Mindanao CSOs recommend policies for greater transparency in LGU finance

CAGAYAN DE ORO City, Jan. 23, 2011—Representatives of various civil-society organizations all over Mindanao are pushing for the immediate amendment of the Local Government Code of 1991 to allow greater CSO participation to enhance local government budgeting.

During the Budget Tracking for Transparent Accountable Governance (BTTAG) Policy Dialogue Friday, the CSOs presented a policy paper to Senator Teofisto “TG” Guingona III and DILG Undersecretary Austere Panadero.

The policy paper contains seven recommendations the CSOs strongly believed will allow for greater transparency and accountability in local government finance.

Foremost of these recommendations was the immediate amendment of the 1991 LGC by putting provisions such as “allowing accredited civil society organizations, private organizations, and business institutions to fully participate and be part of the budget process of LGUs; and allowing CSOs be part of the Local Finance Committee which is mandated by law to recommend to the LCE the level of the annual expenditures and ceiling of spending economic, social and general services based on the comprehensive development plan.”

“The Local Government Code of 1991 recognizes the accredited CSOs as legitimate members of the local special bodies. One of this is the Local Development Council. CSO representatives can deliberate the plans, budgets, and concerns of the local government. It can participate in prioritizing programs and projects that respond to the needs of the people. However the Code is silent in terms of complete CSO participation in the local budget process,” the CSO representatives stressed in their policy paper.

The local budgeting process has three phases: First, Budget Formulation, which starts with the Budget Call of the Local Chief Executive, authorization, and ends with the Budget Reviewed by the appropriate higher office; Second, Budget Execution, which starts with the Budget Request from the requesting office and ends in the Liquidation of the expense; and Third, Budget Accounting, which covers the regular financial accounting and analysis of all the disbursement and expenditures of the LGU in one fiscal year.

But in actual practice, many LGUs shortcut the process, thus the need for regular local assessment, which some LGUs are incapable of doing due to political patronage, political accommodation and other corrupt practices that have become so ingrained that it developed into the norm rather than the exception.

Municipality of Damulog Mayor Romeo Tiongco, who comes from the ranks of civil society organizations, said he is very frustrated that there is very little CSO participation in his town.

“I am very frustrated for lack of CSO participation in my municipality. Where are the engaged, involved citizenry?” he asked.

Tiongco said that since his assumption as local chief executive of Damulog 4 years ago, he has been looking for CSOs in the local government special bodies but until now, no CSOs have come forward to claim their seat in these special bodies. Tiongco is now on his second term as mayor of Damulog, Bukidnon.

He said the lack of strong CSO participation in LGUs opens the door wide for vested interests to prosper.

Rep. Rufus Rodriguez (2nd District) agreed with Tiongco, saying that CSOs participation in local governance will open wide the door to transparency and good governance.

“Transparency means the protection of the people’s money in LGUs,” he said.

Rodriguez, who is partnering with CSOs and the Archdiocese of Cagayan de Oro (ACDO) in his many pet projects, not only for the benefit of his district but for all Kagay-anons, praised the active participation of CSOs in the city.

He cited as example the planned multi-billion bioethanol plant that was successfully defeated because of strong and active participation of the CSOs and ACDO, which rose to the challenge and rallied the Kagay-anons against its establishment because of its wrong location—the bank of the Class-A Cagayan de Oro River.

“This (BTTAG) project should be expanded to other cities and provinces, including the barangays because it is the barangay where the power of government emanates from because every Filipino lives in a barangay,” he stressed.

He said that while there are many LGUs that lack the active participation of CSOs, he hoped that the BTTAG Project will change this.

The Asia Foundation (TAF), United States Assistance for International Development (USAID) and Balay Mindanaw Foundation, Inc. (BMFI) are positive that this will really change and revolutionize the local budget process.

BMFI Executive Director Paul Richard Paraguya said it is now high time for more people’s participation in local governance, most especially in the very engine of every LGU—the local budgeting process.

“Citizens have to be part of government because if not the life of government or governance will eventually die,” he said.

Paraguya, who is also BTTAG Project officer, said that CSO participation in the local budgeting process is very much worthwhile.

“This is very worthwhile because this will increase the people’s participation as well as increase the star of the local chief executives because the resources of the people are being used for their benefits,” he said.

“This can only be done if a third party will join the budget process,” he added.

Dr. Steven Rood, country director of TAF, said that this project has put budgeting in the Philippines on the right track.

“There are different levels of partnership of CSOs with LGUs; different levels of openness of LGUs to partnering with CSOs. But TAF is and always will be with you in this endeavor. Let’s all work together in pursuit of a transparent government,” he urged the CSOs.

Sen. Guingona, on the other hand, encouraged CSOs to continue the project.

“Continue this transparency in the budget process project. This is very important. It is very important that people understand and know where their money are going,” he said.

Guingona, who started the ball rolling for a transparent budget process in the national government said: “If there are people who misuse the people’s money, there should be people who should answer to the [public].”

The other policy recommendation presented were: (2) DBM, NEDA, and COA to issue memorandum circular or directives to all their respective field offices to assist private and civil society partners in their task of journeying with the LGUs to enhance transparency and accountability; Include in the seminars the topics Peace and Development to ensure capacity of local officials and CSOs in conflict management; (3) Amend the LGC and change the formula of the Internal Revenue Allocation from 45 percent for LGUs to 60
percent to LGUs. Consequently change the process of remittance. Retain 60 percent of funds by LGUs and only the 40 percent be remitted to the National Treasury; (4) Inclusion of the accountability of the CSO/PS to the community. They be made to regularly report to the community their assessment of the LGU financial system and status; (5) DBM, COA, NEDA, DSWD, and other NGAs together with CSOs/PS to establish an effective monitoring and accountability mechanism in the firm implementation of the Joint Memo Circular No. 1 Series of 2007: Harmonization Local Planning, Investment Programming, Revenue Administration, Budgeting and Expenditure Management. Include awards and sanctions; (6) NEDA to enhance the capacity of Local Planning and Development Officers in handling local peace and development planning and budgeting to ensure participation and quality of output; and (7) Change Election Schedules to time the Oath Taking of newly elected officials at the start of the government fiscal year. This will shield voters from unnecessary demand of money during election. This will also give ample time for newly elected officials to assess the situation and effectively work right at the start of his/her term. (Bong D. Fabe)