Notes from the Field

To Increase Transparency, Make Local Budgets Public in the Philippines

November 3, 2010

Local government budgets in the Philippines are by nature public and are important instruments for policy making and planning. But, inequities often emerge when local officials monopolize allocation decisions, which do not always reflect the priorities of the people who rely on local government services such as health care, social services, and low-cost housing for survival.

Historically, civil society organizations (CSOs) have played a critical role in improving the local budgeting process. Their engagement with local governments not only enhances transparency by revealing how funds are allocated, but also increases legitimacy by opening dialogue and building consensus.

The Philippines is replete with legal frameworks to ensure transparency in governance, including the budgeting process. The 1987 Philippine Constitution calls for the State to adopt and implement a policy of full disclosure of all transactions involving the public interest, and provides the people with the right to access public information.

The 1991 Local Government Code further strengthens these constitutional provisions by including representatives of non-government organizations in local special bodies to ensure checks and balances in the allocation of local government resources and the prioritization of programs and projects in ways that are responsive to the needs of the people. Although the same Code made no mention of civil society participation in local budgeting process, it does require local governments to post in publicly accessible and conspicuous places a summary of all revenues collected and funds received, including the appropriations and disbursements of such funds 30 days after the end of each fiscal year.

In spite of these laws, only a few local governments have tried to promote an open and transparent budgeting process. For example, the city of Naga had by 1995 already enacted its Empowerment Ordinance that put in place a mechanism for people’s participation, and bestowed powers upon the Naga People’s Council (a federation of non-government and citizen organizations in the city) to appoint representatives to all local government special bodies, task forces, and committees – including the Local Finance Committee (LFC), where civil society organizations examine how funds are used. A few years ago, Naga City began posting its budget and expenditures on its website as well. In 2009, Antipolo City initiated a one-day budget forum as an avenue to encourage stakeholders’ participation in resolving budget-related issues and concerns. But for most, the budget process is considered to be confined within the local government, permitting only local officials to make important decisions.

In a local government in southern Philippines, for example, one must first get the approval of the previous mayor in order to obtain a copy of the budget document. In another municipality in the north, a mayor refused to divulge their general appropriations even though these are supposed to be “public” documents. Indeed, in most instances, a budget document is considered confidential, and not easily available nor accessible to ordinary citizens. In order to receive a copy, people must send a formal letter addressed to the local chief executive explaining the purpose and reason for the request and, often, must wait a couple of days before actually seeing the document.

The 11th Rapid Field Appraisal of Decentralization conducted by The Asia Foundation further affirms this lack of transparency in local governments. The RFA reveals that 19 years after decentralization, there are still shortcomings in disclosing adequate information to the public. Very few local governments provide information on financial reports and transactions, with the majority releasing only general information on projects, activities, and accomplishments. Such limited information available to the public also limit the opportunities for public scrutiny and feedback.

Fortunately, President Aquino has made fighting corruption and enhancing transparency and accountability in governance one of his major platforms for reform. With the issue of corruption plaguing the Philippine bureaucracy – with constant allegations of fraud and mismanagement of public funds – this is welcome news.

In support of the new administration’s platform, The Asia Foundation launched the Budget Tracking for Transparent Accountable Governance (BTTAG) project on Sept. 2, 2010, in three provinces and 17 cities in Mindanao. BTTAG monitors the budgeting process of local governments from budget preparation and review authorization to execution to determine if local governments’ budgets are aligned with their respective plans and programs and reflect the needs of the local citizens.

Budget Signing

Pat Sarenas, chair of Mindanao Coalition of Development NGO Networks, signs her commitment for the Budget Tracking for Transparent Accountable Governance project, launched by The Asia Foundation.

At the BTTAG project launch, Department of the Interior and Local Government Secretary Jesse Robredo emphasized that, “leadership is a shared responsibility. … If we have to impose the obligation on the constituency, it is necessary that they should know why we are imposing these obligations. If we need to raise taxes, the people have the right to be informed how we are using public money, and the only way to inform them is to open the books – to become transparent.” To encourage local governments to be more transparent, Secretary Robredo recently signed a memorandum encouraging local government executives to fully disclose their local budgets and finances, bids, and public offerings to the public by posting them in conspicuous places within public buildings, in print media, and on local government websites.

Accomplishing this type of far-reaching reform across the Philippines is a tall order, but there is certainly a renewed hope for local governments, especially under the new Aquino administration, where transparency, accountability, and citizen participation are top on the agenda.

Nadine S. Ragonjan is a program officer in The Asia Foundation’s Manila office. She can be reached at nragonjan@asiafound.org.

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2 comments on this post:

  1. Nadine Ragonjan:

    Hi Orlando, The Asia Foundation does have data from DILG as of 2nd quarter of 2012 but we can refer you to the Bureau of Local Government Supervision for the latest data as ofFebruary 2013. You may contact their office at 63.2.9250373. They can share with you the summary of local governments’ compliance. For more information, visit DILG’s Full Disclosure Policy Portal at http://fdpp.blgs.gov.ph/. Hope this helps. Thank you.

  2. Orlando R. Garcia:

    Do you have any data on the present status of compliance of former Sec. Robredo’s
    directive to be transparent, accountable and encouraging citizen participation anong our LGUs? It seems that after his death his directive on transparency ,accountability and citizen participation have gone to oblivion or joined him in the murky waters in Masbate.

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