LGUs’ IRA rose in the last 5 years – LMP

Reynaldo Santos Jr
LGUs’ IRA rose in the last 5 years – LMP
The League of Municipalities of the Philippines (LMP) appreciates the annual increase and undelayed release of their internal revenue allotments (IRAs) under the Aquino administration

MANILA, Philippines – Local government units have been enjoying huge increases in their internal revenue allotments (IRAs) in the past 5 years, according to the League of Municipalities of the Philippines (LMP).

LMP executive vice president Germy Singson Goulart said in a statement released on Sunday, June 28, that LGUs have received estimated annual increases of between 10% and 15% in their IRAs from 2010 to 2015.

Goulart, also the mayor of Caoayan town in Ilocos Sur, explained that the IRA jumped from P249.99 billion in 2009 to P265.80 billion in 2010, and has been increasing ever since:

  • P286.94 billion in 2011
  • P273.31 billion in 2012
  • P302.30 billion in 2013
  • P341.54 billion in 2014
  • P389.86 billion in 2015

Goulart added that the IRA is expected to hit P 428.619 billion next year.

The IRA for a current year is computed based on the national government’s gross internal revenue collection 3 fiscal years earlier, as prescribed in Section 284 of the Local Government Code.

“The Aquino administration scores consistently high on this steady increase because of its sound fiscal management,” Goulart said. He added that previous administrations “had withheld the IRAs and unduly punished LGUs” because of unmanageable fiscal deficits. (READ: Did budget dep’t withhold LGU funds in 2013?)

The higher allotment for LGUs is in line with the position stated by Aquino during the presidential campaign. He said LGUs could get higher amounts of IRA through efficient tax collection on the part of the national government, and there wasn’t necessarily a need to increase their percentage share in the BIR collection.

Under the Local Government Code, 40% of BIR’s annual collection goes to LGUs. The amount is divided thus: 23% for the provinces, 23% for cities, 34% for municipalities, and 20% for barangays.

Within each level of local government, the shares are distributed this way: 50% according to population; 25%, land area; 25%, equal sharing. Allocations for barangays, on the other hand, are determined through population (60%) and equal sharing (40%).

No delay in release

Goulart also highlighted the timely release of the annual IRA in the current administration.

“I have never experienced that our IRA shares were delayed, withheld or impounded in the last 5 years, including in 2013. Figures do not lie, and I am happy that our IRAs were always released on time by the budget department,” he said.

Every month, 80% of the IRA is released before or on the 8th day, while the remaining 20% is released on the 24th day.

In one instance – after Typhoon Yolanda hit the country in 2013 – the Department of Budget and Management (DBM) even promised to release IRA shares of LGUs in the worst-hit region one week ahead of schedule.

Mayor Edwin Alibutdan of Ipil, Zamboanga Sibugay also recognized the ability of the Department of Budget and Management (DBM) to inform LGUs of their allocations one year in advance, and to set the automatic monthly releases of their shares so as not to derail local budgeting program and expenditures.

This advanced notice, Alibutdan added, “provided a sense of stability and dovetailed with local budget preparations that gave municipalities enough time before submitting their budget for approval by the Sanggunian Panlalawigan.”

LMP released this statement days after Vice President Jejomar Binay claimed in his speech that the Aquino government, through the budget department, withheld the IRA in 2013. (READ: Did budget dep’t withhold LGU funds in 2013?

The 2013 report of the Commission on Audit (COA) revealed that the LGU allotments “were not automatically released to LGUs but maintained under DBM Administered Funds (Fund 103) in violation of Section 6, Article X, General Provisions of the 1987 Philippine Constitution.”

Budget Secretary Florencio Abad, however, claimed that “there was no violation of automatic release” in this incident. – Rappler.com

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