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DECENTRALIZATION AND DEMOCRATIZATION

In the later part of the 20th Century there has been a dramatic shift in the manner
governments around the world managed their states. Instead of having a centralized form
of government, most nation nation-state now somehow adopts the idea of shifting some
of the national or central powers to the local government units. This shifting of powers is
called Decentralization. Decentralization is the transfer of planning, decision making, or
administrative authority from the central government to its field organizations, local
governments, and nongovernmental organizations as defined by Rondinellei and Cheema.
According to de Guzman and Padilla, decentralization is the dispersal of authority and
responsibility and the allocation of powers and functions from the center or top level of
government to regional bodies or special purpose authorities, or from the national to the
sub national levels of government.

Decentralization is a strategy used by the government towards democratizing the political


system and accelerating the attainment of sustainable development”1 for the reason that it
will promote or allow fuller participation of the citizens in government affairs and will
give the local governments and the communities a more active role in the economic,
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social and political development . Government further assumes that through
decentralization “development would be more responsive to the needs of the people and
would create opportunities in the regions, promote employment and economic activities
and as well strengthen people’s participation in the affairs of the government”3.

Different forms of decentralization can be distinguished primarily in terms of the extent


of authority transferred and the amount of autonomy. Decentralization may take the form
of devolution and deconcentration. Deconcentration involves the “redistribution of
administrative responsibilities only within the central government”4. It is not a transfer of
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Decentralization Towards Democratization ann Development in the Asian Pacific Region: Eastern Regional
Organization for Public Organization (EROPA). edited; De Guzman, Raul. Reforma, Mila. Bookman Printing House,
Manila, 1993. p 5
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Decentralization Towards Democratization ann Development in the Asian Pacific Region: Eastern Regional
Organization for Public Organization (EROPA). edited; De Guzman, Raul. Reforma, Mila. Bookman Printing House,
Manila, 1993. p 3
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.

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power from the central government but merely to “delegate such powers and
responsibilities to the hierarchical levels, primarily to facilitate the administration of
national programs and services, and this approach is otherwise referred to as
administrative decentralization”5. Administrative decentralization can take effect without
the necessity of legislation but with the issuance of an executive or administrative order.
Although the local units now have responsibilities bestowed to them, they are still
supervised and controlled the central government; therefore all transactions cannot be
done unless approved by the central government. They are not to decide on their own.

Deconcentration is the assignment of functions to ad hoc bodies and special authorities


created in the region to render technical assistance on regional development. This could
be done in different ways: 1) the shifting of the workload from a central government
ministry or agency headquarters to its own field staff located in offices outside the
national capital. 2) The transfer of some decision-making discretion to field staffs but
with guidelines set by the central ministry. 3) Local administration, in which all
subordinate levels of government within a country are agents of central authority, usually
the executive branch6.

Another form of decentralization is delegation or the transfer of some functions to semi-


autonomous organization not directly under the control of the central government. Often
these organizations have semi-independent authority to perform their responsibilities and
may not even be located within the regular government structure7. This form is more
definitely extensive than administrative deconcentration. Examples are public
corporation, regional planning and development authorities, multi purpose and single
purpose functional authorities and special project implementation units.

Devolution, on the other hand, “seeks to create or strengthen independent levels or units
of government through giving them certain functions or create units of government that

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Decentralization Towards Democratization ann Development in the Asian Pacific Region: Eastern Regional
Organization for Public Organization (EROPA). edited; De Guzman, Raul. Reforma, Mila. Bookman Printing House,
Manila, 1993. p 4
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are outside its control8. It is also called as “political decentralization and involves the
transfer of power, responsibility and resources for the performance of certain functions
from the national to the local governments”9. Its fundamental characteristics are: a. Local
government units (LGU’s) are autonomous, independent and clearly perceived as a
separate level of government over which central authorities exercise little or no direct
control. b. LGU’s have clear and legally recognized geographical boundaries within
which they exercise authority and perform public functions. c. LGU’s have corporate
status and have the power to secure resources to perform the function. Lastly, d.
Devolution implies the needs to develop local governments as institutions. This is an
arrangement in which there is reciprocal relationship between central and local
governments. The LGU’s has the ability to interact reciprocally with other units in the
system of government of which it is part.

