MANILA, Philippines?Federalism. Local autonomy. Devolution. Bangsamoro Juridical Entity (BJE). These issues have grabbed the headlines with the proposed and aborted signing of the memorandum of agreement (MOA) with the Moro Islamic Liberation Front (MILF). The proposed setting up of the BJE has been seen as a serious threat that would lead to the dismemberment of the Philippine State.

There have also been parallel and emerging discussions on the proposal to set up a federal system in the Philippines, one that has been given prominence with the recent visit of the President of the Swiss Federation. It was on that occasion that President Macapagal-Arroyo reiterated her call for the adoption of a federal system in the Philippines.

In order to better understand the issues being raised in connection with the MOA and federalism, it is important to locate the debate within the context of the continuing demand for autonomy and decentralization among subnational institutions and local governments, including the Autonomous Region in Muslim Mindanao.

Resistance

The demand for autonomy among Muslim communities in southern Philippines is as long as the history of the country itself. There has always been resistance among our Muslim-dominated communities to being ruled by the Manila-based Christian leaders.

Philippine politico-administrative history will show that resistance to the central authorities was not only among the Muslim dominated communities, but also among the many subnational political institutions, from the many local governments in Mindanao to those in the Visayas?Cebu and Bohol were among the most vocal?to the Bicol region in Southern Luzon and the Cordilleras in Northern Luzon.

Looking at the ?question behind the question,? what all these manifest is a continued frustration among lower level institutions with current arrangements that perpetuate domination by ?imperial Manila.? Why should authorities based in the national capital decide on matters that they feel are purely local?

Subsidiarity

One way to address this question is to set up appropriate politico-administrative institutions that will enable more policies, programs and projects to be more responsive and appropriate to local needs in accordance with the principle of subsidiarity: services should be provided by the lowest level of government that can do so efficiently.

What runs across the discourse of devolution, federalism and the BJE is the continuing demand for autonomy and the right to chart one?s development path. They only differ in terms of degrees of autonomy and extent of power of the subnational institutions.

The following continuum illustrates this:

Deconcentration?>Devolution?>Regional autonomy?>Federalism?>BJE?>
Separation

The continuum illustrates the extent to which power and authority are transferred or vested in subnational government. One can see that federalism is the logical step after devolution. Given the Philippine context, federalism will enhance the autonomy of local governments.

Depending on the needs and negotiations between the federal and state governments, there will be responsibilities that will belong exclusively to the federal government (such as foreign affairs, defense and currency); powers that will belong exclusively to state governments (such as social services, agriculture and health); and there will be those that will be shared (such as environment, education and trade).

Separatism

A look at the proposed MOA between the government and the MILF will reveal that it is a step farther from federalism and may even lay the groundwork for outright separation.

Some of the provisions should be further examined and placed within the context of a sovereign Philippine republic. To what extent will the sovereignty of the republic be compromised in giving special recognition to the BJE? Of course, the more fundamental concern relates to the constitutionality of the proposed MOA.

This has been addressed and debated by many sectors, including the legislature, judiciary and civil society. Serious concerns have been raised ranging from the lack of transparency and consultation with the people concerned to the potential dismemberment of the republic. The MOA has since then been junked by the administration.

Indeed, the debates surrounding the MOA, the BJE and federalism are all related to a more fundamental concern?recognizing the autonomy of subnational institutions. This is essentially what decentralization is all about. The decentralization process initiated by the Local Government Code of 1991?largely through the efforts of Sen. Aquilino Pimentel Jr.?unleashed tremendous potentials in the countryside long held hostage by a highly centralized politico-administrative system based in Manila.

We have seen how hundreds of local governments have responded to the challenges of rural development under a regime of devolution and local autonomy. The many local government awardees of the Galing Pook Awards Program?ranging from Marikina to Naga, from Malalag in Davao to Dingras in the Ilocos?are testimonies to this. This is hope at the local level. In spite of the national government, devolution has provided the enabling environment.

It has been 17 years since decentralization was implemented in the Philippines through the enactment of the Local Government Code. It is imperative to learn from the lessons of history even as we seriously embark on deepening local autonomy through various politico-administrative institutions and structures, including the adoption of a federal form of government.

Some of the major issues, concerns and trends raised over the past decade and a half have been in the following areas: (1) local government finances; (2) performance measures and indicators for local governance; (3) interlocal and intergovernmental cooperation; (4) harnessing civil society and private sector participation; (5) evolving role of national government agencies; (6) leagues of local government units; and (7) federalism as the next logical step after devolution.

These issues may also prove to be illustrative in the analysis of and proposals for a federal structure of government, and the continuing search for appropriate subnational structures and processes that will be responsive to the needs of the people.

Local government finances. Devolution without financial decentralization is not meaningful.

One of the highlights of the Local Government Code was the transfer of financial resources to local governments through a mechanism called the Internal Revenue Allotment (IRA). However, while the financial resources of local governments substantially increased, experience showed that the amounts transferred were not sufficient to generally cover the costs of devolution.

Thus, the need to re-examine the IRA formula and include other factors such as poverty and performance into the allocation formula i.e. the more poor people in the area the more should be its share, and IRA allocation should be linked to performance, especially in terms of its tax collection efficiency and ability to raise revenue.

Performance measures and indicators. An innovative way of measuring performance is the Local Government Performance Measurement System of the Department of Interior and Local Government (DILG).

