ECONOMIC managers told the Senate that a Supreme Court ruling expanding the share of local governments in national government revenue has led to ongoing discussions about the scaling back of certain national government projects.

At a briefing by the Development Budget Coordination Committee (DBCC) before the Senate finance committee, acting Budget Secretary Wendel E. Avisado said the impact of the court ruling has triggered a review process for which projects need to be scaled down. The process is currently ongoing.

In Mandanas vs. Ochoa, the Supreme Court ruled that under the Local Government Code, which took effect in 1991, local government units (LGUs) are entitled to a share of the national government’s revenue, payments which are known as Internal Revenue Allotments (IRAs). It also found that the national government has from the start been excluding Customs revenue from IRA computations. It ordered the national government to correct its computation method and make up the arrears from 1992 to 2012, starting with the 2022 budget cycle.

The petitioner, former Batangas governor Hermilando I. Mandanas, initiated the case in January 2012, when he was a member of the House of Representatives for the second district of Batangas.

Mr. Mandanas claimed that LGUs are owed around P500 billion, covering underpayments of the IRA between 1992 and 2012, because Customs revenue was left out of the computation.

Senator Ana Theresia N. Hontiveros-Baraquel said “the negative fiscal impact on the national government’s disposable cash (is a reduction of) around P250 billion just for 2022.”

At the hearing, Sen. Panfilo M. Lacson noted the low priority given to the science and technology sector.

“Bakit ang baba ng appropriation natin sa S&T (Science and Technology)?” Mr. Lacson said (Why are S&T appropriations so low?) He said out of 129 countries, the Philippines ranked 54th in the Global Innovation Index 2019.

Sen. Juan Edgardo M. Angara, the committee chairman, said lack of support for the sector reflects in the country’s performance.

“Talagang kulang-kulang tayo dyan (We have our shortcomings there), which explains why our product offerings are very low, our incomes are very low, walang (there is no) innovation.”

National Economic and Development Authority (NEDA) Undersecretary Rosemarie G. Edillon said the agency is seeking to improve the sector, beginning with the Philippine Development Plan.

“This is the first time that the Philippine Development Plan (will) actually include a chapter (on) science, technology and innovation,” she said.

“The first thing that we want to find out is exactly ano nga ba ang problema ng S&T natin (what are the problems of S&T) and so we started looking at strengthening the science, technology and innovation ecosystem.” — Charmaine A. Tadalan

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