INSTITUTIONAL MAPPING AND

ANALYSIS OF ORGANIZATIONS
EFFORTS, INITIATIVES AND
ASSISTANCE TO LOCAL FINANCIAL
PLANNING AND MANAGEMENT

Rufo Mendoza, Ph.D.

June 2007
 DISCLAIMER

“The views expressed in this report are strictly those of the authors and do not necessarily reflect those of
the United States Agency for International Development (USAID) and the Ateneo de Manila University”.
 Abstract

This project report discusses various forms of support provided to local government
units (LGUs) in local financial planning and management (LFPM). It aims to provide
an inventory and a consolidated report of organizations or institutions that support the
progress of financial planning and management in LGUs. The principal findings of
this study are firstly, LFPM institutional assistance at the local level is limited.
Secondly, national government agencies and international finance institutions provide
financial, technical and policy assistance while academic institutions, nongovernment
organizations and to a certain extent the LGUs themselves focused on technical
assistance. Finally, LFPM assistance impresses upon local chief executives the
relationship between local government fiscal performance and managerial
enhancement.
 TABLE OF CONTENTS

Page

List of Tables iv
List of Figures v
List of Appendix Tables v
List of Appendices v
Acronyms and Abbreviations vi
Preface and Acknowledgments ix
1
1. Introduction
1
2. Rationale for The Study
3
3. Research Framework and Methodology
6
4. Types and Nature of LFPM Assistance

5. Areas of LFPM Assistance 16

Revenue Generation 16
Government Accounting 21
Internal Auditing 21
Local Government Budgeting 22
Local Economic Development 22
Local Development Planning 24
Procurement Process 25

6. Specific Assistance by Donors in LFPM 27

Donor Activity in the Philippines 27
A. Asian Development Bank 27
B. Asia Foundation and Transparent Accountable Governance 28
C. Australian Agency for International Development 29
D. Canadian International Development Agency 31
E. Japan 32
F. New Zealand Aid for International Development 33
G. United States Agency for International Development 33
H. The World Bank 33

Training Programs and Courses in LFPM Offered by Local Institutions 42

A. Ateneo School of Government 35
B. Asian Institute of Management 36
C. Development Academy of the Philippines 36
D. Local Government Academy 37
E. Institute of Development Management and Governance, UP Los Baños 38
F. Local Governance Training and Resource Institutes Philippine Network 38

ii
7. Institutional Arrangements 40
Methods of Tapping LGU Beneficiaries 40
Forms of Working Arrangements 40
Provision of LFPM Support as Mandate 43
Interest for Partnership with EPRA 44

8. Facilitating Factors in LFPM 45

Objectives of Support 45
Political Feasibility 46
Staff Behavior 47
Institutional Processes 48
Participatory Approach 49
Financial Accountability 50
Financial Transparency 50

9. Description of Constraints in LFPM Assistance 53

Common Areas of Confusion 53
Difficulties 54
Not Difficulties 55

10. Gaps and Overlaps in LFPM 59

Mismatch of LFPM Assistance with Current Demands in Local Governments 59
Competing or Conflicting Roles of Government Institutions 60
Weak Coordination Among NGOs to Consolidate and Direct their 60
Assistance to LGUs
Loose Internal LGU Financial Management 61
IRA-Related Issues 62
Grey Areas in Local Development Planning 63

11. Summary of Findings 64

Limited LFPM Institutional Assistance at the Local Level 64
Role Differentiation Not Meeting Current Needs 64
Fiscal Performance and Managerial Enhancement 64
Matching of Assistance with Current Demands 66
Harmonization of Functions among Government Institutions 67
Enhancing the Functioning of Networks 68
Strengthening the Internal Financial Management of LGUs 68

References 72

Appendix Table 73

Appendices 75

iii
 LIST OF TABLES

TABLE TITLE PAGE

1 Process Flow of Discussion of LFPM Assistance 6

2 Types, Description, Areas of LFPM, and Nature of Assistance 7
3 Gawad Galing Pook Applicants and Awardees by Categories 9
4 Sources of LGU Revenues 14
5 Types and Nature of Assistance by Groups of Providers 15
6 LGUs with Bond Issuance 18
7 LGUs with BOT Projects 20
8 Areas of LFPM and Assistance Provided in Each Area 26
9 List of LFPM and LFPM-Related Courses and Providers 39
10 Number of Organizations with Mandate to Provide Support in LFPM 43
11 Number of Organizations with Interest for EPRA Partnership 44
12 Seven Facilitating Factors in LFPM 45
13 Percentage Scores of the Objectives of Support 46
14 Percentage Scores on Political Feasibility 47
15 Percentage Scores on Staff Behavior 48
16 Percentage Scores on Institutional Processes 49
17 Percentage Scores on Participatory Approach 50
18 Percentage Scores on Financial Accountability 51
19 Percentage Scores on Financial Transparency 52
20 Assessment of Funding Limitations 54
21 Scarcity of Individual Competence 55
22 Assessment of Linkaging Activities 56
23 Assessment of Information Dissemination 56
24 Assessment of Interest of Local Officials 57
25 Assessment of Political Interference 57
26 Assessment of Policy Conflict 58
27 Assessment of Geographical Dispersion of LGU Beneficiaries 58
28 Least Provided LFPM Assistance 59
29 Gaps and Overlaps in LFPM Assistance 61
30 Some Potential Policy Action Arenas for EPRA 70

iv
 LIST OF FIGURES

FIGURE TITLE PAGE

1 Operational Framework for the Institutional Mapping of Support

Systems to LFPM and Institutional Analysis 3
2 Outputs from Support to LFPMS 42
3 LFPM Assistance Map 65
4 Competency-Based Education Framework for Oversight Function in
Academic Institutions 67

LIST OF APENDIX TABLES

APPENDIX TITLE PAGE

TABLE
1 Inventory Count of Support in LFPM 73
2 Inventory of Support (In Percentage) 74

LIST OF APPENDICES

APPENDIX TITLE PAGE

A List of Respondents 75
B Selected List of Books, Researches, and Studies on Local Financial 79
Planning and Management
C Survey Questionnaire 85

v
 ACRONYMS AND ABBREVIATIONS

ADB Asian Development Bank

ADMU Ateneo de Manila University
AGIA Association of Government Internal Auditors
AIM Asian Institute of Management
ALRF Assessment Loan Revolving Fund
APP Annual Procurement Plan
ARMM Autonomous Region of Muslim Mindanao
ASF Andres Soriano Foundation
ASG Ateneo School of Government
AusAID Australian Agency for International Development
BLGD Bureau of Local Government Development
BLGF Bureau of Local Government Finance
BLGS Bureau of Local Government Supervision
BOT Build-Operate-Transfer
BTEP Business Tax Enhancement Program
CBETA Competency-Based Education, Training, Assessment, and Accreditation
CBO Community-based Organizations
CBRM Community-Based Resource Management
CCPSP Coordinating Council for Private Sector Participation
CD Community Development
CDD community-driven development
CDS City Development Strategies
CHED Commission on Higher Education
CIDA Canadian International Development Agency
CLRG Center for Local and Regional Governance
CLUP Comprehensive Land Use Plan
COA Commission on Audit
CREMDEC Cebu City Resource Management and Development Center
CSO Civil Society Organization
CSC Civil Service Commission
DA Department of Agriculture
DAP Development Academy of the Philippines
DAR Department of Agrarian Reform
DBM Department of Budget and Management
DBP Development Bank of the Philippines
DILG Department of Interior and Local Government
DLSU De La Salle University
DOF Department of Finance
DSWD Department of Social Welfare and Development
DTI Department of Trade and Industry
EPRA Economic Policy and Reform Advocacy Program
GFIs Government Financial Institutions
GIS Geographic Information System
GOCCs Government Owned and Controlled Corporations
GOP Government of the Philippines
GPRA Government Procurement Reform Act
HRD human resources development
IDMG-UPLB Institute of Development Management and Governance, University of the Philippines
Los Banos
IEC Information, Education and Communication
IFIs International Financial Institutions
ILO International Labor Organization
IPD Institute of Politics and Development

vi
IRA Internal Revenue Allotment
IT information technology
JBIC Japan Bank for International Cooperation
JFLFI Julio and Florentina Ledesma Foundation, Inc.
JICA Japan International Cooperation Agency
JSDF Japan Social Development Fund
KALAHI Kapit-Bisig Laban sa Kahirapan
LBP Land Bank of the Philippines
LCE Local Chief Executive
LCP League of Cities of the Philippines
LDC Local Development Council
LFPM Local Financial Planning and Management
LGA Local Government Academy
LGC Local Government Code
LGSP Local Government Support Program
LGSPA Local Government Support Program in ARMM
LGU Local Government Units
LGUGC LGU Guarantee Corporation
LLDA Laguna Lake Development Authority
LOGOFIND Local Government Finance and Development Project
LoGoTRI-PhilNet Local Governance Training and Resource Institutes Philippine Network
MDF Municipal Development Fund
MDFO Municipal Development Fund Office
MNLF Moro National Liberation Front
MOA Memorandum of Agreement
MST Multi-stakeholder Team
NATCCO National Confederation of Cooperatives
NCPAG-UPD National College of Public Administration and Governance, University of the Philippines
Diliman
NDCC National Disaster Coordinating Council
NEDA National Economic and Development Authority
NGA National Government Agency
NGAS National Government Accounting System
NGOs Non-Government Organizations
NZAID New Zealand’s International Aid and Development Agency
OCOV One Cluster, One Vision for Local Government
ODA Official Development Assistance
PACAP Philippines-Australia Community Assistance Program
PAGBA Philippine Association of Government Budget Administrators
PAHRDF Philippines-Australia Human Resource Development Facility
PALS Philippines-Australia Local Sustainability
PASTT Philippines-Australia Short-Term Training Facility
PATSARRD Philippines-Australia Technical Support for Agrarian Reform and Rural Development
PBSP Philippine Business for Social Progress
PDF project development facility
PICPA Philippine Institute of Certified Public Accountants
PNB Philippine National Bank
PO Peoples Organisations
PSEEAP Public Service Excellence, Ethics and Accountability Program
PSLP Asia Public Sector Linkages Program
PTTAF Policy, Training and Technical Assistance Facility
PVB Philippine Veterans Bank
RA Republic Act
RPT Real Property Tax
SEC Securities and Exchange Commission
TA Technical Assistance

vii
TAG Transparent Accountable Governance
UNDP United Nations Development Programme
UP University of the Philippines
UPOU University of the Philippines Open University
UPSURP UP School of Urban and Regional Planning
USAID United States Agency for International Development
WB World Bank
WDDp Water District Development Project
WWF Worldwide Wildlife Foundation

viii
 PREFACE AND ACKNOWLEDGMENTS
This final report on the project “Institutional Mapping and Analysis of Organizations’ Efforts, Initiatives,
and Assistance to Local Financial Planning and Management (LFPM)” identifies and describes the
various support provided to the LGUs in the form of efforts, initiatives, and assistance in LFPM. The
project aims to provide an inventory and a consolidated report on organizations or institutions that support
the progress of financial planning and management in LGUs.

This is the first time that the theme of local financial planning and management has been mapped and
reported. The results will provide the Economic Policy and Reform Advocacy (EPRA) program a
significant opportunity to gain a general understanding of and explore possible solutions to LFPM
directly from institutional providers and beneficiaries. Thus, the study also determines the most important
needs as well as constraints and challenges in LFPM that can, in the long run, help LGUs manage their
LFPM effectively and efficiently. The project commenced in late January 2006. The preparatory work
and data gathering for a national inventory of institutions started on the second week of February and
ended in March 2006.

This study is the collective efforts of individuals who have shared their ideas and time. The project
gratefully acknowledges EPRA and its Executive Director, Dr. Cielito Habito, for believing in the
research study and for extending the necessary expert guidance to the project. Ms. Deanna Lijauco, Ms.
Gmelina Guiang, and the rest of the EPRA staff provided practical inputs and overall management
support for the project. Mr. Austere Panadero, Assistant Secretary of the DILG provided constructive
suggestions. The Leagues of Cities of the Philippines and its president, Mayor Jerry Trenas endorsed the
survey and Executive Director Atty. Gil Cruz and Ms. Hazel Biniza facilitated the survey through his
assistance. Mr. Norberto Malvar and Ms. Pamela Quizon of the BLGF shared their invaluable insights on
the current situation of local finance. Dean Corazon Abansi of De La Salle Lipa shared insightful
comments on the survey checklists. Mr. Gorgonio R. Virrey, Ms. Carla Gonzales-Jimena and Ricardo G.
Buraga provided administrative assistance and Dr. Serlie Barroga-Jamias helped in editing the report.

Finally, the respondents—staff and officials of national government agencies, local government units
(LGUs), NGOs, international donors, and academic institutions—who provided vital contributions as
active participants and inspirations.

This Institutional Mapping Report would hopefully assist LGUs and institutions to take actions where
LFPM assistance is needed most.

ix
1. INTRODUCTION

1.1 The Local Government Code (LGC) of 1991 (Republic Act No. 7160) has changed many features
of Philippine local governance. The Code enables the local government units (LGUs) to exercise their
power to create and broaden their own sources of revenue and claim their right to a just share in national
taxes. It also gives the LGUs the power to levy taxes, fees or charges that would accrue exclusively for
their use and disposition. Thus, LGUs no longer confine themselves with the traditional sources of
revenues; they are also engaged in credit financing, bond floatation, and other non-traditional schemes to
enable them to finance local development programs and projects. More importantly, they can avail of
credit facilities from both public and private financial institutions to finance infrastructure and other
socio-economic development projects. This fiscal decentralization afforded to LGUs has made sound
local financial planning and management (LFPM) very important in Philippine local governments.

1.2 Following the grant of autonomy to LGUs, some organizations have opened opportunities for
LGUs to improve their capacity to raise revenues and to spend money for effective governance and
delivery of important basic services to their constituents. The national government, in particular, has
provided facilities to enhance the capacity of local governments in planning and managing their financial
resources. International organizations and funding agencies have provided funding sources not only to
strengthen the management capacity but also to realize the development goals of the LGUs. Both public
and private financial institutions have offered options to finance local development initiatives. The non-
government organizations (NGOs) have also re-focused their strategies to enhance participatory local
governance among many LGUs. Furthermore, academic institutions have continued to support the LGUs
in discovering new technologies and in disseminating knowledge.

2. RATIONALE FOR THE STUDY

2.1 Years after the enactment of the Code in 1991, the idea of complete autonomy for LGUs has yet
to be fully realized. The LGUs have not fully exercised their inherent fiscal powers as autonomous
governments. Indeed, it is generally believed that the local governments have not explored the available
financial packages within their reach. Currently, less than 10 percent of all the 1,696 LGUs exercise their
new financing mandate (Amatong, 2005). Only 21 or 1.24 percent of all LGUs have issued bonds
(BLGF, 2005) and only 15 or 0.88 percent have build-operate-transfer (BOT) projects (BOT Center,
2005). The Galing Pook Foundation (2006) has documented only 8 (4.8%) of 171 awardees that are
finance-related. Given the multitude of support mechanisms and policies of the organizations involved in
the development of financial planning and management, it is necessary to conduct an institutional study
that will determine the status of support provided by the various organizations.

2.2 The general powers and attributes of LGUs in the Philippines are found in Chapter 2 of the LGC
of 1991 which explicitly described the political and corporate nature of LGUs. Section 14 states that
“when a new local government unit is created, its corporate existence shall commence upon the election
and qualification of its chief executive and a majority of the members of the sanggunian.” This is further
reinforced by Section 15 which states “every local government unit is a body politic and corporate
endowed with powers to be exercised by it in conformity with law. As such, it shall exercise powers as a
political subdivision of the national government and as a corporate entity representing the inhabitants of
its territory.” LFPM is broadly classified under the corporate functions and powers of the LGUs. Since
the enactment of the Code in 1991, however, the corporate functioning seems to be the weakest link in the
financial management chain of the LGU.

2.3 This study consists of an institutional mapping of on-going support to LFPM and an institutional
analysis of selected LGUs through a case documentation of innovative LFPM practices that harness inter-
local cooperation. The institutional mapping identifies and describes the various forms of support—
efforts, initiatives, and assistance—provided to LGUs; these terms are used interchangeably in this study.
Institutions cover all forms of organizations: government and non-government organizations,
international finance institutions, and academic institutions. The mapping is divided into two phases: (1)
inventory and consolidation of organizations or institutions, and (2) interpretation of data to determine the
following: organizational relevance, importance and impact on the Economic Policy and Reform
Advocacy (EPRA) Project; difficulties and constraints; facilitating factors; and gaps and overlaps.

2.4 The institutional analysis also has two phases: (1) selection of LGUs, and (2) analysis of selected
LGUs. The latter assesses the extent of involvement and participation of the LGUs’ Local Finance
Committees and Local Development Councils in the planning and budget management processes, in the
authorization procedures, and in the leadership patterns in the planning process. The second phase
evaluates processes that underlie the LGUs’ LFPM practices and their openness to partner with the EPRA
Project.

2.5 The baseline information generated will assist the EPRA Project and its multi-stakeholders team
(MST) in identifying priority action arenas and in exploring partnerships with other players engaged in
LFPM. The study can also provide various institutions some bases for strategic thinking and policy
directions which may redound to the best interest of the LGUs and the communities. The study is the first
comprehensive initiative on LFPM mapping in the Philippines, thus the information will constitute the
principal database in LFPM assistance to the country.

2.6 Basically, the study was constrained by the lack of comprehensive and available baseline
information to establish LFPM assistance. Updated directories of institutions in local governance and
development were also hard to find, hence forcing the researchers to exert extra effort in identifying the
respondent institutions. Further, there were really no specific persons in the LGUs who can claim direct
LFPM responsibilities.

2.7 Because only a few institutions were fully engaged in LFPM, the study made an inventory of
institutions covering sector-specific programs and projects with thrust in local governance. This way, the
study was approached in both contexts: (a) with LFPM as the main field of service of the institutions, and
(b) with LFPM as a component of programs and projects.

2.8 Theoretically, the study reflects a commitment to serious institutional and managerial
improvements (Frederickson, 1999) with particular focus on implementation and achievement of results
not only on policy and planning but on the involvement of some stakeholders in both planning and
implementation (Clark, 1996)). The study is current and fits into the needs of those engaged in research in
contemporary governance practices.

2
3. RESEARCH FRAMEWORK AND METHODOLOGY

Research Framework

3.1 The study was carried out in project phases following the operational framework in Figure 1.

COMPONENT A COMPONENT B
INSTITUTIONAL MAPPING INSTITUTIONAL ANALYSIS

Phase 1 Phase 2 Phase 3 Phase 4

Inventory of Interpretation Selection LGU Analysis

Organizations/ of Data of LGUs • LFPM process
Institutions • Roles and • Selection • Involvement and
• International relevance of criteria participation
financial organizations • Selection • Authorization
institutions • Difficulties and process procedures
• Non- constraints • Leadership patterns
government • Facilitating • Practices
• Academic factors • Partnership potential
institutions • Gaps and
• Government overlaps

Figure 1. Operational Framework for the Institutional Mapping of

Support Systems to LFPM and Institutional Analysis

3.2 Preparatory Phase: This phase covered a co-development of expectations with EPRA Project.
The key tasks in this phase included the development of needs and expectations and an agreement on
project objectives, measurable expectations, methodology, work plan and timetable.

3.3 Phase 1: This phase involved identifying and contacting the various public and private entities
working with LGUs in LFPM. The institutions were sampled from a list initially prepared by the
researchers except for a complete enumeration of cities and provincial LGUs. The institutions contacted
included the following:

Number of Organizations Response

Surveyed Responded Rate
GROUP 1
International Finance Institutions (IFI) 5 5 100
Non-government Organizations (NGOs) 220 20 9.09
Academic Institutions 35 17 48.57

3
 Sub-total 260 42 16.15

GROUP 2
National Government Agencies (NGAs) 19 18 94.74
Government Owned and Controlled Corp.
(GOCCs) 3 3 100.00
Sub-total 22 21 95.45

GROUP 3
Provinces 79 14 17.72
Cities 112 34 30.36
Municipalities 142 12 8.45
Sub-total 333 62 18.02

GRAND TOTAL 615 123 20.00

3.4 An inventory of organizations and institutions that provided assistance in LFPM was then
produced. Majority of data on the international finance institutions’ (IFIs) assistance were gathered
through secondary information as these assistance fell under country assistance programs.

3.5 The 11-page checklist type of survey focused on two areas: (1) purely financial planning and
management, and (2) financial planning and management-related initiatives. The survey questionnaires
were sent to key informants via postage and electronic mail. The response rate was 20 percent.

3.6 The major reason given by the LGUs for not returning the survey questionnaires was that they did
not have any assistance programs for other LGUs except for those in their respective barangays. The
NGOs, on the other hand, whose programs/projects were sector-specific, did not have direct LFPM
assistance, but the assistance naturally followed in project implementation. Majority of the sent emails
bounced back, indicating that NGO directories were not updated. Thus, the survey was followed-up
through telephone calls or by physically going to each of the concerned offices.

3.7 The key informants for Group 1 were mostly directors (32.43%) and executive directors
(13.52%). Group 2 composed mostly of auditors (45%) and directors (22.7%). Group 3 composed of
local financial and administration teams, mostly planning and development officers (45.0%).

3.8 Phase 2. In this phase, results of the study were interpreted and analyzed to extract meanings that
would be helpful to EPRA in developing its policy reform agenda and strategic approaches. The role(s)
of the different organizations and institutions in the development of financial planning and management
in LGUs were identified. The strength of support extended by organizations and institutions to LGUs in
terms of relevance, importance, and impact were assessed. Problems faced by the organizations and
institutions in terms of difficulties and constraints were appraised. Facilitating factors of the organizations
and institutions in the provision of support were identified. Gaps and overlaps in the initiatives, efforts,
and assistance to LFPM were also determined. LFPM lessons for the future of local governments were
likewise drawn.

3.9 Phase 3 and Phase 4. These phases involved the (a) development of a set of criteria to select
LGUs for case studies, and (b) analysis of LGUs with innovative and locally-harnessed practices. The

4
theme of all the case studies was “Inter-LGU Collaboration in Local Financial Planning and
Management.”

3.10 There were three variations of the theme:

Case 1: A city and three municipalities (in Luzon)

Case 2: A province and three municipalities (in the Visayas-Mindanao areas); and

Case 3: A metropolitan city and barangays

3.11 The cases focused on the practices of the LGUs in collaborating with other LGUs in LFPM. In
addition, the case studies involved an in-depth institutional analysis of the selected LGUs based on the
following:

a. Extent of involvement and participation of the Local Finance Committee and Local
Development Council in the planning and budget management processes;

b. Authorization procedures and leadership patterns (factors that determined the ascent to
and maintenance of the position of power and the leaders’ relationship with their
followers, network of influence, and access to political power above the barangay level)
in the planning process;

c. Evaluation of factors which underlie practices in LFPM and in budget formulation and
execution, such as the information rules, information routines, incentive structures, and
level of transparency and accountability; and

d. Openness or willingness of selected LGUs to partner with the Ateneo-EPRA Project.

Process Flow of Discussion

3.12 This report has four major parts – types and nature of assistance; institutional arrangements;
facilitating factors and constraints; and policy directions for the EPRA Project (Table 1). The study
proceeded with the general problem question: “What is the status of assistance provided by institutions to
the development of LFPM in the Philippines?” In so doing, the types of assistance provided to LGUs and
their concomitant nature were inventoried or mapped. The report revolved around the seven identified
areas of LFPM, categorized as (a) purely financial planning and management areas, and (b) financial
planning and management-related areas. These form Part I of the report.

3.13 Part II discusses the institutional arrangements including the identification of methods of tapping
the LGU beneficiaries, working arrangements of institutions with LGUs including the terms and
conditions of support provided, provision of LFPM support as a mandate, and interest for partnership with
the EPRA Project. The benefits derived from the assistance as well as the satisfaction of work
relationships are also documented.

3.14 Part III presents the facilitating factors like objectives of support, political feasibility, staff
behavior, financial accountability and transparency, and the approaches used in the assistance. The
constraints in LFPM assistance are described in terms of common areas of confusion and difficulties.
Also discussed are the major gaps and overlaps in LFPM assistance.

5
3.15 Part IV discusses the policy options for EPRA and the identification of proposed interventions in
addressing the gaps identified in Part III. A set of action arenas was developed for EPRA and its MST
together with the summary of findings.

Table 1. Process Flow of Discussion of LFPM Assistance

Part I. Types and Nature of Assistance Part II. Institutional Arrangements

9 List all types of assistance provided to
the LGUs.
9 Describe the nature of assistance.
9 Identify the areas of LFPM where
assistance is provided.
Part III. Facilitating Factors and
Constraints
9 Determine the facilitating factors in
LFPM assistance.
9 Identify the difficulties in LFPM
assistance.
9 Identify major gaps and overlaps in
LFPM.
9 Identify the methods of tapping LGU
beneficiaries
9 Identify the institutional arrangements in
LFPM assistance.
9 Determine whether provision of support
is an organizational mandate.
9 Assess the interest for partnership with
EPRA.
9 Identify the benefits derived from LFPM
assistance.
Part IV. Policy Directions for EPRA
9 Suggest policy options for the EPRA’s
MST.

4. TYPES AND NATURE OF LFPM ASSISTANCE

4.1 This section reports the assistance of various institutions to the LGUs. The institutions were
classified into groups as follows:

• Group 1: IFIs, NGOs, and academic institutions

• Group 2: National government agencies (NGAs) and government owned and controlled
corporations (GOCCs)

• Group 3: LGUs (provinces, cities, and municipalities)

4.2 Altogether, the study covered around 123 institutions broken down into Group 1 (42), Group 2
(21), and Group 3 (62). Making an inventory of institutions directly engaged with LGUs on LFPM
proved to be difficult because majority of these institutions were involved with LGUs on sector-specific
interventions. These interventions were project or program-based in traditional development areas of
health, education, agriculture and rural development, environment, and others. LFPM was a consequential
management function of these projects/programs.

4.3 The type of LFPM assistance was three-fold: financial assistance, technical assistance, and policy
assistance. Financial assistance refers to direct financial assistance and credit financing either through

6
loans or grants. Technical assistance refers to the deployment of experts, capacity building, and non-cash
support. Policy assistance refers to assistance in developing the regulatory framework and policy
directions in LFPM. This definition of LFPM assistance builds upon the initial description of financial
management assistance to LGUs as provided by the Local Government Support Program of the Canadian
International Development Authority (LGSP-CIDA) where assistance falls only into two categories:
financial assistance and technical assistance (LGSP, 2004).

4.4 The nature of assistance was classified as program/project assistance, financial assistance,
equipment/facility donation, awards system, policy support, networking/linkaging, planning support,
capacity building support, and research studies/surveys. Thus, LFPM covers more than the commonly
conceived notion or perception of solely financial assistance.

4.5 To better map the assistance being provided by institutions to LGUs, the study considered the
following as the “general areas of LFPM”: (a) purely financial planning and management areas; (i)
revenue generation, (ii) accounting, and (iii) budgeting; and (b) financial planning and management-
related areas: (i) internal auditing, (ii) local economic development, (iii) local development planning, and
(iv) procurement process. Table 2 provides the types, description, and nature of assistance and the areas
of LFPM.

Table 2. Types, Description, Areas of LFPM, and Nature of Assistance

Types Description Nature of Assistance Areas of LFPM

Financial • Direct financial • Program/project • Revenue generation

Assistance assistance • Financial assistance • Accounting
• Credit financing • Equipment/facility • Budgeting
(loans) donation • Internal auditing
• Awards system • Local economic
• Policy support development
Technical • Deployment of experts • Networking/ linkaging • Local development
Assistance • Capacity building • Planning support planning
• Non-cash support (e.g., • Capacity building • Procurement process
infrastructure) support
• Accessing grants and • Research
financial assistance studies/surveys

Policy • Regulatory framework

Assistance • Policy directions

4.6 The assistance provided by the three groups of institutions can be summarized as financial
assistance, technical assistance, and policy assistance. IFIs provide a complete package of all three types
of assistance. Their framework of assistance can be classified as donor assistance and this assistance can
be considered as sector-specific interventions under infrastructure development, agriculture and rural
development, basic social services, environmental management, good governance, and regional
development. Financial assistance is delivered through loans and borrowings by projects. Generally,
financial assistance has a technical assistance component.

7
4.7 There are very specific assistance initiatives of IFIs under LFPM like (a) the World Bank’s
Islands of Good Governance, Local Government Finance and Development Project (LOGOFIND), and
Re-Engineering Program under the Department of Budget and Management (DBM); (b) the Asian
Development Bank’s (ADB) technical assistance (TA) on strengthening local government finance and
budgeting; and (c) the Siquijor Integrated Rural Development Program (SIRMAP) of the German
Development Cooperation. SIRMAP emphasizes local economic development and administrative
simplification of procedures/ operations as routes for both community development and management
capability building. SIRMAP focuses on harnessing interlocal cooperation of doing things together to
maximize local capacities and resources.

