development still have not adequately established the means to harnesses their biggest resource. This challenge even becomes greater in the context of decentralization of government.

B. Local Governance Capacity-Building

There is often a debate on whether decentralized governance policies should wait for local capacity to be adequate before they are put in place. This debate is not necessarily misplaced but it often misses the point of answering the question as to who are the actors in local governance and therefore whose and which capacities should be developed.

Should we wait for local governance capacity to develop?

The argument commonly presented is that local people do not have the requisite capacity for managing local governments, and therefore functions, responsibilities and resources should not be devolved to them.


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In most cases, such an argument stands in the way of decentralization. Admittedly, it is true that most developing countries present peculiar conditions of multiple weaknesses in capacity where their public sector, civil society, and private sector are weak. However, within the argument of capacity-building for local governance are carried undertones of colonialism. Since the process of development is a process of capacity-building, a country cannot afford to wait for the local governance capacity to develop.

During the 1950s, for example, when Africa started clamoring for political emancipation, the colonial powers at the time were quick to respond that Africans had no capacity to govern themselves. The response from Africa was unanimous. Capacity or no capacity, they had a right to determine their destiny. “By what God-given right are you, the British, empowered to decide the fi tness or otherwise of we Africans to govern ourselves?” one of the characters in the famous novel A Wreath for Udomo by Peter Abrahams4 asked.

It should not be for the same African leaders who posed this question to reject decentralized local governance telling their compatriots that they lack the capacity to govern themselves. This would be local colonialism. Development is a process of progressive and qualitative movement from inability to ability, from incapacity to capacity. Therefore, it is conceptually normal to start from a point of weak local governance capacity and work towards strong local governance capacity. Without this pre-disposition, decentralized governance in most developing countries may never be embarked on.

We could use an analogy of building the capacity of a soccer team. It is impossible to build the capacity of a team if the team is not constituted in the fi rst place. It is impossible to build the capacity of local governments if local governance structures are not put in place within a clear

policy that provides for, among other things, building local governance capacity. How would the capacity of a local council, a local executive committee, a local community development non-governmental organization, a local development planning committee, etc. develop if such structures were not constituted in the fi rst place?

Whose capacity to develop for local governance?

In addressing issues related to capacity-building for local governance, the tendency is to focus on local government structures such as local government councils, civil servants, local government executive committees, etc. However, taking the understanding of local governance we have adopted, this would be inadequate, for it leaves many players in local governance out of capacity-building efforts. The appropriate way to address the issues and problems of capacity-building for local governance is to fi rst conduct the identifi cation and analysis of the stakeholders and key players. This would enable us fi rst to know who they are, and second to understand what capacities they possess as well as what capacities they lack. We would propose a stakeholders analysis model that departs from a simple question. Who are the stakeholders and key players in local governance? The diagram below gives a simple framework for the analysis of local governance actors.

When it comes to local governance, there are many stakeholders and players. They are in the public sector, in the private sector, in civil society, among donors and development partners, and at the local community, national, regional and international levels. The capacity, or lack of it, for local governance cannot and should not be pinned only on the local community in question. The appropriate predisposition for capacity-building for local governance is to assess each player’s capacity vis-à-vis their roles so that each one’s capacity


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is strengthened to play that role effectively. For example:

• While in many countries central government authorities hesitate to embark on decentralized governance policies for reasons related to inadequate capacity at the local level, it has been discovered that the same central governments do not possess the adequate capacity to analyze, formulate, and effectively manage decentralized governance policies.

• While many donors and development partners have a tendency of blaming local governments of having no capacities to implement local-level development projects, it is often the case that the same donors and development partners do not have the requisite capacity in terms of understanding and working within the local community’s cultural and social environments to promote community sensitive development.

The real situation in many developing countries is that inadequate capacity is a

problem found among almost all players involved in decentralized governance. The difference is in the extent and degree to which the capacity is lacking.

In the context of an increasingly globalizing world, the challenges and requirements of capacity-building for local governance should always be analyzed and diagnosed, taking into account the full range of stakeholders’ and actors’ analysis at the community, local, national, regional and international levels. Such an analysis should always be conducted in a participative manner to allow the stakeholders and actors involved in local governance to share a common understanding of one another’s strengths and weaknesses. This would in turn facilitate the process of cooperation, harmonization, and synergy in capacity-building activities. The framework given in the diagram below was used to conduct a governance capacity assessment in Uganda, Rwanda, Liberia, and Tanzania, and was found to be very useful.

Local governance capacity-building for full-range participation (Four Ps +C)

We have belabored the point on local governance as an all-actors-embracing situation, because experience has shown that


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in most cases local governance capacity-building programs, projects and activities concentrate on local governments. We need to maintain the distinction between local governments’ capacity-building, which would concentrate on local governments, and local governance capacity-building, which would emphasize strengthening the capacities of all the actors in governance at the local level. This would set the appropriate parameters for effective participation in the development process by all actors.

Diagram 5: Grass-roots local governance stakeholders and actors analysis framework

Participation is not a matter of only structural arrangements. It is also a matter of will and capacity. Most advocates of local governance as a vehicle for promoting socio-politico-economic development always bank very strongly on the argument that decentralization encourages participation of the local people in determining their development and well-being. However, in the context of poor countries, the

extent and nature of the participation itself needs to be understood more deeply.

We are proposing to examine it using the 4 Ps plus C of participation. If participation has to be complete, it must be done at fi ve levels: Priority setting, Planning, Producing, Paying (fi nancing) and Consumption. It is the consumption that leads to livelihood, but when it is not supported by participation in setting priorities, planning, production and paying, then it is not sustainable. The biggest problem for developing countries is that because of very low or sometimes no income, people expect to participate in consumption without participating in paying. This makes consumption unsustainable because there is no support for production5.

On the other hand, often those in positions of authority concentrate on promoting the participation of local people in the four Ps, but they do not provide for participation in


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consumption. The consequence is that the poor do not see any change in their livelihood even when they have participated.6 It should be noted that for purposes of mobilizing the local people to participate, an objective that points to the possible improvement in their consumption is more attractive than any other and therefore worth mentioning.

Local governance, when well practiced, more easily and more evidently encourages political participation (e.g., in taking decisions and having a say in who takes up leadership positions), production and delivery by narrowing the physical distance between the service producers/deliverers and consumers as well as by allowing the private sector and NGOs to engage in service production and provision.

However, it has to be recognized that when it comes to participation in fi nancing the production and provision of these services, the poor are at a loss. The challenge for developing countries, given their situation of extremely low incomes, is how to encourage the poor to participate in fi nancing the services they need. Most poor populations are quick to advocate for participation but when it reaches the level of participating in the fi nancing they still want some donor or central government to foot the whole bill. The central government

on its part gets money from taxes paid by the people; but however effi cient and effective a tax system is, if it is taxing a poor population, it will yield poor revenues. There is a limit beyond which a hungry person can milk a hungry cow. The fundamental problem with most developing countries is that they suffer from a double weakness: their central and local governments are weak while at the same time their private and civil society sectors are also weak (vertical and horizontal weakness). This double weakness is not only in terms of resources (human, material and fi nancial), it is also in terms of institutions, systems, information, networking, skills, knowledge, etc.

Conceptually, all countries could be placed in four categories as follows: the strong ones where the central and local governments as well as the civil society and the private sector are all strong A); the partly strong ones where the central and local governments are strong but with a relatively weak civil society and private sector (B); the partly weak ones where the central and local governments are weak but the civil society and private sector are relatively strong (C); and the weak ones where the central and local governments are weak as well as the civil society and the private sector (D). Most sub-Saharan African


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countries, especially those that are LDCs, are in category D.7

A fundamental component of local governance capacity-building should be dedicated to strengthening the capacity of local communities to generate sustainable income. It is true that the common practice in African countries where the central government controls a lion’s share of revenue at the detriment of local governments undermines local governance capacity-building in respect to priority setting, planning, local capital investment, and eventually consumption. However, the point that the revenue of local governments is just a component of the fi nancial capacity of local governance should not be lost. Local governance fi nancing should not be seen from the point of view of central government and local government revenue-sharing alone. It should be examined in the light of the fi nance deployment policies of all actors as well. There are many fi nancing institutions—local, regional as well as international—who hesitate to disburse funds to the local community level either because the local levels do not provide guarantees for the funds or because the central government does not accept such disbursements, or both. This jeopardizes the development of the capacities of local communities to manage programs, projects, and funds even when they have participated in the formulation of such programs.

A local governance policy that is conceived with capacity-building in mind should include provisions for fi nancing systems that would put funds at the disposal of the local level so that such funds not only cater to the needs of local communities but also provide opportunities for them to develop revenue generation and fi nancial management capacity.8

C. Development Work in Decentralized Governance

For community based development, good governance becomes very important and

simultaneously it is at the local community level good governance is operationalized in its total capacity. Community based development is people side development. Here people are not only the benefi ciaries of the schemes and plans worked out by someone unknown to them who are usually referred to as ‘those who govern’ but they are the planners, implementers and also one who evaluate it and plan for the future.

One of the important issues any good governance has to address is poverty alleviation and in a special way rural poverty reduction. The following are some of the areas that need specifi c focus:

1. Rural poverty reduction increasingly requires better allocation and distribution of resources. That is, control over resources like water, land and forest. There is an irrefutable connection between the asset distribution and poverty alleviation.

2. Institutions, markets, technology policy and asset arrangements need to refl ect the critical role of food security. We have to go further and call for food sovereignty.

3. Increased growth alone will not lead to alleviation of poverty. How this growth is redistributed to all the segment of the population is the crucial aspect.

4. The most disadvantaged and vulnerable groups should get the priority in terms of poverty alleviation programs. Often times these are the people who are real producers, but do not have access to what they produce.

5. Partnership and participation is the strategy that would ensure the overall efforts to reduce poverty.9


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6. Finally, poverty alleviation cannot be looked at only from the perspective of economic parameters as is being done now. Poverty is fundamentally a social and political problem. Its economic shade is only the symptom. This means the restructuring of the social order alone will address the elimination of poverty and misery from the face of the earth.

Good governance also calls for a decentralized development and administration. This form of governance would ensure that the citizens are not just objects of development but subjects who take responsibility of their lives and their development. The above-presented diagram explicitates the need to build interface between various stakeholders in a society. Within the given political system usually one highlights the interaction between the government and the people. But the discourse on local governance and decentralized

governance laid equal stress on all the four agents of development.

D. Problems of local governance

Most countries have local authorities and some kind of decentralization does exist, at least on paper. Nevertheless, local governments are too often unable to perform even the very limited tasks they have been delegated. An analysis of such situations usually reveals many peculiarities stemming from the particular political, historical, legal, and socio-economic traditions of a specifi c country. Nevertheless, it is possible to list some common problems:

• Lack of resources. This is a common problem in many countries. Local governments have some powers to levy local taxes and fees but these monies are diffi cult to collect, and if


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collected are often insuffi cient to fulfi ll the tasks assigned to them. Access to central funds may be limited and diffi cult.

In addition, local authorities often lack qualifi ed and well-trained staff and therefore are unable to perform properly even if money is available. Lack of resources takes on dramatic forms if local governments are granted large powers that have been shifted from the center. In these areas, governmental activities may stop entirely and the center will be able to blame the local levels for such failure.

• Lack of or overlapping powers. Sometimes the powers of local governments are too limited to respond to the expectations of the population. More often, however, local governments possess broad powers, but central government offi ces are also competent to carry out such activities at the regional or local level. This leads to an unclear delimitation of powers and overlapping of activities. The result is that problems do not get solved at either level, and the people lose faith in both their local authorities and the central government.

