community driven development and accountable …
TRANSCRIPT
COMMUNITY DRIVEN DEVELOPMENT AND ACCOUNTABLE LOCAL
GOVERNANCE: SOME LESSONS FROM THE PHILIPPINES
October 15, 2009
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TABLE OF CONTENTS
LIST OF ACRONYMS ................................................................................................................ ii
EXECUTIVE SUMMARY ......................................................................................................... iv
1. Introduction ............................................................................................................................1
2. Conceptual Framework and Methodology ..........................................................................3
2.1 Conceptual Framework ....................................................................................................... 3
2.2 Methodology ....................................................................................................................... 4
3. Institutional Environment for Accountable Local Governance ........................................6
3.1 Supply-side Conditions ....................................................................................................... 6
3.1.1 Fiscal Dimension ................................................................................................... 6
3.1.2 Administrative Dimension .................................................................................... 11
3.1.3 Political Dimension ............................................................................................... 14
3.2 Demand-side Conditions ................................................................................................... 16
3.2.1 Association ............................................................................................................ 16
3.2.2 Access to Information ........................................................................................... 18
3.2.3 Voice, Negotiation and Oversight ......................................................................... 21
4. Accountable Local Governance and CDD Operations .....................................................26
4.1 Impact of Local Governance Conditions on CDD Operations ......................................... 26
4.1.1 The Impact of Supply-side Conditions ................................................................. 26
4.1.2 The Impact of Demand-side Conditions ............................................................... 29
4.2. Impact of CDD Operations on Local Governance Conditions ......................................... 30
4.2.1 The Impact on Supply-side Conditions................................................................. 30
4.2.2 The Impact on Demand-side Conditions .............................................................. 33
5. Conclusions ...........................................................................................................................35
5.1 Main Findings ................................................................................................................... 35
5.1.1 Opportunities for Enhanced Accountability ......................................................... 35
5.1.2 Challenges to Social Accountability ..................................................................... 36
5.1.3 Interactions between Local Governance and CDD Operations ............................ 37
5.2 Recommendations ............................................................................................................. 39
Annex 1: Bibliography .................................................................................................................. 41
Annex 2: Description of the Case Study Projects ......................................................................... 44
Annex 3: Maps and Key Features of the Case Study Municipalities ........................................... 53
Annex 4: Local Governance Conditions: Comparing Enabled and Constrained Environments .. 55
Annex 5: Key Financial Data of the Case Study Municipalities .................................................. 56
Annex 6: Local Governance Conditions and Their Interactions with CDD Operations .............. 58
Annex 7: Local Governance Conditions and the Space for Social Accountability ...................... 60
Annex 8: Examples of CSO Engagement in Social Accountability ............................................. 63
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LIST OF ACRONYMS
AED Agricultural Enterprise Development
AFP Armed Forces of the Philippines
AIP Annual Investment Plan
ARC Agrarian Reform Community
ARCDP Agrarian Reform Communities Development Project
ARMM Autonomous Region for Muslim Mindanao
ARSP Agrarian Reform Support Program
ATIN Access to Information Network
AUSAID Australian Agency for International Development
BAC Bids and Awards Committee
BBGC Barangay-Bayan Governance Consortium
BDC Barangay Development Council
BDP Barangay Development Plan
BIARSP Belgian Integrated Agrarian Reform Support Program
BJMP Bureau of Jail Management and Penology
BRT Barangay Representation Team
CBO community-based organization
CDD community-driven development
CIDDS Comprehensive Integrated Delivery of Social Services
COA Commission on Audit
CODE-NGO Caucus of Development NGO Networks
COMELEC Commission on Elections (Philippines)
CSO civil society organization
DBCC Development Budget Coordination Committee
DILG Department of the Interior and Local Government
DPWH Department of Public Works and Highways
DSWD Department of Social Welfare and Development
EDF Economic Development Fund
FGD focus group discussion
GAA General Appropriations Act
GAD gender and development
GFI government financial institution
GPRA Government Procurement Reform Act
GSIS Government Service Insurance System
ICC Investment Coordination Committee
INFRES Infrastructure for Rural Productivity Enhancement Sector
IRA Internal Revenue Allotment
JICA Japan International Cooperation Agency
Kalahi Kapit-Bisig Laban sa Kahirapan (“linking arms in the struggle against poverty”)
KARZONE Kalahi Agrarian Reform Development Zone
KCP Kalahi-CIDDS Project
LCE Local Chief Executive
LDC Local Development Council
iii
LGC Local Government Code
LGPF Local Governance Policy Forum
LGU local government unit
LPRAP Local Poverty Reduction Action Plan
LSB local special bodies
LSR local sector representation
MAO Municipal Agricultural Office
MARO Municipal Agrarian Reform Office
MIBF Municipal-Inter Barangay Forum
MDC Municipal Development Council
MFC Municipal Finance Corporation
MHO Municipal Health Officer
MIBF Municipal Inter-Barangay Forum
MINCODE Mindanao NGO-PO Network
MOOE Maintenance and Other Operating Expenses
MPDO Municipal Planning and Development Officer
MSWDO Municipal Social Welfare and Development Officer
NCRFW National Commission on the Role of Filipino Women
NEDA National Economic Development Authority
NGO non-government organization
NIA National Irrigation Authority
NSCB National Statistics Coordinating Board
ODA Official Development Assistance
OSR own-source revenue
PAP programs, activities, and projects
PATSARRD Philippine-Australia Technical Support on Agrarian Reform and Rural Development
PBAC Pre-Qualifications Bids and Awards Committee
PCNC Philippine Council for NGO Certification
PDAF Priority Development Assistance Fund
PhP Philippine peso
PIO public information officer
PNP Philippine National Police
PO peoples’ organization
POC Peace and Order Council
PPDO Provincial Planning and Development Office
PRA Preparatory Recall Assembly
PSA participatory situational assessment
RWSA Rural Waterworks and Sanitation Association
SB Sangguniang Bayan (municipal legislature)
SEF Special Education Fund
ULAP Union of Local Authorities in the Philippines
UNICEF United Nations Children’s Fund
USAID United States Agency for International Development
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EXECUTIVE SUMMARY
Community-driven development (CDD) is associated with community support approaches to the
delivery of public goods and services, promoting civil society empowerment strategies, and
favoring the mobilization of community-based organizations (CBOs) for collective action and as
interlocutors between people and public service providers. Decentralized local governance is the
localization of authority in, and accountability for, the use and generation of fiscal resources and
the provision of public goods and services. Local governance relates not only to local institutions
like local government and local public sector agencies, but also encompasses a variety of civil
society institutions such as community-based resource user groups or citizen oversight bodies.
Both these modes of delivering public goods and services hold the promise of making democracy
work for the poor by enhancing the means by which those who deliver public goods are held
accountable by those who demand them. Indeed, they are complementary approaches. This study
proceeds from recognition of the potential complementarities between community-driven
development and decentralized local governance, and the need to identify strategies for
operational integration. It aims to deepen the understanding of how the institutional environment
for local governance interacts with CDD project operations. It gives special emphasis on the
issue of accountability, analyzing how CDD operations perform in terms of strengthening the
capacity of citizens and civil society to hold local authorities and public service providers
accountable, and the capacity of the local government to be held accountable.
The study utilizes a two-pronged approach. First, it assesses the institutional environment for
accountability in local governance. Second, it examines the operations of two major World
Bank-assisted CDD projects in two municipal case study sites. Given that CDD projects both
shape and are shaped by local governance contexts in which they are embedded, the study
investigates how CDD operations in the Philippines are affected by and are helping reform local
governance conditions. It is from the analysis of this interface between CDD operations and local
governance conditions that the study aims to generate policy and operational recommendations
to enhance integration between CDD and local governance approaches.
On the supply side, this study analyzes the extent to which the decentralized: (1) fiscal system
generates incentives for citizen participation in local governance and for strengthening demand
for public accountability; (2) administrative system enables local governments to act on locally
produced policies as well as respond to issues affecting local constituencies; and (3) political
system provides incentives for elected political leaders to act independently and in line with local
interests. On the demand side, this study describes how the legal framework enables or
constrains: (1) association and the pursuit of collective goals by civil society organizations
(CSOs); (2) voice and the ability of CSOs to articulate preferences related to societal goals; (3)
access to information and the extent to which this enables meaningful CSO participation in local
governance processes; (4) negotiation and how spaces for local public debate, lobbying and
assembly are utilized to influence public policy choices; and (5) oversight by CSOs of policy
formulation, budget planning, execution and procurement processes.
Using these conceptual categories, the study addresses the following research questions:
v
How does the macro-level institutional environment constrain or enable accountability in
local governance?
How is this institutional environment manifested where CDD projects operate?
What are the effects of the local governance conditions on CDD operations?
What impacts do CDD operations have on the local governance context?
What policy and operational recommendations can be derived from this analysis?
The study was implemented in two phases. Phase 1 analyzed the institutional environment in
which local governments and CSOs are embedded and the assessment of the extent to which this
environment fosters social accountability. Phase 1 was mainly based on a desk review of local
governance policies and relevant literature. Phase 2 focused on the analysis of the enabling
environment at the local level as it interacts with CDD operations. Two municipalities were
chosen that both had the presence of the two Bank CDD operations but with different local
contexts: one with an enabling local environment (Pilar) and one with a constrained environment
(Pio Duran). The field research in the case study sites involved project document review,
interviews, focus group discussions, and validation sessions with local stakeholders.
Main Findings: Opportunities and Constraints for Enhanced Accountability
The analysis of the institutional environment for accountability in local governance often found
an enabling policy and legal framework in principle, but severely limiting constraints in practice.
Local governments have enough administrative autonomy. The Local Government Code
(LGC) and the Constitution provide a clearly elaborated set of rules for discretion to legislate,
decide and act on locally-produced policies. Local governments also have power over human
resource management including recruitment, hiring, and promotion, and defining the
organizational structure of the local bureaucracy.
However, local governments provide little opportunity for enhancing accountability and
transparency. The municipal budget proposed by the mayor is subject to the approval of the
Sangguniang Bayan (municipal legislature), but no real deliberations occur in budget hearings,
which are usually not open to the public. There is limited effective participation in the
preparation and monitoring of the budget, largely because the budget document and other
expenditure statements are not disseminated. LGU financial management skills are weak,
leadership is lacking, and there is weak oversight by national government agencies. Obstacles to
a merit-based system limit the accountability and transparency of the local bureaucracy.
Fiscal decentralization generally enhances the institutional environment for local
government accountability. Expenditure assignments are generally consistent with the
subsidiarity principle, revenue collection responsibilities support efficiency and administrative
feasibility, and central transfers are mostly formula-based unconditional grants. These represent
a shift away from a highly-centralized fiscal regime, thus enhancing incentives for citizens to
participate in local governance and demand accountability.
Norms related to central-local fiscal transfers shape local governance conditions. Because
these transfers tend not to be based on transparent rules, but on the strength of local political ties
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with the central authorities that dispense them, this has fostered a governance mindset that values
the ability of local political leaders to obtain external funds for development projects. The result
is that these norms undermine citizen participation in planning and budgeting.
Local governments face tight fiscal conditions. They are characterized by limited own
resource generation, limited capacity for capital spending, dependence on central transfers and
budget constraints softened by the availability of significant discretionary central transfers. All
these serve to delink local spending from local revenue generation and weaken the incentives for
citizens to participate in local governance activities. Political accountability is further weakened
to the extent that central government transfers to local governments tend to foster loyalty of
elected congressmen to the incumbent president.
Accountability is strengthened by the legal political framework. It provides for direct
subnational elections from the village to the province, with clear term limits. There is a clear
separation of powers between the legislative and executive branches at the national and local
levels. Direct democracy is promoted by constitutional provisions for recall, initiative and
referendum. At the local level, citizens can propose the enactment, repeal or amendment of an
ordinance as well as directly amend, reject or approve an ordinance through referendum.
Political dynamics limit the effectiveness of democratic institutions and decentralized
administrative arrangements. The absence of platform-based political parties and the
predominance of personalistic political culture tend to weaken political accountability by
narrowing the range of constituents to whom politicians are responsive. The situation is
exacerbated by strong tendencies for local state capture by historically-entrenched local bosses,
which historically form the basis for state formation.
Access to information is buttressed by four elements of the legal policy framework. First,
the Code of Conduct and Ethical Standards for Public Officials and Employees mandates that all
public officials provide information on their policies and procedures. Second, the Supreme Court
makes rulings on what constitutes information that are public in nature. Third, administrative
orders classify documents as public or instruct public agencies on ways to disclose public
information. Finally, the 1991 LGC contains important provisions that compel local government
to provide information to the public.
However, practical constraints to access to information are major obstacles to enhancing
the space for exacting local government accountability. Constitutional provisions and
jurisprudence are not enough to enforce this right. The loosely-worded list of government
information exempt from constitutional provisions is a problem. The right to information is not
absolute and is subject to the interpretation of what constitutes information that is of public
concern. Compliance with LGC provisions compelling local governments to publicly post
relevant information is not closely monitored. Just as serious is the absence of a widespread
predisposition for citizens to demand information.
The formation of civil society groups is encouraged by strong constitutional provisions for
the exercise of civil liberties. Freedom of association and expression, and the right to
information, are guaranteed by the 1987 Constitution. Enforcing this right to information are rich
vii
jurisprudence, a number of executive issuances and a law that obligates public officials to
provide information. The exercise of voice, negotiation and oversight by civil society is
encouraged at the local level by provisions in the LGC for participation in consultative bodies
involved in development, and investment planning and the formulation of sectoral policies.
The Philippines also has a fully elaborated legal framework for the establishment of
institutions of direct democracy and enhancements to representative institutions. This
framework includes: (i) constitutional guarantee of freedom from persecution based on political
beliefs and freedom of expression enshrined in a Bill of Rights, (ii) the granting of legislative
powers to citizens through LGC provisions for referendum, initiative and recall and a separate
law called the Referendum and Initiative Act, and (iii) the establishment of a party list system
and local sectoral representation.
The provisions for referendum, recall, the party list system, and local sectoral
representation have proven ineffective. Three attempts at implementing initiatives at the
national level have failed. There has also been no progress at the local level in terms of
referendum and recall. The implementing procedures are cumbersome and initiatives taken in the
name of people, NGOs and POs are not genuine.
LGC provisions for civil society participation in local special bodies are largely ineffective. CSO representation is lacking in substance not only due to lack of capacity but also because the
exercise of voice is limited to consultation rather than a substantive role in prioritization and
decision-making. There are no operational institutional processes where citizens can exercise
oversight and negotiation. Thus, there is a disconnect between the capacities built by CDD
operations on the demand side and governance processes in which these capacities may be used.
Civil society difficulty in exacting accountability is as also due to their limited technical
capacity. CSO engagement with local government in budget monitoring, planning and service
delivery is still in its infancy. This partly explains why spaces for civil society participation in
local special bodies are not fully exploited.
Main Findings: Interactions between Local Governance and CDD Operations
The case studies confirm the constraints and opportunities created by demand- and supply-side
conditions as shaped by macro-level incentives.
Norms related to central-local fiscal transfers shape local governance conditions. Because
these transfers tend not to be based on transparent rules but on the strength of local political ties
with the central authorities that dispense them, this has fostered a governance mindset that values
the ability of local political leaders to obtain external funds for development projects. The result
is that these norms undermine citizen participation in planning and budgeting. For example, they
put PDAF allocations beyond the ambit of Local Development Councils (LDCs), the body
through which the community and CSOs can participate in budget planning and oversight.
The LGC provisions for civil society participation in local special bodies lack effectiveness
in substance and in form. In both the enabled and the constrained municipalities, the only
difference is that there is nominal representation in at least two local special bodies in the former
viii
(i.e., in the LDC and the Local School Board). CSO representation is lacking in substance not
only because of the problem of capacity but also because the exercise of voice is limited to
consultation rather than a substantive role in prioritization and decision-making. There are no
operational institutional processes whereby citizens can exercise oversight and negotiation. Thus,
there is an emerging disconnect between the capacities built by CDD operations on the demand
side and governance processes in which these capacities may be used.
Despite the constraints imposed by these macro-level conditions, innovations in local
governance have been triggered by reformist leaders. While the two case study
municipalities are dependent on similar size central transfers for financing much of their
expenditures, innovations in cost sharing and enhanced structures of vertical and horizontal
accountability are being tested in Pilar but not in Pio Duran. In Pilar, two context-specific factors
support this openness to innovation: (i) a local bureaucracy previously exposed to new ideas on
cost-sharing and community mobilization through their experience with other donor-assisted
projects; and (ii) exposure to provincial government innovations in reducing poverty.
However, constrained local environments—due to conflict, elite capture and patronage—
reinforce macro-level disincentives for good local governance. In these contexts, the
interactions between demand- and supply-side conditions are also evident. Local politics
undermine building incentives for social accountability as it imposes constraints on community
organizing and makes it more difficult to build trust between communities and local government.
In such constrained local governance contexts, CDD operations provide a significant
channel for the poor to access goods and for communities to exercise voice. CDD operations
enable the alignment of some local development funds and transfers from central government
institutions with priorities set by communities, an improvement from previous conditions where
the use of these funds was based largely on political discretion. Moreover, the use of social
accountability tools like participatory planning, budgeting, monitoring and project
implementation are helping develop relevant skills in local governments, citizens and civil
society. This encourages community volunteers to engage their elected local leaders.
However, it seems unlikely that these innovations and reforms will be sustained or expand
beyond the CDD project life. In Pio Duran, CDD projects are giving the communities their first
taste of engaging local government at the barangay level and in exercising voice in the choice,
implementation and monitoring of sub-projects. But because of the absence of institutionalized
processes for negotiation and voice in budgeting and planning, this experience remains in a
project bubble. For example, it seems that there are prior conditions that have to be met—on the
supply side, reforms in central transfers so that more of these are subjected to local control; on
the demand side, capacity for voice and association—for the development councils to
institutionalize participatory planning and budgeting introduced by CDD projects.
In contrast, in an enabled local governance context, CDD operations have been
implemented more smoothly and may influence local conditions beyond the project. In
Pilar, CDD operations have led to innovations in bidding and procurement, in leveraging local
resources in the mobilization of central transfers, and in energizing the local bureaucracy to find
better ways of governing.
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Thus, differences in local conditions contextualize CDD operations and their impacts in an
important way. The enabling environment plays a key role in determining opportunities for the
ability of CDD operations to help improve local governance conditions. In turn, an
understanding of locally-specific factors like these is important in evaluating the opportunities
for local governance reforms.
Recommendations
Enhancing the environment for participation in planning and budgeting requires reforms
in central-local fiscal transfers, particularly discretionary transfers. Initial reforms may
include requiring that these transfers fund only those projects identified in the municipal
development plan. This will give municipalities some control over the allocation of these
transfers, rather than it being based only on the discretion of legislators. The institutionalization
of cost sharing arrangements, including provincial and congressional transfers, is another
potential early reform. This arrangement can align central funds with community-set priorities.
It is important to strengthen checks and balances for central transfers, and increase the
oversight capacity of civil society. A supply-side constraint may be addressed in part by
strengthening demand-side conditions, by building the capacity of national and local NGOs to
technically and politically engage in national and local budget processes.
CDD operations should better incorporate local governance into their design. It cannot be
assumed that municipal and barangay officials and community members will see how the skills
and social technologies embedded in CDD operations can be applied to local governance
processes. It involves determining if local government processes and institutional arrangements
can be the nodes for the institutionalization of participatory practices. This strategy needs to be
devised in conjunction with an analysis of necessary policy support to mitigate macro-conditions
affecting, but not directly within, the ambit of project operations (e.g., the problems posed by
politicized central transfers).