4.8 The United States Agency for International Development (USAID) assists Philippine institutions
in undertaking programs to improve efficiency, transparency and accountability. USAID’s programs seek
to achieve improved performance of selected government institutions. Through its Livelihood
Enhancement and Peace (LEAP) Program (and LEAP's predecessor programs), USAID has assisted, or is
assisting, some 21,000 former Moro National Liberation Front (MNLF) combatants to become
commercial producers of corn, rice or seaweed. It has also provided consultants for the BOT to enhance
LGUs alternative sourcing of funds. ADB, however, has significantly targeted local financial
management as its intervention focus in many of its technical assistance.

4.9 There seems to be a consensus among donors to promote equitable sharing of the benefits of
economic growth, reduce poverty at a faster pace, and enhance the self-reliance and service delivery
capacity of local governments. Direct LFPM assistance falls under the good governance framework and
becomes secondary to other frameworks.

4.10 In the NGOs’ group, results showed that barely half of the NGO respondents actively extended
their operations to assist LGUs in LFPM for two reasons. First, specific programs and projects of NGOs
were found to have only circumstantial level of assistance to LGUs as one of the former’s beneficiaries.
Second, the most frequent NGO/CBO tasks have been community mobilization and capacity building
outside LFPM. In other words, LGUs are just one of the target beneficiaries of NGOs. Further, the
services of NGOs are mostly outside of LFPM.

4.11 It is generally believed, however, that the increased involvement of NGOs in capacity building
has increased the LGU’s demands upon them for their capacity and expertise development. Most
respondents cited capacity building, more than any other kind of assistance, as the form of support given
by the NGOs to LGUs.

4.12 NGOs’ support to the LGUs was seen as an indirect result of their day-to-day operations. Only
two of the NGOs inventoried – the Julio and Florentina Ledesma Foundation, Inc. (JFLFI) and the Cebu
City Resource Management and Development Center (CREMDEC) – had specific programs to increase
the LGUs’ revenue generation through real property taxation and business permits and licenses. Most of
the respondents that supported revenue generation, such as the Center for Community Transformation, the
Andres Soriano Foundation, and the National Confederation of Cooperatives (NATCCO), were involved
in providing policy support, strategic planning, and capacity building - common assistance provided by
NGOs to the LGUs. Institutions such as the Worldwide Wildlife Foundation (WWF) Philippines have
supported LGUs in revenue generation through the User Fee System program that it has been
implementing in dive sites across the country.

4.13 Since these NGOs’ projects aimed to promote sustainable economic and rural growth through
poverty reduction and equity programs, the NGOs would consequently be directly involved with the local

8
governments. CREMDEC was involved in both financial accounting and reporting, in assisting with the
establishment of the new government accounting system through awards systems, and in providing
technical assistance and capacity building programs. Its operation was highly tied with Cebu City’s local
development initiatives, which included accounting and transparency programs.

4.14 Since the inception of the Gawad Galing Pook Innovations and Excellence in Local Governance
Awards, a total of 1,592 applications have accepted from the LGUs (Table 3). Of these, 171 (10.7%)
have been awarded as models of exemplary and innovative local governance practices in the Philippines.
It is noteworthy that of the 128 entries in local administration and management, only 15 got awards, eight
of which (or 4.6% of the total awardees) were finance-related. Also, local administration and
management (where LFPM belongs as a category) was ranked only 7th in exemplary practices.

4.15 Among the LGUs awarded in finance-related initiatives were (a) Cebu City’s tax computerization
project (1994); (b) Binangonan, Rizal’s increased tax collection (1995); (c) Tagaytay City’s financial
engineering (1998); (d) San Fernando City, Pampanga’s tax mapping to break financial barriers (2000);
(e) Muntinlupa City’s real property tax computerization and administration project (2000); (f) Nueva
Vizcaya’s reformed the real property tax system (2002); (g) Cabuyao City’s streamlined business permit
process through the one-stop-shop (2002); and (h) Quezon City’s improved revenue collection and
spending (2003).

4.16 LFPM is also classified under the enterprise and livelihood development award. Seventeen
(6.4%) of 266 LGU applicants have been given this award. Despite the recognition given to the two
LFPM areas – financial management and enterprise/livelihood development – however, these have not
created as much impact as initiatives in environmental protection and welfare services. This reflects that
priorities given by LGUs to LFPM initiatives have not merited recognition by award giving bodies or
worse, may not have created enough impact to merit recognition. Nonetheless, this shows that LFPM is a
rich area for engaging the assistance of LGUs.

Table 3. Gawad Galing Pook Applicants and Awardees by Categories

Program Categories Number of Number of Rank
Applicants Awardees
Environmental Protection 322 42 1
Enterprise and Livelihood Development 266 17 4
Health and Nutrition 240 16 5
Welfare Services 174 21 2
Agriculture 155 18 3
Local Administration and Management 128 15 7
Service Delivery 89
Education 78 8 9
Protective Services 75 16 6
Housing program 65
Integrated Area Development 10 8
Infrastructure Services 8 10
Total 1592 171
Source: Galing Pook Foundation, 2006

4.17 The LGUs’ need for LFPM assistance is an area which NGOs are indirectly supporting as part of
their local development efforts. Due to the importance given to NGOs, their efforts in all activities that

9
they are spearheading must be coordinated. The ADB, for instance, has recognized the capabilities of
NGOs in their development programs. In a 1999 study1, ADB stated that since 1990, 25 percent of all
ADB projects have had some form of NGO/community based organizations’ (CBO) involvement, and in
1998, more than US$2 billion (49% of all ADB projects) incorporated NGO/CBO activities.

4.18 The academe’s main contribution in LFPM is technical assistance, especially in capacity building
and deployment of experts. Notable is the emergence of curricular programs in governance for LGUs in
various schools. Among these are the Ateneo de Manila University through the Ateneo School of
Government; the University of the Philippines (UP) Diliman though the National College of Public
Administration and Governance (NCPAG); the UP Los Baños through the Institute of Development
Management and Governance (IDMG); the UP Open University (UPOU); the De La Salle University
through the Institute of Governance; and the Development Academy of the Philippines (DAP).

4.19 The Ateneo School of Government offers the Master in Public Management, major in Local
Governance, now a customized off-campus program to specific LGUs. The pilot program of this type
started in 2005 in the City of Calapan where local officials and employees enjoyed a scholarship grant of
the city government. The NCPAG of UP Diliman has a long-standing executive education program for
Local Chief Executives. The NCPAG and UPOU have a collaborative offering - the Master in Public
Management via distance education. The IDMG of the College of Public Affairs of UP Los Baños offers
a Masters degree in Public Affairs, major in Local Governance and Development. The degree’s enrollees
alone comprise 10 percent of the total graduate students in UP Los Baños. This program offers fiscal
management in LGUs as a major course. Meanwhile, assistance to LGUs comes in the form of on-call
individual deployment of faculty experts and occasional institutional researches with academic partners
here and abroad. The Certificate in Barangay Administration Program of the UP Open University also
emanated from IDMG. The DAP has a Master in Public Management (MPM), major in Local
Governance Management, with Local Fiscal Management and Resource Mobilization as a major course.

4.20 Local governance programs have likewise emerged in other universities in the provinces. The
University of San Agustin in Iloilo City has a Resource Center for Public Management and Governance
providing support to LGUs. The Resource Center was established specifically to support the university’s
extension work, thus, in effect, institutionalizing the latter’s efforts to build the LGUs’ capability. The
Mindanao Center for Local Governance of the Mindanao State University assists LGUs, mostly
barangays of Lanao Sur and LGSP partner LGUs, on capacity building. Specifically, the center conducts
local development planning seminars and researches on business permits and licenses. However, majority
of LFPM assistance outside Metro Manila can be classified as seminars and trainings only.

4.21 The NGAs exercise their regulatory mandates and extend their activities to LGUs. The Bureau of
Local Government Finance (BLGF) of the Department of Finance (DOF), the Department of Interior and
Local Government (DILG), the Commission on Audit (COA), and the National Economic and
Development Authority (NEDA) lead the government agencies in providing support to LFPM. The most
common forms of BLGF assistance are in real property taxation (RPT) especially in tax mapping,
revisions of the Real Property Tax Administration (RPTA), databasing of RPTs, and information support.

4.22 The DILG has the Local Government Academy (LGA) as its primary training arm. The LGA
was created as a national training institution that would coordinate, synchronize, rationalize, and deliver
training programs for local governments. One category in LGA’s training program is Fiscal Management,
which includes two major courses: (a) Professionalizing Local Fiscal Managers: A Key to Greater Local
Fiscal Autonomy, and (b) Seminar/Workshop on Resource Mobilization and Updating the Local Revenue
Code. In practice, there are other departments in the DILG that cater to the training of LGUs. However,

10
the LGA has one of the most expansive training programs in LFPM. The COA likewise has its own
training unit that caters to both its own pool of state auditors and to officials and employees of LGUs. It
also provides customized training programs, particularly on updates in the New Government Accounting
System (NGAS) to certain LGUs or clusters of LGUs.

4.23 Also worth noting is the monitoring and evaluation nature of assistance provided by the NGAs.
This study, however, reflected a ‘diminished role’ of NGAs as monitors of the decentralized modes of
LGU operations.

4.24 Key assistance can be understood by examining the mandates of each government institution.
The Land Bank of the Philippines (LBP), for example, provides a wide range of institutional credit as part
of its LGU institutional strengthening program. Its lending program to LGUs includes financing for local
infrastructure and other socio-economic development projects in accordance with approved local
development plans and investments programs. The bank requires the LGU a counterpart of 25 percent of
total project cost. The loans are payable in five years. Similarly, the LBP’s Water District Development
Project provides participant LGUs investments on sewerage and sanitation based on the local residents’
wishes and willingness to pay. The bank cost-shares 90 percent while the LGUs provide the remaining 10
percent.

4.25 There are institutional arrangements in co-managing the loans. For example, the LGU appoints a
point person to coordinate with the LBP Project Management Office. The LBP also has a Support Credit
Program for low-cost housing, health, water systems, flood control and sanitation, and forestry and waste
disposal projects with a maximum loanable amount of Php3.0 million. The program is supported by the
Japan Bank for International Cooperation (JBIC). Another assistance program is the LBP-LGU
Cooperative Strengthening Partnership program, which aims to strengthen capabilities in operations
management and sustainability of cooperatives in the LGUs’ locale. This program is a technical
assistance program of the LBP funded by LGUs with the LBP providing the necessary information,
education and communication (IEC) materials. It is generally recognized that credit financing from
government financial institutions (GFIs) is the most popular form of external financing among LGUs.

4.26 To date, the most active GFI in LGU lending is the LBP, with reportedly around Php18 billion in
LGU loan portfolio as of yearend of 2001. Privatized former GFI Philippine National Bank (PNB) has
released an aggregate of Php6.828 billion to LGUs from 1996 to 2001, while the Development Bank of
the Philippines (DBP) had an outstanding LGU portfolio of Php4.659 billion as of the end of February
2002. The Philippine Veterans Bank (PVB), a new player in the LGU market, has so far lent Php677
million to LGUs from 1999 to 2001.

4.27 GFIs were limited to providing direct financial assistance. It was the BLGF that provided the
policy and regulatory directions for financial management in local governments. The BLGF played a
catalytic role in the effective and sustainable management of fiscal and financial resources of LGUs,
transforming them into self-reliant communities. The major services of the BLGF were the following:

• Evaluating and processing of appointment and designation of local treasurers; acting on

administrative cases filed against the treasurers;

• Providing technical assistance in the review and updating of local revenue codes;

• Rendering opinions and rulings, and issuing circulars and guidelines on local assessment and
treasury operations;

11
 • Providing financial assistance in the form of soft loan to LGUs for the conduct of (a) general
revision, (b) RPTA project, and (c) business tax enhancement program;

• Conducting seminar-workshop on resource mobilization; and

• Issuing certificates on the borrowing and debt service capacity of LGUs.

4.28 The increasing demands on the LGUs coupled with bureaucratic challenges have been forcing the
BLGF to effectively function based on its mandates. It was also noted that LGUs were not
knowledgeable on how to avail of the various service facilities of the BLGF. In fact, a major technical
assistance of ADB is the strengthening of the local financial planning and budgeting among LGUs. Such
assistance also addresses the functioning of BLGF and helps in developing its capacities beyond being
just a processor of appointments for local treasurers as perceived by the LGUs.

4.29 Another model currently being used is the fund conduit and project management model through
the Municipal Development Fund Office (MDFO). Here, the MDFO serves as a fund conduit for
multilateral loans such as the Community-based Resource Management Program (CBRMP) and the
LOGOFIND project of the World Bank. The facility, called LOGOFIND, has funding support from the
World Bank and targets mainly the lower income class LGUs (3rd to 6th income classes). Between 1995
and 2001, the MDFO released Php1.959 billion in loans to LGUs. As to government support, national
government allotments to LGUs by type of funds were the following: Municipal Development Fund,
Countrywide Industrialization Fund, Local Government Empowerment Fund, Local Officials Insurance
Premium Fund, UF-Municipal Development Fund, UF-Support for Foreign-Assisted Projects, Special
Financial Assistance to LGUs, Foreign-Assisted Projects Support Fund, and Poverty Alleviation Fund.
The total amount allocated to these funds varies from year to year depending on the General
Appropriations Act. The MDFO is being considered as a GOCC in the future.

4.30 The decentralization of fiscal responsibilities also gave rise to intergovernmental fiscal transfers.
The LGUs receive financial assistance from the national government in the form of revenue sharing
through the Internal Revenue Allotment (IRA). Tobacco-producing LGUs share from the tobacco excise
taxes as provided for in Republic Act 7171 and Memorandum Order No. 61. National governments also
provide grant mechanisms like the Local Empowerment Fund, the DepEd School Building program, the
President’s Bridge program, the President’s Social Assistance Fund and the Philippine Development
Assistance Fund, commonly referred to as pork barrel. These grants are usually provided to assist LGUs
in their special expenditures during calamities and emergencies and to mobilize LGUs towards national
government priorities. An example is the assistance provided by the National Disaster Coordinating
Council (NDCC) under the Department of National Defense (DND) during calamities and emergencies.
These grants are administered by various national government agencies.

4.31 National budget transfers to LGUs consumed 22.5 percent of the national government’s annual
revenue collections. At the same time, only 32.6 percent of LGU expenditures were financed by local
revenues (Capuno, 2002). For a large percentage of LGUs, the share of own revenues was considerably
lower. This growing gap between LGU expenditures and generated revenues is being filled by expanding
transfers from the national budget through the IRA. Support in revenue generation was dominant in real
property taxation and business permits and licenses and obscure in build-operate-transfer (BOT) schemes
and municipal bond floatation. This clearly indicates that organizations and institutions provide support
in the traditional areas of revenue sourcing. Non-traditional areas are yet to be explored by those
providing assistance to LGUs.

12
4.32 Alternative revenue generation sourcing like municipal bonds and BOT schemes are relegated
only to project development and policy support. A noticeable absence of assistance in this area from the
academe is noted. The long history of centralization is still seen in the traditional modes of revenue
sourcing. The results confirm previous studies that local development projects are largely financed
through four mechanisms: (a) directly by government/commercial financing institutions; (b) through the
line departments using the LGUs’ own budget/shares (IRA); (c) borrowings from international financing
institutions by the national government; and (d) co-financing by LGUs and NGOs.

4.33 The LGUs’ LFPM assistance to other LGUs was in both policy and technical assistance. Policy
assistance refers to building up a regulatory framework (e.g., tax collection policies and revenue codes).
Direct technical assistance through grants and donations is provided by higher levels of LGUs to their
own barangays. Most LFPM assistance to barangays was in information support on revenue
enhancement, which the barangays were currently engaged in. Activities for LFPM assistance provided
by LGUs to other LGUs included: (a) enactment of municipal/city/barangay ordinances pertaining to
local taxation and revenue code; (b) assessment of real property and analysis of revenue collection; (c)
scholarship grants; (d) financial grants and other donations to LGUs; (e) seminar and information support
on revenue enhancement; (f) active participation in leagues; and (g) establishment of one-stop shop
processing centers and their replicates in different areas.

4.34 Inter-LGU LFPM assistance was noted to be high among the LGUs as part of the performance of
their mandate for municipality/city to barangay operation. Other forms of assistance were capacity-
building through networking and linkaging using study tours and exchanges. Twenty five percent (25%)
of the LGUs provided financial assistance to other LGUs for study tours. Further, trainings were
conducted to facilitate local policy directions. Majority of the assistance was in the form of “big brother”
type where richer LGUs assisted other LGUs especially in times of emergency. For example, the Cebu
provincial government donated Php2 million to the Oriental Mindoro provincial government to assist
flood victims in late 2005 (The Governor Newsletter, 2006). Another was a city-province model where
Quezon City donated Php5.3 million to the province of Southern Leyte for victims of a landslide
(Philippine Star, 2006).

4.35 Table 4 provides a summary of the sources of LGU revenues. Most of the LGUs relied on
national government grants/shares with alternative revenue sources (commercial credit, bonds, BOT, etc.)
being maximized only by higher income LGUs. Alternative sourcing of revenue is a growth area in
LFPM.

4.36 Results of this survey showed a higher response rate from respondents of cities at 30.36 percent
(34 of 112 cities) than from municipalities at 8.45 percent (12 of 142). This can be attributed to the
revenue capacity or stronger position of cities – income-wise - to assist in LFPM compared to
municipalities. Inter-local cooperation and assistance were also emphasized in cities. These results
confirm the recent documentation and study of best practices by the DOF which concluded that:

“Fourteen years hence, the situation is both inspiring and disturbing. It is inspiring because
a number of LGUs have exercised the initiatives in revenue generation using their new
taxing power which funded vital development projects that have brought progress to their
provinces and municipalities. What is disturbing is that only a small minority of local
governments has taken advantage of the new financing options made available to them.
Specifically, of 1,696 LGUs (79 provinces, 114 cities and 1,503 municipalities), less than
10% exercised their new financing mandate. The provincial and the city governments appear

13
 to be more active in pursuing joint venture agreements and bond issuance compared to
municipalities.” (Amatong, 2005)

Table 4. Sources of LGU Revenues

LGUs NG NG BOT Bond Donor Commer- Co-
and Grants/ Flota- Assist- cial Credit financed
GFI Shares Tion ance (TA) by LGU
Credit and NGO
Majority of • •
LGUs
High Income • • • •
LGUs
Middle • •
Income LGUs
Lower Income • • •
LGUs

Source: Modification of Tan, Roberto, 2004. Global Trends in Financing Sub-National Government and
Para-Statal Entities: The Philippine Experience

4.37 In summary, the technical and policy assistance were the two most dominant types of LFPM
assistance by institutions. Appendix Table 2 shows that 30.73 percent of the respondent organizations
were engaged in capacity building while 18.21 percent provided policy support. The other nature of
support included (a) planning support (17.24%); (b) networking and linkaging (15.50%); (c)
program/project type (13.88%); (d) research, studies, and surveys (12.03%); (e) financial assistance
(10.08%); (g) equipment or facility donation (4.93%); and (h) award system (3.69%).

4.38 Capability building was performed primarily by international funding agencies, NGOs, and
academic institutions with varying roles in the provision of support. International funding agencies
usually provided funds for capacity building while some NGOs and academic institutions packaged and
conducted training programs and study missions. On the other hand, the NGAs provided resource
persons on various subject matters as part also of their advocacy to encourage adherence to certain
national rules and regulations. Among LGUs, capability building support mostly followed a vertical
flow, that is, a higher level of local government assisted a lower level local government. This was best
exemplified by provinces helping the municipalities, and the cities and municipalities assisting the
barangays. Capability building included training and seminars, study missions, and exchange or twinning
arrangements.

4.39 Policy support involved (a) provision of policy agenda and direction, (b) preparation of
guidelines, (c) clarification of issues, and (d) initiatives to entice implementation of policies. This was
done primarily through the issuance of orders, memoranda, and circulars. Provision of policy agenda and
direction was distinct among international funding agencies. Meanwhile, the provision of guidelines,
clarification of issues, and monitoring of policy implementation were done by the national government
agencies, particularly the DOF through the BLGF, Department of Budget and Management (DBM),
DILG, and the COA.

4.40 For the areas of LFPM, Appendix Table 2 shows that the organizations provided assistance
primarily in local development planning (23.49%), budgeting (15.81%), local economic development

14
(15.54%), and accounting (13.85%). They assisted least in (a) revenue generation (10.93%); and (b)
internal auditing (9.94%). The details of assistance in each area of LFPM are discussed in the succeeding
parts of this report.

4.41 Table 5 shows the types and nature of assistance by groups of providers. The three groups
generally provided three types of assistance (financial, technical, and policy), except for the
NGOs and academic institutions (which belonged to Group 1) which provided only technical
assistance. Further, each group of organizations provided a distinctive nature of assistance.

Table 5. Types and Nature of Assistance by Groups of Providers

Groups Types of Assistance Nature of Assistance
Group 1 Financial Assistance Program/Project Loans
International Financial Technical Assistance Policy-based Loans
Institutions Policy Assistance Technical Assistance Grants/Loans
(Multilateral/Bilateral) Infrastructure Support
Technical Cooperation Program
Commodity Assistance
Emergencies’ Assistance
Advisory Services
Development Studies
Trainings/scholarships
Support to civil society organizations
(CSOs)
NGOs Technical Assistance Training/Capacity Building
Dispatch of Experts
Community Organization and
Mobilization
Sector-specific Development
Interventions
Academic Institutions Technical Assistance Curricular Programs in Local Governance
Short-term Courses
Policy Support
Deployment of Experts
Project Feasibility Studies
Group 2 Financial Assistance Lending Program to LGUs
GOCC (LBP, DBP, PVB) Technical Assistance LGU Credit Support
Policy Assistance Technology Promotions
LGU-Cooperative Strengthening
Partnership
National Government Internal Revenue Allotment
(Revenue Shares) Shares in National Wealth
Tobacco Excise Tax
National Government Calamity Fund
(Grants) President’s Bridge Program
DepEd School Building Program
Local Government Empowerment Fund
Group 3 Financial Assistance Interlocal Cooperation
LGUs Technical Assistance Calamity Assistance
Policy Assistance

5. AREAS OF LFPM

15
Revenue Generation

5.1 This part details the assistance given to LGUs by the different groups of organizations in four
sub-areas of revenue generation: real property taxation, business permits and licenses, bond floatation,
and BOT scheme.

5.2 Real Property Taxation. For the three groups of respondents, assistance to LGUs in RPT was
primarily in the form of capacity building and policy support. International funding agencies and some
NGOs provided both financial and technical assistance necessary to train officials, employees, and
constituents of local governments. These were usually in the aspects of RPT assessment and valuation
and in the computerization of the RPT system. Educational institutions served as the training arms of
international funding agencies and NGOs; at the same time, they offered their own developed training
programs. Some NGOs also provided training programs.

5.3 Among the national government agencies that provided training programs in RPT, the most
prominent were the DOF’s BLGF and the DILG. Their support ranged from the offering and conduct of
their own developed training programs to the provision of resource persons, and the contracting out of
trainings to other private institutions like universities and NGOs with track records in training. In the
policy aspect of RPT, the BLGF provided primary support. It issued Local Finance Circulars, RPT
opinions and rulings, and assessment regulations. The DBM issued local budget circulars covering a
wide range of subjects in LFPM, including RPT.

5.4 The BLGF has the RPTA Project, a countrywide project with funding assistance from the World
Bank. The RPTA Project has the following objectives: (a) to support efforts on LGU resource
mobilization through the improvement of RPT collection; (b) to enhance administration of foreign-
assisted projects; and (c) to develop a model in tax administration for replication in other LGUs. The five
components of the RPTA Project are as follows: (a) tax mapping—identifying real property units,
establishing property boundaries, determining actual use of properties, and discovering undeclared
properties; (b) records conversion and management—conversion of tax mapping information to
individual property records with the necessary classification, and appraisal and assessment of real
properties. Also included are the preparation of collective assessment rolls as well as the installation and
maintenance of a basic system in records management in the local assessment office; (c) tax collection
enforcement—review and revision of existing procedures in collection recording, accounting, and
disposition of RPTs, both for collectible and delinquent accounts; (d) data computerization—
establishment and operationalization of a computer-assisted database for RPTA, including the
familiarization/training of key personnel, encoding and validation of data, acquisition and installation of
standard RPTA system, generation of reports, and preparation of complementary manual of procedures;
and (e) geographic information system (GIS)—digitization of all tax maps with the inclusion of necessary
information on every piece of land at the Treasurer’s and Assessor’s Offices and the possibility of
linkages with other offices. This system is being used as an aid for ocular inspection, verification of the
location of properties by owners, generation of vicinity maps, identification of overlapping in properties,
and identification of duplicate assessment of real properties.

5.5 Business Permits and Licenses. The support to LGUs in business permits and licenses (BPL)
was also in capacity building and policy. The training on BPL was on the revision or updating of the local
revenue tax code that was focused primarily on taxing business establishments. Capacity building on
BPL also involved system design or improvement in procedures, processing time, and documentary
requirements in applying for local business licenses. Establishment of a one-stop shop had also been a

16
primary subject of discussions in local study missions where a group of local officials observe the
practices of LGUs which have established one-stop shops.

5.6 One entity that focused on the BPL system was The Asia Foundation. The foundation has helped
enhance the BPL system of several cities in Mindanao. It also worked on “Making Cities Work” to
enhance the investment climate and business-enabling environment of LGUs. The BLGF implements the
Business Tax Enhancement Program (BETP) aimed to provide medium-term financing and technical
support to LGUs for the implementation of programs and activities that will accelerate the growth of local
revenue from business taxes. The primordial objective of the BETP is to promote local autonomy and
self-reliance by (a) increasing locally sourced revenues and reducing dependency on IRA; (b) accelerating
growth of local business tax collections; (c) training of LGUs’ qualified personnel in examining books of
accounts of businesses to determine gross receipts; (d) introduction of innovative practices to enlist the
cooperation of businesses taxpayers; (e) training of LGUs on the “presumptive income level” in
estimating business gross receipts and on the referral to income tax returns for the same purpose; and (f)
improving overall LGU management systems in business tax collections.

5.7 The BETP has four components: (a) business tax mapping—identifying the business,
establishing business location, determining business nature or type, and discovering undeclared business;
(b) records conversion and management—conversion of business mapping information to individual
business records, classification, estimation of capitalization or value, preparation of business records, and
installation and maintenance of basic management system in business records in the Local Business Tax
Office; (c) tax collection and enforcement—review and revision of existing procedures on the collection,
recording, accounting, and disposition of business taxes; and (d) data computerization—establishment
and operationalization of a computer-assisted database, including the familiarization or training of key
personnel, encoding and validation of data, acquisition and installation of standard system, generation of
reports, and preparation of complementary manual of procedures.

5.8 Bond Floatation. The LGC of 1991 empowered the LGUs to engage in new modes of financing
other than the traditional real property and business taxation. These new modes, which used to be
employed by NGAs and GOCCs, included issuance of bonds, establishment and operation of local
enterprises, and joint venture arrangements like the BOT scheme. The bond floatation and the BOT were
the two popular and common alternatives for sourcing funds to finance projects that the LGUs were
engaged in. Caloocan City had the highest recorded bond floated at Php 620 million.

5.9 The DOF (2005) reported that less than 10 percent of the 1,696 LGUs in the Philippines have
exercised their new financing mandate (Table 6). Only 21 have issued bonds; 17 have BOT projects that
are either completed, under concession, awarded, or in the process of bidding; and 164 have availed of
loan packages. These are clear indications that support in bond floatation was primarily in capacity
building and research. In addition, the bond floatation of LGUs included guarantee as provided by three
entities: the Housing Guarantee Corporation, LGU Guarantee Corporation (LGUCC), and Philippine
Veterans Bank (PVB).

