analysis...a case study of local government capacity development in the philippines agriteam canada...

European Centre for Development Policy ManagementCentre européen de gestion des politiques de développement

John SaxbyPretoria, South Africa

The Philippines - Canada Local Government Support ProgramA case study of local government capacitydevelopment in the Philippines

Agriteam Canada Consulting Ltd

A case study prepared for the project ‘Capacity, Change and Performance’

Discussion Paper No 57NApril 2006

Analysis

The lack of capacity in low-income countries is one of the mainconstraints to achieving the Millennium Development Goals.Even practitioners confess to having only a limitedunderstanding of how capacity actually develops. In 2002, thechair of Govnet, the Network on Governance and CapacityDevelopment of the OECD, asked the European Centre forDevelopment Policy Management (ECDPM) in Maastricht, theNetherlands to undertake a study of how organisations andsystems, mainly in developing countries, have succeeded inbuilding their capacity and improving performance. Theresulting study focuses on the endogenous process of capacitydevelopment - the process of change from the perspective ofthose undergoing the change. The study examines the factorsthat encourage it, how it differs from one context to another,and why efforts to develop capacity have been more successfulin some contexts than in others.

The study consists of about 20 field cases carried out accordingto a methodological framework with seven components, asfollows:• Capabilities: How do the capabilities of a group,

organisation or network feed into organisational capacity?• Endogenous change and adaptation: How do processes of

change take place within an organisation or system? • Performance: What has the organisation or system

accomplished or is it now able to deliver? The focus here ison assessing the effectiveness of the process of capacitydevelopment rather than on impact, which will beapparent only in the long term.

External context Stakeholders

Internal features andresources

External intervention

The simplified analytical framework

Co r e va r i a b l e s

Capabilities

EndogenousChange andadaptation

Performance

Study of Capacity, Change and PerformanceNotes on the methodology

• External context: How has the external context - thehistorical, cultural, political and institutional environment,and the constraints and opportunities they create - influenced the capacity and performance of theorganisation or system?

• Stakeholders: What has been the influence of stakeholderssuch as beneficiaries, suppliers and supporters, and theirdifferent interests, expectations, modes of behaviour,resources, interrelationships and intensity of involvement?

• External interventions: How have outsiders influenced theprocess of change?

• Internal features and key resources: What are the patternsof internal features such as formal and informal roles,structures, resources, culture, strategies and values, andwhat influence have they had at both the organisationaland multi-organisational levels?

The outputs of the study will include about 20 case studyreports, an annotated review of the literature, a set ofassessment tools, and various thematic papers to stimulatenew thinking and practices about capacity development. Thesynthesis report summarising the results of the case studies willbe published in 2005.

The results of the study, interim reports and an elaboratedmethodology can be consulted at www.capacity.org orwww.ecdpm.org. For further information, please contactMs Heather Baser ([email protected]).

The Philippines-Canada Local Government Support Program

A case study of local government capacity development in the Philippines

A case study prepared for the project 'Capacity, Change and Performance'

April 2006

AcknowledgementsThis paper was prepared by Alix Yule, programme director of the Philippines-Canada Local GovernmentSupport Program, Agriteam Canada, with research support provided by Pamela Mitchell of Agriteam Canadaand Christine Garrucho of the Galing Pook Foundation. The assistance provided by LGSP field managers MarionVillanueva and Basile Gilbert and DILG assistant secretary Austere Panadero in gathering information is grate-fully acknowledged. The guidance of Peter Morgan, chief researcher for the ECDPM study on Capacity, Changeand Performance, in preparing the paper is appreciated. Financial and technical support to prepare this paperhas been provided by the Canadian International Development Agency and ECDPM.

