Excess gov’t execs cost taxpayers P58 M a year

Excess gov’t execs cost taxpayers P58 M a year
Written by Jesus Llanto
Wednesday, 20 May 2009


The Office of the President has the most number of excess—unqualified—undersecretaries and assistant secretaries

The government could save as much as P58 million a year if it would remove all the redundant executives from the bureaucracy, a study by the United Nations Development Programme (UNDP) showed.

The 2008/2009 Philippine Human Development Report (PHDR), which was launched Wednesday in Quezon City, counted as many as 81 unneeded undersecretaries and assistant secretaries, most of them with the Office of the President.

More than half of these excess executives are unqualified for their positions, the study said.

The PHDR, called “Institution, Politics and Human Development,” said that aside from excess officials, the following factors have also undermined the quality of the bureaucracy at all levels in recent years: appointments made for political accommodation, an outdated compensation scheme, and the surge in the number of ad-hoc bodies, presidential consultants, and advisers.

The study noted that while only 131 undersecretaries and assistant secretaries are prescribed by law, the government had 222 incumbent employees occupying these positions as of December 2007. The figure represents an excess of 62 percent.
Ineligible

“If each draws an average of P722, 000 a year in salaries, allowances, and discretionary funds, then theses excess cost government an extra P58 million a year,” the study said.

The report also noted that more than half (56 percent) of these 222 department executives were “technically ineligible” to occupy their positions.

The Office of the President, the PHDR said, had the most number of excess undersecretaries and assistant secretaries at 31. Eighty-nine percent of them were ineligible for the position.

The study also said that the number of ad-hoc bodies and presidential advisers and consultants significantly increased in recent years.

“After peaking in 2002 at 175, there was a sharp decline in 2003 to 74 [ad-hoc bodies], attributed to the work of the Presidential Commision on Effective Governance (PCEG),” the study said. After the abolition of the PCEG in 2004, the number of ad-hoc bodies increased again and reached 85 in 2007.
Demoralizing

The significant increase in the number of consultants and advisers, meanwhile, started in 2002. Under the Ramos administration, the number of presidential consultants declined from 33 in 1994 to 27 in 1998. It reached 34 under the Estrada administration, but declined sharply to 15 during the early years of the Arroyo administration.

“The number of presidential consultants/ advisers has risen significantly since 2002, reaching an all-time high of 49 in 2008,” the study noted.

The study also warned against the creation of additional positions of presidential consultants and advisers. “Presidential consultants and advisers enjoy the title and authority, without accountability.”

Toby Melissa Monsod, one of the authors of the PHDR, said these appointments cause demoralization and destruction of initiative in the regular civil service.

“The practice of appointing non-career and non-eligible people into formal plantilla positions undermines the constitutional notion of ‘merit and fitness,’” Monsod said. She pointed out that about 10,000 positions are subject to presidential prerogative, which allows politicians to intervene in appointment process.
‘Perverse Incentives’

The study also identified the outdated compensation scheme as a factor in weakening the quality of government personnel. Paying low salaries, the government fails to retain its competent workers.

The government is the country’s biggest direct employer with 1.4 million workers.

“Perverse incentives in the civil service have weakened the quality of the bureaucracy at all levels in recent years,” the study said, adding that the compensation package for government employees pale in comparison with their peers in the private sectors.

“Salaries can be as much as 74 percent below comparative jobs in the private sector,” the study said, quoting a 2006 study by the Civil Service Commission.

“Most affected are directors, district engineers, school superintendents, college professors, prosecutors, state auditors, assistant secretaries, undersecretaries...people responsible for policy design, higher-level technical services, and the day-today management of the government,” the study said.

Other government positions suffering from low salaries are division chiefs, public lawyers, school principals, public health nurses, social workers, teachers, election officers, customs examiners, engineers, agriculturists, and those who are directly involved in the implementation of public programs.

The study said that there is a need to pass a law that would provide a new government classification and compensation scheme to restore professionalism and meritocracy in the bureaucracy.

Proposals for new salary standardization laws are pending in Congress. The proposed legislations seek to increase the salaries of government personnel and remove overlaps in salaries between positions, which resulted in instances where some subordinates receive higher salaries than their supervisors. (Newsbreak)

Philippines least competitive in Asia; graft blamed

RP least competitive in Asia; graft blamed

By Michaela P. del Callar

Daily Tribune 05/21/2009

The country slipped anew in terms of its global competitiveness ranking 43rd out of 57 countries in the World Competitiveness Yearbook that Swiss business school IMD released yesterday.

Among 12 Asian countries on the list, the Philippines got the poorest ranking with Hong Kong considered as the world’s second most competitive country, next to the United States. Singapore ranked 3rd; Japan, 17th; Malaysia, 18th; China, 20th; Taiwan, 23rd; Thailand, 26th; Korea, 27th; India, 30th; Kazakhstan, 36th, and Indonesia, 42nd.