• Lack of democratically elected local authorities. In some countries, local authorities are not elected by the citizens, but are instead appointed by the central government leadership. In other countries, elected bodies have been dissolved or local elections have not taken place for a long time. In these cases, government -appointed administrators have taken over the daily business of governing. In any of these cases, the local population may perceive the local offi cials as merely

agents of the central government, and therefore rejects their authority as representatives of the community’s interests.

• Lack of transparency and accountability. Corruption at the local level is a problem in some countries. It is more likely to take place where there is a lack of transparency and accountability. This is due to the fact that corruption is diffi cult to prove when government accounts are not accessible to the population and/or when there is no legislation that clarifi es the powers and duties of the different bodies involved in local governance issues. If local offi cials are accountable to several authorities, this will create confusion and insecurity at the lower level and thus hamper effi cient administration even more. In addition, accountability is lessened when local offi ce-bearers are appointed rather than elected, becausethere is then little chance that even proven instances of corruption will be remedied.

• Excessive control. A typical problem in many countries is that the higher levels of government (provincial or central) must approve the budget before the local government can spend anything. The approval is often delayed and the process is often used to impose many conditions on the proposal’s acceptance. The same is true for the required approval of contracts. In some countries, planning procedures are very complicated and slow, leaving local authorities no opportunity to decide where to set priorities. Often, local governments must get prior approval for all expenditures above a certain (usually minimal) level. Finally, a very effective control can be exercised


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through threats to dismiss the local body for not performing “properly” (i.e., according to the wishes of the center). Such control mechanisms ensure that local authorities are constantly supervised by the central government offi cials. This not only slows the progress of local activities, it cripples local initiative.

Lessons from Europe

It is sometimes feared that strong local governments will abuse their powers and use their position to gain more power rather than to foster local development. Comparative studies carried out in Europe are of interest in this context because they reveal a strong relationship between the degree of autonomy and resources of a municipality and the attitudes and behavior of its mayor.

Different roles of local governments

In some parts of Europe, the prevailing view of the role of local government is that it should primarily be the providers of services and agents of development at the local level. Local leaders should focus on responding to the needs of the population concerning practical matters such as maintaining local roads, collecting solid waste, or taking care of the sewage system.

One author recently stated that in Switzerland, especially in smaller municipalities, political parties play a rather unimportant role in local politics. The mayor has to run an administration providing services in areas such as education, water, sanitation, local roads, and public assistance to the poor and unemployed.

The mayor will be reelected if these services are well provided without overspending. If the mayor succeeds in presenting a budget that allows for lowering the local taxes

without reducing any services, reelection is guaranteed.

Thus, the ideal Swiss mayor is more like a manager running a business than a typical politician: service- (and thus development-) oriented. A study by Edward C. Page has shown that Scandinavian and British mayors and their municipalities are as service- and development-oriented as their Swiss colleagues.

In other parts of Europe, local governments are seen as supporters of the central government. Many mayors in countries such as Italy, Spain, or France undertake fewer initiatives for their municipalities as service-providers. These mayors primarily see themselves as politicians, and act accordingly. The party politics from the central government extends to the local levels and affect the lives of the citizens much more directly than in Switzerland or Scandinavia. Success is not “evaluated primarily in terms of the use and allocation of local resources” but rather in terms of the offi cial’s “ability to bring in benefi ts from the outside”.

As described by one author, these mayors are primarily ‘policy-brokers’, i.e., persons “negotiating, bargaining or otherwise attracting scarce resources”. A mayor’s ability to succeed thus depends on developing personal connections to politicians at the national level and on being able to offer benefi ts to the central offi cers in return for receiving their resources.

The benefi ts the local government offi cial can offer the central government, put very simply, are votes for the party in national elections. Thus, the local mayor is the representative of the party at the local level who must make sure that the majority of the citizens in the municipality will vote for the party. To make sure that this will happen, the mayor can offer local supporters favors (for example, jobs or benefi ts from projects). This type of mayor


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is a key actor in an intricate web of personal relationships both going up to the national politicians as well as going down to his citizens at the municipal level.

In some parts of Italy, e.g., these relationships are straightforwardly clientelistic.

Those in power can grant favors even outside the law and they can withhold rights granted by the law.

According to a study in the Southern Italian city of Palermo, “ordinary citizens, and in particular the poor, disadvantaged by their illiteracy and lack of experiences in dealing with bureaucratic institutions are constrained to seek assistance from a higher status ‘patron’ who can intervene directly on their behalf”.

Thus, in that city, the individual politicians and the political parties play a “critical intermediary role ... in every transaction between the citizen and the state”.

The reason for the differences in roles of local government

Why do these differences between mayors exist in different parts of Europe? A possible explanation rests on the different religious and cultural traditions of the areas. The Northern European countries are mainly offi cially Protestant, while the Southern European countries subscribe to Roman Catholic traditions. The cultures are also very different. However, neither the religious nor the cultural argument is very convincing, as the service-orientation of local governments can also be observed in those parts of Switzerland that religiously and culturally belong to Italy and France, or in the autonomous regions of Spain.

Instead, it appears that the differences between the two types of heads of local governments can be attributed to the very different position of local governments in these countries:

• As mentioned, many mayors in countries like Great Britain, Norway, Denmark, Sweden and Switzerland are service-oriented. These countries share the common characteristic of local governments with a high degree of independence from thecentral government. Moreover, the local governments are provided with the resources to allow this autonomy to work.

In Switzerland, the position of local governments is very strong: their share of total public expenditures is 30 percent; they also raise approximately 30 percent of all public revenue and thus, at least theoretically, are able to fi nance themselves. The Swiss local governments can decide how much to tax their citizens and collect the taxes themselves. They are allowed to carry out their activities and projects with very little prior administrative control. The same is true for the Scandinavian countries and Great Britain. Local governments in these areas spend from to even 50 percent (as is the case in Denmark) of total government expenditures and employ 40 percent and more of all employees in the public sector.

Even more important is the fact that control by the central government over the activities of the local governments tends to be limited to an examination of the legality of the behavior of municipalities. Thus, the central government does not deal with all the details of the activities carried out by the local government and does not approve or disapprove projects in advance.

• In contrast, the municipal governments in many parts of Southern Europe are


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dependent upon the central party-led politics. These local governments spend less than 12 percent of public expenditures and the percentage of employees in the public sector is likewise below this level.

Central government (with its agencies) deals with many aspects of everyday administrative life on the local level, as 90 percent of all persons employed in the public sector work for the central, rather than the local, government. In addition, local governments are supervised by the regional offi ces of the central government. This supervision is very intrusive to the activities of the local offi cials, because many actions must be approved before being undertaken by the municipality.

Under such circumstances, there is not much left for the mayor in the area of providing services effectively and running the communal administration smoothly. Due to this dependence on the central government, it makes sense for local leaders to concentrate on the relationship between municipality and center and to try to get as much as possible from the central level rather than to attempt to provide the local citizens services directly.

In his book, Page emphasizes another important difference between Northern and Southern Europe. In contrast to Southern Europe, mayors in Northern Europe have to share their decision-making powers much more with other members of their council. As a result, they are bound into a system of internal checks and balances.

It can be concluded that the degree of autonomy and resources given to local governments is one of the most important factors for shaping the attitudes and roles of

their organs. A low degree of administrative control is also a signifi cant factor. The more autonomy a particular local government has and the more resourceful it is, the more service- and development-oriented it will be.

IV. The Philippine Experience

A. Historical Background

Present Philippine political culture evolved over centuries of colonial rule, which exploited the indigenous culture for its own benefi t. Pre-colonial Philippines was decentralized and characterized by the barangay: a politically, socially, and economically independent village that was generally self-contained and self suffi cient and ruled over by a chief or datu (Abueva, 1988: 23). The datu’s relationship with others in the barangay was marked by ‘reciprocal rights and obligations and by authoritarian responsibility and power to impose accepted rules of conduct in the community’ (Jocano, 1975: 176-7 in Abueva, 1988: 23). A council of elders advised the leadership, and this was the mechanism for participation in governance (Marcos, 1978: 3-4 in de Guzman et al, 1988: 209).

The arrival of the Spanish in 1656 brought with it a centralized authority and territorial boundaries. The barangays were transformed into barrios and the datus relegated to the role of tax collectors—the cabezas de barangay. Other local government units established were pueblos (municipalities), cabildos (cities), and provincias (provinces) (Fernandez & Sison, 1975: 1476 in de Guzman et al, 1988: 209). ‘There was no real participation nor representation even in the municipal governments.

This system of local administration was oligarchical rather than democratic. Political offi ce was monopolized by a small group of “bosses” in each community. Venality, widespread but petty, fl ourished.


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In the Hispanic world this system has come to be known as “caciquism.’” (Phelan, 1959: 127 in Abueva, 1988: 27)

Spain also introduced elections and municipal elections, not with the interest of democracy but rather to impose order. By supporting one of the political candidates, they increased factionalism, subtly teaching Filipinos to use government for personal ends not public good (Paredes, 1989). Independence at the turn of the century saw ‘the most ample decentralization and administrative autonomy for local governments, popular and direct elections of local offi cials, and provincial and municipal taxation.’ (Brilliantes, 1982, cited in Villarin, 1996) Provincial and popular assemblies were organized and local councils were based on the principle of greater participation of the people in local governance, including the principle of direct and popular elections.10

This Malolos Republic was short-lived. The swift arrival of the Americans saw a continued exploitation of patronage politics, which was by now ingrained. Under American rule, provincial power-holders maximized representative structures to extend autonomy at the local level, expand national legislative authority, and create more opportunities for patronage.

At no point during these apparently decentralizing periods could the Philippines have been called a democracy. Electoral objectives rather than administrative effi ciency or democratic ideals determined the relationship of the locality to the center. The upshot of colonial rule was that political participation was limited to those who spoke Spanish and English (Anderson, 1998 in Gatmaytan, 2001: 91). Colonial infl uence paved the way for the elite democracy, an oligarchy that began its rule at the start of independence. One writer notes that after independence citizens remained ‘poorly integrated into the functioning of interest groups, parties, the Congress, and the bureaucracy.

Unorganized and unable to see their individual problems and interests in terms of policy changes, they could neither assert the necessary policy demands on legislators or administrators, nor provide adequately the required public scrutiny and support needed by a well functioning democracy.’ (Abueva, 1988: 53)

This did not change in the following years and the people became even more marginalized from the ruling class. Whereas Spanish and American rule had strengthened local power-holders, when Ferdinand Marcos established martial law in 1972, he slowly began to concentrate political and economic power in the center, commonly referred to as Imperial Manila.

To consolidate his powers, Marcos abolished the bicameral Congress and laws were instead enacted through Presidential Decree. Local governments were also restructured to facilitate control over them. Martial law also affected the basic political and civil rights of the people: elections were temporarily suspended and political parties disbanded. Alternative mechanisms for participation were tried, including citizens’ assemblies in the barangay, although these were considered inadequate substitutes (de Guzman, 1988: 269-271).

There was a strong adherence to the center-periphery theory of development whereby the benefi ts of economic growth at the center (effectively the top) would eventually ‘trickle down’ to those at the periphery. Typically, to get funds for a project, local offi cials would need the approval of ‘Manila-based bureaucrats’ which, to all intents and purposes, meant time, money and connections. In practice only those physically or politically close to government actually benefi ted, through rent-seeking and corrupt self-serving practices. Marcos replaced a system marked by violence and rent-seeking at the local level with a similar more centralized one revolving around his family and cronies (McCoy, 1994).