Lastly, Nongovernmental Organizations (NGO) and Community Organizations is used


to “decongest the government by mobilizing the NGOs and COs for planning,
implementation, monitoring and evaluation of government programs which will make
government actions more responsive to the needs and demands of those who truly
deserve government assistance and may minimize graft and corruption while injecting
cause-orientedness in the bureaucracy”10

There are mixed motives and causes of the shift to decentralization worldwide, primarily
politically driven. Some commonly sited reasons are democratization increases efficiency
and economic growth, improves supply and delivery of local services, vested interests of
national politicians, preservation of national political systems in the face of growing local
demands and general failure of centrist experiments.

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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Decentralization Towards Democratization ann Development in the Asian Pacific Region: Eastern Regional
Organization for Public Organization (EROPA). edited; De Guzman, Raul. Reforma, Mila. Bookman Printing House,
Manila, 1993. p 4
10
Decentralization Towards Democratization ann Development in the Asian Pacific Region: Eastern Regional
Organization for Public Organization (EROPA). edited; De Guzman, Raul. Reforma, Mila. Bookman Printing House,
Manila, 1993. p 4

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In the case of the Philippines, of the four given forms of decentralization, devolution is
the prevalent form of decentralization used by the government.

Decentralization and democratization tend to reinforce each other; decentralization is a


factor in increasing democratization while successful decentralization can only take place
with democratic process. To a certain extent, that is what the devolution and the local
autonomy is all about: unleashing the creative powers and resources at the local level
towards the general objective of developing of self-reliance and lessen dependence upon
the central government which after all has been one reason for the state of
underdevelopment of local government unit in the Philippines. Indeed, local governments
in the Philippines are undergoing a fundamental structural and ideological transformation
as a result of the devolution in 1991. This transformation will be better appreciated within
the context of decentralization, democratization and local empowerment.

THE EVOLUTION OF PHILIPPINE LOCAL GOVERNMENTS AND


CENTRAL- LOCAL RELATIONS: FROM PRECOLONIAL BARANGAY TO
THE 1991 LOCAL GOVERNMENT CODE

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Although it is commonly assumed that the decentralization process in the Philippines is a
complete break from the overly centralized past, evidences show that “the so-called
landmark LGC of 1991 is not an abrupt break from the past but a result of a long struggle
for decentralization and local autonomy.11” According to Hutchcroft, scholars viewed the
Philippine public administration as “over centralized because they tend to concentrate far
more attention to formal structures of authority than on informal networks of power” 12.
But looking back in time, “before the arrival of Arab traders, scholars and the Spaniards
in the sixteenth century, everything was local.”

“The ancestors of the Filipinos established an indigenous and


autonomous political institution known as the barangay, which was
composed of some thirty to one hundred households. Some of these
small-scale political units were clustered together, but most of them
‘had not attained a level of political organization above and beyond
the kinship principle.”13

When the Spanish colonizers came, they introduced “a centralized system with the
Spanish governor-general as the supreme authority in all matters”14 with the “subnational
officials acting as his agents”15. The barangay (renamed as barrio) remained as basic
administrative units but other ties of local government were added: “the pueblos
(municipalities), cabildos (cities), and provincias (provinces).”16 Local discretion in the
governance of local affairs was allowed only towards the end of the Spanish regime.
“The Maura Law of 1893 sought reforms in the local government system by granting
greater local autonomy to towns and provinces in Luzon and Visayas and by allowing
local citizens to select some of their officials.”17 But because of the Philippine

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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Revolution which shortly followed in 1898, these reforms did not make much impact at
all.

According to Tapales, the Spanish period had impacts, however, on the development of
local governments in the Philippines.

