Are we ready for a federal government?

Is federalism the panacea for the many troubles that beset our nation? Globally, a majority, or 166 of the 199 nations of the United Nations (including the Philippines) are unitary in form and only 27 are federalized although they comprise 40 percent of the world population. One may also peruse a very recent study made by the Ateneo de Manila on the comparisons, based on empirical evidence between the federal and the unitary governments of the world. For instance, it says in the Asean, the Philippines, Indonesia and Thailand are unitary, while Malaysia is federalized. Further, the Ateneo study says among the three, the Philippines is the most decentralized. Shocking of all, it turns out that federalized Malaysia was judged the most centralized in real terms.

The conclusions, therefore, are that: (a) federalism does not always mean decentralization and (b) that decentralization can still be achieved under a unitary state like the Philippines.

We offer two suggestions to further improve the decentralization of our unitary form or government that may affect the outcome that federalism advocates hope to achieve. One is to create truly autonomous regional offices of all national agencies and instrumentalities equipped with powers to implement decisions without consulting imperial Manila. The other is to improve the share of local government units (LGUs) in the national tax pool, which has remained unchanged since 1991.

The law says the percent share of the LGUS be rationalized every five years. But in the last 26 years, from 1991 to 2017, the chance to increase the LGU share was allowed to pass at least five times in 1996, 2001, 2006, 2011 and 2016. What wasted time for
rural development.

But, of course, there are “pure” federalists that want the state’s (region) autonomy be derived from the Constitution itself and not devolved from the Executive branch that can be taken back again under a unitary government. Federalism authority Ronald Watts sums it up handsomely: “The key is not the degree of decentralization but the degree of constitutionally guaranteed autonomy that the constituent units may exercise.”

Interestingly, former Chief Justice Hilario Davide Jr. favors retaining the unitary form, while the former Chief Justice Reynato S. Puno, who heads the constitutional commission, opts for federalism. Davide says the 1987 Constitution provides for a healthy balance of power between the Executive, Legislative and Judiciary; it prevents the abuse of power and enshrines the constitutional right of People Power. For all its flaws, the unitary system survived the brutalities of martial law and the economic downturns that helped the Philippines emerge a vibrant democracy and one of the leading economies in Asia. Why fix a wheel that is not broken?

Former Senate President Aquilino Q. Pimentel Jr., who authored the landmark Local Government Code, believes this is not enough and endorses a full shift to federalism. CJ Puno believes the centralization of power in a unitary government is the cause of the lack of political or economic “inclusion” as the levers of power are controlled by the economic elite and the political dynasties who are closely linked to the national government. Constitutional expert Christian Monsod cites data analytics, saying only three regions, namely, the National Capital Region, Calabarzon and Central Luzon, can sustain themselves under a federal form, contributing as they do 63 percent of the country’s GDP.

CJ Puno, however, counters he is open to an “evolving” federal form, with half states allowed to devolve into full ones at their own speed and are autonomous regions where cultural/religious idiosyncrasies rather than fiscal reasons necessitate their independence like that of the Autonomous Region in Muslim Mindanao and the Cordilleras. There are talks on the “equalization fund” meant for stronger states to help the weaker ones graduate into full states.

President Duterte prefers the French model with a President and Prime Minister. The PDP-Laban basically agrees to a bicameral Parliament and 11 or 12 independent states ran by their own parliaments.

The constitutional commission, on the other hand, is set to submit to the President their recommended version on July 1 prior to the deliver of the state of the Nation Address or Sona of the President. On how the Charter change will be implemented, both Davide and Puno agree this has to go through a constitutional convention, where delegates vote and the new Charter ratified by the vast electorate. To insist on other means seriously misreads the political psyche of the Filipino electorate.


Dejaresco, a former banker, is a financial consultant, media practitioner and book author. He is a Finex life member and chairman of its broadcast media. His views here, however, are personal and do not necessarily reflect those of Finex.


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