These experiences shaped Philippine political culture and set the mold for how citizens would


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participate in governance. Hierarchical structures and the power relations that accompany them are an integral aspect of Filipino culture, and from the pre-colonial period to the present time, the culture of leadership has been distorted as different powers exploited the existing relations. Trapo or traditional politics, wherein the elite control electoral processes, became the only arena for political participation.

The Triumph of People Power:Re-democratization or Restoration of the

Oligarchy?

The turning point came in 1986 when one million Filipinos from different walks of life converged on a major highway, Epifanio De Los Santos Avenue (EDSA), to assert what has become their own brand of political participation—‘people power.’ After deposed President Marcos fl ed the country, Cory Aquino assumed the Presidency with corresponding emergency powers. Aquilino Pimentel, author of the Local Government Code, was chosen as Secretary of Local Government and tasked with appointing offi cers-in-charge (OICs) in all the provinces who would be supportive of President Aquino.

This was a crucial time in Philippine history because President Aquino was presented with the opportunity to actualize real change. The popular movement that had kicked out Marcos comprised a broad spectrum of the population: from the national democrats on the left who had been fi ghting the dictatorship since the seventies, to the country’s elite who had turned against Marcos in the fi nal hours to protect their own interests.

It is very tempting to say that coming out of martial law was the start of re-democratization. Some schools of thought would, however, question this. Although the progressive forces on the left had been the linchpin of the anti-dictatorship movement, as

the political terrain altered, they needed new terms of engagement with government, which led to mistakes and ultimately the weakening of their political capital. The old elite, on the other hand, was able to consolidate its forces and ensure that the post-dictatorship system would still protect its interests.

From this viewpoint, the 1987 Constitution is effectively a restoration of the pre-martial law political system with a president and bicameral legislature, which handed control back to the elite.

Concessions were made to the anti-dictatorship movement without creating a signifi cant threat to the old social order, so the progressive agenda such as social justice, human rights and participation principles were included. Decentralization, however, was also written into the Constitution, which was a signifi cant change to previous forms of government. Indeed there was a widespread association of centralized government with Marcos-era authoritarianism and the concurrent presumption that high levels of decentralization essentially favored democracy.

B. Decentralization in the Philippines

In addition to adopting a system with a bicameral legislature and president, the 1987 Constitution also provided for the decentralization of the administrative system as discussed above. The Constitution—in Article Ten, Section 3—called for the enactment of a law on local autonomy and decentralization:

“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.”


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In Section 25, the Constitution also provides that “The State shall ensure the autonomy of local governments.” Aquino considered decentralization to be the key element of re-democratization (Bossert and Bowser, 2000). Five years later the Local Government Code (RA 7160) was passed by Congress. This is a devolution policy, by defi nition a political decentralization involving transfer of substantial functions, resources and power from the central to the periphery. Administrative decentralization or de-concentration had been resorted to several times in the past as powers were transferred not to local government but to the local, fi eld offi ces and extended arms of national agencies. In devolution, according to the Code’s premier author, Aquilino Pimentel Jr. (2000:1), “only Constitutional and legal limits constrain the use of devolved powers, functions, and money.” Decentralization is argued to improve governance and public service by increasing allocative and productive effi ciency (World Bank, 2001 [a]). Local governments can determine local preferences better than the national government and can therefore tailor services to these preferences. Decentralization is also supposed to rationalize costs. By taking government closer to the consumers, accountability is enhanced, bureaucracy is minimized, and local costs are better taken into account. With devolution, “the nation’s governing structure is being recast from top to bottom in a process as consequential on the political front as liberalization initiatives are on the economic front” (Hutchcroft, 1996: 14). It was seen as a triumph of civil society that backed Aquino and of local offi cials who were tired of securing permits from Manila to do as little thing as buying a garbage truck (Arroyo, 2001). The Code aimed to achieve those goals by its sweeping provisions that:

• devolved the responsibility for basic a) health services, b) agriculture, c)

social welfare, and d) environmental programs from national government agencies to provinces, cities, and municipalities, with corresponding power and resources, and to a limited extent, to barangays;

• increased the share of LGUs from internal revenues and enlarged local revenue-making powers;

• mandated wider private sector and people’s participation in local government decision-making and implementation, and instituted local special bodies such as health boards, school boards, development councils and pre-qualifi cation, bids and awards committees, and,

• gave new meaning to local democracy and autonomy by instituting measures to promote local accountability.

In the area of human resource management, local governments are given authority by the Code for organizational development and HRM in the following provisions:

“Section 3 (b) - There shall be established in every local government unit an accountable, effi cient, and dynamic organizational structure and operating mechanism that will meet the priority needs and service requirements of its communities”;

“Section 18 - Local government units shall have the power and authority to establish an organization that shall be responsible for the effi cient and effective implementation of their development plans,


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program objectives and priorities”;

“Section 76 - Every local government unit shall design and implement its own organizational structure and staffi ng pattern taking into consideration its service requirements and fi nancial capability, subject to minimum standards and guidelines prescribed by the Civil Service Commission.”

The Code also provides for a Local Personnel Selection Board in every locality that shall advise the local chief executive in personnel recruitment matters, in an attempt to limit the infl uence of politics in selection.

Essentially, decentralization brings the government closer to the infl uence of

the people and thus provides them an opportunity to participate in day-to-day affairs. The LGC also acts upon the constitutional mandate to institutionalize active participation of citizens and POs/NGOs in local governance.

C. The Local Government Units (LGUs)

An archipelago of 71 million inhabitants, the Philippines is a unitary state with a presidential system of government. The territory is divided into 15 administrative regions, including the Autonomous Region of Muslim Mindanao in the south. Local government units—provinces, cities, municipalities, and barangays (villages)—are political subdivisions under executive supervision of the President and legislative control of Congress. The provinces coordinate the delivery of basic services while cities and municipalities bear the


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responsibility of direct service provision to villages. Local governments are empowered to create sources of revenue. LGUs in the Philippines are classified according to income level and most of them belong to lower-income categories. The lowest level of local government, the barangay, is supervised by either the

municipality or the city.

The categories of local authorities in the

Philippines are as follows:• 1 Metropolitan Government;

• 1 Autonomous Regional Government;

• 1 Special Administrative Region;

• 78 Provinces;

• 117 Cities;

• 1,600 Municipalities; and

• 42,000 Barangays

Each barangay is headed by a barangay captain, who presides over the barangay council (sanggunian). The League of Barangays currently has 41,939 members and is the largest NGO in Filipino civil society. Barangays also have a separate youth council to oversee the provision of sporting and cultural activities for local youth.

The 1,600 municipalities are units recognized as towns under the four-yearly population audits used to classify the distinction between towns and cities. Each municipality is headed by an executive mayor, who alongside the vice mayor, eight councilors and the presidents of the youth council and the local barangay union forms the municipal council. All are elected to three-year terms and may not serve more than three consecutive terms.

The 117 recognized cities belonging to the League of Philippine Cities are regarded

as belonging to the same sub-tier as the municipalities but are given more central government subsidy to fulfi ll their duties. Though they have the same governance arrangements as the municipalities, a number are awarded further distinctions by Congress in view of their large populations. As such, they are denoted as charter cities and fall into two classifi cation groups for purposes of self-government - chartered cities and component cities. Chartered cities, which include a number regarded as Highly Urbanized Cities, are accorded signifi cant powers of self-government and individual representation as congressional districts (which are otherwise based on provincial boundaries), while component cities are recognized only as titular cities. Three metropolitan areas exist in the Philippines, including the National Capital Region Manila, which consists of the city of Manila and 16 neighboring cities, including Quezon City (the largest in the country). The Manila Metropolitan Development Agency is a division of central government, with a chairman appointed by the president.

The province is however, the primary unit of local government in the Philippines, of which there are 79 in number (as well as the National Capital Region). Provinces are largely modeled on the three branches of central government, with an elected executive governor and their vice presiding over the provincial legislature. Similar to the sub-tier, there is ex-offi cio representation for barangay and youth council provincial presidents. The provinces are given presidential oversight through the Department of Interior and Local Government and grouped into 17 regions for administrative purposes at central government level. Two regions have political jurisdiction as recognized autonomous groupings of provinces, namely the Autonomous Region in Muslim Mindanao in the south west (adjacent to


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Malaysia) and the Cordillera Administrative Region of the indiginous Igorot in the north.

The local government personnel system is primarily governed by personnel policies of the Civil Service Commission and the applicable provisions of the Local Government Code, i.e. the Creation of Local Personnel Board and the Policy on Human Resource Development. The merit system is the guiding principle in the selection, recruitment and promotion of the officers and employees of the local government bureaucracy. Most locally appointed officers and employees are career personnel with security of tenure who can only be removed for cause. But culture, politics, and technical inadequacy have continually tarnished the image of the civil service, both local and national. All local government employees are covered with limited medical care and are insured in the Government Service Insurance System. Discipline over career employees is lodged with the local chief executives and the Civil Service Commission.

Local Government Functions

Local governments have four major categories of functions:

• Effi cient service delivery; •Management of the environment;

• Economic development; and

• Poverty alleviation.

The Local Government Code Section 447 (Municipal Governments), section 458 (City Governments) and section 468 (Provincial Governments) defi ne the functions and powers of the different local authorities. The provisions are standard and descriptive of the functions and powers of local government

and are similar to the provisions of Section 468 for Provinces. They stipulate that: “The Sangguniang Panlalawigan, as the legislative body of the province, shall enact ordinances, approve resolutions and appropriate funds for the general welfare of the province and its inhabitants pursuant to Section 16 of this code and in proper exercise of the corporate powers of the province as provided for under Section 22 of this code and shall:

1. Approve ordinances and pass resolutions necessary for an effi cient and effective provincial government and, in this connection, shall:

i. Review all ordinances approved by the sanggunians (councils) of component cities and municipalities and executive orders issued by the Mayors of said component units to determine whether these are within the scope of the prescribed powers of the sanggunian and of the mayor;

ii. Maintain peace and order by enacting measures to prevent and suppress lawlessness, disorder, riot, violence, rebellion or sedition and impose penalties for the violation of said ordinances;

iii. Approve ordinances imposing a fi ne not exceeding fi ve thousand Pesos (P 5,000.00) or imprisonment not exceeding one (1) year, or both in the discretion of the court, for the violation of a provincial ordinance;

iv. Adopt measures to protect the inhabitants of the province from the harmful effects of man-made or natural disasters and calamities and to provide relief services and assistance for victims during and


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in the aftermath of said disasters and calamities and in their return to productive livelihood following said events;

v. Enact ordinances intended to prevent, suppress and impose appropriate penalties for habitual drunkenness in public places, vagrancy, mendicancy, prostitution, establishment and maintenance of houses of ill repute, gambling and other prohibited games of chance, fraudulent devices and ways to obtain money or property, drug addiction, maintenance of drug dens, drug pushing, juvenile delinquency, the printing, distribution or exhibition of obscene or pornographic materials or publications and such other activities inimical to the welfare and morals of the inhabitants of the province;

vi. Protect the environment and impose appropriate penalties for acts which endanger the environment, such as dynamite fi shing and other forms of destructive fi shing, illegal logging and smuggling of logs, smuggling of natural resource products and of endangered species of fl ora and fauna, slash and burn farming and such other activities which result in pollution, acceleration of eutrophication of rivers and lakes or of ecological imbalance;

vii. Subject to the provisions of this code and pertinent laws, determine the powers and duties of offi cials and employees of the province;

viii.Determine the positions and the salaries, wages, allowances and other emoluments and benefits of officials and employees paid wholly or mainly from provincial funds and provide for expenditures necessary for the proper conduct of programmes, projects, services and activities of the provincial government;

ix. Authorize the payment of compensation to a qualifi ed person not in the government service who fi lls up a temporary vacancy, or grant honorarium to any qualifi ed offi cial or employee designated to fi ll a temporary vacancy in a concurrent capacity, at the rate authorized by law;

x. Provide a mechanism and the appropriate funds therefore, to ensure the safety and protection of all provincial government property, public documents, or records such as those relating to property inventory, land ownership, records of births, marriages, deaths, assessments, taxation, accounts, business permits and such other records and documents of public interest in the offices and departments of the provincial government; and

xi. When the fi nances of the government allow, provide for additional allowances and other benefi ts to judges, prosecutors, public elementary and high school teachers and other national government offi cials stationed or assigned to the province;