“First, indigenous activities were supplanted by putting in place an


alien system of local government. Second, a high degree of
centralization in the capital of Manila in Luzon came to characterize
national-local relations for another century after the Spanish
colonization. Third, the divide-and-rule policy of Spanish colonizers,
their concentration of all political activities in Manila and the ensuing
neglect of the other regions outside Manila, and the curtailment of
many elements of internal trade strengthened regionalism and the other
regions’ contempt for the center, which remain strong until today.
Fourth, at the end of Spanish rule, there were still areas in the
Philippines that considered themselves not part of the emerging nation
at all which was because the Spaniards were unsuccessful in
consolidating all the islands under their control. And finally, the
Spanish period left local elite that would continue to play important
roles in the decades ahead. The datu in the Philippines were
incorporated into the Spanish colonial regime. They were dependent
upon Spanish patronage and support but they also exercised
considerable powers in the local areas.”18

In 1898, against the backdrop of the Philippine Revolution against Spain, the first but
short lived Philippine Republic under the Malolos Constitution was established. Officials
were elected on a popular basis and "decentralization" and "administrative autonomy"
were among the rallying cries of the period.19 The Malolos Constitution which served as

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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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Alex B. Brillantes, Jr. , Decentralization, Devolution and Development in the Philippines, UMP-Asia
Occasional Paper No. 44, 1999

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the framework of the Philippine revolutionary government, provided for the creation of
municipal and provincial assemblies, autonomous local units, and popular and direct
elections.20

The American occupation of the Philippines (1902-1935) saw the promulgation of a


number of policies promoting local autonomy. These included the organization of
municipal and provincial councils based on general suffrage. Other pronouncements
indicative of the thrust towards local autonomy included the following: the Instructions of
President McKinley to the Taft Commission; the incorporation of the City of Manila (Act
183 of the Philippine Commission in 1902); the establishment of the Moro Province (act
787 in 1903); the organization of provincial governments (Act 1396 in 1905); and the
extension of popular control, like the elimination of appointive members from the
provincial board.21 The American colonial period began with an emphasis on local self-
government with the aim of building democracy from below. Municipal and then
provincial elections were first introduced before national elections. However, American
administrators discovered that Filipino elites who came to fill posts in municipal
governments “where regularly ‘mishandling public funds’ by voting all available revenue
to pay for their own salaries.”22 Concerned with inefficiency and corruption in local
governance, Americans tinkered with the liberal democratic system they introduced by
moving toward centralization to prevent the “evils” of unrestricted and “untutored”
Filipino rule. While the United States attempted to institute a new system, it ended up
preserving much of the informal power structure and in ruling through the ilustrado and
cacique classes. Like their Spanish predecessors and other colonial regimes in South East
Asia, American administrators allowed the cooperative elements of the Filipino elite an
increasingly larger role in government for expediency purposes. But in the process, they
turned a blind eye on the local elite who “enriched themselves at the expense of the
peasants and increased their traditional power within the local communities.23

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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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For the extensive and detailed discussion of these various initiatives, see Laurel, op cit., pp.289-293
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Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.
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In spite of the enactment of the above-mentioned policies purportedly supportive of local
autonomy, the Americans maintained a highly centralized politico-administrative
structure. Largely because of security considerations, local affairs had to be under the
control of the Americans.

The Commonwealth period (1935-1946) saw local government in the Philippines placed
under the general supervision of the President as provided for under Article VII Section II
of the 1945 Constitution. Additionally, the President, by statute, could alter the
jurisdictions of local governments and in effect, create or abolish them.24 Ocampo and
Panganiban note that the constitutional provision limiting the President's power to general
supervision was a compromise measure substituted for the stronger guarantee of local
autonomy proposed during the constitutional convention. President Quezon preferred to
appoint the chief officials of cities and would brook no "democratize nonsense".25

During the 1934 – 1935 Constitutional Convention, emerging Filipino leaders were group
into two camps: those who favor stronger local government, and those who consider state
control more important than local governments. The second group won. Thus, the 1935
Constitution had no separate article on local governments, in contrast with the two
succeeding constitution of the Philippines. In addition, the 1935 Constitution formally
created a very powerful Philippine president. Thus, the trend during the Commonwealth
period, the transitional government before the granting of independence, was
centralization. Aside from the state-control bias of the 1935 Constitution, some writers
also attribute the centralization trend to the strong leadership style of President Manuel
Quezon. Quezon believed that under a unitary system, the national chief executive should
control all local offices. The result was that central supervision rapidly increased and was
personally exercised by the president to a degree previously unheard of. However, as
Hutchcroft noted, Quezon was primarily concerned with centralizing control over
patronage resources. Thus, he achieved great success in establishing central-local
relations aimed at electoral objectives rather than promoting administrative effectiveness.