Capacity Study Analysis Discussion Paper No. 57N

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ContentsAcknowledgements iiAcronyms ivSummary v

1 Introduction 1

2 External context 2

3 Stakeholders and systems 5

4 Internal organisational features and resources 9

5 Capacities 13

6 Endogenous organisational change and adaptation 166.1 Stage 1: Consensus 176.2 Stage 2: Strengthening capacities 176.3 Stage 3: Application 186.4 Stage 4: Institutionalisation 18

7 External intervention 217.1 LGSP success factors 237.2 Enabling environment - meso and macro level results 26

8 Performance 28

9 Conclusion 31

Appendix: List of interviewees 32

Bibliography 33

The European Centre forDevelopment Policy ManagementOnze Lieve Vrouweplein 21NL-6211 HE Maastricht, The Netherlands Tel +31 (0)43 350 29 00Fax +31 (0)43 350 29 [email protected] www.ecdpm.org

Agriteam Canada Consulting Ltd200, 14707 Bannister Road S.E.Calgary, Alberta T2X 1Z2, CanadaTel: +1 (403) 253-5298Fax: +1 (403) 253-5140

Discussion Paper No. 57N Capacity Study Analysis

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ADB Asian Development BankAIM Asian Institute of ManagementARMM Autonomous Region in Muslim MindanaoAusAid Australian Agency for International DevelopmentCD capacity developmentCIDA Canadian International Development AgencyCLRG Centre for Local and Regional Governance CSO civil society organisationDAC Development Assistance Committee (OECD)DILG Department of the Interior and Local Government (Philippines)EA executive agendaECDPM European Centre for Development Policy ManagementELA Executive and Legislative AgendaFCM Federation of Canadian MunicipalitiesGoFAR Governance Facility for Adaptation and Replication of exemplary practice HRD human resource developmentIRA internal revenue allotmentsLGA Local Government Academy (DILG)LGPMS Local Government Performance Measurement SystemLGU local government unitLGSP Local Government Support ProgramLGSPA Local Governance Support Program in the Autonomous Region in Muslim MindanaoLOGIC Local Governance Institutional Capacity DevelopmentLPPMS Local Productivity and Performance Measurement SystemLRP local resource partnerNEDA National Economic and Development Authority (Philippines)NGO non-governmental organisationNPMO National Programme Management Office OECD Organisation for Economic Cooperation and DevelopmentOD organisational developmentPIS performance information systemUNDP United Nations Development ProgrammeUSAID United States Agency for International Development

Acronyms


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SummaryThis paper explores capacity development andrelated performance improvement within the con-text of local governance in the Republic of thePhilippines over a 13-year period. It focuses on thedevelopment of 'local government units' (cities andmunicipalities) that in the Philippine political struc-ture are a second tier of government with specificfunctions devolved to them by the central govern-ment. The paper describes the local governmentunits and the enabling and regulatory environmentin which they function as a system that is evolvingand becoming stronger at the same time as theindividual local government units are developing.The concept of capacity development presented inthe study is an open systems model that considerscapacity development as an ongoing process that inthe case of Philippine local governments has led torelated improvements in local government perform-ance that in turn have resulted in better servicesand benefits to citizens.

The case draws mainly on the experience of twoexternal agents with different but complementarymandates to improve local government perform-ance in the Philippines: (i) a donor-assisted project,the Philippines-Canada Local Government SupportProgram funded by the Canadian InternationalDevelopment Agency (CIDA), and (ii) a nationalagency of the government of the Philippines - theDepartment of the Interior and Local Government -mandated to support local government develop-ment.

The paper suggests that given the political andsocial context conducive to devolution and democ-ratisation that existed in the Philippines after thefall of the Marcos regime, and the enabling policyenvironment created by the enactment of the LocalGovernment Code in 1991, endogenous local gov-ernment capacity development began to occur. Italso suggests that certain external interventionswere very effective in supporting and enhancingthis endogenous local government capacity devel-opment process because of the specific approachesand methodologies that characterised these exter-nal interventions.