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2. Generate and maximize the use of resources and revenues for the development plans, programme objectives and priorities of the province as provided for under Section 18 of this code, with particular attention to agro-industrial development and country-wide growth and progress and relative thereto, shall:

i. Enact the annual and supplemental appropriations of the provincial government and appropriate funds for specifi c programmes, projects, services and activities of the province, or for other purposes not contrary to law, in order to promote the general welfare of the province and its inhabitants;

ii. Subject to the provisions of Book II of this code and applicable laws and upon the majority vote of all the members of the sangguniang panlalawigan, enact ordinances levying taxes, fees and charges, prescribing the rates thereof for general and specifi c purposes and granting tax exemptions incentives or relieves;

iii. Subject to the provisions of Book II of this code and applicable laws and upon the majority vote of all the members of the sangguniang panlalawigan, authorize the provincial governor to negotiate and contract loans and other forms of indebtedness;

iv. Subject to the provisions of Book II of this code and applicable laws and upon the majority vote of all the members of the sangguniang panlalawigan, enact ordinances authorizing the fl oating of bonds or other instruments of

indebtedness, for the purpose of raising funds to fi nance development projects;

v. Appropriate funds for the construction and maintenance or the rental of buildings for the use of the province; and upon the majority vote of all the members of the sangguniang panlalawigan, authorize the provincial governor to lease to private parties such public buildings held in a proprietary capacity, subject to existing laws, rules and regulations;

vi. Prescribed reasonable limits and restraints on the use of property within the jurisdiction of the province;

vii. Review the comprehensive land use plans and zoning ordinances of component cities and municipalities and adopt a comprehensive provincial land use plan, subject to existing laws; and

viii.Adopt measures to enhance the full implementation of the national agrarian reform programme in coordination with the Department of Agrarian Reform;

3. Subject to the provisions of Book II of this code, grant franchises, approve the issuance of permits or licenses, or enact ordinances levying taxes, fees and charges upon such conditions and for such purposes intended to promote the general welfare of the inhabitants of the province and pursuant to this legislative authority; shall:

i. Fix and impose reasonable fees and charges for all services


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rendered by the provincial government to private persons or entities; and

ii. Regulate and fi x the license fees for such activities as provided for under this code;

4. Approve ordinances which shall ensure the effi cient and effective delivery of basic services and facilities as provided for under Section 17 of this code and, in addition to said services and facilities, shall:

i. Adopt measures and safeguards against pollution and for the preservation of the natural ecosystem in the province, in consonance with approved standards on human settlements and environmental sanitation;

ii. Subject to applicable laws, facilitate or provide for the establishment and maintenance of a waterworks system or district waterworks for supplying water to inhabitants of component cities and municipalities;

iii. Subject to the availability of funds and to existing laws, rules and regulations, provide for the establishment and operation of vocational and technical schools and similar post-secondary institutions and, with the approval of the Department of Education, Culture and Sports and subject to existing laws on tuition fees, fi x reasonable tuition fees and other school charges in educational institutions supported by the provincial government;

iv. Establish a scholarship fund for the poor but deserving students in schools located within its jurisdiction or for students residing within the province;

v. Approve measures and adopt quarantine regulations to prevent the introduction and spread of diseases within its territorial jurisdiction;

vi. Provide for the care of paupers, the aged, the sick, persons of unsound mind, abandoned minors, abused children, disabled persons, juvenile delinquents, drug dependents and other needy and disadvantaged persons, particularly children and youth below eighteen (18) years of age and subject to the availability of funds, establish and support the operation of centres and facilities for said needy and disadvantaged persons and facilitate efforts to promote the welfare of families below the poverty threshold, the disadvantaged and the exploited;

vii. Establish and provide for the maintenance and improvement of jails and detention centres and institute a sound jail management programme and appropriate funds for the subsistence of detainees and convicted prisoners in the province;

viii.Establish a provincial council whose purpose is the promotion of culture and the arts, coordinate with government agencies and non-governmental organizations and, subject to the availability of funds, appropriate funds for the


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support and development of the same;

ix. Establish a provincial council for the elderly which shall formulate policies and adopt measures mutually benefi cial to the elderly and to the province and subject to the availability of funds, appropriate funds to support programmes and projects for the elderly and provide incentives for non-governmental agencies and entities to support the programmes and projects of the elderly; and

5. Exercise such other powers and perform such other duties and functions as may be prescribed by law or ordinance”.

Functions of local governments or their so-called traditional responsibilities include construction and maintenance of city/municipal or provincial roads, provision of health services and agricultural extension work. There are shared services that local authorities perform or share with the central government. An example is secondary education. Another is poverty alleviation. A new function that has been devolved to local governments in the Local Government Code is environmental management. Another is licensing fi shing vessels below 3,000 tons in weight.

Other devolved functions require local governments to improve their overall capabilities to perform. To achieve cost effectiveness in service delivery and in other local ventures, inter-municipal cooperation is highly encouraged. Section 13 Article X (Local governments) of the 1987 Constitution provides that: “Local government units may group themselves, consolidate or coordinate their efforts, services and resources for purposes commonly benefi cial to them in accordance with law.” The functional

dichotomy or relationship between the local chief executives and their deputies is quite distinct. The provincial governor or city and municipal mayor manage their political units including their respective bureaucracies. The vice-governor or vice city or municipal mayor acts as presiding offi cers of the local legislative councils. Local policy formulation is a shared responsibility between the local chief executives and the members of the councils.

Local Government Finances

Intergovernmental fi scal relations

Fiscal relations between national and local government centre on the following major areas of fi scal administration:

• Allotment of internal revenue shares;

• Shares of local governments in national wealth exploitation;

• Shares of earnings of government agencies or government-owned or controlled corporations engaged in the utilization and development of national wealth;

• Local government borrowing; and

• Review of local government budgets.

Local governments have their shares in the national internal revenue taxes, representing 40 per cent) of the total internal revenue collections based on the third preceding year (Section 284). The distribution of the Internal Revenue Allotment to local governments is as follows:

• Provinces 23 %

• Cities 23 %

• Municipalities 34 %

• Barangays 20 %


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The share of each province, city and municipality is as follows:

• By population 50 %

• By land area 25 %

• By equal sharing 25 %

Each Barangay should at least receive eighty thousand Pesos per annum. The Local Government Code provides that local governments shall have an equitable share in the proceeds derived from the utilization and development of national wealth within their respective areas and sharing these with the inhabitants by way of direct benefi ts (Section 289). Local governments, in addition to the internal revenue allotment, have a share of 40 per cent of the gross collection derived by the national government from the preceding fi scal year from mining taxes, royalties, forestry and fi shery charges, other taxes, fees, or charges, including related surcharges, interests or fi nes and from its share in any co-production, joint venture or production sharing agreement in the utilization and development of the national wealth within their territorial jurisdictions (Section 290). Local governments likewise have a share based on the preceding fi scal year from the proceeds derived from any government agency or government-owned or controlled corporation engaged in the utilization and development of the national wealth based on the following formula whichever will produce a higher share for the local government unit:

• 1 per cent of the gross sales or receipts of the preceding calendar year; or

• 40 per cent of the mining taxes, royalties, forestry and fi shery charges and such other taxes, fees or charges, including related surcharges, interests, or fi nes the government agency or government-owned or controlled

corporation would have paid if it were not otherwise exempt (Section 291).

At the same time local governments are authorized to issue bonds, debentures, securities, collateral notes and other obligations to fi nance self-liquidating, income-producing development and livelihood projects. However the power given to local governments in the issuance of bonds and other long-term securities is subject to the rules and regulations of the Central Bank and the Securities and Exchange Commission (Section 299). The Department of Budget and Management has the power to review appropriation ordinances of provinces, highly urbanized cities, independent component cities and the municipalities within the Metropolitan Manila Area (Section 326). An important provision in local fi scal administration within the context of intergovernmental relations is a provision that national planning be bottom-up to ensure that the needs and aspirations of the people, as articulated by the local governments in their respective local development plans, are considered in the formulation of budgets of national line agencies or offi ces (Section 350 K).

Local taxes

Local government taxation and other fi scal matters are contained in Book II of the Local Government Code. These include real property taxation, shares of local governments in the proceeds of national taxes, credit fi nancing and local budgets including property and supply management. Some illustrative revenue raising powers of local governments are:

Provinces:

• Real property tax;

• Tax on transfer of real property ownership;

• Tax on business of printing and publication;


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• Franchise tax;

• Sand and gravel tax;

• Professional tax;

• Amusement tax on admission; and

• Annual fi xed tax per delivery truck or van of manufacturers or producers of or dealers in certain products.

Municipalities:

• Tax on business;

• Fees and charges;

• Fishery rental or fees and charges;

• Fees for sealing and licensing of weights and measures; and

• Community tax.

Cities:

• The city may levy and collect among others any of the taxes, fees and other impositions that the province or municipality may levy and collect.

Barangays:

• Taxes and fees;

• Service charges; and

• Contributions

A comparison of the income profi les of local governments for the year 1992 (fi rst year of Local Government Code implementation) and year 1994 showed a decrease in income from local sources and an increase in national aid and allotments. In 1992 the income from local sources represented 42.76 per cent of total and non-tax revenues 15.99 per cent). During the same year aid and allotments from the

Table 1. Comparative Local Government Income Profi les1992-1995 (in million Pesos)

Income category 1992 Profi le 1995 Profi le

Income Local taxesTaxesReal property taxesBusiness taxesNon-taxesFees/chargesEconomic enterprisesLoans/borrowingOthersAllotment and aidsInternal revenue allotmentAids

27,703.511,846.67,416.73,922.93,493.84,429.9855.3

1,485.8392.9

1,695.915,856.915,473.2

383.7

100.00%42.76%26.77%14.16%12.61%15.99%3.09%5.36%1.42%6.12%57.24%55.85%1.39%

77,006.922,976.914,904.17,932.16,972.08,072.81,879.52,286.11,408.92,498.354,030.051,925.02,105.0

100.00%29.84%19.35%10.30%9.05%10.48%2.44%2.97%1.83%3.24%70.16%67.43%2.73%

Source: Department of Finance


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national government represented 57.24 per cent of the total local revenues, which came local revenues (taxation 26.77 per cent from statutory allotments or internal revenue allotments. However, income from local sources represented only 29.84 per cent of the total income in 1995, a decrease of 30 per cent from the 1992 level. Taxes from real

properties decreased from 14.16 per cent to 10.30 per cent. This can be attributed to the codal provision that broadens tax exemptions for real properties. Residential properties with market value of 175,000 Pesos and below were exempted from payment of taxes. This codal provision signifi cantly eroded the property tax base. Likewise national subsidies

