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Local Good Governance

By Ramon T. Ayco
September 2007

I. Introduction

A. What is governance? All actors other than government and the

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 influential landlords,
associations of peasant farmers, cooperatives,
NGOs, research institutes, religious leaders,
finance 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, most common classification of government
etc. may play a role in decision-making or in
influencing the decision-making process.
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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 influence
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 Mafia”
may influence decision-making. In some
rural areas locally powerful families may
make or influence 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
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 which the local governments are designated
is the sign of an inferior government, it is
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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
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 benefit of the people
rather than exclusively for his or her own
benefit.
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 All forms of government are susceptible to
and holocaust that kills thousands of people. corruption, or political corruption to be exact.
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Local Good Governance
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 officials and the
provision of benefits to the corrupt.
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While corruption may facilitate criminal
enterprise such as drug trafficking 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 officials.
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 influence
or be influenced by another for personal gain, Sunni Arabs in Saddam Hussein’s Iraq, the
which is often difficult to prove, graft only
requires that the official gains something
of value, not part of his official 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 Office of the friends (cronyism). This may be combined
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 significant profit. This is comparable to
insider trading in business.
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• Extortion and robbery
While bribes may be demanded in order to do
something, payment may also be demanded
by corrupt officials who otherwise threaten to
make illegitimate use of state force in order
to inflict 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 officials
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
officials are often selected for loyalty rather
than ability. They may be almost exclusively
selected from a particular group (for example,
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
with bribery, for example demanding that
a business should employ a relative of an
official 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 official’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 benefits, and in exchange
for betraying the public, the official 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 (inflated) 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
officials; 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 officials have
broad or not well defined powers, and the
line between what is legal and illegal can be
difficult 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 benefits are distributed on
the basis of ability to pay, the poor
will suffer. Using an illegal price
system to distribute pensions, public • The poor are disadvantaged in
housing, education and health will
disadvantage those unable to pay.
This is true for legal user fees, and
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Local Good Governance
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, officials 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 benefit the worst off. Even
projects such as the building of
schools or health clinics will provide
fewer benefits to the poor if their
costs are inflated 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
find 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.
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 officials
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 firm,
where the basic terms have been set without
regard for the possibility of corruption. Then
the bribe represents a transfer from the profits
of the winner and the government treasury to
the pockets of the official. Unless the bribe
comes entirely from the winner’s profits, 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 indicate a government that governs well, but
overall impact of such a method of campaign
finance could, however, be harmful to voters if
elected politicians then favor inefficient projects growing crisis of governability. It indicates that the
appealing to major donors. The poor may
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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 defines 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
an increase in politically oriented violence in a
more or less open polity nearly always indicates a
state does not possess the institutions necessary
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for peaceful resolution of the society’s normal into consideration in decision making.
political conflict. Participation needs to be informed
and organized. This means freedom
A developing country, which is democratic in of association and expression on
its polity, is well governed if its government the one hand and an organized civil
can simultaneously sustain legitimacy, promote society on the other hand.
socio-economic order and maintain order without
coercion. In sum, good governance refers to 2. Rule of law
non-partisan and active legislative bodies,
independent judiciary, free print and electronic Good governance requires fair
media, constitutionally guaranteed system of legal frameworks that are enforced
decentralization and devolution of power to impartially. It also requires full
all levels of governance, direct democratic protection of human rights,
accountability at the local levels, and a vibrant particularly those of minorities.
and vigilant civil society. In good governance Impartial enforcement of laws
the common masses are the central focus of all requires an independent judiciary
development, their political participation is ensured. and an impartial and incorruptible
police force.
One way of measuring good governance is to set
up standards whereby some objective definition 3. Transparency
of a society’s problems would be sought and
against which the capacity of a government to Transparency means that decisions
solve problems would be assessed. By that, we can taken and their enforcement are
measure good governance by a set of eight (8) major done in a manner that follows rules
characteristics: participatory, consensus oriented, and regulations. It also means that
accountable, transparent, responsive, effective and information is freely available and
efficient, equitable and inclusive and follows the rule directly accessible to those who
of law. Good governance is a subset of governance will be affected by such decisions
wherein public resources and problems are managed
efficiently. It assures that corruption is minimized, 5. Consensus oriented
the views of minorities are taken into account and
There are several actors and as many
that the voices of the most vulnerable in society are
view points in a given society. Good
heard in decision-making. It is also responsive to the
present and future needs of society. governance requires mediation of
the different interests in society to
1. Participation reach a broad consensus in society
on what is in the best interest of the
Participation by both men and whole community and how this can
women is a key cornerstone of be achieved. It also requires a broad
good governance. Participation and long-term perspective on what
could be either direct or through is needed for sustainable human
legitimate intermediate institutions development and how to achieve the
or representatives. It is important goals of such development. This can
to point out that representative only result from an understanding
democracy does not necessarily of the historical, cultural and social
mean that the concerns of the most contexts of a given society or
vulnerable in society would be taken 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 efficiency
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 efficiency 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.
Diagram 2: Characteristics of good governance
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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, financial
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.
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It also means that enough governance—”the processes and institutions
information is provided and through which citizens and groups exercise
that it is provided in easily their legal rights, meet their obligations and
understandable forms and media. mediate their differences”.

