Vol. XXVI No.3 Editor's Notes Post-2008 CARP · delay coverage of their lands in the agrarian reform program, according to Atty. Leonen, Dean of the College of Law, University of

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Editor's Notes

Vol. XXVI No.3 May - June 2008 ISSN 0115-9097

P H I L I P P I N E

I N S T I T U T E F O R

D E V E L O P M E N T

S T U D I E S

Surian sa mga Pag-aaral Pangkaunlaran ng Pi l ip inas

DEVELOPMENTDEVELOPMENTDEVELOPMENTDEVELOPMENTDEVELOPMENTRESEARCH NEWSRESEARCH NEWSRESEARCH NEWSRESEARCH NEWSRESEARCH NEWS

Post-2008 CARP:extension withcritical reforms

8 PIDS conducts research dissemination forumin Cagayan Valley

10 Senate-PIDS economic forum tackles agrarianreform

11 PIDS expert calls for reforms on BOT law

The month of June signals the expiration of theComprehensive Agrarian Reform Law (CARL) whichgives life to the landmark Comprehensive Agrar-ian Reform Program (CARP).

Land ownership brings with it not only the oppor-tunity for the farmers to improve their lives, butmoreso it is a testament that the state is bent oncurbing poverty in the countryside through landreform.

The CARP has been in place for twenty years now.While some would challenge its accomplishments,it is important to see whether or not the programhas contributed to increased productivity and to amore equitable distribution of resources.

In this issue of the DRN, the highlights of thestudies conducted by PIDS researchers under ajoint PIDS-World Bank undertaking with fundingfrom the Food and Agriculture Organization (FAO)are presented with the hope that they can serveas useful inputs in the ongoing deliberations onwhether the program is to be extended or not.

The studies also complement other studies doneby researchers and agrarian reform experts whohave pinpointed the weaknesses of the CARP and

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For decades, farmers cried out for lands they could call their own. Ear-lier efforts were implemented but they were limited only to rice andcorn farmlands.

The enactment of the Comprehensive Agrarian Reform Law (CARL) orRepublic Act 6657 covering more lands was a bold move, not to mention arevolutionary measure then, and until now.

At a glance, the country’s land redistribution program has been successfuland even comparable with the land reform programs of other nations, withabout 6.8 million hectares of private and public agricultural lands alreadydistributed by the Department of Agrarian Reform (DAR) and the Depart-ment of Environment and Natural Resources (DENR)(Table 1).

With such huge amounts of land already distributed, the ComprehensiveAgrarian Reform Program or CARP is expected to have similarly made ahuge impact on addressing the poverty and equity problems in the country.

Studies, however, have shown otherwise. In reality, the program was not ableto target majority of the landless and the poor, and those who benefited werenot provided with the appropriate support services. Thus, CARP’s impacton poverty, productivity, or investments in the agriculture sector has beenlimited.

CARP is approaching its 20th year of implementation. Its land acquisitionand distribution program would have been completed by now. That it hasnow almost reached its termination date and a substantial amount of privateagricultural lands remains undistributed has made CARP even more con-troversial, with the question of whether to approve a bill that would extend

DEVELOPMENT RESEARCH NEWS May - June 20082

it to at least another five years or to finally putit to rest, at the center of the debate. Givenits shortcomings and the changing rurallandscape, the stakeholders now face this bigquestion: should it still be extended?

Many believe that there is still need to ex-tend the CARP but with the necessary insti-tutional reforms in its agrarian justice system,land administration and management, andrural development architecture. Extendingit without these reforms would just entailhuge costs without the expected benefits onpoverty alleviation and productivity, accord-ing to discussions at the recently concludedRound Table Discussion (RTD) on theCARP Institutional Assessment in a Post-2008 Transition Scenario held at the CarlosP. Romulo Hall of the NEDA sa Makati Bldg.in Makati City.

In the said RTD, three research studies,namely, Reform for the Agrarian Justice Sys-tem authored by Atty. Marvic Leonen; Impli-cations for Land Administration and Man-agement (LAM) written by Dr. MarifeBallesteros and Engr. Felino Cortez; and To-wards a New Rural Development Architec-ture by Dr. Fermin Adriano highlighted cer-tain recommendations that are crucial tocorrect the inconsistencies and conflicts inthe program in order for the extension pe-riod, if it happens, to truly benefit its in-tended beneficiaries.

The said research papers were conceivedunder the initiative of the Rural Develop-ment, Natural Resources and EnvironmentSector of the Word Bank and funded

through the Food and Agriculture Organi-zation, in collaboration with the PIDS.