A local government assessment tool could help CDD operations to adopt context-specific
strategies to exploit opportunities for improving local governance. Some local contexts are
more conducive than others in mainstreaming participatory and inclusive governance processes.
Innovations in cost sharing, mainstreaming participatory procurement, and poverty-targeted
budgeting require further investigation, documentation and support. They would make good
readiness indicators for CDD institutionalization.
The ultimate success of CDD is determined when its key principles of participation, transparency
and accountability are incorporated into the planning and budget systems of local governments.
This in turn, supports the long-term agenda for reform. This report shows some factors that shape
the local governance and accountability space are within the influence of CDD operations. These
include shoring up administrative skills of the local bureaucracy for participatory governance,
animating governance arenas like the barangay assembly, building community capacity for
voice, negotiation and oversight, and using the experience of civil society-local government
synergies to generate trust. However, other factors are beyond the influence of CDD operations,
x
such as local political dynamics, the politics of central-local transfers, and the design of
institutional arrangements for vertical and horizontal accountability. Therefore, CDD operations
alone are not enough to institute the necessary reforms for greater accountability in local
governance. Rather, they are seedbeds of reform that need to be nurtured by complementary
initiatives that will address the problems of patronage, discretion and lack of transparency.
1
1. Introduction
The past two decades have been a watershed period in the evolution of democratic practice
in the Philippines. In 1987, in the aftermath of a popular uprising that ousted President
Ferdinand Marcos, the government ratified a new constitution with strong provisions for
associational autonomy that laid the framework for decentralization. In 1990, the Local
Government Code (LGC) was enacted for implementing decentralization. This law provided for
the substantial devolution of public authority to directly elected sub-national levels of
government which were also vested with increased shares of internal revenue and the power to
generate their own revenues. The LGC also mandated civil society participation in local
governance processes.
The Philippines also made important strides in poverty alleviation during this period,
almost halving poverty incidence from 44.2 percent in 1985 to 24.7 percent in 2003. However,
the most recent poverty statistics reveal a rise in poverty incidence to 26.8 percent in 2006. The
absolute number of families living in poverty also grew from 4.0 million in 2003 to 4.6 million
in 2006. Moreover, income equality has persisted with the GINI coefficient worsening from 41.0
in 1985 to 44.5 in 2003.
Community-driven development (CDD) sees the poor as the prime actors rather than
targets of poverty reduction efforts. Control of decisions and resources rests with community
groups working in partnership with demand-responsive organizations and service providers such
as local governments, non government organizations (NGOs) and central government agencies.
CDD is associated with community support approaches to the delivery of public goods and
services, promoting civil society empowerment strategies, and favoring the mobilization of
community-based organizations (CBOs) for collective action and as interlocutors between people
and public service providers.
Decentralized local governance is the localization of authority in, and accountability for,
the use and generation of fiscal resources and the provision of public goods and services. Local governance relates not only to local institutions like local government and local public
sector agencies, but also encompasses a variety of civil society institutions such as community-
based resource user groups or citizen oversight bodies.
Both these modes of delivering public goods and services hold the promise of making democracy
work for the poor by enhancing the means by which those who deliver public goods are held
accountable by those who demand them. Indeed, they are complementary approaches. Serrano et
al. (2005:2) note they share the same basic principles: “the empowerment of citizens in
interactions with governance and service provision institutions, the importance of beneficiary
demand for determining service characteristics, greater administrative autonomy among service
delivery managers along with greater accountability to citizens and service consumers, and
enhanced local organizational and human capacity for increased impact and sustainability.”
This study proceeds from recognition of the potential complementarities between
community-driven development and decentralized local governance, and the need to identify
strategies for operational integration. It aims to deepen the understanding of how the institutional
2
environment for local governance interacts with CDD project operations. It gives special
emphasis on the issue of accountability, analyzing how CDD operations are performing in
strengthening the capacity of citizens and civil society to hold local authorities and public service
providers accountable, and the capacity of the local government to be held accountable.
The study utilizes a two-pronged approach. First, it assesses the institutional environment for
accountability in local governance. It analyzes the key macro-level institutional constraints and
enablers in enhancing accountability in local governance. It presents micro-level snapshots of
this institutional environment as manifested in two local contexts, one enabled and one
constrained municipal government. Second, it examines the operations of two major World
Bank-assisted CDD projects—the KALAHI-CIDDS Project (KCP) and the Agrarian Reform
Communities Development Project (ARCDP2)—in the two municipal case study sites. Given
that CDD projects both shape and are shaped by local governance contexts in which they are
embedded, the study investigates how CDD operations in the Philippines are affected by and are
helping reform local governance conditions. It is from the analysis of this interface between
CDD operations and local governance conditions that the study aims to generate policy and
operational recommendations to enhance the integration between CDD and local governance
approaches.
There is a unique opportunity to strengthen the demand-side of governance in the current
national decentralization and local development policy debate which has predominantly focused
on public sector performance and finance. This study draws lessons and makes recommendations
on how to deepen, scale up, and strengthen the sustainability of CDD more consistently, building
upon and expanding innovations from current operations. Ultimately, this initiative aims to assist
in developing analytical tools for making policy, institutional, and operational choices that
simultaneously support CDD and local governance reforms by utilizing social accountability as
the foundation for increasing local governance transparency, accountability, and effectiveness in
service delivery to the poor.
The next section of this paper presents the conceptual framework and methodology of the study.
Section 3 presents the findings of an assessment of the institutional environment for accountable
local governance based on its analysis of supply and demand side conditions and their
manifestation in the case study sites. Section 4 presents the key findings in the case studies sites
in terms of how this institutional environment impacts CDD operations and vice versa. The paper
closes with a synthesis of the key research findings as well as recommendations for enhancing
the possibilities for complementarities between CDD and decentralized local governance based
on the experience of the Philippines.
3
2. Conceptual Framework and Methodology
2.1 Conceptual Framework
In this study, the institutional environment for local governance is conceived as being
constituted by conditions that underpin the ability of local governments to be held accountable
(supply-side conditions) and the ability of citizens and/or civil society to hold local governments
accountable (demand-side conditions). It posits that this environment has a structuring influence
on CDD project operations, circumscribing the ability of CDD interventions to make a
significant impact on improving the conditions for local government accountability and local
governance reforms.
For the supply side analysis, the study utilizes the framework developed by Yilmaz, Beris and
Serrano (2008) who identify fiscal, administrative and political dimensions of decentralization
that circumscribe local government discretion and accountability. The fiscal dimension of
decentralization relates to the devolved roles and responsibilities in the regulation of revenue
generation, expenditure assignments, intergovernmental transfers and borrowing. The
administrative dimension relates to local discretion over legislation, regulatory enforcement and
the civil service. The political dimension relates to how citizens elect and interact with local
leaders, the party system and oversight mechanisms. These dimensions of decentralization define
the discretionary space within which local governments are held accountable upwards by higher
tiers of government and downwards by citizens. In the schema, mechanisms for public
accountability (systems of check and balances as well as oversight) complemented by social
accountability (mechanisms whereby citizens directly engage the government to perform
oversight functions) guard against the abuse of local discretion.
This study focuses on the incentives for accountability embedded in these dimensions of
decentralization, in particular de jure and de facto conditions that enable or constrain the ability
of local governments to be held accountable. It analyzes the extent to which the decentralized:
(1) fiscal system generates incentives for citizen participation in local governance and for
strengthening demand for public accountability; (2) administrative system enables local
governments to act on locally produced policies as well as respond to issues affecting local
constituencies; and (3) political system provides incentives for elected political leaders to act
independently and in line with local interests.
For the demand-side analysis, the study uses the framework described by Anheier (2006) to
assess the environment for effective civic engagement and social accountability. In this
framework, civic action is enabled by the interface of external (i.e., legal framework, governance
and accountability conditions, and economic and social conditions) and internal (i.e., CSO
capacity for civic engagement, social accountability and service delivery) conditions that nurture
association, resources, voice, information, and negotiation. Association is freedom of association
and the institutional legitimacy of civil society. Resources refers to the ability of civil society to
mobilize resources for organizational objectives. Voice means the ability of civil society to
formulate, articulate and convey opinion. Information relates to access to information as well as
the organizational accountability and transparency of public institutions. Negotiation pertains to
the existence of spaces and rules of engagement for public and internal debate.
4
This study focuses on the legal framework governing the exercise of citizen rights to association,
voice, information and the performance of negotiation and oversight functions.1 In particular, it
gives a detailed description of how the legal framework enables or constrains: (1) association
and the pursuit of collective goals by CSOs; (2) voice and the ability of CSOs to articulate
preferences related to societal goals in public processes within and outside formal structures of
representation; (3) access to information and the extent to which this enables meaningful CSO
participation in local governance processes; (4) negotiation and how spaces for local public
debate, lobbying and assembly are utilized to influence public policy choices; and (5) oversight
by CSOs of policy formulation, budget planning, execution and procurement processes.
In summary, this study conducts an inventory of the above demand and supply-side conditions
circumscribing local governance and accountability as they are prescribed in the macro-
institutional environment. It examines how these conditions are manifested in case study
municipalities with the presence of CDD operations. Then the study turns to exploring how these
conditions affect CDD operations and how CDD operations impact upon these conditions.
Using these conceptual categories, the study addresses the following research questions:
How does the macro-level institutional environment constrain or enable accountability in
local governance?
How is this institutional environment manifested where CDD projects operate?
What are the effects of the local governance conditions on CDD operations?
What impacts do CDD operations have on the local governance context?
What policy and operational recommendations can be derived from this analysis?
2.2 Methodology
The study was implemented in two phases. Phase 1 involved the analysis of the institutional
environment in which local governments and community-based organizations are embedded and
the assessment of the extent to which this environment fosters social accountability. Phase 1 was
based mainly on a desk review of policies and relevant literature. To validate the analysis, the
desk review was complemented by key informant interviews involving:
program personnel and key policy staff in government agencies—such as the Department
of the Interior and Local Government (DILG), Department of Social Welfare and
Development (DSWD), and the Department of Agriculture (DA)—which are either
implementing programs under the World Bank CDD portfolio or with a direct mandate to
regulate decentralization processes;
civil society organizations with projects in participatory local governance including
community-based service providers involved in co-production initiatives; and
academics working on themes related to decentralization and local governance.
1 The internal conditions—in particular the capacity of CSOs to engage in exercises of social accountability—were
explored in the case study sites. Also, instead of “resources”, the study includes “oversight” as the enabling element
of interest in the analysis of demand side conditions. “Oversight” relates to the existence of spaces and rules of
engagement for the exercise of citizens' control in over local governance processes including policy formulation,
budget planning, execution and audit and local public procurement.
5
Phase 2 focused on the analysis of the enabling environment at the local level as it interacts with
CDD operations using the case study approach. Two municipal sites were chosen that both had
the presence of the KCP and ARCDP2 CDD operations but with different meso-contexts (the
province in which municipalities are situated) and the filtering criteria are political stability and
the level of development as determined by inputs from field personnel and national managers of
the CDD projects (see Annex 2 for a description of the two projects and their objectives,
components, and methods of promoting social accountability). The objective is to capture how
CDD operations can better reflect the variance in local governance. Therefore two quite different
case study sites were chosen: one with an enabled local environment and one with a constrained
one (see Annex 3 for maps and key features of the two case study municipalities and provinces).
Pilar, in Bohol Province, was considered as having a relatively enabled meso-environment for
local governance because it is in a province that has made substantial progress in reducing
poverty, improving political stability and implementing governance innovations. Meanwhile,
Pio Duran, in Albay Province, was considered as having a relatively constrained environment as
it is in a province that is calamity-prone due to its topography, still battling with an insurgency
problem and having two changes in provincial leadership within six years.
The field research involved collecting primary and secondary data. First, project reviews,
appraisal documents and socio-economic studies related to the CDD projects were reviewed to
draw out and validate assumptions about the local institutional environment. The municipal
development plan, budget and annual investment plan were reviewed.
Second, representatives of local agencies involved in the implementation of CDD projects—
including the Project Management Office (PMO), mayor’s office, participating CBOs and other
NGOs in the municipalities—were interviewed about CDD operations. Key members of the local
bureaucracy (e.g., the municipal treasurer, accountant, planning and development officer) and
members of the Sangguniang Bayan (SB, the local legislative council) were also interviewed
about local governance conditions.
Third, focus group discussions (FGDs) were conducted with three distinct groups: (1)
representatives of local civil society including the church, media, business groups, school boards
and NGOs; (2) village beneficiaries of the CDD projects; and (3) village non-beneficiaries. The
FGDs, involving 8-10 individuals each, were used to explore the demand-side conditions in the
case study municipalities and to ascertain civil society views about supply-side conditions. In the
case of FGDs involving village-level participants, three villages (barangays) were randomly
chosen—two from among beneficiary barangays and one from among those that have not
received funding from the CDD projects. CDD project community organizers helped identify
participants for the FGDs, mostly members of the barangay-level committees of the CDD
projects as well as barangay government officials. Sub-FGD groups are formed to make sure
that barangay officials are interviewed separately from non-officials.
Finally, validation and echo sessions were held at the end of the field visit. Initial results were
presented to local stakeholders to obtain comments and other feedback. The findings were also
presented to national experts on local governance and CDD at a seminar held in Manila to obtain
comments from practitioners.
6
3. Institutional Environment for Accountable Local Governance
Decentralization in the Philippines has been described as being among the most in-depth and
extensive in Southeast Asia (Rocamora 2003). White et al. (2005:33) note that the Philippines is
the only East Asian country with a multiparty political system where direct elections are
conducted at all government levels. Whether this institutional environment provides incentives
for enhanced accountability of local governments is the focus of this section. Decentralization in
the Philippines, as designed and practiced, presents a mixed picture. While it generates
opportunities for enhanced accountability, it is also limited by constraints rooted in politics,
including its historical and institutional basis. However, this study also finds that reformist
leaders have triggered innovations in local governance despite constraints imposed by macro-
level conditions. This section now explores in detail these supply and demand-side opportunities
and constraints. By presenting snapshots of the case study sites, it shows the extent to which
these conditions are manifested on the ground and under what circumstances challenges are
overcome (see Annex 4 for a table summarizing supply and demand conditions in the enabled
and constrained environments).
3.1 Supply-side Conditions
One of the stronger aspects of supply-side conditions for accountability in the Philippines is a
fully-elaborated formal framework for fiscal, administrative and political decentralization.
However, this study found that there are elements of the decentralization framework that weaken
incentives for accountability. These conditions—both the opportunities and constraints—have a
structuring influence on the operations of CDD projects and define the limits of their potential to
improve local governance conditions. In this section, advances in each dimension are described
and then key constraints are analyzed.
3.1.1 Fiscal Dimension
Fiscal Decentralization Framework
Key aspects of fiscal decentralization in the Philippines generally enhance the institutional
environment for local government accountability by delineating the local government service
delivery responsibilities and the means by which local governments finance them.
First, expenditure assignments are generally consistent with the subsidiarity principle. This
requires that a given public function must be assigned to the lowest level of government whose
geographic area internalizes the costs and benefits of decision-making (Shah 1994). In the
Philippines, provinces are assigned responsibility for services whose catchment area covers more
than one municipality while municipalities are responsible for the delivery of basic services.
Second, the vertical assignment of revenues adheres to the tenets of equity and efficiency. Following the equity principle, progressive taxes (i.e., the income tax)—collected to finance the
redistributive function of government—are collected by the central government. Following
efficiency and collection feasibility principles, local governments collect taxes on immobile
factors, like real property and community taxes.
7
Third, the majority of central transfers to local governments are formula-based
unconditional grants. In 2003, almost 70 percent of these transfers were in the form of internal
revenue allotments (IRA), the local government’s guaranteed share of national income (Soriano et
al. 2005). The IRA is distributed across local government units based on the following formula: 23
percent to provinces, 23 percent to cities, 34 percent to municipalities and 20 percent to
barangays. The respective shares of local governments are determined on the basis of population
(50 percent), land area (25 percent) and equal sharing (25 percent).
All these represent a shift away from a highly-centralized fiscal regime, thus creating enhanced
incentives for downward accountability, which in turn heightens the stakes for citizens to
participate in local governing structures and demand accountability. However, these are
countered by disincentives embedded in the fiscal system that hinder accountability by
weakening the link between resource generation and spending as well as the capacity of local
governments to respond to demands from citizens.
Challenges to Fiscal Accountability
The weakening of the link between resource generation and spending reduces accountability
based on local taxation where tax payers (citizens) demand accountability from tax spenders
(local governments). It is caused by the confluence of three interacting factors: weak local
revenue generation, some lack of clarity in expenditure assignments, and the degree of
dependence on central fiscal transfers by local governments.
First, local revenue generation efforts are weak. Local tax revenues constitute a relatively small
share of local income. In 2001, own-source revenue (OSR) accounted for 36 percent of total
revenues of all local governments—76 percent of OSR is from tax revenues. However, the World
Bank (2004:19-20) also finds that the OSR share of total revenues declined more than 20 percent
since the 1980s while the share of revenue from national government transfers increased by the
same amount. Manasan (2004:21) calculates that local government revenue effort rose only from
0.8 percent of GNP in the pre-Code period to 1.2 percent of GNP in the post-Code period.
The design of decentralized revenue assignments and the administrative weaknesses of the local
bureaucracy partly explain weak local tax effort. In particular, the structure of revenue
responsibilities score low on autonomy and incentives born by horizontal assignments. The LGC
limits the power of local governments to set tax rates by: (i) fixing the tax rate of some taxes like
the community tax; (ii) setting limits on the tax rates of the rest; and (iii) mandating that tax rates
can be adjusted only once every 5 years and by no more than 10 percent (Manasan, 2004:20). The
horizontal assignment of taxes across local government units also distorts collection incentives.
For example, provinces retain only 35 percent of their real property tax collections (World Bank
2004:18).
Local tax administration capacities are weak. Manasan (2004:21) notes that personnel assigned to
the tax division tend to not be technically-equipped. Very few units, for example, have certified
public accountants thereby impairing audit and assessment capabilities. The World Bank (2004:22-
8
25) finds weak administrative capacity for all major tax administration functions: registration,
collection and compliance.
Second, there is persistent lack of clarity in some expenditure assignments. This obfuscates
the division of responsibilities between central and local government and thereby potentially
blurring accountability. Manasan (2004:6) notes that the LGC allows the central government to
finance devolved public works, infrastructure projects and other programs and services provided
that these are “funded by the national government under the Annual General Appropriations Act,
other special laws, pertinent executive orders, and those wholly or partially funded from foreign
sources” and to augment the basic services and facilities provided by local government when
these are inadequate or unavailable. These provisions are utilized by Congressmen to access pork
barrel funds by “the simple act of inserting a special provision in the General Appropriations Act
which ordains that monies from such augmentation funds can only be released for projects that
are identified by members of Congress (Manasan 2004:7).”
During 1994-97, the internal budgets of the Department of Agriculture (48 percent), Department
of Health (25 percent), Department of Social Welfare and Development (22 percent) grew faster
than the internal revenue allotment (15 percent). Capuno et al. (in Manasan 2004:7) found that
agencies such as the Department of Education (DOE), Department of Health (DOH), and
Department of Public Works and Highways (DPWH) continued to spend significant amounts on
devolved activities during 1995-99.
