PA 299: Seminar in Governmental Management

The Local Government Units

Local government units (LGUs), being at the core of the government structure, are considered
as the frontline units in terms of governance. They serve as the direct link or conduit of the
national government to the people, and with distinct mandate and authority granted by the
Constitution and existing laws. LGUs play essential roles in operationalizing the visions and
policies of government administrations on the ground and making sure that they are delivered
and felt by the majority, if not all citizens.
The 1987 Constitution recognizes the key role of local governments in overall governance and
ensures their autonomy. It sets a decentralized system, with specific functions to “provide for a
more responsive and accountable” local governance. Republic Act (RA) 7160 or the Local
Government Code of 1991 assures “genuine and meaningful local autonomy” to enable LGUs
“attain their fullest development as self-reliant communities and make them more effective
partners in the attainment of national goals.”
In attaining national development, for instance, the central government sets the main policies,
goals and directions, and operates them through the specific departments in collaboration with
the local governments -- the provinces, cities, municipalities and barangays. LGUs, supported by
government resources and augmented local assets and reserves, localize the implementation of
national programs through their devolved functions.
As provided for in the Constitution, the President as head of state and the executive branch,
has general supervision over local governments through the Department of the Interior and
Local Government. It is the agency tasked to manage affairs concerning the LGUs, and ensure
that they are capable and empowered enough to perform their mandates functions.
All four territorial and political subdivisions are given freedom to exercise local autonomy, with
specific scope, power and authority but follow a system of hierarchy. Provincial governments
have jurisdiction over component cities, municipalities and barangays. As such, cities and
municipalities exercise supervision over the barangays. Provinces don’t have supervisory
functions over chartered cities, which are also independent in terms of territorial and political
matters.
Provincial, city and municipal officials such as the governor, vice governor, board members,
mayors, vice mayors, city or municipal council members are elected to a fixed term of three
years and eligible for re-election to at least three consecutive terms. The same follows for the
punong barangay and the sanggunian members but their terms are often extended these past
years due to the perennial postponement of the elections.
As in the national government setup, LGUs have legislative bodies that function and operate
independently to create and review local ordinances, scrutinize and allocate budgets as well as
approve or authorize agreements that will be entered into by the executive department,
especially the provincial, city and municipal government. This also follows the principle of check
and balance between the local executive and legislative branches. However, the setup is
different for the barangays wherein the chairperson or the punong barangay uniquely functions
both as chief executive and head of the legislative body.
Provinces, Cities Municipalities, Barangays
Provinces are the largest political unit in the country and governed by provincial governments,
which assume responsibility over the entire territorial area. There are currently 81 provinces or
provincial divisions in the country.
Provinces are classified according to income class or their average income in the last five years,
with the higher classification given to those with higher income as well. The income
classification serves as basis for the granting of salaries. The provincial governor has the power
to appoint or hire officials and personnel for all plantilla positions and enlist additional
workforce if deemed necessary.
The municipalities are territorial subdivisions consisting groups of barangays and are under the
supervision of the provinces. The municipal mayor serves as the chief executive officer, with
given functions to execute all laws and municipal ordinances, supervise the administration of
the town, issue orders relative to the maintenance of peace and order and recommend
measures to the municipal council or their legislative body.
A city is composed of more urbanized and developed barangays and may either be classified as
component or highly urbanized. Component cities are under the supervision of the provinces
and voters participate in electing provincial officials.
Chartered cities are created by a special law which serves as its charter. It defines the
boundaries, provides a system of government and defines the powers and duties of its officials.
The mayor is the executive official of the city and assisted by appointed officials that lead
various departments. The city council, headed by the vice mayor, functions as the city’s
legislative body.
Barangays, the smallest unit among local governments, are headed by an elected punong
barangay or chairperson who is assisted by the sanggunian or council members. The
chairman/person enforces all applicable laws and ordinances, organize citizen volunteers to
fight criminality and maintain peace and order, as well as preside over all meetings both of the
barangay council and assembly.
Among the important powers granted to LGUs is the creation and management of its own
sources of income or revenues as well as impose and collect taxes, fees and charges in the
exercise of its devolved functions. These include levying business and real property taxes and
collecting mining and quarrying fees. The fiscal power of local governments is actually the main
component of local autonomy and actually among the mechanisms that drive them to exercise
