LGUs told to build fiscal resilience, stimulate local economic growth

Finance Secretary Benjamin Diokno urged local chief executives in Samar and Leyte to build the fiscal resilience of their respective local government units (LGUs).

“Now that we are emerging from the pandemic, you must lead our LGUs in building fiscal resilience while stimulating the growth of our local economies,” said Secretary Diokno at a gathering of Samar and Leyte mayors.

Secretary Diokno emphasized the growing importance of sound local government finance as the revenue share of LGUs has increased with the implementation of the Supreme Court ruling on the Mandanas-Garcia case.

“You are now primarily responsible and accountable for the provision of basic services and facilities fully devolved to LGUs. With this expanded mandate, you must lead your local governments in improving revenue collection and resource mobilization to attain fiscal sustainability and genuine local autonomy,” Secretary Diokno elaborated.

At the height of the pandemic, LGUs assumed an expanded role in the delivery of public services to their constituents, including the most vulnerable sectors. As a result, the health crisis had a significant impact on the fiscal resources of many localities, said Secretary Diokno.

To further strengthen the capacities of LGUs in the area of local treasury and assessment operations, the Department of Finance’s Bureau of Local Government Finance (BLGF) continues to provide LGUs with capacity building and development interventions.

For instance, the BLGF is conducting the Standardized Examination and Assessment for Local Treasury Service or SEAL program.

According to Secretary Diokno, the SEAL program aims to professionalize and modernize the local government treasury service.

Secretary Diokno urged LGUs to quicken the digitalization of their respective bureaucracies, especially in local revenue collection, to boost overall tax effort, improve the ease of doing business, and eliminate discretion.

He said that building up the fiscal health of LGUs is critical to the Marcos administration’s bid for a faster, greener, and more inclusive economic growth.

“Our local government units stand at the frontlines of national development. Now more than ever, the Filipino people will rely on our LGUs as the country moves toward a sustainable recovery and rapid inclusive growth,” said Secretary Diokno.