Table 6 LGUs with Bond Issuance

Bond Name Area Term Project Amount
(Years) (Million Pesos)
1 Victorias Mabuhay Bonds Negros Occidental 2 8
2 Legazpi Suerte Bonds Albay 3 26
3 Claveria Housing Bonds Misamis Oriental 3 20

17
 4 Puerto Princesa Housing Bonds Palawan 3 20
5 Sto. Domingo Housing Bonds Nueva Ecija NA 10
6 Urdaneta City Municipal Bonds Pangasinan 5 25
7 Boracay-Aklan Provincial Bonds Aklan 7 40
8 Puerto Princesa Green Bonds Palawan 7 320
9 Caloocan Katipunan Bonds Caloocan City 7 620
10 Tagaytay City Tourism Bonds Tagaytay City 7 220
11 Iloilo City Bonds Iloilo City 3 130
12 Daraga Municipal Bonds Albay 7 75
13 Bayambang Aliguas Bonds Pangasinan 7 42
14 Leyte Liberation Bonds Series A Leyte 7 430
15 San Juan Pinaglabanan Bonds San Juan, Metro Manila 7 390
16 Carmona Bonds Cavite 7 200
17 Pasay Kaunlaran Bonds Pasay City 7 500
18 Imus Bonds Series A Cavite 7 74
19 Calatagan Municipal Bonds Batangas 7 35
20 Aksyon Padayon Bonds Masbate City 7 160
21 Onward Tacloban Bonds Tacloban City 7 315
Source: Bureau of Local Government Finance, DOF

5.10 The LGUCC was established by the Development Bank of the Philippines (DBP) and the Bank
Association of the Philippines to enhance the flow of commercial funds to the LGUs. The LGUCC
provided a guarantee on loans and credits granted to LGUs by commercial funding sources and on
municipal blond floatation. The specific objectives of the LGUCC are to: (a) expand the LGUs’
borrowing capacity and credit availability; (b) reduce LGUs’ financing costs; (c) improve LGUs’
operating and financial flexibility; (d) reduce credit and other perceived risks of lenders; and (e)
contribute to the development of the local capital market by creating a market for a variety of credit
instruments.

5.11 Build-Operate-Transfer (BOT) Scheme. The BOT arrangement has its basis in Section 302 of
the LGC which states that “LGUs may enter into contracts with any duly pre-qualified individual
contractor for the financing, construction, operation, and maintenance of any financially-viable
infrastructure facility, under the build-operate-transfer agreement subject to applicable provisions of RA
6957 as amended by RA 7718” (or the BOT Law). In a BOT scheme, a private company or consortium
is given the right to build and operate a facility previously provided for by the government. Concession
period is agreed upon, after which the facility is transferred to the LGU. The BOT Center, an agency of
the Department of Trade and Industry (DTI) is mandated by the BOT Law to coordinate and monitor
BOT projects and guide government agencies and LGUs in the preparation and development of BOT
projects. Its main role is to identify financial, technical, institutional, and contractual solutions to help
government agencies make BOT projects work.

5.12 One earlier study on the sources of funds for LGUs was “LGU Financing: Present Sources,
Availability and Terms” prepared by Gavino (1998) of the BOT Center. The paper presented a
compilation and assessment of the sources of financing and showed the constraints faced by LGUs in
accessing private capital. It recommended, among others, that the BOT Center should expand its
provision of technical assistance and other forms of private sector participation in LGU financing.

5.13 The BOT Center’s two core competencies are project development and project monitoring. In
project development, it offers both technical and financial assistance to implementing agencies and

18
LGUs. In project monitoring, it is involved even after the project’s successful tender and award.
Specifically, the BOT Center is concerned with the following:

• Technical assistance—pre-screening of projects for possible financing, review of technical

assumptions, market assessment, and provision of legal advice.

• Financial assistance- in the form of the Project Development Facility which is a loan facility
that can be availed of to finance pre-investment studies and to tender document preparation
including the provision of assistance during the bidding process up to contract award.

• Marketing activities—promotion of the Private Sector Participation Program and projects to

potential investors and project stakeholders through on-line promotions and publications.

• Policy review and formulation - conducted in coordination with implementing agencies and
oversight agencies to create a policy environment that responds to private sector concerns and
ensures the protection of consumers and the public in general.

• Capacity-building - enhancing the skills of LGUs in determining emerging opportunities and

in shepherding projects through the preparation and approval process.

5.14 From Table 7, the construction of public markets and of commercial centers was the popular BOT
projects entered into by the LGUs. Seven of the 17 projects were public markets. The schemes usually
entered into by the LGUs were characterized by the participation of the private sector as the major
sponsor of the project. LGUs preferred this scheme because the private sector assumed certain risks
which had been traditionally borne by the public while the project had not yet been transferred to the
LGUs. These risks included financing, design, construction and operating risks. This is the reason why
only two of the 17 BOT projects were joint ventures between the LGU and the private sector.

5.15 The World Bank places the transfer of knowledge for development and the building of human
and institutional capacity at par with the transfer of financial resources and the building of physical
capacity. It has assisted the Government of the Philippines (GOP) in (a) establishing a revolving fund -
the Municipal Development Fund (MDF) - to provide LGUs with direct access to long-term financing; (b)
created an institutional capacity to assist local governments in project preparation and implementation; (c)
strengthened local technical and financial capacity for project implementation and service management by
creating a Municipal Training Program (MTP); and (d) improved the fiscal performance of local
government by enhancing the RPTA system. The Bank also helped develop a policy framework for local
government financing that encourages stronger LGUs to access market-based credit; provided public
funding and capacity building through the MDF; and targeted funding for poorer LGUs and social and
environmental projects. This policy framework is currently being implemented through the LOGOFIND
which was approved by the Bank in March 1999.

5.16 The LOGOFIND Project expands and upgrades the basic infrastructure, services, and facilities of
participating LGUs and strengthens their capabilities in municipal governance, investment planning,
revenue generation, and project development and implementation. It has four components. The LGU sub-
projects component strengthens, repairs, and improves basic infrastructure, social services, and
environmental facilities. The second component provides training and capacity-building to LGUs in sub-
project development and implementation; municipal planning, finance, and management; improvement of
training modules and delivery mechanisms; and piloting of new programs, including distance learning,
LGU twinning, and collaboration with LGUs, NGOs, and the private sector. The third component

19
supports LGU resources mobilization and monitoring of the RPTA program; new initiatives to improve
credit worthiness and revenue generation; and the development and implementation of systems to
improve the monitoring of LGUs’ fiscal performance. The fourth component supports the reorganization
and strengthening of the MDFO. As of 2005, about 305 LGUs have availed of the LOGOFIND. In
Mindanao, Lanao del Norte had the highest number of municipalities and cities availing of the
LOGOFIND at 11, followed by Lanao with 10 and Surigao del Sur with 9. In the Visayas, Negros had
the highest availing provinces with 24 LGUs, followed by Aklan with 10. In Luzon, Laguna had 10
availing municipalities and cities followed by Camarines Sur with 9.

Table 7. LGUs with BOT Projects

Project Name Area Scheme Estimated Cost
(Million US$)

A Completed Concession
1 Talisay City Hall Project Talisay City, Negros BT 4
Occ.

B Under Concession (Operational)

2 Bohol Provincial Electrical System Province of Bohol JV 14.4
3 Bohol Water Supply System Province of Bohol JV 5
4 Malabon Digital Infrastructure Project Malabon City BTO 0.5
5 Mandaluyong Marketplace Mandaluyong City DOT/BT 23
6 Dapitan Public Market Quezon City BOT 1.3
7 Carmen Public Market Cagayan de Oro City BOT 2.4
8 Cogon Public Market Cagayan de Oro City BT/BOT 4

C Awarded
9 Binirayan Administrative and Province of Antique BOT 3.8
Commercial Center
10 Bocaue Public Market and Commercial Bocaue, Bulacan BOT 5.8
Center
11 Tarlac Public Market Tarlac City BOT 3.6
12 Roxas City Boulevard Commercial Roxas City, Isabela BOT 1
Center
13 Slaughterhouse Cagayan de Oro City BOT 3
14 Matnog Integrated Bus Terminal Matnog, Sorsogon BOT 4.4

D Pre-Award (Bidding Stage)

15 Koronadal City ICT Koronadal City BOT 0.5
16 PUD Modernization PSP/BOT Olongapo City CAO 3.6
17 Davao del Norte Integrated Water Davao del Norte BOT 76.4
Resource Development
Source: BOT Center and BLGF, DOF

Government Accounting

5.17 Assistance in accounting specifically on the promulgation and implementation of the New
Government Accounting System (NGAS) is primarily provided by COA. This is in accordance with its

20
mandate to promulgate accounting rules and regulations pursuant to Article IX-D, Section 2 of the 1987
Constitution.

5.18 The age of power computers, globalization, interconnectivity, and demand for real-time
information and more analytical reports prompted the COA to adopt the NGAS. COA Circular No. 2002-
005 prescribed the Manual on the New Government Accounting System for LGUs to replace the old
government’s accounting system which was conceptualized in the late 1940s and early 1950s. The three
main objectives of the NGAS are to (a) simplify government accounting, (b) conform to international
accounting standards, and (c) generate periodic and relevant financial reports for better monitoring of
performance.

5.19 Among the features of the NGAs are the use of (a) modified accrual basis of accounting, (b)
three-digit standard chart of accounts, (c) responsibility accounting, (d) two-money column trial balance
of balances, (e) asset method in recording purchases, (f) depreciation accounting, and (g) reversing
original entries to correct accounts in the same year. In its effort to promote the use of the NGAS, the
COA is bent on conducting seminars and updating its guidelines. The use of the electronic version of the
NGAS (eNGAs) and the adoption of the international accounting standards in the government are two of
the most significant projects of COA in the pipeline.

5.20 Through the assistance of World Bank, the COA also engaged in a project on LGU Financial
Management and Audit aimed primarily to strengthen the LGUs’ financial management and auditing
skills especially among poorer LGUs where financial management is weak. The two components of this
project were (1) strengthening the financial management of poor LGUs by promoting the development of
adequate controls within the local financial management system, and (2) strengthening the audit system of
LGUs with the complementary capacity building programs.

Internal Auditing

5.21 There are recent developments in the field of internal auditing that will affect the LGUs, most
significant of which is a US$300,000 grant for the Strengthening of Internal Audit Units for Effective
Procurement Monitoring and Enforcement. The grant, funded by the Institutional Development Fund
(IDF) of the World Bank, will support Internal Audit Units of government agencies to perform their
functions in conformity with international standards for the professional practice of internal auditing. A
key result expected is the establishment of adequate internal controls particularly in the procurement
process, thus lowering opportunities for corruption. The strengthening of Internal Audit Units is one of
the major activities in the Government’s National Integrity Development Action Plan crafted during the
Presidential Anti-Corruption Workshop held last December 2004.

5.22 The Presidential Anti-Graft Commission, the agency tasked by President Gloria Macapagal-
Arroyo to strengthen internal audit operations in the bureaucracy, ensures that the grant will fund the
following activities:

• Quality assessment of the internal audit function in selected agencies and development of a
quality assurance program for internal audit units;
• Development of an internal audit manual with appropriate focus on procurement review and
monitoring;
• Development of a national training program for internal auditors;

21
 • Development of an effective and efficient procurement records management and monitoring
system for national agencies; and
• Strengthening of the role of the Presidential Anti-Graft Commission as the oversight agency
in monitoring the performance of internal audit service units.

5.23 Two recent pronouncements significantly affect the practice of internal auditing in the Philippine
government today. These are the (a) Administrative Order (AO) No. 70, issued by the President on April
14, 2003, and the (b) Budget Circular No. 2004-4, issued by the DBM on March 22, 2004. AO No. 70
orders all heads of government offices, agencies, government-owned and/or controlled corporations,
including government financial institutions, state universities and colleges, and LGUs to organize an
Internal Audit Service (IAS) in their respective offices. It also prescribes the conduct of audit in
conformity with the International Standards in the Professional Practice of Internal Auditing and the strict
observance of the Code of Ethics promulgated by the Association of Government Internal Auditor
(AGIA) in the Philippines. It also encourages the AGIA to ensure that all audit works in all government
agencies are conducted in conformity with the standards of the internal audit profession. Budget Circular
No. 2004-4 provides guidelines on the organization and staffing of internal auditing units in all
government offices and agencies mentioned in AO No. 70.

Local Government Budgeting

5.24 Two important sources of budgeting guidelines in the Philippines are the (1) the Budget
Operations Manual for LGUs prepared in 1994 by the DBM and the COA, and (2) the Local Government
Budgeting Manual prepared solely by DBM. The latter covers budgeting procedures for provinces, cities,
and municipalities, including the five phases in budgeting: preparation, authorization, review, execution,
and accountability. The manual also presents the fundamental principles and the roles and functions of
the officers and officials involved in local government budgeting.

5.25 One of the local budgeting principles emphasized in the manual is that local government budgets
should operationalize the approved local development plans—a clear indication of the significant link
between local planning and budgeting as two separate but related functions. The plan specifies the
programs, projects, and activities which should be supported by the funds being budgeted for the period.

5.26 Clearly, the role of DBM is one of oversight. It has the primary role of issuing local budget
circulars, administering the government compensation and position classification plan, and allocating the
IRA among LGUs. It also takes charge of the Municipal Development Fund and the Local Government
Empowerment Fund.

Local Economic Development.

5.27 Local economic development assistance being provided to LGUs revolves around four areas: (a)
project feasibility studies, (b) establishment of local economic enterprises, (c) project management and
financing, and (d) financial packaging. The establishment of local economic enterprise in the locality
was the predominant type of assistance. In terms of the nature of assistance, capability building, actual
project development, and policy making support for local entrepreneurs were the most prevalent.
Capacity building in local economic development entailed training of local officials and employees to
develop strategies and systems that will strengthen the business enabling environment necessary to
promote the competitiveness of firms and create opportunities for new businesses.

22
5.28 Among the national government agencies assisting in the local enterprise development, the DTI
and its attached agencies take the lead. The Board of Investment of DTI provides the annual investment
priorities plan which identifies the priority investment areas and the preferred activities that guide the
LGUs in choosing the areas and sectors to develop. The Bureau of Small and Medium Business
Development helps LGUs complying with various aspects of the enabling laws on Magna Carta for Small
Entreprises (R.A. No. 6977) and its amendments (R.A. No. 8289) so that small and medium enterprises
(SMEs) are promoted and developed in the countryside. The provincial offices of DTI also assists in the
dissemination of laws related to investments such as the Omnibus Investment Code of the Philippines
(E.O. 226), Foreign Investment Act of 1991 (R.A. 7042), Special Economic Zone Act of 1995 (R.A. No.
7916), Barangay Micro Business Enterprises Act of 2002 (R.A. No. 9178), and special laws on specific
areas such as Subic, Clark, etc.

5.29 The NEDA published a Reference Manual on Project Development and Evaluation in 2005 which
guides the local governments in the development of both income-generating projects and social services.
GOCCs, like the DBP and LBP, also provide LGUs specific packages of assistance in local economic
development. The ASIA Foundation and the United States Agency for International Development
(USAID) spearhead the conduct of investment code writeshop and studies on business permits and
licenses systems. Few years back, the German International Development Cooperation established a
national trainers’ training for local enterprise development with key actors coming from the academe.
The Philippines-Canada Local Government Support Program (LGSP) produced in 2003 resource books
on Service Delivery with Impact detailing certain concerns related to solid waste management, water and
sanitation, coastal resource management, health, shelter provision, and local agricultural development
which can be sources of project ideas and methods of putting up economic enterprises.

5.30 The DILG also provides policy directions through issuances of memorandum circulars. The
national pronouncement on job creation was translated into a local economic transformation program for
LGUs by the DILG through MC 2002-48. This circular provides for the philosophy of job creation, the
modernization of agriculture, and the transformation of local leaders into entrepreneurial development
managers. Further, it gives local officials the concrete manifestations of their corporate role and
responsibilities as the local chief executives. The NGOs’ programs are geared towards economic
enterprises development, provision of limited financial assistance, and capacity building activities that
strengthen cooperatives and other CBOs in their target municipalities. These programs reflect their
organizational character, having been formed from communitarian roots. The academe offers courses in
project development and management both as degree programs and as a module in short-term training
programs. Most notable among the institutions offering the course is the Ateneo School of Government
which provides coaching in the packaging of project proposals and feasibility studies after the training of
local officials.

5.31 Among the local economic development initiatives of the IFIs was the Small and Medium
Enterprise Development for Sustainable Employment Program (SMEDSEP), a technical cooperation
project between the Republic of the Philippines, through the DTI and the Technical Education and Skills
Development Authority (TESDA) and the Federal Republic of Germany. This program is an innovative
intervention for enabling and shaping the business environment through the development of
entrepreneurial potential and the stimulation of competition. A component of the SMEDSEP is the Local
and Regional Economic Development (LRED) approach, being piloted in selected LGUs in Leyte
Province where local stakeholders are provided with the methodology and training. The LRED also
assists LGUs in developing and implementing action plans.

Local Development Planning.

23
5.32 All the three groups of respondents provided assistance in local development planning. This was
manifested to a large extent in capacity building and actual planning support. Local development
planning was a highly coordinated LFPM assistance with the LGUs. Assistance takes the nature of
coaching in the preparation of the annual integrated plan which forms the basis for appropriation of
finances and the local appropriation ordinance. The integration of trainings for the community to develop
their own programs for economic development was another nature of assistance. Generally, local
development planning was associated with issues of urban planning and zoning, environmental
protection, and solid waste management.

5.33 The national government through the NEDA takes the lead in setting directions in development
planning. The DILG also takes the lead in rationalizing the planning system through its Rationalized
Planning System Project (RPS). The RPS advocates a rationalized planning system as compliance to the
LGC of 1991 and aims to limit the LGUs’ number of plans only to the comprehensive land use plan
(CLUP) and the comprehensive development plan (CDP). The beauty of the RPS is the advocacy for
NGAs to harmonize or dovetail national planning with local priorities and to avoid confusion at the LGU
level.

5.34 Also the program One Cluster, One Vision for Local Development (OCOV) of the DILG with the
House of Representatives encourages the formal organization of contiguous/geographically adjacent
municipalities within the province with common needs, interests, potentials, and willingness to pool their
available resources for purposes commonly beneficial to them — to meet major development
requirements. OCOV is a project that aims to assist develop contiguous LGUs into growth point centers
that address common needs and interests, improve service delivery; and spur socio-economic
development of the area. The Millennium Development Goals (MDG), which consist of strategies to
fight poverty, ensure human development, and build prosperity for the greatest number of Filipino people,
anchors all development efforts in the country, including the LGUs. The UNDP also sets the tone in
localizing the MDG at the local government level. The Philippines-Australian Community Assistance
Program (PACAP) provides extensive assistance since its inception in 1986, having supported 1,200
activities benefiting about 600,000 people through partnerships with more than 500 NGOs.

5.35 The academic institutions’ curricular programs have local development planning as one of the
core courses. The UP School of Urban and Regional Planning (UPSURP) leads in the provision of
capability building in the following aspects of urban growth management: urban redevelopment, metro-
area development planning, open space planning and management, housing, zoning preparation and
administration, land use planning, infrastructure and utilities planning, site planning, transport planning,
and planning tolls and techniques, including participatory planning techniques. Its special course on
Urban and Regional Planning aims to introduce a model for local planning and development that will
integrate planning in the overall governance function. In this way, the UPSURP hopes to contribute to
the national effort to localize the MDG. The School also publishes the Philippine Planning Journal which
showcases articles related to urban, regional, environment, transport, and land use planning in the
Philippine context.

5.36 One of the most significant interventions in local development planning is the technical assistance
from ADB on Strengthening Provincial and Local Planning and Expenditures Management currently
implemented by NEDA. The technical assistance has four interrelated components: (a) enhancing
cooperation and collaboration of national agencies and LGUs to consolidate the planning-budgeting-
investing linkages; (b) preparing new planning, budgeting and investment guidelines; (c) capacity-

24
building training for governors and city mayors, and planning, budgeting and treasury officers at the local
levels; and (d) enhancing local expenditure management, revenue collection, and project evaluation.

5.37 The World Bank also granted US$467,100 from the Cities Alliance Trust Fund for the project
entitled “City Development Strategies (CDS) in the Philippines: An Enabling Platform for Good
Governance and Improving Service Delivery” of the League of Cities of the Philippines (LCP). The
project aims to enhance the strategic planning, governance, and resource mobilization capabilities of the
cities to contribute to economic growth and urban poverty reduction. The grant, which is co-sponsored by
the Japan Embassy and the Japan International Cooperation Agency (JICA) will finance three key areas
as follows: (a) consolidating and expanding previous CDS with improved methodology through setting
up a well-defined structure, with corresponding benchmarks, result indicators, and a learning program; (b)
facilitating LGU access to a broader range of financing options, enhancing the Capital Investment
Planning approach into a more comprehensive financing framework; and (c) institutionalizing CDS by
integrating it into the national planning process and providing operational support to LCP to promote and
implement the redesigned CDS.

5.38 The Philippines-Canada Local Government Support Program published in 2004 a series of
knowledge tools on “Reclaiming Public Life through Local Special Bodies.” The sourcebooks on
enhancing participation in local governance tackle the nature and modes of strengthening local special
bodies like the local development council, local health board, peace and order council, local school board,
and bids and awards committee which provide important inputs in local development planning.

5.39 The Helvetas Philippines Governance Office contributes to the promotion of participatory
governance especially in local development planning and of the involvement of civil society groups in the
whole project cycle among LGUs.

Procurement Process

5.40 The mapping revealed a small extent of LFPM assistance to the LGUs in the area of procurement.
The nature of assistance was limited to capacity building and provision of planning support. While the
provision of planning support assisted the LGUs in the development of the mandatory Annual
Procurement Plan (APP), other procurement processes like having a standard interpretation of
procurement regulations remained untouched assistance. Part of the birth pains of the new law on
procurement, the Government Procurement Reform Act (GPRA) of 2003 (RA 9184) are the ‘how to’ of
implementing the consolidated laws and regulations of procurement. This is actually the key feature of
the GPRA. Considering that physical infrastructure continues to be a high priority expenditure of the
LGUs, procurement is a major LFPM assistance.

5.41 Interventions of institutions, especially academic institutions and NGOs, created a built-in
pressure for accountability among the LGUs. These included the G-Watch project of the Ateneo School
of Government (ASG) and the Transparent and Accountable Governance (TAG) project of the USAID
that were focused on building awareness on the costs of corruption and on increasing transparency and
accountability in government transaction. These activities increased the opportunities for NGOs and civil
society to become effective partners of the LGUs.

5.42 Table 8 provides the summary of LFPM assistance. Through the study, the following has been
identified:

25
 • Group 1 organizations, except the IFIs, were engaged in capacity building in all areas of
LFPM;
• Group 2 provided policy assistance in all areas of LFPM except in local economic
development where financial assistance was provided. Occasional capacity building was
noted in accounting, budgeting, local development planning, and procurement. Noticeable
was the lack of capacity building in revenue generation, particularly in non-traditional
revenue sources, and internal auditing;
• Group 3 was engaged in all activities of LFPM but capacity building was dominant because
of the assistance extended to the barangays under their jurisdiction.

5.43 As stated earlier, the IFIs provision of support followed a different modality. Most of the
assistance were channeled through a particular NGA or GOCC, which, in turn, implemented the further
delivery of assistance.

Table 8. Areas of LFPM and Assistance Provided in Each Area

LFPM Assistance
Revenue Generation
Real Property Taxation
Business Permits and Licenses
BOT Schemes
Bonds
Accounting
Financial Accounting and
Reporting
Expenditure Management
Assistance for the NGAS
Budgeting
Internal Auditing
Local Economic Development
Project Feasibility Studies
Establishing Local Economic
Enterprise
Project Management and
Financing
Local Development Planning
Procurement
Academe and NGAs and LGUs
NGOs GOCCs
Capacity building Policy Support Capacity Building
Policy Support
Networking
Capacity building Policy Support Policy Support
Networking
Capacity building Policy Support Policy Support
Planning Support Research Studies
Policy Support Policy Support
Project Development
Policy Support Capacity Building
Capacity Building Capacity Building Policy Support
Project Development
Research Studies Capacity Building Capacity Building
Policy Support
Capacity Building Policy Support Capacity Building
Policy Support
Capacity Building Capacity Building Capacity Building
Planning
Capacity Building Policy Support Capacity Building
Policy Support
Capacity Building Capacity Building Research Studies
Financial Assistance Project Development
Financial Assistance
Capacity Building Capacity Building Capacity Building
Policy Support
Financial Assistance
Networking
Capacity Building Financial Assistance Capacity Building
Capacity Building Planning
Financial Assistance
Capacity Building Capacity Building Capacity Building
Networking
Project Development
Capacity Building Policy Support Capacity Building
Capacity Building Planning

26
 Policy Support
Note: Excluding international financial institutions

6. SPECIFIC ASSISTANCE BY DONORS IN LFPM

6.1. This section of the report presents the specific assistance of two major players in LFPM: (a)
international donor agencies; and (b) local academic and training institutions. The internal donor
agencies presented below include (a) Asia Foundation; (b) Asian Development Bank; (c) Australian
Agency for International Development; (d) Canadian International Development Agency; (e) Japan; (f)
New Zealand Assistance for International Development; (g) United States Agency for International
Development; and (h) the World Bank. The local academic institutions whose programs and courses are
described include the (a) Ateneo School of Government; (b) Asian Institute of Management; (c)
Development Academy of the Philippines; (d) Local Government Academy; (e) Institute of Development
and Management of UP Los Baños; and (f) LogoTRI-PhilNet.

Donor Activities in the Philippines

6.2 International aid agencies have a sizeable presence in the Philippines and donor interest remains
high. The Philippines has more than 20 sources of official development assistance (ODA). In 2003, donor
pledges amounted to US$2 billion, of which an estimated US$540 million was grant aid. Japan is the
largest donor (50% of total donor commitments), followed by the ADB (25%) and the World Bank
(21%). Australia is a medium-sized donor in the Philippines and is among the top five bilateral grant aid
donors along with the United States, Japan, Germany, and Canada. The NEDA coordinates and reviews
the ODA.

A. Asian Development Bank

6.3 The Philippines became a member of the ADB in 1966. As of 30 June 2000, 150 loans had been
made to the Philippines totaling $7,549 million. ADB has also provided TA for 268 projects totaling $113
million by 30 June 2000. Among the relevant loan and technical assistance projects were the following:

Loan 1858: Nonbank Financial Governance Program ($75 million: 2001–2003). The
program’s key pillars were (i) strengthening the governance and enforcement capacity of the
regulators, Bangko Sentral ng Pilipinas and the Securities and Exchange Commission (SEC); (ii)
introducing more transparency in the market; and (iii) encouraging equal enforcement of rules
and regulations.

Loan 1363: Capital Market Development Program ($150 million: 1995). The project’s
objectives were to support financial and corporate governance reforms, particularly the
development of capital market institutions with a view to enhancing transparency and
predictability in the marketplace.

TA 31656-02: Strengthening Public Finance and Planning of LGUs–II ($0.100 million:

2002). This technical assistance assisted the government to conduct more detailed analysis of its
budget processing and project-monitoring mechanism.

27
 TA No. 3310: Capacity Building for Procurement ($0.400 million: 2000). This project
strengthened institutions with procurement responsibilities.

TA No. 3245: Nonbank Financial Sector Development ($2.0 million: 2000–2001). Among
other things, this TA focused on reorganizing and strengthening the SEC.

6.4 Capacity Building in LGU Financing. The objective of the TA was to strengthen the in-house
capabilities of the Land Bank of the Philippines to undertake the financing of LGU infrastructure projects,
particularly where the private sector was involved. The assistance was to improve the credit-rating
system by incorporating governance criteria; providing training on private sector modalities; developing
new credit products and enhancements that would catalyze private finance; and preparing the format for a
possible future credit line from ADB. Training activities involved other GFIs and interested groups.
Support for cooperation between the Coordinating Council for Private Sector Participation (CCPSP) and
the Land Bank of the Philippines was also included.

6.5 Technical Assistance for the Local Government Finance and Budget Reform Project. The
TA has two components. Component A provides an analytical overview and detailed studies of key
issues that will help DOF and BLGF design and implement reform in LGU finance and budget processes.
These studies identify factors in the legal, policy, and institutional frameworks that impede LGUs’ ability
to function as autonomous and self-supporting units and propose remedies and concrete action plans to
overcome these problems. Component B enhances the capacity of national government agencies,
particularly BLGF, to provide LGUs with services to improve their finances and create and maintain LGU
financial performance databases that will strengthen LGU credit markets. The TA enhances the skills,
tools, and work programs of BLGF at its main office in Manila and in its regional offices, by conducting
training and other capacity development activities; designing information systems; and developing policy-
supporting mechanisms needed to enhance the bureau’s services.

6.6 LGU Infrastructure Development Facility Project. The Government is pursuing an LGU
financing framework that expands financing sources for LGU-level infrastructure needs. Under this
framework, revenue-generating infrastructure projects, particularly those sponsored by the more credit
worthy LGUs should be opened to the private sector thereby freeing up traditional infrastructure funding
for less credit worthy LGUs and projects with primarily social and environmental objectives.

6.7 Local Government Financing and Budget Reform. This will contribute to the sustainability of
fiscal consolidation by supporting improved LGU delivery of essential services even within a tightening
overall fiscal envelope. The investment climate at the local level would be improved by (a) empowering
LGUs to drive their own development agenda and ensure public service delivery, (b) improving LGU
access to credit and other non-traditional sources of finance, and (c) providing LGUs with the ability to
increase and improve their capital spending for the provision of essential infrastructure. Finally, it will
support sector efficiency by encouraging genuine devolution as envisaged under the LGC; by establishing
more transparent and accountable LGU financial and administrative management systems; by promoting
more coordinated and participatory development planning; and by enhancing the predictability of
resource flows.

