Philippine Development Forum Working Group on Decentralization and Local Government PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Philippine Development Forum primary mechanism of the Government for facilitating substantive policy dialogue among stakeholders on the country’s development agenda serves as a process for developing consensus and generating commitments among different stakeholders toward critical actionable items of the Government’s reform agenda

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Working Group on MDGs and Social Progress Working Group on Mindanao Working Group on Growth & InvestmentClimate Working Group on Governance & Anti-Corruption Working Group on Infrastructure Working Group on Sustainable Rural Development Working Group on Decentralization & Local Government Working Group on Decentralization & Local Government Working Group on Economic & Fiscal Reforms Each WG facilitates wide consultations across a broad range of stakeholders on these specific themes; each is led by a Government agency as lead convener with a development partner as co-lead convener.

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT PDF Working Group on Decentralization and Local Government (WG- DLG) serves as a venue for discussing substantive policy issues related to governance at the local government unit (LGU) level an important forum for achieving consensus on a policy agenda and set of priorities actions identified by it’s members DILG acts as the Lead Convener World Bank acts as a Co-Convener

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT DILG - Convener WB- Co-convener National Oversight Agencies (DILG, NEDA, DOF, DBM) LGU leagues (ULAP, LPP, LCP, LMP, Lnb) Development partners (WB, ADB, GTZ, CIDA, EU, AusAID, USAid, Spanish Embassy, JICA) TechnicalSecretariat (DILG, GTZ, WB) PDF WG Composition and Structure

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Development Agenda per Thematic Areas 6 PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT LOCAL GOVERNMENT FINANCE LOCAL GOVERNMENT FINANCE CAPACITY BUILDING CAPACITY BUILDING PERFORMANCE BENCHMARKING PERFORMANCE BENCHMARKING POLICY REFORMS ON DEVOLUTION POLICY REFORMS ON DEVOLUTION Accelerate revenue mobilization, improve expenditure management and increase access to financing by LGUs for better service delivery and growth promotion Harmonize capacity building programs for LGUs and other key institutions to improve capacity of LGUs in core governance functions Increase use of local government performance measurement systems to benchmark performance and create incentives for better performance Improve decentralization policy framework reflected in updated legal and institutional arrangements to strengthen local governance

PDF WG-DLG Major Accomplishments

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Theme : Capacity Building Harmonized capacity building programs for LGUs and other key institutions to strengthen capacity in core governance functions. Outputs: Harmonized and integrated capacity building initiatives of the national agencies, the leagues of LGUs, and the private sector through the Newly Elected Officials (NEO) Orientation Program  2 rounds of NEO (2007 & 2010) Integrated multi-agency initiative to harmonize core LGU operations on planning, investment programming, revenue administration, and budgeting through t Joint Memorandum Circular No. 1 of 2007 and its roll-out at the local level  improved coordination among oversight agencies (NEDA, DOF, DBM) with development partners, and LGU Leagues

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Theme: Local Government Finance Accelerated revenue mobilization, improved expenditure management, and increased access to finance for better service delivery and growth promotion. Outputs: Policy on automatic appropriation of the IRA and NG-LGU Cost Sharing policy Simplification of procedures for the release of LGU shares in national wealth Mining (DBM-DILG-DENR JMC ) Mineral reservations (DBM-DILG-DENR JMC ) Tobacco excise tax (DBM-DILG-DENR JMC A) Franchise tax (DOF-DBM JMC ) Enabling information sharing between BIR and LGUs (Executive Order 646) Issuance of Philippine Valuation Standards on RPT in conformity with the international standards (DOF DO 37-09) Allowing 1st tier LGUs to secure loan from International Financing Institutions (ADB, IFC, WB) without sub-sovereign guarantee (EO 809) Clarification on SITUS of tax on banks and other financial institutions(DOF FC No. 2-07) Harmonization/integration of reporting system for financial, fiscal and budgetary requirements from LGUs by NG Oversight Agencies (DOF-DBM JC No. 2, s. 2008)

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Theme: Performance Benchmarking Increased utilization of local government performance measurement systems to benchmark performance and create incentives for better service delivery. Outputs: Refinement and restructuring system software of DILG’s Local Government Performance Management System (LGPMS) Integration of DOF’s Local Government Fiscal Monitoring System (LGFPMS) with LGPMS Development of Performance Based Incentive Policy which was adopted by DBCC in February 2009

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Theme: Policy Reforms on Devolution Improved decentralization policy framework through updated legal and institutional arrangements to strengthen local governance Outputs: Proposed amendments to the Local Government Code with respect to IRA, taxation, and fiscal matters for consideration of Congress Draft administrative issuances towards improving local government financial management (under consultation with concerned agencies):  Utilization of the Special Education Fund  Dealing with surpluses and deficits in LGUs  LGU personal services expenditure policy  Improving financial management of local economic enterprises  Maximizing the exercise of corporate powers of LGUs  Streamlining procedures on the release of shares of national wealth  Improving LGU access to and monitoring of ODA

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Cross-Cutting Theme: Strengthened alignment, coordination, and harmonization of development partner and national government support for decentralization. Outputs/Outcomes: Sub-Working Group on Inter-Local Cooperation provides a forum for knowledge sharing, coordination of actions, identification and discussion of policy issues specifically relating to inter-local cooperation mechanisms among LGUs Organization of the Coordinating Committee on Decentralization (CCD) led to common positions and recommendations of NGAs and LGU Leagues Establishment of Decentralization and Local Government (DIALOG) Trust Fund synchronizes delivery of PDF WG-DLG priority agenda Proposed Sub-Working Group on Local Investment Reform (LIR) with WG on Growth and Investment to promote local growth and investment (subject to approval of WG-DLG)

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT Strengthened coordination among development partners Promoted common positions and recommendations among NGAs and LGU Leagues Complementation of efforts among donors and government Greater alignment of ODA to the government’s reform agenda Benefits and other Outcomes

PDF WG-DLG WorkPlan for

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT WG-DLG Work Plan for 2010 Thematic AreaProject/Activity Cross-cutting efforts Pilot-testing of performance based incentive policy (on-going – Performance Challenge Fund) National streamlining of BLPS (on-going) Develop a program for enhancing LGU competitiveness (on-going) Local Government Finance Develop of an e-system for LGU fiscal and financial management (done – e-SRE) Develop mechanism for more strategic for use of ODA (study completed) Streamlining procedures in the release of LGU shares in forest charges, energy resources and mining royalties (on-going) Development of an improved Personnel Expenditure Policy (study completed) Improvement on the policy on the utilization of Special Education Fund (policy drafted) Address problems of LGU in Updating Schedule of Market Values (SMVs) Develop recommendations to refine parameters for IRA computation (Study completed)

PDF-WORKING GROUP ON DECENTRALIZATION AND LOCAL GOVERNMENT WG-DLG Work Plan for 2010 Capacity-Building Develop capacity-building programs on special topics (e.g. financing options available for LGUs, management and coordination of ODA, DRRM and climate change adaption, Amended Fire Code) Continue implementation of JMC 1, 2007 (on-going) Performance Benchmarking Capacity-building for the utilization of LGPMS by LGUs (done) Advocacy on the utilization of LGPMS by NGAs, and Donors (on- going) Improving integrity and quality of local statistical data Policy Reforms on Decentralization Definition of policy and legal framework on the extent of LGUs corporate powers (study completed) Review of decentralization-laws and policies specially those affecting fiscal operations of LGUs (draft Amendments to LGC submitted) Action Plan for further devolution Review of the policies for the creation, abolition and merging of LGUs Promote inter-local governance reforms (on-going)