Third, intergovernmental fiscal relations further undermine incentives for local revenue
generation. The LGC mandates that IRA transfers equal 40 percent of national tax collections
for the previous three years.2 This increased the local government share of national revenues
which averaged 13 percent of net receipts in the period 1987-1990 (Manasan 2004:26). The
share of IRA in total local government income ballooned from 36.7 percent in the pre-Code
period (1985-1991) to 65.3 percent in the post-Code period (1992-2003).
Transfers as a share of local government income are even more pronounced in provinces and
municipalities. This is not surprising given the limited own-source revenue generated by these
units where the share of IRA in total income averaged 81.3 percent and 74.1 percent,
respectively, in the post-Code period. Soriano (2005:1) notes that this ratio is probably closer to
100 percent in very poor municipalities. This was true in the case study municipalities where
IRA averaged almost 90 percent of local income during 2004-2006 (see Table 1; see Annex 5 for
additional data on revenues and expenditures for Pilar and Pio Duran). Contrary to trends in IRA
transfers observed in the late 1990s (see for example, Manasan 2004), IRA has been a stable and
reliable source of financing since 2000. Interviews in the case study sites indicate that there have
been no delays or unexpected reductions in the transfers.
The way IRA is distributed among local government units distorts incentives for
accountability to the extent that it favors units with latent taxing powers. Budget constraints
remain soft even in units which could most withstand hardened constraints. In particular, almost
a quarter of IRA is allocated to more than a hundred cities, while about one-third is shared by
2 The implementation of this provision was phased in over three years, beginning at 30 percent and rising to 40
percent in 1994.
9
about 1,500 municipalities. This means that cities, which may be assumed to have larger tax
bases than municipalities, receive more IRA rather than municipalities. Manasan (2004:36) notes
that the shares in IRA are not proportional to the cost of devolved functions born by different
levels of local government.
Table 1. Central transfers to Pilar and Pio Duran: 2004-2006 2004 2005 2006 Average
Pilar, Bohol
IRA (in M PhP) 24.9 25.9 31.5 27.4
IRA as a percentage of local income 87.1 85.2 88.2 86.8
EDF (in M PhP) 4.5 5.2 6.3 5.3
Legislator’s allocation (in M PhP) 0.7 1.7 0.8 1.0
Legislator’s allocation as a percentage of EDF 15.4 31.9 11.9 19.7
Pio Duran, Albay
IRA (in M PhP) 34.9 37.7 45.6 39.4
IRA as a percentage of local income 93.4 85.3 81.8 86.8
EDF (in M PhP) 7.0 7.5 9.1 7.9
Legislator’s allocation (in M PhP) 3.1 0.7 0.0 1.2
Legislator’s allocation as a percentage of EDF 43.8 8.6 0.0 17.5 EDF = Economic Development Fund M PhP: millions of Philippine pesos Source: EDF estimated from the Pio Duran and Pilar Statement of Income and Expenses, 2004-2006 Legislator’s allocation computed from www.dbm.gov.ph/dbm_releases/dbm_releases.htm
Specific-purpose grants or non-IRA central transfers, while constituting a relatively small
share of local revenue, account for a substantial share of local capital expenditures. This
provides further evidence of the dependence of local development financing on central transfers.
In 2003, non-IRA transfers constituted only 11 percent of total funds available for devolved
functions. However, this figure remains significant because, unlike IRA transfers, a larger portion
of non-IRA transfers are allocated for capital expenditures (rather than personnel and overhead
costs). Soriano et al. (2005:16) found that up to 89 percent of non-IRA transfers in 2003 were
spent on capital outlays compared to no more than 20 percent of IRA transfers. In absolute terms,
capital expenditures from IRA and non-IRA are roughly the same: 22.6 billion Philippines pesos
(PhP) and 28.2 billion PhP, respectively.
Congressional allocations, totaling PhP 14.9 billion, accounted for the lion’s share of non-
IRA transfers in 2003. Soriano et al. (2005:21) find that more than 95 percent of these funds
were used for capital outlays. More significantly, 70 percent of these were channeled to
municipalities. Almost the entire amount (PhP 14.5 billion) went to DPHW infrastructure projects.
Line agency funds and ODA grants, although smaller than congressional allocations, are
important sources of funds for education, agriculture and roads. Table 1 also shows that there
were years when these discretionary central transfers represented an even higher portion of
EDF—44 percent in Pio Duran in 2004 and 32 percent in Pilar in 2005. These figures show that
in the years under review, at least a fifth—in some years even more—of capital spending in the
case study sites are funded by discretionary transfers from the central government
Unlike Pio Duran, Pilar is more creative in negotiating the limits of its fiscal constraints
and is better able to align public investments with community preferences. On average,
during 2004-2006, Pilar generated 10 percent of local income from its own local resources while
Pio Duran generated only 5 percent. The business tax collected in 2006 was five times the
10
amount collected in 2004. Pilar’s municipal enterprises3 earned three times the income of those
in Pio Duran. This is partly explained by the enabled environment in Bohol, which made
possible the influx of donor-assisted funds in the province. These projects energized and trained
the local bureaucracy and exposed the municipal government to innovations in cost-sharing. In
comparison, Pio Duran’s experience with donor-assisted projects is relatively new.
Development planning is a process of surviving from project to project rather than a
coordinated means of delivering public goods. Fiscal constraints have led to the government’s
dependence on project funds. Because significant funds for development projects are barely
coordinated by the municipality and are subject to the political ties of local politicians to national
politicians, there is a strong sense that development is a byproduct of projects fortunate enough
to receive funding.
Local Fiscal Constraints
Local fiscal constraints diminish the ability of local governments to respond to citizen
demands. This may be detrimental to fostering downward accountability as citizens may judge
local governments as unable to respond to their needs and not worth engaging. Manasan (2004)
presents three trends in local government expenditure that describe the fiscal squeeze faced by
local governments.
First, although aggregate spending increased in real terms for almost all services shortly
after the devolution, spending stagnated during 1998-2001 and declined during 2001-2003. Real per capita local government spending on health declined from PhP 59 in 2003 to PhP 53 in
2007. Per capita spending on infrastructure also declined.
Second, increases in local government spending during 1991-2003 are due solely to
the increased share in health spending. The expenditure shares of education, social
welfare and housing declined. The increased share in health spending was due to local financing
of devolved health personnel. This accounted for more than half of the total cost of all devolved
personnel.
Third, expenditures in the same period are dominated by personnel services, which on
average account for half of local expenditures. Manasan (2004:17) notes that personnel costs
reported in financial statements generally tend to underestimate actual spending. In some local
government units, as much as 15-20 percent of operational expenses is paid out to contracted
personnel. Still other local governments charge some of their personnel costs against public
enterprises, such as public markets and slaughterhouses.
The fiscal squeeze this imposes is demonstrated by the case study municipalities. Table 2
shows that personal services account for a significant portion of budget appropriations, though
within statutory requirements. Note that this line item does not reflect actual personnel outlays to
the extent that hiring of some local personnel are sourced from non-cash costs (for example, the
budget for municipal enterprises). The employment of non-permanent (casual) employees
enables them to hire more personnel because this kind of employee does not receive benefits.
3 These include public markets, slaughterhouses, cemeteries and water utilities.
11
Both municipalities hire more casual employees by declaring plantilla positions “vacant” and
then hire casual employees to fill those vacancies. Table 2. Budget Appropriations of Pilar and Pio Duran: 2007
Pilar Pio Duran
Items Amount
(millions of pesos)
Share of total
(percent)
Amount (millions of
pesos)
Share of total
(percent)
Personal services 16.42 44.2 25.44 55.4
Capital outlays .56 1.5 .65 1.4
Maintenance and operating expenses 2.80 7.5 4.63 10.1
Non-office costs* 17.38 46.8 15.22 33.1
Total budget 37.16 100 45.94 100 Source: Appropriations Ordinance, Office of the Sangguniang Bayan, Pilar and Pio Duran. * Includes Calamity Fund, Economic Development Fund, Gender and Development (GAD), and subsidies to barangay and municipal enterprises.
3.1.2 Administrative Dimension
As with fiscal decentralization, formal autonomy and discretion given to local government
fosters accountability by clearly delineating what they can be held accountable for. Formal rules
defining the autonomy of local governments can be found in the 1987 Constitution, the 1991
Local Government Code (LGC) and the 1989 Organic Act for Muslim Mindanao.
Budget and Planning
Four features in local budgeting tend to make it non-transparent. First, the annual budget is
based on revenue targets that are based on rough estimates of past trends in local government
revenue generation. Cuts are made across the board and 10-15 percent reserves on appropriations
for maintenance and other operating expenses (MOOE) are made at the start of the year in
anticipation of revenue shortfalls. Second, granting additional personnel benefits out of “savings”
has led LGUs to manipulate the budget figures to generate “savings”. Third, no consideration is
given to program performance and cost-effectiveness in making budget allocations. LGUs
approach the budget in an incremental fashion after funds are set aside for mandatory expenditures
and assume that the existing funding level is appropriate. Fourth, there is limited effective
participation in the preparation and monitoring of the budget. The public usually was not invited
to budget hearings although they are officially open to the public. Public monitoring of budget
execution is not possible since the budget document and other expenditure statements are not
disseminated.
There is a weak environment for internal and external controls. In particular, LGU financial
management skills are weak, leadership is lacking, and there is weak oversight by national
government agencies. Most LGUs do not have internal auditors. The intergovernmental
oversight function follows the procedures mandated by the DILG and the Commission on Audit
(COA). Department heads and SB members meet twice a year to formulate an executive-
legislative agenda in accordance with DILG requirements. However, these meetings appear to be
pro-forma. The municipal budget is forwarded to the provincial Sangguniang Panlalawigan
which approves it after review to ensure that the budget is within allowable limits, particularly in
terms of the statutory items such as the Calamity Fund.
12
In the case study sites, the debilitating effect of the mayor’s discretionary powers on
accountability is best exemplified in the budget process. In both the enabled and constrained
municipalities, the mayor’s role was decisive in the preparation and approval of the budget for
capital and operational expenditures. The municipal budget proposed by the mayor is subject to
the approval of the SB, but no real deliberations occur in budget hearings, and the mayor’s
budget is typically passed en toto.
There is a lack of effective community participation in the preparation and monitoring of
the budget and procurement. In Pilar, there are 11 CSO representatives on the Local
Development Council (LDC), but the LDC is only presented the Annual Investment Plan (AIP)
and there are no real deliberations about the municipal priorities reflected in this plan. In Pio
Duran, the 2006 minutes of the LDC indicate that no CSOs were represented on the LDC, a fact
that is confirmed by community members interviewed. There is no community participation in
the monitoring of municipal budget implementation and procurement activities in either
municipality.
Capital expenditures are subject to only perfunctory oversight. This basically amounts to
finalizing the AIP a list of priority projects to be funded by the municipal EDF. The list is mainly
decided by the mayor with technical inputs from the Municipal Planning and Development
Officer (MPDO). On paper, there are two layers of checks and balance: (1) the LDC, which
needs to approve the AIP; and (2) the SB, which needs to approve the budget for the AIP. In both
Pio Duran and Pilar, these checks seemed to be performed only perfunctorily. The LDC meeting
is more consultative than a forum for debate and decision-making. The participation of the SB
Appropriations Committee Chairperson in the Local Finance Committee, which on paper
consolidates the municipal budget proposal, “facilitates” the smooth passage of the budget. At
the barangay level, development planning is generally interpreted as annual investment planning.
This is mainly done by the barangay council, treasurer and barangay captain with little
participation from the community.
The budget for operational expenditures—including personnel, maintenance and
operations—is supposed to be devised with inputs from municipal department heads. This
is done in Pilar. In Pio Duran, a high-ranking municipal official said that this is not regular
practice and the one time that he submitted a departmental budget for consideration, he was
disheartened because the final budget submitted by the mayor did not reflect any of his
proposals. Another official says that mayor ultimately decides on budget cuts in maintenance and
operational expenditures and there are no formal rules that form the basis for these cuts.
Human Resource Management
Local governments generally have the power to hire and promote personnel and determine
the organizational structure of the administrative branch. These powers are circumscribed
by Civil Service Commission regulations and a wage bill cap of 45-55 percent of the total local
budget. The LGC mandates that all local governments design and implement their own
organizational structure and staffing pattern taking into consideration its service requirements
and financial capability.
13
The chief executive of every LGU is responsible for human resource management in his unit in
accordance with the Constitutional provisions on civil service, pertinent laws, and rules and
regulations. The local chief executive (LCE) has the power to employ emergency or casual (non-
permanent) employees for a period of six months paid on a daily wage or piecework basis and
hired through job orders for local projects authorized by the Sanggunian without Civil Service
Commission approval. The LGC mandates the LCE to establish a personnel selection board to
assist the LCE. A Civil Service Commission representative is supposed to sit on this board as an
ex officio member.
Obstacles to a merit-based system limit the accountability and transparency of the local
bureaucracy. Local governments have found ways to circumvent regulations on hiring, firing
and the wage bill. LGUs opt not to fill mandatory devolved positions to create fiscal surpluses
deployed elsewhere. In some cases, local governments hire temporary “consultants” to fill civil
service positions quickly and with minimal bureaucratic intervention (Azfar et al. 2001).
Interviews at the case study sites indicate that personnel hiring is highly politicized and many
casual employees are employed.
The employment of a substantial number of casual employees has significant consequences
on the quality of human resources. None of these casual employees are subjected to periodic
professional performance evaluation nor benefit from training. Moreover, the municipal
treasurers in both municipalities recognize that the hiring of casuals may have serious
implications for accountability systems. For example, casual employees have responsibility for
“accountable forms” like fee collection receipts.
The relatively better local governance conditions in Pilar are reflected by municipal
government innovations that support vertical and horizontal accountability. First,
municipal department heads meet every Monday morning to report on their activities and
achievements. These meetings are open to the public and are attended by the mayor and the SB.
They provide an opportunity to inform the public and the SB about local executive branch
activities. Second, barangay assemblies have been regularized. Some meet more than the
required twice a year. They are attended by representatives from the municipal government,
barangay officials and community members. Since 1994, municipal department heads report to
the barangay assemblies on the progress of key projects and programs. Third, Pilar began
holding SB sessions in a barangay. This was initiated by barangay officials to provide closer
links between the municipality and the barangay, and to familiarize the barangay council with
parliamentary procedures used by the SB. There have been no such innovations in Pio Duran.
Government Procurement
The enactment of the Government Procurement Reform Act (GPRA) in 2002 significantly
improved the legal framework for procurement. The LGC was passed when no unified
framework was available and procurement was governed by 60 laws, presidential decrees,
executive orders, and issuances from line agencies. This led to confusion, as each autonomous
LGU adopted its own procurement rules. This resulted in inefficient procurement and
susceptibility to corruption. From the perspective of this study, the most important features of the
GPRA and its rules and guidelines are: (1) reorganizing and strengthening agency and LGU Bid
14
and Award Committee (BAC) and procurement units to ensure accountability in procurement
processes, including prohibiting the local chief executive from being the Chairman of the BAC;
(2) minimizing anomalous procurement practices such as rigged bidding, fake advertising
notices, misrepresentations in bid proposals, and irregularities in bid evaluation, inspection and
contract implementation; (3) strengthening rewards and sanctions in procurement performance;
(4) establishing an appropriate complaints mechanism; and (5) strengthening CSO involvement
in policy formulation and reform implementation (WB 2005:33-34).
Implementation is still in its infancy and administration is still weak. In particular, the
following need to be monitored: (1) reports that congressional initiatives and pork barrel
spending in district-level projects tend to be non-transparent as some officials are reported to pre-
determine winning contractors; (2) dissemination of information regarding the implementation of
the procurement act among stakeholders; and (3) capacity building for BAC members as they
lack experience and capacity in dealing with procurement (WB 2005:35-36). The third point was
reflected in the case study sites where civil society groups do not participate in the Pre-
Qualifications Bids and Awards Committee (PBAC). Officials at the municipal hall say that
these groups do not have the skills to engage in PBAC oversight functions.
3.1.3 Political Dimension
The formal political system makes locally elected officials directly accountable to their
constituencies and gives citizens the means for exacting accountability through mechanisms of
direct democracy. Extensive local elections from the barangay to the province enable citizens to
hold elected officials accountable for their choices and actions through the power of the vote.
The current electoral system involves the direct elections of not only all elective national offices
of the presidential-bicameral government, but also all elective local government offices.
In general, local government in the Philippines is composed of three levels, each of which is
autonomous (although central government institutions exercise some degree of supervision in
terms of budgeting and legislation): (1) provinces and independent cities; (2) municipalities and
component cities; and (3) barangays. Each LGU level is headed by an elected chief executive
(governor, mayor, barangay captain) and has an elected legislative body/Sanggunian (vice
governor/vice-mayor and council members). All local government officials are elected every three
years with three-term limits, except for barangay officials, who are elected every five years.
The Political Culture of Patronage
The promise of accountability embedded in the decentralized representative system and
institutions of direct democracy is stymied by anti-democratic forces. These are best
understood in the historical basis of institutions and the nature of politics. The electoral system
predates the enactment of the LGC and has roots more than a century old in the American
colonial project of self-government that had two distinct characteristics: (i) the early
consolidation of decentralized patterns of power resulting from elections at the municipal and
provincial levels pre-dating national legislature elections by almost 10 years; and (ii) the
inability to establish strong central administrative controls to discipline the emergent
decentralized patterns of power, resulting in decentralized electoral politics pre-dating
15
bureaucratic formation and presaging the weakened capacity of central structures to oversee the
decentralization process (Hutchcroft 2003).
The timing, phasing and structural design of colonial electoral politics left indelible imprints on
the character of the Philippine polity, particularly explaining the entrenchment of local political
elites—especially those who are able to develop strong links with central powers. Sidel and
Hedman (2001) contend that the historical roots of the Philippine state facilitated the emergence
of local bosses who have used their power and discretion over state resources to maximize
opportunities for private capital accumulation.
The early consolidation of local political power pre-figures what Sidel and Hedman (2001)
describe as “a pattern of political competition in which local, particularistic, patronage-based
concerns and networks would serve as the building blocks of electoral competition.” Hutchcroft
(2001) argues that national electoral politics works through patron-client networks from
barangay village leaders to municipal mayors, provincial governors, congressmen and the
president. In these networks, central-local relations are marked by the delivery of local votes in
exchange for clientelistic largesse once state power is secured by the elite. These networks took
the place of political parties as the electoral-organizational base, and the place of policy
platforms as the currency for political exchange. This tends to systematically weaken political
accountability: by narrowing the range of constituents to whom politicians are responsive and
creating disincentives for groups to develop collective forms of representation, thereby further
weakening interest group competition (Campos and Hellman 2005).
The discretionary powers of the president are mirrored in the powers held by the local
chief executives. Governors and mayors likewise hold the power to suspend mayors and
barangay captains, respectively, directly under their jurisdiction. Like the president, they also
have significant powers to appoint the local bureaucracy. For example, in both case study
municipalities, although elections take place regularly, they struggle against the worst aspects of
traditional politics including political contests centered on a limited number of families and vote-
buying during elections. In both areas, politics is still largely personality-driven. Accountability
is not part of election season discourse. In the most recent elections, interviews with community
members in both municipalities indicate there was vote-buying. In this context, political parties
are nothing more than election machines necessary for mobilizing resources for the election
campaign. In exchange for providing the local machinery that will ensure that votes for national
candidates are delivered, those aligned with parties in power are given easy access to
discretionary central transfers. Links with the congressman and provincial governor are the main
conduits for these transfers.