An analysis of the success of the Local GovernmentSupport Program in catalysing local governmentcapacity development concludes that the keys tosuccess include:

• the broad scope and long timeframe of the pro-gramme;

• the expertise of the Filipino and Canadian pro-gramme managers, advisors and staff related tocapacity development, local governance and pro-gramme management;

• the use of appropriate and innovative capacitydevelopment strategies and methodologies; and

• the embeddedness of programme activitieswithin local, regional and national local govern-ment strengthening efforts, thereby enhancingendogenous processes rather than introducingexternal solutions.


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carry out their newly mandated functions. The nation-al government and local government officials them-selves identified the urgent need for capacity develop-ment and capacity development assistance for localgovernment units. The national government chargedthe DILG with responsibility to develop the capacity oflocal governments and invited donor assistance. Since1991 many national government initiatives and donor-assisted projects have supported local governmentcapacity development with one of the most successfulbeing LGSP.

LGSP represents a long-term commitment on behalf ofCIDA to support the Government of the Philippines'decentralisation and poverty reduction strategies. It isa major component of CIDA's official developmentassistance programme to promote democracy andgood governance in the Philippines. The programmehas been implemented in two phases, phase I from1991 to 1998, and phase II from 1999 to 2006. Bothphases have been funded jointly by CIDA bilateralbranch and by the Philippines-Canada DevelopmentFund, a fund established through the monetisation ofCanadian commodities and administered by a Boardof Directors made up of representatives of CIDA andthe Philippine National Economic and DevelopmentAuthority (NEDA). Total expenditure for the pro-gramme is approximately CDN$60 million, $30 millionfor each phase. Phase I, managed directly by CIDA andadministered by Filipino consultants and NEDA offi-cials, assisted more than 300 local government units(municipalities, cities and provinces) in Mindanao andWestern Visayas in the southern Philippines. Phase II,managed by a Canadian executing agency, AgriteamCanada, in collaboration with the Federation ofCanadian Municipalities, supported over 200 local government units in the same provinces as phase Iand, in addition, supported development of the'enabling environment' by assisting various organisa-tions and institutions within the local governance system at regional and national levels.

Although this case study is primarily about developingthe capacity of local governments as organisations, theterm local governance is used instead of local govern-ment to reflect the LGSP and DILG position that ifeffective local government is to be realised, in additionto assisting local government units, it is necessary toenhance the capacity of community and citizen groupsto become involved in local government and tostrengthen the mechanisms that allow government-citizen interaction.

1 IntroductionThis case study has been developed as part of a largerstudy on capacity development undertaken by theEuropean Centre for Development Policy Management(ECDPM) for the OECD's Development AssistanceCommittee (DAC). It is one of 16 international casesthat the ECDPM analysed as part of its research, andthe study follows the general methodology set out bythe ECDPM researchers.

This case study explores capacity development withinthe context of local governance in the Philippines. Itdraws heavily on the experience of local governmentunits involved in the Philippines-Canada LocalGovernment Support Program (LGSP), a joint initiativeof the governments of Canada and the Philippines towork towards poverty reduction by strengtheninglocal governments and promoting good governance atthe local level. It also draws on the experience of theDepartment of the Interior and Local Government(DILG), the national agency of the government of thePhilippines mandated to oversee local governments'operations and promote their development.

The research for this case study was undertaken byLGSP staff and researchers provided by AgriteamCanada, the Canadian agency contracted by theCanadian International Development Agency (CIDA) tomanage the programme, and by the Galing PookFoundation, a Philippines Foundation that promotesexcellence in local governance primarily through theidentification of exemplary practice and a nationallocal government awards programme. The informationcontained in the paper was obtained from LGSP andDILG documents and reports, and interviews in thePhilippines with various local government officials,local governance experts, DILG, Galing Pook and LGSPstaff, and other local governance stakeholders.