Agrarian justice systemNumerous laws, statutes, and presidential de-crees dating as far back as the Commonwealthtime are still in effect today. A number ofthese are in conflict with the CARL and nor-mally used by landowners in their efforts todelay coverage of their lands in the agrarianreform program, according to Atty. Leonen,Dean of the College of Law, University of thePhilippines, and a prominent figure inCARP judicial cases.

In view of this, when conflict arises, the dif-ferent laws, statues, and decrees are pittedagainst one another, prolonging the solutionof cases in court. Such conflicts arise whenthe release of certificates of land ownershipaward (CLOA) or emancipation patents(EP) would not result to increase of produc-tivity or when a reversion of the original rela-tionship takes place.

The paper enumerated six types of conflictin the agrarian reform sector. Type one con-cerns disputes between landowners and thefarmer beneficiary while type two involvesconflicts between the landowner and theState. Type three involves the conflict be-tween the farmer beneficiary and the State,and type four refers to conflicts amongfarmer beneficiaries themselves.

Conflict disputes between putative landown-ers that delay or affect the implementationof any part of the agrarian reform programcomprise type five while type six conflicts

Table 1. Summary of CARP accomplishment (as of December 2006)

Scope (has) Accomplishment No. of Beneficiaries Area (ha) % Balance (ha) b)

DAR 4,428,357 3,826,214 86.40 1,337,538 2,201,934 DENR Public A & D a) 2,502,000 1,720,186 68.75 781,814 1,447,818 ISF/CBFM 1,269,411 1,335,999 105.25 completed 502,380 TOTAL 8,199,768 6,882,399 2,119,352 4,152,132

a) Scope revised from 4.5M hectares to 2.5M hectaresb) Balance of DAR based on revised scopeNote: Official statistics from DAR Planning Services Office

Sources: Planning Services Office, DAR; Comprehensive Agrarian Reform Program-DENR

DEVELOPMENT RESEARCH NEWS 3 May - June 2008

cover disputes among participants in theagrarian reform program and third parties.At present, these conflicts are resolvedthrough adjudication; however, the sameproblems that hamper the judicial process,such as the need for lawyers’ appearances,delays in the presentation of evidences,crowded dockets, and potential for abuse andcorruption derail the proceedings.

In his recommendations, Atty. Leonen saidthat for the type one, type four, types five andsix conflicts, arbitration should be pursuedbecause these are all private cases. Types twoand three conflicts should be continuouslyhandled by the DAR Adjudicatory Board(DARAB) because they concern issues oncoverage, retention limits, and valuation ofcovered agricultural lands.

Arbitration is an alternative to the disputeresolution process; however, provisions in theCARL disallowed it for agrarian disputes.The author stressed that arbitration offersboth conflicting parties to choose neutralarbitrators from a pool of private parties. Itimposes that cost must be shouldered by bothparties with the state giving subsidies tothose who are poor. It also gives arbitratorsincentives to hone their skills because theirreputation is bolstered with every successfulconflict settlement.

The present openness of the SupremeCourt for an alternative method of disputeprocessing as well as the Alternative DisputeResolution Law of 2004 can present othersolutions involving agrarian reform conflicts.

The paper recommends that DARAB andthe Bureau of Agrarian Legal Assistance(BALA) be restructured to allow compulsoryarbitration. In addition, continued trainingprograms should be provided for adjudica-tors, arbitrators, agrarian reform lawyers, andparalegals who assist in alternative disputemethods.

It is also crucial to reduce, if not totally eradi-cate, ambiguity among the provisions of theAgricultural Land Reform Code, Public LandAct, and Property Registration Decree inrelation to the CARL, wherein all applicableprovisions should be incorporated in the stat-ues that will extend CARP.

The legislations that would extend CARPneed to elucidate under which conditionsagricultural lands can be mortgaged. Hold-ing of agricultural land must also be depen-dent in terms of its possible productivity.Thus, private idle and abandoned landsmust be covered by agrarian reform unlessthey may have other uses but only within aperiod of one year.

Land administration and manage-ment (LAM)The main functional area of CARP is landacquisition and distribution (LAD). Thisinvolves the identification of the extent ofCARP coverage; acquisition of private landsby the government; determination of landvalues or just compensation; and land titlingand registration of titles.

