No. of :

No. of Shares:

Currently viewed by: Marcus Rosit

Budget reform bill ensures equitable funding for LGU projects

Senate of the Philippines (File photo)

CALOOCAN CITY, (PIA) -- Local government units (LGUs) will have fixed budgets yearly to ensure that their projects will be properly implemented and at the same time, end political accommodations, according to a bill filed by Senator Robinhood Padilla.

Senate Bill 447 provides that the Local Development Equalization Fund (LDEF) be used strictly by LGUs for development projects, activities, and programs (PAPs) listed in their Comprehensive Local Development Plans.

Under Padilla's bill, the national government shall fund the LDEF, including P500 million to P1 billion per province per year; P100 million to P200 million per city per year; P50 million to P100 million per municipality per year; and P3 million to P5 million per barangay (village) per year.

The amount of LDEF for each province, city, or municipality shall be based on 50 percent of the prescribed amount for each first-class LGU; 60 percent for second-class LGU; 70 percent for third-class LGU; 80 percent for fourth-class LGU; 90 percent for fifth-class LGU; and 100 percent for sixth-class LGU.

The funds cannot be used as cash gifts, bonuses, food allowance, medical assistance, uniforms, supplies, meetings, communication, water, light, and fuel; for salaries or overtime pay; traveling expenses; registration or participation fees in training and seminars; in repair and maintenance works in administrative offices; in acquiring furniture, equipment, and appliances; and in the acquisition or maintenance of vehicles.

Neither may the LDEF be used for funding PAPs that may duplicate or overlap with those being implemented by the national government.

The bill, according to a news release on Saturday, is in line with the agenda of budget reform pursued by former senator Panfilo Lacson, which promotes the principle of devolution.

"The cornerstone of this proposed measure is the creation of a Local Development Equitability Fund to support the mandated expenditure assignments imposed upon LGUs. Accordingly, this measure aims to provide an equitable distribution of wealth to LGUs to foster development with the end goal of bridging the gap between the revenue expenditure mandates of the LGC and the General Appropriations Act," according to the bill’s explanatory note.

While the government is pursuing devolution to ensure the efficient delivery of public services, it cannot do so fully because "political and economic power" remains centered in the so-called Imperial Manila, Padilla said.

As a safeguard to the bill, a performance-based evaluation of the use of the funds will be checked by an Oversight Evaluation Committee (OEC), to be headed by the Undersecretary of the Department of Interior and Local Government.

The bill also provides for a Congressional Oversight Committee to monitor the implementation of the provisions of the bill.

The committee members will include officials and at least four members of accredited civil society groups and non-governmental organizations in the areas where the projects are to be implemented.

The LDEF will be decreased for LGUs that get an "unsatisfactory" performance rating.

Two successive unsatisfactory ratings may result in the removal of the LDEF, although an LGU can reapply after one year.

The government shall provide P1 billion for the capacity building of LGUs to make sure they can properly use the LDEF and a web-based monitoring system shall be set up by the OEC, with initial funding of P100 million.

A penalty of one to six years and a fine of P500,000 await officials who will withhold the release of the LDEF to the LGUs.

Those who misuse the funds may be charged with technical malversation. (PIA-NCR)

About the Author

Susan De Leon

Assistant Regional Head


IO 3

Feedback / Comment

Get in touch