BackgroundThe Republic of the Philippines has made significantprogress in decentralisation and democratisation overthe past decade. Its devolution legislation and localgovernment system are frequently studied by otherAsian countries as a model for decentralisation.However, the process has not been without chal-lenges. In 1991, when the Local Government Code wasenacted, few local governments had the capacity to


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This paper provides an overview of capacity develop-ment within the context of local governance in thePhilippines, focusing on the development of cities andmunicipalities, and examines the success of LGSP infacilitating the process. It suggests that the politicaland social context in the Philippines in the 1990s wasconducive to decentralisation and democratisation,and that LGSP and other initiatives to strengthen localgovernance were welcomed by the majority of stake-holders. It also suggests that certain characteristics ofLGSP, along with the approaches taken by LGSP man-agers and staff, enhanced the success of LGSP in sup-porting and enriching the endogenous change processthat was taking place within the local governance system in the Philippines at that time.

2 External contextIn the late 1980s, in the wake of the 1986 'PeoplePower' movement that ended the dictatorship ofPresident Ferdinand Marcos, the Republic of thePhilippines underwent significant political and socialreforms. The administration of incoming PresidentCory Aquino, and those of subsequent leaders, werepressured to make government more effective andaccountable, and to enact legislation that would pre-vent a repeat of a Marcos-style regime. The businesscommunity and the educated and professional middleand upper classes that had been instrumental in thepeaceful revolution to overthrow President Marcosdemanded legislation that would limit the power ofthe president, restrict the use of martial law and makegovernment more responsive to the people. They weresupported by civil society leaders eager to establish amore grassroots form of governance.

Politically, the new government could not ignore public demand from the leaders of the People Powermovement. Nor could it fail to reward powerfulregional leaders who had been supportive of thepeaceful revolution that brought the new adminis-tration to power. Decentralisation and devolutiontherefore became a key component of the nationalgovernment's strategy to provide more democratic,responsive and accountable governance. Devolvingpower to local authorities (especially to provincial governors) allowed the central government to respondto public demand for power sharing, to reward key

supporters, to develop a regional power base for theadministration, and to reduce competition at the centre.

Geographically and historically, the Philippines is acountry of separate island groupings and small 'king-doms' or 'sultanates', rather than a tightly knit unitarystate. There was therefore little public opposition todecentralisation and devolution to provinces, citiesand municipalities. Resistance was limited to centralgovernment departments that were disinclined toshare power and resources with lower levels of government.

With the assistance of several 'think tanks', legislationwas developed to decentralise government functionsand devolve selected powers and responsibilities toregional and local levels. The reforms included exten-sive devolution to local government units (provinces,cities, municipalities and barangays), as well as effortsto increase the accountability of local governmentsthrough local elections and increased citizen participa-tion in decision-making processes. The reforms werewidely supported by the local chief executives (gover-nors and mayors) who were eager to gain more powerand autonomy. Organised into associations, or'leagues', the city and municipal mayors, and provincialgovernors, lobbied along with NGOs and key nationalpoliticians for decentralisation and devolution. On 10October 1991, the Local Government Code (RepublicAct 7160) was enacted, decentralising powers, authori-ty, responsibilities and resources to local governments.A comprehensive piece of legislation, the code is fre-quently studied as a model by other countries in Asia.

The Philippines has a three-tier system of local govern-ment. The highest tier consists of 79 provinces; thesecond tier comprises approximately 200 cities and1500 municipalities; and the third tier is made up ofover 40,000 barangays (villages/wards). Provinces,cities and barangays are referred to as local govern-ment units (LGUs), each of which has an elected localchief executive and a council of elected representa-tives. Provincial local chief executives are governors,cities and municipalities have mayors, and barangayshave barangay captains. All local government chiefexecutives and council members are elected for athree-year term of office in elections managed nation-wide by a national elections commission.


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The Local Government Code has four outstanding fea-tures:1 it grants local government units significant regula-

tory powers, including land classification and com-munity-based forestry and fisheries;

2 it devolves to local government units the responsi-bility for the delivery of basic services (e.g. agricul-ture extension, public works, health, housing, socialwelfare, tourism and investment promotion);

3 it increases financial resources available to localgovernments through increased internal revenueallotments from national wealth and the grantingof authority to mobilise resources through taxa-tion, credit financing and other public and privatesources; and

4 it recognises and encourages the active participa-tion of the private sector, NGOs and people'sorganisations in the process of governance. TheDILG was designated as the lead national agencyfor the implementation of the code.