Land redistribution from the start, however,has been problematic because of weak landpolicy and poor land administration in thePhilippines. According to Dr. MarifeBallesteros, PIDS Senior Research Fellow,and Engr. Felino Cortez, former Director forLand Title Registration at the Land Regis-tration Authority, landownership data onnational and provincial levels are all guessestimates. This is because land informationin the country is fragmented and land agen-cies are not harmonized. Consequently, thishas resulted in poorly identified and tar-geted land reform.

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rgConflicts arise when the release of certificates of land owner-ship award (CLOA) or emancipation patents (EP) would notresult to increase of productivity or when a reversion of theoriginal relationship takes place.


Compounding the problem is the weak ef-fort of the DAR to strengthen its land infor-mation base. DAR has failed to develop aneffective monitoring system to allow for in-tervention and regulation. Moreover, DARallowed land redistribution without complet-ing the transfer of property rights based onthe property registration laws of the country.About one-third or 2 million hectares of landdistributed under CARP have collectivetitles. Some titles issued by DAR have notbeen formally registered due to problems oflost titles or title reconstitutions. Titles havealso been issued pending cases or appeal oflandowners which can result in the cancella-tion of CLOAs or EPs should the courts rulein favor of the landowner.

Second-generation problems have thuscropped up due to these practices. Theawarding of CLOAs or EPs under the Tor-rens registration system may have givenfarmer beneficiaries the permanency of cul-tivating the land but the CARP action of is-suing titles before the completion of docu-ments weakens the indefeasibility of thetitles. The tenure securities of the benefi-ciaries are continuously threatened when

conflicts in land redistribution result to pro-tracted court battles.

Aggravating this is the practice of trading the“unperfected” titles in the market. While thelaw prohibits this action for a period of 10years after the award is granted, land trans-fers have been forged through direct sale,waiver of rights of beneficiary, sale via pawn-ing, and simple land abandonment. Thus,informal land market in the rural areas pro-liferated and landownership has turned tomore distorted land ownership information.

The authors then recommend restoring con-fidence on the Torrens title on agriculturelands through several measures. The DARshould establish a systematic and compre-hensive database of CARP accomplishmentsnot only of beneficiaries and land coveragebut also information on auxiliary functionssuch as land conversion and land transfers.

The DAR has to give priority to completingtransfer of property rights. There is a needto accelerate the resolution of agrarian cases;undertake parcellization on land covered bycollective CLOAs; intensify the collection ofland amortization and initiate theredocumentation process on land that hasalready been redistributed.

The biggest land administration problemthat will be faced by CARP is theredocumentation process involving collec-tive CLOAs that were sold illegally by thebeneficiaries.

The process would be long and tedious, evenrequiring judicial processes. One of the pro-posals to facilitate redocumentation is forthe Land Bank to invoke the provisions ofSection 26 of RA 6657 that would forecloseall the lands of nonpaying Agrarian ReformBeneficiaries (ARBs). It will then re-identifyand redocument the current occupants ofthe lands covered by CARP. This will be onthe basis of a will that shows that the occu-pants are the ARBs on record, or people whoare not the ARBs on records, or were thebuyers of the lands.

The approval of the proposed Land Admin-istration Reform Act (LARA) is another so-lution seen to facilitate the correction of the

Speaking before part ic ipants in the recently held "Round Table Discussion(RTD) on the CARP Institutional Assessment in a Post-2008 Transition Sce-nario" are (from left) Dr. Fermin Adriano, former Vice Chancellor for Planningand Development at the University of the Philippines Los Baños; Dr. MarifeBal lesteros, PIDS Senior Research Fel low; PIDS President Dr. Josef T. Yap;Atty. Marvic Leonen, Dean of the College of Law, University of the Philippines;and Engr. Felino Cortez, former Director for Land Title Registration of the LandRegistration Authority.


EP/CLOAs’ titles. The LARA will make wayfor the creation of the Land AdministrationAgency (LAA) to rationalize the fragmentedsystem of LAM in the country. It pictures theformulation of a single office that would beefficient in the survey and mapping of land,first-time titling of alienable and disposableland, registration of land titles and title trans-fer, and public land management. With this,significant improvement in the titling systemwill be achieved.

Another solution is the lifting of restrictionson the conveyance of awarded lands that iscrucial to facilitate the correction and effi-cient functioning of land markets. The EP/CLOA titles cannot be perfected unless thelaw allows its sale and transfer through themarket. The lifting of land market and ten-ancy regulations will also allow for more effi-cient transfer of resources from less produc-tive farmers to more productive ones. It willalso improve access of the poor to land.

