The PDF Working Group on Decentralization and Local Government (PDF WG-DLG) is a platform for policy dialogue and coordination of development assistance to achieve development outcomes through decentralization and local governance. The convenor of the Working Group is the Department of the Interior and Local Government (DILG) while the World Bank (WB) is the co-convenor. The Working Group members include: (1) national government oversight agencies, e.g. DILG, Department of Budget and Management (DBM), Department of Finance (DOF), and National Economic Development Authority (NEDA); (2) LGU leagues; and, (3) development partners.1
In line with the 2011-2016 Philippine Development Plan’s (PDP) encompassing goal to achieve inclusive growth that is rapid and sustainable, that creates employment opportunities and reduces poverty, the PDF WG-DLG drafted the attached 2013-16 Work Plan. The PDF WG-DLG 2013-16 Work Plan identifies three Development Agenda to guide projects and activities, these are: (1) Improving Local Fiscal Autonomy for Inclusive Growth and Development; (2) Promoting Good Local Governance as an Enabling Environment for Sustained Growth; and, (3) Accelerating Local Economic and Sustainable Development for Increased Employment Opportunities and Reduced Poverty.
A new element of the PDF WG-DLG 2013-16 Work Plan is the inclusion of a results framework with outcomes and outcome indicators identified for each of the Development Agenda. The results framework is envisioned to play a vital role in monitoring the progress of PDF WG-DLG projects and activities and, more importantly, reaching the goal of inclusive growth.
Development Agenda and Results Framework
Encompassing Goal of the PDP: To attain inclusive economic growth, that is rapid and sustainable, that creates employment opportunities and reduces poverty (PDP)
Development Agenda and Goals
Proposed 2013-16 Work Plan
Improving Local Fiscal Autonomy for Inclusive Growth and Development
Improved local fiscal policies, procedures and capacity
No. of policies/programs/systems adopted on improving local fiscal autonomy (including timeliness/accuracy/integrity of data )
Percentage of local government units (LGUs) adopting programs/systems to improve efficiency in fiscal policies and procedures:
Synchronization of planning (DBM)
Timely release and direct remittance of national wealth (DILG)
Electronic Statement of Receipts and Expenditures (e-SRE) Version2.1 (BLGF)
Electronic Field Appraisal and Assessment Sheet (e-FAAS) (BLGF)
No. of LGUs adopting performance standards for Local Finance Officers
Percentage of LGUs classified by LGFPMS as good revenue generators by LGU type and income class
No. of LGUs with ordinances on updated SMVs following the Philippine Valuation Standards.
No. of LGUs (e.g. Provinces, Cities and Municipalities) with ordinances on updated Local Revenue Codes
No. of LGUs (e.g. Provinces, Cities and Municipalities) imposing and collecting Idle Land tax
Real Property Tax Accomplishment Rate (RPTAR): Actual RPT collections to targeted RPT collections
Percentage of own-source revenues for all LGUs (i.e. Provinces, Cities and Municipalities)
30 cities, 18 provinces
30 cities, 18 provinces
9 cities, 2 provinces
40 cities/ provinces
40 cities/ provinces
30 cities/ provinces
Increased access of LGUs to debt financing
No. of LGUs accessing credit financing
No. of syndicated LGU loans processed
As of March 2013, 134 LGUs have accessed the MDF-SGF.
Approximately, 135 LGUs will access the MDF-SGF.