functions exclusive of national government intervention, especially on the aspect of local
development.
To fully attain and ensure that LGUs enjoy local autonomy, the Constitution assures them of just
share from national taxes collected in localities. This is in the form of Internal Revenue
Allotment or IRA share, which is set under a 60-40 sharing scheme in favour of the national
government as set in the Local Government Code. Equal share is assured as well in the income
generated from national resources, among them power generation sources and extracted
minerals, situated within their areas.
Every LGU assumes both political and corporate nature, with the governor or mayor acting as
the chief executive officer. Their corporate powers are: to have continuous succession in its
corporate name; to sue and be sued; to have and use a corporate seal; acquire and convey real
or personal property; enter into contracts; and, assume other functions allowed by law.
Another important function of a local government, through the chief executive, is “to exercise
the power of eminent domain for public use, or purpose or welfare for the benefit of the poor
and the landless, upon payment of just compensation, pursuant to the provisions of the
Constitution.”
Issues/Challenges to RA 7160
While many local governments have thrived and vastly developed in the last three decades due
to the local autonomy granted under the Constitution and operationalized by the Local
Government Code, a significant number remained poor and mired in a myriad of problems that
affected their functions. While some of these can be traced to inefficiency, problematic political
setup and inept leadership, there are policy-related deficiencies that need to be addressed as
well to cope with the changing development landscape in the country.
Observers have cited the problematic absorptive capacities of LGUs that have not matched with
the demands of responsibilities entrusted by the Local Government Code.
Some LGUs were overwhelmed with the devolved services and functions either due to the lack
of capability and resources. These include rendering agricultural extension and on-site research,
community-based forest projects, field health and hospital services, public works and
infrastructure projects derived from local funds, school building programs, social welfare
services, tourism facilities, housing projects for provinces and cities and such other services
pertaining to industrial support.
Many local governments remain dependent on their IRA shares as collections from local taxes
remained dismal, although these can be attributed to the lack of available resources and
development opportunities as well. South Cotabato, for example, is classified as a first-class
province but is highly dependent on its IRA in terms of funding its operations and initiatives.
The landmark Mandanas doctrine or ruling, which will take effect in 2022, will greatly ease the
burden of LGUs as it will increase their IRA share by as much as 28 percent.
Acting on a petition filed by chief executives led by Gov. Hermilando Mandanas, the Supreme
Court affirmed that the just share of LGUs, the IRA, must be computed based on all national
taxes, and not just from National Internal Revenue Taxes (NIRT). This includes other taxes such
as those collected by the Bureau of Customs and agencies that are authorized by law to collect
NIRT.
This will address the problematic financial capacities of most LGUs and somehow challenge the
national government’s hold and control on the bulk of productive sources of revenue.
There have been efforts to amend the Local Government Code as well as the 1987 Constitution
over the years to help address these gaps and make local autonomy work better.
This includes shifting to the federal form of government, which was among the campaign
promises of President Rodrigo Duterte. It banks of the core principles of Federalism, a system of
government whereby power is distributed between a central government and regional or
provincial governments, to promote more effective decentralization in the country.
Proponents believed that it could help address the inequitable treatment of the countryside in
terms of resource allocation and veer away the government’s focus on the so-called Imperial
Manila. It was seen as a lasting solution to the decades-old Moro rebellion in Mindanao.
But these efforts have not moved as planned, with Congress, especially the Senate, repeatedly
declaring that it is not keen on taking up the matter. With only over a year left before the 2022
national and local elections, standoff will likely continue.
The DILG has already shifted focus on pursuing pocket Constitutional amendments and already
submitted last January to the House Committee on Constitutional Amendments some 555,610
signatures and LGU resolutions in support of lifting the restrictive economic provisions.
The proposals, with the country’s 1, 488 municipal mayors as main petitioners, include the
institutionalization of the Mandanas ruling in the Constitution and the lifting of restrictions on
foreign investment in industries currently limited to Filipinos.
It seeks to allow foreign investors to engage in industrial and commercial activities that had
been restricted to Filipinos since the 1935 Constitution took effect.

References:
https://www.officialgazette.gov.ph/constitutions/1987-constitution/
https://www.officialgazette.gov.ph/1991/10/10/republic-act-no-7160/
https://www.dilg.gov.ph/facts-and-figures/Regional-and-Provincial-Summary-Number-of-
Provinces-Cities-Municipalities-and-Barangays-as-of-30-September-2020/32
https://www.preventionweb.net/files/globalplatform/entry_bg_paper~CDPGUIDE.pdf
https://www.econstor.eu/bitstream/10419/46627/1/494483288.pdf
https://dilg.gov.ph/PDF_File/reports_resources/dilg-reports-resources-
2016120_5e0bb28e41.pdf
https://newsinfo.inquirer.net/1308480/dilg-mayors-pushing-2-charter-amendments