24
Ocampo and Panganiban, op. Cit., p. 5
25
Brillantes Cit.

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Formal centralization continued during the brief Japanese occupation (1942 – 1945). As
in the case of the Spanish and American colonization of the Philippines and especially
since there was a world war going on, an even greater degree of central control was
imposed on local governments by the occupying power through a national government
where Filipinos collaborators, still from the local elites that cooperated with the
Americans, held positions.

Philippine political independence was granted by the Americans in 1946. The first local
autonomy act (RA 2264) was enacted in 1959, entitled, "An Act Amending the Laws
Governing Local Governments by Increasing their Autonomy and Reorganizing
Provincial Governments". This act vested in city and municipal governments greater
fiscal, planning and regulatory powers. It broadened the taxing powers of the cities and
municipalities within the framework of national taxing laws.26

The year 1959 also saw the passage of landmark legislation as afar as local autonomy is
concerned. The Barrio Charter Act (RA 2370) sought to transform the barrios, the
smallest political unit of the local government system into quasi-municipal corporations
by vesting them some taxing powers. Barrios were to be governed by an elective barrio
council. Less than a decade later, the "Decentralization Act of 1967" (RA 5185) was
enacted. It further increased the financial resources of local government and broadened
their decision-making powers over administrative (mostly fiscal and personnel) matters.27

More specifically, the Decentralization Act provided that it will:


Grant local governments greater freedom and ampler means to respond to the
needs of their people and promote prosperity and happiness to effect a more
equitable and systematic distribution of governmental power and resources. To
this end, local governments henceforth shall be entrusted with the performance
of those functions that are more properly administered in the local level and

26
Brillantes Cit.
27
Brillantes Cit.

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shall be granted with as much autonomous powers and financial resources as are
required in the more effective discharge of their responsibilities.28

By any measure, the imposition of martial law in 1972, which abolished local
elections and vested in the dictator the powers to appoint officials who were
beholden to him, was a great setback for the local autonomy movement in the
Philippines. Notwithstanding the highly centralized dictatorial set-up, the 1973
Marcos Constitution rhetorically committed itself to a policy of local autonomy:

The State shall guarantee and promote autonomy of local government units, especially
the barrio, to ensure their fullest development as self-reliant communities.29

The document likewise constitutionalized the taxing powers of local government


units thus:
Each local government unit shall have the power to create its own sources of
revenue and to levy taxes subject to limitations as may be provided by law.30

However, the President continued to exercise "supervision and control" over the
local governments. The authoritarian government promulgated the Local
Government Code of 1983 (Batas Pambansa Bilang 337) which reiterated the policy
of the State to guarantee and promote the autonomy of local government units to
ensure their fullest development as self-reliant communities and make them
effective partners in the pursuit of national development.31

Obviously, genuine autonomy could not be realistically implemented under the


authoritarian regime.32

28
Ibid.
29
Brillantes cit.
30
Ibid.
31
Ibid.
32
Ibid.

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From the granting of formal independence in 1946 until 1972, the general trend had been
toward the decentralization. Until 1950, national executive departments made all
administrative appointments at the provincial and municipal levels. However, they were
generally made in consultation with the local political elite. A number of laws passed by
Congress gave greater autonomy to local government through the grant of additional
powers or the lessening of national control on local affairs. Significant legislative
enactments include the Local Autonomy Act (Republic Act RA 2264), the Barrio Charter
(RA 2370, later amended by RA 3590), and the Decentralization Act of 1967 (RA 5185).
The Supreme Court also contributed to the cause of local autonomy by moving away t a
liberal to a narrower interpretation of constitutional power of the president to supervise
local governments. The decentralization trend culminated in the inclusion of a separate
article on local government in the draft of the new constitution and the draft Integrated
Reorganization Plan (IRP). The draft constitution contained provisions guaranteeing local
government autonomy, local power to create their own sources of revenue and to levy
taxes, greater citizens’ draft IRP, meanwhile, strengthened the regions. But under the
draft law, LGUs were still supervised through the office of the President and the various
departments.33