Promoting Good Local Governance as an Enabling Environment for Sustained Growth
Increased engagement of citizens and Civil Society organizations (CSO) in local governance
Percentage of LGUs with functional Local Development Council and Local Special Bodies citizens’ participation (functionality criteria based on Local Government Code provisions and related guidelines issued by DILG)
Improved transparency and accountability in local operations
Percentage of LGUs passing the Good Financial Housekeeping (formerly Seal of Good Housekeeping) criteria, as contained in the Seal of Good Local Governance (compliance to FDP, COA findings)
Percentage of LGUs meeting benchmarks under the Public Financial Management Assessment Tool (PFMAT)
(SGH CY 2012, w/o ARMM LGUs)
Improved frontline LGU service delivery
Improvement in the LGPMS overall performance index (OPI)
Number of LGUs (provinces, cities and municipalities) adopting a “Citizen Satisfaction Index System”
Accelerating Local Economic and Sustainable Development for Increased Employment Opportunities and Reduced Poverty
Improved LGU competitiveness that encourages business activity
Percentage of total LGUs with streamlined BPLS
No. of LGUs adopting standards for the streamlining of construction and inspection for business permits
As of Dec 2012, only 430 LGUs conform to BPLS standards
100% LGU adopting solutions that conform to BPLS standards.
3.2 Increased inter-local government cooperation for local economic development activities
Increased no. of functioning inter-local cooperation/ alliances established
Adoption of a financing framework for inter-local alliances
No. of Inter-Local Alliances accessing the MDF-SGF Financing Facility
3.3 Increased LGU capacity for Disaster Risk Reduction and Climate Change Adaptation
Percentage of LGUs (of the 18 National Government -identified vulnerable major river basins systems) that have integrated Disaster Risk Reduction (DRR) and/or Climate Change Adaptation (CCA) into their local plans
Of the 18 MRS
Of the 18 MRS
Work Plan: Projects and Activities
Development Agenda 1: Improving Local Fiscal Autonomy for Inclusive Growth and Development
Official Project Objectives2
Expected Outputs / Deliverables
National Government Agencies
Period of Implementation
and Project Status3
Improved local fiscal policies, procedures and capacity
Project/Activity: Deployment of e-SRE System (Version 2.1) to LGUs
To strengthen the capacities of local treasurers to adopt the requirements of the new SRE system
To strengthen the capacities of the BLGF central and regional offices to effectively provide correct and timely guidance to local treasurers in implementing the SRE system
Project/Activity: Promoting Sustainable Use of Natural Resources and Revenues for Social Services Delivery, Poverty Reduction and Environmental Sustainability
To strengthen the capacities of national and local governments including local communities to access and manage assets and revenues from sustainable management of environment and natural resources (ENR) for local economic development;
To increase budget allocation and level of spending for poverty-environment measures in lead agencies, sectoral departments and LGUs;
To improve the capacity of LGUs to integrate pro-poor and environmental concerns into the design and implementation of local development plans and programs;
To establish more efficient processes on the distribution of National Wealth (NW) between national government and LGUs through policy reforms and systems improvement;
To improve transparency of ENR revenues collection and payment, and its utilization by LGUs, and
To increase number of people gaining employment and/or venturing into productive enterprises from sustainable management of ENR, especially from resource extraction activities such as mining, oil and gas, geothermal, etc.
Activity Result: Timely release and direct remittance of ENR revenues to LGUs and increased share of LGUs from the National Wealth
Develop and issue a new Joint Circular to remove hindering factors in the timely collection of ENR revenues and release of the complete LGU share from the national wealth in the processes provided in DOF-DBM-DENR-DILG JC 2009-1 and JC 2010-1.
Organize a network of LGUs hosting extractive industries to lobby for and monitor the timely release of LGU share in the national wealth, and to serve as a venue where all issues on mining and other extractive industries can be raised and discussed.
Review and lobby to amend the Local Government Code of 1991 or RA 7160 for a more efficient and immediate release of LGU share and delivery of basic social services to host communities.
