Press Release
August 2, 2013

Barangay IRA hiked to P68.3 B next year

Share of the country's 42,028 barangays from internal revenues will go up to P68.3 billion next year, or a P7.8 billion increase from this year's P60.5 billion, Senate President Pro Tempore Ralph Recto revealed today.

While some quarters have viewed this kitty as a major reason why many are interested in running in the Oct. 28 barangay elections, Recto defended the Internal Revenue Allotment (IRA) share of barangays as a "necessary frontline expense."

"The barangays are our first responders. Whether it is a fire or a youth rumble or domestic quarrel or a theft, the first distress call is sent to and responded by the barangay. When there is trouble in the neighborhood, you don't call the Army, you call the tanods," Recto said.

"Kahit nga sa edukasyon, unang paaralan na papasukan ng mga bata ay day care centers na pinapatakbo ng mga barangay. Ang street patrols ngayon, kadalasan mga tanod na. Kahit sa kalsada, mas marami kang barangay traffic aide na makikita kesa pulis," Recto said.

Amid social media chatter that the IRA of barangays be scrapped, Recto said the allotment is a "legal entitlement, set by law."

Under the formula set by the Local Government Code, the national government plows back to local governments 40 percent of internal revenue collections which in turn is shared among LGUs with barangays receiving 20%, provinces 23%, municipalities 34% and cities 23%.

The current IRA share of these local governments is determined on basis of internal revenue taxes collected by the national government three years ago. "In short, it is a rebate to the grassroots," Recto explained.

"Yet, barangays get just one fourth of one percent of the national budget," Recto said, referring to the proposed P2.268 trillion national budget for 2014. Recto said there are valid criticisms against the way some barangays are run.

"There are barangays that observe best practices. Meron din mga barangay na showcases of how not to run an office. There are barangay leaders who perform beyond and above the call of duty at meron ding mga pasaway. But the bottomline is that we are better off with barangays than without," Recto said.

"Kasi meron mga lugar na malayo sa kabihasnan, and the only semblance of government presence there is the barangay. If you take it out, you take out rule of law," he said.

For next year, IRA is pegged at P341.54 billion, up from P302.3 billion this year.

The IRA, however, is but one - although the biggest - of the components of what is called as the Allocation to Local Governments (ALGU) item in the national budget which for 2014 has been allocated P360.5 billion.

Other items in the ALGU are the shares of local governments from tobacco excise tax collections and taxes from mining and other extractive industries, and the budget of the Metropolitan Manila Development Authority, among others.

As to the operating expenses of the Sangguniang Kabataan, whose officers will also be included in the Oct. 28 ballot, Recto said they will get 10 percent of the barangay share from the IRA, or P6 billion this year and P6.8 billion next year, or an average of about P162,000 per annum per SK in 2014.

He said he has yet to make a stand on calls that the SK be abolished. "But at the minimum, it must be reformed."

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