4. Responsiveness Decentralization does not only mean the

dispersion of functions or the delegation of
Good governance requires that power from center to local, which means the
institutions and processes try to functional division between center and field
serve all stakeholders within a office within the central government. More
reasonable timeframe. than that, decentralization is the devolution
of power, the shift of authority from central
Good governance defines an ideal which is government to local government, which goes
difficult to achieve in its totality. Very few with the reallocation of tax resources between
countries and societies have come close to central and local government usually.
achieving good governance in its totality.
However, to ensure sustainable human In this sense, the decentralization requires
development, actions must be taken to work the reform of central-local government
towards this ideal with the aim of making it a relationship and the autonomy of local
reality. Good governance is ensuring a better government. As the local government and
today and a brighter future for all the citizens. local community achieve their autonomy
and self-help, they can activate local
resources successfully in order to pursuit
II. Decentralization the economic development of region or
locality.
First of all, before we can established a local
good governance, local governments must As each country has its own local government
first have real power. As we have said above, system, the decentralization reform in practice
the majority of governments in the world are is various. For instance, decentralization has
centralized. In order for local governments to different meanings between the countries
have real power we have to go on a process of which have only municipal levels of local
decentralization. government and those with regional and
local levels of local government. The French
A. Meaning of Decentralization decentralization reform in 1980s has been
characterized in the regional and department
In response to the many failings of centralized level reform. In French case, the focus of
government, decentralization has become decentralization was on the devolution and
a world-wide trend. Towns and other liberalization of department. It was the same
local governments in rural areas are being in Japanese decentralization.
strengthened in a growing number of countries
in all continents. The characteristics of decentralization
are much different whether the level of
Decentralization refers to the process of decentralized local government is municipal
moving towards decentralized governance—in or regional. Also, there are many differences
which economic, political and administrative whether the local government system is a
power, authority and resources are single-layer or multi-layer. In the multi-
transferred from the centre to lower levels of layer system, we have to take account of the
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regional-municipal government relationship functions and resources, thus enabling local
and the decentralization from regional to governments to perform fully, horizontal
municipal. decentralization may take place without
necessarily making adjustments in the laws.
In any case, the municipal or community level However, horizontal decentralization requires
decentralization is likely to empower the municipal determined mobilization and organization
level government. In general, the municipal of local communities to participate fully
government is the most near to local people. in the planning and implementation of
This means that the municipal government has socio-economic activities that are aimed at
a key role as a base of local governance and its strengthening their capacities to determine and
empowerment is critical to the local people who enjoy their socio-economic livelihood.
participate in the local governance.
An important linkage between vertical and
In the case of regional level decentralization, horizontal decentralization is that in countries
the reconstruction and liberalization are used to highly centralized governments and/
implemented, because the regional level or dictatorships, horizontal decentralization
government has been an agency of central empowers local populations and prepares them
government or under the strict control of to be able to positively receive and utilize the
central government. The decentralization powers, authority, and resources transferred
and empowerment of regional government to them via vertical decentralization. It is
are usually to achieve the regional economic very useful to always engineer efforts of
development and the capacity building to decentralization on the two planes involving
support and assist the municipality. all stakeholders. As illustrated in the diagram
below, this will achieve two crucial results:
Vertical and horizontal decentralization for
effective local governance2 • horizontal decentralization will
empower local communities; and
For effective local governance, decentralization
policies, strategies, legal frameworks, programs • vertical decentralization will create
and activities must be conceived from two planes: conducive structural arrangements
and transfer of powers, functions,
• The vertical plane, involving the responsibilities and resources that
transfer of authority, functions, will supplement the empowerment
responsibilities and resources created by vertical decentralization.
from central government to local
government structures; and Conceiving the two planes of
decentralization is also useful in situations
• The horizontal plane, involving the where the debate and agreement on formal
empowerment of grass-root munities vertical decentralization involving the
to enable them to determine, plan, transfer of powers, authority, functions,
manage and implement their socio- and resources from central government to
politico-economic development. local governments for various reasons takes
longer than needed. In such cases, it is
While vertical decentralization requires shifts possible and advisable to start establishing
in central government policy, laws as well as programmes, projects and activities that
institutional and structural arrangements to empower local communities via, for
provide for the sharing of powers, authority, example, community-based organizations
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(CBOs) and non-governmental organizations Instead, it is the local level of government

(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 significantly 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
inefficient use of available resources and the
inherent difficulties 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 be transmitted to a central planning board.
problems the citizen faces every day.
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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 specific requirements of
the community needing assistance.
Officials who work for centralized
governments do not have the necessary
knowledge of local conditions to provide
efficient government services because this
knowledge is dispersed among the millions
of people who comprise society, and cannot
Even the best organized central administration
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is unable to really determine whether, in a
specific 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 officials 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 historically, the local government and local
public school, public hospital, or public bank, people have had the long experience of local
citizens begin to look for private schools,
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private hospitals, and even private security
firms. 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 first is the dysfunction of centralized
decision 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 inefficient resource
consumption. The centralized resource
allocation system, for instance the tax resource
allocation system, has failed in the efficient
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 finances 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
maturity of local government system and
local citizenship. In each country, as we
have the long traditions of local government
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 significant 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 officials 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 benefit both levels of government
and the citizens simultaneously.
C. Conditions for successful
decentralization
How can the goal of empowering local
governments to act as efficient 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 first 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
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Local Good Governance
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 specific, 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 sufficient 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 sufficient aqnd well-qualified
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 office-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 efficient
administration. Only well-defined
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 financial matters. Supervising
authorities should exercise a tight
control but such control should have
a retrospective (ex post) character
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page 14
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 to
the local level.
Finally, structures should be created
which will facilitate a dialogue
between the different levels of
government. In many countries,
Local Good Governance
______________________________________________________________________________
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 the local populations. Some local governments can
determining the direction according to their
local needs, problems, and priorities and the
3
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Local Good Governance
level to which they are the beneficiaries 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 conflicting 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
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 fulfilled. With regards to this, among the
most important reasons for us to give more
authority to lower levels of government are:
the greater efficiency 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. Efficient and accountable
administration
The desire for a more efficient
administration has motivated many of
the recent constitutional and legislative authority when the citizens know
changes in countries all over the world.
However, experience has shown that
central governments are often unable
to successfully implement efficiency-
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 at higher levels of government, as
governments are properly equipped
to fulfill their tasks, the chances for
achieving “better government” through
decentralization increase.
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page 16
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 difficult
to hide corruption among those in
the officials 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
officials and elected office-bearers
accountable for their actions than it is
to impose accountability on politicians
members of local governments are
often less protected politically than the
corresponding official 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 efficiently if
responsibility for each type of public
expenditure is given to the level
of government that most closely
represents the beneficiaries 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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Local Good Governance page 17
______________________________________________________________________________
Beneficiaries 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 financial
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 influence 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
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page 18
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 specific and extended
expression of the basic constitutional
principle of the separation of powers.
Moreover, decentralization allows, to
a certain extent, for a specific 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 office
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 conflict within the
national political arena is reduced”. 2. The network governance is composed
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
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Local Good Governance
into effect efficiently. As more democratic
and efficient localities are needed, there
must be the development and reform of local
government and local people. The local
government’s reform by itself is difficult
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 first 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 efficient 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.
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
page 19
______________________________________________________________________________
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
efficient 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 efficient use of local
resources through this cooperation.
The governance partnership will
keep and secure the sustainability of
community.
Local Government Reform
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.