In the long run, the DAR phase-out as wellas its integration with other land agenciesand the Department of Agriculture (DA) islikely to happen. The combined efforts ofDAR, DENR, Department of Justice, and theLand Registration Authority are required inpost-land distribution. Thus, the proposedLAA will make available the means to bringtogether the land functions of these differ-ent agencies. Hence, DAR’s beneficiary de-velopment activities can be integrated withthe DA.

New rural development architectureThis paper written by Dr. Adriano, formerVice Chancellor for Planning and Develop-ment at the University of the Philippines LosBaños, argues that (a) while agrarian reformincrementally raised productivity amongagrarian reform beneficiaries, the gains werenot significant enough to extirpate themfrom poverty and more so, make them glo-bally competitive; (b) while there was im-provement in the socioeconomic well-beingof most ARBs, they remained poor and pov-erty situation in the rural areas hardly im-proved; and (c) despite implementation ofagrarian reform for several decades now, com-munist insurgency persists in the Philip-pines despite its demise in most countriesin the region.

He added that income inequality is still aserious problem in the Philippines, with 48.8percent poverty level in the rural areas ascompared to the 18.6 percent in the urbanareas. While the agrarian reform program isanchored on the belief of land to the tillers,the rural scenario has been affected by rapidpopulation growth and greater land scarcityand conversion of lands to nonagriculturalpurposes.

The rural labor force is now also largely com-posed of landless agricultural workers com-prising 8.5 of the total 11.2 million. As such,agrarian reform does not apply to them pri-marily because they are not share tenants andare not entitled to own lands.

In the aspect of land acquisition and distri-bution (LAD), the highest balance can befound among private agricultural lands(PAL). Table 2 summarizes CARP’s accom-plishments in LAD where around seven mil-lion hectares of public and private lands havealready been distributed.

Table 2. LAD distribution status (in million hectares) by land type/mode of coverage(1972–June 2006)

Source: DAR 20061/ Note that PAL is composed of Voluntary Offers to Sell (VOS), Voluntary Land Transfers (VLT),and

Compulsory Acquisition. VOS and VLT constitute most of the lands distributed under PAL.2/ Covers all regions, including ARMM.3/ Straight deduction of accomplishment from the scope.4/ DENR already completed/exceeded its scope by 66,588 hectares on the issuance of CSC/CBFM

agreement in the forestry areas. Total balance refers to the issuance of patents for public Aand D lands.

Land TypeDAR

Tenanted rice/corn lands (OLT PD 27)

GFI-owned lands (EO 407/448)Private agricultural lands (RA 6657)

Subtotal - PAL

GOL/KKK landsSettlements

Landed estate

Subtotal-non PALTOTAL (DAR)

DENR

Public A and D landsISF/CBFMA lands

TOTAL (DENR)

TOTAL (CARP)

Scope

0.564

0.182

2.8613.607

0.921

0.7150.081

1.717

5.324

2.502

1.2693.771

9.095

Accomp

0.556

0.1591.368

2.083

0.8490.706

0.080

1.6363.718 2/

1.6011.336

2.937

6.655

% Accomp

98

8748 /1

58

9299

99

9570

64105

78

73

Balance

0.008

0.023

1.4931.524

0.072

0.0090.001

0.081

1.606 3/

0.901

0.0670.901 4/

2.507


ties.

The agrarian justice delivery (AJD), on theother hand, has been impressive since withonly 30 lawyers in the DARAB attending tothe thousands of cases, they have resolvedmore than the average 16,500 cases filed tothem in the last four years.

The support services afforded to the ARBs,namely farm-to-market roads, irrigation sys-tems, post harvest facilities, and extensionservices, among others, comprise the pro-gram beneficiaries development (PBD). ThePBD aims to support higher farm productiv-ity among ARBs after their lands are awardedto them.

Agrarian Reform Communities (ARCs) inturn were formed from clusters of ARBs ad-jacent to each other to promote economiesof scale in terms of service delivery and pro-duction. There have been 1,800 ARCs orga-nized by DAR since 1993. However, the pa-per also noted that only three out of the 10ARB beneficiaries are provided support ser-vices with the remaining seven, left out ontheir own. This indeed may partly explainthe ongoing poverty among farmer benefi-ciaries.

In light of all these, Dr. Adriano recommendstwo options. In Scenario/Option 1, CARPwould be extended for another 7–10 years.He explained that under this option, thereis a need first to shift manpower resources tothe DAR units engaged in LAD and AJD andto provinces where land balance remainshigh.

Second, there should be identification andpublication of private agricultural lands(PAL) in high LAD balance provinces. Thiswill be covered by the LAD component inthe extension period, and categorized intoland size where the distribution priority mustbe imposed on large-sized PAL lands.