Table 2. Share of LGUs to Total Budget (in billion Pesos)

Table 3. Actual Revenues of Local Government Units (1991-1995)


______________________________________________________________________________Table 4. Growth Rates of Local Government Units (1991-1995)

SourceGrowth rates (percentage)Growth rates (percentage)Growth rates (percentage)Growth rates (percentage)Growth rates (percentage)Growth rates (percentage)

1991-1992 1992-1993 1993-1994 1994-1995 AverageAverageRevenue from taxation

14.86 38.57 18.34 18.43 22.55

Real property taxReal property tax 6.83 25.94 17.61 32.27 20.66 Business taxes 25.45 52.75 19.00 5.82 25.76 Non-tax revenues -36.61 37.86 26.69 -3.09 6.21 Receipts from economic enterprisesenterprises

-4.34 21.98 23.52 -3.53 9.41

Fees/chargesFees/charges 17.17 64.48 13.22 15.94 27.70 Loans and borrowingborrowing

234.77 37.52 -33.06 79.74

Other receiptsOther receipts -60.69 -7.28 29.62 11.82 -6.63 Aids and allotments 50.50 76.34 17.90 58.63 50.84 BIR allotments 58.67 77.44 17.75 55.55 70.92 National aids -51.10 31.93 25.46 209.96 54.06 Total income 15.52 60.08 23.97 40.70 34.91

possible explanation for the decrease in incomes from local sources is the suspicion represented 70 per cent of the local total income in 1995. This 24 per cent increase of the statutory allotment was due to the implementation of the 40 per cent Internal Revenue Allotment (IRA) shares of local governments that became effective on the third year of implementation of the Local Government Code. While the national subsidy increased from 57.24 per cent to 70.16 per cent, the income from local sources decreased from 42.76 per cent to 29.84 per cent. One that local governments became complacent in collecting taxes after receiving the maximum IRA shares allowed in the Local Government Code. In effect, the signifi cant increase in the IRA of Local Government Units (LGUs) exhibited substitutive effect in terms of local tax collection. The other logical explanation is that local governments were still in transition and the exercise of the local taxing powers by local authorities were not optimized.

Growth rates of local revenues/IRA (1991-1995)

The growth rate of local revenue sources during 1992-1995 indicated an erratic performance

apparently due to the pains of the transition to decentralization. For the period 1992-1995 revenues from taxation had an average growth of 22.55 per cent compared to the growth rate of non-tax revenues that was only 6.21 per cent. Meanwhile aid and allotments had a growth rate of 50.84 per cent for the same period. There is a need to reverse this trend of increasing dependence of LGUs on IRA in order to provide the decentralization scheme with a solid fi nancial base that will institutionalize local autonomy in the long run. Local income should be raised to a higher level than the IRA a local government receives from the national government. An ideal initial percentage ratio between local sources and grants or subsidies from the national government is 50-50. However, local governments in the long run should aim for at least a 70 to 30 per cent ratio in favour of local sources to be truly autonomous and self-reliant. This could be achieved under an appropriate and more responsive policy environment on fi scal federalism.

Specifi c revenue sharing

Some programmes and projects for LGUs are based on certain specifi c grant


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criteria/formula such as urban population, incidence of poverty, population growth rate, annual average income, degree of urban environmental degradation, defi ciencies in basic services such as sanitation and waste water disposal, storm drainage and fl ood prevention, solid waste collection and disposal, roads/traffi c, water supply, public markets, slaughterhouses, bus terminals, etc.

Table 5. IRA Percentages of Provinces in Relation to Total IRA

NCR 8.95Region I 34.06Region II 38.67Region III 33.81Region IV 33.62Region V 36.44Region VI 28.88Region VII 25.53Region VIII 32.89Region IX 25.16Region X 29.41Region XI 29.18REgion XII 29.78

The above-mentioned criteria are basically used by the World Bank funded Municipal

Development Project (MDP) providing local authorities with loans and grants on a 70 to 30 per cent ratio respectively in order to address municipal infrastructure requirements.

In the social sector, some education and health projects of LGUs are also provided with central government grants based on their needs. Besides selected LGUs are required to put-up equity for the project to ensure goal congruence between national and local authorities. A similar fi nancing scheme is also used in the case of environmental and agricultural projects that fall within the ambitions of the national government social reform agenda. LGUs are provided fund support based on differentiated schedules of loans, grants and an equity mix depending on the income level of LGUs and the nature of a particular project or sub-project component (i.e. revenue generating or non-revenue generating). Higher subsidy is given to lower class LGUs and for non-revenue generating projects.

However, national government grants to LGUs for certain devolved responsibilities and activities have to be rationalized in terms of equity, externalities and economies of scale. Loans and grants for

Table 6. IRA as Percentage of GDP (Value in billion Pesos)


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Figure 3. Internal Revenue Allotment Sharing as to Municipalities, Cities and Provinces (1995)

Figure 2. Growth Rates of Revenues of Local Government Units


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these projects are channelled through the Municipal Development Fund (MDF) that is administered by the Bureau of Local Government Finance of the Department of Finance (BLGF-DOF). Another form of central government grant is the Local Government Empowerment Fund (LGEF); an intervention mode of lowering the incidence of poverty in 20 identifi ed poorest provinces in the country. Specifi c needs have to be

addressed such as agro-industrialization, community health services and other related concerns.

The way ahead

Despite some improvements in local fi scal administration, some patterns and problems remain. Local governments continue to treat IRA as dole out and LGUs increasing


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dependence on IRA has been observed as a proof that IRA has become more regular and predictable. LGUs have not exerted greater effort in raising revenues through the exercise of their taxing powers. The absence of straightforward performance indicators in Revenue Sharing Allocation, could undermine LGUs tax effort and operational effi ciency and accountability. Likewise, such unconditional grants cannot stimulate LGUs to engage in long-term capital investments and other development projects beyond the required basic services. However, as LGUs confront the challenges of devolution and as they become increasingly aware of the extent of their responsibilities, there is now a growing clamor to revise the present IRA formula because it has resulted in inequitable increments for the different levels of LGUs. More and more LGUs especially the urbanizing ones are beginning to realize the importance of mobilizing local revenues and even availing of credit fi nancing to underwrite the massive fi nancial requirements of devolution and development. Besides, the mandatory review of the Local Government Code after 5 years of implementation is underway. This is now the opportune time to revisit the present IRA formula as contained in the code.

The issue of fi scal federalism is central to the success of the decentralization programme in the country. The fact that there are gainers and losers among different levels of LGUs under the new IRA formula and that national government continues to fund some devolved responsibilities, strongly suggests the need to review the present expenditure assignments between national and local governments to once and for all minimize if not totally eliminate the overlaps and duplications currently existing resulting in economic ineffi ciency. To rationalize the IRA formula, there is a need to establish certain minimum Civil societies are represented in various local development

councils. Several administrative orders of the central government implementing the constitutional provision and the intention of the Local Government Code regarding public participation standards of service delivery by sector upon which the IRA formula should be partly fashioned. Apart from the minimum standards of service delivery, an incentive feature should also be present in the formula to encourage LGUs to exert greater tax effort and embark on development projects beyond the basic services they are supposed to deliver. Administrative and operational effi ciency should also be rewarded using the national grant through special projects. A portion of the IRA could be transformed into a specifi c grant tied to tax effort or its variant. Provision of national government grants over and above the IRA, for devolved activities should be strictly justifi ed on the basis of equity, externality and economy of scale and such intervention should be in a form of matching grant and must be specifi c and time bounded. The LGUs must put up equity to the grant in order to have a sense of ownership of the project and also to ensure goal congruence.

The Philippines may have taken signifi cant strides in the implementation of devolution. Power relations between the national and local governments have been reconfi gured. However, fi ve years later in spite of the gains achieved by devolution, there are still a number of issues to be addressed. Foremost is the issue of fi scal federalism and central to this issue is the IRA formula. The formula is devoid of any performance indicator, thus threatening the agenda of devolution in terms of equity, fi scal performance and effi ciency in service delivery. It is imperative therefore to establish certain parameters/indicators of performance to apply to the Revenue Sharing Allocations in order to ensure vertical and horizontal balances as well as fi scal empowerment of LGUs as these are the heart of decentralization.


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Central-Local Links

After the approval of the Local Government Code in 1991, intergovernmental relations tilted more towards local autonomy and decentralization. Most departments of the national government are now primarily responsible for policy formulation and standard setting in addition to implementing national sectoral or departmental programmes after consultation with local governments. The power of general supervision by the President over local governments as provided for in the Constitution is now limited and extends only to Provincial Governors and Mayors of highly urbanized cities. General supervision over lower level local offi cials is entrusted to the Provincial Governor and to some extent to the local legislative councils. The national government has no control over local governments except for the power of general supervision. The national government cannot abolish a local government. The legislature can pass a law abolishing a local government but only after the law is approved by the people through a referendum. Political jurisdictions are governed with full administrative autonomy. However, the national government still exerts infl uence and regulatory powers in fi nancial matters as far as the review of local budgets and the utilization of national government subsidies are concerned. National government under certain circumstances likewise guarantees loan application of local governments and regulates the issuance of local government bonds.

Local Sectoral Representation

Pursuant to the constitutional mandate,11 the LGC provides for local sectoral representation in the local legislative assemblies (sanggunian panlalawigan, or provincial council, sanggunian panlungsod or city council, and sanggunian bayan, or municipal council). Three seats will be reserved for sectoral representatives of women,

labor (agricultural or industrial) and one from urban poor, indigenous cultural communities or disabled as determined by the Sanggunian concerned.12

The proponents of local sectoral representation were clearly in favor of democratizing local governance. The decision of the Constitutional Commission to reserve seats for marginal sectors was both a recognition of elite dominance in local governance and politics and an affi rmative action to help redress the power balance, providing the under-represented and marginalized sectors the opportunity to participate in decision-making that is relevant to their sectors and communities (Gatmaytan, 2001:103).

Local sectoral representation is not a new concept. President Marcos issued a decree on local sectoral representation in 1975. However, these representatives were to be appointed rather than elected to the position and the decree was never fully implemented.13

Experiences in Local Sectoral Representation

Sectoral representatives to local sanggunians have not been elected because a law determining the manner of elections of local sectoral representatives has still to be enacted. There is debate as to whether this is necessary. Senator Pimentel claims the LGC already has provisions on the elections of sectoral representatives, and a specifi c law is no longer necessary.14 The Comelec did in fact issue implementing rules; however, after a ‘rider’ provision was inserted into the Electoral Reform Law, they withdrew the rules.

The Department of Interior and Local Government (DILG) has issued opinions that LSRs cannot be dispensed with even if local government units face fi nancial constrains and diffi culties.15 Furthermore, the Department declared that there shall be three (not one or two) sectoral representatives in each of the provincial, city and municipal councils and that requirement is mandatory.16


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It seems that lack of political will is to blame for the continued non-implementation of local sectoral representation. Local government offi cials resist sectoral representatives on the grounds that they require additional resources which local governments cannot afford and they are redundant and unnecessary. It appears that local politicians are reluctant to share power.

Despite the lobbying of NGO networks such as the Local Governance Policy Forum (LGPF) and the Taskforce LSR, the passage of an enabling law is still not a priority of either the executive or legislative bodies.

Issues

• Whether or not sectoral representatives will be elected at large or only by their respective sectors

• Whether or not sectoral representatives will be directly elected at all levels (municipal, city, or provincial)

• How to prevent exploitation of the local sectoral representative system by non-marginalized groups

• Sectoral representatives might not be regarded as ‘real’ members with the same rights and responsibilities as those elected at large.