Furthermore, central-local relations in the Philippines before the declaration of martial


law in 1972 differed from other developing Asian countries that were characterized by
the widespread phenomenon of tight central control at the time. According to Friedman,
this difference sprang from the country’s colonial heritage and reflected formal,
structural, alternatives, albeit unaccompanied by new conceptions of government. Before
the 1970s the Philippines already had constitutionally differentiated provincial
governments and a variety of elected governing bodies and officials at the city,
municipal, and barrio levels. Friedman continued that while financial resources needed
for governing were always lacking, “a complicated and politically influenced system of
grants” made the Philippine local government system more autonomous than in other
Asian countries. While this type of system generated its own benefits as well as

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problems, “the potential for continued development” that is not discernible everywhere in
Asia existed in the Philippines.

After the 1896 EDSA People Power Revolution toppled the Marcos dictatorship, the
Philippine government headed by Corazon Aquino renewed its commitment to greater
decentralization as a means of attaining its development goals and objectives. This was
expressed in the goals of the new administration’s development program (“the Policy
Agenda for People Oriented Development”). The program stated that the role and
structure of government would be guided by the key organizational principles of
decentralization, among others. The administration’s commitment to achieving greater
decentralization was further reinforced by the extensive provision on local autonomy in
the 1987 Constitution. Article 2 (Declaration of Principles and State Policies), Section 25,
says: “The State shall insure the autonomy of local governments.” There is also a
separate State shall insure the autonomy of local government (Article 10) that is more
extensive than its counterpart in the 1973 Constitution. Article 10 has the following very
important provisions:
1. Creation of autonomous regions in Muslim Mindanao and the Cordillera.
2. Granting LGUs the power to create their own sources of revenue and to levy
taxes which shall be automatically released to them.
3. Providing local governments with a just share of the national taxes which shall
be automatically released to them.
4. Entitling local governments to an equitable shares in the proceeds of the
utilization and development of the national wealth within their respective areas.
5. Providing for regional development councils for other similar bodies
composed of local government officials, regional heads of departments and
other government offices, and representatives from NGOs within the region for
purposes of administrative decentralization to strengthen the autonomy of the
units thereon and to accelerate the economic and social growth and
development of the units in the region.34

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The provision of the 1987 Constitution would serve as the legal precedent for the
enactment in 1989 of two laws creating autonomous regions in Muslim Mindanao and the
Cordilleras. Then, in 1991, after almost five years of debate in Congress, the Local
Government Code or RA 7160 was enacted. This law is by far the most focused on
devolution and democratic decentralization in the country. It is also considered the most
important piece of legislation to emerge from the Aquino administration.

The 1991 LGC is a product of both external factors, although internal factors play a
stronger role in terms of the actual contents of the legal basis as well as the dynamics of
its implementation. Decentralization has been carried out not solely for the traditional
public administration arguments but, more important, in light of its democratic
dimensions and other political considerations. There are mixed motives and a conjuncture
of political factors in the decision to undertake decentralization. First, there are practical
and administrative reasons. For decades and peaking with Marcos’s dictatorship, a formal
centralized structure failed to deliver services. This failure is especially relevant in a
diverse archipelago of thousands of islands. In addition, overly centralized formal
mechanisms limited prospects for development in the countryside.

Second, The Philippines undertook decentralization after the overthrow of Marcos for
idealistic reasons. President Aquino, civil-society groups, various leagues of local
governments, and some national legislators genuinely felt that decentralization and local
autonomy were more than administrative innovations. They were tools toward achieving
democratization and vice versa. The Code was meant to be centerpiece of a government
that came into power by overthrowing a dictatorship.

Finally, political leaders also have personal reasons for undertaking decentralization.
Obviously, traditional local politician saw the new benefits they would reap from
devolution. More important, subject to the new constitution’s imposition of term limits,
members of the House of the Representatives were motivated by a desire to assume local
government positions in the failure in an environment where significant powers and
finances have been devolved to LGUs. In terms of timing of the Code’s approval, many

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legislators were also motivated by a desire to get reelected or get elected to higher
positions in the coming elections.

