President Ferdinand R. Marcos Jr. has signed Executive Order (EO) 103, extending the transition period for the full devolution of certain executive branch functions to local government units (LGUs) until 2028.

Under EO 103, signed on November 6, provinces and municipalities are expected to gradually shift to full devolution by 2028, while cities are expected to complete the process by 2027.

“All LGUs shall follow a phased implementation of the full devolution within the prescribed transition period as they continually improve their fiscal and institutional capacities,” the EO, released publicly on Saturday, stated.

The order aims to give LGUs more time to strengthen their financial, technical, and administrative capacities to handle devolved services under the Mandanas-Garcia ruling and the Local Government Code of 1991 (RA 7160).

EO 103 amends EO 138 (issued in 2021), by adding policies to ensure a smoother, phased transfer of responsibilities, with priority support for poorer and less developed LGUs.

“In light of the varying capacities and unique circumstances of LGUs, the functions, services, and facilities to be devolved from the national government may not be fully absorbed or implemented uniformly across all LGUs within the transition period mandated under EO 138,” the order noted.

The EO highlights the need for sufficient time to guarantee effective delivery of devolved services, especially for 4th to 5th income class and other disadvantaged LGUs, including those in geographically isolated areas or with high poverty incidence.

Under the revised policies, LGUs will take primary responsibility for delivering direct services to their communities, ensuring quality in line with national standards.

“The national government and LGUs shall collaborate to localize national development goals consistent with the Philippine Development Plan 2023–2028, AmBisyon Natin 2040, the 2030 Agenda for Sustainable Development, the Administration’s 8-Point Socioeconomic Agenda, and the Medium-Term Fiscal Framework 2022–2028,” the EO stated.

To fully assume devolved functions, LGUs are encouraged to optimize revenue generation and resource mobilization to support fiscal decentralization. EO 103 applies to all LGUs, except those in the Bangsamoro Autonomous Region in Muslim Mindanao.

National government agencies (NGAs) are directed to review their mandates and services to avoid overlaps and ensure a phased transition. Within 15 days of the EO’s effectivity, NGAs must organize devolution transition committees, with devolution transition plans to be submitted within 90 days of the release of implementing rules.

“The devolved functions and services already assumed by LGUs, as indicated in their DTPs, shall be mainstreamed and prioritized in local development plans, investment programs, and annual budgets,” the EO added.

LGUs are also encouraged to develop strategies and partnerships with other local governments to achieve economies of scale and improve public service delivery.

EO 103 takes effect immediately upon publication in the Official Gazette or in a newspaper of general circulation.