Third, there is a need for the retooling ofDAR personnel for them to be more effec-tive in their task of establishing agriculturalenterprises out of a partnership between

ARBs and agribusiness firms. Fourth, LGUs’capacity building training in providing sup-port services to ARBs in preparation for theend of the program should be strengthened.Fifth, as accountability must be imposed onboth the LGUs and the ARBs, efforts to col-lect amortization from ARBs must be pur-sued.

On the other hand, Scenario/Option 2 en-visions the closure of the CARP in the nextthree to five years and requires that an attrac-tive retirement package be offered to DARpersonnel. The Agrarian Reform Fund(ARF) may be considered as the fundingsource for this. This option also includes theforming of a Land Tenure Administration(LTA) that will encompass AJD and LADcases as well as land-related cases covered byancestral domain claims and forest lands.The Presidential Agrarian Reform Council(PARC), which acts as the policymaking of-fice of CARP, should be converted into a JointCommission on Rural Development (JCRD)that will give policy direction and oversightrole to agencies related to rural develop-ment.

Other recommendations in this option in-clude the renaming of the DA to Departmentof Agriculture and Rural Development(DARD), reiterating its expanded role in ru-ral development, specifically in supportingsmall farmers and ARBs as well as the absorp-tion of some DAR personnel to the renamedorganization. Funding from the ARF mustbe created for proposals of LGUs for projectsgeared to assist ARBs and cover capacitybuilding programs.

To discourage ownership of vast lands, spe-cifically those that are idle or abandoned,there is a need to pass the “Progressive Agri-cultural Land Tax” for private agriculturallands and “Progressive Rents” for publiclands under lease agreements. Lastly, deregu-lation of land tenure contracts and land mar-kets must be implemented and made a partof the “Progressive Agricultural Land Tax”and “Progressive Rents.”

“CARP is a clear constitutional mandate with a sound social perspective. Itreduces poverty, stimulates economic growth, and promotes social justice."


Valuable reactions“CARP is a clear constitutional mandate witha sound social perspective. It reduces pov-erty, stimulates economic growth, and pro-mote social justice,” Apayao Rep. Elias C.Bulos, Jr., Chair of the Committee on Agrar-ian Reform, said in a written statement readby his staff, Ms. Rita Macabulos.

Further, he clarified that it is not the CARPthat will end but the land acquisition anddistribution program and its funding sup-port. He added that CARP would only beuseful as long as it is extended.

As the Chair of the House Committee onAgrarian Reform, he shared the varioushouse committee hearings and out-of-townconsultations the committee conducted. Inthe said consultations, farmers have consis-tently aired their support for CARP andclamor for extension with reforms.

For his part, Fr. Francis Lucas, Chairpersonof the Asian NGO Coalition for AgrarianReform and Rural Development, stressedthat unfulfilled social reform and constitu-tional commitment that remain to be undis-tributed are some of the reasons CARPshould be extended. These constitute 1,007million hectares of DAR targeted lands andanother 600,000 hectares from the DENR.

He added that the civil society clamor notjust for an extended CARP but a completeCARP, mainly in the implementation of LAD.Fr. Lucas also agreed on the important as-pects that needed reforms for CARP as statedin the findings of the three papers that werepresented.

However, as opposed to the general findingsthat CARP has not made the necessary im-pact on the poverty situation of farmers, hesaid that there exist successful ARCs andARBs because of the full implementation ofthe agrarian reform in the aspects of landtenure improvement (LTI) and PBD.

Moreover, he cited studies that confirm thatgiving full ownership and control of lands tothe farmer beneficiaries encourage them toinvest more to attain land productivity. Stress-ing his point further, he said that increased

landless tillers are a natural course of boom-ing rural population, as children of newowner-cultivators with better education optfor nonfarm occupations.

C o n c l u s i o nIn closing, there may be strength in num-bers, specifically when considering the mil-lions of hectares of lands that were alreadyacquisitioned and distributed to farmer ben-eficiaries. These numbers, however, havefailed to completely address inequalities andpromote financial gains in the agriculturalsector.

An extension with reforms is indeed seen bymany as crucial to ensure that prior gainswill also be attainable for the others who haveyet to receive their lands, because not beingable to achieve this will only create new in-equalities. But assurances have to be madeclear on the specific period of completionfor the remaining tasks to be done.CSM

R e f e r e n c e sBalisacan, A.M., et al. 2007. Comprehensive

Agrarian Reform Program impact assess-ment: study on the impact of CARP onpoverty reduction and prospects for long-term growth. Quezon City: Departmentof Agrarian Reform.