Not surprisingly, when the code was implemented in1991, many local governments lacked the capacity tocarry out their enhanced mandate. Although thePhilippines has a long history of indigenous local governance and traditional forms of local leadership,over three centuries of colonial rule followed by mar-tial law under Marcos had left a legacy of centralisedpublic administration and weak local governmentauthorities. Local elections were frequently flawed byvarious forms of vote rigging and intimidation, andoffices were usually held by powerful families that'inherited' local positions and left planning and devel-opment programming to national authorities.Decisions of a local nature were often influenced moreby patronage and power brokering among politicalfamilies and rebel leaders than by community needs.

In recognition of the need to strengthen local govern-ments for their role in a more decentralised and demo-cratic system, the government of the Philippinesrequested development assistance from various donorcountries and organisations. Several donors respond-ed, including Canada, which signed a Memorandum ofAgreement to initiate LGSP in October 1991. The pro-gramme was designed to support the efforts of thegovernment of the Philippines and participating localgovernments to develop capacity for effective localgovernance. Other initiatives to support local govern-ment development were funded by other donorsincluding Australia, Germany, the United States, theAsian Development Bank (ADB) and UNDP.

With the social and political context ready for devolu-tion and democratisation, the major enabler forchange within local governance in the Philippines wasthe enactment of the Local Government Code. Thecode set the stage for the evolution of local capacitiesin a number of ways:

• It initiated an era of local government units asmandated service providers. Prior to the code,services were delivered by national agencies;afterwards LGU officials began to think abouthow to deliver better services and how tomobilise the resources to do so. This motivatedLGU officials to join forces with other LGUs andlevels of government, community groups and theprivate sector, and to look for examples of innova-tion and best practices to help address their service delivery challenges.

• It stimulated a change in local officials' perspectiveon leadership from one of 'patron' to one of 'devel-opment manager'. By granting LGUs authority tomobilise resources and generate revenue, andresponsibility for development planning, the codeprompted discussion about local self-reliance andautonomy. Some local leaders began to develop avision for a better future for their communities.Many became personally motivated to leave a lega-cy of social and/or economic improvement.

• It invited cooperation and collaboration betweenthe local government and its constituents includ-ing civil society organisations, the private sectorand the citizenry at large. Before the code, thenational government set the business climate;afterwards LGUs were able to formulate theirown policies to attract and regulate private businesses. The code also mandated civil societyparticipation in 'local special bodies' including thepolice, health and education boards and localdevelopment councils.

The demand for capacity development (CD) assistancefrom governors, mayors and other LGU officials grewsteadily as they struggled to implement the code andcarry out their newly devolved responsibilities. Theneed to strengthen LGU capacity was also voiced bynational line agencies concerned about devolving serv-ices to unprepared provinces, cities and municipalities.

Gradually, national line agencies began to relate toLGUs differently. Initially not prepared for devolution,they were reluctant to share power and resources withLGUs. Frequently LGUs were required to implement


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national government programmes without correspon-ding funding, and with little or no inputs into pro-gramme design. National line agencies played an over-sight and regulatory role in relationship to LGUs,focusing on ensuring compliance with national poli-cies and standards. As LGUs became more self-reliantsome national agencies, particularly the Departmentof the Interior and Local Government (DILG), havebegun to see their relationship with LGUs becomemore facilitative and enabling of LGUs own program-ming efforts, including the LGUs' own efforts to devel-op capacity.