This measurement system focuses on five major areas: governance, administration, social services, economic development and environmental services, which shall be the basis of local government reports and would serve as a guide in the design and implementation of development programs and projects, including capacity-building interventions and assistance. This major development, however, has to be further strengthened.

Philippine local governments should take inspiration from other successful international practices such as the Bangalore Report Card system that has been replicated in other parts of the world.

Interlocal and intergovernmental cooperation. The next logical step to local governance is a formal amalgamation in contradistinction to fragmentation.

Local governments may enter into interlocal cooperation in the delivery of services and performance of functions that cut across political and administrative boundaries?from solid waste management to common environmental and ecological concerns to interlocal health zones and trade-based agroindustrial zones.

Nascent interlocal partnerships have been proven effective in the cases of Metro Naga, Baguio, La Trinidad, Itogon, Sablan and Tuba in the Cordilleras, the Cagayan de Oro-Iligan Corridor, Camanava (Caloocan-Malabon-Navotas-Valenzuela), Cala (Calamba, Laguna), the various provincial and intermunicipal agroindustrial initiative of municipalities in Davao, among others.

There also have been successful cases of political amalgamation, say that of the Island Garden City of Samal that grouped five municipalities on the island, and Sorsogon-Bakon that saw the political merger of the city of Sorsogon and municipality of Bakon in Sorsogon province. These cases should be carefully studied and documented, if only to stem the unfortunate trend among provinces that move in the opposite direction, that of fragmentation.

Oppose gerrymandering

Apart from being costly (creating new LGUs is a very serious matter considering the implications and tremendous administrative overhead involved), many of the proposals for fragmentation smack of a variation of gerrymandering. This trend should be resisted and instead, consolidation, interlocal cooperation and even amalgamation should be encouraged for more efficient, responsive and effective local governance.

Civil society participation. Active civil society participation in local governance has led to a redefinition of the notion of governance, one that goes beyond the formal structures and processes. This has been proven successful by the Gawad Kalinga model and approach to governance?an excellent example of civil society-led governance in the delivery of housing at the local level. GK has successfully managed to bring the resources of government, business and civil society in addressing the major problem of squatting and homelessness at the local level. The GK model can be replicated by other local governments and should be supported.

Private sector participation. LGUs have become more open to seeking out partnership with the private sector for effective governance: privatizing utilities, floating bonds, entering into build-operate-transfer agreements, etc. Innovative-resource mobilization and revenue-generation practices through such arrangements have been carried out by LGUs like the provinces of Bohol (privatization of water and electricity), Aklan (bond flotation), the cities of Mandaluyong, Makati, Quezon and the municipalities of Victorias in Negros Occidental and Dingras in Ilocos Norte.

Evolving role of national agencies. The DILG plays a critical role in the devolution process. Within the context of the ?steering-vs-rowing? philosophy and in support of local autonomy, efforts could be made to emphasize its role in capacity development and institution building. The DILG could take the lead in networking and partnering with local and international institutions, with the goal of sustaining their work and transferring appropriate technologies, as well as providing the linkage between sectoral departments and LGUs (as it has say in the oversight committee).

From capacity building to capacity development. To respond to issues and concerns such as the ?lack of capabilities? and poor ?absorptive capacities? of LGUs, efforts were made to develop and implement various training and capability-building programs aimed at improving the skills of individual local officials and employees. While these training programs are useful, it is imperative to expand ?capability-building-and-training? paradigms to general ?capacity building? and ?capacity development? that would go beyond developing individual skills so as to enhance local government institutions, structures and processes.

Leagues of LGUs. Various leagues of local government units (Leagues of Provinces, League of Cities, League of Municipalities and the Liga ng mga Barangay as provided for in the Code) have played a key role in advocating the cause of local autonomy. The League of Vice Governors, Vice Mayors League, Philippine Councilors League and National Movement of Young Legislators have consolidated their forces into the Union of Local Authorities of the Philippines.

The leagues have indeed gone a long way. They are at the forefront of resisting unfunded mandates that tend to distort development efforts and of proposing major amendments to the Code like reforms in the allocation of the IRA. They have entered into strategic alliances with like-minded sectors of society.

Federalism next step to devolution. Federalism as an option should be considered to fully operationalize local autonomy and devolution in the country. There are discussions, not only in the Philippines but also in other Asian countries, on adopting the federal system. Some argue that federalism is the next logical step after devolution.

In the Philippines, advocates of federalism believe that the structure of the federal system will respond to the geographical obstacle and differences caused by cultural diversity on governance because it allows fragmentation while at the same time promoting national interest. It is also claimed that the federal structure will accelerate the country?s development and end the internal conflicts brought about by separatist movements in Mindanao.

It is therefore noteworthy that the President recently issued an executive order to seriously study the federalism option. The proposal of Pimentel in the Senate is likewise an opportunity that should be seized.

This should be seen as an occasion to enlighten all sectors about the merits of federalism and perhaps, more importantly, how the adoption of a federal system will further strengthen local governments and thus enhance decentralization for the improvement of the delivery of basic services. Many times, opposition to federalism is rooted in the lack of information and understanding.

(Alex B. Brillantes Jr., PhD, is the dean of the National College of Public Administration and Governance, University of the Philippines, Diliman, Quezon City.)