Deininger, K., F. Lara, Jr., P. Olinto and M.Maertens. 1999. Redistribution, invest-ment, and human capital accumulation:The case of agrarian reform in the Phil-ippines. Washington DC: The WorldBank.

Habito, C.H., R.M. Briones and E.M. Paterno.2003. Investment, productivity, and landmarket impacts of the ComprehensiveAgrarian Reform Program. CARP impactassessment studies. Volume 4. QuezonCity: Department of Agrarian Reform.

Hayami, Y., M.A. Quisumbing and L. Adriano.1990. Towards an alternative land reformparadigm: a Philippine perspective.Quezon City: Ateneo de Manila Univer-sity Press.

Reyes, C.M. 2003. Impact of agrarian reformon poverty. CARP impact assessmentstudies. Volume 7. Quezon City: Depart-ment of Agrarian Reform.


When Republic Act 7160, betterknown as Local Government Code(LGC) of 1991, was enacted, it not

only gave the Local Government Units(LGUs) the power to be self-reliant andbroaden their power in exercising their du-ties, it also made the LGUs recipients of theInternal Revenue Allotment (IRA) to fundvarious programs and projects crucial to theeconomic and social development of theirareas.

The LGC of 1991 mandated that LGUs shallreceive a share in the national internal rev-enue taxes based on the collection from thefirst fiscal year preceding the current fiscalyear. This was accomplished given the fol-lowing schedule: 30 percent on the first yearof the LGCs’ effectivity; 35 percent on thesecond year; and 40 percent on the third andsucceeding years.

However, many years after the IRA was imple-mented, there still remained questions andinconsistencies on how it is being distributedand the impact it has created in the localsetting.

In view of this, there is a need to address theissues in the IRA design itself for it to beeffective, according to Dr. Rosario Manasan,Senior Research Fellow at the Philippine In-stitute for Development Studies (PIDS), inher presentation during the recently con-cluded forum conducted by the PIDS, theNational Economic and Development Au-thority (NEDA) Regional Office 2, and thePhilippine Chamber of Commerce and In-dustry (PCCI) Cagayan Chapter, at the NEDAConference Hall in Carig Sur, TuguegaraoCity, Cagayan Valley.

Dr. Manasan presented the findings of herstudy Internal Revenue Allotment Design:

PIDS conducts research dissemination forumin Cagayan Valley

Issues and Challenges, citing that IRA de-sign issues have impeded the correction ofthe imbalance in the revenue-raising capaci-ties and expenditure needs of the LGUs.

She then enumerated the issues as: “first, avertical imbalance leading to the inadequacyof the IRA to fund the expenditure func-tions assigned to them; second, the lack ofan equalizing feature in the IRA distribu-tion formula that results in disparities in thefiscal capacities of LGUs, thus widening thegeographic disparities in human develop-ment outcomes and level of economic de-velopment; third, the distinctive effects onlocal revenue generation; and fourth, thepoor predictability in size of the IRA whichundermines the ability of LGUs to effectivelyplan and manage their expenditures.”

The study recommends that the vertical im-balance be primarily addressed throughgreater tax decentralization or the assign-ment of more taxes to LGUs so as to improveaccountability at the local level. At the sametime, this reform should be coupled with are-design of the IRA toward achieving greaterequalization across LGUs.

However, this would entail the amendmentof the LGC because it is the only way for theIRA distribution to be redesigned. Accord-ing to Dr. Manasan, the amendment of theLGC is long overdue and there are moves togradually amend the LGC giving priority toBook 2 or the fiscal part.

Dr. Manasan, meanwhile, also said that thesecond-best reform involving matching grantprograms may likewise be considered. Thiswill ensure that LGUs acquire the appropri-ate financing for them to accomplish keybasic social services even at the minimumservice standard level.


Overdependence of LGUs in the IRA, evenif they now have the power to raise local taxrevenues, hinders the performance of theLGUs, as raised by Dr. Venancio del Rosario,Secretary of the Sangguniang Panlalawiganng Cagayan. With that, he shared with fellowparticipants his campaign of monitoring theprograms and projects of the SangguniangPanlalawigan to ensure that public funds arewisely spent.

Another forum attendee, Ms. Elita Dayag,representative from the Tuguegarao CityCouncil, opined that vesting additional tax-ing power to LGUs does not automaticallymake them more responsible, particularly inusing their funds.