Toward local good governance, the local B. Local Governance Capacity-

government and local people have to change Building
themselves. The local government is a most
important actor in the community life and has There is often a debate on whether
to be reformed for new local governance. decentralized governance policies should wait
for local capacity to be adequate before they
Attaining a good governance of local are put in place. This debate is not necessarily
government itself, there must be capacity misplaced but it often misses the point of
building of local government, which includes answering the question as to who are the actors
the local government reform, the increase of in local governance and therefore whose and
organizational capability of good decision which capacities should be developed.
making and service provision, the stable and
good financial condition of local government Should we wait for local governance
and community, and the capacity building of capacity to develop?
local public personnel.
The argument commonly presented is
The local government reform is usually that local people do not have the requisite
adopting the following measures; cost capacity for managing local governments,
cutting, restructuring and re-engineering, and therefore functions, responsibilities and
privatization and outsourcing, and resources should not be devolved to them.
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page 20 Local Good Governance
______________________________________________________________________________
In most cases, such an argument stands in policy that provides for, among other things,
the way of decentralization. Admittedly, it is building local governance capacity. How would
true that most developing countries present the capacity of a local council, a local executive
peculiar conditions of multiple weaknesses committee, a local community development non-
in capacity where their public sector, civil governmental organization, a local development
society, and private sector are weak. However, planning committee, etc. develop if such structures
within the argument of capacity-building for were not constituted in the first place?
local governance are carried undertones of
colonialism. Since the process of development Whose capacity to develop for local
is a process of capacity-building, a country governance?
cannot afford to wait for the local governance
capacity to develop. In addressing issues related to capacity-
building for local governance, the tendency
During the 1950s, for example, when Africa is to focus on local government structures
started clamoring for political emancipation, such as local government councils, civil
the colonial powers at the time were quick servants, local government executive
to respond that Africans had no capacity to committees, etc. However, taking the
govern themselves. The response from Africa understanding of local governance we have
was unanimous. Capacity or no capacity, they adopted, this would be inadequate, for it
had a right to determine their destiny. “By leaves many players in local governance out
what God-given right are you, the British, of capacity-building efforts. The appropriate
empowered to decide the fitness or otherwise way to address the issues and problems of
of we Africans to govern ourselves?” one of capacity-building for local governance is to
the characters in the famous novel A Wreath first conduct the identification and analysis
for Udomo by Peter Abrahams4 asked. of the stakeholders and key players. This
would enable us first to know who they are,
It should not be for the same African leaders and second to understand what capacities
who posed this question to reject decentralized they possess as well as what capacities they
local governance telling their compatriots that lack. We would propose a stakeholders
they lack the capacity to govern themselves. analysis model that departs from a simple
This would be local colonialism. Development question. Who are the stakeholders and key
is a process of progressive and qualitative players in local governance? The diagram
movement from inability to ability, from below gives a simple framework for the
incapacity to capacity. Therefore, it is analysis of local governance actors.
conceptually normal to start from a point of
weak local governance capacity and work When it comes to local governance, there
towards strong local governance capacity. are many stakeholders and players. They are
Without this pre-disposition, decentralized in the public sector, in the private sector, in
governance in most developing countries may civil society, among donors and development
never be embarked on. partners, and at the local community, national,
regional and international levels. The capacity,
We could use an analogy of building the capacity or lack of it, for local governance cannot
of a soccer team. It is impossible to build the and should not be pinned only on the local
capacity of a team if the team is not constituted community in question. The appropriate
in the first place. It is impossible to build the predisposition for capacity-building for local
capacity of local governments if local governance governance is to assess each player’s capacity
structures are not put in place within a clear vis-à-vis their roles so that each one’s capacity
______________________________________________________________________________
Local Good Governance page 21
______________________________________________________________________________

is strengthened to play that role effectively. problem found among almost all players
For example: involved in decentralized governance. The
difference is in the extent and degree to which
• While in many countries central the capacity is lacking.
government authorities hesitate to
embark on decentralized governance In the context of an increasingly globalizing
policies for reasons related to world, the challenges and requirements
inadequate capacity at the local level, of capacity-building for local governance
it has been discovered that the same should always be analyzed and diagnosed,
central governments do not possess taking into account the full range of
the adequate capacity to analyze, stakeholders’ and actors’ analysis at the
formulate, and effectively manage community, local, national, regional and
decentralized governance policies. 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
• While many donors and common understanding of one another’s
development partners have strengths and weaknesses. This would in
a tendency of blaming local turn facilitate the process of cooperation,
governments of having no harmonization, and synergy in capacity-
capacities to implement local-level building activities. The framework given in
development projects, it is often the diagram below was used to conduct a
the case that the same donors and governance capacity assessment in Uganda,
development partners do not have Rwanda, Liberia, and Tanzania, and was
the requisite capacity in terms of found to be very useful.
understanding and working within
the local community’s cultural and Local governance capacity-building for full-
social environments to promote range participation (Four Ps +C)
community sensitive development.
We have belabored the point on local
The real situation in many developing governance as an all-actors-embracing
countries is that inadequate capacity is a situation, because experience has shown that
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page 22 Local Good Governance
______________________________________________________________________________

in most cases local governance capacity- extent and nature of the participation itself
building programs, projects and activities needs to be understood more deeply.
concentrate on local governments. We need
to maintain the distinction between local We are proposing to examine it using the 4
governments’ capacity-building, which would Ps plus C of participation. If participation
concentrate on local governments, and local has to be complete, it must be done at five
governance capacity-building, which would levels: Priority setting, Planning, Producing,
emphasize strengthening the capacities of all Paying (financing) and Consumption. It is
the actors in governance at the local level. the consumption that leads to livelihood,
This would set the appropriate parameters but when it is not supported by participation
for effective participation in the development in setting priorities, planning, production
process by all actors. and paying, then it is not sustainable. The
biggest problem for developing countries
Diagram 5: Grass-roots local governance
stakeholders and actors analysis framework is that because of very low or sometimes
no income, people expect to participate
Participation is not a matter of only structural in consumption without participating
arrangements. It is also a matter of will and in paying. This makes consumption
capacity. Most advocates of local governance unsustainable because there is no support
as a vehicle for promoting socio-politico- for production5.
economic development always bank very
strongly on the argument that decentralization On the other hand, often those in positions
encourages participation of the local people in of authority concentrate on promoting the
determining their development and well-being. participation of local people in the four Ps,
However, in the context of poor countries, the but they do not provide for participation in
______________________________________________________________________________
Local Good Governance page 23
______________________________________________________________________________

consumption. The consequence is that the on its part gets money from taxes paid by the
poor do not see any change in their livelihood people; but however efficient and effective a
even when they have participated.6 It should tax system is, if it is taxing a poor population,
be noted that for purposes of mobilizing the local it will yield poor revenues. There is a limit
people to participate, an objective that points to beyond which a hungry person can milk a
the possible improvement in their consumption is hungry cow. The fundamental problem with
more attractive than any other and therefore worth most developing countries is that they suffer
mentioning. from a double weakness: their central and
local governments are weak while at the same
Local governance, when well practiced, more time their private and civil society sectors are
easily and more evidently encourages political also weak (vertical and horizontal weakness).
participation (e.g., in taking decisions and having This double weakness is not only in terms of
a say in who takes up leadership positions), resources (human, material and financial),
production and delivery by narrowing the physical it is also in terms of institutions, systems,
distance between the service producers/deliverers information, networking, skills, knowledge,
and consumers as well as by allowing the private etc.
sector and NGOs to engage in service production
and provision. Conceptually, all countries could be placed
in four categories as follows: the strong ones
However, it has to be recognized that when where the central and local governments
it comes to participation in financing the as well as the civil society and the private
production and provision of these services, sector are all strong A); the partly strong ones
the poor are at a loss. The challenge for where the central and local governments are
developing countries, given their situation of strong but with a relatively weak civil society
extremely low incomes, is how to encourage and private sector (B); the partly weak ones
the poor to participate in financing the services where the central and local governments are
they need. Most poor populations are quick to weak but the civil society and private sector
advocate for participation but when it reaches are relatively strong (C); and the weak ones
the level of participating in the financing they where the central and local governments
still want some donor or central government are weak as well as the civil society and the
to foot the whole bill. The central government private sector (D). Most sub-Saharan African
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page 24 Local Good Governance
______________________________________________________________________________
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 financial
capacity of local governance should not be lost.
Local governance financing 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 finance
deployment policies of all actors as well. There
are many financing 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.
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 beneficiaries 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 specific 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
reflect the critical role of food security.
We have to go further and call for food
sovereignty.