Philippine politico-administrative history is replete with examples of tensions between a


highly centralized governmental structure and the demands for autonomy among the
various component local units: at one level, there is an imperative for a dominant and
assertive leadership necessary for the consolidation and even the very survival of a weak
state; at another level, there is demand among component local institutions for autonomy
from the central government in order to enable them to become more responsive to
situations obtaining locally and, paradoxically, strengthen a weak state.

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Earlier historical attempts to decentralize power and authority to local institutions
through various means are testimony to the fact that the problem of overcentralization is
one that has been recognized - but continued to persist - through the years. For instance,
the decentralization of administrative authority (but conspicuously unaccompanied by
political decentralization) was a hallmark of the Marcos dictatorship. A Local
Government Code was in fact enacted in 1983. But these attempts at decentralizing
government remained simple administrative formalisms. Power continued to be
concentrated in Manila with local units heavily dependent upon central government. In
fact, before the enactment of the Code, local governments were beginning not only to be
restive but also assertive, demanding that the umbilical cord that tied them to Manila be
severed because this was the root cause behind their stunted growth and
underdevelopment.

With Philippines' archipelagic nature, it is no wonder that the Philippine government had
made lots of experiments to find the most suitable way to govern the country. The
reinforcement of a centralized and decentralized government varied from the pre-colonial
barangay to the 1991 Local Government Code. A lot of factors triggered such trend
variation. Aside from the country's geographic nature, which hindered the successful
consolidation of all islands under the control of one government, the public officials were

3514
Brillantes, Cit.

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not yet properly trained or educated on the implementation of government's policies and
procedures to prevent unethical acts such as corruption and red tape. Despite of this,
decentralizing the government has been the best option to effectively implement
government's programs and policies, wherein the provinces, cities, municipalities and
barangays of the nation enjoys local autonomy which are then generally supervised by a
central government.36And because of a greater degree of accountability, responsiveness
and participation, effective decentralization can make a big difference by making the
provision of local (social and economic) services more efficient, equitable, sustainable
and cost-effective. Through community participation in decision making, planning,
implementation and monitoring and backed by appropriate institutions and resources, it
can go a long way in improving the quality of life, particularly of the poorer and
marginalized sectors of the population, thereby alleviating poverty.

THE LOCAL GOVERNMENT SYSTEM AND CHANGES BROUGHT ABOUT


THE 1991 LOCAL GOVERNMENT CODE

3615
<http://www.idrc.ca/en/ev-115661-201-1-DO_TOPIC.html >

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The passing of RA 7160 or the Local Government Code (LGC) contain five major
features which gave noteworthy supremacy to those local government units (LGUs). It
transfers the responsibility for the delivery of various aspects of basic services plus some
regulatory and licensing powers to the local governments. It also increases the financial
resources available to LGUs, lays down the policy framework for the direct involvement
of civil society, most especially non-government organizations and people’s
organizations in the process of local governance, and encourages LGUs to be more
entrepreneurial.37 These are as follows: 1.) the code devolves or transfers the
responsibility for the delivery of various aspects of basic services to the local
governments. Most significant devolved services include health, agriculture, environment
and natural resources, social services and public works funded by local funds. 2.) The
code transfers certain regulatory and licensing powers to local governments. These
include reclassification of agricultural lands, enforcement of environmental laws,
inspection of food products and quarantine, enforcement of National Building Code,
operation of tricycles, processing and approval of subdivision plans, and establishment of
cockpits and holding of cockfights. 3.) It increases the financial resources available to
LGUs by broadening their taxing powers, providing them with specific share from the
national wealth exploited in their area, and increasing their automatic share from national
taxes.4.)It lays down the policy framework for the direct involvement of civil society,
most specially NGOs and Pos, in the process of local governance – some degree of
debureaucretization. These openings for civil society are meant to promote not only
popular participation but also local accountability and transparency. Finally, 5.) The code
encourages the LGUs to be more entrepreneurial by providing them with opportunities to
enter into joint ventures with the private sector, engage in the BOT arrangements, float
bonds, and obtain loans from local private institution and the like. In a sense, the code
encourages them to be less reliant on the national government instead generate their own
resources but still the President has the authority to exercise general supervision over the
LGU delegated to the DILG – the successor of the pre – martial department of local
government and community development. More specifically, this could be done through
the following: First, sectoral representation in local legislative councils, particularly those

