In Public Fiscal Administration
A Special Research
Presented to the Faculty of Graduate School
Open University
Polytechnic University of the Philippines
In Partial Fulfillment
Of the
Requirements for the Degree
Master in Public Administration
By
Anthony C. Mercado
14 February 2010
CHAPTER 1
THE PROBLEM AND ITS BACKGROUND
Introduction
The Republic Act 7160 or commonly known as the Local Government Code of 1991 had enacted the transfer of power and authority from the national government to local units. As the territorial and political subdivisions of the state. One of the powers devolved to the local government unit is the power to create its own sources of revenues. Merely, this autonomous power is a challenge to every local official in the grass-root.
Decentralization may not succeed if the local government officials will not be given the power and authority to generate and expend funds freely in accordance with the law. Local government officials with their limited educational background and trainings more specifically at the barangay level may hamper the performance of their unit in generating additional revenue on top of the fixed Internal Revenue Allotment as provided under RA 7160
Local government has been considered important to the encouragement of political education and participation, and the basis upon which services could be provided according to local needs. Hence, relationships with the national have been based on the partnership of free democratic institutions. Secondly, local government has been seen as rational from an administrative point of view as it allows for the efficient provision of public services at the point of service need under the direction of the national. On this basis local government is seen as the agent of central government.
Theoretical Framework
The Local Government Code of 1991 (LGC) was an ambitious effort to transform local government