A local governance policy that is conceived 3. Increased growth alone will not lead to
with capacity-building in mind should alleviation of poverty. How this growth
include provisions for financing systems is redistributed to all the segment of
that would put funds at the disposal of the the population is the crucial aspect.
local level so that such funds not only cater
to the needs of local communities but also 4. The most disadvantaged and
provide opportunities for them to develop vulnerable groups should get the
revenue generation and financial management priority in terms of poverty alleviation
capacity.8 programs. Often times these are the
people who are real producers, but do
C. Development Work in not have access to what they produce.
Decentralized Governance
5. Partnership and participation is the
For community based development, good strategy that would ensure the overall
governance becomes very important and efforts to reduce poverty.9
______________________________________________________________________________
Local Good Governance page 25
______________________________________________________________________________

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
______________________________________________________________________________
page 26
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 specific
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 difficult to collect, and if
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______________________________________________________________________________
collected are often insufficient to fulfill agents of the central government, and
the tasks assigned to them. Access therefore rejects their authority as
to central funds may be limited and representatives of the community’s
difficult. interests.

In addition, local authorities often • Lack of transparency and

lack qualified and well-trained staff accountability. Corruption at the local
and therefore are unable to perform level is a problem in some countries.
properly even if money is available. It is more likely to take place where
Lack of resources takes on dramatic there is a lack of transparency and
forms if local governments are accountability. This is due to the fact
granted large powers that have been that corruption is difficult to prove
shifted from the center. In these when government accounts are not
areas, governmental activities may accessible to the population and/or
stop entirely and the center will be when there is no legislation that
able to blame the local levels for clarifies the powers and duties of the
such failure. different bodies involved in local
governance issues. If local officials are
• Lack of or overlapping powers. accountable to several authorities, this
Sometimes the powers of local will create confusion and insecurity
governments are too limited to at the lower level and thus hamper
respond to the expectations of the efficient administration even more. In
population. More often, however, local addition, accountability is lessened
governments possess broad powers, when local office-bearers are appointed
but central government offices are also rather than elected, because
competent to carry out such activities there is then little chance that even
at the regional or local level. This proven instances of corruption will be
leads to an unclear delimitation of remedied.
powers and overlapping of activities.
The result is that problems do not get Excessive control. A typical problem in
•
solved at either level, and the people many countries is that the higher levels
lose faith in both their local authorities
of government (provincial or central)
and the central government. must approve the budget before the
local government can spend anything.
• Lack of democratically elected local The approval is often delayed and
authorities. In some countries, local the process is often used to impose
authorities are not elected by the many conditions on the proposal’s
citizens, but are instead appointed by acceptance. The same is true for the
the central government leadership. In required approval of contracts. In some
other countries, elected bodies have countries, planning procedures are very
been dissolved or local elections have complicated and slow, leaving local
not taken place for a long time. In authorities no opportunity to decide
these cases, government -appointed where to set priorities. Often, local
administrators have taken over the governments must get prior approval
daily business of governing. In any of for all expenditures above a certain
these cases, the local population may (usually minimal) level. Finally, a
perceive the local officials as merely very effective control can be exercised
______________________________________________________________________________
Local Good Governance page 27
______________________________________________________________________________
through threats to dismiss the local without reducing any services, reelection is
body for not performing “properly” guaranteed.
(i.e., according to the wishes of the
center). Such control mechanisms Thus, the ideal Swiss mayor is more like a
ensure that local authorities are manager running a business than a typical
constantly supervised by the central politician: service- (and thus development-)
government officials. This not only oriented. A study by Edward C. Page has shown
slows the progress of local activities, it that Scandinavian and British mayors and their
cripples local initiative. municipalities are as service- and development-
oriented as their Swiss colleagues.
Lessons from Europe
In other parts of Europe, local governments
It is sometimes feared that strong local are seen as supporters of the central
governments will abuse their powers and use government. Many mayors in countries
their position to gain more power rather than such as Italy, Spain, or France undertake
to foster local development. Comparative fewer initiatives for their municipalities as
studies carried out in Europe are of interest service-providers. These mayors primarily see
in this context because they reveal a strong themselves as politicians, and act accordingly.
relationship between the degree of autonomy The party politics from the central government
and resources of a municipality and the extends to the local levels and affect the
attitudes and behavior of its mayor. lives of the citizens much more directly than
in Switzerland or Scandinavia. Success is
Different roles of local governments not “evaluated primarily in terms of the use
and allocation of local resources” but rather
In some parts of Europe, the prevailing view in terms of the official’s “ability to bring in
of the role of local government is that it benefits from the outside”.
should primarily be the providers of services
and agents of development at the local level. As described by one author, these mayors
Local leaders should focus on responding are primarily ‘policy-brokers’, i.e., persons
to the needs of the population concerning “negotiating, bargaining or otherwise
practical matters such as maintaining local attracting scarce resources”. A mayor’s
roads, collecting solid waste, or taking care of ability to succeed thus depends on developing
the sewage system. personal connections to politicians at the
national level and on being able to offer
One author recently stated that in Switzerland, benefits to the central officers in return for
especially in smaller municipalities, political receiving their resources.
parties play a rather unimportant role in
local politics. The mayor has to run an The benefits the local government official can
administration providing services in areas offer the central government, put very simply,
such as education, water, sanitation, local are votes for the party in national elections.
roads, and public assistance to the poor and Thus, the local mayor is the representative
unemployed. of the party at the local level who must make
sure that the majority of the citizens in the
The mayor will be reelected if these services municipality will vote for the party. To make
are well provided without overspending. If sure that this will happen, the mayor can offer
the mayor succeeds in presenting a budget local supporters favors (for example, jobs or
that allows for lowering the local taxes benefits from projects). This type of mayor
______________________________________________________________________________
page 28 Local Good Governance
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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 officially
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 • In contrast, the municipal governments
of local governments in these countries:
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Local Good Governance
• 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 the
central 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
finance 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 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 offices
of the central government. This
supervision is very intrusive to the
activities of the local officials, 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 widespread but petty, flourished.
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page 30
their organs. A low degree of administrative
control is also a significant 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 benefit. Pre-
colonial Philippines was decentralized and
characterized by the barangay: a politically,
socially, and economically independent village
that was generally self-contained and self
sufficient 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
office was monopolized by a small group
of “bosses” in each community. Venality,
Local Good Governance
______________________________________________________________________________
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 officials, 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 efficiency 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 influence 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.
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Local Good Governance
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 benefits 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 officials 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 benefited,
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
page 31
______________________________________________________________________________
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 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.