At the national level, strong executive powers tend to foster loyalty of local officials to
central powers. Two aspects of executive privilege underpin the strength of an incumbent
president’s hold on local elected leaders. First, the LGC mandates the president with the power
to issue administrative suspension orders on governors and mayors of component cities based on
loosely worded grounds including “disloyalty to the constitution”, “dishonesty, oppression,
misconduct in office, gross negligence and dereliction of duty” and “moral turpitude and abuse
of authority.” Second, the president’s control over government finances is extensive. Of
particular importance is the fact that releases of congressional insertions into the national
16
budget—including discretionary pork barrel funds allocated to members of the legislative
branch—need the authority of the president to be disbursed. Such powers of the president
explain why, soon after every presidential election, members of opposition parties gravitate to
the party of the President (Rocamora 1998:4).
The case studies offer interesting snapshots of how pork barrel politics operate. This study
finds that the political alignment with the provincial and national government proved crucial in
obtaining resources for the municipality, with the more enabled municipality doing a better job
than the constrained one. Pilar has benefited from the strong links between the provincial
governor and the President. The governor is the head of the highly influential Union of Local
Authorities in the Philippines (ULAP) which supported the President when she was threatened
with impeachment in 2006. The mayor of Pilar is known as an ally of the governor and is said to
be part of the group of mayors who strongly supported the governor during the election.
In contrast, the provincial governor in Pio Duran aligned with the incumbent mayor lost
his re-election bid in 2007. The incumbent governor was the district congressman and belongs
to a different party, and at the time he was congressman, Pio Duran notably received less
discretionary congressional funds (i.e. PDAF and DPWH transfers) than the other municipalities
in the district, a fact that highlights the latitude of political discretion for this type of central
transfer. It is unclear how this will play out in terms of provincial transfers now that the mayor
belongs to a different party than the governor.
3.2 Demand-side Conditions
On the demand-side, the strength of the Philippine institutional environment is the constitutional
provisions for the exercise of voice, negotiation and oversight by civil society in local
governance processes. However, the opportunities for fostering downward accountability are
mitigated by persistent, localized threats to associational autonomy and press freedom, the de
facto lack of access to public information, and weak technical capacities of civil society. As with
the discussion on supply-side conditions, this section first highlights the opportunities afforded
by the legal framework and then itemizes the political and technical constraints.
3.2.1 Association
Strong constitutional provisions for the right of association and the undemanding requirements
for registering associations anchor a robust legal framework for civil society organizing,
necessary for fostering downward accountability. The legal framework for associational
autonomy is enshrined in 1987 Constitution (see Box 1 for details) and provides the context for
the blossoming of civil society since the ouster of President Ferdinand Marcos in 1986.
Principles enshrined in this constitution reflect the changing circumstances that civil society
actors face in the transition from authoritarianism to democracy.
Box 1. Constitutional Provisions Ensuring Rights of Association, Voice and Access to Information
The 1987 Constitution articulates a fully-elaborated framework for the recognition of associational
autonomy and the role of civil society in a democratic society, the public’s right to information, and the
exercise of voice through the enrichment of representative structures of direct democracy. Among the
17
salient features of the 1987 Constitution are the following:
Article II, on state principles and policies, enables the exercise of voice, associational autonomy and
access to information. It guarantees full respect for human rights; recognizes the role of youth and women
in nation-building; affirms labor as a primary social economic force and guarantees protection of their
rights and welfare; recognizes and promotes the rights of indigenous peoples; encourages non-
governmental, community-based and sectoral organizations that promote national welfare; ensures the
autonomy of local government; and guarantees to adopt and implement a policy of full public disclosure of
transactions involving the public interest.
Article III, the bill of rights, recognizes the right of people to information on matters of pubic concern, to
form unions and associations, and guarantees that no person shall be persecuted on account of his
political beliefs.
Article VI, on the legislative department, specifies that legislative power is not solely vested in Congress,
but also in “the people” through the provisions on initiative and referendum.
Article X, on local government, not only instructs Congress to enact a local government code, but also
articulates provisions for direct democracy mechanisms and enhancements to the representative system. It
provides that the decentralized local government structure should include mechanisms for recall, initiative
and referendum. It mandates a law that will enable the creation of local legislative bodies with sectoral
representation. The article also instructs the President to constitute regional development councils—
composed of local government officials, regional heads of departments and other government offices, and
representatives from NGOs in the regions—to achieve administrative decentralization to strengthen the
autonomy of LGUs, and to accelerate the economic and social development of regional units.
Article XII, on social justice and human rights, has a subsection devoted to the role and rights of peoples’
organizations as vehicles for the citizenry to pursue and protect collective interests through peaceful and
lawful means. It also recognizes their participation in decision-making and guarantees that the State will
facilitate the establishment of consultative mechanisms.
Brillantes (in Hutchcroft 2003:18) attributes the explosive growth of NGO activity in the late
Marcos years, continuing into the post-Marcos years, to the 1987 Constitution and the “anti-
authoritarian instincts of the Aquino administration which encouraged the bias for NGOs.” In
1986, more than 27,000 NGOs were registered with the Security and Exchange Commission.
This number doubled to 50,800 in 1992 and to an estimated 95,000 by 2003, with 7,000 NGOs at
the grassroots level.
However, the failure of the state to establish the rule of law and continuing threats to
associational autonomy limit the capacity and opportunity for civil society to play its role
effectively. For example, unresolved cases of illegal detention and torture, abductions and
killings of community leaders, mostly occur outside Metro Manila and in regions where
government forces are engaged in conflict with armed opposition groups. Such cases tend to create
an atmosphere of fear. This partly explains the concentration of NGOs in Metro Manila and other
more progressive urban centers in the country. For example, DILG officials observe that the
implementation of the NGO accreditation process is hindered by the limited presence of CSOs,
especially in some remote rural areas.
18
Philip Alston—Special Rapporteur on extrajudicial, summary or arbitrary executions—
conducted a February 2007 review of the Philippine situation covering the previous six years. He
indicates that the majority of the cases were perpetrated by state agents. Alston is hesitant to state
the number of these illegal executions, ranging from 100 to 800 in the past six years, as statistical
sources are understandably unreliable and scarce. But the preliminary report finds the government
response deficient.
Context-specific factors explain why the environment for association seems more conducive
in Pilar than in Pio Duran. The rough terrain in Pio Duran makes community organizing more
difficult and tends to isolate barangays from one another. The presence of insurgent groups also
complicates organizing in Pio Duran. The insurgency has been more successfully suppressed in
Pilar, where the last of the skirmishes was in the late 1990s. The province-wide anti-insurgency
drive, centered on facilitating the inflow of development funds from foreign donors and central
agencies, has proven successful in Pilar. In contrast, in Pio Duran, the mayor was ambushed in
2007, and there is speculation that insurgents may have been involved. Some community
members are wary that any initiative to organize might be misconstrued as support of insurgents.
As a result, it is church-based groups that have the most extensive networks in both
municipalities.
In Pilar, longer experience in implementing donor-assisted projects facilitates positive
interaction between the municipal government, barangays and CBOs. In Pilar, the
municipality is already following the NGO accreditation process prescribed by the DILG,
something that is yet to be done in Pio Duran. The relationship between the government and civil
society has evolved to the point that the mayor allocates a portion of his office’s budget to
farmers and women’s organizations. The MPDO says that the local government sees peoples’
organizations as extension workers and the assistance ensures that the organizations are able to
develop their action plans for the implementation of LGU programs.
3.2.2 Access to Information
Although the Philippines has fully-fleshed out constitutional provisions for the right to
information, the absence of a right to information act has meant that the legal framework to this
right is provided by other means.
First, the Code of Conduct and Ethical Standards for Public Officials and Employees
mandates that all public officials provide information on their policies and procedures. It
ensures openness of information unless otherwise provided by law and when required by the
public interest. This law (RA 6713) specifies the date by which annual performance reports are
to be released and public requests are to be acted upon, requires that public documents be readily
accessible for inspection by the public, and obligates public officials (except honorary, casual
and temporary employees) to report (within specified time frames) notarized declarations of their
assets, liabilities and net worth along with the business and financial interests of their spouses
and children under 18 living with them and to make related documents available to the public.
Second, the Supreme Court makes rulings on what constitutes information that are public
in nature. Supreme Court rulings in favor of the disclosure of party list nominees and against
19
provisions in Executive Order 464 that prohibit executive branch officials from appearing before
legislative-sponsored hearings without the prior consent of their superiors are seen as supporting
the constitutional right to information.
Third, administrative orders classify documents as public or instruct public agencies on
ways to disclose public information. President Corazon Aquino, for example, issued an
executive order that ordered the publication of all laws in general circulation newspapers in
1986. In 1993, President Fidel Ramos issued an executive order requiring national government
agencies to adopt procedures that they can follow in response to public requests for information.
Finally, the 1991 LGC contains important provisions that compel local government to
provide information to the public. It requires posting notices in “conspicuous” places in the
locality of publication in local newspapers (see Box 2 for the specific provisions).
Box 2. Local Government Code Provisions on Access to Information
The 1991 Local Government Code contains important provisions that compel local government to
provide information to the public through posting notices in conspicuous places such as publication in
local newspapers. These provisions include the following:
Section 37c mandates posting all minutes of all meetings of the local PBAC in “a prominent place”.
Section 59 requires the posting of all ordinances and resolution “on a bulletin board at the entrance of
the provincial capital or city, municipal or Barangay hall, as the case may be and in at least two other
conspicuous places in the local government unit.” This section further provides that the text of the
ordinance or resolution should be disseminated in Filipino or English and the dialect or language
understood by majority of the local population. It also requires that ordinances with penal sanctions
shall be published in a general circulation newspaper within the relevant province, while the gist and
main features of ordinances or resolutions enacted in highly urbanized cities shall be published in a
general circulation newspaper.
Section 188 requires the publication of tax ordinances and revenue measures within ten days of
approval either in a local newspaper or at least two conspicuous public places.
Section 316 mandates the Local Finance Committee to conduct a semi-annual review of costs and
achievements against performance standards applied in undertaking development projects. A copy of
this report is to be posted in conspicuous and publicly accessible places in the barangay.
Section 352 requires local treasurers, accountants, budget officers and other accountable officers to
post in three publicly accessible and conspicuous places, within thirty days of the end of each fiscal
year, a summary of all revenues collected and funds received, including the appropriation and
disbursement of these funds.
Section 363 requires the publication of calls for bids in at least three publicly accessible and
conspicuous places in the barangay, and their circulation, to any known prospective participant in the
bidding process. It requires that the results of the bidding process be similarly published.
Section 513 specifies sanctions for the failure by the local treasurer or the local chief accountant to
post in prominent places in the main office building of the local government concerned or, where
available, in a general circulation newspaper, itemized monthly collections and disbursements.
20
Advocates for freedom of information find this framework insufficient. The absence of right
to information legislation, along with public attitudes about demanding information, serves as a
constraint for the full elaboration of the right of access to information, and diminishes the space
for nurturing accountability.
First, the right to information is not absolute and is subject to the interpretation of what
constitutes information that is of public concern. It is also subject to record custodians’
decisions to define “reasonable regulation of access.” There are various other restrictions
including access to information that would impinge on the right to privacy (for example, birth
and adoption records), legislative proceedings on matters of national security, court documents
related to witness protection, and trade secrets. All bank deposits and investments in government
bonds are confidential except in cases of impeachment or upon order of a competent court in
cases of bribery or dereliction of duty by public officials. Aspects of the investigation of civil
servants are shrouded in secrecy. For example, the Office of the Ombudsman can determine
which cases may not be made public (Chua 2003:130-132).
To make the right to information less discretionary and more predictable, the NGO Access to
Information Network (ATIN) opines that legislation is required to clarify exemptions to the right
to information. It finds the recourse of going to court to compel access problematic, especially in
cases where media requests for information may be irrelevant by the time the courts order its
release (CMFR 2006: 27).
Second, compliance with LGC provisions compelling local governments to publicly post
relevant information is not strictly monitored. For example, in the case study sites, annual
budgets were not posted in conspicuous sites. In both municipalities, key municipal information
like the municipal budget, procurement activities and development plans are not systematically
distributed. Instead, informal sources are the important sources of information (e.g., relatives or
neighbors working in the municipality, as well as barangay officials). The only significant
difference, aside from the relatively regular barangay assemblies in Pilar, is that Pilar at least has
a public information officer (PIO). However, this official also holds other functions, making it
impossible to fulfill his functions as the PIO. When asked how he performs his PIO functions, he
says it is primarily through attending barangay assemblies.
Barangay Assemblies are proving to be an important node for consultation and local government
reporting—more in Pilar, where they are relatively more regularized, than in Pio Duran. But the
communication seems to be one-way. There is no evidence that these meetings are being used as
a means of providing feedback on local government action.
The larger problem is the absence of a cultural predisposition for the right to information. Advocacy remains limited to the media and organized groups. The problem of ordinary citizens,
for example, is as basic as access to official personal documents and the prevailing culture is that
they are not entitled to such access. Meanwhile, the default attitude of public officials is also not
predisposed to ease of access, although internet-based information systems have made some
headway in modernizing the infrastructure for public information.
21
3.2.3 Voice, Negotiation and Oversight
As with associational autonomy, the Philippines has a fully elaborated legal framework for the
establishment of institutions of direct democracy and enhancements to representative institutions.
This framework includes:
the constitutional guarantee of freedom from persecution based on political beliefs and
freedom of expression enshrined in a Bill of Rights (see Box 1 for the relevant
constitutional provisions);
the granting of legislative powers to citizens through LGC provisions for referendum,
initiative and recall and a separate law called the Referendum and Initiative Act (RA
6735) (see Box 3 for details); and
the establishment of a party list system and local sectoral representation (see Box 4 for a
summary of the relevant legal provisions).
Box 3. Legislation on Mechanisms of Direct Democracy: Referendum, Initiative and Recall
Referendum and initiative. RA 6735 was passed in 1989 and allows people to: (i) initiate proposals to
amend the constitution or to enact or amend laws through an election called for that purpose, (ii)
approve or reject legislation through an election called for that purpose, and (iii) exercise “indirect
initiative” whereby accredited peoples’ organizations may file a petition, which will take precedence
over all other pending legislative measures before the committee, that is, the bill will be prioritized
although the people may not take part in legislative debates on the bill.
Chapter II, sections 120 to 127 of the LGC, also enable direct legislation. Citizens can exercise an
initiative (by 1000 registered voters in provinces and cities, 100 in municipalities, or 50 in barangays) by
filing a petition with the local Sanggunian (legislature) proposing adoption, enactment, repeal or
amendment of an ordinance. Registered voters may also directly approve, amend or reject any ordinance
enacted by the Sanggunian through a local referendum, which the LGC mandates shall be held under
the control and direction of the Commission on Elections (COMELEC) within 60 days in provinces and
cities, 45 days in municipalities and 30 days in barangays.
Recall. Chapter 5, Sections 69 to 75 of the 1991 LGC, provide the means for the people to terminate
tenure by popular vote through two modes of recall: (i) recall initiated by registered voters through a
petition signed by at least 25 percent of the voters and filed with COMELEC; and (ii) recall initiated
through a Preparatory Recall Assembly (PRA), comprised of elective officials in a given locality, with
the majority of the PRA adopting a resolution for the recall of provincial, city or municipal officials.
Box 4. Legislation Enhancing Representative Institutions
Party list system. The Party List System Act (RA 7941), enacted in 1995, enables a system of proportional
representation, whereby parties who garner at least 2 percent of the total votes cast obtain one seat in the
House of Representatives. The law enables citizens belonging to underrepresented sectors, organizations
and parties—who lack the well-defined constituencies that district representatives have—to obtain seats in
Congress, 20 percent of which are mandated by party list representatives.
Local sectoral representation. The LGC provides for local sectoral representation in the Sanggunian
at all local levels of government, where three seats are reserved for representatives of marginal sectors:
one for women, one for labor and the third from a sector to be determined by the Sanggunian.
22
The exercise of voice, negotiation and oversight is encouraged at the local level by LGC
provisions of that LGC that mandate the formation of local special bodies with significant civil
society representation and responsible for formulating policy recommendations, devising
developmental and sectoral plans and proposing measures that will guide the Sanggunian (see
Box 5 for details). On paper, the required participation of civil society formations in these bodies
enables these groups to influence the direction of capital investments at the local level, multi-
year development plans, the way in which schools are managed, and the shape of local policies
in health and peace and security. It also guarantees the exercise of civil society oversight in local
government procurement. Despite these measures, institutions of direct democracy are unable to
countervene the weaknesses of the representative system either because they are operationally
toothless or have been mainly used by entrenched political interests to advance their own
interests.
Box 5. LGC-Mandated Local Special Bodies
The LGC mandates the formation of local special bodies—which formulate policy recommendations,
devise development and sectoral plans, and propose measures that will guide the Sanggunian—with
provisions for significant civil society representation. They include, but are not limited to the following:
Local Health Board. The local health board proposes budgetary allocations for health programs to the
Sanggunian, serves as an advisory committee, and sets technical and administrative standards for health.
One seat on the board is allocated to a health NGO or private sector representative.
Local School Board. The local school board is an advisory committee on educational matters, determines
the supplementary budget for school maintenance, and authorizes disbursement of that budget. Three
representatives from NGOs or the private sector sit on the board—one from the local parents-teachers
association, one from the local teachers’ organization, and one from the organization of public school
non-academic personnel.
Local Peace and Order Council (POC). The POC assesses the peace and order situation, and formulates,
monitors, and implements plans and programs to improve peace, order and public safety. Three
representatives of the private sector—representing academic, civic, religious, youth, labor, legal, business
and media organizations—are appointed by the chairman of the board in consultation with POC
members.
Local Pre-Qualification Bids and Awards Committee. This committee decides on bids and awards for
local infrastructure projects, although its jurisdiction does not include procurement of supplies, office
equipment, renovations, or other local government expenditures. Two NGO and PO representatives
seated on the Local Development Council (LDC) also sit on this committee. The committee also includes
a certified public accountant from the private sector designated by the local chapter of the Philippine
Institute of Certified Public Accountants.
Local Development Council. The LDC initiates and proposes a comprehensive multi-sector five-year
development plan to be approved by the Sanggunian, formulates public investment programs and
incentives to promote the inflow of investment capital, and coordinates, monitors and evaluates the
implementation of development programs and projects. The LDC may also form sectoral or functional
committees to assist them. No less than 25 percent of the LDC is to be constituted by accredited NGOs,
peoples’ organizations or private sector representatives.
23
Three attempts at implementing initiatives at the national level have failed. The first was the
People’s Agrarian Reform Law. The second was an attempt to initiate constitutional change in
1997. The Supreme Court ruled against the petition on the grounds that RA 6735 did not allow
constitutional change through peoples initiatives, no budgetary provisions were appropriated by
Congress for the initiative, and the petition was for a revision and not an amendment of the
Constitution. The third attempt was an effort to change the Constitution in 2006. In this case, the
Supreme Court again ruled against the petitioners saying that the initiative was void and
unconstitutional because “an initiative that gathers signatures from the people without first
showing to the people the full text of the proposed amendments is most likely a deception, and can
operate as a gigantic fraud on the people (Salazar 2006).” Of these attempts, the last two were
widely perceived as attempts by incumbent administrations to take advantage of the law to push
their own interest, staying in power.
Romero (in Iszatt 2004) finds that there has also been no progress at the local level in terms
of referendum and recall. He finds the implementing procedures cumbersome and initiatives
taken in the name of people, NGOs and POs are not genuine. Iszatt (2002) observes that
legislation for recall has not been used mainly by NGOs and POs, but is concerned that the
provision may be abused by local particularistic interests because of the loose grounds on which
a recall may be initiated and the relative ease of manipulating the process because of the PRA
provision which is not direct recall in the strictest sense.