B. Asia Foundation and Transparent Accountable Governance

6.8 Countering Corruption: Transparent Accountable Governance (TAG), 1999- 2007. The
TAG Project is implemented by the Asia Foundation with a US$10.5 million grant from the USAID from

28
September 1999 to 2007. TAG aims to build civil society and private sector constituencies for counter-
corruption from an agenda targeting economic growth and poverty reduction. TAG focused initially on
agencies of the national government. The project now extends to the city and municipal level in
Mindanao through the promotion of accountability and transparency in governance. TAG works with 16
cities, representing 60 percent of the cities in Mindanao.

6.9 The Asia Foundation Supports Local Development Planning in Maguindanao. The Project’s
engagement is with 76 municipalities in Autonomous Region of Muslim Mindanao (ARMM) and
neighboring conflict-affected areas. Reforms are targeted to enable city governments to restructure
services to improve efficiency, decrease the costs of doing business, and encourage investments. A
Mindanao Mayors’ Meeting was held in April 2005 where mayors drafted a covenant that committed
them to the development and implementation of the TAG Action Plans.

6.10 Public Service Excellence, Ethics and Accountability Program (PSEEAP). This aims to
establish the values of public service excellence, ethics, and accountability. The program is composed of
six modules that run from six to eight months: service vision and values, service audit, service
improvements, celebrating accomplishments, basic customer service skills, and public service and
accountability. The workshops are facilitated by university-based foundations and NGOs to elicit the
participation of local government employees in improving transparency in operations and the quality of
service delivery. A parallel program of the Philippines Civil Service Commission (CSC) is the
Mamamayan Muna Program, now on in its 11th year of implementation. According to CSC Chair Karina
C. David, the program has “modestly achieved its primary goal of improving public service in the
bureaucracy and of providing the public with a redress mechanism for grievances against ill-mannered
and erring civil servants”.

6.11 Local Development Planning and Budgeting. From 2002 to 2005, the Asia Foundation
provided technical assistance to 57 municipalities and 583 barangays in Mindanao on development
planning and budgeting. The program involved capacity building through team building, group
facilitation methods, data gathering and analysis, and formulation of plans and budgets. It culminated in
the development of barangay and municipal development plans. To date, the project has trained about 360
workshop facilitators.

6.12 Building Capacities of the Muslim Leagues. The Foundation provides institutional funding and
technical assistance for the setting up of a secretariat that will support staff and capacity building of the
Muslim League of Cities, Municipalities and Communities of the Philippines. The Program provides a
two-day orientation on the ethics and accountability program, conducts study tour and cross visits,
produces a newsletter, and develops a web-based database system. There are also two to five days
workshops on resource mobilization, networking, and technical writing. Outside Mindanao are two
projects, namely the eGovernance Initiatives and Public Governance Scorecard Strategy. In the former,
one to two day workshops are provided to orient local chief executives and other information technology
champions in the Visayas on how to get started on eGovernance and on how to outsource systems
development. In the latter, selected city administrators and heads of people’s councils are trained to initiate
and pursue a public governance improvement program. The cities that participate in the PSG project are
San Fernando, Calbayog, Tagbiliran, Naga, Samal, Surigao, Marikina, Iloilo, and Cebu.

C. Australian Agency for International Development

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6.13 Most of the Australian Government's activities in the Philippines include components aimed at
encouraging and assisting good governance, but Australia also funds projects that strengthen institutions
and improve accountability. One major activity underway at present, which Australia is financing jointly
with the ADB, is the "Philippines Regional Municipal Development Project" aimed at improving the
ability of local government to provide, operate, and maintain essential infrastructure and basic services.
The ultimate goal of the project is to improve the living conditions, public health, and urban environment
of the seven participating cities of Bacolod, General Santos, Iligan, Legaspi, Lucena, Puerto Princesa and
Tagbilaran. In addition, a major initiative on good governance has been developed in 1998 between the
Philippine and Australian Governments. The initiative includes technical assistance to strengthen the
ability of national and local public-sector and civil institutions to develop and implement effective
policies in the economic, political and administrative spheres. Australia is also providing support for the
Southern Philippines Council for Peace and Development established by the Philippine Government to
lead and coordinate peace and development efforts in the country's south. The Australian Government
also supports non-government aid agencies active in the Special Zone of Peace and Development in
southern Philippines and in the ARMM.

6.14 Technical Assistance to Physical Planning (TAPP). The project assisted through technical and
training assistance 77 provincial land use committees to refine and improve the processes and outputs of
physical planning and land use decisions.

6.15 Philippines-Australia Governance Facility (PAGF). This was intended to provide responsive
and effective support for governance at the national, regional and local levels. The community
development (CD) program was carried out in Camarines Sur, Agusan del Sur, Albay, Camarines Sur,
Northern Samar, Misamis Oriental, Naga City, and Gingoog City. The project developed a Manual on
Local Development Administration Performance and an Operations Manual on Developmental
Legislation. The facility also supported the Local Development Watch Project of the Bureau of Local
Government Supervision (BLGS); the design of the LGU credit rating system and database; and the
computerized management and monitoring system.

6.16 The Philippines-Australia Technical Support for Agrarian Reform and Rural Development
(PATSARRD), 2003-2006. It assisted the Department of Agrarian Reform and LGUs in involving
farmer beneficiaries into the development planning processes. It was carried out in Agusan del Sur,
Bohol, Northern Samar, Surigao del Norte, Misamis Occidental, and Aklan with an Australian grant of
A$10.0 million.

6.17 Philippines-Australia Local Sustainability Program (PALS), 2004-2009. The PALS 1 was
undertaken with an Australian grant of A$12.0 million from 1999 to 2004. It piloted an integrated
approach to community-based development in six municipalities in Misamis Occidental. The project has
been extended in May 2004. PALS 2 includes the remaining eight municipalities in the province. The
program aims to build the capacity of the LGUs to better plan, implement, and manage sustainable
activities to improve the livelihood of the rural poor. The strengthening activities during the first years
focused on preparatory reviews and assessments of provincial and municipal development plans. Modules
and databases were developed on formulating barangay development plans and barangay profiles,
conducting household surveys, and assessing of coastal resources. Based in Misamis Occidental Province
(Region X) in Mindanao, the program assists both communities and LGUs to plan and manage activities
that improve the livelihoods of the rural poor.

6.18 Philippines- Australia Human Resource Development Facility (PAHRDF), 2004-2009. This
aims to achieve sustainable and equitable development in the Philippines by providing long-term

30
scholarships and short-term specialized training to improve governance and management of key public
and private institutions. The focus of the program is on economic governance; rural development; and
security and stability with special emphasis on Southern Philippines, specifically Bohol, Northern Samar,
Misamis Occidental, Agusan del Sur, and Surigao del Norte.

6.19 Philippines Australia Short Term Training Facility (PASTT). This provides short-targeted
training and human resource development (HRD) support to partner-agencies and key personnel. The
PASTT activities concentrate in southern Philippines particularly Mindanao.

6.20 Philippines-Australia Community Assistance Program (PACAP). This began in 1986 with
the aim of strengthening civil society and reducing poverty. An independent review of PACAP in late
2003 led to a redesign of the program, with new management arrangements. The new PACAP continues
to support community-initiated, sustainable poverty alleviation programs and activities. It also assists
capacity-building initiatives of NGOs, peoples’ organizations (POs) and LGUs to provide services that
meet community needs. PACAP focuses mainly in southern Philippines, particularly in the provinces of
Agusan del Sur, Surigao del Norte, Misamis Occidental, Bohol, and Northern Samar.

6.21 Asia Public Sector Linkages Program (PSLP). This aims to improve public sector capacity for
governance and management for nationally determined development outcomes in selected partner Asian
countries. It aims to transfer capacity building skills and expertise from Australian federal, state and
territory government departments and agencies --as well as universities--to public sector counterpart
institutions in partner countries, and to support the strengthening of sustainable development-focused
public sector bilateral and regional linkages.

D. Canadian International Development Agency

6.22 The Philippine-Canada Local Government Support Program (LGSP), 2000-2006. This is a
capacity development program funded by the Canadian International Development Agency (CIDA). It is
geared towards promoting efficient, responsible, transparent, and accountable governance in targeted
regions in Western Visayas and Mindanao. LGSP implements initiatives and projects to enhance the
capacities of LGUs and civil society organizations in partnership with Local Resource Partners in the
areas of local government management, service delivery, resource generation and mobilization, and
participatory governance. Phase I of LGSP was instituted from 1991 to 1999 with a C$22.4 million grant.
The work continues until August 2006 under the Phase II with a C$34.8 million grant. Phase I and II
supported 205 LGUs consisting of 175 municipalities, 11 cities, and 18 provinces across Mindanao and
Western Visayas. Since December 2004, LGSP has focused on sustaining and institutionalizing results at
the national level with DILG and the LGU leagues, particularly related to local planning, policy
development, replication of exemplary practices, institutionalizing LGPMS, DILG local resource centers,
and DILG organizational development. In 2005, LGSP II was granted an 18-month extension to focus on
sustaining the gains of LGSP through various project activities, aimed at strengthening the enabling
environment for local governance.

6.23 The Philippine-Canada LGSP in ARMM, 2005-2010. This is a C$18.0 million grant that
supports capacity development for all 105 LGUs in the ARMM, selected departments of the Autonomous
Regional Government, and LGU leagues from 2005 to 2010. It collaborates closely with the World
Bank’s ARMM Fund Project and builds on the capacity building frameworks, methodologies, and lessons
learned from LGSP. The Program aims to enhance local government leadership and management, service
delivery, resource generation and management, participatory governance, and peace building.

31
6.24 The Federation of Canadian Municipalities’ Municipal Development Program (MDP),
2002- 2007. This is a program of the Institute of Public Administration of Canada that aims to increase
the capacity of municipal governments to address local issues around social development, environmental
sustainability, and economic well-being; improve the policy and management environment in which
municipalities operate; and strengthen the regional and multilateral networks that support municipalities.
MDP’s program in the Philippines, with a funding of C$300,000, supports partnerships between the
Province of Bohol and Portage La Prairie to implement a strategic planning project in four pilot
municipalities. The pilot projects aim to improve the municipals’ capacity for corporate planning and
budgeting.

6.25 Canada Philippines Partnerships Project for Good Urban Governance, 1994- 2006.
Through this C$1.6M project, the Canadian Urban Institute supports decentralization and empowerment
of communities in Western Visayas. Assistance began in 1994 and the current three-year program will
end in 2006. The Metropolitan Iloilo Initiative through the Metro Iloilo Development Council assists five
local governments to pursue inter-municipal cooperation, regional planning, growth management, and
improvements to regional service delivery.

6.26 Public Sector Capacity Building for Governance and Social Development Program. In the
Philippines, this program partners with the Government of the Province of Manitoba and the LGA to
strengthen the capacity of selected local officials and functionaries of the provinces of Samar and
Benguet, provincial officers of the LGU leagues, and officials of the DILG Region VIII and the Cordillera
Autonomous Region.

6.27 Policy, Training and Technical Assistance Facility (PTTAF) Phase II. Building on Phase I,
the PTTAF II is a facility through which the Philippine government can draw upon Canadian experiences
and capabilities in public sector development. The project targets both the policy level (formulation and
regulation of policy) and the operational level (public management and administration). Sub-project
activities funded through the facility focus on transparent systems, risk management, regulatory capacity,
and court management. Cutting across all activities is the use of appropriate information technology
solutions to enhance transparency, accountability, efficiency, and effectiveness in the work of national
government agencies.

E. Japan

6.28 JSDF Project on Developing Capacities for Pro-Poor Budgeting and Local Government
Accountability for Poverty Reduction Project. This project has been approved for grant funding under
the Japan Social Development Fund facility. It aims to contribute to reducing poverty at the local
government level by increasing participation of the poor and other citizens in tracking poverty incidence,
and in making local government budgets and expenditures more transparent and accountable. The project
has a grant of US$ 718,269 and will be administered by the World Bank. The Caucus of Development
NGO Networks is the grant’s implementing agency.

6.29 Japan Bank for International Cooperation. Japan is the largest donor to the Philippines. It
provides official development loans through the Japan Bank for International Cooperation (JBIC) and
grants and technical assistance through the Japan International Cooperation Agency (JICA). Japan’s
country strategy for official development assistance emphasizes: (i) strengthened economic infrastructure,
especially in power, transport, and industry; (ii) poverty reduction and regional development by

32
promoting rural development and improving basic social services; (iii) environmental conservation and
disaster management; and (iv) human resource development. While Japan does not directly support
financial management and governance activities, it provides indirect support through Japan-based
education and training on financial management and public management.

6.30 Local Governments for Better Public Service Delivery. These projects are expected to respond
to the needs of local residents and promote their participation in development. Projects in the package that
cover administrative support to LGUs include Metro Iligan Regional Infrastructure Development Project,
Fisheries Resources Management Project, and Southern Mindanao Integrated Coastal Zone Management
Projects.

6.31 Local Government Units Support Credit Program. This will provide low-interest and
medium- and long-term fund to LGUs with medium or high credibility, through a policy-based directed
credit program with the Land Bank of the Philippines as a conduit GFI. In this way, the Program intends
to reasonably diversify the fund sources of LGUs in addition to inducing their self-help effort, meeting
their urgent investment needs, and support their implementation of national priority policies in
environment, health and housing, until the tax base is firmly established and the fiscal position of national
and local governments become sound. The Program will be implemented in close coordination with a
country-focused training program for LGUs' officials in the Philippines initiated in FY 1997 by the JICA.
On the other hand, the Program will consider the financing of sub-projects, feasibility study of which was
prepared through assistance from CIDA.

F. New Zealand Aid for International Development (NZAID)

6.32 New Zealand Development Cooperation Programme. The thematic objective of New Zealand
on governance supports activities which seek to enhance the quality and sustainability of governance. Of
particular emphasis are public sector reform at the national level, devolution, and local government
capacity building. NZAID seeks to support two long-term interventions: one on an accountable cash grant
with the DBM, and the other on LGU management training in the CARAGA Region in Mindanao.

6.33 Peace and Development Activities in Mindanao. Support will be provided to the GOP/UN
multi-donor programme for western and central Mindanao and for the proposed Multi-Donor Trust Fund.
NZAID currently supports the Tawi-tawi Community-Based Enterprise Development Assistance Project
(Year 1 of a planned three-year program). A capacity building program on project management is
currently being implemented by Ateneo School of Government (ASG) with NZAID.

G. United States Agency for International Development (USAID)

6.34 Improving the Government Procurement System. This activity supports a government-wide
effort to comprehensively reform the rules and procedures governing public procurement. The overall
objective is to improve the efficiency, speed, and transparency using a broad-based approach. The
USAID project Accelerating Growth, Investment, and Liberalization with Equity provided approximately
US$14 million in a comprehensive, multi-sector assistance package.

6.35 Strengthening Local Government Finance. Assistance is being provided to the Congressional
Committee on Local Government and the DOF in strengthening the financial structure of LGUs and in
legally enabling appropriate amendments to the LGC.

33
6.36 Institutionalizing the Budget Dialogue Group. This activity supports the DBM in its efforts to
increase the participatory nature of the national budgeting process.

6.37 Piloting a Budget Management Information System. The DBM is being assisted to develop a
new budgeting management information system that responds to the need for transparency and
participation in the overall budgeting process.

H. The World Bank

6.38 The World Bank's assistance is primarily for tax administration, financial market development,
and supervision of financial institutions. In 1998, World Bank approved a Banking System Reform
Project 205, which aims to strengthen banking sector regulation and supervision and to develop a
resolution framework for troubled banks.

6.39 Local Government Finance and Development Project (LOGOFIND), 1999–2006. This
us$100 million project assists participating LGUs to expand and upgrade their basic infrastructure
services and facilities and to strengthen their capacities in municipal governance, investment planning,
revenue generation, and project development and implementation. It also enhances capabilities at the
national level to provide technical support and long-term financing to local governments through the
Municipal Development Fund. A project of the DOF through the Municipal Development Fund Office
and funded by the World Bank, the LOGOFIND provides long-term financing and technical support to
LGUs for the implementation of local development projects. The main target beneficiaries of the
LOGOFIND are the low-income LGUs, (i.e., 3rd to 6th income class provinces, cities and municipalities).
However 1st and 2nd income class LGUs may also access LOGOFIND assistance, on a case-to-case
basis, and specifically for social and environmental sub-projects that would improve sanitation,
environment, and quality of life of the urban poor.

• LOGOFIND Sub-loans and Sub-grants for LGU Sub-Projects. This assistance aims to
finance expansion, rehabilitation, and improvement of basic infrastructure and social and
environmental services as well as facilities, including equipment and consultancy services.

• LOGOFIND Technical Assistance for LGU Training and Capacity Building. This aims
to upgrade and enhance the technical as well as technological capacities of the LGUs in
development planning, municipal finance and revenue enhancement, project management,
and social and environmental assessment, among others.

• LOGOFIND Technical Assistance for LGU Resource Mobilization. This aims to

improve and enhance real property tax administration, revenue generation and credit
worthiness of LGUs.

6.40 Philippines Water District Development Project (WDDP), 1999. This project financed
investments to support the national government’s effort to improve sectoral capacity to deliver basic
water supply and sanitation services to consumers. Eligible borrowers included 1st to 3rd class LGUs
outside of Metro Manila.

6.41 Philippines Community-Based Resource Management (CBRM). The main objective of the
project is to reduce rural poverty and environmental degradation through support for locally generated

34
and implemented natural resource management projects. The LGU sub-project investments has a total of
US$54.3 million that would provide eligible LGUs with a mix of grants and loans to finance community-
based resource management projects on a demand-driven basis.

6.42 Philippines ARMM Social Fund Projects. The goals of the project are to reduce poverty and
to provide support mechanisms for the promotion of peace in the conflict-affected areas of the ARMM.
Part of the project’s objective is to improve local governance and institutional capacities focusing on
improved transparency and accountability in the allocation and management of public resources by
participating communities, LGUs, and the ARMM regional government. The project has US$8.80 million
that supports project management, institutional strengthening, and enhanced governance.

6.43 Diversified Farm Income and Market Development Project. The project has macro and micro
interventions. At the macro level is the strengthening of the institutional capacity of the Department of
Agriculture (DA) through improved systems for planning, enforcements, and support for market
development. At the micro level, support is given to focus areas within the framework of devolution:
Region 10 (Bukidnon and Central highlands of Mindanao); Region 7 (Cebu and Negros Oriental);
Region 6 (Panay Island) and CAR. DA investments in rural roads and other infrastructure are also
strengthened by sharpening the selection, approval, and implementation criteria to ensure that market-
oriented investments are supported primarily through LGUs and producer groups.

6.44 Philippines Kapit-Bisig Laban sa Kahirapan (KALAHI) CIDSS. The KALAHI-CIDSS is a

community-driven development project that aims to empower communities through their enhanced
participation in community projects that reduce poverty. Within six years, the project aims to cover 25
percent of the poorest municipalities in the poorest 42 (out of 79) provinces of the Philippines, equivalent
to more than 4,000 villages in 182 municipalities. It strengthens community participation in local
governance and develops local capacity to design, implement, and manage development activities. The
project is implemented by the Department of Social Welfare and Development with the World Bank
providing financial support. The total project cost is US$182.4 million: US$100 million from the World
Bank; US$31.4 million from the national Government; and US$51 million as cash or in-kind
contributions from villagers and their local governments.

6.45 Laguna de Bay Institutional Strengthening and Community Participation, 2003-2009. This
project assists the Laguna Lake Development Authority (LLDA), LGUs, and other stakeholders improve
the environmental quality of the Laguna de Bay watershed. The project has two components: (1) support
for demand-driven investments that will improve the watershed environmental quality, and (2) capacity
building for LLDA, LGUs River Councils, and watershed stakeholders on environmental, social,
technical, and financial and managerial aspects of watershed management.

Training Programs and Degree Courses in LFPM Offered by Local Institutions

A. Ateneo School of Government

6.46 Master in Public Management, major in Local Governance. This program is a 39-unit
masteral degree program for future leaders of the country. It has two categories: Customized Program for
officials and employees who are studying as scholars of a particular organization or institution; and Public
Offering for working professionals who wish to study part-time. Courses in local governance include the
following: Modern Management in Local Governance, Local Government Finance, Local Legislation,
Local Planning and Development, and Local Investment and Enterprise Development. The primary goal

35
of the program is to develop a new breed of public leaders and managers who are visionaries in
orientation, strategic and analytical, technically proficient, politically astute, practical, and ethical.

6.47 Project Development and Management Training Program for LGUs. This program provides
an introduction to the whole project cycle and covers the various aspects of project design specifically
market analysis, technical aspects, management and organization, environmental concerns, financial
analysis, and socio-economic analysis. LGUs are coached on how to design actual local government
projects.

6.48 Competency-Based Capacity Building Program for LGUs. The Ateneo School of
Government is conducting a training program entitled “Competency-based Capability Building Program
for LGUs”. The first batch of 15 participants from the CARAGA Region was trained in capability
building, specifically in Project Development and Management. The project is funded by the NZAID.

6.49 Philippine Governance Forum. This is a joint project of the ASG with the Ateneo Center for
Social Policy and Public Affairs funded by the United Nations Development Program. It aims to promote
greater understanding and operationalization of good governance in the country through various
initiatives intended to enlighten the public on parameters, policies, practices, and strategies that would
bring about greater transparency and accountability of government.
B. Asian Institute of Management

6.50 Program Course on Bridging Leadership. This is a three-day training that uses a new
approach called "bridging leadership." The bridge leader serves as the catalyst that bridges, connects, and
harnesses the interactions among different sectors, thereby focusing globalization on sustainable human
development. It is designed for middle- and top-level managers from the government, NGOs,
development organizations, and donor agencies.

6.51 Program for Development Managers. This is an intensive course designed to prepare
generalist managers for greater responsibilities and more complex management objectives in the
development context.

6.52 Project Planning, Development and Management. The revised course offering provides a
comprehensive exposure and training on the tools of project analysis and management required by
practitioners. It is designed to develop the operational skills needed in each phase of the project cycle, as
well as the strategic skills required to integrate and package projects into effective and sustainable
programs. It builds on basic concepts and techniques in marketing, finance, economics, social analysis,
environmental analysis, and institutional analysis.

6.53 Project and Procurement Management Course in partnership with the International Labor
Organization (ILO). The course aims to broaden and deepen the participant’s ability to design projects
and enhance his/her knowledge and skills in the procurement of goods and services for the successful
implementation of projects.

C. Development Academy of the Philippines (DAP)

6.54 Formulating Strategic Options for LGU Revenue Generation and Resource Mobilization.
The course provides an understanding of the concepts and principles of good fiscal governance. It teaches
the five-step model for LGU revenue generation and resource mobilization. The course covers important

36
concepts and principles of good fiscal governance; traditional and non-traditional practices of revenue
generation and resource mobilization; strategies for revenue generation and resource mobilization; and
indicators for efficient local fiscal administration.

6.55 Fund Sourcing Seminar. The course explores funding options and sources for projects. Local
chief executives and local government staff involved in project development learn the requirements,
packages of assistance, and financing programs of foreign funding institutions for LGUs. Topics include
legal framework for LGU financing, alternative funding schemes for local development, and information
on other financing institutions.

6.56 Enterprise Development Course for Micro-Projects at the Local Level. The course addresses
the need to develop capabilities at the local level in planning and managing local enterprises. Particularly,
it assists local institutions involved in coordinating small enterprise activities as well as existing and
potential entrepreneurs in identifying appropriate micro-projects. Modules include the role of small
business enterprise in national development, small enterprise identification, and business project
formulation.

6.57 Master in Public Management. The DAP currently offers the Master in Public Management
(MPM), a regular offering and the MPM major in Local Governance Management. These programs are
distinctly oriented to the requirements of building strong theoretical foundations for the public sector
manager. The programs aim to validate these requirements in concrete forms through case studies,
fieldwork, and other practical applications.

6.58 Training Courses - Graduate School of Public and Development Management. The training
courses offered include (a) Philippine Quality Award; (b) Productivity and Quality for the Academe; (c)
Productivity and Quality for LGUs; and (d) Development Program for Productivity Champions.

D. Local Government Academy

6.59 Leadership and Organizational Development includes the following courses: Municipal
Capability Building Plan Formulation Workshop to Raise the Level of Organizational Effectiveness;
Streamlining Regulatory System: An Anti-Red Tape Seminar Workshop for Local Chief Executives and
Functionaries; Workshop to Raise the Level of Organizational Effectiveness; and Executive Course for
Enhanced Leadership.

6.60 Planning For Local Development has the following courses: Strategic Planning Seminar
Workshop Training on Mapping and Land Use; Executive and Legislative Agenda for Local Governance
and Development; Local Prosperity Promotion Planning Training Program; Jumpstarting Local
Development: Managing the First Steps: A Course for Newly Elected Local Officials; and Looking
Forward to Better Governance: A Continuing Competency Building Course for Re-elected Local
Officials.

6.61 The courses under the Development and Management of Projects are as follows: Project
Development; Orientation Conference on the Implementation and Management of Projects; Training on
Contract Management and Project Procurement Procedures; Seminar-Workshop on World Bank
Procurement Procedures; Seminar Workshop on Project Appraisal; Project Post Evaluation Concepts and
Procedures; and Project Evaluation.

37
6.62 Urban Management has the following courses: Training on Urban Management for LGUs;
Mainstreaming the Informal Sector; and Institutional Capacity Building on Public-Private Partnership for
LGUs: The Financial and Legal Perspectives.

6.63 Courses on Resource Mobilization and Generation include: Bond Floatation and Other Credit
Financing Schemes Under Public-Private Partnership; Seminar/Workshop on Resource Mobilization and
Updating the Local Revenue Code; and Local Government Resource Mobilization and Financial
Management Analysis.

6.64 The Municipal Enterprise Development and Management has the following courses:
Seminar/Workshop on Public Market Administration; Seminar/Workshop on Slaughterhouse
Management; and Seminar/Workshop on Bus Terminal Management

6.65 The regular training programs and the corresponding courses are as follows: (1) Local Prosperity
Promotion Program—Training on Project Development and Management; Training Course on Feasibility
Study; and Executive and Legislative Agenda for Local Governance and Development; (2) Fiscal
Management—Professionalizing Local Fiscal Managers: A Key to Greater Local Fiscal Autonomy; and
Seminar/Workshop on Resource Mobilization and Updating the Local Revenue Code; (3) Barangay
Governance and Development Program—Excellence in Barangay Governance: Capacitating Barangay
Officials (4) Urban Management—Institutional Capacity Building Program on Public-Private Partnership
for LGUs in the Philippines: The Financial and Legal Perspectives; and Orientation Course on Spatial
Planning and Decision Support System for LGUs.
E. Institute of Development Management and Governance, UP Los Baños

6.66 Master in Public Affairs. This program offered by UP Los Baños has five areas of
specialization: Agrarian and Urban Development Studies, Cooperative Management, Education
Management, Local Governance and Development, and Strategic Planning and Public Advocacy. The
program aims to educate both current as well as future professionals in key positions of both government
and non-government institutions to make them better decision makers, leaders, planners, and program
implementers. It provides a strong foundation for graduates to have a better appreciation of issues and
capability in dealing with these issues emerging in the process of development and local governance.

6.67 Master of Management major in Development Management. The program has two courses
related to LFPM: Fiscal Administration in Development and Management Accounting and Control.

6.68 The Innovative Governance Forum. The forum is an annual event focusing on harnessing
innovative practices for sound development and good local governance. It was conceived to address the
improvement of the delivery of public service in areas of national concern.

F. Local Governance Training and Resource Institutes - Philippine Network (LoGoTRI-PhilNet).

6.69 This is a non-stock, non-profit national association that acts as a catalyst of change for local
governments’ institutional development by providing relevant programs and services to empower the
participation of the civil society and the private sector for good governance. Major academic institutions
are also part of this network like the DAP, Ateneo, NCPAG, De La Salle University (DLSU), and others.
The training program offerings of the network are oftentimes the training offerings of the academic
institutions.