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represents women, worker, and other sectors as determined by the specific Sanggunian.
( either sanggunian panlalawigan, panglungsod, sanggunian kabataan and the like);
second, through allocation of specific seats for NGO and PO representative in local
special bodies (like the local development council, the local health board, and the local
school board);third, participation in political exercises like plebiscite, referendum, and
recall.; and lastly, involvement in the planning and implementation of development
programs. Moreover, the present local government unit creates criteria according to the
1991 Local Government Code. The country has existing levels on the local government
which has an elected set of chief executive and members of a legislative body called
sanggunian as well as bureaucracy. The levels of the government include the provinces,
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cities, municipalities, and the village-level barangay. This shows that there exists an
established administration on the local sector. However, in the case of cities, higher-
income cities are autonomous and classified as highly urbanized or chartered cities, while
the rest are component cities that, like the municipalities, are under provincial
supervision.39 When a city is already considered as a highly-urbanized one, it becomes
independent to the provincial government. However, when it has not yet reached the level
of being a chartered city, then, it still remains under the authority of the provincial
government.

DEVOLUTION’S IMPACTS, ISSUES AND CHALLENGES

“Local government indeed plays a central role in any democratizing polity. For one,
being in the frontline, they are regarded by many citizens as the government. If local
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governments fail and are unresponsive to the basic needs of the people then government
to those people is a failure, regardless of the grandiose plans and visions it has. The
increased role of governments in the democratizing polity may also be seen within the
context of global trends and development. The rapid breakdown of many centralized
institutions has led to the observation that the “center cannot hold”. While the
implementation of the code may not have been a smashing success, it may be rightfully
claimed that it has not been a failure either. A high point in the battle for devolution was
the presidential veto of the proposed bill to recentralize health services. If anything, this
maybe a major indicator of the current leadership’s political will to follow through the
devolution process. The support of the various concerned agencies to increase the LGU’s
absorptive capacities, through the preparation of guidelines and even developing various
capability programs with appropriate institution also augurs well for devolution.” The
most controversial issue in decentralization is implementation in the real world. It
presents problem which are as follows: first is that a significant number of LGUs “refuse
and hesitate to accept the devolved functions and services for reasons such as limited
financial resources to maintain and sustain the operations of the offices charged with the
functions and delivering the devolved services”40. For example the health practitioners,
they are now the responsibilities of the LGUs and be compensated with accordance of the
Magna Carta involving heath services41Next are the problems which have something to
do with personnel management, because some of them do not want to be directly under
the control and supervision of the local executives, especially those devolved personnel
from the national agencies. According to the Legaspi there are concerns on to what extent
the basic services and functions which includes financial allocations from the national
government and support facilities be transferred to the LGU’s because it is not clearly
defined. Indeed there are things to be settled until it can be said that the decentralization
in the country is successful.

“However, it is important that the devolution process not be romanticized and seen as the
end-all and panacea for all our problems. National government certainly still plays a
40
Decentralization, Autonomy and the Local Government Code: The Challenge of Implememtation.
edited; Legaspi, Perla. Local Government Center ,College of Public Administration, University of the
Philippines and Ford Foundation. Philippines, 1995. p 2
41
Philippine Politics and Governance: An Introduction. Edited: Morada, Noel. Tadem, Teresa.

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critical role in the overall development process. The preparation and development of
standards, redistribution of resources and identification of projects and activities that
national government can finance given its unique capabilities and perspectives still are
areas where it has some comparative advantage and therefore demonstrate competence”42.

42
Democritization: Philippine Perspectives. Miranda, Felipe. University of the Philippines Press. Diliman,
Quezon City, 1997, p. 98,99

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