Operational problems plague the party list system and local sectoral representation. These
include: (i) low voter awareness of the system (in 2004, only 23 percent of the voters cast a
ballot for the party list system); (ii) problems with the mathematical allocation of seats, which
make it impossible for party list representatives to fill the 20 percent membership quota; and (iii)
the use of the system by entrenched traditional political groups, most pronounced in the 2007
elections when the administration is said to have fielded parties that represent marginalized
groups in name only but whose representatives have direct links with the administration or are
their relatives. No enabling law has been passed to enact local sector representation despite
active lobbying by NGO networks like the Local Governance Policy Forum (LGPF) and
Taskforce LSR and because of the lack of political will by national government executive and
legislative bodies.
A number of studies reveal the operational difficulties of establishing local special bodies. For example, Azfar et al. (2000) estimate that only 30-50 percent of local governments have
local development councils in place and less than one-third of local governments had
development plans with meaningful civil society participation (GOLD 2002 in World Bank,
2004:29). Gabito (2001) estimates that only 56 percent of local special bodies has been
convened and that 33 percent of CSO representatives were either appointed or selected by the
local chief executive.
A DILG study found that LDCs have many operational problems. After reviewing people’s
participation in LDCs, it found: (i) NGO representatives constitute a minority in the council,
diluting their power in the executive committee; (ii) the council has too many members and
members often lack technical expertise; (iii) political interference in the accreditation process,
poor turnout of NGOs, few NGO networks, and poor representation of marginalized groups; (iv)
lack of LDC member awareness of their functions, poorly developed project monitoring and
24
investment promotion functions, and inability to integrate sectoral issues; (v) no fundraising by
LDCs and inadequate funds for proposed activities; and (vi) no prescribed procedures, poor
attendance of NGOs, and lack of a quorum.
DILG officials indicate that among local special bodies, only LDCs and local school boards tend
to operate at the municipal level. Local special bodies are operational because they have a
budget. They decide on the use of the Special Education Fund (SEF) generated by a 1 percent tax
on real property. LDCs are convened to pass the AIP, necessary to obtain the IRA.
In the case study sites, local special bodies mandated by the LGC are far from fully
activated. In Pilar, institutional spaces for citizens’ participation are relatively more developed,
particularly the LDC and the Local School Board. CSOs, identified through the accreditation
process take part in LDC meetings although their participation is more consultative than
decisive. Aside from the LDC, the most active local special body with civil society participation
is the Local School Board, where CSO participation is through the Parent-Teachers Association.
As in the LDC, the quality of participation seems questionable as well. In an interview with
community members of one barangay, the allocation of the Special Education Fund (SEF) in
Pilar is said to have been concentrated in educational facilities close to the municipal center,
therefore raising doubts about whether CSO representation in the SEF is making a difference in
terms of reducing elite capture. Besides the LDC and the Local School Board, no other special
body seems to be operational and the government has no stated plans to activate any of these.
In Pio Duran, none of the Local Special Bodies seem to be operational at either the
municipal or the barangay level. The minutes of the 2006 LDC reveal that civil society
organizations were not represented, a fact confirmed by community interviews. Even where
institutional spaces are at least opened up to citizens’ participation, their role as social
accountability mechanisms remains relatively weak. Their relative ineffectiveness as social
accountability fora is a function of the weakness of community voice and the contrasting strength
of executive power in these spaces.
The absence of meaningful CSO participation in LDCs and other LSBs can be seen as both
the cause and effect of weak access to municipal government information. Because CSO
participation in LSBs is mainly consultative, incentives for understanding the budget are
weakened. CSO participation is ineffective and demand for opening up these spaces is weak
because of poor understanding of government information.
In both municipalities, civil society’s capacity for both negotiation and oversight is
uniformly weak and limited. There are no meaningful spaces, beyond those offered by CDD
project operations, for the exercise of either function. For example, there is no participation of
NGOs or POs in Pre-Qualification Bids and Awards Committees (PBAC). As a result, relevant
skills are still in the process of being developed. With both the budget and procurement
processes remaining closed, CSOs have no institutional hooks to latch on to.
Weak oversight is also due to CSO priorities. In Pilar, the development of capacity for voice
beyond preference articulation is limited by the nature of relations between the municipal
government and CBOs—i.e., the latter view themselves as beneficiaries of government-
25
sponsored projects. This weakens their monitoring and evaluation of government performance
because CBOs are worried that performing oversight functions might threaten their access to
municipal resources. CSOs in Pilar have not performed oversight functions because they are still
focused on project implementation. Given their vested interests, CSOs lack the impartiality
necessary to be effective at oversight.
Political constraints tell only half the story; the other half is the capacity constraints of civil
society groups. This is most telling in the case study sites where civil society organizing is just
beginning. While NGOs have built up considerable capacity on a wide range of development
issues (e.g., microfinance, gender and development; community work, and corporate social
responsibility), their capacity in engaging in more technical aspects of governance is weaker.
This partly reflects a lack of space offered by national government agencies in engaging in
constructive dialog with CSOs but it also reflects a challenge that the NGO movement faces in
terms of (a) developing the necessary technical capacities to actively participate in key functions
of government such as national budget scrutiny or the public procurement process; and (b)
moving beyond the significant historical experience of being part of the political opposition
movement (Annex 8 provides some examples of NGO work in this area).
There is no community or CSO participation in procurement due to lack of capacity. At the
municipal level, the Bids and Awards Committee (BAC) is composed of local government
personnel. The BAC invited provincial representatives but none responded. The MPDO believes
that there are no CSOs in Pio Duran who have the capacity to participate effectively in BAC
activities. There are no BACs in any of the barangays in Pio Duran.
The difficulty of developing civil society capacity for social accountability is intimately linked
with problems related to municipal government information. Because participation in activated
bodies is consultative rather than decisive, incentives for understanding the budget is weakened.
But it is also because understanding of government information and processes is weak, that CSO
participation in these spaces is ineffective and partly explains weak demand for the further
opening up of these spaces.
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4. Accountable Local Governance and CDD Operations
CDD interventions at the local level are both limited by, but also helping change, local
governance conditions. This study finds that supply-side conditions for local governance and
accountability affect CDD operations in two distinct ways: first, by compromising the
environment for making local service delivery work for the poor; and second, constraining the
possibilities of sustaining the participatory governance innovations introduced by CDD
operations. Meanwhile, demand side-conditions for local governance affect CDD operations the
same way that supply-side conditions do: by imposing limits on the possibilities for
sustainability and institutionalization of governance reforms introduced by CDD and by
imposing constraints on CDD processes and project implementation. The first half of this section
elaborates these themes.
The second half of this section is concerned with how CDD interventions are helping promote
accountability and good local governance. CDD projects embody social technologies for
delivering local public goods that bring together local governments and communities in co-
production and co-financing arrangements. Thus, they do not just provide local governments
with the means to deliver public goods but also introduce them to new norms in the delivery of
these goods—norms that give priority to the voice and participation of communities in all stages
of project implementation. How effectively such norms have influenced conditions for local
governance and accountability is explored in the last part of this section (see Annex 6 for a table
summarizing local governance conditions and their interactions with CDD operations).
4.1 Impact of Local Governance Conditions on CDD Operations
The two supply-side local governance conditions that have a direct impact on CDD operations
are tight fiscal conditions and unchecked executive powers. On the demand side, conditions
related to voice and association—particularly the technical and political capacity of civil
society—is proving to have a considerable impact on CDD operations.
4.1.1 The Impact of Supply-side Conditions
Tight Fiscal Conditions
Tight fiscal conditions—characterized by a dependence on unconditional central transfers and
limited capacity for capital expenditures—constrain local government capacity to raise
counterpart funds and, more broadly, to align local budgets with the demands of the poor. In Pio
Duran, the KCP counterpart is financed by re-allocations of the budget: in 2006, by expropriating
a portion of the Calamity Fund; and in 2007, by utilizing unused balances of the previous fiscal
year. This means that counterpart funds effectively compete with other potential uses of scarce
municipal resources. This is not necessarily bad because these counterpart municipal funds are at
least used for financing public services expressly chosen by barangays. But the use of the
Calamity Fund as counterpart funds, for example, is problematic in a place like Pio Duran where
natural calamities are frequent.
27
The limited control of municipal governments over discretionary central transfers and the
constrained capacity to generate own resource revenues weaken the incentives for citizens'
participation in governance. This could very well be the most serious challenge to instituting
voice and participatory project management mechanisms beyond CDD operations and into local
governance processes.
While CDD project funds facilitate the mobilization of communities for barangay assemblies and
the establishment of community-level participatory management, monitoring and oversight
structures, the tight municipal fiscal space put municipal and barangay funds largely beyond
community control. For example, this is probably why there is no evidence that CDD operations
are leading to the activation of local special bodies with meaningful CSO participation. In turn,
with no municipal processes or bodies to latch on to, innovations in project implementation and
governance introduced by CDD operations remain in a “project bubble” and are unable to
influence local governance practice as verified by CDD project staff in both case study sites.
Parallel governance structures for CDD sub-project identification, implementation, monitoring
and procurement are not easily mainstreamed into local governance praxis.
The constrained fiscal space also poses difficulties on the possibilities for operating, maintaining
and expanding services initially delivered with CDD project support. In the case study sites, this
is evident for livelihood training centers established with KCP support. Neither the municipal
government nor the relevant barangay government officials were able to answer how the
facilities will be maintained—or indeed if a market study has been made relevant to the
livelihood projects being envisioned—once KCP funds end.
Pilar’s innovations in dealing with tight fiscal conditions have important consequences for CDD
operations. In particular, it has coped with tight fiscal conditions by leveraging its investment
capacity through the promotion of cost sharing arrangements with barangays, the congressman,
the governor, and international donor agencies. The practice of cost sharing was introduced only
recently through ODA-funded projects in agrarian reform but has since been regularized and
extended to health programs, a partnership with a local NGO and the WB-assisted CDD projects.
This is as an example of how the constraints imposed by macro-level institutional environment
can be overcome through local innovation.
The cost sharing scheme is operationalized in KCP operations through a covenant between the
municipality and the barangays. To provide incentives for barangays to raise counterpart funds,
the covenant guarantees that the municipal government will match the barangay counterpart and
involves an agreement among barangays that each will have a share of KCP funds in at least one
of the three cycles of the program. Box 6 describes how the use of counterpart funds in Pilar has
greatly enabled the municipal government to overcome its limited fiscal space.
On one hand, this scheme has the unfortunate effect of undermining the CDD principle of giving
priority to the barangays that need the resources most. The covenant apportions KCP funds to all
barangays, diluting the power of inter-barangay negotiations at the municipal interbarangay
forum (MIBF) to determine priorities at the municipal level. Such a scheme may well be a
necessary intermediate step to make the enactment of community prioritization processes
feasible. It demonstrates municipal commitment to opening up decision-making processes and
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heightens the stakes for participation and co-production in Pilar. The emergence of “lower
equilibrium” solutions—such as the cost sharing scheme—needs to better documented and
understood as they provide insights into what is feasible in terms of participatory governance
given the nature of constraints imposed by tight local fiscal conditions in the Philippines.
Box 6. Leveraging Local Resources: Cost Sharing in the LGU Economic Development Fund
(EDF) in Pilar, Bohol
In a typical rural municipality in the Philippines, such as Pilar, financing for development projects is
dominated by the EDF which is 20 percent of the IRA. In Pilar, this amounts to an annual allocation of
PhP 6 million. This is divided among 21 barangays with a population of about 25,000. With more than
50 percent of its barangays listed as a “high deprivation” areas (based on the Local Poverty Reduction
Action Plan 2005 survey), Pilar’s challenge is to address the severe poverty of the majority of its
population which had made Pilar a fertile ground for insurgents.
Pilar has been a recipient of projects from the Agrarian Reform Support Program (ARSP), Belgian
Integrated Agrarian Reform Support Program (BIARSP), and Philippine-Australia Technical Support on
Agrarian Reform and Rural Development (PATSARRD), which provide cost-sharing among
communities, barangays, the LGU, the provincial government, and PDAF from the Congressman. By
allocating its limited EDF to various development programs involving partnerships with NGOs, other
government agencies and foreign-donors, Pilar has been able to increase its financing for development
projects.
Cost sharing is an innovation in implementing the KCP in Pilar. A covenant, signed by municipal and
barangay governments in June 2006, automatically appropriates a portion of the LGU and barangay EDF
as the counterpart for KC-prioritized projects for a period of three years. The covenant aims to mobilize
resources from the LGU and all 21 barangays in Pilar to raise the counterpart funds for the KCP through
the creation of a municipal trust fund. The covenant calls for equal contributions of PhP 75,000 from
each barangay to be deposited in the trust fund, with a commitment from the municipality of PhP
150,000 for the first prioritized project for every barangay.
The covenant led the Pilar municipal government to generate PhP 2 million a year from 2006 to 2008 in
KCP funds that were invested in community-prioritized subprojects. This was equal to one-third of the
total EDF. This can be considered a good practice of leveraging LGU funds with donor funds in
projects that are contributing to better government processes and responsiveness. Cost sharing has the
potential to develop a multi-stakeholder approach to development programs beyond financing.
Executive Branch Dominance
A strong executive branch in the context of a political culture steeped in the practice of patronage
and prior development of administrative structures of horizontal accountability poses specific
difficulties for various aspects of project operations. Where the environment for local
governance is constrained, as in Pio Duran, this may be reflected in the powerful role the mayor
plays in inter-barangay planning and CDD project decision-making processes, even if on paper,
this role is merely to convene these processes. This creates perceptions that processes like the
MIBF are politicized. More seriously, this flags the dangers of local elite capture that serve to
undermine the redistributive goals of CDD operations.
29
Another issue that serves to highlight this point is the practice in both case study sites of
recruiting underqualified casual employees through a hiring process that is mostly based on the
mayor’s prerogatives. This not only undermines the accountability lines of the bureaucracy but
also the quality of CDD engagement with local government processes. For example, exposure to
training programs in budgeting, planning and procurement—sponsored by CDD projects—is
understandably limited to a small set of permanent municipal employees. This concentrates
acquired skills in a small section of the bureaucracy with most staff remaining untrained and
unexposed to opportunities for skills enhancements. This undermines the overall quality of local
service delivery.
4.1.2 The Impact of Demand-side Conditions
Weak Association and Voice
There is little awareness about local government action, processes and decisions, partly due
to limited access to public information. Project design should include community education
on the relationship between project processes and local government processes and the
governance implications of new approaches to the delivery of local public goods. Even in the
relatively enabled environment of Pilar, no clear links have been established between operational
Local Special Bodies at the municipal level with CDD project structures. LDC processes could
be easily linked to MIBF processes, while the Local School Board could be linked to operations
and maintenance committees in barangays with school subprojects. That link seems to be
missing.
Where local conditions hinder voice and association, as in Pio Duran, CDD operations face
credibility challenges. For example, in the relatively remote village of Barangay Panganiram, a
community which has failed to have its community proposals for KCP funding approved in all
three cycles and has not been regularly visited by elected municipal officials, community
members feel that the MIBF and its rules are stacked against them and are dominated by more
powerful barangays. Such barangays typically adopt a wait-and-see attitude and have to be
convinced that participation in CDD processes will lead to immediate changes. This also
probably explains why KCP facilitators in Pio Duran admit difficulty in mobilizing community
members to attend barangay assemblies in the early part of project implementation. The same
problems were not encountered in the relatively enabled environment of Pilar, where previous
LGU-community engagement was fostered by other donor-assisted development projects and
basic trust had been established.
The development of CBO capacity for voice beyond articulating preferences is limited by
the relationship between CBOs and the municipal government. CBOs view themselves as
beneficiaries of government projects. This belief seems to be mirrored by municipal level CSOs
that take part in planning processes (like Municipal Development Council meetings) to lobby for
government funds for their projects but express no interest in performing oversight functions.
The Pilar-based NGO, ICRAFT, is the same. Lobbying for counterpart funding and getting their
programs included in LGU programs is their main goal. According to the ICRAFT
representative, CSOs in Pilar have not yet performed oversight functions because they are still
30
focused on project implementation and community empowerment (as if oversight is not part of
community empowerment).
The disjuncture between project and LGU processes at the barangay and municipal levels
reflects the difficulty of institutionalizing these organizations and processes. The planning
and prioritization process for KCP subprojects using the MIBF and participatory situational
assessment (PSA) is parallel to the planning and budgeting process done using the MDP and AIP
process at barangay and municipal levels. LGU and barangay officials recognize the benefits of
participatory approaches in animating engagement between government and communities and in
facilitating joint decision-making. However, the short-term view of project structures and
processes prevails and its adoption in local governance is very limited. There is no CSO
participation in the municipal BAC. The BACs are not organized and decisions remain limited to
barangay captains.
The absence of a culture of public debate and consensus-building fosters competitive
behavior among barangays. For example, in Pio Duran, this sense of competition fostered self-
interested behavior in the selection of sub-projects. Community volunteers and barangay officials
in an upland barangay admitted to using this strategy in the first two cycles of the KCP. They
gave high scores to neighboring, contiguous barangays and admitted that they were not voting
based on the appropriate criteria. This explains why, for the first two cycles, projects seemed to
cluster around contiguous upland barangays and barangays near the municipal center. In turn,
this was detrimental to remote, isolated barangays who did not have the same allies as clustered
barangays. In Pilar, this problem was addressed by the cost sharing covenant, which eliminated
the need for inter-barangay negotiations as all barangays were assured of a project.
4.2. Impact of CDD Operations on Local Governance Conditions
The study finds that the impact of CDD operations on local governance conditions is context-
specific. In constrained local governance contexts, CDD operations provide a significant channel
for the poor to access public goods and for communities to exercise voice and agency. However,
it is unlikely that these innovations and reforms will be sustained or expanded beyond the CDD
project life. In an enabled local governance context, CDD operations have the potential to
influence local conditions beyond project parameters and in a much more fundamental way.
This section closes by elaborating on changes brought about by CDD operations—some of
which are common to the two contexts, some specific to the enabled context only.
4.2.1 The Impact on Supply-side Conditions
Expanding Fiscal Space and Aligning Investments with Community Preferences
The most immediate impact of CDD operations is the expansion of fiscal space. It enables
cash-strapped municipalities to implement infrastructure projects they could not afford on their
own. In both constrained and enabled municipalities, community members are quick to point out
the various ways these infrastructure projects have improved their lives: farm-to-market roads
that enable them to bring their produce to the commercial center, school buildings for children
who used to study in dilapidated structures, communal water systems that finally provide
31
households with access to water—the list goes on. These projects do not have just welfare
implications on households that benefit from them. The municipalities reap external benefits
brought about by these projects including enhanced tax bases due to increased economic
productivity, and help ease peace and order concerns as remote communities become more
accessible and feel more included in development efforts.
CDD operations, in that they encourage municipal and barangay cost sharing, also cause
the alignment of a portion of the municipal budgets with community-identified priorities. To the extent that provincial funds and legislators’ allocations are tapped as KCP and ARCDP
counterpart funds, these central transfers are effectively aligned with such priorities as well—an
improvement from being based purely on political discretion. Pilar’s innovations in cost sharing
show how discretionary central transfers, and significant portions of the barangay and municipal
IRA, may be pooled and apportioned based on community demands. If discretionary central
transfers could be channeled through such a mechanism, then a significant source of financing
for capital spending will be brought closer to the control and priorities of municipalities. This is
an example of a local innovation, spurred partly by CDD operations, that needs to be supported
by national rules so that it could be institutionalized and mainstreamed.
