Ban Officials from Claiming Government Projects

President PNoy Aquino said that he supports Senator Escudero’s Senate Bill 2187 which prohibits the naming of government projects after officials. And he went on to declare that he does not want to have any project named after him. This is a good sign.
Actually, Escudero’s bill is only the latest Senate attempt at curbing this practice. In 2004, Senator Miriam Defensor Santiago proposed Senate Bill 1967, which will penalizes the attaching of the name or image of any public official to a sign announcing a proposed or ongoing public works project. It was not passed by the 13th Congress, so Santiago reintroduced it in 2007, in the 14th Congress, and it still didn’t pass.
Santiago’s SB 1967 bill penalizes officials who do attach their name or image to a project, to 6 months to 1 year in prison, and to permanent disqualification from running for public office. Escudero’s SB 2187 penalizes the offenders with 1 year imprisonment and a fine from Php100,000 to Php1,000,000.

Corruption
The practice of claiming government projects as “theirs” by government officials is not only irritating, it is also a waste of money. And, more importantly, it is a form of corruption. After all, these officials use public funds and projects for personal gain. It is a form of free advertisement for themselves, as a sort of advanced election campaign. Even if no additional funds are involved (i.e. the sign would have been put up anyway), it is still corruption. And, if it involves additional expense for the government, it becomes even worse.

Congressmen seem to need to show off where their pork barrel allotments go to. Let them just show them in their websites (or the websites of the Dept of Local Government, or that of Congress), where they could publish what projects got funded by their pork barrel funds. This would have the additional advantage of increasing transparency in the allocation of pork barrel.

Just like the anti “Wang Wang” drive of the government, a ban on claiming government projects will go a long way towards changing the general atmosphere that leads to corruption. It will be a small, but quite visible (or should we say, “invisible”) step in the right direction.

Provisions
Let us go to the provisions such a law should have. In the first place, I think the law should specify by the claim ban. Billboards explaining the project is one way, but there are others e.g. words painted on a waiting shed, or the name of the project is similar to the politician’s name, or words printed or attached to a label of a product (e.g. school bags given to children). The ban should cover all these.

Then, the punishment for violating the ban should not include imprisonment. I think that would be too harsh, and may have a counter-productive effect, i.e. people would not complain of violations, because they think that imprisonment is too harsh. The punishment should include: a big fine, suspension from office for 6 months to a year for the first offense, and expulsion from office plus a permanent prohibition from public office for the second offense. I think this should be fair enough to be upheld.

And the government should also allot money to “erase” all claims on projects by government officials. Waiting sheds may need to be painted over, projects may need to be renamed, etc.

I think President PNoy should include this bill among the priority bills that he will push Congress to pass.  Then, passing it through Congress becomes a possibility. Otherwise, if he doesn’t signify it as priority, it will not pass; since many lawmakers like to claim government projects.  And, if the president doesn’t think it should go through as a bill, he could adopt it as an Executive Order, which although faster, would also be less effective than a law.

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Combatting Corruption in the Philippines

All eyes are now on Noynoy Aquino, who ran on an anti-corruption platform and won the presidency. Now he has to get going and start fighting corruption. But his task is big, very big.  So, where should Noynoy start? How is he to address such a widespread problem?

Wealth Recovery over Conviction
I feel that the fight against corruption should mainly be about recovering ill-gotten wealth. And secondary to this would be the incarceration of those who are corrupt. I say this because I feel that the government tends to take the route of filing a criminal complaint against those suspected of corruption; which takes so long to finish, and which actually limits the government’s ability to tackle the widespread corruption in the country. Instead of taking the “legal” approach to corruption. I will suggest the “administrative” approach should be taken. Take the money back, put them in a black list for government jobs and contracts, and that’s all. No need to put anyone in jail, if the money is returned.

Government Machinery
I suggest that a special anti-corruption task force be formed to check the whole government bureaucracy and handle the complaints from citizens.  This could be made up of  officials from the Commission on Audit, the Civil Service Commission, Dept. of Local Government, and other bodies.  This task force will do its job independent of the Ombudsman’s office. It will concentrate more on “life style checks”, and on checking to see if contracts are not disadvantageous to the government; the Ombudsman could still concentrate on filing cases against officials accused of corruption.

To help make sure that the anti-corruption task force is itself not corrupt; perhaps there should be two of these, and they should also check each other.  Also put in some students, members of cause oriented groups, to help keep them honest. And then give the team members specific term limits.

And the government should also beef up its judiciary – a lot more fiscals and judges would need to be designated to handle the increased case load. Of course, this should be preceded by a thorough check of judges for their honesty.

Citizen Whistleblowers
In order to fight corruption, the government will need to be aided by “citizen whistleblowers” who would expose the corrupt officials. And by “expose”, I do not mean just accusing anyone left or right, but by presenting documentation or proof of corruption – either by the “life-style check” approach, or by the “transaction” approach. By the life-style check approach,  I mean that the citizen could prove that the official could not have earned the money needed to buy all the things he owned; and thus must have earned it through illegal, corrupt means.  And by transaction approach, I mean that the citizen could prove that kickbacks or other corrupt practices occurred.