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6.69 Table 9 is the summary of LFPM trainings and related curricular programs offered by local
institutions.
Table 9. List of LFPM and LFPM-Related Courses and Providers
AREAS OF TITLE/NATURE OF TRAINING TRAINING PROVIDER
LFPM
Revenue Formulating Strategic Options for LGU Revenue DAP
Generation Generation and Resource Mobilization
Resource Generation and Mobilization (Bond LGA
Floatation and Other Credit Financing Schemes),
Updating Local Revenue Code, Local Government
Resource Mobilization and Financial Management
Analysis
Resource Generation/Mobilization CLRG-UP Diliman,
BLGF, LGSP-CIDA
Accounting Accounting seminars and trainings COA, AGIA, PICPA
Internal Seminars and trainings COA, AGIA, PICAP
Auditing
Budgeting LGA, COA, DBM,
Seminars and trainings USA RCPMG, CLRG-
UP Diliman
Local Enterprise Development Course for Micro-Projects at DAP
Economic the Local Level SEED/ CREMDEC
Development Enterprise Development
Public Enterprise System USA RCPMG
Municipal Enterprise Development and Management LGA, ASG
Local Prosperity Promotion Program (LPP) LGA
Local Project Planning, Development and Management AIM
Development Project implementation, monitoring and evaluation, ASG
Planning LOGFRAME, community mobilization project
Barangay Governance and Development Program
Planning for Local Development LGA
Procurement Project and Procurement Management Course AIM with ILO
Procurement programs ADMU, DLSU,
PMMAP
Procurement seminars ADB, AGIA, PICPA
Philippine Governance Forum ADMU
Curricular Master in Public Management DAP
Programs MPM major in Local Governance Management
Master in Public Affairs, major in Local Governance IDMG-UPLB
and Development
Master in Management Development Management
Certificate and degree programs in Public NCPAG-UP Diliman
Administration
Certificate and degree program in Governance DLSU Institute of
Governance
Certificate in Barangay Administration UP Open University
Master in Public Management, major in Local ASG
Governance
Course on Bridging Leadership AIM
Masters Program in Development Management

7. INSTITUTIONAL ARRANGEMENTS

Methods of Tapping LGU Beneficiaries

7.1 This section describes the institutional arrangements in supporting the LGUs in local finance. The
three groups of respondents provided support to LGUs based primarily on the initiatives of the local
government officials themselves. Majority of the assistance providers based their grant of support on the
LGUs’ formal request for assistance. This involved the submission of a written request from the local

39
chief executive (LCE) indicating the need for certain types of support. The request was more often
accompanied by a proposal containing the need to be addressed by the LGU including the target time
frame, responsible office and cooperating offices, and expected outputs.

7.2 Moreover, LGUs may avail of support through informal means. Local officials may express their
desire for support through dialogues, attendance to meetings, and participation in public fora. They may
also make an informal request by visiting the organizations providing support. In some instance, some
LGUs directly submitted proposals to funding agencies. Donors and providers of assistance preferred that
the initiative came from the LGUs themselves, as such implied a higher level of ownership and support
for a possible program.

7.3 The second mode of tapping LGU partner-beneficiaries was the referral of other organizations,
agencies or offices. The referral came primarily from some LGUs that had knowledge about the needs of
other LGUs. Referrals were also made by NGOs, NGAs, and private organizations.

7.4 Support providers also extended previous partnerships. Because of fruitful relationships in the
past resulting to mutual benefits, the same partnership undertakings may be repeated or extended.
Common membership of both the support providers and the LGU beneficiaries in the same organization
can become the basis of a partnership that entails provision of support in LFPM. Partnership can also be
expanded especially if the undertaking has provisions for replication.

7.5 The two least commonly used modes of seeking LGUs as partner-beneficiaries were (a)
identification or selection by donor-providers themselves, and (b) search through public announcement.
Donor-providers usually selected LGUs that have been their partners in the past, although there may be
new or different arrangements, such as selections based on some predetermined criteria. When public
announcement was used, the donors generally resorted to internet posting and sending of messages to
those in the mailing list. Announcements in newsletters and advertisements in radio and television were
used only by Group 1 and Group 3 respondents. Advertisements in newspapers and printed materials were
used only by Group 3 respondents (LGUs). The other mode which was not identified by the respondents
but is currently practiced is when the NGAs propose for a project to donor agencies with LGUs as one of
the recipients of the grant. If the assistance is a loan, the LGUs are most commonly identified based on
the need or problem being addressed by the project proposed.

Forms of Working Arrangements

7.6 There were generally formal working arrangements in the provision of support to LGUs primarily
through a Memorandum of Agreement and Memorandum of Understanding. The secondary forms of
arrangements were contracts and program documents in the case of technical and financial cooperations.
The terms and conditions for donors in the order of priority were (a) provision of technical assistance or
expert services, (b) monitoring and evaluation, (c) compliance to agreed terms of reference, (d) conduct of
baseline survey before collaboration or assistance is made, (e) impact assessment, and (f) timely release
of funds.

7.7 For the LGU beneficiary, the prioritized terms and conditions were (a) counterpart funds or
resources, (b) proposed area of collaboration within the priority areas, (c) delivery of agreed objectives or
expected outputs of collaboration, (d) demonstration of readiness or passing a readiness assessment, (e)
submission of technical reports of collaboration, (f) submission of financial reports, and (g) acceptance of
structural adjustments that are packaged with the assistance. The cost of support varied according to the

40
groups of organizations. There were three major costs involved: direct cash outlay, facilities and
equipment, and non-cash expenses.

7.8 The support provided to the LGUs produced tangible outputs, which subsequently generated
tangible and intangible assets and developed the LGUs’ skills and capabilities. All of these ensued
certain benefits to the LGUs as organizations and enhanced their awareness for large-scale local
community participation (Figure 2). The specific outputs of the LGUs were (a) trainings, seminars, and
workshops attended, (b) plans formulated, (c) programs and projects designed, (d) policies formulated,
analyzed, and passed, (e) systems, procedures, and protocols established, and (f) study, research, and
survey results generated. Regarded as secondary outputs were (a) study sites visited and (b) modern
equipment and facilities secured.

7.9 Majority of the support provided to LGUs also generated assets. These were primarily in the
form of (a) trained human resources, (b) improved systems, procedures, and protocols, (c) additional
institutional linkages or networks, and (d) enhanced LGU service facilities. Other resources generated,
though of minimal magnitude, included: (a) additional funds, (b) equipment, (c) more supplies, and (d)
intellectual properties.

7.10 Almost all (92.3%) of the organizations giving support also developed or improved certain
specific skills and capabilities. Majority of them gained skills and capabilities in (a) project management,
(b) project development, (c) monitoring and evaluation, (d) policy formulation, development, and
analysis, (e) planning, (f) budgeting, and (g) income generation. On the other hand, a small number of
respondents gained skills and capabilities in (a) financial planning, (b) conduct of studies, researches, and
surveys, (c) financial analysis, (d) use of information, communication, and technology (ICT) equipment,
(e) financial management, and (f) feasibility studies.

7.11 The benefits derived by the LGUs were (a) improved quality of LGU projects in areas other than
LFPM, (b) improved observance of transparency and accountability principles, (c) enhanced
organizational efficiency and effectiveness, (d) improved public perception and participation, and (e)
increased LGUs visibility to the public. The least benefit considered by the respondent organizations was
increased public investments.

7.12 More than three-fourths (76.92%) of the respondent organizations believed that the support
extended to LGUs created an awareness for large-scale local community participation. In other words,
through the support extended to the LGUs, the local officials were able to reach a larger number of their
constituents, which enhanced the latter’s awareness that they needed to participate in local government
initiatives. This fact is supported by the (a) improved turnout rate of LGU-initiated activities, (b)
increased LGU revenue collection, and (c) higher impact assessment results.

41
 ASSETS GENERATED

Primary
• Trained human resources
• Improved systems,
procedures, and protocols
• Additional institutional
linkages or networks
• Enhanced LGU service
facilities
OUTPUTS
Secondary
• Additional funds
Primary • Equipment
• Training, seminars and • Additional supplies
workshops attended
• Intellectual properties
• Plans formulated
• Programs and projects
designed SKILLS AND
• Policies formulated, analyzed,
and passed CAPABILITIES
DEVELOPED
• Systems, procedures, and
protocols established
• Study, research, and survey Primary
results generated • Project management
• Project development
Secondary • Monitoring and evaluation
• Study sites visited • Policy formulation,
• Modern equipment and development, and analysis
facilities provided • Planning skills
• Budgeting
• Income generation
capability
BENEFITS
Primary
• Improved quality of LGU
projects in other areas
• Improved transparency and
accountability
• Enhanced organizational
efficiency and effectiveness
• Improved public perception
and participation
• Increased visibility to public
Secondary
• Increased public investments
AWARENESS FOR LARGE-
SCALE LOCAL COMMUNITY
PARTICIPATION
• Improved turnout rate of LGU-
initiated activities
• Increased LGU revenue
collection
• Higher impact assessment
results

Secondary
• Financial planning
• Conduct of studies,
researches, and surveys
• Financial analysis
• Use of ICT equipment
• Financial management
• Feasibility studies

Figure 2. Outputs from Support in LFPM

42
7.13 The organizations expressed satisfaction with the quality of their working relationship with the LGUs.
Majority (87.18%) gave an affirmative response for satisfaction. The satisfaction for LGUs pertained to their
relationship with a lower level of local government to whom they provided support. Almost all (96.67%) of
the respondents expressed the highest level of satisfaction to the question “Are you satisfied with the quality of
your work relationship with the LGU?” Their reasons for satisfaction in order of significance were as follows:
(a) the relationship provided mutual benefits to collaborating parties, (b) there were no serious problems
encountered, (c) the relationship was flexible and allowed room for necessary adjustments without much
difficulty, and (d) the working relationship was ideal, can meet expectations, and can produce the deliverables.
A relatively small percentage of respondents believed that the relationship was independent of political agenda.

7.14 The major reasons of those who were dissatisfied with the working relationship with the LGUs were
(a) the relationship was being associated with the LGU’s political agenda, (b) the existing working relationship
was problematic and there were gaps in various aspects, and (c) the working relationship cannot always deliver
what it is supposed to deliver. A perceived association with the political agenda often led to biased judgment
on existing working relationships, making even the simplest transaction very slow and problematic.

Provision of LFPM Support as Mandate

7.15 Majority (64.23%) of the respondent organizations regarded their organizations as having mandates to
provide support in LFPM to LGUs (Table 10). However, the kind of mandate and the extent of support
differed among the groups.

Table 10. Number of Organizations with Mandate to Provide Support in LFPM

GROUP 1 GROUP 2 GROUP 3 TOTAL
Frequency % Frequency % Frequency % Frequency %
With
mandates 23 58.97 14 63.64 42 67.74 79 64.23
No
mandates 16 41.03 8 36.36 20 32.26 44 35.77

Total 39 100 22 100 62 100 123 100

7.16 Less than half (41.03%) of the Group 1 respondents, particularly the NGOs, said that they had an
indirect mandate to help LGUs in LFPM since their support for the latter was just incidental in accomplishing
their primary mandates. Their primary operations actually revolved around other fields like micro and small
enterprise development, environmental protection, integrated area development, participatory governance, and
extension programs. However, their programs/ projects in these areas had financial components which
entailed them to deal with LGUs on matters related to LFPM. Thus, the extent of support for LFPM may be
said to be rather limited because this was incidental to their primary mandates. They cannot engage in full
LFPM support especially if it is outside the realms of their major operations.

7.17 The percentage of Group 2 respondents (NGAs and GOCCs) who reported that they had mandates to
support LFPM was relatively higher (63.64%). This is because government agencies have the Constitution,
republic acts, presidential decrees, and executive orders as legal bases to support LGUs. Thus, the mandate
can be categorized as direct support to LGUs. Nonetheless, for these government agencies, LFPM was just
one of the many services they covered. It was also evident that the government agencies had LFPM area-
specific mandates. For example, the GFIs were concerned specifically with credit financing; COA was
primarily involved in accounting and auditing; DBM was focused on budgeting and procurement; and NEDA
was geared towards development planning, and so on.

7.18 For Group 3 respondents (LGUs), it was quite disconcerting that 35.77 percent of the respondents
did not consider LFPM assistance as part of their mandates. The Constitution and the LGC are supposedly
the primary sources of mandates for inter-LGU support system. Others had local issuances like
ordinances that should rationalize their support to other LGUs in specified LFPM areas. Still, others had

43
the local chief executive’s agenda or leadership discretion as the primary basis for claiming a mandate for
LFPM assistance.

Interest for Partnership with EPRA

7.19 Almost all (86.18%) of the organizations surveyed expressed their interest to enter into
partnership with the Economic Policy and Reform Advocacy (EPRA) program. Such interest was higher
in Group 1 (94.87%) and Group 3 (90.32%) than in government agencies (59.09%) as shown in Table 11.

Table 11. Number of Organizations Interested in the EPRA Partnership

GROUP 1 GROUP 2 GROUP 3 TOTAL

Frequency % Frequency % Frequency % Frequency %
With
Interest 37 94.87 13 59.09 56 90.32 106 86.18
No
Interest 2 5.13 9 40.91 6 9.68 17 13.82

Total 39 100 22 100 62 100 123 100

7.20 Among Group 1 respondents, the types of arrangement with the EPRA can be through (a)
collaborative research; (b) joint capacity building activities; (c) joint program or project implementation;
(d) serving as a regional conduit or regional extension partner of EPRA; (e) expertise sharing in various
services like livelihood development, peace and development, and regional planning; and (f) serving as
client-beneficiary of EPRA in institution building.

7.21 Among government agencies, the types of arrangement were through (a) information sharing; (b)
serving as EPRA’s local resource person; (c) partnership in policies to further improve the LGUs; and (d)
provision of financial assistance to EPRA LGU-clients.

7.22 LGUs were willing to enter into partnership with the EPRA through various arrangements but
prioritized as follows: (a) capacity building packages for LGUs specifically trainings on LFPM-specific
areas (e.g., innovative revenue-generation, local economic development, and project feasibility studies);
(b) enhancement of LGU capacity in policy formulation/development and analysis; (c) making LGUs as
subjects of EPRA researches; (d) enhancement of the research competencies of LGUs both at the
individual and organization levels; (e) development of investment centers and business promotion; and (f)
equipment facility donation.

44
8. FACILITATING FACTORS IN LFPM

8.1 Seven factors that facilitated the successful conduct of support in LFPM were identified by the
respondents. The percentage of responses was translated into verbal interpretation. The equivalent extent
of contribution of the facilitating factors was as follows:

Verbal Interpretation Extent of Contribution as

Facilitating Factor
0-19.99 Poor Not at all
20-39.99 Fair Small extent
40-59.99 Satisfactory Moderate extent
60-79.99 Very Satisfactory Large extent
80-100 Excellent Great deal

8.2 Of the seven factors facilitating LFPM, the staff behavior was cited by 80.20 percent of the
respondent organizations surveyed. Its verbal interpretation of “excellent” implies that it was significant
to a “great deal” in the attainment of the desired results from LFPM support (Table 12). The other factors
that helped to a “large extent” were objectives of support (75.73%), political stability (64.44%),
institutional processes (64.27%), and participatory approach (62.91%). Financial transparency (57.78%)
and financial accountability (57.09%) also facilitated to a “moderate extent” the LFPM support to LGUs.

Table 12. Seven Facilitating Factors in LFPM

Facilitating Factors % Verbal Extent of Rank

Interpretation Contribution
Objectives of support 75.73 VS LE 2
Political feasibility 64.44 VS LE 3
Staff behavior 80.20 E GD 1
Institutional processes 64.27 VS LE 4
Participatory approach 62.91 VS LE 5
Financial accountability 57.09 S ME 7
Financial transparency 57.78 S ME 6

Legend: 0-19.99 (Poor/Not at All); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-
79.99 (Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal); VS (Very satisfactory), S (satisfactory), E
(Excellent).

Objectives of Support

8.3 Majority (75.73%) of the respondents believed that the clarity of objectives, familiarity with the
objectives, involvement of both parties in a partnership, and the translation of objectives to operation
plans all fostered the successful provision of LFPM assistance to LGUs (Table 13). The clarity of
objectives was observed to be in place by 77.78 percent of the organizations surveyed. In effect, it
indicated that there was a “very satisfactory” level in the clarity of objectives in the provision of
assistance to LGUs. The clarity of objectives as well as the LGU’s knowledge, awareness and familiarity
with these objectives may have contributed to a large extent in the successful provision of support for
LFPM.

45
8.4 The objectives for support must also be understood by the LGU clients. This factor was cited by
76.92 percent of the LGUs indicating a “very satisfactory” compliance. A common understanding of the
objectives between the partners was cited by 75.21 percent of the respondents. A total of 75.21 percent of
the respondents also said that their objectives defined the stakeholders’ involvement. This implied that
the three factors contributed to a “large extent” in the LFPM support for LGUs because these provided a
conducive situation for the active participation of partners and stakeholders.

8.5 Majority (73.5%) of the respondents also believed that the objectives of support were translated
to operational plans, indicating a “very satisfactory” performance among the organizations surveyed. It is
important that the objectives can be translated and interpreted in concrete directions and actions to ensure
active participation of leaders and stakeholders.

Table 13. Percentage Scores on Objectives of Support

Objectives of Support Verbal Extent of Rank

% Interpretation Contribution
Does your support to the local Very Large Extent 1
government have clear objectives? 77.78 Satisfactory
Are the objectives of your support known Very Large Extent 2
by the local government? 76.92 Satisfactory
Are the objectives of both institutions Very Large Extent 3.5
clear and specific on both sides? 75.21 Satisfactory
Do your objectives define the local Very Large Extent 3.5
stakeholders' involvement? 75.21 Satisfactory
Are your objectives of support translated Very Large Extent 5
to operational plans? 73.50 Satisfactory
Very Large
Total 75.73 Satisfactory Extent

Legend: 0-19.99 (Poor/Not at All); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-
79.99 (Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

Political Feasibility

8.6 Political feasibility deals with the degree of power that the leaders have in deciding whether to
continue the support or not. In other words, it is of primary importance that once a support is established
and is found to be beneficial, a decision about its commitment and sustainability should be firm.
Likewise, the community’s satisfaction with the support mechanism reinforces the positive outlook of the
leaders and enhances the support’s sustainability.

8.7 The study revealed that political feasibility existed for 64.44 percent of the respondents,
indicating a “very satisfactory” support landscape for LFPM. As such, this factor facilitated the success
of LFPM support to LGUs to a “large extent” (Table 14). The aspects of political stability determined to
be contributory were alignment of support with the LGU’s vision and mission (74.36%); adequate room
for the organization leaders to decide the pursuance of support (69.23%); prioritization of the provision of
support by the organizational leadership (64.96%); and consideration of community satisfaction in the
mechanisms used to deliver the support (61.54%). The existence of a long-term strategy for local
government support was considered to be facilitating factor to a “moderate extent” by 52.14% percent of

46
the respondents. The “very satisfactory” assistance manifested has some bearing on the multitude of
assistance provided to LGUs since the 1991 decentralization. Local government leadership was generally
satisfied with the support landscape it was receiving specially support with direct financial assistance.
This also points to the fact that LGUs are performing their mandates with the assistance of institutions.

Table 14. Percentage Scores on Political Feasibility

Political Feasibility Verbal Extent of Rank

% Interpretation Contribution
Is there a long-term strategy for local Satisfactory Moderate 5
government support? 52.14 Extent
Is the provision of support a priority of Very
your organizational leadership? 64.96 Satisfactory Large Extent 3
Are the plans and programs of support in Very
line with the LGUs’ vision and mission? 74.36 Satisfactory Large Extent 1
In general, is the community satisfied Very
with the mechanisms used to deliver the 61.54 Satisfactory Large Extent 4
support to the LGUs?
Is there enough room on the part of your Very
leaders to decide the pursuance of support 69.23 Satisfactory Large Extent 2
to the LGUs?
Very
Total 64.44 Satisfactory Large Extent

Legend: 0-19.99 (Poor/Not all); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-79.99
(Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

Staff Behavior

8.8 The quality of staff is manifested in both the character traits and behavior of the employees who
are directly involved in the provision of support to LGUs. Table 15 shows that 80.20 percent of the
respondent organizations said their staff had this quality. Three distinct traits of the staff were rated
“excellent” or contributory to a “great deal” in the success of LFPM assistance. These were friendliness
and approachability to the LGU client-partners (83.76%); rapport with the client (83.76%); and
willingness to provide as much assistance as possible (81.2%). This result confirms the findings in many
collaborative undertakings that the soft skills and affective qualities of staff are indeed prerequisites for
more harmonious working relationships. Benefits from the technical expertise of staff are maximized
when shared in an atmosphere of genuine friendship and desire to help.

8.9 The behaviors that helped accomplish tasks were the following: allowing the client-partners to
provide inputs or suggestions to the programs or projects (79.49%); providing quick responses to client-
partners in need (77.78%); and exhibiting expertise on the job (75.21%). The survey showed that the staff
in LGUs (96.67%) were generally rated to be better in meeting the requirements for LFPM assistance
than the staff in the national government and GOCCs (84.17%), and international funding agencies,
NGOs, and academic institutions (80.63%).

47
 Table 15. Percentage Scores on Staff Behavior

Staff Behavior Verbal Extent of Rank

% Interpretation Contribution
Are your staff friendly and approachable
to the LGU client-partners? 83.76 Excellent Great Deal 1.5
Are your staff willing to provide as much
assistance to the LGU client-partners? 81.2 Excellent Great Deal 3
Very
Do your staff exhibit expertise on the job? 75.21 Satisfactory Large Extent 6
Do your staff provide quick responses to Very
your LGU client-partners in need? 77.78 Satisfactory Large Extent 5
Do your staff allow the LGU client- Very
partners to provide inputs or suggestions 79.49 Satisfactory Large Extent 4
to the programs/projects?
In general, has rapport been developed
between your staff and the LGU client? 83.76 Excellent Great Deal 1.5
Total 80.2 Excellent Great Deal

Legend: 0-19.99 (Poor/Not all); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-79.99
(Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

8.10 On the other hand, these results also confirm that soft skills seemed to be prioritized in favor of
the technical competencies needed to excel in the job. The job description of the local finance committee
requires much more than soft skills. For example, in the duties and responsibilities of the local finance
committee, the treasurer advises the LCE on ‘the disposition of local government funds’ (Title 5, Article
2: Section 470 of LGC of 1991); the accountant ‘apprises the sanggunian and other LGU offcials on the
financial condition and operations of the LGUs’ (Title 5, Article 4: Section 474 of LGC of 1991); the
budget officer ‘reviews and consolidates the budget proposals of the different departments of the LGUs
and assists the LCEs as the case maybe’ (Title 5, Article 4: Section 475 of LGC of 1991); and the
planning and development coordinator ‘analyzes the income and expenditure patterns and formulates and
recommends fiscal plans and policies for consideration of the local finance committee’ (Title 5, Article 6:
Section 476 of LGC of 1991). These identified major responsibilities of the members of the local finance
committee often are not performed creating what the LOGOFIND termed as the ‘vacuum’ in local
governance or to certain extent missing out on the most in demand need of the LGUs (i.e. to generate
resources). Likewise, a shift in the perception of operational orientation, skills and processes, and
commitment to the required internal competency changes is needed.

Institutional Processes

8.11 Various aspects of institutional processes were noted to be proper and in order by 64.27 percent
of the respondent organizations (Table 16). This factor was rated to be “very satisfactory” and the quality
of institutional processes facilitated to a “large extent” the success in FPM initiatives. Clear and orderly
institutional processes allow the activities to progress with the fewest unintended setbacks and the least

48
possible imposition of social costs. The aspects of institutional processes that were regarded as favorable
to a “large extent” were availability of procedures and guidelines in the implementation of plans and
programs (67.52%); existence of mechanisms using the local councils or board (66.67%); adequacy of
mechanisms for review, evaluation, and implementation of plans and programs (65.81%); and presence of
a coordinating body that manages the support program (62.39%). These factors point to clear institutional
arrangements and planning processes that enabled the activities to be interrelated and interconnected
towards the attainment of program objectives. Efficient programming was rated to be in place to a
“moderate extent” by 58.97 percent of the respondents.

Table 16. Percentage Scores on Institutional Processes

Institutional Processes Verbal Extent of Rank

% Interpretation Contribution
Is there a coordinating body that manages Very
the support program to the LGU? 62.39 Satisfactory Large Extent 4
Are there procedures and guidelines to Very
facilitate the implementation of plans and 67.52 Satisfactory Large Extent 1
programs with the LGU?
Does the support allow for mechanisms that Very
make use of established local councils or 66.67 Satisfactory Large Extent 2
board?
Are there mechanism for review, Very
evaluation, and improvement of plans and 65.81 Satisfactory Large Extent 3
programs?
Do you achieve your client-partners’ goals Satisfactory Moderate
because of efficient programming? 58.97 Extent 5
Very
Total 64.27 Satisfactory Large Extent
Legend: 0-19.99 (Poor/Not all); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-79.99
(Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

Participatory Approach

8.12 Participatory approach was noted to be practiced by 62.91 percent of the respondent
organizations, indicating a “very satisfactory” compliance to the participatory approach (Table 17). This
also showed that participation was alive among the support-providers of LFPM to LGUs. Indeed,
participation among the partner-beneficiaries is very important. Four aspects were regarded as facilitating
factors to a “large extent”, namely: involving the LGU clients in the identification and prioritization of
focus of support (67.52%); determining operating policies with client-partners (64.1%); involving client-
partners in monitoring the status of support (64.1%); and conducting regular meetings and consultations
with client-partners (60.68%). These factors highlighted the importance of intensive consultations with
client-partners from planning to monitoring and evaluation as well as the benefits from consensus-
building and collegial decision-making.

8.13 Rated “satisfactory” was the formulation of procedures with maximum inputs from the client-
partners, which was practiced by 58.12 percent of the respondent-organizations. One interpretation of the

49
data from the results, is that participatory approach of LGU client partners happens as a consequence of
the sector-specific interventions they implement with partners LGUs and not necessarily in direct relation
to LFPM.

Table 17. Percentage Scores on Participatory Approach

Participatory Approach Verbal Extent of Rank

% Interpretation Contribution
Are your policies on program operations Very
determined with your LGU client-partners? 64.1 Satisfactory Large Extent 2.5
Are your procedures carefully formulated Moderate
with maximum inputs from the LGU client- 58.12 Satisfactory Extent 5
partners?
Do you involve the LGU clients in the Very
identification and prioritization of focus of 67.52 Satisfactory Large Extent 1
support?
Do you conduct regular meetings and Very
consultations with the LGU client-partners? 60.68 Satisfactory Large Extent 4
Do you involve the LGU clients in the Very
monitoring of the status of your support? 64.10 Satisfactory Large Extent 2.5
Very
Total 62.91 Satisfactory Large Extent

Legend: 0-19.99 (Poor/Not all); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-79.99
(Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

Financial Accountability

8.14 More than half (57.09%) of the respondent organizations valued the principle of financial
accountability and had in place the necessary mechanisms (Table 18). This reflected a “satisfactory”
adherence to this principle of good governance. Three aspects of financial accountability with “very
satisfactory” measures in place were: implementing management practices resulting in the best possible
value from public funds (66.67%); giving financial management advice to LGUs (61.54%); and requiring
LGUs to formally account for any financial obligation (60.68%).

8.15 Two “satisfactory” aspects of financial accountability were knowing how well the LGUs perform
financial management responsibilities (50.43%); and providing measures to mitigate risks of theft, fraud,
or misuse of funds or properties (46.15%). These results show the general improvements needed by the
LGUs in LFPM—the need for competency-based standards by which to assess performance of the local
finance committee and the need for enhancement of managerial control systems of the LGUs. The conflict
arises in the execution of the accounting and internal control systems as performed by one functionary in
the person of the accountant.

Financial Transparency

50
8.16 Together with accountability, transparency in financial operations is also of paramount
importance in managing organizations. Financial transparency was observed by 57.78 percent of the
organizations surveyed, indicating a “satisfactory” situation in managing their financial affairs (Table 19).
This factor influenced to a “moderate extent” the outcome of initiatives among organizations providing
assistance to LGUs.

8.17 Two aspects of financial transparency that were rated “very satisfactory” by the respondents were
clear communication of financial management roles, objectives, and policies (64.10%); and tracking
financial status in the entire duration of support (61.54%).

8.18 The aspects that were rated “satisfactory” were generation of financial information that is easily
combined with operational data for managing the LGU (56.41%); provision of updated information on
financial status to the LGU client-partners (55.56%); and use of information technology to improve the
efficiency of managing the LGUs’ financial resources (51.28%).