• Where the compensation for additional representatives will come from

On September 22, 2005, Republic Act No. 9340 was amended calling for the synchronized election of Barangay and Sangguniang Kabataan (SK– the youth representative in local governments).

Barangay and Sangguniang Kabataan (SK) elections will be held on October 29, 2007 based

on the newly amended Republic Act No. 9340, approved on September 22, 2005 by the 13th Congress of the Philippines which prescribed that Barangay and SK elections would occur on the last Monday of October 2007 and in subsequent elections after three years. Currently, the 14th Congress of the Philippines are trying for the second time to reset the Barangay and SK Elections instead to May 2008 so the elections can be trial for the computerization of elections following REpublic Act No. 9369, also known as Amended Computerization Act of 2007.

The Barangay Justice Programme

The Barangay Justice Programme is the largest community voluntarism programme involving some one million-community mediators. It is a system of settling disputes outside the judicial courts without the coercive power of the state and by the people themselves under whose initiative community and individual disputes are amicably settled. This paralegal system has saved the government billions of pesos in adjudication costs besides an equally important contribution of maintaining peace and order at community level. The administration of justice is characterized by an over clogging of dockets in the courts, resulting in the delay in the dispensation of justice. To remedy this situation, the government established the Barangay Justice Programme in 1978 which involves 42,000 Barangays organizing mediation boards which are mediating disputes outside the courts. The review tier of local law stops at the Provincial Government. Municipal laws or those of component cities are subject to review by the Provincial Legislative Council. Barangays ordinances are likewise subject to review by component cities or municipalities to which they belong. Except for controversial local tax laws, the national government has no control or supervision on local legislative making. The power of general supervision by the President as provided for in the Constitution has been decentralized and so there is tiering in the exercise of power of general supervision


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now shared by the President, Governors, City and Municipal Mayors.

Public Hearings

The local government unit is required to conduct mandatory public hearings to ensure that people are properly consulted in vital undertakings of their local government. Such public hearings are to be conducted by the sanggunian concerned in these specifi c cases:

• Reclassifi cation of agricultural lands17

• Enactment of local tax ordinance18

• Transfer of sites of public facilities, e.g., markets, public terminals, etc.19

• Closure of local roads, streets, alleys, parks or squares20

Although the Code outlines the mechanisms for consultations, its author, Senator Aquilino Pimentel, Jr., was concerned that the manner of consultations between government and NGOs/POs ought to be made more specifi c and mandatory, with sanctions against local offi cials who will deprive citizens of their right to participation in governance (in Villarin, 1996).

Local Special Bodies

Local special bodies (LSBs) are tasked by the Code to formulate policy recommendations, devise developmental and sectoral plans, and propose measures that will guide the sanggunian in enacting laws and steer, to an extent, the politico-administrative structures of local governments.21

The bodies include, but are not limited to:

Local Health Board—Proposes budgetary Local Health Board—Proposes budgetary Local Health Boardallocations for health programs to the sanggunian, serves as an advisory committee, and sets technical and administrative standards for health.22

Local Peace and Order Council—Assesses Local Peace and Order Council—Assesses Local Peace and Order Councilpeace and order situation, formulates, monitors, implements plans and programs to improve peace and order and public safety in the locality.23

Local School Board—Serves as an advisory Local School Board—Serves as an advisory Local School Boardcommittee on educational matters, determines supplementary budget for maintenance of schools, and authorizes disbursement of said budget.24

Local Pre-Qualifi cation Bids and Awards Committee—This is the deciding authority on bids and awards for local infrastructure projects, although its jurisdiction does not include procurement of supplies, purchase of offi ce equipment, renovations, and other local government unit disbursements. Two NGO representatives may sit to act as watchdog. This enforces accountability of public offi cials and transparency in government contracts.25

Local Development Council—It is here that Local Development Council—It is here that Local Development CouncilNGO representation is most prolifi c with not less than one quarter of the council consisting of NGO or PO representatives. This is at the barangay, municipal, city and provincial levels. The local development council is tasked to initiate and propose a comprehensive multi-sectoral fi ve-year development plan to be approved by the sanggunian, formulate public investment programs, incentives to promote infl ow of investment capital, coordinate, monitor and evaluate the implementation of development programs and projects.26 The local development council may also form sectoral or functional committees to assist them in the performance of their functions.27

The local development councils are to be convened at all levels of local governance from the barangay to the province. The other local special bodies are to be convened in all municipalities, cities, and provinces; however, there is no prohibition on barangays from establishing special bodies in addition to the local development council.


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The Code also provides for membership of representatives coming from the NGO-PO community in other local bodies such as the provincial, city and municipal councils on culture and arts and the council for the elderly; however, establishment of such bodies is subject to the availability of funds.

On 24th of July 2001 the Department of Interior and Local Government (DILG) issued guidelines on the accreditation of POs and NGOs in response to civil society lobbying because existing guidelines were hindering the re-constitution of the LSBs.28 The Memorandum Circular provided that local government units must fi rst issue a call for accreditation and then enact a resolution recognizing the accredited organizations. The LSBs should then be reconstituted and convened by the 14th of September 2001. The Memorandum Circular also includes sanctions for mayors who do not comply.

Despite these bodies being primarily advisory and recommendatory, NGO actors view their participation in LSBs as strategic. These are considered arenas for advocacy and strengthening of government capability at the local level and emphasis is placed on the quality of PO and NGO participation (Villarin, 1996:91).

Experiences in Local Special Bodies

(from Brilliantes, 1998; Romero, 1997; PhilDHRRA, 2001)

• Questionable representation. A recent study by Department of Interior and Local Government (DILG) showed that 33 percent of Private Sector Organizations/Civil Society Organizations in LSBs were appointed or selected by the LCE (Gabito, 2001). The study noted that just 15 percent of local government units in the country had accomplished and submitted the National Monitoring and Reporting Forms as mandated.

• Functionality. In the DILG study, on average just 56 percent of the LSBs were already convened in all the LGUs (Gabito, 2001). The quality of functionality is not addressed in this study; however, it is widely believed to be unsatisfactory.

• Capability. NGO representatives lack skills and background to be effective in LSBs.

• Participation. NGO participation is often token in LSBs.

• Venue for advocacy work. At least 42 NGO/PO provincial networks out of the 77 provinces sustained their development agenda through advocacy work in various LSBs and other special bodies created by LGUs (Liporada, 1997: 44)

Experiences Specifi c to Local Development Councils

(LDCs) (PhilDHRRA, 2001)

• LGU resistance to NGOs. Local offi cials may be worried that an institutionalized LDC can become a check to their actions. If an active LDC is partly composed of independent NGOs, then the local offi cials would likely fi nd it diffi cult to control them.

• Reluctance of NGOs to work with LGUs. Some leaders are concerned about co-opting their values if they work with local offi cials in the LDCs.

• Absence of accountability. Many local offi cials do not take LDCs seriously because LDCs cannot command accountability from them. The Code confers the LDCs with fundamental functions but it is not accompanied by authority. They can plan all they want, but under the Code they may do nothing more than propose. There are no sanctions when the LDC actions are not acted upon by the Sanggunian or


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higher LDCs. Also LDCs cannot command accountability from local offi cials because they are not elected bodies.

• Inadequacy of resources. LDCs were created to perform substantial development planning functions, but they were not given any resources or operational support to do so. This hinders institutionalization within the local government structure concerned.

• Size. LDCs are too large and unwieldy.

Issues

• Whether or not LDCs need to be restructured

• Whether or not LDC proposals such as the local development plan should merely be recommendatory to the sanggunians

• Need to increase frequency of meetings of the LDCs from at least twice to four times per year

• Need to provide budget allocation for LDC operations, i.e., 20 percent of the development fund. Also need compensation/ remuneration for PO/NGO members29

• Functions of LSBs need to be clearly defi ned

• How to infl uence other areas of the budget. In the Municipal, City and Provincial Development Councils the focus is on 20 percent of the IRA, around 14 percent of the total budget. How can civil society infl uence the allocation of the other 86 percent?

D. The role of civil society in local governance

The Constitution and the Local Government Code have provisions on the concept of the three P’s (Public Private Partnership).

The 1987 Constitution has a separate provision on the roles and rights of People’s Organizations (POs) in public affairs and in local governance. It states that the State shall respect the role of independent POs to enable the people to pursue and protect, within the democratic framework, their legitimate and collective interests and aspirations through peaceful and lawful means.

POs are bona fi de associations of citizens with demonstrated capacity to promote the public interest and with identifi able leadership, membership and structure. The right of 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. Likewise, the Local Government Code of 1991 has similar provisions as those of the Constitution. Sections 34, 35 and 36 of Chapter IV of the Local Government Code, entitled Relations with People and Non-Governmental Organizations states the following provisions: “Local government units shall promote the establishment and operation of POs and NGOs to become active partners in the pursuit of local autonomy (section 34). Local government units may enter into joint ventures and such other cooperative arrangements with POs and NGOs to engage in the delivery of certain basic services, capability-building and livelihood projects and to develop local enterprises designed to improve productivity and income, diversify agriculture, spur rural industrialization, promote ecological balance and enhance the economic and social well-being of the people (section 35). A local government unit may, through its local chief executive and with the concurrence of the sanguine concerned, provide assistance, fi nancial or otherwise to such POs and NGOs for economic, socially-oriented, environmental or cultural projects to be implemented within its territorial jurisdiction (section 36)”.


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Civil societies are represented in various local development councils. Several administrative orders of the central government implementing the constitutional provision and the intention of the Local Government Code regarding public participation in all in general, require that all local councils in all levels should be represented by various NGOs and POs such as farmer cooperatives, fi shermen’s associations etc. Several sectors of society like youth; women, farmers and other special groups have voices in the process of public decision making. A mandatory provision insofar as membership of POs and NGOs in development councils in all levels states is concerned is that they should represent 25 per cent of the total membership of these councils. Local legislative councils do not act local laws like tax ordinances with fi nality unless public hearings are conducted fi rst. The idea of consulting people fi rst before any taxes is adopted by the local legislative bodies is to operationalize the concept of representation by the constituencies through public hearings and consultation before the imposition of proposed local taxes. NGOs and POs are likewise very active in local development activities. These institutions work very closely with local authorities in attaining mutual community interests. Some 16,000 NGOs and POs undergo a process of accreditation that determines the types and classes of NGOs existing in all regions. The process includes the determination of the subjects and ideas NGOs advocate, such as environmental protection, legal issues and rights to development including lobbying efforts to protect/promote specifi c sectoral interests.

Democratization or Debureaucratization?

An active partnership in a joint venture such as capability building is built on the premise that the local government unit concerned, particularly the local chief executive, is open and supportive of such a framework for participation. Although the NGOs maximize

this provision for active partnership and as leverage for gaining recognition, it may be the case that the local government unit sees this relationship in a more pragmatic light as a means of debureaucratization, essentially, privatization, which is also provided for in the Code:

Sec. 3(l) The participation of the private sector in local governance, particularly in the delivery of basic services, shall be encouraged to ensure the viability of local autonomy as an alternative strategy for sustainable development. With this provision, an interesting question is raised as to the purpose of participation. Private sector participation in basic service delivery is very much the new style of public management that stems from decentralization as espoused by the World Bank (World Bank, 1997). This was expressly a concern of USAID in pushing for decentralization in the Philippines (as discussed in Abesamis, 1995: 52, 65).