A second motivator for change came from civil socie-ty organisations (CSOs) and NGOs, which demandedthat local governments be more responsive, transpar-ent and accountable. The Philippines has a long his-tory of community organising, and the 'PeoplePower' movements or 'Edsa revolutions' that over-threw President Marcos in 1986 and PresidentEstrada in 2001 by mass peaceful public demonstra-tions were organised in part by powerful PhilippineCSOs and NGOs demanding more transparent,accountable and less corrupt government at thenational level. After these events, CSO and NGOumbrella groups encouraged their members to makesimilar demands at the local level. CSOs and NGOs,especially in some of the larger urban areas, began toput pressure on local governments for good gover-nance, improved performance and increased publicparticipation in local affairs. During the '10-10-10' celebrations marking the tenth anniversary of theLocal Government Code in October 2001, CSOs andNGOs organised a series of events to draw publicattention to the increase in CSO participation in localgovernance and the resulting benefits to communi-ties since the enactment of the code, as well as tothe barriers and challenges still being faced.

Increasing civil society participation in local gover-nance required a shift in CSO and LGU thinking andapproach. During the Edsa revolutions CSO and NGOrelationships with government were adversarial. CSOmembers and government officials did not trusteach other and had no experience in working togeth-er collaboratively. Many CSOs viewed local govern-ment officials as corrupt and many elected LGU offi-cials saw CSOs as a threat to their leadership andpower base. Both parties needed to develop thecapacity to engage critically, cooperatively and pro-ductively with each other.

A number of organisations and institutions were cre-ated or strengthened to respond to the demand fromLGUs, national government agencies and CSOs for LGUcapacity development. The Local GovernmentAcademy, the training and research institute of DILG,was established to meet the demand for CD supportby offering courses for newly elected local officials,organising CD training for DILG officers assigned towork in LGUs, and providing a variety of LGU resourcematerials. The Academy also coordinates and encour-ages local academic, training and research institutionsthat provide CD services to LGUs.

Since 1991 the local government sector in thePhilippines has matured in response to decentralisa-tion and devolution as set out in the LocalGovernment Code. LGUs have made significantprogress in contributing to the social and economicdevelopment of their localities through exercisingthe powers, performing the functions and deliveringthe services devolved to them. In October 2001, dur-ing the 10-10-10 celebrations, the DILG Secretaryacknowledged the significant improvements thathad occurred in local governments since the promul-gation of the code and noted the many innovativeefforts of LGUs to enhance their organisationalcapacities to perform their functions. At the sametime he acknowledged that much still needed to bedone to assist LGUs. Despite the significant numberof success stories in various cities and municipalitiesthroughout the country, the majority of PhilippineLGUs continued to struggle to provide programmesand services that would reduce poverty and conflict,and promote peace, social well-being and economicdevelopment. In planning and carrying out theirresponsibilities, LGUs continue to be hampered by anumber of constraints including inadequate capacity,insufficient resources and non-conducive nationalpolicies.

One of the most significant problems faced by localgovernments, especially the smaller ones, concernsfinance - the generation of revenue and its effectivemanagement. There are still many concerns about thequality and accessibility of services delivered by localgovernments, and many LGUs are struggling to findsufficient resources to address their constituent'sdemands. By far the most significant source of localrevenue, especially for smaller LGUs, is transfers fromthe national government, mostly in the form of inter-nal revenue allotments (IRA). IRA-related issues includethe uncertainty associated with IRA transfers given the


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Autonomous Region in Muslim Mindanao has thehighest incidence of poverty, at 60%, compared withonly 6% in the national capital region.

Thus, local governments in the Philippines are chal-lenged to address an increasing demand for publicservices within a context of poverty and conflict. Theyare hindered in their efforts by lack of capacity andresources as well as policy bottlenecks. Local govern-ments themselves, as well as the national govern-ment and various other stakeholders, are attemptingto address these challenges.