Increasing Participation and Accountability in Local Governance
CDD operations create bridges between communities and municipal and barangay
officials. Municipal department heads appreciate the effectiveness of CDD projects in mobilizing
communities and barangay officials. CDD operations strengthen accountability links between
municipal department heads and barangay officials through the MIBF. Municipal heads now
value barangay officials’ inputs to MIBF meetings when they formulate their department plans.
Through the ARCDP, the Office of the Municipal Agriculturist strengthened its links with
community-based groups.
CDD operations develop the administrative skills of municipal and barangay officials for
inclusive and transparent local governance. For example, in Pio Duran, the revised MIBF
process mobilizes the MPDO, the Municipal Social Welfare and Development Officer
(MSWDO), the Municipal Engineer and the Municipal Health Officer (MHO) on a panel that
ranks community proposals based on criteria collectively approved by the barangays. This
exposes key municipal officials to a criteria-based prioritization process in a bureaucracy
previously unexposed to bottom-up governance. The MPDO says that involvement in such
processes increased the confidence of the local bureaucracy and spurred them to bid on other
donor-assisted infrastructure projects. Barangay officials are also learning how to prioritize
projects and undertake transparent procurement.
CDD operations also contribute to the activation of barangay assemblies. In Pio Duran, KCP
and ARCDP operations led to the convening of barangay assemblies—in some barangays for the
first time. In Pilar, KCP operations have led to the regularization of barangay assemblies—in
some of them, convened more than the twice-a-year required by the DILG. These assemblies
have emerged as an important conduit for relaying municipal information to the communities.
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In the enabled environment, CDD approaches to procurement have been transferred to
LGU procedures and have increased transparency and accountability. In particular, La
Suerte’s adoption of the KCP Bids and Awards Committee as its Barangay BAC is an interesting
example of self-initiated institutionalization that deserves close observation. The La Suerte
Barangay BAC involves not only the Barangay Captain, Treasurer and Barangay SB
Appropriations Committee head, which is often the case, but also at least one community
volunteer. This committee used the KCP procurement process for a street lighting project funded
by cash transfers from the congressman (see Box 7 for details).
Box 7. Strengthening Community Oversight through CDD Projects: The Case of La Suerte, Pilar
Barangay La Suerte is an upland barangay in Pilar and ranks as the second most deprived barangay out
of 21. It ranks fifth in the number of households living below the food poverty line (63 percent) and
fifth in terms of households living below the income poverty line (73 percent).
The participatory processes introduced through the KCP are transforming the relationship between the
communities and barangay officials. Community-based associations among farmers, women and senior
citizens have become active participants in analyzing community problems and identifying which
projects in the village should be prioritized by the government.
People enthusiastically refer to the new experience of participating in the BAC for KC projects. This
new system requires that bids and awards for sub-project construction, such as waterworks or farm-to-
market roads, are done in public with the active participation of the community through representation
on the project BAC. LGU and KCP staff provide guidance on BAC rules and processes to barangay
officials and community representatives so that an informed decision can be made. Project BAC
members learn to distinguish differences in material quality and costs, undertake monitoring, and
manage the bidding process.
The proposal for a farm-to-market road which was included in the barangay priority list was approved
during the second cycle of the KCP. This project mobilized counterpart funding from the Congressman.
This provided insights on the differences in pricing between national projects and community-led search
processes. They realized that barangay-owned projects can be cheaper and prevent overpricing.
Community members contrast this process to before when barangay officials made decisions on projects
and allocation. They say that the KCP is different from other government projects. It has opened space
for the poor to participate in barangay decision-making and enables them to get support for their
projects. This participation gave them confidence in their discussions with government. The sense of
empowerment of community representatives in the KCP BAC comes from greater knowledge and
participation in project decision-making processes. The positive experience has paved the way for the
adoption of the KCP BAC as the barangay BAC.
Introducing the Discourse of Reform
There are two ways that CDD operations have proved critical in the ability of the mayors
to secure second terms after unseating local strongmen during their first terms. First, CDD
projects allowed them to take credit for securing project funds. Steeped in personality-driven
politics, the ability to deliver project funds proved a key issue in the elections. Second, CDD
project processes enabled these politicians to distinguish themselves from traditionally-minded
political leaders they unseated. In such a setting, it is not surprising to find politicians supporting
33
project processes that actually have the effect of diminishing their discretionary power to allocate
project funds. The true test is if they are going to sustain these processes once project funds run
out. Rightly or wrongly, the new projects being implemented through KCP and ARCDP are
being attributed to the “strong performance” of the incumbent mayors in Pilar and Pio Duran.
While the delivery of community-demanded infrastructure represents a limited sense of good
governance, its entry into political discourse represents progress, especially in a constrained
setting like Pio Duran, where the politics of guns and goons previously dominated the discourse.
4.2.2 The Impact on Demand-side Conditions
CDD operations are helping create and strengthen community capacity for voice. The KCP
and ARCDP provide community volunteers with training and direct experience in participatory
analysis and identification of projects that respond to the felt needs of communities. Even in
villages not prioritized by the KCP, exposure to participatory analysis is making community
members acutely aware of the gap between community needs and recent barangay priority
projects. In at least one barangay in Pio Duran, this led community volunteers to ask their
barangay captain to communicate their concerns to the municipal government.
While training in preference articulation has provided volunteers with opportunities for gaining
confidence and skills in articulating community concerns and in interacting with government,
these skills and newfound confidence have not yet been utilized beyond the project or for
reforming local governance processes such as barangay planning and budgeting. The key
question is how to sustain and use the newfound skills and confidence of community members
once CDD projects end. For example, in the exit conference in Pio Duran, a MPDO staff
member noted the energy at the community level unleashed by the KCP and how it may be
wasted once KCP funds end. While recognition of the problem is an important first step, it is
telling that the municipality view seems to be that this puzzle is for the KCP to solve rather than
an opportunity for the municipality to further stimulate community voice and initiative.
CDD operations are strengthening the capacity for voice by leading to the formation of new
project-based organizations. These include rural water system associations, farmers’
cooperatives and women’s organizations. Some of these organizations will be sustained through
their operations and maintenance functions as in the case of the Rural Waterworks and Sanitation
Association (RWSA), which generates its own funds from user fees. Other organizations,
particularly those engaged in enterprises (through the ARCDP), are expected to face difficulties
given the short time to bring the enterprises from build-up to take-off and the limited existing
capacities of these organizations.
CDD operations are having a political impact at the barangay level, particularly as they
facilitate the emergence of community volunteers as a new political force. These new leaders
claim that their confidence was developed by involvement in KC project implementation.
Evidence of their strength is that barangay officials now see volunteers as a potential challenge
to their power. Community members see volunteers as having the same legitimacy as barangay
officials. One barangay captain, who is facing term limits, says he is supporting the candidacy of
a KCP volunteer.
34
CDD projects have also contributed to increased public access to information. It created
demand for information on barangay IRA and AIP that would otherwise not have been accessed.
Moreover, CDD activities have contributed to opening up new avenues for information sharing
between municipalities and barangays through the participatory situational assessment, barangay
assemblies and the KCP MIBF.
Communities have also increasingly recognized the difference between public goods delivered
by CDD projects and those funded by PDAF and the DPWH. KCP Beneficiaries particularly
value the experience they are gaining in terms of identifying corruption in the delivery of public
good as well as training in procurement and project implementation. In Pio Duran, for example,
beneficiaries cite that while it took the KCP just PhP 1.3 million to build three new school
buildings, roofs for two school buildings cost PhP 400,000 of PDAF. While a KCProad project
cost only PhP 1.6 million for 1.2 kilometers, the DWPH spent PhP 15 million for 2.6 kilometers.
And they even saw cracks already appearing in the DWPH roads, but none in the KCP roads.
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5. Conclusions
5.1 Main Findings
5.1.1 Opportunities for Enhanced Accountability
The Philippines has a fully elaborated legal and institutional framework for accountability in
local governance (see Annex 7 for a table summarizing the main findings on how the enabling
and constraining conditions of the meso-environment affect the space for accountability in local
governance).
First, aspects of fiscal decentralization generally enhance the institutional environment for
local government accountability. Expenditure assignments are generally consistent with the
subsidiarity principle, revenue collection responsibilities are consistent with parameters of
efficiency and administrative feasibility, and central transfers are mostly formula-based
unconditional grants. All these represent a shift away from a highly-centralized fiscal regime,
thus enhancing incentives for downward accountability, which in turn heightens the stakes for
citizens to participate in local governing structures and demand accountability.
Second, accountability is also strengthened by a legal political framework that allows for
direct subnational elections from the village to the province, with all elective officials having
clear term limits. The system specifies a clear separation of powers between the legislative and
executive branches at both the national and local level. The democratic system also allows for
the exercise of direct democracy through constitutional provisions for recall, initiative and
referendum. At the local level, citizens can propose the enactment, repeal or amendment of an
ordinance as well as directly amend, reject or approve an ordinance through a referendum. The
de jure political system is one that makes locally elected officials directly accountable to their
respective constituencies and gives citizens tools for exacting accountability through
mechanisms of direct democracy.
Third, local governments have enough leeway to exercise autonomy. The LGC and the
Constitution provide a clearly elaborated set of rules defining administrative autonomy allowing
for discretion to legislate, decide and act on locally-produced policies. Local governments also
have power over human resource management—including recruitment, hiring, and promotion,
and defining the organizational structure of the local bureaucracy—although these are all subject
to Civil Service Commission regulations.
Fourth, the formation of civil society groups is encouraged by strong constitutional
provisions for the exercise of civil liberties. Freedom of association and expression, and the
right to information, are guaranteed by the 1987 Constitution. Enforcing this right to information
are rich jurisprudence, a number of executive issuances and a law that obligates public officials
to provide information.
Fifth, access to information is buttressed by four elements of the legal policy framework.
First, the Code of Conduct and Ethical Standards for Public Officials and Employees mandates
that all public officials provide information on their policies and procedures. Second, the
36
Supreme Court makes rulings on what constitutes information that are public in nature. Third,
administrative orders classify documents as public or instruct public agencies on ways to
disclose public information. Finally, the 1991 LGC contains important provisions that compel
local government to provide information to the public.
Finally, the exercise of voice, negotiation and oversight by civil society is encouraged at the
local level by provisions in the LGC for participation in consultative bodies involved in
development and investment planning and the formulation of sectoral policies. The Government
Procurement Reform Act not only provides a unified legal framework for procurement but also
space for the exercise of oversight through CSO representation in the Pre-Qualification Bids and
Awards Committee (PBAC).
5.1.2 Challenges to Social Accountability
While there is a well-elaborated framework for local governance and social accountability, a
number of challenges in the macro-environment constrain its implementation.
First, fiscal decentralization notwithstanding, local governments face tight fiscal conditions.
They are characterized by limited own resource generation, limited capacity for capital spending,
dependence on central transfers and budget constraints softened by the availability of significant
discretionary central transfers. All these serve to delink local spending from local revenue
generation and weaken the incentives for citizens to participate in local governance activities,
particularly holding their local government accountable.
The tight fiscal conditions are underpinned by technical problems like the structure of IRA
distribution, which tends to soften budget constraints in jurisdictions with more robust tax bases
(i.e., cities), horizontal assignment of taxes that tend to distort tax collection incentives, weak
local tax administration capacities, and the persistent lack of clarity of expenditure assignments
because of the central government’s continued involvement in financing devolved public works
and infrastructure projects.
These conditions are also a reflection of political dynamics. For example, it is not easy to address
the problems posed by discretionary central transfers, a significant portion of which come in the
form of legislator allocations including: (1) the softening of local budget constraints; and (2)
taking control over funds used to finance local capital expenditures outside the ambit of local
government. These funds are an important leveraging mechanism of the executive, which
authorizes release of the funds, and the legislative branch, which allocates use of the funds.
Political accountability is further weakened to the extent that these transfers tend to foster loyalty
of elected congressmen to the incumbent president.
Second, political dynamics also limit the effectiveness of formal democratic institutions and
decentralized administrative arrangements. The absence of platform-based political parties
and preponderance of personalistic political culture tends to systematically weaken political
accountability by narrowing the range of constituents to whom politicians are responsive. The
situation is exacerbated by strong tendencies for local state capture by historically-entrenched
local bosses, which historically form the basis for state formation.
37
Third, access to information is one of the major obstacles to enhancing the space for
exacting local government accountability. Constitutional provisions and jurisprudence are
evidently not enough to enforce this right. The existence of a non-harmonized and loosely-
worded list of government information exempt from constitutional provisions is also a problem.
At the local level, the enforcement of LGC provisions compelling local governments to post
relevant information is not closely monitored. Just as serious is the absence of a widespread
predisposition for citizens to demand information.
Fourth, the provisions for referendum, recall, the party list system, and local sectoral
representation have proven ineffective. Three attempts at implementing initiatives at the
national level have failed. There has also been no progress at the local level in terms of
referendum and recall. The implementing procedures are cumbersome and initiatives taken in the
name of people, NGOs and POs are not genuine.
Fifth, human rights violations by state agents and armed groups constrain the capacity of
citizens to hold local government accountable. These threats discourage organizing. They also
probably explain why the most advanced initiatives in social accountability are concentrated in
urban areas.
Finally, civil society difficulty in exacting accountability is as much due to the existence of
spaces provided by state institutions as to their technical capacity. CSO engagements with
local government in budget monitoring, planning and service delivery are still in their infancy.
This also partly explains why the spaces for civil society participation in local special bodies are
not fully exploited.
5.1.3 Interactions between Local Governance and CDD Operations
The case studies confirm the constraints and opportunities created by demand- and supply-side
conditions as shaped by macro-level incentives. The following three are the most notable.
Norms related to central-local fiscal transfers shape local governance conditions. Because
these transfers tend not to be based on transparent rules but on the strength of local political ties
with the central authorities that dispense them, this has fostered a governance mindset that values
the ability of local political leaders to obtain external funds for development projects. The result
is that these norms undermine citizen participation in planning and budgeting. For example, they
put PDAF allocations beyond the ambit of LDCs, the body through which the community and
CSOs can participate in budget planning and oversight.
The LGC provisions for civil society participation in local special bodies lack effectiveness
in substance and in form. In both the enabled and the constrained municipalities, the only
difference is that there is nominal representation in at least two local special bodies in the former
(i.e., in the LDC and the Local School Board). CSO representation is lacking in substance not
only because of the problem of capacity but also because the exercise of voice is limited to
consultation rather than a substantive role in prioritization and decision-making. There are no
operational institutional processes whereby citizens can exercise oversight and negotiation. Thus,
38
there is an emerging disconnect between the capacities built by CDD operations on the demand
side and governance processes in which these capacities may be used.
Despite the constraints imposed by these macro-level conditions, innovations in local
governance have been triggered by reformist leaders. As has been shown, Pio Duran and
Pilar are dependent on central transfers of roughly the same size for financing much of their
expenditures. And yet innovations in cost sharing and enhanced structures of vertical and
horizontal accountability are being tested in Pilar but not in Pio Duran. In Pilar, two context-
specific factors support this openness to innovation: first, a local bureaucracy previously exposed
to new ideas on cost-sharing and community mobilization through their experience with other
donor-assisted projects; and second, exposure to provincial government innovations in
systematically reducing poverty.
However, constrained local environments—due to conflict, elite capture and patronage—
reinforce macro-level disincentives for good local governance. In these contexts, such as in
Pio Duran, the interactions between demand- and supply-side conditions are also evident. Its
local politics undermine building incentives for social accountability as it imposes constraints on
community organizing, and makes it more difficult to build trust between communities and the
local government.
In such constrained local governance contexts, CDD operations provide a significant
channel for the poor to access goods and for communities to exercise voice. CDD operations
enable the alignment of some local development funds and transfers from central government
institutions with priorities set by communities, an improvement from previous conditions where
the use of these funds was based largely on political discretion. Moreover, the use of social
accountability tools like participatory planning, budgeting, monitoring and project
implementation are helping develop relevant skills in local governments, citizens and civil
society groups. This has built confidence among community volunteers to engage their elected
barangay leaders.
CDD projects can also be seen as a trust-building initiative that provides experience in local
state-civil society engagement for the co-production of public goods. Trust is a particularly
important theme in Pio Duran, where terrain and poverty has left many villages isolated. KCP
processes are providing opportunities for dialog between community volunteers and elected
barangay officials.
A key challenge is how to sustain and use the newfound skills and confidence of community
members once CDD projects end. For example, in the exit conference in Pio Duran, a MPDO
staff member noted the energy at the community level unleashed by the KCP and how it may be
wasted once KCP funds end. While recognition of the problem is an important first step, it is
telling that the municipality view seems to be that this puzzle is for the KCP to solve rather than
an opportunity for the municipality to further stimulate community voice and initiative.
However, in this constrained local context, it seems unlikely that these innovations and
reforms will be sustained or expand beyond the CDD project life. In Pio Duran, CDD
projects are giving the communities their first taste of engaging local government at the barangay
39
level and in exercising voice in the choice, implementation and monitoring of sub-projects. But
because of the absence of institutionalized processes for negotiation and voice in budgeting and
planning, this experience remains in a project bubble in Pio Duran. For example, it seems that
there are prior conditions that have to be met—on the supply side, reforms in central transfers so
that more of these are subjected to local control; on the demand side, capacity for voice and
association—for the development councils to institutionalize participatory planning and
budgeting introduced by CDD projects. CDD operations are seedbeds for reform that need to be
nurtured by complementary initiatives that will strengthen civil society capacities and weaken
the institutional vestiges of patronage.
In contrast, in an enabled local governance context, CDD operations have not only been
implemented more smoothly, but also have the potential to leave a mark on local conditions
beyond the project. In Pilar, CDD operations have led to innovations in bidding and
procurement, in leveraging local resources in the mobilization of central transfers, and in
energizing the local bureaucracy in regard to better ways of governing.
Thus, differences in local conditions contextualize CDD operations and their impacts in an
important way. Progress in local governance reforms in an enabled local environment may be
expected to be more fundamental given its stronger starting point. The enabling environment
thus plays a key role in determining opportunities for the ability of CDD operations to help
improve local governance conditions. In turn, an understanding of locally-specific factors like
these is important in evaluating the opportunities for local governance reforms. Fiscal conditions
alone are not sufficient predictors: opportunities may be found in the most unlikely places.
5.2 Recommendations
The main findings suggest the following operational and policy recommendations.
First, enhancing the environment for participation in planning and budget requires
reforms in central-local fiscal transfers, particularly discretionary transfers. Initial reforms
may include requiring that these transfers should fund only those projects identified in the
municipal development plan. This will give municipalities some control over the allocation of
these transfers, rather than it being based purely on the discretion of legislators. The
institutionalization of cost sharing arrangements in Pilar extended to include provincial and
congressional transfers is another potential early reform. This arrangement will at least align
central funds with community-set priorities.
Second, it is important to strengthen checks and balances for these transfers, and increase
the oversight capacity of civil society. A supply-side bottleneck may be addressed in part by
strengthening demand-side conditions. Build the capacity of national and local NGOs to
technically and politically engage in national and local budget processes.
