WB lays out Mandanas policy recommendations

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Sumary of WB lays out Mandanas policy recommendations:

  • Addressing inequality in financial resources among local government units (LGUs), improving the capacity of LGUs, and enhancing transparency and accountability are key to improving decentralization as the country starts implementing the Mandanas ruling in 2022..
  • In a virtual forum on Thursday, the World Bank said the Mandanas ruling is the first step towards strengthening decentralization and improving local service delivery but improving coordination, strategic planning and budgeting are needed to address implementation challenges..
  • “On the part of the World Bank, we look at the implementation of the Mandanas ruling not just as a transfer of resources and responsibilities but as an opportunity to strengthen decentralization and social delivery services in the Philippines,”.
  • This expanded revenue coverage means the IRA share of LGUs should also include other taxes such as those collected by the Bureau of Customs (BOC)..
  • “As a result of the Mandanas ruling, the IRA in the 2022 national budget is programmed to reach 55 percent, reaching P1.08 trillion or 4.8 percent of GDP compared to 3.5 percent of GDP in 2019..
  • The World Bank added that underspending by local governments may worsen, as many local governments do not have the capacity to absorb a significant increase in revenues..
  • World Bank Economist Kevin Cruz said addressing weaknesses in planning and coordination is a first step towards managing the transition and improving decentralization..
  • “The national government should clearly define re-devolved functions and communicate these clearly to both national government agencies and local government units,”…

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