More funds, better local governance
The increased funding can also empower smaller LGUs to improve their performance, while larger LGUs should aim for excellence in service delivery.
Daily TribuneThe increased funding can also empower smaller LGUs to improve their performance, while larger LGUs should aim for excellence in service delivery.
With an anticipated 18.7 percent surge in funds next year, local government units (LGUs) are on the brink of a promising era. The substantial P1.03 trillion is a significant increase from this year's P871.38 billion, and holds the potential to revolutionize local governance, ushering in a period of optimism and hope.
The country’s economic recovery has resulted in a higher share of each LGU's National Tax Allotment (NTA), formerly the Internal Revenue Allotment. The change in name and the substantial increase were consistent with the 03 July 2018 Supreme Court ruling on the Mandanas-Garcia Case in favor of the petitioners that LGUs' share should be computed based on all national taxes.
Thus, of the 2025 NTA shares, P776.56 billion will come from the Bureau of Internal Revenue, P258 billion from the Bureau of Customs, and P41.36 million from other agencies as certified by the Bureau of Treasury, based on Local Budget Memorandum 90 issued on 13 June 2024 by the Department of Budget and Management.
The Philippines has 83 provinces, 149 cities, 1,485 municipalities, and 41,905 barangays. Regarding the NTA allocation, municipalities will get the largest share, amounting to P350.68 billion. Cities will follow with an allocation of P239.05 billion, provinces with P237.96 billion, and the barangays with P206.92 billion.
The prospect of receiving a larger budget is met with enthusiasm as it would provide new or returning local leaders with the resources to support a greater variety of community projects, leading to enhanced local governance. However, it is important to note that this optimistic scenario may not always be the prevailing reality.
Depending on the integrity of your local officials, some of whom may be either incompetent or corrupt, there is always the risk of potential misuse or embezzlement.
While allocating more funds to local projects might seem beneficial, it only sometimes guarantees tangible benefits for the people. Such is evident from white elephant projects in our communities - projects that either remain incomplete or are finished but ultimately have little to no impact or value to the residents. These projects often become obsolete once the responsible local officials leave their positions, resulting in fund wastage and added stress for the people.
Local leaders must make extra efforts to ensure that the country's economic progress reaches the grassroots level and provides tangible benefits, especially for the marginalized population. The funds should encourage local leaders to excel in financial management and service delivery, not to enrich themselves. This commitment to excellence should be a driving force for all local leaders.
Insufficient funding usually poses a significant challenge in obtaining the necessary resources for vital infrastructure and essential services to support the rapidly growing rural and urban populations in many developing nations, including the Philippines.
Sometimes, larger towns, cities, and provinces get stuck in extensive bureaucratic processes. Due to their limited population, smaller counterparts may demonstrate a more agile and responsive approach to governance.
Therefore, the increased NTA is a vital innovation to address current constraints and provide much-needed funding to meet urgent needs. It addresses funding gaps to enhance the efficient delivery of essential services at the local level.
The increased funding can also empower smaller LGUs to improve their performance, while larger LGUs should aim for excellence in service delivery.
Local administrators can significantly improve their financial management by implementing robust strategies to enhance the efficiency of local revenue collection, such as modernizing tax collection systems, streamlining administrative processes, and leveraging technology to track and monitor revenue streams effectively.
By doing so, LGUs can effectively allocate their increased resources, make informed financial decisions, and strategically invest in projects and initiatives that can lead to economic growth, increased revenue, and overall prosperity for the community.
Above all, ensuring the utmost transparency and efficiency in managing the additional local funds is not negotiable. This approach will shield against potential mismanagement or corruption, providing the public with a sense of security and reassurance.
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