Review and revise Electric Power Industry Reform Act (EPIRA or RA. 9136) and Renewable Energy Act (RA 9513) relative to the Local Government Code (RA 7160), and their Implementing Rules and Regulations (IRRs) to increase LGU shares in the proceeds from energy resources and to utilize the revenue for poverty reduction and environmental sustainability programs
Develop a joint circular between DILG and DOE to provide guidelines for exemptions to the 80% minimum requirement of LGU share in national wealth to be used to lower the cost of electricity, in line with a provision in DOE-DILG Joint Circular No. 98-01
Review and revise the RA9513 IRR provision to further streamline the application and review process for the Development and Livelihood Fund (DLF) and Reforestation, Watershed Management, Health and/or Environment Enhancement Fund (RWMHEEF), and Electrification Fund (EF)
Publish the advocacy paper for increasing ENR-related budgets and disseminate the same to congressional committees, NGAs and other stakeholders
Activity Result: Improved utilization of ENR revenues through mainstreaming P-E linkages in the planning and budgeting system of LGUs
Develop a P-E toolkit (training modules)
Conduct capacity building for LGUs and DILG regional officers on mainstreaming P-E linkages into LGU plans, programs and budget in the 4 pilot LGUs
Conduct a study to integrate Ancestral Domain Sustainable Development Protection Plan (ADSDPP) and CLUP-CDP guidelines and formulate relevant policy guideline, especially toward providing LGU budgets to ADSDPP formulation and implementation.
Study the socio-economic and environmental impacts of resource extraction activities in selected LGUs and provide policy recommendations and other mechanisms to be able to monitor and influence the use of LGUs shares in the national wealth to reduce poverty and promote environmental sustainability.
Align mining company’s Social Development Management Program (SDMP) to LGU’s CDP/CLUP
Compile SDMPs and conduct Cost-Benefit Analysis of selected/pilot SDMPs relative to the poverty and environmental impact of mining operations
Revise the DENR Administrative Order (DAO) 2010-13 to expand the coverage of SDMPs implementation and budget allocation
Activity Result: Transparent collection and utilization of natural resource revenues
Develop a Mining Tax Information Management System (MTIMS) to properly and accurately monitor, document and disclose amount of taxes, fees and charges paid by mining companies/ stakeholders.
Study the legal obstacles to public disclosure of tax payments and collections from extractive industries (at the national and local levels).
Pilot the public disclosure of environment and natural resource revenues collection and payment and utilization in at least five pilot LGUs (Benguet and Surigao del Norte for large scale metallic mines, Bulacan and Rizal for non-metallic and Palawan for oil and gas).
Propose enhancements to the LGU’s e-SRE:
Disaggregation by source of national wealth.
Additional column under the General Fund (GF) to keep track the expenditures of LGUs using their shares from national wealth, and
Recording the expenditures in lines 22 to 30 (categorized by the type of expenditure)
DILG/ DOF/ DBM (UNDP)
January – December 2013
Reviewed existing procedures and practices on the computation and collection of ENR revenues and the release of the share of LGUs from National Wealth;
Reviewed budget allocation and spending for ENR concerns and advocated for increase resources for poverty alleviation and environmental protection;
Advocated for data-sharing and transparency in the collection, distribution and utilization of ENR revenues which led to the Philippines pronouncement to implement EITI;
Proposals to amend laws, improve current inter-agency policies, and enhance information systems with regards to benefit sharing of ENR revenues between the national government and LGUs, increasing the amounts that LGUs receive from NW, and giving them greater flexibility in the utilization of their shares for sustainable development programs were formulated;
Developed guidelines, tools and methodologies on mainstreaming poverty-environment (P-E) linkages in LGU planning, programming and budgeting system, and
Conducted capacity building activities on P-E development linkage planning and management for 4 pilot LGUs, and valuation of mineral products for MGB personnel.