Table 18. Percentage Scores on Financial Accountability

Financial Accountability Verbal Extent of Rank

% Interpretation Contribution
Do your management practices result in Very
getting the best possible value from public 66.67 Satisfactory Large Extent 1
funds?
Do you require the LGU to formally
account for any financial obligations Very
through management contracts, 60.68 Satisfactory Large Extent 3
accountability accord or similar
managerial agreements?
Do you give financial management advice Very
that helps the LGU make better 61.54 Satisfactory Large Extent 2
decisions?
Do you know how well the LGU is doing Moderate 4
in financial management responsibilities? 50.43 Satisfactory Extent
Do you have provisions in case of theft, Moderate
fraud or misuse of funds or property on 46.15 Satisfactory Extent 5
the part of the LGU?
Moderate
Total 57.09 Satisfactory Extent
Legend: 0-19.99 (Poor/Not all); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-79.99
(Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

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 Table 19. Percentage Scores on Financial Transparency

Financial Transparency Verbal Extent of Rank

% Interpretation Contribution
Do you clearly communicate financial Very
management roles, objectives and policies 64.1 Satisfactory Large Extent 1
as they apply to the LGU?
Do you generate financial information Moderate
that is easily combined with operational 56.41 Satisfactory Extent 3
data for use in managing the LGU?
Do you make use of information Moderate
technology for improving the efficiency 51.28 Satisfactory Extent 5
in managing the LGU’s financial
resources?
Do you provide updated information on Moderate
financial status to the LGU client- 55.56 Satisfactory Extent 4
partners?
Are there mechanisms to track financial Very
status during the entire duration of your 61.54 Satisfactory Large Extent 2
support?
Moderate
Total 57.78 Satisfactory Extent

Legend: 0-19.99 (Poor/Not all); 20-39.99 (Fair/Small Extent); 40-59.99 (Satisfactory/Moderate Extent); 60-79.99
(Very Satisfactory/Large Extent): 80-100 (Excellent/Great Deal)

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9. DESCRIPTION OF CONSTRAINTS IN LFPM ASSISTANCE

9.1 This section of the report discusses the common areas of confusion and difficulties faced by
institutions in providing LFPM assistance. It also reports on the least provided assistance by institutions
to LGUs.

Common Areas of Confusion

9.2 The three groups of respondents identified certain issues, gaps, and areas of confusion that were
common to them, such as: (a) dependency of LGUs in financial assistance from other entities like NGAs
and NGOs; (b) lack of awareness or appreciation of LGUs on the value of counter-parting; (c) risks
involved in the change of local administration; and (d) effects of some cultural practices in the
management of funds.

9.3 Dependence of LGUs on financial assistance was evident when they became partners of other
entities. There was always an expectation that funds will flow to the local government and this influenced
the extent of cooperation and participation of the local officials. Aside from the IRA coming from the
national government, LGUs also expected funds as components of projects and fund releases from
congressmen and senators. Indeed, the LGUs’ degree of dependency increased over time instead of
lessening as they should have developed their own ways of raising funds.

9.4 LGUs were also hesitant and very slow in providing counterparts (e.g., cash, materials, labor,
space) for projects which indicated their lack for regard on the concept of counter-parting and reflected
their dole-out mentality. This fact was emphasized by NGOs and GFIs that provided credit facilities for
LGUs that were supposed to have their own equity.

9.5 Changes in administration also modified the focus of local governance and shifted priorities in
programs and projects. The risk was high when the administration changed at the height of
implementation of a program or project, which in turn resulted to a high degree of uncertainty among the
implementors and beneficiaries. New officials generally had other agenda that were different from those
included in previously approved plans resulting in a wide range of inconsistencies.

9.6 Both the NGAs and the LGUs cited certain cultural practices that impinged upon the management
of finances of the LGUs as an area of confusion. The uniqueness of the Maranao culture was cited as an
example.

9.7 Other gaps which the Group 1 respondents identified were the need for a clearer definition and
requirements of real participation of local communities in the affairs of local governance especially in
resource allocation; lack of capacity of LGUs to reform or update the local tax systems, including the
local tax code; absence of post-training follow up or feedback mechanisms; difficulty of conducting
computer-based training because of lack of computers among LGUs; and overlaps on certain functions of
the DILG and DOF.

9.8 Among NGAs and GOCCs, the gaps included lack of competence of LGUs in debt management
and enterprise development and management; and lack of complementation of programs and areas of
jurisdiction among those providing support to local governments.

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9.9 LGU respondents identified the high degree of politicking in the management of financial affairs
among themselves as an issue. For instance, funding of barangay projects by the cities was a matter of
political affiliation of the barangay chair with the city officials. Political misunderstanding among leaders
also adversely affected financial management. There was too much informality in managing finances
when political relationship was given importance. Furthermore, the cities and municipalities expressed
concerns about barangay officials who were confined in the sphere of politics in running the affairs of the
government.

9.10 LGUs also regarded different interpretations of national policies and executive issuances by the
officials of national agencies as an area of confusion. This was particularly true in the case of the COA
where auditors differed in the interpretation of rules and in the conduct of audit. There were situations
when certain practices were allowed by some auditors but disallowed by another auditor of the same state
auditing body.

Difficulties

9.11 The respondents were asked to assess eight factors that can hinder their delivery of services and
thus become a problem to them. Two of the factors were determined to be constraints: (a) funding
limitations; and (b) scarcity of individual competence in the organizations.

9.12 Funding Limitations. There were varying perceptions about the adequacy, availability, and
provision of financial resources in the respective organizations surveyed (Table 20). Majority (52.87%)
considered funding as a constraint in terms of adequacy (64.29%) and availability (63.75%). However,
67.12 percent of the respondents revealed that their organizations used their financial resources for the
purposes for which these were allotted. Whether a relationship exists between the purpose for which the
funds are allocated and the adequacy of these funds to generate the expected outputs is yet to be
determined.

9.13 A large percentage of the respondents were also worried about the use of funds for the intended
purpose (32.88%) and about provisions for future financial requirements (48.05%). These figures should
be considered because these imply that many of the respondent organizations assessed such funding
limitations to possible affect their service delivery in LFPM support.

Table 20. Assessment of Funding Limitations

Funding Limitations YES NO

Freq. % Freq. %
Financial resources are adequate to meet current objectives
in the field of LFPM. 30 35.71 54 64.29
Financial resources are immediately available when
needed. 29 36.25 51 63.75
There are provisions for future financial requirements in
LFPM. 40 51.95 37 48.05
Financial resources are used for the purpose for which they
were allotted. 49 67.12 24 32.88

Total 148 47.13 166 52.87

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9.14 Scarcity of Individual Competence. Over half of the respondents (51.05%) believed that there
was a scarcity of knowledge, competence and skills among suppliers and users of support (Table 21).
Generally, there was a shortage of knowledge and skills among people in the organization providing the
support (60.49%) and those in the LGUs who were receiving the support (70.59%). However, there was a
general belief that there was competency development of both the support providers (66.67%) and the
LGU beneficiaries (60.24%). This development support was integrated as a major component in the total
support package.

Table 21. Scarcity of Individual Competence

Individual Competence YES NO

Freq. % Freq. %
There is scarcity of knowledge or skills among people in the
organization that constrain the management of support in the
area of LFPM. 49 60.49 32 39.51
There is absence or lack of technical knowledge among
LGUs in areas related to the provision of support. 60 70.59 25 29.41
There is lack of competency development for the staff in the
organization. 28 33.33 56 66.67
There is lack of competency development for the staff of
client LGUs in areas related to the support provided. 33 39.76 50 60.24

Total 170 51.05 163 48.95

Not Difficulties

9.15 Six other factors that were not assessed as constraints by the respondents were the following: (a)
linkaging activities; (b) information dissemination; (c) interest of LGU officials; (d) political interference;
(e) policy conflict; and (f) geographical dispersion of LGU beneficiaries.

9.16 Linkaging Activities. All aspects of linkaging activities were rated positively by 68.90 percent
of the respondents which means these were not considered as problems or constraints in the provision of
support (Table 22). There were efforts for linkaging activities initiated by organizations (80%) and these
were properly undertaken (77.65%). Linkages were also embedded in the long-term plan of the
organization (71.76%). Because there was support for linkages, there was also freedom to engage in
linkaging activities that provided mutual benefits (55%).

9.17 Information Dissemination. Majority (71.39%) of the respondents believed that all aspects of
information dissemination were properly attended to by their respective organizations (Table 23). It was
generally believed that there were effectives means of information dissemination in bringing the message
across (78.48%) and information was properly disseminated to the target audience (72.29%). Adequate
and effective mechanisms or systems were also in place as believed by 67.90 percent of the respondents,
thus creating a wider reach of the target audience as perceived by 67.07 percent of the respondents.

9.18 Information dissemination was important in developing broad support for local finance programs.
There must be an effective process through which information is imparted to the stakeholders to increase
their awareness, understanding, and appreciation of local finance support programs.

55
 Table 22. Assessment of Linkaging Activities

Linkaging Activities YES NO

Freq. % Freq. %
There are efforts for linkaging activities that are initiated in
the organization. 68 80.00 17 20.00
Linkages are embedded in the long-term plan of the
organization. 61 71.76 24 28.24
Linkages with various entities are properly undertaken when
necessary. 66 77.65 19 22.35
Linkaging activities are provided with adequate support. 49 59.04 34 40.96
There is freedom to engage in linkages that provide mutual
benefits. 44 55.00 36 45.00

Total 288 68.90 130 31.10

Table 23. Assessment of Information Dissemination

Information Dissemination YES NO

Freq. % Freq. %
Information regarding the support is properly disseminated
to target audience. 60 72.29 23 27.71
There are adequate mechanisms or systems of information
dissemination. 55 67.90 26 32.10
The means of information dissemination are effective in
bringing about the message. 62 78.48 17 21.52
There is adequate reach of the target audience in the area of
information dissemination. 55 67.07 27 32.93

Total 232 71.39 93 28.61

9.19 Interest of Local Officials. Majority (76.36%) of the respondents believed that local officials
were interested in LFPM support (Table 24). They were genuinely interested in availing of the support
(79.55%), have openly signified their interest (79.27%), and were willing to undergo the whole process
(79.01%) of availing the support. A great percentage (67.09%) of the respondents believed that LFPM
was the primary interest of local officials.

9.20 Political Interference. Political interference, while existing in most organizations, was not a
constraint as revealed by 60.46 percent of the organizations surveyed (Table 25). Coordinating with
political personalities was not deemed to be detrimental in the accomplishment of organizational
objectives by 66.67 percent of the respondents. A large proportion of the respondents also did not find
the organization’s mandates to be influenced by the political affiliation of its leaders (63.64%) and the
accomplishment of tasks was also not affected by political interference (59.77%). Further, over half

56
(51.72%) of the respondents said that they did not encounter interference from political figures or
personalities.

Table 24. Assessment of Interest of Local Officials

Interest of Local Officials YES NO

Freq. % Freq. %
Local government officials are genuinely interested in
availing the support provided by the organization. 70 79.55 18 20.45
LFPM is the primary interest of LGU officials. 53 67.09 26 32.91
LGU officials openly signify their interest to avail of the
support provided by the organization. 65 79.27 17 20.73
LGU officials are willing to undergo the whole process of
availing the support. 64 79.01 17 20.99

Total 252 76.36 78 23.64

Table 25. Assessment of Political Interference

Political Interference YES NO

Freq. % Freq. %
Mandates are influenced by certain political affiliation. 32 36.36 56 63.64
Interference from political figures or personalities is
encountered. 42 48.28 45 51.72
Coordinating with political personalities other than the LGU
official was found detrimental to the accomplishment of
objectives. 29 33.33 58 66.67
Accomplishments of tasks has been affected by political
interference. 35 40.23 52 59.77

Total 138 39.54 211 60.46

9.21 Policy Conflict. Policy conflict was generally viewed to exist but not to the extent of becoming a
constraint, as revealed by 63.60 percent of the respondents (Table 26). Majority (70%) of the respondents
did not encounter conflicts in their organizational policies that affected their work performance and 69.74
percent said that there were national policies that conflicted with their support for LFPM. Many of the
respondents (61.25%) also saw no conflicts in operating policies that affect their activities. However, half
of the respondents believed that conflicts in policies remained unclarified while another half said these
conflicts were clarified.

9.22 Geographical Dispersion of LGU Beneficiaries. While some support providers (54.02%)
preferred to support certain LGUs in a geographic area, geographic dispersion was not considered to be a
problem by 57.14 percent of the respondents. Concerned donors considered geographic preference as a
way to balance development. Despite limitations in infrastructure and logistics, more than half of support

57
providers (51.85%) did not encounter problems on having widely dispersed clients. Further, many
respondents (58.54%) believed that geographic dispersion of LGU clients did not adversely affect their
service delivery.

Table 26. Assessment of Policy Conflict

Policy Conflict YES NO

Freq. % Freq. %
There are national policies in conflict with the rendition of
support in the field of LFPM. 23 30.26 53 69.74
Conflicts in the organizational policies that affect the
performance of the work are encountered. 24 30.00 56 70.00
There are conflicts in operating policies that affect the
activities. 31 38.75 49 61.25
Conflicts in policies remain unclarified. 29 50.00 29 50.00

Total 107 36.40 187 63.60

Table 27. Assessment of Geographical Dispersion of LGU Beneficiaries

Geographical Dispersion of LGU Beneficiaries YES NO

Freq. % Freq. %
There is geographic preference in the selection of client 47 54.02 40 45.98
LGUs.
Geographical dispersion among LGU clients is considered 36 42.86 48 57.14
as a problem.
Geographical dispersion of LGU clients adversely affect the 34 41.46 48 58.54
delivery of the service.
LGU clients encounter problems with geographic location 39 48.15 42 51.85
insofar as support is concerned.
156 46.71 178 53.29
Total

10. GAPS AND OVERLAPS IN LFPM

This section identifies the gaps and overlaps and the services least provided in LFPM.

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Mismatch of LFPM Assistance with Current Demands in Local Governments

10.1 The mismatch of LFPM assistance has been observed in four aspects: (a) concentration of
support on certain areas of LFPM; (b) capacity building focus versus current needs of local officials; (c)
concentration of support in larger LGUs; and (d) provision of sector-specific interventions.

10.2 The survey showed that the assistance to LGUs was concentrated on certain areas such as the
traditional revenue generation, local development planning, and local enterprise development. Such
concentration also reflects that services in certain areas are least provided. Table 28 summarizes the
specific areas where institutions provided least assistance to LGUs. These were as follows: (a) alternative
sourcing of income through innovative means and investment management for revenue generation; (b)
expenditure management for accounting; (c) research studies that will enhance the supply capacities to
fulfill the demands of constituents for budgeting; (d) compliance to managerial control systems and
research studies for internal auditing; and (e) implementation of the newly enacted procurement acts. The
awards systems benchmarking the LGUs’ effective practices covering important areas of LFPM was also
inadequate.

Table 28. Least Provided LFPM Assistance

Areas of LFPM Specific Concerns

1. Revenue Generation • Bonds
• BOT Mechanisms
• Sourcing of Credit/Financing
• Investment Management
2.Accounting • Expenditure Management
• Award System
3.Budgeting • Research Studies
• Award System
4.Internal Auditing • Managerial Control Systems
• Research Studies
• Award System
5. Procurement • New Procurement Law
• Award System

10.3 Almost all the institutions were clearly engaged in capacity building in LFPM. However,
majority of the assistance provided did not match the current demands of LGUs specifically in the
provision of trainings on alternative revenue generation strategies, local debt borrowing, expenditure
management, and procurement process. Further, it was not clear if the capacity building programs
provided in LFPM had standards corresponding to the public sector. Given the multitude of trainings that
the LGUs have to undergo for other sector-specific concerns, there was a greater need for capacity
building and institutional provisions to provide the needed assistance in LFPM. So far, there have been no
efforts made to establish standards of both individual and institutional competencies in LFPM.

10.4 The assistance in LFPM was concentrated in the larger LGUs. On the contrary, municipalities
were in greater need of more LFPM assistance than the cities and provinces. Institutional constraints such
as asymmetric information, ease of direct borrowing instead of alternative sourcing like bonds, and heavy

59
documentations and dealings with investors are forcing small municipalities to depend on IRA and other
grant and credit financing from the government.

10.5 LFPM assistance has become a consequence of other sector-specific development interventions
rather than a direct assistance intervention of institutions. As a result, the focus of intervention has been
geared toward the development of certain sectors and not on the fundamental requirements and significant
components of local finance. Consequently, the sustainability of practices in financial management has
not been ensured. While the responsibilities of the local finance members have been embedded in the
LGC, there is a need to strengthen the generation of funds other than simply the recording and
documentation of grants receipts and the facilitation of credit financing.

Competing or Conflicting Roles of Government Institutions

10.6 Following the principle of decentralization, the national agencies should provide a catalytic role
in the LGUs effective and sustainable management of fiscal and financial resources. Hence, it is of
utmost importance to determine (a) the LFPM roles that LGUs have to play under decentralized modes of
operation, and (b) the NGAs roles to meet the decentralized modes of operation. While the BLGF is the
DOF’s arm that is directly responsible over the fiscal and financial affairs of local government, there
exists still a MDFO, also under the DOF, which is the fund conduit of foreign-assisted projects. On the
other hand, the DILG through the Bureau of Local Government and Development (BLGF), also has a
Local Fiscal and Resource Development Division.

10.7 The management functions of these three offices needs to be clarified. Each office is supposedly
a policy and regulatory body that will assist local government in revenue administration and fund
management. The LGUs, however, are now beginning to feel an important gap in harmonizing LFPM
especially in their perception of their mandates, thus creating confusion especially among small
municipalities. The issue is what mechanisms have been established to coordinate LFPM activities among
levels of national governments and how effective are these mechanisms. While the LGUs are well versed
in the provisions of the LGC of 1991, the “how-to” aspects of revenue generation and fiscal
accountabilities have not been detailed in the assistance provided. In effect, LGUs have created new
mechanisms to circumvent complying with rules and regulations on revenue generation and fiscal
accountabilities.

10.8 A case in point was the emergence of the IRA intercept in the MDFO as a result of minimum
compliance to reporting among LGUs. Another inconsistency was in the promotion of projects on tax
systems. For instance, the BLGF assisted LGUs in developing and implementing RPTA projects. At the
same time, the National Tax Research Center also promoted a tax system that ensured a fair distribution
of the tax burden among the Filipino taxpayers. International donors are also beginning to see the need to
improve harmonization. The ADB TA on Local Institutional Strengthening of Budgeting and Planning
focuses on the BLGF as the target institution for enhancement.

Weak Coordination Among NGOS to Consolidate and Direct their Assistance to LGUS

10.9 Certain NGOs like the ASF and the JFLFI have expressed that they were not aware of any other
organization that support LGUs on financial planning and management. This raises a question of how
aware they really are of other organizations performing similar functions that may overlap with theirs.
While Table 29 shows a relatively lower percentage of NGOs that expressed the existence of gaps and
overlaps, the fact remains that many affairs of the NGOs are not properly coordinated.

60
10.10 Results showed that although the NGO respondents had existing operational networks, they still
had limited knowledge about their networks’ operations. This leads to a need for some level of
coordination among the NGOs to consolidate and direct their efforts in development. Experiences have
shown that NGOs tended to participate through their networks, allowing them to engage in a full range of
simultaneous functions. NGO networks are of two basic types: (a) associations (having formal
relationships), and (b) coalitions built around common issues or agenda. Although networks are set up for
different concerns, activities tend to be similar – mutual support, resources and expertise sharing, joint
advocacy, lobbying and negotiations, and information sharing. With the respondents’ conflicting answers
and limited knowledge on the operations of similar organizations, the organizations may not really know
about the gaps and overlaps as well as the assistance that they provide. Hence, thee may be instances
when they cannot or do not act upon certain problems or issues.

Table 29. Gaps And Overlaps In LFPM Assistance

HEIs & NGOs NGAs LGUs

RESPONSE (N=33) (N=20) (N=52)
No. % No. % No. %
Yes 9 27.27 2 10.00 20 38.46
No 24 72.73 18 90.00 31 59.62
NAP/No response 0 0.00 0 0.00 1 1.92
Total 33 100.00 20 100.00 52 100.00

Loose Internal LGU Financial Management

10.11 There was apparent looseness in the internal management of the LGUs’ financial resources. First,
there was an apparent gap in the coordination of local financial management. In a corporate structure,
there is a Controller or a Chief Finance Officer who integrates and coordinates functional departments
doing financial tasks. In LGUs, the three members of the local finance committee together with the local
accountant comprised the local finance departments. Each has separate functions but nobody coordinates
and integrates the many activities and information for efficient and effective management. The local
administrator who is expected to oversee all the departments is tied up with other functions, thus local
financial management is usually left to the head of each separate local finance department. Indeed, the
span of control of the local chief executive and local administrator is so wide that other functions have to
be sacrificed.

10.12 Second, the mandate for LGUs to create an internal audit department separate from accounting is
problematic because of the conflict with the LGC’s provisions that internal audit is a function of the local
accountant. Internal auditing is gaining more and more recognition as an important tool for improving
organizational performance. In many countries, both public and private sectors advance internal audit as a
profession, process, and body of knowledge. The Philippines is one such country having put in place the
policy framework mainstreaming internal audit in government operations. However, at the local level,
confusion has emerged among the LGUs as a result of conflicting policy pronouncements by the national
government (Mendoza and Javier, 2006). The Office of the President issued Memorandum Circular No.

61
89 1 reiterating strict compliance of all government agencies to AO No. 70 and Budget Circular No. 2004-
4. However, full compliance to these policies, particularly at the local level, seems a formidable challenge
for LGUs since these are inconsistent with the LGC of 1991, which states that the accountant in a LGU
“shall take charge of both the accounting and internal audit services of the LGU concerned.”

10.13 Third, there were observed internal-external audit overlaps in local government. The demarcation
line that divided the functions of internal auditing from external auditing was unclear. For instance, while
COA, being the external auditor, has mandates to audit the revenue cycle in LGUs, it cannot (because of
manpower limitations) and does not examine every transaction. On the other hand, the current practice of
internal audit in LGUs does not cover revenue audit. As a result, a large number of revenue-generating
and collecting activities remain unchecked especially in field operations (e.g. public market where fees
are collected). Thus, the complementary roles of internal and external auditing can actually create
overlaps that lead into a situation where certain auditable activities remain unchecked.

10.14 Furthermore, the current practice among LGUs disregards the audit of revenue-generating
departments. Examination of accounts focused on the expenditure side. While the local administration is
bent on generating revenues, it also has to look into the lost revenue as a result of the lack of mechanisms
for audit or examination. Indeed, government money is also lost because of the failure to audit revenue-
generating units in the LGUs, particularly the collecting officers. There are a number of instances when
money is reported to have been lost even before it reaches the government’s coffer.

10.15 Fourth, the often-neglected aspect of expenditure management is capital expenditure budgeting.
LGUs generally incur two types of expenditures: the revenue expenditures and capital expenditures.
Revenue expenditures are those that are charged directly as expense against the revenue at the time the
expenditure is incurred. Maintenance and operating expenses and personal services are revenue
expenditures. On the other hand, capital expenditures are those that provide long-term benefits and
therefore should be expensed over a number of periods. It has been the practice of most LGUs to include
the details of the revenue expenditures in the annual budget adhering to the concept of transparency and
full disclosure. However, capital expenditures are usually presented in lump sum amount and without the
benefit of a cost-benefit (or more technically called capital expenditure) analysis. As a result, many
capital expenditures do not provide the necessary value in spite of the material amount of investment.
Thus, the concept of capital expenditure budgeting should be enhanced in the LGUs as a mandate of the
local budget officer.

10.16 Finally, fiscal autonomy in expenditure management especially under the LCE’s discretion of
spending for development plans has a wide range of implications to good local governance. Without
major sourcing of revenues, the LGUs are encouraged to circumvent the imposition of a cap on the
personal services expenditures in the IRA. Contract employment chargeable against operating expenses
(Ursal, 2005) is commonplace. In a sense, local expenditures and budget management become politically
expedient rather than instruments for creating and distributing wealth.

IRA-Related Issues

10.17 While the corporate functioning of local governments through revenue generation is left behind,
the IRA is a hotly contested issue in local circles. While the IRA is a LGU share, there is a tendency to

62
treat it as revenue itself. Such tendency discourages further generation of additional revenues for the
LGU to fulfill its function as a corporate entity as mandated in the LGC.

10.18 The other issue related to IRA is the fiscal risk that the LGU experiences vis-à-vis the tenure of
the LCE. Most credit and loans of LGUs are considered long-term local debts usually financed through
the IRA. These can create fiscal risks that should be considered as an LFPM growth area of assistance.
Again, credit financing to fund operational and developmental interventions creates long-term risks for
both the LGU and the national government, as it can be a contingent liability similar to the GOCCs’
heavy borrowing with the national government as guarantor. The slow evolution over the last decade of
local financing creates vulnerability of the local government that is very conducive to excessive political
maneuverings. Thus, monitoring and inventory of local debts/borrowings movements is deemed a
priority.

10.19 It has now become too obvious that the current efforts, assistance, and initiatives are not
sufficient to meet the growing demands for revenue sourcing at the LGU level. The IRA’s current
formula especially in its allocative efficiency by governance tiers must be re-analyzed.

Grey Areas in Local Development Planning

10.20 The study showed that respondent organizations assisted in local development planning. How
LGUs conducted local development planning, however, is the question. Local development plans
appeared elegant and compliant with the requirements of people participation. However, the respondents
revealed that some of the LGUs consulted people only at some point in the planning process—usually
when plans were almost complete. Others also observed the total disregard of local officials for popular
consultations. What indeed is people participation in the planning process remains a grey area that should
be clarified, defined, and operationalized.

10.21 LGUs expressed confusion on the preparation of the Comprehensive Land Use Plan and the
Comprehensive Development Plan, hence, their failure to comply with these mandates. As a result, most
of those who were able to meet the requirements have sought the assistance of external consultants with
the local officials providing only the inputs and the directions. The actual process of planning has not
been felt by the people. One grey area that complicates this matter is the large number of plans that
should be prepared for the various sectors as mandated by several government agencies. For instance, on
matters of comprehensive land use and comprehensive development plan, three agencies are involved:
the NEDA, Housing Land and Use Regulatory Board, and the DILG. Since the local development
officers prepare numerous sectoral plans that differ in principles, format, and requirements there is a need
to simplify and harmonize the local planning framework. The OCOV project of the DILG together with
the House of Representatives leads to the right direction.

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11. SUMMARY OF FINDINGS

11.1 The principal findings of this study were as follows: (a) LFPM institutional assistance at the local
level was limited; (b) NGAs and IFIs were directly providing all three forms of LFPM assistance while
academic institutions, NGOs, and to a certain extent the LGUs, focused on technical assistance; and (c)
LFPM assistance provided LCEs with the major responsibility that local government fiscal performance
is related with managerial enhancement.

Limited LFPM Institutional Assistance at the Local Level

11.2 Assistance to LGUs in LFPM was limited to capacity building and policy support. In terms of
areas, the assistance was limited to traditional revenue sourcing and local development planning. The
LGU respondents have expressed needs not provided by the current institutional support systems. This
was specially manifested in alternative sourcing of revenues, managerial control systems, procurement
processes, and local economic enterprises that harness inter-local cooperation other than credit sourcing.

Role Differentiation Not Meeting Current Needs

11.3 NGAs and IFIs were directly providing all three forms of LFPM assistance. Academic
institutions, NGOs, and to a certain extent the LGUs, were focused on technical assistance (i.e., capacity
building). While this may be considered as role differentiation, current LFPM supply did not exactly
meet current demands. Capacity building has often focused on training and participatory workshops for
LGU officials. With the rapid turnover of elective and appointive officials, however, a vacuum was
created as key experienced staff (who have been trained) were replaced/dislodged. There were many staff
who needed capacity building in LFPM. Right now, the LGUs are highly dependent on the IRA, donor
assistance, and government-sourced credit financing and national grants because these are the most
convenient ways of accessing funds for development or operational purposes. Academic institutions and
NGOs can redirect their focus on these capacity building needs of LGUs. There is a compelling need to
evolve organizational competencies as well as individual competencies for LFPM at this point to ensure
effective LGU functioning.

Fiscal Performance and Managerial Enhancement

11.4 LFPM assistance provided LCEs with the major responsibility that local government fiscal
performance is related with managerial enhancement. The LFPM assistance of various institutions to
LGUs has provided wider responsibilities for local executives. In general, LFPM assistance has improved
understanding of transparency and accountability and organizational efficiency. However, it has not
increased local public investments. This situation highlights the need for a hand-in-hand
development/evolution of both political and corporate functioning of LCEs as a mandate of the LGC of
1991.

11.5 Figure 3 summarizes the LFPM assistance in Philippine local governments.

64
 A. Financial Assistance
International Institutions
Direct financing
Lending
Credit
International Institutions Capacity building
NGAs NGAs
Acad Regulation
NGOs Fund conduit
Project Management
LGUs B. Technical Assistance
Academic Institutions
Capacity building
Deployment of experts
NGOs
Capacity building
Mobilization

LGUs
Inter-LGU cooperation
Contributions/Donations

C. Policy Assistance
NGAs
Regulation
Policy environment
NGOs
Capacity building

Figure 3. LFPM Assistance Map

65
11.6 Lessons for the Future. The study came up with the following lessons for the future: (1)
matching of assistance with current demands; (2) harmonization of functions among government
institutions; (3) enhancing the functioning of networks; and (4) strengthening the internal financial
management of LGUs.

Matching of Assistance with Current Demands

11.7 On the issue of concentration of support on certain areas of LFPM, it is necessary to disperse the
effort in other innovative assistance and to demand-driven areas in order to broaden the financial
performance impacts. Assistance in revenue generation as an LGU priority and enhancement of
individual competencies of the local finance committee is wanting.