For others, however, participation is hoped to bring with it much more. Indeed a prime concern of the constitutional provision on participation is the pursuit of democracy. The Supreme Court made a ruling that provisions relating to people’s organizations are about decision-making in the political department, which confi rms people’s participation to be for the purpose of democratization rather than the level of project implementation.

It is important to look where people are participating and ask why? International Finance Institutions (IFIs) and Offi cial Development Assistance are increasingly looking for NGO and PO components to participate in their development projects. There is strong concern that reduction to project level participation may de-politicize participation and co-opt civil society’s democratization goal. While committing time and energy to participate in economic development projects, often ‘band-aid’ for


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prevailing poverty, it is easy to forget that the real roots of the problem, inequitable distribution of political and economic power, still remain unchallenged. (See also White, 1996, on depoliticization of participation.)

At the same time, participation in projects through partnerships with government could also be considered civil society’s backdoor to transforming governance. Since this is one of the venues most utilized by NGOs in an attempt to alter governance at the local level, it is hoped that thorough capability training and even leadership formation civil society can bring in its culture and orientation to the bureaucracy (Villarin, 1996). The opportunities that the LGC provides are not just written in law but it is how the law is interpreted.

Other Non-LGC Mandated Venues for Citizens’ Participation in Governance

Participation in Planning & Implementation of Socialized Housing

Under Republic Act 7279 The Urban Development and Housing Act of 1992, citizens’ participation was recognized as an important aspect of the socialized housing program. Benefi ciaries and the private sector involved in socialized housing are entitled to be heard and consulted and to participate in the decision-making process over matters involving the protection and the promotion of their legitimate collective interest by the LGUs, in coordination with the Presidential Commission for the Urban Poor and other government agencies. They are encouraged to organize cooperative housing and other livelihood activities. Their assistance is to be tapped for the prevention of the incursion of professional squatters or squatting syndicates into their communities.30

Since the mechanisms for operationalizing this provision are not clear, it has been left to

innovative local government units to legislate for participation in the implementation of the socialized housing program as in the case of the Local Housing Boards discussed below.

The Barangay Agrarian Reform Committee (BARC) and Provincial Agrarian Reform Coordinating Committee (PARCCOM)

The social justice mandate of the constitution to redistribute wealth is operationalized through the Comprehensive Agrarian Reform Law, which provides for a Comprehensive Agrarian Reform Program (CARP).31Specifi cally, the Constitution recognized the right of farmers, farmworkers, and landowners, as well as cooperatives and other independent farmers’ organizations to participate in the planning, organization, and management of the program.32

This specifies mechanisms whereby farmers may participate in the planning, implementing and monitoring of the program at the provincial and community level: Provincial Agrarian Reform Coordinating Committee (PARCCOM) and Barangay Agrarian Reform Committee (BARC).33Of the eleven members of the BARC, four should be representatives of farmers and farmworker beneficiaries, farmer organizations, agricultural cooperatives, and NGOs. The tasks of the BARC include identifying qualified beneficiaries and landowners, attesting to accuracy of initial parcellary mapping, mediate, conciliate or arbitrate agrarian reform conflicts.

Experiences in BARC

Peasant representation has allowed some peasant concerns to be heard at the policy level. However, early assessments have shown the majority of the BARCs remain unorganized or are headed by local offi cials and landowners. PO/NGO participation at the local level tends instead to take the form of active partnerships on special projects,


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task forces and NGO or PO-led initiatives (Polestico et al, 1998).

Fisheries and Aquatic Resource Management Council (FARMC)

Republic Act 8550 provides for the establishment of Fisheries and Aquatic Resource Management Councils (FARMCs) at the national, city and municipal level. They shall be formed by fi sherfolk organizations/cooperatives and NGOs in the locality and be assisted by the LGUs and other government entities.34

At the municipal level, the council shall have at least 17 members with at least eleven fi sherfolk representatives seven municipal fi sherfolk, one fi sh worker and three commercial fi shers).35 This mandate of this Council includes assisting in the preparation of the Municipal Fishery Development Plan to be submitted to the Municipal Development Council; recommending the enactment of municipal fi shery ordinances; and assisting in the enforcement of fi shery laws, rules and regulations. A separate fund for these bodies shall be established and administered by the Department from the regular annual budgetary appropriations.36

Mandatory Consultation

The consultation mechanisms that are provided for under Art XIII Sec. 16 are to be facilitated by law but the law is not a pre-condition for the exercise of consultation. This was a concern of one commissioner who felt that ‘by law’ would weaken the provision and restrict the possibilities for POs to engage in dynamic consultations. Others asserted it would be impossible to have adequate consultation mechanisms if they were not operationalized through law.

Under the Local Government Code, it is declared the policy of the State to require all national government agencies and offi ces to conduct periodic consultations with appropriate local government units, non-governmental and people’s

organizations, and other concerned sectors of the community before any project or program is implemented in their respective jurisdictions.37

It is also a duty on the part of the national government agencies or government-owned or controlled corporations authorizing or involved in planning and implementation of any project or program that may cause pollution, climatic change, depletion of non-renewable resources, loss of cropland, rangeland, or forest cover, and extinction of animal or plant species to consult with LGUs, NGOs, and other sectors concerned and explain the goals and objectives of the project or program, its impact upon the people and the community in terms of environmental or ecological balance, and the measures that will be undertaken to prevent or minimize the adverse effects.38

Experience with Mandatory Consultations

• Consultations are not effective and genuine because the process is limited to consultation sessions and does not mandate notices to the public and public hearings.

• National Government projects, including the Country Development Fund (CDF) projects of legislators, have been implemented despite local resistance.

Issues

• Whether government agencies will be required to provide notices and required documents and opportunities for genuine consultation with the people

Trends & Changes in Citizens Participation Frameworks

Trends in Implementing Participation Frameworks


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Based on the experiences of citizens’ participation in mandated venues, key trends have been identifi ed, which may act as helping or hindering factors to the implementation of these legislated participation frameworks. On the whole, implementing the frameworks is diffi cult and there is still resistance from those with political power.

This is evident from the fact that the constitutional provision that is most threatening to those in power, local sectoral representation, has still not been enabled 15 years after the Constitution was ratifi ed. In addition, the Local Government Code and civil society’s role in governance are not fully understood and appreciated by either government offi cials or civil society organizations.

Active Partnerships & Political Will

Where there has been successful citizens’ participation, it is often in the context of active partnerships. In these cases the local chief executive or key councilors are usually perceived by civil society to be ‘open,’ ‘friendly,’ and ‘progressive.’ Even if the local chief executive is not progressive, civil society is still comfortable with a critical collaboration. However, removal of the active partner can lead to the end of a venue for participation. Therefore, the role of an active partnership the local government unit can be said to be an enabling but not necessarily a sustaining factor.

Structures

Much of the legislation provides for specifi c structures, such as committees, councils and special bodies. Some argue that structures reduce the potential for dynamic participation and can be restrictive. On the other hand the presence of structures in which to participate makes institutionalizing participation more

feasible, and without certain parameters to defi ne participation it is likely that no participation will occur. (This assumes that we are talking about a narrow defi nition of participation as defi ned by legislation and not the extent of democratic participation that the Constitution allows.)

To work within structures they should be organized and functional. In many instances, however, this is not the case. For example if, in a particular locality, the Barangay Council is not functional (because there are no regular meetings or active committees for example), it is unreasonable to expect that the Barangay Development Council will be operational. The need then is to organize and provide skills training for both the barangay council and development council.

Resources

A key hindrance to implementing participatory legislation is the lack of resources, human and fi nancial, as has been the case with the Local Development Councils. Similarly, the cost of providing for three extra seats reserved for local sectoral representation is given as one reason the local offi cials will not support the implementation of this provision. In order to organize and maintain structures, resources are also required; the law, however, does not always provide for them.

Quality of Participation and Representation

Many of the venues for participation rely on the participation of ‘representatives,’ usually of NGOs and POs. However, problems regarding the quality of participation and representation consistently reoccur throughout the literature and from discussions with development practitioners. Although laws exist, there can be no guarantee that the participation prescribed in national legislation will be of quality, neither are the checks to consider who is representing whom.


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Representation from the ‘private sector’ may be business, civic organizations or NGOs, all of which have very diverse interests. It is impossible that one will suffi ciently represent the others. There are also NGOs that are set up by local chief executives, and it is uncertain whom the constituents are that they claim to represent.

One area where the issue of quality of participation arises is in Gender And Development (GAD). Women’s representation, particularly at the community level, tends to be reduced to the number of women participating and possibly voicing out opinions and actively planning for the fi rst time, but does not necessarily ensure that gender issues will be represented.

Similarly, indigenous peoples may attend training or consultation but because of existing power relations, it is unlikely that their participation will be meaningful. It appears that the LGC remains inadequate in responding to special governance concerns of peoples with diverse cultures and indigenous governance systems, concerns that the government should consider given that 18 percent of the population may be described as indigenous people.

Some of these concerns over quality of representation may be met if community organizing and the strengthening of POs are prioritized.

Organized Agendas

Although the importance of organizations and their capabilities is considered in the Constitution and local legislation, such as the Empowerment Ordinance of Naga City, national legislation tends to overlook these concerns. For the disempowered to participate effectively, it is essential that they undergo a process of Action-Refl ection-Action on

their situation together, in order to deepen their understanding of their situation, and to consolidate their agenda. They will then be able to negotiate for their specifi c interests in the various venues of participation where multiple and confl icting interests are found. One effective strategy is for sectoral POs to federate at the municipal level so their voice can be heard. This type of network building is also a good strategy for achieving a consolidated civil society agenda, for which civil society can then lobby.

Capability Building

The skills, knowledge and capability of the actors involved will affect the quality of participation. Local government offi cials especially at the barangay and municipal levels require trainings in various areas of local governance and indeed this has been the nature of some joint ventures between LGUs and CSOs. This will help towards improving the functionality of the structures.

Organizational Capacity of POs and NGOs

The capability of POs and NGOs is very important because this affects how the LGUs perceive them. They should be competent in local governance matters and in the training they offer. Many NGOs are experiencing a paradigm shift from ‘expose and oppose’ (confl ict) to ‘compose and propose’ (critical collaboration) and may need more than knowledge on policy formation or local government processes to participate in local governance. Attitude affects the effectiveness of active partnerships.

Accountability check

While the venues for participation are present, they are underutilized in so far as holding the erring LGU offi cials accountable for their actions. For example, with regard to disciplinary actions, the process is often


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subject to political infl uence. One issue is how to utilize the venues to wean citizens away from patronage and demand for a more responsive government. It is when contemplating accountability that one realizes the importance of nurturing responsible and active citizens. If the people will not demand that their offi cials perform well, the offi cials most probably will not.

Local governments can create innovative legislation

Moving beyond national legislation but within the boundaries of the Constitution, some local governments have been exploring their autonomy by enacting innovative ordinances. A strong civil society with a clear agenda and approachable local offi cials are essential if this is to happen. Civil society usually proposes these types of legislation, and therefore, if other areas should follow, a strong and organized civil society is prerequisite.

Changing Legislation

These trends are not new and have altered slightly over time.39 The Local Government Code (LGC) Review was conducted in 1997 with the Department of Interior and Local Government (DILG) – Bureau of Local Government and Development acting as the Secretariat of the Oversight Committee. Working Group, a civil society project, was formed in 1996 to provide a civil society perspective to the LGC review. This was a loose working group with a self-imposed mandate limited to the LGC review process and would act as a vehicle for the NGO-PO community to return to the mainstream of infl uencing policy on local governance, including reviving its participation in the Oversight Committee.