The turning point came in 1986 when one Concessions were made to the anti-
million Filipinos from different walks dictatorship movement without creating a
of life converged on a major highway, significant threat to the old social order, so
Epifanio De Los Santos Avenue (EDSA), to the progressive agenda such as social justice,
assert what has become their own brand of human rights and participation principles
political participation—‘people power.’ After were included. Decentralization, however,
deposed President Marcos fled the country, was also written into the Constitution,
Cory Aquino assumed the Presidency with which was a significant change to previous
corresponding emergency powers. Aquilino forms of government. Indeed there was
Pimentel, author of the Local Government a widespread association of centralized
Code, was chosen as Secretary of Local government with Marcos-era authoritarianism
Government and tasked with appointing and the concurrent presumption that high
officers-in-charge (OICs) in all the provinces levels of decentralization essentially favored
who would be supportive of President democracy.
Aquino.
B. Decentralization in the Philippines
This was a crucial time in Philippine history
because President Aquino was presented In addition to adopting a system with a
with the opportunity to actualize real change. bicameral legislature and president, the
The popular movement that had kicked out 1987 Constitution also provided for the
Marcos comprised a broad spectrum of the decentralization of the administrative system
population: from the national democrats on as discussed above. The Constitution—in
the left who had been fighting the dictatorship Article Ten, Section 3—called for the
since the seventies, to the country’s elite who enactment of a law on local autonomy and
had turned against Marcos in the final hours to decentralization:
protect their own interests.
“The Congress shall enact a local
It is very tempting to say that coming government code which shall provide
out of martial law was the start of re- for a more responsive and accountable
democratization. Some schools of thought local government structure instituted
would, however, question this. Although the through a system of decentralization
progressive forces on the left had been the with effective mechanisms of recall,
linchpin of the anti-dictatorship movement, as initiative, and referendum.”
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page 32 Local Good Governance
______________________________________________________________________________
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 definition 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,
field offices 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 efficiency (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
officials 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)
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Local Good Governance
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-qualification, 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, efficient, 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 efficient
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
staffing pattern taking into
consideration its service
requirements and financial
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 influence of politics in selection.
Essentially, decentralization brings the
government closer to the influence of
______________________________________________________________________________
page 34
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
Local Good Governance
______________________________________________________________________________
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 ex-officio representation for barangay and
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 Local Government and grouped into 17
forms the municipal council. All are elected to regions for administrative purposes at
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
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Local Good Governance
as belonging to the same sub-tier as the
municipalities but are given more central
government subsidy to fulfill 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 classification groups for purposes of self-
government - chartered cities and component
cities. Chartered cities, which include a
number regarded as Highly Urbanized Cities,
are accorded significant 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
youth council provincial presidents. The
provinces are given presidential oversight
through the Department of Interior and
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
page 35
______________________________________________________________________________
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:
• Efficient 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) define the functions and
powers of the different local authorities. The
provisions are standard and descriptive of the
functions and powers of local government
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page 36
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 efficient 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 fine not exceeding five
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
fishing and other forms of
destructive fishing, illegal
logging and smuggling of logs,
smuggling of natural resource
products and of endangered
species of flora 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 officials and employees of the
province;
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Local Good Governance
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 qualified person
not in the government service who
fills up a temporary vacancy, or
grant honorarium to any qualified
official or employee designated
to fill 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 finances of the
government allow, provide for
additional allowances and other
benefits to judges, prosecutors,
public elementary and high
school teachers and other
national government officials
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 specific 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 specific 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 floating of
bonds or other instruments of
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page 38
indebtedness, for the purpose
of raising funds to finance
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 fix the license fees
for such activities as provided for
under this code;
4. Approve ordinances which shall ensure
the efficient 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, fix reasonable
tuition fees and other school
charges in educational
institutions supported by the
provincial government;
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Local Good Governance
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 beneficial 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”.
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 officers 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 fiscal relations
Fiscal relations between national and local
government centre on the following major
areas of fiscal administration:
• Allotment of internal revenue shares;

Functions of local governments or their so- • Shares of local governments in national

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 fishing
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 beneficial to them
in accordance with law.” The functional
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page 40
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 benefits (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
fiscal year from mining taxes, royalties,
forestry and fishery charges, other taxes,
fees, or charges, including related surcharges,
interests or fines 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 fiscal 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 fishery charges and such other
taxes, fees or charges, including related
surcharges, interests, or fines the government
agency or government-owned or controlled
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Local Good Governance
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 finance
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 fiscal 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 offices (Section 350 K).
Local taxes
Local government taxation and other fiscal
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 financing 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;
page 41
______________________________________________________________________________
• Franchise tax; Cities:

• Sand and gravel tax; • The city may levy and collect among
others any of the taxes, fees and
• Professional tax; other impositions that the province or
municipality may levy and collect.
• Amusement tax on admission; and
Barangays:
• Annual fixed tax per delivery truck or
van of manufacturers or producers of or • Taxes and fees;
dealers in certain products.
• Service charges; and
Municipalities:
• Contributions
• Tax on business;
A comparison of the income profiles of local
• Fees and charges; governments for the year 1992 (first year of
Local Government Code implementation) and
• Fishery rental or fees and charges; year 1994 showed a decrease in income from
local sources and an increase in national aid
• Fees for sealing and licensing of weights and allotments. In 1992 the income from local
and measures; and sources represented 42.76 per cent of total and
non-tax revenues 15.99 per cent). During the
• Community tax. same year aid and allotments from the

Table 1. Comparative Local Government Income Profiles

1992-1995 (in million Pesos)

Income category 1992 Profile 1995 Profile

Income 27,703.5 100.00% 77,006.9 100.00%

Local taxes 11,846.6 42.76% 22,976.9 29.84%
Taxes 7,416.7 26.77% 14,904.1 19.35%
Real property taxes 3,922.9 14.16% 7,932.1 10.30%
Business taxes 3,493.8 12.61% 6,972.0 9.05%
Non-taxes 4,429.9 15.99% 8,072.8 10.48%
Fees/charges 855.3 3.09% 1,879.5 2.44%
Economic 1,485.8 5.36% 2,286.1 2.97%
enterprises 392.9 1.42% 1,408.9 1.83%
Loans/borrowing 1,695.9 6.12% 2,498.3 3.24%
Others 15,856.9 57.24% 54,030.0 70.16%
Allotment and aids 15,473.2 55.85% 51,925.0 67.43%
Internal revenue 383.7 1.39% 2,105.0 2.73%
allotment
Aids