11.8 On the issue of capability building focus versus the needs of local officials, there is a need to
make an inventory of NGO-led / academe-led capacity building programs and to customize these based
on the competencies needed by LGUs. First, competency standards should be developed initially for
officials and employees belonging to the Local Finance Committee. Clearly, there is a need to ascertain
the standards of LFPM competencies, including modalities of content delivery, among the local finance
committees. Many of the local finance committee members have acquired their competencies either
through on-the-job experience, trainings, and various career development programs and paths.
Developing a competency-based education, training, assessment and accreditation (CBETA) similar to
the Career Executive Service Official (CESO) model of the Civil Service Commission is a step in the
right direction. Together with representatives of professional organizations binding the local finance
committee like the Philippine Institute of Certified Public Accountants (PICPA) and the Association of
Government Internal Auditors (AGIA) for accountants, the Philippine Association for Government
Budget Administrators (PAGBA) for budget officers, the Philippine Association of Local Assessors and
Treasurers for local treasurers, and the League of Planning and Development Coordinators of the
Philippines for planning and development coordinators, these stakeholders plus local finance experts,
representatives from the academe, the CSC and EPRA can be assembled to develop a system of LFPM
competencies and government accreditation. Further, the local finance committee by the nature of their
jobs can not be away for long periods of time for continuing education and training. Considering the
geographical distances among potential trainees and the huge amount required for training, there is a need
for alternative learning modalities.

11.9 A possible course of action in this area is ascertaining the standards of LFPM competencies
among the local finance committees. So far, none of the institutions in the Philippines have done this.
This can be a future research agenda or theme. These standards should be the basis of conducting future
trainings and seminars. Thus, the trend should be to use the “Competency-Based Education and
Training” in LFPM, not the traditional type of training modalities.

11.10 Programs of academic institutions offering degree programs in local governance must be
assessed. The interest of an increasing number of academic institutions in local governance as a degree
program reveals the need to put in place the necessary oversight on the part of the national government.
Thus, an ad-hoc consultative inter-agency body to look into the quality of program offerings including
the issue of responsiveness to market needs and adherence to the principles of good governance may be
created and recommended to the Commission on Higher Education (CHED). Towards this end, a more
comprehensive framework shown below is proposed.

66
 INTER-AGENCY
CONDUCT
CONSULTATIVE
STUDY
BODY
Identify and PROPOSE PRESCRIBE
Create a body to
establish FRAMEWORK RULES AND
look into the
competency AND MONITORING
current situation
standards in local DEVELOP SYSTEM
of education in the
governance MODELS
area of local
education
governance
(including local
financial
management)

Figure 4. Competency-Based Education Framework for Oversight Function in Academic

Institutions

11.11 To resolve the issue of concentration of support for larger LGUs, the provision of support should
be refocused where there is a greater need—in the municipalities. The LFPM component of local
economic development and investments management and other revenue generation mechanisms are the
currently expressed needs of LGUs. However, majority of the institutions evidently built their assistance
on broad traditional scopes of revenue generation leaving out the innovative options. LFPM assistance
should be intensified specially in poor municipalities.

11.12 As for sector-specific interventions, a very desirable strategy is to design an LFPM enhancement
program that will harness a broad range of multi-stakeholders and institutions to build a consolidated
LFPM capacity for local finance managers. Such a strategy will build or develop a program for long-term
capacitation of LGUs in LFPM. Once a competency standard for LFPM has been established, design of
an EPRA-initiated common pool/basket of resources for an integrated LFPM capacity building and
delivery initiatives can be pursued. The programs of the BLGF, BLGD, MDFO, and other GFIs can also
be integrated for a standard LFPM capacity building program for the local finance committee. The most
important lesson learned is that LFPM should be a direct assistance intervention rather than the
consequence of other sector-specific development interventions.

Harmonization of Functions Among Government Institutions

11.13 Policies can be directed towards a more reform-oriented practice where fiscal performance is felt
by majority of the LGU clients and constituencies. Preventive policy measures starting from an inventory
of local debts and movements can be developed basically to avoid fiscal risks created by heavy
borrowings. Local debts or borrowings to finance operational projects are not sustainable in the long-
term. LGUs should be self-reliant with viable revenue generation programs. Local economic enterprise
development, while a major development agenda of the LGUs, is still the most pressing and urgent
concern even by the LGUs themselves.

67
11.14 A review of the delineation of functions between and among the following government offices,
BLGF, BLGD, and MDFO is recommended with maximization of resources as the objective of
assessment. Likewise, it is recommended that EPRA studies the idea of a common pool/basket of
resources in LFPM interventions among the GFIs for allocative efficiencies and scale of interventions. A
research team can undertake an assessment and recommend possible options for maximized financial and
human resource use. This will ensure harmonization of governmental assistance in LFPM. The effort of
IFIs to harmonize capacity building programs for LGUs is a good start.

Enhancing the Functioning of Networks

11.15 Networking can increasingly become a primary means and vehicle for NGOs to mainstream their
alternative approaches, to scale-up their activities, and to implement varying degrees of mutual
accountability and self-regulation. If these are realized and integrated in their operations, then their
members’ active involvement and commitment in follow-up actions as well as their complementation
rather than duplication of activities, are assured. An LFPM coordinative council or network that can
coordinate and consolidate the efforts of NGOs and influence government institutions for maximized
resource use and integration of LFPM assistance can be established. The council or network would play
an important role in scaling-up initiatives and in information dissemination that would identify gaps and
overlaps in the operation of various organizations. One major take-off activity for mobilization is the
procurement dialogue.

Strengthening the Internal Financial Management of LGUs

11.16 On addressing the gap in local financial management, it is proposed that the Chief Financial
Officer in an LGU should be determined first, and then to facilitate the legislative actions or executive
issuances necessary for the creation of the position. This is corollary to the corporate functioning of the
LGUs as mandated in the LGC.

11.17 There is a need to review/study possible amendments to the LGC of 1991, such as the inclusion
of accountants in the local finance committee in addition to the current membership of the local planning
and development officer, local budget officer, and local treasurer as provided in Sec. 316 of the LGC.
The functions of the accountant include the generation of financial reports which contain abundant
information that can be used in planning and decision-making.

11.18 Clarification should also be made on the inconsistencies of Administrative Order (AO) No. 70
issued by the President on April 14, 2003 and Budget Circular No. 2004-4 issued by the DBM on March
22, 2004. Both order all government offices, agencies, GOCCs, state universities and colleges, and LGUs
to organize an Internal Audit Service (IAS) in their respective offices vis-à-vis the LGC of 1991
specifically Article IV, Section 474, which states that the accountant “shall take charge of both the
accounting and internal audit services of the LGU concerned.”

11.19 The complementation of the internal audit being performed by the local employees and the
external audit conducted by the COA state auditors should be clarified. Executive issuances may be made
after delineating the scope of functions of each type of audit.

68
11.20 A system should be designed to provide capital expenditure budgeting equal importance as
operational budgeting. Capital expenditure evaluation techniques should be applied in incurring capital
expenditures.

11.21 The concept of responsibility accounting can very well fit in the issue of expenditure management
to provide effective controllership among LGUs. Responsibility accounting links authority and control.
Local department heads plan for their areas of responsibility and exert control over these plans by making
decisions and evaluating results. A responsibility accounting system brings discipline to planning and
control tasks.

11.22 The application of responsibility accounting in LGUs should lead to the adoption of an even more
useful system of activity-based accounting. An important objective of local government management is
to trace as many costs as possible directly to the activities that caused these to be incurred. The activity-
based accounting is vital to management’s objective of eliminating non-value added costs. There are
costs of activities that can be eliminated without deterioration in the quality of service delivery and LGU
performance.

11.23 The current trend is for the more capable LGUs to engage in computerized systems to assess and
collect real property and business taxes. Such trend signals the need for the national government to
establish some standards or models that can guide LGUs in determining the optimum cost of investment
and the desired components of the system.

11.24 The procurement process through the new Government Procurement Reform Act (GPRA), which
was approved in 2003, has many processes which cannot be supported by the resources of many low-
income LGUs. Foremost among these is the compulsory website posting of bid invitations, and accessing
of the government’s electronic procurement portal system. While this may ensure transparency for
government agencies like the LGUs, it has direct implications for suppliers. Many small- and medium-
scale suppliers of goods and services have expressed apprehension over the system as favoring big
corporations that corner most government contracts. Also, the cap on construction by the administration
constricts the LGU from further generating employment using local constituents for labor and equipment.
While this can be disadvantageous to the LGUs in the short-run, it may provide an opportune time to
devise ways for inter-local cooperation in procurement. Inter-local cooperation will not only ensure
transparency but also enable LGUs to get their money’s worth from legitimate and accredited suppliers.
Further, it will force the LGUs to use their development planning skills for procurement through the
annual procurement plan (APP). Recommended is the institutionalization of a procurement dialogue
through a national procurement summit to discuss the complexities of the GPRA and to harness inter-
local cooperation and simplification of the procurement process.

11.25 Table 30 shows some of the policy action arenas for EPRA.

69
 Table 30. Some Potential Policy Action Arenas for EPRA

Action Arenas Possible Partners EPRA Action

Classification
A. Matching of Assistance with LGU Demands

1. Disperse efforts in other innovative and demand-

driven areas of assistance.

2. Conduct inventory of NGO-led/academe-led ASG, UP, DAP,

capacity building programs. DLSU and selected
NGOs
a. Assess LFPM academic programs; LFPM
should be a direct assistance intervention rather
than the consequence of sector-specific
interventions.
b. Design and develop a long-term capacity Standard modular
building enhancement program in LFPM. intervention

3. Ascertain standards and competencies in LFPM PICPA, AGIA, Legislative Study

among the local finance committees through a PAGBA, BLGF, and/or CSC
competency-based education, training, assessment BLGD, CHED, Executive Issuance
and accreditation (CBETA). EPRA and selected
representatives of
academic institutions
B. Harmonization of Functions of Some
Government Agencies

1. Review delineation of management functions BLGF, MDFO, Creation of Ad-hoc

BLGD, DOF, ASG, harmonization
among the BLGF, MDFO, and BLGD; initiate a
EPRA and selected committee to study
common pool/basket of resources for integrated NGO and LGU GFI functions with
LFPM initiatives. representatives DOF as lead agency

C. Coordinative Mechanisms for NGO LFPM

Networking

1. Establish an LFPM network among NGOs engaged CREMDEC, IPD Mobilization and
establishment of a
in local governance; study establishment of a
formal network on
coordinative council on LFPM among NGOs. LFPM

D. Internal Financial Planning and Management

1. Study the designation of a Chief Financial Officer AGIA, COA, PICPA, Legislative actions
in LGUs. DBM, ASG
Publication on LGU
Internal Audit
2. Lobby for the inclusion of accountants in the Guidelines
membership of the local finance committee.

70
3. Lobby amendments to the LGC of 1991 vis-à-vis
A.O. No. 70.

4. Review functions of internal audit against COA

functions.
Publication on
5. Conduct study and determine usefulness of the Management
following management control system: capital Control Systems for
expenditure budgeting, responsibility accounting, LGUs
and activity-based costing.

6. Establish standards in the adoption of computerized

systems to serve as guides to local officials.
Mobilize GPRA
7. Institutionalize procurement dialogue through a
Dialogue
National LGU Procurement Summit.

E. IRA-Related Actions

1. Study and propose IRA reformulation measures. Selected NGOs and Legislative actions
academic institutions
and leagues of local
2. Conduct an inventory of local debts/borrowing
governments
movements of the LGUs.

3. Study and propose preventive measures to avoid

fiscal risks vis-à-vis LCE’s tenure.

F. Local Development Planning

1. Study, develop, and propose framework to DILG-RPS Project Consultations with

operationalize real people participation. Management Team local development
and EPRA planning
stakeholders
2. Study, develop, and propose framework for
harmonized and simplified local development
planning.

71
REFERENCES

Amatong, Juanita D. 2005. Local Government Fiscal and Financial Management, Best Practices. Manila,
Philippines: Department of Finance.

Asian Development Bank. 1999. Special Evaluation Study of the Role of Non-government Organizations
and Community-based Organizations in an ADB Project. Manila, Philippines: ADB.

Capuno, J. Joseph. 2002. Philippine Country Paper in Paul Smoke and Yun-Hwan Kim (Eds).
Intergovernmental Fiscal Transfers in Asia: Current Practice and Challenges for the Future. Manila,
Philippines: ADB.

Celestino, Alicia B., Norberto G. Malvar and Romulo R. Zipagan, Sr. 1998. Handbook of Local Fiscal
Administration in the Philippines. Manila, Philippines: Local Government Center, University of the
Philippines and German Foundation for International Development.

Commission on Audit. Manual on the New Government Accounting System. Manila, Philippines: COA.

Cuaresma, Jocelyn C. and Simeon A. Ilago. 1996. Local Fiscal Administration in the Philippines. Manila,
Philippines: Local Government Center, University of the Philippines and German Foundation for
International Development.

Department of Budget and Management. Local Government Budgeting Manual. Manila, Philippines:
DBM.

Gavino, Carlos B. 1998. LGU Financing: Present Sources, Availability and Terms. Manila, Philippines:
Coordinating Council of the Philippine Assistance Program, BOT Center.

Mendoza, Rufo R. and Aser B. Javier. 2006. State of Compliance and Implementation of National
Internal Audit Mandates by Local Government Units in the Philippines. Manila, Philippines:
Association of Internal Government Auditors.

Padilla, Perfecto L. 1998. Increasing the Financial Capacity of Local Governments in Strengthening
Local Government Administration and Accelerating Local Development. Manila, Philippines: Local
Government Center, University of the Philippines and The Asia Foundation.

Tan, Roberto, 2004. Global Trends in Financing Sub-National Government and Para-Statal Entities: The
Philippine Experience.

Ursal, Sofronio B. 2005. Government Procurement Reform Act: Local Challenges and Opportunities in
Klaus Preschle and Gaudioso C. Sosmeña. Local Government Issues and Policy Challenges. Manila,
Philippines: LOGODEF and Konrad Adenauer Stiftung.

Ursal, Sofronio B. 1992. Local Government Taxation. Manila, Philippines: Mary Jo Educational Supply.

72
APPENDIX TABLE 1. INVENTORY COUNT OF SUPPORT IN LFPM

1 2 3 4 5 6 7 8 9
Prog/Proj FinAss EquipFacil Award Policy Network Plan CapBuild Research Total
1 Revenue Generation
1 Real property taxation 27 20 11 10 39 33 26 43 21 230
2 Business permits and licenses 18 11 8 6 38 29 21 35 16 182
3 Build-operate-transfer scheme 4 3 3 2 10 3 3 10 8 46
4 Municipal bonds 3 1 0 0 6 1 3 5 7 26
Sub-total 52 35 22 18 93 66 53 93 52 484

2 Accounting
5 Financial accounting and reporting 18 11 9 4 25 18 20 50 17 172
6 Expenditure management 14 10 6 4 24 22 22 48 14 164
7 Assistance for the NGAs 8 8 4 6 19 14 15 38 12 124
Sub-total 40 29 19 14 68 54 57 136 43 460

3 8 Budgeting 18 16 7 6 24 19 26 46 13 175

4 9 Internal Auditing 9 6 5 3 21 12 13 32 9 110

5 Local Economic Development

10 Project feasibility studies 24 15 6 2 16 20 24 39 13 159
11 Local economic enterprise establishment 29 23 9 7 26 26 27 34 19 200
12 Project management and financing 25 24 6 5 17 21 30 46 16 190
13 Financial packaging 15 13 4 5 14 20 21 30 17 139
Sub-total 93 75 25 19 73 87 102 149 65 688

6 14 Local Development Planning 28 16 6 4 32 33 43 66 32 260

7 15 Procurement Process 16 9 7 4 25 15 24 45 8 153

GRAND TOTAL 256 186 91 68 336 286 318 567 222 2330
APPENDIX TABLE 2. INVENTORY OF SUPPORT (IN PERCENTAGE)

1 2 3 4 5 6 7 8 9
Prog/Proj FinAss EquipFacil Award Policy Network Plan CapBuild Research Total
1 Revenue Generation
1 Real property taxation 21.95 16.26 8.94 8.13 31.71 26.83 21.14 34.96 17.07 20.78
2 Business permits and licenses 14.63 8.94 6.50 4.88 30.89 23.58 17.07 28.46 13.01 16.44
3 Build-operate-transfer scheme 3.25 2.44 2.44 1.63 8.13 2.44 2.44 8.13 6.50 4.16
4 Municipal bonds 2.44 0.81 0.00 0.00 4.88 0.81 2.44 4.07 5.69 2.35
Sub-total 10.57 7.11 4.47 3.66 18.90 13.41 10.77 18.90 10.57 10.93

2 Accounting
5 Financial accounting and reporting 14.63 8.94 7.32 3.25 20.33 14.63 16.26 40.65 13.82 15.54
6 Expenditure management 11.38 8.13 4.88 3.25 19.51 17.89 17.89 39.02 11.38 14.81
7 Assistance for the NGAs 6.50 6.50 3.25 4.88 15.45 11.38 12.20 30.89 9.76 11.20
Sub-total 10.84 7.86 5.15 3.79 18.43 14.63 15.45 36.86 11.65 13.85

3 8 Budgeting 14.63 13.01 5.69 4.88 19.51 15.45 21.14 37.40 10.57 15.81

4 9 Internal Auditing 7.32 4.88 4.07 2.44 17.07 9.76 10.57 26.02 7.32 9.94

5 Local Economic Development

10 Project feasibility studies 19.51 12.20 4.88 1.63 13.01 16.26 19.51 31.71 10.57 14.36
11 Local economic enterprise establishment 23.58 18.70 7.32 5.69 21.14 21.14 21.95 27.64 15.45 18.07
12 Project management and financing 20.33 19.51 4.88 4.07 13.82 17.07 24.39 37.40 13.01 17.16
13 Financial packaging 12.20 10.57 3.25 4.07 11.38 16.26 17.07 24.39 13.82 12.56
Sub-total 18.90 15.24 5.08 3.86 14.84 17.68 20.73 30.28 13.21 15.54

6 14 Local Development Planning 22.76 13.01 4.88 3.25 26.02 26.83 34.96 53.66 26.02 23.49

7 15 Procurement Process 13.01 7.32 5.69 3.25 20.33 12.20 19.51 36.59 6.50 13.82

Grand Total 13.88 10.08 4.93 3.69 18.21 15.50 17.24 30.73 12.03 14.03

Legend:
0-19.99 Not at all
20-39.99 Small Extent
40-59.99 Moderate Extent
60-79.99 Large Extent
80-100 Great Deal
APPENDIX A
LIST OF RESPONDENTS
INTERNATIONAL FINANCIAL INSTITUTIONS
Institutions Address Respondent Position
1 German Development Cooperation PDCP Bank Center, Rufino St., Makati City Mayro Heowiz Program Manager
2 Local Government Support Program-Phil/Canada 1508 Jollibee Plaza, Ortigas Center, Pasig City Evelyn C. Jiz National Program Coordinator
3 Philippine Development Assistance Programme Brgy. Laging Handa, Quezon City Jerry E. Pacturan Executive Director
4 Philippine-Australian Community Assistance Program Prestige Tower, Ortigas Center, Pasig City Rodolfo Cesar R. VillanuevaArea Manager
5 SEARCA College, Laguna Dr. Arsenio M. Balisacan Director

NONGOVERNMENT ORGANIZATIONS
Organizations Address Respondent Position

1 Andres Soriano Foundation Asai Hangar Andrew Ave., Pasay City Mario S. Ocampo Asst. Operations Manager
2 Association of Government Internal Auditors New Manila, Quezon City Salvador Las Secretariat Assistant
3 Ateneo Social Science Research Center
4 Cebu City Resource Mgt & Dev't Center Sister Cities Drive, Cebu City Belinda K. Navascues Executive Director
5 Center for Community Transformation Ruth S. Callanta President
6 Free LAVA, Inc. San Juan Luna cor. Zamora Sts., Cebu City Antonio C. Auditor Executive Director
7 Institute for Environmental Conservation & Research
8 Jaime V. Ongpin Foundation, Inc. Sofia de Veyra St., Quezon Hill, Baguio City Ma. Rosario R. Lopez Executive Director
9 Julio & Florentina Ledesma Foundation, Inc. Cebu Ave., San Carlos City, Negros Occidental Dr. Billy T. Tusalem Executive Director
10 KALAHI-CIDSS: KKB 4th Floor, DSWD, IBP Road, Quezon City Camilo G. Gudmalin National Project Manager
11 Kalimudan Foundation, Inc. Biaba Damag, Marawi City Amenodin T. Cali Executive Director
12 Mindanao Rural Development Project St. Anthony Village, Mamay Road, Lanang, Davao City Consolacion G. Gasacao Program Accountant
13 Misamis University Community Extension Prog. H. T. Feliciano St., Ozamis City Grace V. Villanueva Director
14 National Confederation of Cooperatives 227 J. P. Rizal St., Project 4, Quezon City Emelina M. Santos Manager
15 PhilDHRRA 59 C. Salvador St., Loyola Heights, Quezon City Jesus Vicente C. GarganeraNational Coordinator
16 Philippine Business for Social Progress Real cor. Magallanes St., Intramuros, Manila Ma. Nilda U. Loresto Program Officer
17 Small Economic Enterprises Development, Inc. J.M. Escriva Drive, Ortigas Center, Pasig City Anita L. Ambrosio General Manager
18 Tanggol Kalikasan CRM Building III, 106 Kamias, Quezo City Asis G. Perez Executive Director
19 UP Population Institute 3rd Floor, Palma Hall, UP Diliman, Quezon City Normita T. Galban University Researcher
20 WWW-Philippines 65 Mindanao Ave., Quezon City Edgardo E. Tongson VP for Programmes

ACADEMIC INSTITUTIONS
Institutions Address Respondent Position
1 Ateneo Center for Community Services Ateneo de Manila University, Loyola Heights, Quezon City Norlie H. Quesada Associate Director
2 Bukidnon State College Malaybalay City, Bukidnon Mercedes Gloria D. Ramos Program Director
3 Camarines Norte State College Pasig, Daet, Camarines Norte Rusty G. Abanto Planning Director
4 Cebu Normal University Zosima A. Panarez Director for Research & Dev't.
5 Center for Local Governance Ateneo de Naga University, Naga City Malu C. Barillano Director
6 Development Academy of the Philippines Ortigas Center, Pasig City Julie D. Paran Director
7 Holy Name University Tagbilaran City, Bohol Josefina T. Cemine Research Associate
 8 Institute of Development Mgt. & Governance UP Los Banos, College, Laguna Dr. Aser B. Javier Director
9 La Salle Institute of Governance Estrada St., Malate, Manila Dr. Francisco Magno Executive Director
10 Mindanao Center for Local Governance, Inc. Mindanao State University, Marawi City Nabihah Noni Lao President
11 Southern Baptist College Alvin Lynn P. Bergante Executive Vice President
12 Southern Christian College Midsayap, Cotabato Dr. Romulo M. Garcesa VP for Finance
13 Southern Luzon Polytechnic College Lucban, Quezon Milo O. Placino Vice President
14 University of Northern Philippines Vigan City, Ilocos Sur Norma A. Esguerra Director for Planning
15 University of San Agustin Gen. Luna St., Iloilo City Jigger S. Latoza Director
16 University of the Philippines Open University Los Banos, Laguna Dr. Melinda F. Lumanta Vice-Chancellor
17 West Visayas State University Luna St., La Paz, Iloilo City Lourdes C. Aranador President

NATIONAL GOVERNMENT AGENCIES/GOVERNMENT OWNED AND CONTROLLED CORPORATIONS

Agencies Address Respondent Position
1 Bureau of Local Government Development DILG Central Office, EDSA, Diliman, Quezon City Manuel Q. Gotis Director IV
2 Bureau of Local Government Finance BSP Complex, Roxas Blvd., Manila Norberto G. Malvar OIC-Deputy Executive Director
3 Commission on Audit-Caloocan City A. Mabini St., Caloocan City Renato B. Salvador Supervising Auditor
4 Commission on Audit-City of Manila City of Manila Chito R. Ramirez Supervising Auditor
5 Commission on Audit-Las Pinas City Pamplona III, Las Pinas City Marilou L. Carag Supervising Auditor
6 Commission on Audit-Makati City Makati City Gabriel J. Espina Supervising Auditor
7 Commission on Audit-Malabon City San Agustin, Malabon City Atenie F. Padilla Supervising Auditor
8 Commission on Audit-Mandaluyong City Mandaluyong City Lucila B. Africa State Auditor V
9 Commission on Audit-Marikina City Barangay Sta. Elena, Marikina City Nestor F. De la Rosa City Auditor
10 Commission on Audit-Muntinlupa City National Road, Muntinlupa City Maxima A. Aquino Supervising Auditor
11 Commission on Audit-Paranaque City Paranaque City Rosa A. De la Cruz State Auditor V
12 Commission on Audit-Pateros Municipal Audit Office, Pateros, Metro Manila Delia R. Asi State Auditor IV
13 Commission on Audit-Quezon City Commonwealth Ave., Quezon City Eduardo F. Hayog State Auditor V
14 Department of Budget and Manager Gen. Solano St., San Miguel, Manila Carmencita N. Delantar Director IV
15 Development Bank of the Philippines Sen. Gil J. Puyat Ave., Makati City Anita C. Salayon Asst. Vice President
16 DILG-Mindanao Basic Urban Services Sector Project DILG Central Office, EDSA, Diliman, Quezon City Rolyn Zambales OIC-Assistant Director
17 Land Bank of the Philippines M. H. del Pilar cor. Dr. Quintos Drive, Malate, Manila Melinda C. Cruz Asst. Department Manager
18 Land Bank of the Philippines-Field Office
19 Local Government Academy Agustin I Bldg., Emerald Ave., Ortigas Center, Pasig City
20 National Economic and Development Authority Jose Maria Escriva Drive, Ortigas Center, Pasig City Susan Rachel G. Jose Director III
21 Philippine Institute for Development Studies Makati City Mari-Len R. Macasaquit Supervising Research Specialist
 CITIES

1 Angeles Irish C. Calaguas Executive Assistant IV

2 Bayawan (Oriental Negros) Jenilyn B. Norico
3 Cabancalan (Negros Occidental) Jesse A. Tanmoya City Planning and Development Coordinator
4 Calamba (Laguna)
5 Calbayog (Samar) Hon. Mel Senen S. Sarmiento City Mayor
6 Dagupan Romeo C. Rosario City Planning and Development Coordinator
7 Dipolog Romeo C. Reyes City Administrator
8 Dumaguete Josephine M. Antonio City Planning and Development Coordinator
9 Iligan Gil R. Balondo City Planning and Development Coordinator
10 Isabela (Basilan) Edgardo C. Halasan City Planning and Development Coordinator
11 Island Garden City of Samal Hon. Rogelio P. Antalan City Mayor
12 Ligao Hon. Linda P. Gonzales City Mayor
13 Lucena Leonora D. Papa Special Asst. for Social and Dev't Services
14 Makati Merlina G. Panganiban City Urban Development Officer
15 Masbate Rowena R. Tuason City Planning and Development Coordinator
16 Muntinlupa Allan A. Cachuela City Planning and Development Coordinator
17 Pasay Corazon A. Ramos Asst. Supervising Auditor
18 Passi Milrose D. Lusaya Management and Audit Analyst III
19 Puerto Princesa George G. Vasquez Asst. City Planning and Development Coordinator
20 San Carlos City (Pangasinan) Elma D. Garcia Asst. City Planning and Development Coordinator
21 San Fernando (La Union) Rudy P. Ducusin City Planning and Development Coordinator
22 San Fernando (Pampanga) Sonia P. Soto City Administrator
23 San Jose del Monte (Bulacan) Ana D. Sucgang City Budget Officer
24 San Pablo (Laguna)
25 Santiago (Isabela) Benedict B. Panganiban City Planning and Development Coordinator
26 Silay Gregorio G. Legarde City Government Asst. Department Head
27 Sipalay (Negros Occidental) Leo S. Agbas City Local Government Dev't Officer
28 Tacloban Edgardo E. Macion ICO-City Treasurer
29 Tagbilaran Eduardo C. Macalandag City Planning and Development Coordinator
30 Tagum Reynaldo G. Cadelina City Planning and Development Coordinator
31 Toledo Amador B. Cavan Executive Assistant I
32 Trece Martires Alberto Ararao City Planning and Development Coordinator
33 Valencia (Bukidnon) Hon. Jose M. Galario, Jr. City Mayor
34 Zamboanga Hon. Celso L. Lobregat City Mayor
 PROVINCES