Third, CDD operations should better incorporate local governance into its design,
particularly in activating local special bodies. It cannot be assumed that municipal and
barangay officials and community members will easily see how the skills and social technologies
embedded in CDD operations may be applied to local governance processes. This may entail
40
more than synchronizing the planning and budgeting calendars of CDD projects with municipal
and barangay planning and budgeting calendars. It involves analyzing if local government
processes and institutional arrangements can be the nodes for the institutionalization of
participatory practices. This strategy needs to be devised in conjunction with an analysis of
necessary policy support to mitigate macro-conditions affecting but not directly within the ambit
of project operations (for example, the problems posed by politicized central transfers). These
strategies should also harness the energy at the community level (i.e., CDD contributions to the
enhancement of demand-side conditions).
Finally, a local government assessment tool could help CDD operations to adopt context-
specific strategies to exploit opportunities for improving local governance. Some local
contexts are more conducive than others in mainstreaming participatory and inclusive
governance processes. Innovations at cost sharing, mainstreaming participatory procurement, and
poverty-targeted budgeting require further investigation, documentation and support. They
would make good readiness indicators for CDD institutionalization.
The ultimate success of CDD is determined when its key principles of participation, transparency
and accountability are incorporated into the planning and budget systems of local governments.
This in turn, supports the long-term agenda for reform. This report shows some factors that shape
the local governance and accountability space are within the influence of CDD operations,
including: shoring up administrative skills of the local bureaucracy for participatory governance,
animating governance arenas like the barangay assembly, building community capacity for
voice, negotiation and oversight, and providing the experience of civil society-local government
synergies that could be used to generate trust relations. However, other factors are beyond the
scope of influence of CDD operations, including: local political dynamics, the politics of central-
local transfers, and the design of institutional arrangements for vertical and horizontal
accountability. Therefore, CDD operations alone are not enough to institute the necessary
reforms for greater accountability in local governance. Rather, they are seedbeds of reform that
need to be nurtured by complementary initiatives that will address the problems of patronage,
discretion and lack of transparency.
41
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44
Annex 2: Description of the Case Study Projects
1. The Agrarian Reform Communities Development Program
Project Context and Objectives
The agriculture sector accounts for less than 20 percent of the Philippines gross domestic product
(GDP) and represents the largest employment sector. More than half of the population lives in
rural areas and are directly or indirectly dependent on agriculture for their livelihood. Only 51
percent of the total farm area is owned by farmers. With such a large number of tenant farmers,
poverty remains a major concern in rural areas. An agrarian reform program has been underway
for some 40 years, but it was only in 1988 that it received higher priority through the
Comprehensive Agrarian Reform Law (CARL).
While the Comprehensive Agrarian Reform Program (CARP) has had considerable success,
particularly in providing support service to agrarian reform communities (ARCs), its covers
about 50 percent of all ARCs (1,410). The CARP has focused on the land acquisition and
distribution priorities mandated by the government. However, agrarian reform beneficiaries
(ARBs) are receiving inadequate support services for community building, agricultural
extension, physical infrastructure, credit and marketing.
The Agrarian Reform Communities Development Program (ARCDP) was adopted as the key
implementing strategy for the CARP. The ARCDP also supports the overarching objective of the
Philippines Medium-Term Development Plan (MTDP) and the World Bank’s Country
Assistance Strategy (CAS) to restore sustainable economic growth and to accelerate
environmentally sustainable rural development with social equity. The ARCDP’s objectives are:
(i) to assist ARBs and other farm families (non-ARBs) in the selected ARCs to gain access to
productive resources and social and physical infrastructure, and (ii) to mobilize and coordinate
support to ARCs from line agencies, Local Government Units (LGUs), non-governmental
organizations (NGOs) and People’s Organizations (POs).
Project Components
Table 1. ARCDP1 (1997-2003) Project Components and Costs (millions of USD)
Component Actual/Latest Estimate Total Percent
Bank Government
Community development/technical assistance 6.10 6.10 6
Agriculture and enterprise development 37.00 37.00 35
Rural Infrastructure 45.50 11.20 56.70 54
Project Management 4.20 1.30 5.50 5
Total 49.70 55.60 105.30 100 Source: The World Bank, ARCDP 1 Implementation Completion Report, 2004.
Community Development and Technical Assistance. This component sought to enable ARBs to
achieve community-determined objectives through detailed and realistic planning, enhanced
organizational capability and more effective resource management. It aimed to increase
45
community participation in barangay planning processes and implementation of development
activities, and to maximize the sustainability of project interventions. Based on the component’s
key sustainability indicators, this component has resulted in:
incorporation of the three-year investment plans of 232 participating barangays’ in their
respective Municipal Development Plans;
strengthened POs’ capacity which led to increased membership of non-ARBs and
women; and
continued functioning of all barangay implementation teams and infrastructure and
operations maintenance groups which are responsible for sustaining project investments.
Rural Infrastructure. This component supported infrastructure investments such as the
reconstruction or rehabilitation of roads, extension of existing irrigated areas and construction or
rehabilitation of drinking water supply scheme. A total of 447 sub-projects were completed
including 239 roads, 44 bridges, 56 irrigation systems, 75 water systems and 33 multi-purpose
centers. The LGU required counterpart (in cash or in kind) for infrastructure was generally 10-30
percent of the total subproject cost. It was 70 percent for multi-purpose centers (later lowered to
50 percent), which lessened the demand for multi-purpose centers.
Agriculture and Enterprise Development. This component aimed to promote and develop farm
production and other income-generating activities of the beneficiaries through the provision of
business consultant and technical advisory services. Agrarian reform beneficiaries are assisted in
refining ARC development plans and in beneficiaries’ undertaking of individual projects. Initial
benefits included adoption of improved and appropriate technologies by 56 percent of training
participants, increased crop yields, and engagement of 46 percent of the target 40,000 farmer-
beneficiaries in off-farm and non-farm activities.
ARCDP 2 continues the initiatives of ARCDP1 and builds on the original program components.
The new component, Support to Rural Finance, seeks to provide support and training to existing
and new cooperatives to attract the involvement of microfinance institutions in the ARCs to
increase the availability of market-driven rural financial services. Table 2. ARCDP2 (2003-2007) Project Components and Costs (millions of USD)
Component Actual/Latest Estimate Total Percent
GOP Bank
Community Development and Capacity Building 1.44 .31 1.75 3
Agriculture and Enterprise Development 5.99 2.22 8.21 13
Rural Infrastructure 36.53 11.73 48.26 75
Support to Rural Finance 2.08 0.21 2.29 3
Project Management 3.37 .81 4.18 6
Total 54.80 20.00 74.80 100
Target Areas and Groups
Geographic coverage. The selection of ARCs was based on the following criteria: (i) at least 50
percent of the total households are ARBs; (ii) the ARC Level of Development Assessment
(ALDA) rating is 3 or higher; (iii) at least 75 percent of the households have land tenure; (iv) a
46
high level of interest and commitment of the LGU to support the project; and (v) high potential
for project impact and availability of technical support. For ARCDP1, the original target of 100
agrarian reform communities was slightly exceeded with the selection of 102 ARCs. These were
spread over 8 regions, 13 provinces and 93 municipalities. The ARCDP2 decreased the number
of ARCs to 80, covering 17 provinces and 112 municipalities.
Beneficiaries. Program beneficiaries were farmers from ARCs composed of one or more
barangays. Project investment was focused on contiguous barangays within a defined area to
enhance multiplier effects. The selection of the ARCs was based on criteria consistent with
existing national programs, including the targets of Philippines 2000, the Department of
Agriculture’s Medium-Term Agriculture Development Plan (MTADP) and the Department of
agrarian Reform’s Strategic Operating Provinces (SOPs).
Table 3. Project Operations Impact on the Space for Social Accountability
ARCDP Design Elements Impacts on Local Governance Reform
Means
Fund flows
Fund flows from the central level (Department of Agricultural Reform) to the local level (provinces, municipalities) are governed by transparent, poverty-targeted rules.
Fiscal relations. Performance-based financial arrangement may serve as model for rules-based fiscal transfers from line agencies. Political relations. Because transfers
are rules-based, political discretion of central political actors lessened.
Introduction of new norms in central-local fiscal relations.
Project processes
Target agrarian reform communities take part in participatory planning assessment exercises.
Voice. Capacity for voice is built in
participating ARC barangays. Association. Emergence of barangay volunteers taking part in participatory needs assessment.
Use of social accountability tools. Emergence of barangay-based social accountability champions.
Sub-project planning and selection
Project Management Board at the national level selects sub-project proposals based on criteria agreed upon by the body. Barangay-based committees develop project and prepare project concept, proposal and implementation plan.
Voice. Capacity for exercise of voice in the choice of where public resources are to be allocated.
Use of social accountability tools. Help in the operationalization and institutionalization of LGC-defined participatory planning process at the barangay and municipal level. Trust-building through active engagement with municipal and barangay governments.
Sub-project implementation
Barangay-based committee manages implementation processes, operations and maintenance.
Oversight. Capacity for oversight and management of local public services built in participating barangays.
Use of social accountability tools. Help in the operationalization and institutionalization of LGC-defined participatory planning process at the barangay and municipal level.
47
ARCDP Design Elements Impacts on Local Governance Reform
Means
Trust-building through active engagement with municipal and barangay governments as well as through co-management and co-production of public services.
Strengthening of local government institutions
Project strengthens barangay and municipal government as barangay and municipal development councils are targeted to be activated by processes engaging parallel project implementing bodies.
Public controls. Operationalization of special barangay and municipal committees.
Use of social accountability tools. Emergence of barangay and municipal-based social accountability champions.
CSO strengthening. Association. Encourages volunteerism
at the barangay level. Voice. Creates capacities for voice at various stages of the sub-project processes. Access to information. Creates demand for access to information, especially in the prioritization process.
Use of social accountability tools. Emergence of barangay-based social accountability champions. Trust-building through active engagement with municipal and barangay governments as well as through co-management and co-production of public services.
48
2. The KALAHI-CIDDS Project
Project Context
KALAHI, which stands for Kapit-Bisig Laban sa Kahirapan or “linking arms in the struggle
against poverty,” is both a program and the primary poverty fighting framework of the President
Arroyo administration. The KALAHI-CIDSS Project contributes to this broad strategy by
enhancing the planning and implementation capabilities of communities, in particular in
procurement, financial management, and project implementation. It complements other Bank
assistance that focuses on improving investments in human resources (education and health),
ensuring the poor have access to productive resources, and supporting efficient provision of other
basic services. The project also contributes to strengthening the organizational and financial
capacity of local actors, such as barangays, and the poor in particular.
Core design features of the project reinforces the Country Assistance Strategy by promoting
good and effective governance with a focus on: (i) fighting graft and corruption in projects; (ii)
improving citizen access to information; (iii) promoting civil society participation in budget
formulation and monitoring, and institutionalizing citizen feedback on quality and access to
government services; and (iv) strengthening public sector rules and capacity.
KALAHI-CIDSS adopts a community-driven approach to development and poverty reduction
by: (a) empowering communities to manage their assets, lives and livelihoods in ways that
restore their sense of responsibility and human dignity; (b) strengthening their social networks
and linking them up with policy and administrative structures of the state; and (c) promoting
representation and accountability at different levels of the decision making pyramid. The
community nature of this investment identifies the barangay as the unit of analysis, not sub-
groups or individuals within the barangay. Given its focus on the community as a functioning
unit, the project is designed to operate within existing institutional structures but to change
processes within those structures. Given its community-centric focus, most of the investments
are public or common goods.
The project objective is to assist the government in strengthening local communities’
participation in barangay governance, and developing their capacity to design, implement and
manage development activities that reduce poverty. This objective establishes a strong link
between improved local governance and poverty reduction. This goal is pursued through three
interlinked activities:
empowerment of communities through participatory planning, implementation, and
management of local development activities. It fosters an engagement with government at
all levels to access, influence, and manage resources to meet community priorities.
improvement of local governance by strengthening formal and informal institutions to
become more inclusive, accountable, and effective.
provision of grants for community investment programs by matching needs with limited
resources in a competitive manner. Communities and LGUs engage in a demand-driven
process of problem solving. The limited project grant resources will trigger better local
resource mobilization, effective community ownership of investments, and induce the
type of behavioral change required for long-term sustainability of such investments.
49
Project Components
To respond to the stated goal of the creation of public value, investment options are based on an
open menu as constrained by a negative list. Under this open menu scheme, barangays can
request funds from the project to construct infrastructure, such as roads, bridges, water supplies
and sanitation facilities. The project consists of the following three components: (a) Community
Block Grants, (b) implementation support, and (c) monitoring and evaluation.
Community block grants. The project assists communities (barangays in the selected
municipalities) through a facilitated participatory planning process to develop sub-project
proposals that are selected at an inter-barangay competitive forum comprising all participating
barangays. This process takes four to six months. To ensure that communities and other
institutional stakeholders initiate, plan, implement and manage subproject components chosen by
them, the project provides implementation support for (a) social mobilization and community
organizing, and (b) capacity-building and technical support.
Social mobilization and community organizing involves a multi-level and multi-stakeholder
organizing, socialization, and facilitation process to ensure that consistency with project
principles is achieved. Social mobilization and community organizing are cross-cutting activities
of the project happening at all stages of the project cycle: inception and area targeting, social
marketing, information dissemination and sharing, community organizing, participatory
community planning, sub-project preparation, municipal competition, project implementation,
project monitoring and the preparation and completion of project reports.
Capacity-building and technical support is provided to create capacity through training at the
community level for project planning, contracting, construction supervision, operations and
maintenance, bookkeeping and financial management to members of the Barangay Development
Council and volunteers. The communities also receive technical assistance from the
municipalities to assess the technical feasibility of sub-projects, project design and budgeting.
Training is also provided at the municipal level to technical staff (the Local Chief Executive,
Planning and Development Officer, Social Welfare Officer, and Engineer) to strengthen their
capacity to support barangay level activities and undertake monitoring.
Monitoring and evaluation. Monitoring is designed to provide for a continuous learning and
adjustment of the project approach and involves: (i) participatory monitoring by communities
based on self-defined indicators; (ii) internal monitoring of inputs, process, and outputs by the
Project Management Office (PMO); (iii) independent external monitoring and evaluation by
consultants; and (iv) civil society monitoring by NGOs and the media. A computerized
management information system (MIS) enables internal input, process, and output monitoring, as
well as an analysis of project impacts. Baseline data for impact monitoring is established early
during project implementation when beneficiary barangays have been selected through the
process of inter-barangay forums, and mid-term and terminal surveys will be undertaken
subsequently.
50
Table 4 depicts the project costs for each of the above components. There is no minimum
counterpart for LGU and community contributions per subproject. However, in the inter-
barangay selection process, community subprojects with higher LGU and community
contributions (cash or in kind) have better chances of being selected. LGUs are required to
provide contributions at the municipal level. This is around 30 percent (cash or in kind) of the
total grant allocation.
Table 4. KALAHI-CIDDS (1997-2003) Project Components and Costs (millions of USD)
Component GOP Bank Total Percent
Community block grants 41.6 90.6 132.2 72
Implementation support 39.2 7.0 46.2 26
Monitoring and evaluation 1.2 1.4 2.6 1
Total 82.0 99.0 181.0 100 Source: Kalahi-CIDDS Project Appraisal Document, 2002.
Target Areas and Groups
Geographic coverage. The project is national in scope, with the exclusion of the areas covered
by the ARRM Peace and Development Social Fund. It aims to cover one-fourth of all
municipalities in 42 provinces, where the incidence of poverty is above the 1997 national
average of 33.7 percent. Municipalities were chosen based on a study that ranks municipalities
within the target provinces based on: (i) household expenditures; (ii) human capital; (iii) housing
and living conditions; and (iv) access to trade centers. The final list of municipalities within a
province is finalized in a provincial workshop involving the provincial governor, the mayors and
representatives from the academe, the media and non government organizations.
Beneficiaries. All barangays in target municipalities are eligible for block grants. Funds are
allocated to barangays through a process of open competition, with criteria and rules set by the
Municipal Inter-Barangay Forum (MIBF). The MIBF is convened by the municipal mayor and
constituted by Barangay Representation Teams (BRT)—one of the numerous barangay-level
organs of KALAHI-CIDDS and constituted by three representatives from each barangay in the
municipality—along with municipal government department heads and representatives of the
local media, academe and NGOs. Only BRT members have voting powers in the forum. They
decide the criteria on which basis community projects are prioritize but KALAHI-CIDDS
typically pushes set criteria in trainings that prepare BRT members for the MIBF.
The Kalahi-CIDDS planning and implementation cycle is constituted by four steps, each
occurring in the municipal project sites:
Social preparation and capacity building. Stage at which the project provides inputs
(orientation training activities, community planning workshops, barangay assemblies and
other skills enhancement activities) that will enable the respective communities to
participate effectively in different aspects of the sub-projects.
Project identification and conceptualization. At this stage, beneficiary-communities in an
identify and conceptualize the project that they perceive will solve commonly-perceived
problems of the community.
51
Project selection and prioritization. This stage is concerned with the process where the
communities, through their elected representatives, meet to rank or prioritize project
proposals endorsed for funding.
Project implementation monitoring and evaluation. Implementation of sub-projects, the
finalization of operations and maintenance plans to ensure sustainability and the conduct
of periodic monitoring and field validation activities constitute the core of this stage.
Volunteer teams organized to attend to the different concerns of project implementation.
Table 5. Project interface with Social Accountability Space
ARCDP Design Elements Impacts on Local Governance Reform
Means
Fund flows
Fund flows from the central level (DSWD) to the local level (provinces, municipalities) are governed by transparent, poverty-targeted rules.
Fiscal relations. May serve as model for rules-based fiscal transfer from line agencies. Political relations. Because transfers are rules-based, political discretion of central political actors is decreased.
Introduction of new norms in central-local fiscal relations.
Local funds flow directly to barangay account.
Fiscal relations. Misses out on the
processes of accountability ascribed in the municipal budget process.
Introduction of new norms in central-local fiscal relations.
Project processes
Target barangays take part in participatory planning assessment exercises.
Voice. Capacity for voice is built in
participating barangays. Association. Emergence of barangay volunteers taking part in participatory needs assessment.
Use of social accountability tools. Emergence of barangay-based social accountability champions.
Sub-project planning and selection
Inter-barangay municipal forum selects sub-project proposal based on criteria agreed upon by the body. Barangay-based committees develop project and prepare concept, proposal and implementation plan.
Political relations. Empowerment of village members as subproject choice not limited to choices of village leaders. Voice. Capacity for exercise of voice in the choice of where public resources are to be allocated. Negotiation. Capacity for rules-based prioritization process. Public controls. New rules for prioritization may be used for municipal planning process.
Use of social accountability tools. Help in the operationalization and institutionalization of LGC-defined participatory planning process at the barangay and municipal level. Trust-building through live engagement with municipal and barangay governments.
Sub-project implementation
Barangay-based committee manages implementation procurement processes. Barangay-based committee manages operations and
Oversight. Capacity for oversight and management of local public services built in participating barangays. Public controls. Operationalization of special barangay committee for
Use of social accountability tools. Help in the operationalization and institutionalization of LGC-defined participatory planning process at the barangay and municipal level.
52
ARCDP Design Elements Impacts on Local Governance Reform
Means
maintenance. procurement Trust-building through active engagement with municipal and barangay governments as well as through co-management and co-production of public services.
Strengthening of local government institutions
Project mainly strengthens barangay government as barangay assemblies and barangay development councils are targeted to be activated by related sub-project processes.
Public controls. Operationalization of special barangay committees.
Use of social accountability tools. Emergence of barangay-based social accountability champions.
Municipal government participation is through the Mayor, MIAC and MIBF. The project has only recently articulated the need for devising a strategy for integrating KC processes with municipal government processes.