Source: Department of Finance

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page 42 Local Good Governance
______________________________________________________________________________
national government represented 57.24 per properties decreased from 14.16 per cent to
cent of the total local revenues, which came 10.30 per cent. This can be attributed to the
local revenues (taxation 26.77 per cent from codal provision that broadens tax exemptions
statutory allotments or internal revenue for real properties. Residential properties
allotments. However, income from local with market value of 175,000 Pesos and
sources represented only 29.84 per cent of below were exempted from payment of taxes.
the total income in 1995, a decrease of 30 This codal provision significantly eroded the
per cent from the 1992 level. Taxes from real 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)

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Local Good Governance page 43
______________________________________________________________________________
Table 4. Growth Rates of Local Government Units (1991-1995)

Growth rates (percentage)

Source 1991-1992 1992-1993 1993-1994 1994-1995 Average
Revenue from 14.86 38.57 18.34 18.43 22.55
taxation
Real 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 -4.34 21.98 23.52 -3.53 9.41
economic
enterprises
Fees/charges 17.17 64.48 13.22 15.94 27.70
Loans and 234.77 37.52 -33.06 79.74
borrowing
Other 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 significant 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)
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 financial
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 fiscal
federalism.
Specific revenue sharing

The growth rate of local revenue sources during Some programmes and projects for
1992-1995 indicated an erratic performance LGUs are based on certain specific grant
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page 44 Local Good Governance
______________________________________________________________________________
criteria/formula such as urban population, Development Project (MDP) providing local
incidence of poverty, population growth authorities with loans and grants on a 70 to 30
rate, annual average income, degree of urban per cent ratio respectively in order to address
environmental degradation, deficiencies municipal infrastructure requirements.
in basic services such as sanitation and
waste water disposal, storm drainage and In the social sector, some education and
flood prevention, solid waste collection and health projects of LGUs are also provided
disposal, roads/traffic, water supply, public with central government grants based on their
markets, slaughterhouses, bus terminals, etc. needs. Besides selected LGUs are required
to put-up equity for the project to ensure
Table 5. IRA Percentages of Provinces in
goal congruence between national and local
Relation to Total IRA authorities. A similar financing scheme is
also used in the case of environmental and
NCR 8.95 agricultural projects that fall within the
Region I 34.06 ambitions of the national government social
Region II 38.67 reform agenda. LGUs are provided fund
Region III 33.81 support based on differentiated schedules of
Region IV 33.62 loans, grants and an equity mix depending on
the income level of LGUs and the nature of
Region V 36.44
a particular project or sub-project component
Region VI 28.88
(i.e. revenue generating or non-revenue
Region VII 25.53
generating). Higher subsidy is given to lower
Region VIII 32.89 class LGUs and for non-revenue generating
Region IX 25.16 projects.
Region X 29.41
Region XI 29.18 However, national government grants to
REgion XII 29.78 LGUs for certain devolved responsibilities and
activities have to be rationalized in terms of
The above-mentioned criteria are basically equity, externalities and economies of scale.
used by the World Bank funded Municipal Loans and grants for

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

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______________________________________________________________________________
Figure 2. Growth Rates of Revenues of Local Government Units

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

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page 46 Local Good Governance
______________________________________________________________________________

these projects are channelled through the addressed such as agro-industrialization,

Municipal Development Fund (MDF) that community health services and other related
is administered by the Bureau of Local concerns.
Government Finance of the Department
of Finance (BLGF-DOF). Another form The way ahead
of central government grant is the Local
Government Empowerment Fund (LGEF); an Despite some improvements in local fiscal
intervention mode of lowering the incidence administration, some patterns and problems
of poverty in 20 identified poorest provinces remain. Local governments continue to
in the country. Specific needs have to be treat IRA as dole out and LGUs increasing
______________________________________________________________________________
Local Good Governance page 47
______________________________________________________________________________
dependence on IRA has been observed as councils. Several administrative orders of
a proof that IRA has become more regular the central government implementing the
and predictable. LGUs have not exerted constitutional provision and the intention of
greater effort in raising revenues through the Local Government Code regarding public
the exercise of their taxing powers. The participation standards of service delivery by
absence of straightforward performance sector upon which the IRA formula should
indicators in Revenue Sharing Allocation, be partly fashioned. Apart from the minimum
could undermine LGUs tax effort and standards of service delivery, an incentive
operational efficiency and accountability. feature should also be present in the formula
Likewise, such unconditional grants cannot to encourage LGUs to exert greater tax
stimulate LGUs to engage in long-term effort and embark on development projects
capital investments and other development beyond the basic services they are supposed
projects beyond the required basic services. to deliver. Administrative and operational
However, as LGUs confront the challenges of efficiency should also be rewarded using
devolution and as they become increasingly the national grant through special projects.
aware of the extent of their responsibilities, A portion of the IRA could be transformed
there is now a growing clamor to revise into a specific grant tied to tax effort or its
the present IRA formula because it has variant. Provision of national government
resulted in inequitable increments for the grants over and above the IRA, for devolved
different levels of LGUs. More and more activities should be strictly justified on the
LGUs especially the urbanizing ones are basis of equity, externality and economy of
beginning to realize the importance of scale and such intervention should be in a
mobilizing local revenues and even availing form of matching grant and must be specific
of credit financing to underwrite the massive and time bounded. The LGUs must put up
financial requirements of devolution and equity to the grant in order to have a sense of
development. Besides, the mandatory review ownership of the project and also to ensure
of the Local Government Code after 5 years goal congruence.
of implementation is underway. This is now
the opportune time to revisit the present IRA The Philippines may have taken significant
formula as contained in the code. strides in the implementation of devolution.
Power relations between the national and
The issue of fiscal federalism is central local governments have been reconfigured.
to the success of the decentralization However, five years later in spite of the gains
programme in the country. The fact that achieved by devolution, there are still a
there are gainers and losers among different number of issues to be addressed. Foremost
levels of LGUs under the new IRA formula is the issue of fiscal federalism and central
and that national government continues to this issue is the IRA formula. The formula
to fund some devolved responsibilities, is devoid of any performance indicator, thus
strongly suggests the need to review the threatening the agenda of devolution in terms
present expenditure assignments between of equity, fiscal performance and efficiency
national and local governments to once and in service delivery. It is imperative therefore
for all minimize if not totally eliminate the to establish certain parameters/indicators
overlaps and duplications currently existing of performance to apply to the Revenue
resulting in economic inefficiency. To Sharing Allocations in order to ensure vertical
rationalize the IRA formula, there is a need and horizontal balances as well as fiscal
to establish certain minimum Civil societies empowerment of LGUs as these are the heart
are represented in various local development of decentralization.
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page 48 Local Good Governance
______________________________________________________________________________
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 officials
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
influence and regulatory powers in financial
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,
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Local Good Governance
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 affirmative 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 specific 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
financial constrains and difficulties.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
page 49
______________________________________________________________________________
It seems that lack of political will is to blame
for the continued non-implementation of local
sectoral representation. Local government
officials 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.
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

