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Abad urges LGU execs to support Aquino’s Social Contract amid lower IRA for 2012

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Budget and Management Secretary Florencio Abad urged local government officials to align their programs and projects with the Aquino administration’s priority areas amid the lower Internal Revenue Allotment (IRA) for 2012.

Abad said IRA of LGUs in 2012 would be lowered because of the same situation in revenue collection in 2009 on account of the downturn in the global economy and the revenue-eroding measures passed that year.

“Year after year, we, in the Department of Budget and Management have followed the provisions of the Local Government Code on the share of LGUs in national internal revenue taxes, with no exception. It is unfortunate that revenues in 2009 declined, but that is the legally-mandated base year for computing the IRA for fiscal year 2012,” he said.

Under Section 284 of Republic Act No. 7160, otherwise known as the Local Government Code of the Philippines, LGUs shall have a 40-percent share in national internal revenue taxes “based on the collection of the third fiscal year preceding the current fiscal year.”

For 2012, the base fiscal year for the IRA is 2009 and the allocation amounts to P273.31 billion. This is 4.8 percent lower than this year’s P286.94 billion allocation.

Abad said LGUs were mandated by law to put in at least 20 percent of their IRA for development projects.

He said LGUs could co-finance with the national government for the construction of vital infrastructures like school buildings, rural health centers, and infrastructure that supports agriculture and tourism.

Under Aquino’s Social Contract with the people, the administration vowed to focus its projects on anti-corruption, transparent, accountable and participatory governance; poverty reduction and employment of the poor and vulnerable; rapid, inclusive and sustained economic growth; just and lasting peace and the rule of law; and integrity of the environment and climate change adaptation and mitigation. (Joann Santiago - PNA/PIA9-BST)




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