CSO strengthening. Association. Encourages volunteerism at the barangay level. Voice. Creates capacities for voice at various stages of the sub-project processes. Access to information. Creates demand for access to information, especially in the prioritization process.
Use of social accountability tools. Emergence of barangay-based social accountability champions. Trust-building through active engagement with municipal and barangay governments as well as through co-management and co-production of public services.
53
Annex 3: Maps and Key Features of the Case Study Municipalities
Map and Key Demographic and Geographic Features of Pio Duran and Albay
Source: http://www.globalpinoy.com/travel/province/albay_map.htm
Albay Region: Bicol Region (Region V) Boundaries: Pacific Ocean on the east, Lagonoy Gulf on the northeast, Burias Pass on the west and southwest Land Area: 255,260 hectares Capital: Legazpi City Number of Municipalities: 15 Number of Cities: 3 Number of Barangays: 720 Number of Households: 208,640 Population: 1,090,907 (2000) Income Class: 1
st
Poverty Incidence: 47% (2005) Employment Rate: 83% (2003) Main industry: agriculture Main crops: coconut, rice, sugar, abaca
Pio Duran Income Class: 4
th
Population: 44,423 No. of Households: 7,966 No. of Barangays: 33 Land Area: 13,370 hectares
Source: http://www.nscb.gov.ph/ru5/
54
Map and Key Demographic and Geographic Features of Pilar and Bohol
Source: http://www.globalpinoy.com/travel/province/albay_map.htm Bohol Region: Region VII Boundaries: Cebu on the West, Leyte on the Northeast, Mindanao on the South Land Area: 411,726 hectares Capital: Tagbilaran City Number of Municipalities: 47 Number of Cities: 1 Number of Barangays: 1,109 Number of Households: 209,588 Population: 1,139,130 (2000) Income Class: 1st Poverty Incidence: 70% Employment Rate: 87% (2003) Main industry: agriculture Main products: rice, corn, coconut, banana, fish, copra, mango, prawns, seaweed Pilar, Bohol Land Area: 6,248 hectares Number of Barangays: 21 Population: 25,095 (2000) Number of Households: 4,489 Income Class: 4
tth
Source: http://www.bohol.gov.ph/pilar.html
55
Annex 4: Local Governance Conditions: Comparing Enabled and Constrained Environments
Supply- and Demand-Side Categories
Conditions Common to the Two Case Study Municipalities
Conditions Specific to Pilar (an enabled environment)
Conditions Specific to Pio Duran (a constrained environment)
A. Supply-side conditions
1. Fiscal dependence on IRA
personnel costs dominate expenditures
weak own resource revenue generation
lack of local control over discretionary central transfers
Practice of some innovations including:
cost sharing to leverage local resources
greater efforts to increase own resource generation
business tax is decreasing
municipal enterprises are receiving subsidies four times their income
forgoing CDD funds due to lack of municipal counterpart funds
2. Administrative mayor-dominated planning, budgeting and procurement processes
weak systems of horizontal oversight
weak public information system
substantial number of temporary employees
Practice of some innovations including:
Monday morning public meetings of municipal heads to report on activities
regular barangay assemblies attended by municipal officials
SB meeting held at the barangay
participatory strategic planning using surveys and focus group discussions
no legislation or practices to strengthen accountability
Local Special Bodies are inactive
3. Political presence of insurgency problem caused by poverty
local political strongmen
personality-driven electoral politics
violence free elections and tolerance of political opposition
political leadership is fair and just
emerging community leaders
local political violence and conflict with insurgents
weak trust relations between citizens and local government
B. Demand-side conditions
1. Voice weak civil society capacity for the exercise of voice
weak civil society voice in Local Special Bodies (LSB)
presence of civil society organizations beyond sectoral groups
instituted NGO accreditation process
nominal participation of civil society organizations in the LDC and LSBs
civil society organizations limited to neighborhood and sector organizations
no NGO accreditation process
no civil society participation in the LDC and LSBs
2. Information weak demand for local government information (budgets, plans, policies)
reliance on informal links with the municipal government for information
recognized the important role of the barangay assembly in accessing local government information
some limited attempts to convey information (Barangay Assemblies)
public information not used for decision making
3. Negotiation and oversight weak civil society capacity for oversight and negotiation
weak vertical institutions of accountability for negotiation and oversight
CSOs prefer to lobby for funding support rather than exercise negotiation or oversight
lack of barangay experience in negotiation
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Annex 5: Key Financial Data of the Case Study Municipalities
Table 1. Pio Duran Income Sources: 2004-2006
Income source 2004 2005 2006
Total Income (M PhP) 37.4 44.2 55.7
IRA (M PhP) 34.9 37.7 45.6
Non-IRA (M PhP) 2.5 6.5 10.2
Income from grants and donations (M PhP) .3 1.0 7.4
Subsidy from other funds (M PhP) .0 3.2 .0
Own resource revenues (M PhP) 2.2 2.3 2.8
own resource revenues as a percentage of total non-IRA income 88.4 35.9 27.4
own resource revenues as a percentage of total income 5.9 5.3 5.0
Business tax (M PhP) .6 .5 .7
business tax as a percentage of own resource revenues 28.6 23.2 23.6
Real property tax (M PhP) .3 .3 .2
real property tax as a percentage of own resource revenues 13.4 11.6 8.7
Income from enterprises (M PhP) .3 .6 .5
income from enterprises as a percentage of own resource revenues (percent)
14.3 27.6 16.2 IRA: Internal Revenue Allotment M PhP: millions of Philippine pesos Source: Pio Duran Statement of Income and Expenses, 2004-2006.
Table 2. Pilar Income Sources: 2004-2006
Income source 2004 2005 2006
Total Income (M PhP) 28.6 30.4 35.7
IRA (M PhP) 24.9 25.9 31.5
Non-IRA (M PhP) 3.7 4.5 4.2
Income from grants and donations (M PhP) .0 1.5 3.0
Subsidy from other funds (M PhP) .0 .6 3.4
Own resource revenues (M PhP) 2.7 3.8 3.4
own resource revenues as a percentage of total non-IRA income 74.5 85.4 74.8
own resource revenues as a percentage of total income 9.6 12.5 8.8
Business tax (M PhP) .2 .3 .9
business tax as a percentage of own resource revenues 6.7 8.0 8.8
Real property tax (M PhP) .7 .6 .8
real property tax as a percentage of own resource revenues 25.5 15.2 26.4
Income from enterprises (waterworks, public markets, etc.) (M PhP) 1.4 1.5 1.4
income from enterprises as a percentage of own resource revenues (percent)
49.3 40.2 44.9 IRA: Internal Revenue Allotment M PhP: millions of Philippine pesos Source: Pilar Statement of Income and Expenses, 2004-2006.
57
Table 3. Pio Duran Budget Appropriations: 2007
Budget Item Amount
(millions of pesos)
Share of total
(percent)
Personal services 25.44 55.4
Capital outlays .65 1.4
Maintenance and operating expenses 4.63 10.1
Non-office costs 15.22 33.1
Calamity Fund (5 percent) 2.14
Gender Fund (5 percent) 2.14
EDF (20 percent) 8.27
Subsidy to barangays .03
Consultant and auditing services .20
Travel expenses (PNP and BMJP) .02
Representation allowance (DILG and Judge)
.08
Subsidy to municipal enterprises 2.34
Total Budget 45.94 100.0 PNP: Philippine National Police BJMP: Bureau of Jail Management and Penology EDF: Economic Development Fund DILG: Department of Interior and Local Government Source: Pio Duran Municipal Budget, 2007.
Table 4. Pilar Budget Appropriations: 2007
Budget Item Amount
(millions of pesos)
Share of total
(percent)
Personal services 16.42 44.2
Capital outlays .56 1.5
Maintenance and other operating expenses 2.80 7.5
Non-office costs 17.38 46.8
Calamity Fund (5 percent) 1.78
EDF (20 percent) 5.90
Subsidy to barangays .03
Subsidy to municipal enterprises 2.21
Total Budget 38.10 100 EDF: Economic Development Fund Source: Appropriation Ordinance No.02, Office of the Sangguniang Bayan, Pilar, Bohol.
58
Annex 6: Local Governance Conditions and Their Interactions with CDD Operations
Supply- and Demand -side Categories
Conditions Common to the Two Case Study Municipalities
Effect of Local Governance Conditions on CDD Operations
Effect of CDD Operations on Local Governance Conditions
A. Supply-side Conditions
1. Fiscal dependence on IRA
personnel costs dominate expenditures
weak own resource revenue generation
absence of local control over discretionary central transfers
constrains LGU ability to raise counterpart funds
weakens local government capacity to be more responsive to the needs of the poor
weakens incentives for institutionalizing core participatory governance principles introduced by CDD operations
constrains LGU ability to maintain, operate and expand services CDD helped deliver
intermediate expansion of fiscal space enables cash-strapped governments to fund infrastructure projects they could not afford on their own
municipal and barangay cost sharing causes the alignment of a portion of the municipal budgets with community-identified priorities
2. Administrative mayor-dominated planning, budgeting and procurement processes
weak systems for local horizontal oversight (e.g., SB-executive branch)
weak public information system
substantial number of temporary and casual employees
looming presence of local executive poses the following challenges - perceptions of politicized CDD processes - hindrance to institutionalizing core
participatory governance principles introduced by CDD operations
diminishes the quality of CDD engagements with the LGU
increase in administrative skills of municipal and barangay officials for inclusive and transparent modes of local governance
animation of barangay assembly and thereby opening up contact between municipal government and barangays
3. Political insurgency problem caused by poverty
local political strongmen
personality-driven electoral politics
where trust relations between local government and citizens are problematic, trust in CDD processes are depreciated
makes successful implementation of CDD projects politically important for incumbent politicians
introduction of performance and public service delivery into the election season discourse
59
Supply- and Demand -side Categories
Conditions Common to Two Case Studies
Effect of Local Governance Conditions on CDD Operations
Effect of CDD Operations on Local Governance Conditions
B. Demand-side conditions
1. Voice weak civil society capacity for the exercise of voice
weak civil society voice in Local Special Bodies
operational problems in mobilizing community members for CDD processes like barangay assemblies at the onset of CDD project implementation
increases difficulty for institutionalizing core participatory governance principles introduced by CDD operations
creation and strengthening of community capacity for voice in preference articulation
promotes the formulation of project-based CBOs
2. Information weak demand for local government information (budgets, plans, policies)
reliance on informal links with the municipal government for information
recognized the important role of barangay assembly in accessing local government information
CDD projects need to educate community members on the relationship between CDD processes and local government processes
enhanced demand for information on barangay priorities
3. Negotiation and oversight weak civil society capacity for oversight and negotiation
where oversight and negotiation are exercised, they are mainly through lobbying activities and the use of personal connections
weak vertical institutions of accountability for negotiation and oversight
CDD decision-making processes requiring the investment of time for meetings and the commitment of counterpart to be eligible for project funds perceived as cumbersome and costly by community members
absence of prior experience in negotiation by barangays fosters sense of competition among barangays and difficulty in having a broader municipality-wide view of development
creation and strengthening of community capacity for negotiation and oversight
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Annex 7: Local Governance Conditions and the Space for Social Accountability
Conditions Affecting Social Accountability Space in Local
Government
Enabling Conditions Disabling Conditions
1. SUPPLY SIDE CONDITIONS
1.1 Fiscal Dimension
1.1.1 Transfer system Majority of the transfers are formula-based unconditional transfers in the form of Internal Revenue Allotments (IRA)
IRA formula weakens budget constraints in localities with relatively more robust tax bases (i.e., cities)
unpredictability of timing and amount of IRA transfers
Deep vertical imbalance, with majority of local expenditures funded by central transfers, including discretionary congressional funds (“pork barrel”)
1.1.2 Revenues Revenue collection responsibilities consistent with economic efficiency, equity and administrative feasibility
Limits on the autonomy of local governments to set tax rates
Horizontal assignment of taxes across local governments distort collection incentives
Weak local tax administration capacity
Tendency of local officials not to fully exercise tax powers assigned to them for fear of electoral reprisal
1.1.3 Expenditures Expenditure assignments generally consistent with principle of providing control over the minimum geographic area that internalizes benefits and costs of provision
Persistent lack of clarity of expenditure assignments because central government is not barred from financing devolved public works and infrastructure projects
Limited fiscal space, with the wage bill taking up a major portion of local budgets
1.1.4 Local public financial management systems
Participation of civil society in local planning and oversight bodies
Existence of harmonized and clear legal framework for procurement
Weak administrative capacity for internal and external controls
1.2 Political dimension
1.2.1 Electoral system for local officials
Direct elections of executive and legislative braches of government in all barangays, municipalities and provinces
Clear term limits for all elective officials
Absence of platform-based political parties and preponderance of personalistic political culture
Strong tendencies for local state capture by historically-entrenched elite and local bosses
1.2.3 Separation of powers Clear definition of roles for local chief executive in the LGC
Clear definition of roles for legislation and oversight by local Sanggunian in the LGC
Historically strong powers exercised by the executive at the national level (especially power to release pork barrel funds) tends to foster loyalty to the incumbent president
Strong powers by the executive tend to weaken de facto oversight functioning of the Sanggunian
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Conditions Affecting Social Accountability Space in Local
Government
Enabling Conditions Disabling Conditions
1.3 Administrative dimension
1.3.1 Discretion to make and change laws and regulations pertaining to local affairs
Existence of clear sets of rules defining administrative autonomy of local governments in the Constitution and in the LGC
1.3.2 Discretion over civil service/employment policies
Local governments have power over human resource management, including recruitment, hiring, promotion and organizational structure of administrative branch subject to Civil Service Commission regulations
Limits on powers to set pay policy
Tendency for local chief executive to exercise discretion in hiring of temporary and contractual employees and in the appointment of teachers rather than institution of merit-based system
2. DEMAND-SIDE CONDITIONS
2.1 Associational autonomy
2.1.1 Freedom of association Strong constitutional provisions for the right to association Localized threats to associational autonomy due to cases of human rights violations by state agents and armed groups
2.1.2 Legal requirements for recognition of CSOs
Absence of onerous requirements for registration Absence of harmonized framework for registration acts as disincentive for organizations to apply for legal recognition and makes difficult tracking number of CSOs
2.2 Access to information
2.2.1 Right to information Constitutional provision for the right to information, with rich jurisprudence and some executive issuances enforcing said provision
Absence of Right to Information Act
Existence of poorly harmonized and loosely-worded list of government information exempt from constitutional provision for the right to information
Absence of widespread predisposition for citizens to demand information
2.2.2 Government reporting of information
Code of Ethics for Public Officials (RA 6713) include responsibility to furnish information
Web presence of most national executive agencies and many local government units
Weak remedial measures for violation of RA 6713
Low compliance on requirements to publish local government policy decisions, budgets
Absence of widespread predisposition for government agents to supply information
2.3 Voice
2.3.1 Freedom of expression Constitutional provisions for freedom of expression, including right not to be persecuted based on political beliefs
2.3.2 Unfettered media Unregulated national media Existence of threats to local media freedom, including rising case of killings of local journalists
62
Conditions Affecting Social Accountability Space in Local
Government
Enabling Conditions Disabling Conditions
2.3.3 Direct democracy institutions for the exercise of voice
Constitutional provisions and legislation for the exercise of initiative and referendum
De facto, spaces have been utilized by entrenched interest groups rather than citizens as implementing procedures are cumbersome
2.3.4 Enhancements to representative institutions
Legislation for party list candidates
Legislation for local sectoral representation (LSR)
Operational problems lessen the impact of party list system on expanding the representation of marginalized groups
Absence of enforceable law and implementing guidelines for the operationalization of LSR
2.3.5 Citizen's consultation in local government decision-making processes
LGC provisions for CSO representation in LDC
LGC provisions for CSO representation in other local special bodies, mostly sectoral councils, including but not limited to Local Health Board, Local Peace and Order Council
De facto, only LDCs tend to be functional—for compliance to approve of AIP
Local capture of CSO representation as registration process is administered by local government and not independent
Weak capacity for meaningful participation by CSOs in LDCs
Low compliance in the establishment of other local special bodies
2.4 Oversight
2.4.1 Direct democracy institutions Legislation for the exercise of recall De facto, still largely not operationalized and danger of being manipulated by particularistic interests because of provisions for role of elective officials (i.e., provision for Preparatory Recall Assembly) in what should be a purely citizen process
2.4.2 CSO participation in government oversight bodies
Legislation for CSO representation in oversight bodies like the Pre-Qualification Bids and Awards Committee (PBAC) and Local School Board
Weak CSO capacity for meaningful participation in PBAC
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Annex 8: Examples of CSO Engagement in Social Accountability
To play a more effective role in holding national government to account for their performance,
NGOs and CSOs will need to match their skills in advocacy with technical skills in areas where
they have had more limited experience to date. Two examples of this emerging role for NGOs
include the following:
Procurement Watch, Inc., an NGO based in Manila and established in 2001, seeks to
combat graft and corruption in government procurement through its advocacy, research,
and training activities. In 2003, it piloted the use of a public bidding checklist and
monitored two procurement activities of three LGUs in Metro Manila, following the
implementing rules and regulations of the Government Procurement Reform Act. It
maintains active monitoring partnerships with the departments of Budget and
Management, Health, Labor, and Public Works and works with them on procurement
reform (Arroyo and Sirker 2005).
PDAF Watch is a project of the Caucus of Development NGO Networks (CODE-NGO)
that aims to monitor projects funded by the legislators’ Priority Development Assistance
Fund (PDAF) and congressional allocations. The project mobilized volunteers to monitor
PDAF projects in 37 congressional districts. In 2006, the group successfully lobbied for
the insertion of a provision in the 2007 General Appropriations Act requiring legislators
and government agencies to make information on the PDAF and congressional
allocations easily accessible to the public (CODE-NGO 2007).
Meanwhile, CSO engagements with local government in the technical functions of budget
monitoring, planning and service delivery are still in their infancy—although there are probably
more local NGOs than national-based NGOs involved in this work. The following examples are
from a stocktaking report on locally (sub-nationally)-based NGOs involved in social
accountability in the Philippines (Songco et al. 2007):
The Transparent and Accountable Governance-Mindanao project, an initiative of the
Mindanao NGO-PO Network (MINCODE), mobilizes CSOs in the cities of Cotabato,
Dapitan, General Santos, Iligan, Island Garden City of Samal, Marawi and Surigao to
lobby for reforms in procurement, public market services, city terminal operations and
urban housing. It has triggered reforms in several functions of the seven local government
units: procurement, public market services, city terminal operations, and urban housing.
The Naga City People’s Council, a coalition of NGOs based in Naga City, is involved in
city-sponsored processes for direction-setting and sectoral policy formulation. This
council chooses and appoints NGO representatives to the local special bodies and pushed
for the publication of a guidebook to city services including detailed procedures, response
times, fees, personnel responsible, maps and a customer feedback form.
Songco also identifies NGOs with either national scope or based in Manila involved in relevant
local initiatives, including the following:
64
The Women’s Action Network for Development’s (WAND) “Local Level Gender
Budget Initiative in the Philippines” project piloted the assessment of the impact of local
government policies on gender, the identification of strategies for strengthening gender-
responsive budgeting and the development of indicators for gender-responsiveness of
budgets in health and agriculture.
The International Center for Innovation, Transformation and Excellence in Governance’s
(InciteGov) budget tracking project documented the use of financial resources in the
Autonomous Region for Muslim Mindanao since it was created in 1989.