Dr. Manasan, however, said that experiencesin other countries suggest that the grantingof more taxing powers to LGUs promotegreater accountability. She added that LGUsbecome more economical in the use of theirresources that come from taxes that theythemselves raise. In addition, giving LGUsthe power to collect more taxes would alsomake them more accountable to providebetter social services to their constituentsbecause the latter tend to demand betterservices if and when asked later to pay moretaxes.

Further discussing the recommendation onmatching grant scheme, Dr. Manasan ex-pounded on the importance of a perfor-mance-based second-level grant that is dif-ferent from the IRA. In this scenario, an LGUmay be given more funding in exchange fora certain level of performance on servicedelivery.

In light of this, the status of the Philippineeconomy affects LGUs performances. Dis-cussing the findings of his paper PhilippineEconomy in 2008: Key Issues and Prospects,PIDS President Dr. Josef Yap enumeratedcertain factors that would probably lead toan economic slowdown in 2008.

Primarily, these would be the appreciationof the peso against the US dollar as a resultof the weakening of the dollar, and the trendof rising profit and falling wages. He also

added that the drop in output growth of in-dustrialized countries, more prominentlythe impending US recession, will also take atoll in the country’s economic performance.Other issues he cited are the low investmentrate and the decline of government infra-structure programs.

Ms. Perla Vissoro of the Cagayan Valley Part-ners in People Development aired her con-cerns on the heightening poverty conditionsof Filipinos in contrast to an increasing GrossDomestic Product (GDP) rate. Dr. Yap saidthat the lack of investments from Filipinobusinessmen has been the problem. Invest-ments do create jobs and provide income forthe employed workers that could help allevi-ate their hardships. The private sector as awhole is open to invest but companies areconstrained with poor infrastructure andgovernance problems.

Mr. Archimedes Articulo of the Cagayan StateUnviersity, in reaction to the proposed frame-work recommending the shift to nonfarm ac-tivities, commented that instead, the govern-ment should invest more on agricultural de-velopment given that a significant percent-age of employment is in agriculture.

Dr. Yap explained that developing the agri-culture and nonfarm sectors are not mutu-ally exclusive but feed on each other. He em-phasized that the problem with agricultureis low productivity. Thus, there is a need tofind a way to employ workers in more pro-ductive activities.

More than 66 participants fromnongovernment organizations, the RegionalLegislative Assembly of Region 2, LGUs,academe, and the media, attended theresearch dissemination forum, which is aregular networking activity of the Institutein the various regions across the country.Primarily, it aims to provide a forum for PIDSstudies to be presented and discussed withstakeholders. Its purpose is to help LGUsand NGOs in their planning, policymaking,and decisionmaking processes. Moreover, itserves as a tool for the continued linkage ofPIDS with various government agencies,private entities, and organizations in thecountry.CSM


Senate-PIDS economic forum tacklesagrarian reform

The year 2008 marks the expiration ofthe Comprehensive Agrarian ReformProgram (CARP), particularly its land

acquisition and distribution component.This would mean that government’s pur-chase of private lands to be distributed totenants and agricultural workers will cease.Justifications of the possible program exten-sion are necessary for this controversial is-sue.

In view of this, the Senate Economic Plan-ning Office (SEPO), in partnership with thePhilippine Institute for Development Stud-ies (PIDS) and the Senate Committee onAgrarian Reform, held a forum titled “Insti-tutional Assessment of CARP in a Post-2008Transition Scenario” on March 5, 2008 at theTañada Room of the Philippine Senate.

The discussion on the CARP focused onthree major issues: land administration andmanagement (LAM) presented by PIDS Se-nior Research Fellow Dr. Marife Ballesteros;rural development architecture presentedby former Vice Chancellor for Planning and

Development at the University of the Phil-ippines Los Baños Dr. Fermin Adriano; andagrarian justice presented by Atty. MarvicLeonen, Dean of the University of the Phil-ippines College of Law (see related banner ar-ticle-Ed.).

Dr. Marife Ballesteros, PIDS Senior Re-search Fellow, pointed out the critical roleof effective land administration and man-agement in the successful implementationof land reform in the country, emphasizingthat land administration issues continue tochallenge CARP due to problems on landtitling, land valuation, and illegal convey-ance of lands awarded under the program.

Dr. Adriano, on the other hand, stressed theneed to explore possible institutional ar-rangements among the Department ofAgrarian Reform (DAR), Department ofAgriculture (DA), and the Department ofEnvironment and Natural Resources(DENR) that will provide better coordina-tion with local government units and effec-tive delivery of support services to small farm-ers.