To scale up the adoption of improved systems and procedures on property valuation and taxation
To sustain reforms through policy and legislative action and institutional strengthening
To broaden the foundations for valuation education and professional development
Updating of Schedule of Market Values (SMV) in 10-40 cities/ provinces
Deployment of valuation information systems (Valuation Database and Information System [VDIS]/electronic Field Appraisal and Assessment Sheet [eFAAS]) to 5 LGUs (to include support for system enhancement)
Rollout of the Philippine Valuation Standards (PVS) to 2 national government agencies;
Policy and legislative advocacy for the proposed Valuation Reform Act (VRA)
Development and issuance of policy and operational guidelines on idle land tax
Development of monitoring system on the LGU revenue impact of land administration and management reforms;
Conduct of information, education and communication (IEC) campaign program and gender mainstreaming
Development/enhancement of Compliance Reporting System on property valuation in the LGUs
Development and delivery of valuation education courses and advance training programs, and provision for research grants on land valuation and management
Updating of the Philippine Valuation Standards to incorporate the 2011 International Valuation Standards
Conduct of research and policy studies on land taxes and fees
Enhancement of computerized systems to support revenue generation management requirements of LGUs
Capacity building support for BLGF regional offices
DOF-BLGF (LAMP - WB/REGALA_ADB)
July 2013 – June 2016 (WB LAMP2 Additional Financing)
For processing: ADB TA (Follow-on/Expansion of Support to Local Government Revenue Generation and Land Administration Reforms)
Project/Activity: Policy Review of the Local Government Code
To propose legislation to improve the fiscal capacity of LGUs
Draft separate bills on the following:
Increase of revenue shares
Boost LGUs Motor Vehicles User Charges (MVUC) shares
Sharing of information with BIR-LGU
Widening tax base of LGUs and remove some tax exemptions
Review of the expenditure and revenue assignments, fiscal transfers and borrowing powers of LGUs
DILG/ DOF-BLGF (ADB)
Project/Activity: Harmonization of LGU Computerized Tax/Revenue Administration System
To enhance minimum standards of computerized tax/revenue administration system and eventually develop and/or enhance an existing system for property assessments and taxation functions to be deployed to interested LGUs
Enhanced minimum standards of computerized RPTA and BPLS systems
Developed or enhanced an existing system for RPTA and BPLS
DOF-BLGF / DILG/ DBM /NCC (EU)
July 2014 – June 2016 (OPE2, OPE3)
Project/Activity: Setting Up of Baseline Data and Monitoring System on LGU Impositions under Local Revenue Codes
To establish baseline data/information and monitor LGU impositions under Local Revenue Codes
Established monitoring system and baseline data on Local Revenue Codes
DOF-BLGF / DILG (EU)
May 2013 – June 2014 (OPE1)
Project/Activity: Enhancing Governance, Accountability and Engagement4
To improve capacity of LGUs in six conflict affected areas of Mindanao to generate own-source revenues
LGUs generating their own-source revenues
April 2013- April 2018
Improved access of LGUs to debt financing
Project/Activity: Capacity Building on Debt Management
To provide framework for LGU borrowings and guidelines to the proper management of new and existing debt
Printed and distributed debt management manual
Conduct of capacity building trainings to LGUs
DOF-BLGF/ DILG (EU)
May 2013 – June 2014 (OPE1)
To improve, automate and link MDFO finance and technical operations
Partially completed; for presentation and test-run to MDFO management.
To provide MDFO technical expertise for the enhancement of the current financing facility; re-alignment of the subprojects and process of loan availment and approval.
To provide MDFO technical expertise for a possible new financing facility, existing programs and policies.
Provided technical advisory services to MDFO for policy formulation and review of:
LGU Financing Policy Framework
Assessment on the Implementation of the Performance-Based Incentive Policy (PBIP) and the Performance-Based Grant System (PBGS)
Creation of new financing windows that are aligned with current administration’s thrusts
Project/Activity: Sub-national Debt Policy TA
To strengthen the capacity of the national government, particularly the Bureau of Local Government Finance, to enhance the regulation of local government borrowing
Strengthened Sub-national Debt Monitoring Systems: Develop and implement an operating system for monitoring sub-national debt
Strengthened Regulatory Framework for Sub-national Debt: Develop specific and actionable policy recommendations for comprehensively strengthening the effectiveness and efficiency of the fiscal rules and regulatory framework governing sub-national debt, including relevant provisions of the Local Government Code as well as requirements instituted by national oversight bodies such as BLGF and the Monetary Board.