The Philippines’ competitiveness grade had regressed the past five years having been ranked 40th in 2005, 42nd in 2006, 45th in 2007 before improving to 40th last year.

What’s more telling was that IMD ranked the economic performance of the country at 51st out of 57 this year despite President Arroyo’s continuous harping about her administration’s focus on uplifting the economy.

The economic performance of the country had deteriorated progressively since 2005 when it was ranked 36th, 45th in 2006 and 2007, and 42nd last year.

On government efficiency the Philippines was ranked 42nd, on business efficiency, 32nd and infrastructure second to the last at 56th.

Aside from perceptions of corruption, a weak government institution was blamed for the dismal ranking of the country in the annual competitiveness ranking.

A United Nations report echoed the IMD findings, saying weak congressional oversight on foreign aid

and national budget facilitates corruption in the country.

In the Philippine Human Development Report for the period 2008-2009, it said that “loopholes” in the current budget law give the executive and not congress the “power of the purse.”

It added that the President can override congressional budget mandates in a number of ways by not releasing or delaying the release of authorized appropriations and by using “savings” and “other unprogrammed, discretionary or confidential funds at will.”

The PHDR cited overwhelming amounts with savings ranging from P11.4 billion in 2004 t P117.5 billion in 2007.

Lump sums in the 2009 National Expenditure Program—defined as one-liner appropriations amounting to P100 million or more—amounted to P224 billion, or 16 percent of the proposed national budget. Confidential and intelligence funds amount to another P1.12 billion.

“Presidents can, and have restored programs scrapped by Congress by using ‘savings,’ lump sums or contingency funds,” the report said.

It lamented that mandatory obligations comprise more than 80 percent of the total annual budget on average, leaving little headroom to increase spending on basic services or fund innovations.

The report also pointed out that Congress plays a significant part in undermining its own powers, noting that when it fails to pass the national budget, the previous year’s budget is automatically re-enacted.

It said that there have been three fully re-enacted budgets since 2000, 2001, 2004 and 2006 and a few more being partially re-enacted.

“The re-enactment of a budget even strengthens the President’s control over allocations owing to larger savings that can be disbursed at his or her discretion,” the report said.

It also noted the lack of transparency in government agencies as they fail to submit quarterly financial reports in a complete and timely manner to Congress, the Commission on Audit, the Department of Budget and Management, and the Office of the President.

“One problem is the lack of any mechanism for systematic legal or administrative sanctions against such agencies, notwithstanding the oversight functions of the CoA,” the report said.

The report also cited many instances of unresolved “recurrent adverse audit findings” among national government agencies and corporations from the COA.

Five war-torn provinces in Southern Mindanao ranked lowest in the human development index due to lack of economic development, extreme poverty and thousands of displaced civilians due to ongoing hostilities between Muslim rebels and government troops .

At the bottom 10 are seven provinces from Mindanao, five of which are from the Autonomous Region for Muslim Mindanao (ARMM), the report that covers the country’s 77 provinces and Metro Manila released yesterday said.

Sulu, a stronghold of Muslim militants and a battleground for Philippine armed forces and rebels, was retained in the last spot, followed by Tawi-Tawi, Maguindanao, Basilan and Lana del Sur. Their performance in human development is comparable to Ghana, Mauritania, Nigeria, Pakistan and Senegal.

“As human insecurity increases from armed conflict, people turn away from those social and activities that could have facilitated the development of their human potential,” the report said.

“Lives are destroyed, families and communities torn apart, cultures decline, and investment is foregone or deflected. Development in the immediate are stagnates and, through spillovers, the entire region and perhaps the entire country is affected,” it added.

Previous Philippine human development reporters dating back to the mid-1990s have consistently shown that the bottom 10 provinces in almost every aspect of human development are the most conflict-ridden.

New to the bottom 10 are Eastern Samar and Romblon and graduating from the lowest ranking provinces list are Agusan del Sur, Northern Samar and Surigao del Sur.

Provinces in Luzon led by Bataan, Benguet, Cavite and Rizal topped the human development rankings. Completing the top ten are Batanes, Ilocos Norte, Laguna, La Union, Nueva Vizcaya and Pampanga.

Human development levels increased for 51 provinces and declined for 27, including Metro Manila.

Benguet, Biliran and Siquijor were cioted as “the most improved in human development,” while the top ten provinces performed well in the gender-development index.

Overall, the Philippines is classified as a medium human development country, along with other Asian states like China and Thailand, ranking 90th out of 177 countries. Highest ranked countries are Australia, Canada, Japan, Iceland, Ireland, France, Netherlands, Norway, Sweden and Switzerland.

In terms of health, the estimated life expectancy at birth of the Philippines is 71 years, or 3.5 years above the average for medium-ranked countries. For simple literacy rate, the Philippines has 92.6 while real per-capita incomes is at $5,137 or about five percent above the average of $4,876 for the group.

“This is an improvement over the past computations, where the Philippines’ real per capita income was below the group average,” the report said.