In terms of agrarian justice concerns, Atty.Leonen highlighted the need for compul-sory arbitration as the principal mode tosettle disputes among three out of six typesof conflicts in the agrarian sector rather thanthe traditional process of adjudication.

Based on the discussions on the three ma-jor CARP issues, should the program beextended? The proposed program exten-sion still depends on the approval of theCongress. What matters is not just the con-tent of the program but the actual execu-tion that would essentially and equally ben-efit all the agrarian groups, particularly theland tenants and small farmers.APQ

The assessment of the CARP focused on three major issues:land administration and management (LAM), rural develop-ment architecture, and agrarian justice.


PIDS Senior Research Fellow, Dr. Gil-bert Llanto, continues his summon fora reformed build-operate-transfer

(BOT) Law.

In a joint Congressional Planning and Bud-get Department (CPBD) and PIDS seminaron improving BOT governance held at theMinority Conference Room of the House ofRepresentatives (HOR) on March 14, Dr.Llanto emphasized that governance on thereview and approval of infrastructure projectsshould be immensely improved. He said thatas early as the initial stage of a BOT process,project quality is put at stake because gov-ernment agencies bear problems such aslack of technical capacity, insufficient legaland financial expertise, and lack of projectdevelopment funds.

These drawbacks, according to Dr. Llanto,are manifested by the following results: lackof projects for competitive bidding, creationof a window for unsolicited proposals, andmultiplicity of unsolicited bids backed bystrong private proponents.

It is emphasized that competitive bidding isthe rule of law; however, in reality, this ishardly followed. Along this line, Dr. Llantocited BOT projects that have failed or havebecome controversial; mostly those devel-oped under less transparent terms or havebeen awarded to incompetent bidders.

Contract writing is another issue that Dr.Llanto pointed out, saying it actually impairsBOT projects because implementing agen-cies do not have the skills for contract writ-ing. This is even worsened by lack of moni-toring during implementation. “Apart fromcontract writing issues, the procedures forcontract approvals and amendments are aconcern,” Dr. Llanto said.

He likewise stressed the importance ofimplementing the traditional process of ap-proving BOT projects wherein oversightagencies headed by the NEDA-ICC are re-sponsible for project review and approval,while line agencies are responsible for iden-tifying and preparing project proposals.

He further explained that conflict-of-inter-est situations and breeding grounds for cor-ruption are created when line agencies arethe ones identifying, selecting, and approv-ing projects, as what has been recently pro-posed. He strongly suggested that competi-tive bidding procedures should remain asthe central tenet of government procure-ment policy so that the government—thepublic—will actually get value for its money.

Lastly, Dr. Llanto called on policymakers whobelieve that unsolicited proposals should beretained, saying that detailed project propos-als should be reviewed and approved onlyunder a competitive process. Unsolicitedproposals should be rejected because theyare breeding grounds for nontransparentnegotiations.APQ

PIDS expert calls for reforms onBOT law

Policymakers in attendance during the forum are (fromleft) Congressman Eduardo Joson of Nueva Ecija 1stDistrict, Congressman Henry Teves of Negros Oriental3rd District, Congressman Junie Cua of Quirino, andCongresswoman Luz Ilagan of the Gabriela Partylist.


DEVELOPMENT RESEARCH NEWSVol. XXVI No. 3May - June 2008

ISSN 0115 - 9097

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have recommended policy measures that wouldaid in improving its implementation and make tar-gets for the succeeding phase, if approved, morerealistic and attainable.

Various sectors look at CARP with different per-spectives and offer contrasting opinions and ar-guments, depending on their interests and rolesto play. Politics also takes center stage especiallywith an issue as controversial and broad in scopeas the CARP.

A genuine land reform program is one way to helpthe government in its efforts to alleviate poverty.To make the CARP work, however, critical reformsin its enabling law, backed by a strong politicalwill so that it can truly benefit its intended ben-eficiaries, should accompany the program, if andwhen an extension of the program takes place.

Whatever the decision is—either an extension ortermination—we should all be one in saying thaton a broader perspective, there is a need to winthe battle against poverty.

Editor's notes...from p. 1○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

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PIDS joins the nation in the fightagainst poverty.

Human Capital and Developmentin the Philippines:

A Festschrift in Honor ofAlejandro N. Herrin

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Documents

Vol. XXVI No.3 Editor's Notes Post-2008 CARP · delay coverage of their lands in the agrarian reform program, according to Atty. Leonen, Dean of the College of Law, University of