The proposed shift of the Philippines from a unitary system of government into federalism has been the subject of debates of many Filipinos since the President announced his preference for a federal form of government. Some disapprove of this shift, believing it a ruse to justify term extensions. Supporters of a shift to the federal system believe that it will contribute to the country’s political and economic development.
I was born in the 1940s, in a democratic, unitary state. At that time, Filipinos were already experiencing poverty, hunger, and unemployment. I will not say that the Philippine presidents back then were no good. But it made me ask—what could be wrong, the governance, or the system of government in place?
We are in a different time now. I think it is necessary to amend the present system to be aligned with the conditions of the present and the foreseeable challenges of the future, instead of being stuck to a reaction from the past.
The current mode of running the country has been largely based, and dependent, on the appropriations by the national government for projects and programs for the country. The revenues generated by all government units, including the local government units are collected by the national government and are distributed to the LGUs through the Internal Revenue Allotment, and to the government agencies through the General Appropriations Act. We have a highly centralized government that has resulted in an imbalance distribution of resources among regions and LGUs.
In the proposed Philippine federal system, there shall be two constitutionally-established levels of government—the federal government and the regional government. The shift to federalism enables an equitable and widespread development in the country, by decentralizing political and economic power, to allow for independent, self-determined federal states. If we adopt the federal system of government, each state/regional government will be required to produce its own income. Towns, cities, and provinces will no longer be welfare-dependent.
Our country is rich in natural resources. In a federal government, provinces and regions that are rich in natural resources can enjoy the entirety of the revenues they generate by supplying raw materials and producing goods out of these raw materials. In the present system, natural resources such as minerals and agricultural products are considered to be national wealth and only a small percentage is given to the regional or provincial source. Obviously, this does not help the provinces and regions that much.
There are business process outsourcing companies expanding all over the country, and a rising number of overseas Filipino workers. Experts project that by 2022, the BPO sector shall generate around $40 billion in revenues, with a 9-percent growth yearly. Meanwhile, OFW remittances may generate $66.7 billion, with a 7-percent growth annually. Under the federal system, those areas where the BPOs are located, or the OFWs are from, will be entitled to the revenues earned by these high income generating sectors.
The proposed shift into federalism also comes with a transition mechanism, particularly for regional governments so they can prepare for further decentralization.
As the debates continue, let us keep an open mind. Change is not always comfortable; but we should know that greater things may happen outside our comfort zones.