Working Group identifi ed the main challenges to peoples’ participation in governance as being located under the ‘3 i’s’ framework: Implementation, Improvement and Interrelation

(Villarin, 1996: 182; Santos, 1997: 21). It was particularly concerned with ‘improvements’ in the 3 i’s framework, and some of its members40 had already been working on the ‘Empowerment Bill,’ which was designed to broaden and strengthen NGO-PO participation in local governance and address some of the shortcomings of the LGC. During the 10th Congress, the Empowerment Bill was sponsored by Senator Juan Flavier and Representative Florencio ‘Butch’ Abad in the House of Representatives, and when the Congress failed to pass the bill, it was re-fi led by Representative Jubito Plameras during the 11th Congress.41

As a product of the review process, the Leagues of Provinces, Cities and Municipalities in the Philippines together with Working Group signed a Joint Statement on the agreements on the Local Government Code, which sealed a strategic alliance. Points of convergence were on the ‘basic principles of local autonomy and people’s empowerment’ which were essentially decentralization and democratization. Specifi c areas mentioned included devolution, local resources, funds and local taxation, and local boards and special bodies; the issue of local sectoral representation, very much a democratizing provision, was conspicuously absent (Institute of Politics and Governance, 1997: 151-3).

Implementation—As has been seen in the experiences above, implementation is still the main problem of the Local Government Code. There is a need for attitude/skills/knowledge-building among local offi cials and NGOs-POs, including basic literacy and capability building to make good use of the Code.

Improvements—The Code is basically a good legislation and should not be amended wholesale; indeed gains in devolution should be defended. There are, however, some improvements that could be made to address a few problem areas related to democratization. Specifi c amendments would be:


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• Declaration of policy should include democratization and not be left as an implied result of decentralization;

• Mandatory consultations should include all national projects whether or not they cause harm to the environment;

• Working defi nition of NGO and PO to prevent local elected offi cials from heading them;

• Only constituents to initiate recall; and

• Consultations in the budgeting process.

These aspects of the Code have still not been improved, and civil society continues to lobby for their inclusion. The immediate focus of civil society advocacy at this time is to improve participation in the Local Special Bodies and to have an enabling law on Local Sectoral Representation enacted.

Interrelations—The provisions of the Code should be viewed within the context of laws, policies and programs of government that promote people empowerment and sustainable development. These would include laws like the Cooperative Code of the Philippines, The Comprehensive Agrarian Reform Law (R.A.6657), programs like the Social Reform Agenda (SRA), Human & Ecological Security (HES) and Philippine Agenda 21, and the localization of the Philippine Council for Sustainable Development (PCSD), among others.

Conclusions

On paper, legislation for citizens’ participation in the Philippines is very advanced compared to other countries. In implementation there are innovations in legislation and practice made by courageous local officials working in

partnership with civil society. There are many more stories of difficulties due to lack of support (financial and technical), indifference, ignorance of the law, and/or resistance of local officials.

The fact that the laws work when political will allows is, perhaps, a self-evident but important reality. The most telling sign is that the provision most challenging to political power, local sectoral representation, is not yet enabled, whereas participation commonly occurs in the least threatening venues, usually project and program related. This raises questions as to what participation is for. Is it part of a democratizing process or debureaucratizing one? Is the purpose of participation really to ensure that citizens have a voice in ‘all levels of social, political, and economic decision-making’ as intended in the Constitution? Or is it simply to ensure cheaper and more effi cient delivery of services? If the implementation of laws is a question of political will, then one way to improve this would be to ensure that there are sanctions for non-compliance to mandates for citizens’ participation.

Beyond the issue of implementation, we need to look at the quality of participation that is occurring. Measuring quality is important so that we can understand how marginalized groups participate in community affairs. Given that not everyone can participate all of the time, representative participation is clearly more strategic than direct participation, especially if participation is to be sustainable. However, if we rely on representation through well-organized groups, how can we ensure that the views of the unorganized are represented?

Clearly it is the duty of civil society to continue to organize itself, consolidate agendas and maintain a critical


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collaboration with government to advance democratic participation in governance within formal and informal venues. Only a strong, organized citizenry can demand the accountability that participation may offer.

Finally, it should be remembered that no matter how good legislation is, lanes of participation cannot work in isolation; all lanes of the participation highway should be utilized if genuine change is the goal.

- End -

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References:

1. Corruption and Good Governance; Discussion paper 3; Management Development and Governance Division; Bureau for Policy and Programme Support , United Nations Development Programme; New York, July 1997

2. Wikipedia, the free encyclopedia

3. Britannica Concise Encyclopedia

4. Encarta Encyclopedia

5. Corruption and Good Governance; Discussion paper 3; Management Development and Governance Division; Bureau for Policy and Programme Support , United Nations Development Programme; New York, July 1997

6. Good Governance: As if People Matter by Dr. Prakash Louis, Executive Director, Indian Social Institute, This is the revised version of the paper presented in the Workshop organised by International Jesuit Network for Development (IJND) during the World Summit on Sustainable Development at Johannesburg August- September 2002.

7. Decentralization and Local Governance: Reinforcing Democracy and Effectiveness of Local Government; by Tatsuro Niikawa, Professor of Public Administration Theory, Dean of the Graduate School of Policy and Management, Doshisha University; Delivered at Regional Forum on Reinventing Government in Asia, Building Trust in Government: Inovations to Improve Governance; 6-8 September 2006, Seoul, Republic of Korea.

8. Local Governance Capacity-Building for Full-Range Participation: Concepts, Frameworks and Experiences in African Countries; by John-Mary Kauzya; United Nations, DESA Discussion Paper Series; E c o n o m i c & ST/ESA/2003/DP/33, DESA Discussion Paper No. 33, Social Affairs; August 2003

9. Decentralization - Why and How?; by Walter Kälin, Professor for International Public Law at the University of Berne, Switzerland

10. Human Resource Challenges in a Decentralizing State: Some Notes, By Ma. Ernita T. Joaquin


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11. Legislating for Citizens’ Participation in the Philippines; by NINA T. ISZATT, Policy Advocacy Offi cer for KAISAHAN tungo sa Kaunlaran ng Kanayunan at Repormang Pansakahan, a Manila-based NGO working in the fi elds of agrarian reform and local governance.

12. Local government in The Philippines; Government system based on US and Spanish models under review; By Andrew Stevens, Political Editor.

13. Local government in Asia and the Pacifi c; A Comparative Study; Country paper: Philippines

_____________________________________________________________________________________________(Footnotes)1 Refer to Kousar J. Azam (ed). Federalism and Good Governance: Issues Across Cultures. South Asian

Publishers: New Delhi, 1998.

2 Most decentralization policies, programmes and activities in African countries are being conceived within these two planes. The cases of the decentralization policies and programmes in Uganda, Rwanda and South Africa are illustrative of this. See Apolo Nsibambi (Ed.): Decentralization and Civil Society in Uganda: The Quest for Good Governance (Fontana ublishers, Kampala, 1998), and Government of Rwanda, Ministry of Local Government and Social Affairs: Decentralization Policy.

3 See John-Mary Kauzya: “Local Governance, Health and Nutrition for All: Problem Magnitude and Challenges with Examples from Uganda and Rwanda”, a paper presented during the Global Forum on Local Governance and Social Services for All (Stockholm, Sweden, 2 to 5 May 2000). An interesting discussion is presented in the report of the Forum: Responding to Citizens’ Needs: Local Governance and Social Services, UNDESA and UNDP, 2001. A fairly exhaustive survey of literature concerning local governance is presented by Jeni Klugman in “Decentralization: A survey of literature from a Human Development Perspective”, Occasional Papers by the Human Development Report Offi ce, New York 1994.

4 See Peter Abrahams: A Wreath for Udomo, (African Writers Series).

5 We must add that the causes of low participation of grass-root people in Africa is not only a consequence of poverty in terms of income. The whole issue of participative capacity needs to be assessed to include knowledge, skills, institutional arrangements, awareness, opportunity, etc.

6 As an example, the Mombela Local Municipality Integrated Development Plan states the objectives of the participation in the IDP to include: obtaining inputs, ensuring acceptable levels of representation, ensuring mutual consensus, ensuring focus on resource mobilization, and promotion of good governance. There is no objective concerning shifts and increases in consumption of the poor.

7 This idea was discussed by Ejeviome Eloho Otobo in his paper “Globalization, economic governance and African Countries” during the Expert Group Meeting organized by the United Nations Department of Economic and Social Affairs, 28 September 1999.

8 The Community Development Fund in the Decentralization Policy of Rwanda has such an objective. It provides that 10% of the annual revenue of the Government be put in the fund for community development. The


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arrangement minimizes the administrative cost of the funds so that as little as possible of the disbursed funds gets to the local level without being reduced.

9 Adapted from Rural Poverty Report 2001: The Challenge of Ending Rural Poverty. Oxford University Press 2001.

10 Article 82 Title XI, 1899 Malolos Constitution

11 Art. X. Sec. 9

12 See Sec. 446, 457, 467, of Republic Act 7160 and Sec. 93 Rule XVII 1991 IRR-LGC

13 Presidential Declaration 826

14 Go, M. G, Gov’t accused of undermining LGC Manila Times, 4 October 1997

15 DILG Opinions Nos. 67, 86,188-1993; 20-1995; 251-1992

16 DILG Opinions Nos. 103, 340 – 1992; 248-1993

17 R.A. 7160 Sec. 20 (a)

18 R.A. 7160 Sec. 187, DILG Opinion No. 16- 1998

19 R.A. 7160 Sec. 11 (c)

20 LGC Implementing Rules & Regulations Art. 44 (e)

21 R.A. 7160 Sec. 447, 458, 468, See also LGC-IRR Rule XXIII on Local Special Bodies

22 R.A. 7160 Sec. 102-105

23 R.A. 7160 Sec. 116

24 R.A. 7160 Sec. 98 – 101

25 R.A. 7160 Sec. 37

26 R.A. 7160 Sec. 106 – 115

27 R.A. 7160 Sec. 112

28 DILG Memorandum Circular No. 89 Series of 2001

29 Study on People’s Participation in Local Development Councils, presented by Rene Brion, Director, DILG at the 10.10.10. Celebration: CSO Conference on Participatory Local Governance 7-9 October 2001 Traders Hotel Manila


______________________________________________________________________________30 Republic Act 7279, The Urban Development and Housing Act of 1992, Sec. 23-24

31 R.A. 6657 The Comprehensive Agrarian Reform Law (CARL) of 1988

321987 Constitution of the Philippines, Art. XIII Sec. 5

33 R.A. 6657 Sec. 2, Sec. 46, Sec. 47 and also Executive Order 229 Sec. 19, and Department of Agrarian Reform (DAR) Administrative Order No. 5 Series of 1989, DAR Administrative Order No. 14 Series of 1990, DAR Administrative Order No. 1 Series of 1997

34 R.A. 8550 Sec. 69

35 R.A. 8550 Sec. 75

36 R.A. 8550 Sec. 79

37 Republic Act 7160 Sec. 2(c), Sec. 27, Art. 54 (a) Implementing Rules and Regulations

38 Republic Act 7160 Sec. 26, Art. 54 (b) Implementing Rules and Regulations

39 See GOLD Rapid Field Appraisals 1-10

40 KAISAHAN, CONVERGENCE, IPG, PRRM, PhilDHRRA, CSP, CODE-NGO

41 In the 10th Congress the Empowerment Bill was fi led by Senator Juan Flavier (Senate Bill 1348) and by Rep. Florencio ‘Butch’ Abad (House Bill 5636).

local good governance by ramon t. ayco

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