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Role of LGUs in the Delivery of Quality Basic Education
Department of the Interior and Local Government
Outline of Presentation
Role of LGUs on Basic Education Special Education Fund
Legal Basis for Utilization
Current Practice on Allocation of SEF
Local Special Bodies Functions and Composition
Challenges and Recommendations Reform SEF and LSBs to support education Increase SEF collection via updating SMV
Context: why good education matters
• Educational attainment of household head is important determinant of poverty status of HH.
• Poverty incidence is found to be higher among households with household head with lower educational attainment.
Poverty incidence
Contribution to total # of poor HHs
No education 53.9 5.7Some elementary 43.3 36.3Elementary graduate 35.3 25.4Some high school 29.5 13.9High school graduate 17.2 14.4Some college 8.1 3.7College graduate 1.6 0.6ALL HHs 26.9 100.0
Educational attainment of HH head and poverty incidence, 2006
Role of LGUs in Basic Education
Basic public education – still largely responsibility of central government, delivered through DepEd
With devolution policy, providing for basic education is shared with LGUs. Basic services and facilities assigned to LGUs include school
buildings and other facilities for public elementary and secondary schools (LGC, Sec. 17)
LGUs provide supplementary finance for public basic education thru SEF which are the proceeds of 1% additional tax on real property (LGC, Sec. 235)
LGUs have the means to contribute to the improvement of basic education outcomes through more efficient
and effective use of the Special Education Fund (SEF).
Special Education Fund (SEF)
Special Education Fund (SEF)OVERVIEW/LEGAL FRAMEWORK(LGC Section 235 and Sec 272)
SEF are proceeds from the additional one (1%) on the assessed value of real property tax which shall be in addition to the basic real property tax impost by provinces or cities, or a municipality within Metropolitan Manila Area (MMA).
SEF shall be automatically released to the local school boards: Provided, that, in case of provinces, the proceeds shall be divided equally between the provincial and municipal school board.
SEF income has been growing through the years, with increasing RPT assessments and a more aggressive tax collection by LGU.
Utilization of SEF
LGC (LGC Secs 100 and 272) prioritized SEF for (1) construction, repair & maintenance of school buildings and facilities; (2) extension classes; (3) educational research; (4) books and periodicals; and (5) sports development activities from barangay to national levels.
Joint circulars of DepEd, DBM and DILG expanded list to include salaries of teachers and non-teaching personnel; IT resources; citizen development and other co-curricular activities.
SEF: reliable source of funding for basic education Table 7. SEF Income and Expenditures, 2001-2007 (in million pesos)
2001 2002 2003 2004 2005 2006 2007
SEF Income 8,451 9,537 11,002 10,693 12,352 13,167 14,153 Province 1,440 1,658 1,707 1,702 2,038 2,100 2,287 Cities 5,516 5,875 7,104 6,824 7,887 8,691 9,620 Municipalities 1,495 2,005 2,191 2,167 2,427 2,376 2,246
SEF Expenditures 7,774 7,395 8,826 8,854 10,265 12,249 12,063 Province 1,456 1,377 1,510 1,554 2,010 1,646 1,669 Cities 4,953 4,411 5,397 5,384 6,155 8,424 8,511 Municipalities 1,365 1,607 1,920 1,916 2,100 2,179 1,883
Total LGU Educ Expd 11,022 7,838 10,068 10,311 11,067 13,226 13,816 Province 1,990 1,515 2,062 1,956 2,047 2,180 2,175 Cities 7,016 4,744 5,807 6,219 6,679 8,722 9,182 Municipalities 2,016 1,580 2,198 2,136 2,340 2,324 2,459
DepEd Expd incl. SBP 100,393 105,923 108,074 107,941 109,182 122,718 145,860
SEF expd as % of Gen Gov educ expd 7.0 6.5 7.5 7.5 8.5 9.0 7.6
SEF expd as % of total DepEd expd 7.7 7.0 8.2 8.2 9.4 10.0 8.3
SEF expd as % ofDepEd non-PS expd 61.0 86.4 83.9 73.9 85.5 80.6 41.0
SEF expd as % ofDepEd MOOE 85.7 135.0 142.3 120.1 121.7 139.7 70.7
SEF income grew from PhP 8.5 B in 2001 to PhP 14.2 B in 2007SEF expenditure increased from PhP 7.8 B in 2001 to PhP 12.1 B in 2007
Equal to 7%-10% of total DepEd spending Equal to 6%-9% of total General Spending on Education
Total LGU Expenditure on Education is P11B in 2011 to P 14B in 2007
Source: Study of Manasan and Castel, 2010)
Wide disparity in SEF resources across LGUs of different income classes
Municipal Income Class
Median SEF of Cties
CityIncome Class
Median SEF
1st 143 NCR cities 1938
2nd 87 1st (non-NCR) 669
3rd 68 2nd-3rd 453
4th 59 4th 371
5th 45 5th 249
Median SEF spending per pupil in municipalities and citiesCY 2006
Just as wide disparities in local income, there are substantial disparities in per pupil SEF spending across different income classes. To wit , per student spending of NCR cities is almost 3 times as 5th income class cities.
This occurs primarily because the more urbanized LGUs tend to have larger RPT base as a result of the higher property values in these LGUs compared to less urbanized LGUs.