Issues The Barangay Justice Programme is the largest

community voluntarism programme involving
• Whether or not sectoral representatives some one million-community mediators. It is a
will be elected at large or only by their system of settling disputes outside the judicial
respective sectors 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
• Whether or not sectoral representatives has saved the government billions of pesos in
will be directly elected at all levels adjudication costs besides an equally important
(municipal, city, or provincial) contribution of maintaining peace and order
at community level. The administration of
• How to prevent exploitation of the local justice is characterized by an over clogging
sectoral representative system by non- of dockets in the courts, resulting in the delay
marginalized groups in the dispensation of justice. To remedy
this situation, the government established
• Sectoral representatives might not be the Barangay Justice Programme in 1978
regarded as ‘real’ members with the which involves 42,000 Barangays organizing
same rights and responsibilities as those mediation boards which are mediating disputes
elected at large. outside the courts. The review tier of local law
stops at the Provincial Government. Municipal
• Where the compensation for additional laws or those of component cities are subject to
representatives will come from review by the Provincial Legislative Council.
Barangays ordinances are likewise subject to
On September 22, 2005, Republic Act review by component cities or municipalities
No. 9340 was amended calling for the to which they belong. Except for controversial
synchronized election of Barangay and local tax laws, the national government has
Sangguniang Kabataan (SK– the youth no control or supervision on local legislative
representative in local governments). making. The power of general supervision by
the President as provided for in the Constitution
Barangay and Sangguniang Kabataan (SK) has been decentralized and so there is tiering
elections will be held on October 29, 2007 based in the exercise of power of general supervision
______________________________________________________________________________
page 50 Local Good Governance
______________________________________________________________________________
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 specific cases:
• Reclassification 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 specific and
mandatory, with sanctions against local officials
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
Board—Proposes budgetary
allocations for health programs to the sanggunian,
serves as an advisory committee, and sets technical
and administrative standards for health.22
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Local Good Governance
Local Peace and Order Council
Council—Assesses
peace and order situation, formulates, monitors,
implements plans and programs to improve peace
and order and public safety in the locality.23
Local School Board
Board—Serves as an advisory
committee on educational matters, determines
supplementary budget for maintenance of schools,
and authorizes disbursement of said budget.24
Local Pre-Qualification 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 office equipment, renovations, and other
local government unit disbursements.
Two NGO representatives may sit to act
as watchdog. This enforces accountability
of public officials and transparency in
government contracts.25
Local Development Council
Council—It is here that
NGO representation is most prolific 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
five-year development plan to be approved by
the sanggunian, formulate public investment
programs, incentives to promote inflow 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 first 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.
• 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 Specific to Local Development
Councils

Despite these bodies being primarily advisory (LDCs) (PhilDHRRA, 2001)