1 Abra Ma. Victoria V. Alogoc Provincial Treasurer

2 Agusan del Sur Deanna P. Fudalan Provincial Planning and Development Coordinator
3 Aklan Rex Victor B. Consemino Provincial Government Asst. Department Head
4 Albay Macario M. Pavia Provincial Planning and Development Coordinator
5 Batangas Romulo A. Atienza Provincial Planning and Development Coordinator
6 Bulacan Arlene G. Pascual Provincial Planning and Development Coordinator
7 Capiz Antonio T. Arbis/Antonio V. Asis Provincial Budget Officer/OIC-PPDC
8 Davao del Sur Abel A. Guinares Provincial Treasurer
9 Kalinga Norma Frances U. Damina Provincial Planning and Development Coordinator
10 La Union Mauro A. Libatique, Jr. Provincial Planning and Development Coordinator
11 Misamis Oriental Hon. Oscar S. Moreno Governor
12 Mountain Province Lily Rose T. Kollin Provincial Planning and Development Coordinator
13 Sarangani Fredo P. Bagino Provincial Administrator
14 Sultan Kudarat Romeo B. Zaragoza Provincial Planning and Development Coordinator

MUNICIPALITIES

1 Bacarra, Ilocos Norte Clemente S. Galiza Executive Secretary

2 Bangued, Abra
3 Concepcion, Tarlac
4 La Trinidad, Benguet
5 Larena, Siquijor
6 Loon, Bohol
7 Manolo Fortich, Bukidnon
8 Naawan, Misamis Oriental
9 Pila, Laguna
10 San Miguel, Zamboanga del Sur
11 Sibulan, Negros Oriental
12 Tudela, Cebu
Isabelo B. Belisario
Hon. Noel L. Villanueva
Nympha N. Lacson
Rito B. Abapo
Rogelio P. Ganados
Hon. Socorro O. Acosta
Salvador Almune
Jose P. Matienzo, Jr.
Panfilo Sebilo Jr.
Cornelia C. Lozaga
Emer O. Labauo
Municipal Treasurer
Municipal Mayor
Municipal Accountant
Municipal Planning and Development Coordinator
Municipal Planning and Development Coordinator
Municipal Mayor
Municipal Planning and Development Coordinator
Municipal Planning and Development Coordinator
Municipal Planning and Development Coordinator
Municipal Budget Officer
Municipal Planning and Development Coordinator
APPENDIX B
LIST OF RESPONDENTS
INTERNATIONAL FINANCIAL INSTITUTIONS
Institutions Address Respondent Position
1 German Development Cooperation PDCP Bank Center, Rufino St., Makati City Mayro Heowiz Program Manager
2 Local Government Support Program-Phil/Canada 1508 Jollibee Plaza, Ortigas Center, Pasig City Evelyn C. Jiz National Program Coordinator
3 Philippine Development Assistance Programme Brgy. Laging Handa, Quezon City Jerry E. Pacturan Executive Director
4 Philippine-Australian Community Assistance Program Prestige Tower, Ortigas Center, Pasig City Rodolfo Cesar R. VillanuevaArea Manager
5 SEARCA College, Laguna Dr. Arsenio M. Balisacan Director

NONGOVERNMENT ORGANIZATIONS
Organizations Address Respondent Position

1 Andres Soriano Foundation Asai Hangar Andrew Ave., Pasay City Mario S. Ocampo Asst. Operations Manager
2 Association of Government Internal Auditors New Manila, Quezon City Salvador Las Secretariat Assistant
3 Ateneo Social Science Research Center
4 Cebu City Resource Mgt & Dev't Center Sister Cities Drive, Cebu City Belinda K. Navascues Executive Director
5 Center for Community Transformation Ruth S. Callanta President
6 Free LAVA, Inc. San Juan Luna cor. Zamora Sts., Cebu City Antonio C. Auditor Executive Director
7 Institute for Environmental Conservation & Research
8 Jaime V. Ongpin Foundation, Inc. Sofia de Veyra St., Quezon Hill, Baguio City Ma. Rosario R. Lopez Executive Director
9 Julio & Florentina Ledesma Foundation, Inc. Cebu Ave., San Carlos City, Negros Occidental Dr. Billy T. Tusalem Executive Director
10 KALAHI-CIDSS: KKB 4th Floor, DSWD, IBP Road, Quezon City Camilo G. Gudmalin National Project Manager
11 Kalimudan Foundation, Inc. Biaba Damag, Marawi City Amenodin T. Cali Executive Director
12 Mindanao Rural Development Project St. Anthony Village, Mamay Road, Lanang, Davao City Consolacion G. Gasacao Program Accountant
13 Misamis University Community Extension Prog. H. T. Feliciano St., Ozamis City Grace V. Villanueva Director
14 National Confederation of Cooperatives 227 J. P. Rizal St., Project 4, Quezon City Emelina M. Santos Manager
15 PhilDHRRA 59 C. Salvador St., Loyola Heights, Quezon City Jesus Vicente C. GarganeraNational Coordinator
16 Philippine Business for Social Progress Real cor. Magallanes St., Intramuros, Manila Ma. Nilda U. Loresto Program Officer
17 Small Economic Enterprises Development, Inc. J.M. Escriva Drive, Ortigas Center, Pasig City Anita L. Ambrosio General Manager
18 Tanggol Kalikasan CRM Building III, 106 Kamias, Quezo City Asis G. Perez Executive Director
19 UP Population Institute 3rd Floor, Palma Hall, UP Diliman, Quezon City Normita T. Galban University Researcher
20 WWW-Philippines 65 Mindanao Ave., Quezon City Edgardo E. Tongson VP for Programmes

ACADEMIC INSTITUTIONS
Institutions Address Respondent Position
1 Ateneo Center for Community Services Ateneo de Manila University, Loyola Heights, Quezon City Norlie H. Quesada Associate Director
2 Bukidnon State College Malaybalay City, Bukidnon Mercedes Gloria D. Ramos Program Director
3 Camarines Norte State College Pasig, Daet, Camarines Norte Rusty G. Abanto Planning Director
4 Cebu Normal University Zosima A. Panarez Director for Research & Dev't.
5 Center for Local Governance Ateneo de Naga University, Naga City Malu C. Barillano Director
6 Development Academy of the Philippines Ortigas Center, Pasig City Julie D. Paran Director
7 Holy Name University Tagbilaran City, Bohol Josefina T. Cemine Research Associate
 8 Institute of Development Mgt. & Governance UP Los Banos, College, Laguna Dr. Aser B. Javier Director
9 La Salle Institute of Governance Estrada St., Malate, Manila Dr. Francisco Magno Executive Director
10 Mindanao Center for Local Governance, Inc. Mindanao State University, Marawi City Nabihah Noni Lao President
11 Southern Baptist College Alvin Lynn P. Bergante Executive Vice President
12 Southern Christian College Midsayap, Cotabato Dr. Romulo M. Garcesa VP for Finance
13 Southern Luzon Polytechnic College Lucban, Quezon Milo O. Placino Vice President
14 University of Northern Philippines Vigan City, Ilocos Sur Norma A. Esguerra Director for Planning
15 University of San Agustin Gen. Luna St., Iloilo City Jigger S. Latoza Director
16 University of the Philippines Open University Los Banos, Laguna Dr. Melinda F. Lumanta Vice-Chancellor
17 West Visayas State University Luna St., La Paz, Iloilo City Lourdes C. Aranador President

NATIONAL GOVERNMENT AGENCIES/GOVERNMENT OWNED AND CONTROLLED CORPORATIONS

Agencies Address Respondent Position
1 Bureau of Local Government Development DILG Central Office, EDSA, Diliman, Quezon City Manuel Q. Gotis Director IV
2 Bureau of Local Government Finance BSP Complex, Roxas Blvd., Manila Norberto G. Malvar OIC-Deputy Executive Director
3 Commission on Audit-Caloocan City A. Mabini St., Caloocan City Renato B. Salvador Supervising Auditor
4 Commission on Audit-City of Manila City of Manila Chito R. Ramirez Supervising Auditor
5 Commission on Audit-Las Pinas City Pamplona III, Las Pinas City Marilou L. Carag Supervising Auditor
6 Commission on Audit-Makati City Makati City Gabriel J. Espina Supervising Auditor
7 Commission on Audit-Malabon City San Agustin, Malabon City Atenie F. Padilla Supervising Auditor
8 Commission on Audit-Mandaluyong City Mandaluyong City Lucila B. Africa State Auditor V
9 Commission on Audit-Marikina City Barangay Sta. Elena, Marikina City Nestor F. De la Rosa City Auditor
10 Commission on Audit-Muntinlupa City National Road, Muntinlupa City Maxima A. Aquino Supervising Auditor
11 Commission on Audit-Paranaque City Paranaque City Rosa A. De la Cruz State Auditor V
12 Commission on Audit-Pateros Municipal Audit Office, Pateros, Metro Manila Delia R. Asi State Auditor IV
13 Commission on Audit-Quezon City Commonwealth Ave., Quezon City Eduardo F. Hayog State Auditor V
14 Department of Budget and Manager Gen. Solano St., San Miguel, Manila Carmencita N. Delantar Director IV
15 Development Bank of the Philippines Sen. Gil J. Puyat Ave., Makati City Anita C. Salayon Asst. Vice President
16 DILG-Mindanao Basic Urban Services Sector Project DILG Central Office, EDSA, Diliman, Quezon City Rolyn Zambales OIC-Assistant Director
17 Land Bank of the Philippines M. H. del Pilar cor. Dr. Quintos Drive, Malate, Manila Melinda C. Cruz Asst. Department Manager
18 Land Bank of the Philippines-Field Office
19 Local Government Academy Agustin I Bldg., Emerald Ave., Ortigas Center, Pasig City
20 National Economic and Development Authority Jose Maria Escriva Drive, Ortigas Center, Pasig City Susan Rachel G. Jose Director III
21 Philippine Institute for Development Studies Makati City Mari-Len R. Macasaquit Supervising Research Specialist
 CITIES

1 Angeles Irish C. Calaguas Executive Assistant IV

2 Bayawan (Oriental Negros) Jenilyn B. Norico
3 Cabancalan (Negros Occidental) Jesse A. Tanmoya City Planning and Development Coordinator
4 Calamba (Laguna)
5 Calbayog (Samar) Hon. Mel Senen S. Sarmiento City Mayor
6 Dagupan Romeo C. Rosario City Planning and Development Coordinator
7 Dipolog Romeo C. Reyes City Administrator
8 Dumaguete Josephine M. Antonio City Planning and Development Coordinator
9 Iligan Gil R. Balondo City Planning and Development Coordinator
10 Isabela (Basilan) Edgardo C. Halasan City Planning and Development Coordinator
11 Island Garden City of Samal Hon. Rogelio P. Antalan City Mayor
12 Ligao Hon. Linda P. Gonzales City Mayor
13 Lucena Leonora D. Papa Special Asst. for Social and Dev't Services
14 Makati Merlina G. Panganiban City Urban Development Officer
15 Masbate Rowena R. Tuason City Planning and Development Coordinator
16 Muntinlupa Allan A. Cachuela City Planning and Development Coordinator
17 Pasay Corazon A. Ramos Asst. Supervising Auditor
18 Passi Milrose D. Lusaya Management and Audit Analyst III
19 Puerto Princesa George G. Vasquez Asst. City Planning and Development Coordinator
20 San Carlos City (Pangasinan) Elma D. Garcia Asst. City Planning and Development Coordinator
21 San Fernando (La Union) Rudy P. Ducusin City Planning and Development Coordinator
22 San Fernando (Pampanga) Sonia P. Soto City Administrator
23 San Jose del Monte (Bulacan) Ana D. Sucgang City Budget Officer
24 San Pablo (Laguna)
25 Santiago (Isabela) Benedict B. Panganiban City Planning and Development Coordinator
26 Silay Gregorio G. Legarde City Government Asst. Department Head
27 Sipalay (Negros Occidental) Leo S. Agbas City Local Government Dev't Officer
28 Tacloban Edgardo E. Macion ICO-City Treasurer
29 Tagbilaran Eduardo C. Macalandag City Planning and Development Coordinator
30 Tagum Reynaldo G. Cadelina City Planning and Development Coordinator
31 Toledo Amador B. Cavan Executive Assistant I
32 Trece Martires Alberto Ararao City Planning and Development Coordinator
33 Valencia (Bukidnon) Hon. Jose M. Galario, Jr. City Mayor
34 Zamboanga Hon. Celso L. Lobregat City Mayor

PROVINCES

1 Abra Ma. Victoria V. Alogoc Provincial Treasurer

2 Agusan del Sur Deanna P. Fudalan Provincial Planning and Development Coordinator
3 Aklan Rex Victor B. Consemino Provincial Government Asst. Department Head
4 Albay Macario M. Pavia Provincial Planning and Development Coordinator
5 Batangas Romulo A. Atienza Provincial Planning and Development Coordinator
6 Bulacan Arlene G. Pascual Provincial Planning and Development Coordinator
7 Capiz Antonio T. Arbis/Antonio V. Asis Provincial Budget Officer/OIC-PPDC
8 Davao del Sur Abel A. Guinares Provincial Treasurer
9 Kalinga Norma Frances U. Damina Provincial Planning and Development Coordinator
10 La Union Mauro A. Libatique, Jr. Provincial Planning and Development Coordinator
11 Misamis Oriental Hon. Oscar S. Moreno Governor
12 Mountain Province Lily Rose T. Kollin Provincial Planning and Development Coordinator
13 Sarangani Fredo P. Bagino Provincial Administrator
14 Sultan Kudarat Romeo B. Zaragoza Provincial Planning and Development Coordinator

MUNICIPALITIES

1 Bacarra, Ilocos Norte Clemente S. Galiza Executive Secretary

2 Bangued, Abra
3 Concepcion, Tarlac
4 La Trinidad, Benguet
5 Larena, Siquijor
6 Loon, Bohol
7 Manolo Fortich, Bukidnon
8 Naawan, Misamis Oriental
9 Pila, Laguna
10 San Miguel, Zamboanga del Sur
11 Sibulan, Negros Oriental
12 Tudela, Cebu
Isabelo B. Belisario
Hon. Noel L. Villanueva
Nympha N. Lacson
Rito B. Abapo
Rogelio P. Ganados
Hon. Socorro O. Acosta
Salvador Almune
Jose P. Matienzo, Jr.
Panfilo Sebilo Jr.
Cornelia C. Lozaga
Emer O. Labauo
Municipal Treasurer
Municipal Mayor
Municipal Accountant
Municipal Planning and Development Coordinator
Municipal Planning and Development Coordinator
Municipal Mayor
Municipal Planning and Development Coordinator
Municipal Planning and Development Coordinator
Municipal Planning and Development Coordinator
Municipal Budget Officer
Municipal Planning and Development Coordinator
 APPENDIX C

INSTITUTIONAL MAPPING AND ANALYSIS OF ORGANIZATIONS’ EFFORTS, INITIATIVES,

AND ASSISTANCE TO LOCAL FINANCIAL PLANNING AND MANAGEMENT

FOR KEY INFORMANTS’ USE

Please fill the information below before answering the survey questions. Please write legibly in ink.

1. Date of survey (dd/mm/yyyy): ______________________________________________

2. Name of Respondent’s Organization: _______________________________________

_____________________________________________________________________

3. Address of Respondent’s Organization: ______________________________________

______________________________________________________________________

4. Respondent’s Name (last, first, middle initial) __________________________________

5. Respondent’s Job Title: ___________________________________________________

6. Respondent’s Contact Information:

6.1. Telephone No.:_____________________________________________________

6.2. Fax No.: __________________________________________________________
6.3. Mobile/Cell phone No.: _______________________________________________
6.4. E-mail:____________________________________________________________
6.5. Others: ___________________________________________________________

7. Interviewer’s Name (last, first, middle initial): __________________________________

85
 PART I – DESCRIPTION OF SUPPORT IN THE FIELD OF LFPM
1. Areas of Support. In what areas does your organization provide support to LGUs? Please
check the corresponding space and provide some details. In the type or nature of support
column, please encircle all choices that apply:

1 Program/project 5 Policy support 8 Capacity building support/

2 Financial assistance 6 Networking/ training/seminars
3 Equipment/facility donation linkaging 9 Research studies/surveys
4 Awards system 7 Planning support 10 Others (please specify)
Please No. of years Please describe the type or nature of
AREAS OF SUPPORT check providing support in the area*
here support in this
area
A Revenue Generation
1. Real property taxation 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

2. Business permits and licenses 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

3. Build-operate-transfer scheme 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

4. Municipal bonds 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

5. Others, please specify_________ 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

B Accounting
1. Financial accounting and 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
reporting 10 __________________________

2. Expenditure management 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

3. Assistance for the New 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

Government Accounting System 10 __________________________

4. Others, please specify _________ 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

C Budgeting 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

D Internal Auditing 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

E Capacity Building in LFPM

1. Training in LFPM 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

2. Study Tours 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

86
 3. Exchanges (sister city, twinning, 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
etc.) 10 __________________________

4. Others, please specify ________ 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

F Local Economic Development

1. Project feasibility studies 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

2. Establishing local economic 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

enterprises 10 __________________________

3. Project management and 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

financing 10 __________________________

4. Financial packaging 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

5. Others, please specify _________ 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

G Local Development Planning 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

H Procurement Process 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |
10 __________________________

I Research and Advocacy 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |9 |

10 __________________________

2. Is the provision of support to LGUs in the field of LFPM within your organizational mandate?

Yes No

If yes, please state the mandate: _____________________________________________________

_______________________________________________________________________________
_______________________________________________________________________________

3. What are the specific activities involved in the provision of support?

Program / project design Study tours

Program / project management
Capacity building needs analysis
Training / seminars / workshops
Awarding of cash and other incentives
Facilitation of LGU activities
Survey / research studies
Participatory workshops
Monitoring and evaluation
Others pls. specify _________________

87
4. How do you tap the LGUs as partner/beneficiary?
Pls. check Please give details
Referral of other † LGU
organizations/ † NGO
agencies/officials † National Government Agency
† Private Organization
† Others, pls. specify
Your own identification † Directory Search
process † Internet Search
† In-house database search / mailing list
† Third party database search / mailing list
† Selected from previous partners
† Others, please specify
Your own search through † Placing newspaper and print ads
public announcement † Placing newsletter announcement
† Internet posting
† Sending message to mailing list
† Placing radio ads
† Placing television ads
† Others, pls. specify
LGU own initiative † Proposal submission
† Formal request for assistance
† Informal request for assistance (during an important
meeting, etc)
† Others, pls. specify
Extension of other † Previous partnership undertakings
previous partnership † Membership in same organization / association
† Others, pls. specify
Others, pls. specify

5. Are there any formal working arrangements with the LGU?

Yes No

If yes, in what form?

† Memorandum of Agreement † Technical Cooperation Program

† Memorandum of Understanding † Financial Cooperation Program
† Contract † Others, please specify _____________

6. What are the terms, conditions or obligations of support to the LGU partner/beneficiary?

On your part On LGU’s part

† Timely release of funds
† Conduct of baseline survey (before collaboration /
assistance)
† Provision of technical assistance / expert services
† Monitoring and evaluation
† Impact assessment
† Compliance to agreed terms of reference
† Others _____________________________
† Must first demonstrate readiness / or must pass
readiness assessment
† Proposed area of collaboration / program /
project must be within the priority areas
† Counterpart funds / resources
† Accept “structural adjustments” packaged with
the assistance
† Delivery of agreed objectives / expected outputs
of collaboration
† Should submit technical reports on collaboration
† Should submit financial reports on collaboration
† Others____________________________

88
7. What is the cost of provision of support to the LGU partner/beneficiary in terms of

Direct cash outlay ______________

Facilities and equipment ______________
Noncash expenses ______________
Others ______________

Total ______________

8. Are there assets generated by the LGU as a result of the partnership/assistance?

Yes No

If yes, what are these assets?

† Equipment † Improved systems / procedures /

† Enhanced LGU service facilities protocols
† Additional supplies † Intellectual properties
† Additional funds † Additional institutional linkages /
† Trained human resources networks
† Others, please specify _____________

9. Were there specific skills and capabilities developed or improved for LGU staff as a result of
the support?

Yes No

If yes, what are the these skills and capabilities?

† Project development † Income generation capability

† Project management † Monitoring and evaluation
† Financial analysis † Use of ICT equipment
† Financial planning † Planning skills
† Managerial finance † Policy formulation / development /
† Budgeting analysis skills
† Conduct of surveys / studies / research † Others, pls. specify
† Feasibility analysis _______________________________

10. Has your support/partnership created awareness for large scale local community
participation or support?

Yes No

If yes, cite proof, cases or instances to support your claim.

† Improved turnout rate at LGU initiated activities

† Increased LGU revenue collection
† Survey / impact assessment results
† Others: _______________________________

89
11. What are the specific outputs resulting from your support/partnership?

† Trainings / seminars / workshops † Plans formulated

conducted † Policies formulated / analyzed / passed
† Trained LGU staff † Systems / procedures / protocols
† Study / research / survey results established
† Study sites visited † Modern equipment / facilities
† Plans formulated † Others:
† Programs / projects designed ____________________________

12. What do you think are the other benefits derived by the LGU from your support/
partnership?

† Improvement in quality of LGU projects in other areas aside from financial planning and management
† Improved transparency / accountability
† Improved public perception / participation
† Organizational efficiency / effectiveness
† Increased private investments
† Increased visibility to public

13. How many LGUs have you supported?

No. of LGUs Please give details

supported
Provinces
Cities
Municipalities
Barangays

14. Are you satisfied with the quality of your work relationship with the LGU?

Yes No

If yes, why?

† So far, no serious problems have been encountered

† Such working relationship is ideal and can deliver what it is supposed to deliver
† Provides mutual benefit to collaborating parties
† Relationship is flexible and allows room for necessary adjustments without much trouble
† Independent of any political agenda
† Others: ____________________________________________________________________________
___________________________________________________________________________________

If no, why?

† Existing working relationship is problematic / gaps are present in various aspects

† Working relationship cannot always deliver what it is supposed to deliver
† Only the LGU benefits
† Relationship is rigid and does not allow adjustments anytime during period of collaboration
† Relationship is being associated with political agenda of LGU
† Others: _____________________________________________________________________________
___________________________________________________________________________________

90
15. Do you know other organizations that support the LGUs on financial planning and
management?

Yes No

If yes, please enumerate. __________________________________________________________

_______________________________________________________________________________
_______________________________________________________________________________

16. What are the activities of the organizations which you have identified?

† program/project development and † planning support

implementation † capacity building support /training /
† financial assistance seminars/workshop
† equipment / facility donation † research studies / surveys
† awards system † Others (please specify)
† policy support ____________________________
† networking / linkaging

17. Is your organization open to the possibility of having partnership or other forms of linkages
with the Ateneo EPRA Project?

Yes No

If yes, what do you think is the best type of arrangement between you and Ateneo EPRA Project?
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________

18. Are there gaps and overlaps that exist insofar as activities, roles and support to LGU other
than your organization?

Yes No

If yes, what are they? _____________________________________________________________

_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

19. What are the common areas of confusion experienced in the course of implementing your
support program?

_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

20. Are there other important issues on LFPM support to LGUs that have not been discussed in
this questionnaire? Please enumerate.
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

91
 PART II - SUPPORT LANDSCAPE

Please answer the following questions in the light of your provision of support to LGUs in the field of
Local Financial Planning and Management.

A. Facilitating Factors.

Yes No If No, do
you
FACILITATING FACTORS Remarks
consider it
a problem?
A OBJECTIVES OF SUPPORT
1 Does your support of the local
government have clear objectives?
2 Are the objectives of your support known
by the local government?
3 Are the objectives of both institutions
clear and specific on both sides?
4 Do your objectives define the local
stakeholders’ involvement?
5 Are your objectives of support translated
to operational plans?
B POLITICAL FEASIBILITY
1 Is there a long-term strategy for local
government support?
2 Is the provision of support a priority of
your organizational leadership?
3 Are the plans and programs of support in
line with the LGU’s vision and mission?
4 In general, is the community satisfied
with the mechanisms used to deliver the
support to the LGU?
5 Is there enough room on the part of your
leaders to decide the pursuance of support
to LGUs?
C STAFF BEHAVIOR
1 Are you staff friendly and approachable to
the LGU client-partners?
2 Are your staff willing to provide as much
assistance to the LGU client-partners?
3 Do your staff exhibit expertise on the job?
4 Do your staff provide quick responses to
your LGU client-partners in need?
5 Do your staff allow the LGU client-
partners to provide inputs or suggestions
to the programs/projects?
6 In general, has rapport been developed
between your staff and the LGU client?
D PROGRAM PROCESS
1 Is there a coordinating body that manages
the support program to the LGU?
2 Are there procedures and guidelines to
facilitate the implementation of plans and
programs with the LGU?
92
3 Does the support allow for mechanisms
that make use of established local
councils or boards?
4 Are there mechanisms for review,
evaluation and improvement of plans and
programs?
5 Do you achieve your client-partners goals
because of efficient programming?
E PARTICIPATORY APPROACH
1 Are your policies on program operations
determined with your LGU client-
partners?
2 Are your procedures carefully formulated
with maximum inputs from the LGU
client-partners?
3 Do you involve the LGU-clients in the
identification and prioritization of the
focus of support?
4 Do you conduct regular meetings and
consultations with the LGU client-
partners?
5 Do you involve the LGU client-partners in
monitoring of the status of your support?
F FINANCIAL ACCOUNTABILITY
1 Do your management practices result in
getting the best possible value from public
funds?
2 Do you require the LGU to formally
account for any financial obligations
through management contracts,
accountability accord or similar
managerial agreements?
3 Do you give financial management advice
that helps the local government make
better decisions?
4 Do you know how well the LGU is doing
in terms of financial management
responsibilities?
5 Do you have provisions in case of theft,
fraud or misuse of funds or property on the
part of the LGU?
G FINANCIAL TRANSPARENCY
1 Do you clearly communicate financial
management roles, objectives and policies
as they apply to the LGU?
2 Do you generate financial information that
is easily combined with operational data
for use in managing the LGU?
3 Do you make use of information
technology for improving efficiency in
managing LGU financial resources?
4 Do you provide updated information on
financial status to the LGU client-
93
 partners?
5 Are there mechanics to track financial
status during the entire duration of your
support?

B. Difficulties and Constraints

DIFFICULTIES AND CONSTRAINTS Yes No Comments

A FUNDING LIMITATIONS
1 Are your financial resources adequate to
meet your current objectives in the field
of LFPM?
2 Are your financial resources immediately
available when needed?
3 Are there provisions for future financial
requirements in LFPM?
4 Are financial resources allotted for
LFPM use for the purpose for which they
were intended?
B LINKAGING BARRIERS
1 Are there efforts for linkaging activities
that are initiated by your organization?
2 Are linkages embedded in the long-term
plan of your organization?
3 Are linkages with various entities
properly undertaken when necessary?
4 Are linkaging activities provided with
adequate financial support?
5 Are there barriers that hinder beneficial
linkages?
C POLITICAL INTERFERENCE
1 Are your mandates influenced by certain
political affiliation?
2 Do you encounter interference from
political figures or personalities?
3 Do you find coordinating with political
personalities (politicians) other than the
LGU officials contributory to the
accomplishment of your objectives?
4 Has the accomplishment of your tasks
been affected by political interference?
D POLICY CONFLICT
1 Are there national policies that are in
conflict with your rendition of support in
the field of LFPM?
2 Do you encounter conflicts in your
organizational policies that affect the
performance of your work?
3 Do you have conflicts in operating
policies that affect your activities?
4 Are conflicts in policies in general
immediately clarified?
E COMPETENCE AVAILABILITY
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1 Is there scarcity of knowledge or skills
among people in your organization that
constrain the management of your
support in the area of LFPM?
2 Do you have competency development
for the staff in your organization?
3 Do you encounter absence or lack of
technical knowledge among LGUs in
areas related to your provision of
support?
4 Do you have competency development
for the staff of your client LGUs in the
areas related to the support you provide?
F GEOGRAPHICAL DISPERSION OF LGU BENEFICIARIES
1 Do you have geographic preference in the
selection of client LGUs?
2 Do you consider geographical dispersion
among LGU clients as a problem?
3 Is geographical dispersion of LGU clients
adversely affecting the delivery of your
service?
4 Are your LGU clients encountering
problems with their geographic location
insofar as your support is concerned?
G INFORMATION DISSEMINATION
1 Is information regarding your support
properly disseminated to the target
audience?
2 Are there adequate mechanisms or
systems of information dissemination?
3 Are the means of information
dissemination effective in bringing about
the message?
4 Do you have adequate reach of your
target audience for information
dissemination?
H INTEREST OF LOCAL GOVERNMENT OFFICIALS
1 Are local government officials genuinely
interested in availing of the support
provided by your organization?
2 Is LFPM the primary interest of LGU
officials?
3 Did the LGU officials openly signify
their interest to avail of the support
provided by your organization?
4 Are LGU officials willing to undergo the
whole process of availing the support?

Thank you!

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