Source: Study of Manasan and Castel, 2010)
SEF Expenditure In the aggregate, SEF expenditures per student in 2007 is significantly higher
that the DedEp allocation for school level MOOE. In particular, if one assumes that all SEF are expenditures are spent on school level MOOE and if SEF are distributed across LGUs in direct proportion to enrollment, their per student ratio would be P 692 which is 3.4 x the DepEd allocation for school level MOOE.
DepEd School Level MOOE per Student
Aggregate SEF expenditure per Student
Elementary level - P 207Secondary level regular curriculum - P 500 tech-voc-curriculum - P 700
Aggregate SEF expenditure per student P 692
SEF Expenditure per student vs. DepEd School-level MOOE per student
SY 2007-2008
Source: Study of Manasan and Castel, 2010)
Current Practice on Allocation of SEF
CY Year PS MOOE CO
2006 26.6 43.3 29.6
2007 29.1 48.4 22.5
2008 28.7 48.8 22.5
In the aggregate, • almost half of the SEF is spent on MOOE• 27-29% for PS and • 23-30% to CO.
Budget Share of PS, MOOE, and CO in SEF expenditures,CY 2006-2008
Source: Study of Manasan and Castel, 2010)
2010 study on how to improve the SEF (Manasan, Castel)
FINDINGS1. Excessive emphasis on hiring locally funded teachers vis-à-vis low priority for
school building construction
2. Unclear interpretation of LGC as to the “operation and maintenance of schools”
3. Mismatch between actual school-level needs and LGU spending priorities for SEF
4. Need to clarify “sports activities” in light of transfer of DEpEd functions related to sports competition to the Philippine Sports Commission under RA 9155
Local School Boards (LSBs)
Local School Boards(one of the Local Special Bodies)
Local Special Bodies Councils, committees or the like created to perform definite functions on the LGUs.
There are five of such bodies, namely, Local Development Councils (LDC)
Local Prequalification, bids, and awards committees (LPBAC)
Local School Boards (LSB)
Local Health Boards (LHB)
Local Peace and Order Council (LPOC)
There shall be established in every province, city, or municipality a provincial, city, or municipal school board
The LSB is the body primarily responsible for the allocating the share of the LGU in the Special Education Fund (SEF).
Functions of the Local Special Bodies
Local Development
Council
Local Prequalification, Bids and Awards
Committee
Local Health Boards
Local Peace and Order Council
Local School Boards
• Assist the Sanggunian in setting the direction of economic and social development and coordinate development efforts
• Responsible for prequalification of contractors, bidding, evaluation of bods and recommendation of awards of projects
• Advisory to the Sanggunian on health matters• Propose budgetary allocation for health facilities and
services
• Responsible for proposing programs for peace, order and public safety in localities
• Advisory to the Sanggunian on education matters • Responsible for allocating the share of LGUs in the SEF
Activities and Budget of LSBs(LGC Sec. 100)
Meet at least once a month or as often as may be necessary.
Local chief executive concerned, as a matter of protocol, shall be given preference to preside the over the meeting.
Division superintendent, city superintendent or district supervisor, as the case may be, shall prepare the budget of the school board concerned. Such budget shall be supported by programs, projects, and activities of the school board for the ensuing fiscal year.
The affirmative vote of the majority of all the members shall be necessary to approve the budget.
Challenges and Recommendations
Challenges Need for greater alignment of the SEF with the programs and priorities of
national government. Information on the allocation from the national budget have to be communicated to LGUs to ensure the SEF is used to advance programs for basic education.
Need for clearer statements as to allowable expenditures chargeable to SEF expenditures under SEF particularly expenditures are included under “expenditures for operation and maintenance of public schools” as per Sec. 272 of LGC
Need for clearer assignment of expenditure responsibility – DepEd vs. provincial LSB vs. municipal/ city LSB
Need to strengthen link between LSB/ SEF utilization and implementation of Kto12
Information sharing between DepEd (not just at Division and District Office level but also Central Office level) and LSBs
Need for better coordination between provincial LSBs and municipal LSBs
How does LSB relate to School Governance Council?
Proposed Recommendations
Improve SEF utilization guidelines prescribed in LGC
Avoid expenditure overlaps by clarifying well who should spend for what--DepEd or LGUs e.g. textbooks
Increase equity in education spending by providing more to LGUs with low real property tax base
Proposed Recommendations Improve revenue collection for SEF. SEF grows when RPT collections
improve
• The efficiency of LGUs in collecting real property taxes improved significantly between 2007 and 2012.
RPT collection efficiency (collections as a proportion of collectible amount), 2006-2012 2006 2007 2008 2009 2010 2011 2012
Provinces (w/ munis) 68.6 52.8 58.9 68.9 64.8 74.3 77.9Cities 89.9 95.1 78.3 70.5 82.4 79.2 85.9All LGUs 82.2 73.1 71.5 70.2 76.4 77.6 83.3
PROBLEM: real property values are not being updated
Number % Number % over 10 years 19 23.8 58 40.3 6 - 10 years 28 35.0 46 31.9 5 years or less 33 41.3 40 27.8
TOTAL 80 100.0 144 100.0
Provinces CitiesAge of real property values
Outdated ValuationMany LGUs have NOT regularly updated their schedule of market values—the basis for computing the RPT—resulting in lower-than-expected collections.
Challenges
Political DifficultySanggunian members, who must approve the new market values, are reluctant to enact the relevant ordinance due to its political backlash.
Transfer the mandate to approve the schedule of market values (SMV) for real property from the Sanggunian to the Department of Finance
LGUs to retain autonomy in setting assessment levels and tax rates for real property
Proposed Recommendations
Thank you