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 • Absence of accountability. Many 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.
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page 52
• LGU resistance to NGOs. Local officials
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 officials
would likely find it difficult to control them.
• Reluctance of NGOs to work with LGUs.
Some leaders are concerned about co-opting
their values if they work with local officials
in the LDCs.
officials 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
Local Good Governance
______________________________________________________________________________
higher LDCs. Also LDCs cannot command
accountability from local officials 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 members 29
• Functions of LSBs need to be clearly defined
• How to influence 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 influence the allocation of the other and enhance the economic and social well-
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).
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Local Good Governance
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 fide associations of citizens with
demonstrated capacity to promote the public
interest and with identifiable 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
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,
financial 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 this provision for active partnership and as
development councils. Several administrative leverage for gaining recognition, it may be the
orders of the central government case that the local government unit sees this
implementing the constitutional provision and relationship in a more pragmatic light as a means
the intention of the Local Government Code of debureaucratization, essentially, privatization,
regarding public participation in all in general, which is also provided for in the Code:
require that all local councils in all levels
should be represented by various NGOs and Sec. 3(l) The participation of the private
POs such as farmer cooperatives, fishermen’s sector in local governance, particularly in the
associations etc. Several sectors of society delivery of basic services, shall be encouraged
like youth; women, farmers and other special to ensure the viability of local autonomy
groups have voices in the process of public as an alternative strategy for sustainable
decision making. A mandatory provision development. With this provision, an
insofar as membership of POs and NGOs in interesting question is raised as to the purpose
development councils in all levels states is of participation. Private sector participation
concerned is that they should represent 25 per in basic service delivery is very much the
cent of the total membership of these councils. new style of public management that stems
Local legislative councils do not act local from decentralization as espoused by the
laws like tax ordinances with finality unless World Bank (World Bank, 1997). This was
public hearings are conducted first. The idea expressly a concern of USAID in pushing
of consulting people first before any taxes is for decentralization in the Philippines (as
adopted by the local legislative bodies is to discussed in Abesamis, 1995: 52, 65).
operationalize the concept of representation
by the constituencies through public hearings For others, however, participation is
and consultation before the imposition of hoped to bring with it much more. Indeed
proposed local taxes. NGOs and POs are a prime concern of the constitutional
likewise very active in local development provision on participation is the pursuit
activities. These institutions work very closely of democracy. The Supreme Court made a
with local authorities in attaining mutual ruling that provisions relating to people’s
community interests. Some 16,000 NGOs and organizations are about decision-making
POs undergo a process of accreditation that in the political department, which confirms
determines the types and classes of NGOs people’s participation to be for the purpose
existing in all regions. The process includes of democratization rather than the level of
the determination of the subjects and ideas project implementation.
NGOs advocate, such as environmental
protection, legal issues and rights to It is important to look where people are
development including lobbying efforts to participating and ask why? International
protect/promote specific sectoral interests. Finance Institutions (IFIs) and Official
Development Assistance are increasingly
Democratization or Debureaucratization? looking for NGO and PO components to
participate in their development projects.
An active partnership in a joint venture such There is strong concern that reduction to
as capability building is built on the premise project level participation may de-politicize
that the local government unit concerned, participation and co-opt civil society’s
particularly the local chief executive, is open democratization goal. While committing
and supportive of such a framework for time and energy to participate in economic
participation. Although the NGOs maximize development projects, often ‘band-aid’ for
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page 54 Local Good Governance
______________________________________________________________________________
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. Beneficiaries 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 peasant concerns to be heard at the policy
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 of active partnerships on special projects,
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Local Good Governance
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).31Specifically, 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
level. However, early assessments have
shown the majority of the BARCs remain
unorganized or are headed by local officials
and landowners. PO/NGO participation at
the local level tends instead to take the form
page 55
______________________________________________________________________________
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 fisherfolk 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 fisherfolk
representatives seven municipal fisherfolk, one
fish worker and three commercial fishers).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
fishery ordinances; and assisting in the enforcement
of fishery 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 Trends & Changes in Citizens Participation
all national government agencies and Frameworks
offices to conduct periodic consultations
with appropriate local government Trends in Implementing Participation
units, non-governmental and people’s
______________________________________________________________________________
page 56
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
Frameworks
Local Good Governance
______________________________________________________________________________
Based on the experiences of citizens’ feasible, and without certain parameters
participation in mandated venues, key trends to define participation it is likely that no
have been identified, which may act as helping participation will occur. (This assumes that
or hindering factors to the implementation of we are talking about a narrow definition of
these legislated participation frameworks. On participation as defined by legislation and not
the whole, implementing the frameworks is the extent of democratic participation that the
difficult and there is still resistance from those Constitution allows.)
with political power.
To work within structures they should be organized
This is evident from the fact that the and functional. In many instances, however, this is
constitutional provision that is most not the case. For example if, in a particular locality,
threatening to those in power, local sectoral the Barangay Council is not functional (because
representation, has still not been enabled there are no regular meetings or active committees
15 years after the Constitution was ratified. for example), it is unreasonable to expect that
In addition, the Local Government Code the Barangay Development Council will be
and civil society’s role in governance are operational. The need then is to organize and
not fully understood and appreciated by provide skills training for both the barangay council
either government officials or civil society and development council.
organizations.
Resources
Active Partnerships & Political Will
A key hindrance to implementing participatory
Where there has been successful citizens’ legislation is the lack of resources, human and
participation, it is often in the context financial, as has been the case with the Local
of active partnerships. In these cases the Development Councils. Similarly, the cost of
local chief executive or key councilors providing for three extra seats reserved for
are usually perceived by civil society to local sectoral representation is given as one
be ‘open,’ ‘friendly,’ and ‘progressive.’ reason the local officials will not support the
Even if the local chief executive is implementation of this provision. In order to
not progressive, civil society is still organize and maintain structures, resources
comfortable with a critical collaboration. are also required; the law, however, does not
However, removal of the active partner can always provide for them.
lead to the end of a venue for participation.
Therefore, the role of an active partnership Quality of Participation and Representation
the local government unit can be said to be
an enabling but not necessarily a sustaining Many of the venues for participation rely
factor. on the participation of ‘representatives,’
usually of NGOs and POs. However,
Structures problems regarding the quality of
participation and representation consistently
Much of the legislation provides for specific reoccur throughout the literature and from
structures, such as committees, councils and discussions with development practitioners.
special bodies. Some argue that structures Although laws exist, there can be no
reduce the potential for dynamic participation guarantee that the participation prescribed
and can be restrictive. On the other hand the in national legislation will be of quality,
presence of structures in which to participate neither are the checks to consider who is
makes institutionalizing participation more representing whom.
______________________________________________________________________________
Local Good Governance page 57
______________________________________________________________________________
Representation from the ‘private sector’ may their situation together, in order to deepen
be business, civic organizations or NGOs, their understanding of their situation, and to
all of which have very diverse interests. It is consolidate their agenda. They will then be
impossible that one will sufficiently represent able to negotiate for their specific interests
the others. There are also NGOs that are set up in the various venues of participation where
by local chief executives, and it is uncertain multiple and conflicting interests are found.
whom the constituents are that they claim to One effective strategy is for sectoral POs
represent. to federate at the municipal level so their
voice can be heard. This type of network
One area where the issue of quality building is also a good strategy for achieving
of participation arises is in Gender a consolidated civil society agenda, for which
And Development (GAD). Women’s civil society can then lobby.
representation, particularly at the
community level, tends to be reduced to Capability Building
the number of women participating and
possibly voicing out opinions and actively The skills, knowledge and capability of the
planning for the first time, but does not actors involved will affect the quality of
necessarily ensure that gender issues will be participation. Local government officials
represented. especially at the barangay and municipal
levels require trainings in various areas of
Similarly, indigenous peoples may attend local governance and indeed this has been the
training or consultation but because of nature of some joint ventures between LGUs
existing power relations, it is unlikely that and CSOs. This will help towards improving
their participation will be meaningful. It the functionality of the structures.
appears that the LGC remains inadequate in
responding to special governance concerns of Organizational Capacity of POs and NGOs
peoples with diverse cultures and indigenous
governance systems, concerns that the The capability of POs and NGOs is very
government should consider given that 18 important because this affects how the LGUs
percent of the population may be described as perceive them. They should be competent in
indigenous people. local governance matters and in the training
they offer. Many NGOs are experiencing a
Some of these concerns over quality of paradigm shift from ‘expose and oppose’
representation may be met if community (conflict) to ‘compose and propose’ (critical
organizing and the strengthening of POs are collaboration) and may need more than
prioritized. knowledge on policy formation or local
government processes to participate in local
Organized Agendas governance. Attitude affects the effectiveness
of active partnerships.
Although the importance of organizations
and their capabilities is considered in the Accountability check
Constitution and local legislation, such as
the Empowerment Ordinance of Naga City, While the venues for participation are present,
national legislation tends to overlook these they are underutilized in so far as holding
concerns. For the disempowered to participate the erring LGU officials accountable for
effectively, it is essential that they undergo their actions. For example, with regard to
a process of Action-Reflection-Action on disciplinary actions, the process is often
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page 58 Local Good Governance
______________________________________________________________________________
subject to political influence. 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 officials perform well, the officials
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 officials 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
influencing policy on local governance, including
reviving its participation in the Oversight
Committee.
Working Group identified the main challenges
to peoples’ participation in governance as
being located under the ‘3 i’s’ framework:
Implementation, Improvement and Interrelation
______________________________________________________________________________
Local Good Governance
(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-filed 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. Specific
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 officials 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. Specific amendments
would be:
page 59
______________________________________________________________________________
• 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 definition of NGO and PO
to prevent local elected officials 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 Clearly it is the duty of civil society to
in legislation and practice made by continue to organize itself, consolidate
courageous local officials working in agendas and maintain a critical
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page 60
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 efficient 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?
Local Good Governance
______________________________________________________________________________
collaboration with government to advance Finally, it should be remembered that no matter
democratic participation in governance how good legislation is, lanes of participation
within formal and informal venues. Only a cannot work in isolation; all lanes of the
strong, organized citizenry can demand the participation highway should be utilized if
accountability that participation may offer. genuine change is the goal.

- End -

______________________________________________________________________________

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
______________________________________________________________________________
Local Good Governance page 61
______________________________________________________________________________
11. Legislating for Citizens’ Participation in the Philippines; by NINA T. ISZATT, Policy Advocacy
Officer for KAISAHAN tungo sa Kaunlaran ng Kanayunan at Repormang Pansakahan, a
Manila-based NGO working in the fields 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 Pacific; 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 Office, 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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page 62 Local Good Governance
______________________________________________________________________________
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
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Local Good Governance page 63
______________________________________________________________________________
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

1987 Constitution of the Philippines, Art. XIII Sec. 5

32

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 filed by Senator Juan Flavier (Senate Bill 1348) and by Rep.
Florencio ‘Butch’ Abad (House Bill 5636).

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