Monday, September 16, 2019

Sanchez: IRA addiction: Federalism, 2

SENATOR-ELECT Juan Miguel Zubiri was in town recently, bringing the message of a federal government to the Negrenses. Zubiri said the target under the Rodrigo Duterte administration is to shift the present form of government from a unitary to a federal form of government.

The come-on for support from local government units to shift to a federal state is that they can retain most of their revenues.

During the campaign, President-elect Rodrigo Duterte has proposed a federal system in which regions keep 70 percent of their income and send only 30 percent to the central government.

Sounds enticing. What are the facts to show that this proposed set-up is advantageous over the current one?

Last year, Negros Occidental was set to receive a total of P11.07 billion in internal revenue allotment (IRA) funds, while Negros Oriental would get a total of P5.86 billion, according to the Department of Budget and Management.

Compare that to revenue generation of both provinces. According to the Commission on Audit, Negros Occidental generated an income of P2.2 billion in 2013—making it among the richest provinces in the country—while Negros Oriental earned P1.4 billion.

Are both provinces willing to trade off their P16.93 billion IRA so they can retain most of the P3.6 billion revenues? I don’t think so. I’m used to facilitate interest-based negotiations in court-annexed mediation. From where I sit, the exchange for revenue generation doesn’t sound exciting.

In fact, LGUs have IRAs in the past five years, received estimated annual increases of between 10 percent and 15 percent in their IRAs from 2010 to 2015, said the League of Municipalities of the Philippines.

Former pop singer Jaime Garchitorena and currently the President and CEO Credit Information Corporation put it this way: “I’m also looking forward to seeing some of the mayors and governors who have gotten so used to asking money from central government finally have to deal with the fact that they’re really not smart enough to be an executive of anything.”

He added, “that if they can’t generate revenue, they won’t be able to ask National Government for help.”

If anything, local executives will no longer be able to ride the IRA gravy train. Revenues will no longer automatically come as manna from the Manila. As Genesis 3:19 said, “By the sweat of your brow you will eat your food until you return to the ground, since from it you were taken; for dust you are and to dust you will return.”

If that means local executives (mayors and governors) will be compelled to fund raise to get their government projects off the ground, why, I’m all for a federal form of government. That means candidates who can’t hack it will be weaned from our political leadership.



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