And the reason that citizens would come forward with well-documented charges of corruption is that there would be reward that would be taken from the confiscated property. Let’s say that the government would offer citizens 5% of the confiscated property, tax-free, for evidence that will lead to the confiscation of a corrupt official’s property. This should be incentive enough for many to try and expose people.

The whistleblower should present real evidence, though, in order to avoid that innocent people get accused. There should be receipts, documents, photos, etc. presented as proof. The citizen – whistleblower should be able to present his case through the internet – giving him full anonymity.  There will be a lot money to earn by exposing corrupt officials, and I expect that there will be a lot of submissions.

Reduce IRAs of “non-performing” LGUs?

On 8 February, Noynoy Aquino proposed that the Internal Revenue Allotments of  Local Government Units (LGUs) which do not do their work well should be trimmed down. It’s a nice thought, coming from the idea of reducing waste in government expenditure. The problem with it, however, is that to do so would mean an increase in the president’s prerogatives, of which he has already too many. And if the president will be the one to decide which LGUs to cut the IRAs of, he could very well reduce the IRAs of provinces, cities or municipalities ruled by the opposition.

The Local Government Code, which among other things, provides for the Internal Revenue Allotments of LGUs, also provides for the automatic release of these funds. And with reason. This is to prevent national government tinkering with these funds in order to control the LGUs. I think it is a good idea for the release of these funds to be automatic.

Perhaps it would be a good idea to set up rules (or even pass a law amending the Local Government Code) which would spell out what it means to have a “non-performing LGU”, and then to prescribe exactly how much IRA reduction that will be imposed on it, and what the LGU needs to do to get its allotment restored. This way, the reduction of IRA will go about in an automatic way – that is, devoid of “presidential prerogative”.

Looking into the Local Government Code provision on IRAs, it specifies that the  allotment per LGU is determined on the basis of 50% population, 25% land area, and 25% equal sharing – this, after the initial division of the total internal revenue taxes by: provinces (23%), cities (23%), municipalities (34%) and baranggays (20%) . Now, I see the 25% “equal sharing” as unfairly benefitting small, less populous LGUs.  I suspect that many of the “not well spent” IRAs is connected to this amount given to small LGUs. Why not just eliminate this item altogether? And then make the division into 2/3 population, and 1/3 territory. This would make the allotments go more to the more populous and bigger LGUs who actually need more of the money, and perhaps are finding it hard to finance all their expenses.

And perhaps the IRA amounts should be published by the government on the internet,  as a step towards transparency. This way, the IRA amounts will be known to be public. Of course, it would be best if the full accounts of LGUs  also be on the internet.

No New Taxes?

Noynoy Aquino promised, during a speech before the Makati Business Club on 21 January 2010 that he will not raise taxes as president.  This is a nice promise, but unfortunately, I don’t think that Aquino, nor any president for that matter, could possibly keep such a promise.

Congress
In the first place, it is Congress that decides to raise taxes, and not the president or the executive branch. When the Congress deliberates on the budget, they also deal with taxes (usually small ones); the budget is such a complicated and involved bill that when they agree on it, it is the result of such a long process of deliberation and compromises. When the budget comes to the president for signing, and it  has a few tax increases, it will be extremely difficult not to sign. Not signing may mean that the budget has to be deliberated on again, and that the first few months of the following year would be without a new budget, etc. Thus, the president may really have to sign such a budget.

Adjustments
Then, there are the adjustments made to taxes on a regular basis. For example, some excise taxes are regularly adjusted to go with inflation. Thus, an excise tax on say alcohol, will have to be updated if the price of alcoholic beverages rise. Or, in the course of negotiations with other countries, it may be necessary to change some taxes from excise to ad valorem (excise is a specific amount in pesos per unit to be taxed, will an ad valorem tax is based on the price of the unit to be taxed) or vice-versa, or to raise some taxes and lower others. When this happens, the overall tax burden may remain the same, but specific individuals may experience an increase in their taxes, while others experience a decrease.

Also, if the national government decides to cut down on subsidies for some services at the local level, this may push the LGUs to raise some of their own taxes to recoup the added expense. In a sense, the national government raised local taxes.

Overall impact
Of course, if the “no new taxes” promise is taken to mean: “I will not increase the overall tax burden.” this become more feasible. This means that increases in some taxes will be offset by decreases in others, so that the overall effect will be the zero. This means that the government will seek other ways to generate money – e.g. through more economic growth – than taxing the people.

The idea behind Aquino’s no-new-taxes policy is that enough money could be raised through efficiency in government and tax-collection. And though this is a good idea; it’s just not an absolute thing. I don’t believe it is a good idea to tie down the president to a “no new taxes” policy, since taxes are inevitably part of the arsenal of instruments open to the president.   If good government requires that some taxes go up, then so be it. Just make sure that it is done fairly and that it really is the last resort.