QUEZON CITY (PIA) -- President Ferdinand R. Marcos Jr. announced that the national government is moving forward with plans to fully devolve certain executive branch functions to local government units (LGUs). This action is to the Supreme Court's decision in the Mandanas-Garcia case, which mandates an increase in LGUs' just share of all national taxes and revenues.

During a press conference in Malacanang on March 21, Department of Budget and Management (DBM) Secretary Amenah F. Pangandaman assured local government units (LGUs) that the Marcos Jr. administration is actively listening to their concerns and inputs on the implementation of full devolution. In addition, the President has directed the National Economic and Development Authority (NEDA) to lead a study on the subject.

“The President hears and understands the concerns of LGUs with regards to full devolution. We wanted to ensure that decisions are not made haphazardly. We make decisions that are objective and fair for all," Secretary Pangandaman said.

The execution of complete devolution, as set out in Executive Order No. 138, series of 2021, was the subject of a meeting held between President Ferdinand R. Marcos Jr., the DBM, and the League of Municipalities last February.

“Maswerte po tayo dahil mayroon tayong Pangulo na malawak ang karanasan sa pangangasiwa sa lokal na pamahalaan. Matagal po siyang naglingkod bilang Governor ng probinsya, kaya ramdam at naiintindihan ng Pangulo ang lagay at saloobin ng mga LGUs dahil dyan po siya nanggaling,” Pangandaman added.

Full devolution promotes decentralization, as enshrined in the Constitution and the Local Government Code, by giving local governments more autonomy in managing their resources. This decentralization system is based on the assumption that local governments are better positioned to address the basic needs of their constituents and thus provide better services.

Recognizing the varying levels of expertise and capabilities of LGUs, the DBM, NEDA, Department of Interior and Local Government, and Department of Finance, among others, will provide ongoing capacity development interventions for LGUs.

Secretary Pangandaman announced the establishment of a Growth Equity Fund to address issues of inequality and disparities in LGU fiscal capacities (GEF). The GEF shall cover the funding requirements of poor, disadvantaged, and lagging LGUs for them to fully and efficiently implement the functions and services devolved to them.

Last year, the GEF received 1.2 billion pesos, and it will receive one billion pesos in the fiscal year 2023. The GEF will be distributed to 430 local governments (LGUs) from among the 1,477 cities and municipalities and 114 provinces.

The allocation and distribution of GEF funds to local governments must adhere to the implementing rules and regulations established by the Development Budget Coordination Committee. Furthermore, the distribution will be guided by mechanisms and guidelines that ensure equitable, performance-based, and timely distribution of funds to LGUs.

In the Mandanas Garcia case, the Supreme Court ruled that all collections of national taxes, except those accruing to special purpose funds and special allotments for the utilization and development of national wealth, should be included in the computation of the LGUs' just share. Full devolution is expected to increase LGU funding and improve the delivery of public services to their constituents.

The President emphasized the importance of examining the various functions of government and local government, as well as coordinating efforts at the local and national levels, in a speech delivered at the Manila Hotel during the general assembly of the League of Municipalities of the Philippines last February.

The President's directive to review the allocation of responsibilities, programs, and projects of both the Executive branch and local governments is intended to ensure the effective and efficient delivery of public services. The Growth Equity Fund and continuous capacity development interventions will help capacitate LGUs and address issues of inequality and disparities in fiscal capacities as the national government listens to LGU concerns and works toward full devolution. (AP- PIA CPSD)