LGPF: Welcome Remarks

The IRA Cut: Threat to Local Governance and Democracy
Atty. Vincent Edward R. Festin and Atty. Marlon J. Manuel

Democracy Falling

In the quoted decision of the Supreme Court, it was stated that the autonomous government becomes accountable not to the central authorities but to its constituency. Cutting the local governments' dependence on the national government highlights the sovereignty of the people as the source of governmental power. Indeed, democracy is an indispensable element of local governance and local autonomy. To be more accurate, local governance and local autonomy are founded on principles of democracy.

When the Constitution mandates the setting up of a responsive and accountable local government structure instituted through a system of decentralization, the Constitution goes farther and provides that such local governance structure shall have effective mechanisms of recall, initiative, and referendum. The Constitution also provides that the legislative bodies of local governments shall have sectoral representation as may be prescribed by law. The Constitution's chapter on Social Justice and Human Rights devotes a portion on the role and rights of people's organizations and guarantees the right of the people and their organizations to effective and reasonable participation at all levels of social, political, and economic decision-making.

Consistent with the Constitutional policy of democratizing local governance, the Local Government Code provides for the mechanisms that will ensure the people's participation in local governance. Among these mechanisms of participation are the procedure for the recall of government officials, the passage of resolutions and ordinances through local initiative, and the mandatory prior consultations with the people.

These Constitutional and statutory provisions emphasize that the democratic mechanisms that will ensure the people's participation in governance shall remain inseparable from local autonomy and governance. Local autonomy, in fact, is meant to shield local governments from the influence and control of national government authorities so that these local governments can effectively discharge their powers and responsibilities with only the people's interest in mind.

The IRA cut will certainly mean a reduction in the funds that can finance the mechanisms for people's participation in local governance. It provides local government officials an excuse to "prioritize" basic services over the equally, if not more, important implementation of the democratic mechanisms and venues for people's participation in governance. The failure to convene the local special bodies, for example, can be blamed on the lack of funds. Doubtless, the IRA cut can also be expected as a ready argument against the implementation of the constitutional mandate for sectoral representation in the local legislative bodies.

More than the breakdown in the democratic structures for people's participation in local governance, however, the IRA problem poses a more dangerous, albeit not readily apparent, threat. Using the IRA as an effective carrot - a magic charm - the national government has successfully turned the local governments' loyalty and attention away from their constituents. Local governments are, once more, in danger of being mere instruments of the national government. Adding insult to injury, all these are made through the use of the people's funds that should have been automatically released to them.

Conclusion

In sum, the Constitution and the Local Government Code clearly give local governments the IRA as a right, their just share in national taxes. Contrary to the position of some national government officials, the IRA is not "assistance" from the national government. It is the rightful share of local governments in public funds, corresponding to the local governments' share of the burden of governance. To protect the local governments' right to the IRA, the law gives the national government the express mandate to automatically release the IRA to the local governments without any lien or holdback. While the law recognizes that the IRA can be reduced in the event of an unmanageable public sector deficit, the law sets certain requisites before the actual reduction can be done. The law also imposes a limit on the amount of the cut itself.

With P10B of the IRA placed under "unprogrammed funds," the IRA is effectively reduced. Since this reduction did not comply with the strict requirements of the Local Government Code, it is clearly illegal. The IRA problem, however, is not simply a question of legality. It goes into the very core of our system of local governance.

The underlying reason for the preferential treatment of the IRA is the policy of emancipating the IRA from any form of interference and/or control from the national government. This policy is rooted in the principle of local autonomy that guarantees the right of local governments to chart their own destiny and shape their own future free from undue intervention from the national government. Local autonomy, in turn, is indispensable in democratizing local governance. Local governments' freedom from the control of central government authorities is essential to the local governments' accountability to the people. More than the legal issue, this should be our concern.

With the recent conflict on the IRA, a number of dangers that threaten the Philippine system of local governance surfaced. On the part of the national government officials, the debate on the IRA highlights the mistaken belief that local governments are at the mercy of the central government, and that the IRA is a form of assistance given out of the generosity of the national government. On the part of the local government officials, the IRA debate shows their vulnerability to succumb to pressure and influence from the national leadership. Unfortunately, while the battle over the IRA is fought in the halls of power by the national and government officials, the people's interest is at risk. The IRA cut undermines the integrity of our local governance system by seeping into and destroying the foundations of autonomy and democracy in local governance. It cultivates a system where local government officials who are held hostage by the budget process will be accountable, not to the sovereign people that gave them the power of governance, but to the national leaders that control the nation's purse.