3 Stakeholders and systems

The local governance system and stakeholders aredepicted in figure 1. Adapted by LGSP from theFederation of Canadian Municipalities' MunicipalGovernance Framework, it illustrates the various ele-ments of the system in the Philippines. The frameworkdescribes an open system comprised of a governedarea and two entities: the local government and thecommunity. Stakeholders within local governmentsand communities communicate, cooperate and makechoices through systems of relationships and mecha-nisms called 'governance links' The local governmentsexist in a particular legal, regulatory and institutionalenvironment (called the 'enabling environment')where DILG is a strategic actor.

There are also linkages between the local govern-ment and the community and the enabling environ-ment. More specifically, key elements of the localgovernance system include:

Local government units (LGUs). These include theprovincial, city, municipal and barangay governments.Stakeholders include local chief executives (provincialgovernors, city and municipal mayors and barangaycaptains) and other elected officials and staff of theseLGUs who are responsible for carrying out four keyfunctions: providing strategic leadership, managingfinances and operations, providing services to thecommunity for social and economic development andenvironmental protection, and promoting public par-ticipation in governance.

insecure national fiscal situation and inequities anddistortions in distribution built into the IRA formula.Local government financial affairs are highly politi-cised and revenue and spending decisions are fre-quently taken to attract or deflect political attention.Fiscal management is also often hampered by the lackof adequate records or automated systems.

The non-conducive national policy environmentstems from the fact that despite the efficacy of theLocal Government Code, many national governmentdepartments directly or indirectly influence localgovernment functioning. The decentralisationprocess has meant that in addition to the 'oversight'agencies such as the Departments of Finance, Budgetand Management, and of the Interior and LocalGovernment, several 'line' departments such as theDepartments of Social Welfare, Agriculture, andHealth direct how local governments disburse funds,deliver programmes and provide services. There aremany instances where policies initiated by thesedepartments contradict the Local Government Code.Several unsuccessful attempts have been made toinitiate changes to the code, but to date the codeand its implementation have not been formallyreviewed or revised.

A final element of the external context in which localgovernments function in the Philippines is the ongo-ing armed conflict between the national governmentand rebel groups. This includes the NPA, a communistinsurgency active in several regions, and the MILF, aMuslim separatist group active in most of Mindanao.About 30% of municipalities are affected by somedegree of armed conflict.

Despite efforts by all levels of government, poverty inthe Philippines is increasing. Both the percentage ofthe population deemed poor and the number of poorpeople who cannot afford to meet their basic foodrequirements have increased in recent years. At thesame time, the Philippines has one of the highestpopulation growth rates in the region. There are sig-nificant inequalities in the distribution of wealth andthe incidence of poverty within the country. Themajority of poor people live in rural areas where theincidence of poverty is 50%, compared with 34%nationally. The Gini coefficient is one of the highestin Asia at 0.4822, indicating a wide gap betweenupper and lower income groups. The poverty inci-dence also varies widely by region, with the poorestprovinces being in Bicol and Mindanao. The


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Community. Stakeholders include civil society, non-governmental and people's organisations, the privatesector and individual citizens who, in a democraticsociety, play an important role in governance and inbuilding and maintaining community well-being.Many Philippine communities also include tradition-al and alternative forms of local leadership such asreligious councils, tribal elders, clan leaders, rebelgroup commanders, and senior military officers whowield considerable political power and are involvedin local decision making.

Governance links. These represent the necessaryparticipatory, equitable, responsive, culturallyappropriate, accountable and transparent interac-tions between the government and the communityto achieve mutually determined goals. These linksinclude such things as local special bodies (mandat-ed sector advisory boards), traditional and consulta-tive mechanisms for participation, and public-pri-vate partnerships.

Enabling environment. Stakeholders includeenabling institutions, such as regional and nationalgovernment agencies, local government leagues(municipal associations), NGOs, peace networks,research centres, universities, training institutes,etc. An appropriate policy and regulatory frame-work to orchestrate, support and direct governanceefforts towards a common agenda is a critical com-ponent of the enabling environment.

DILG has the mandated responsibility to providegeneral supervision over local governments, to promote local autonomy, to prepare legislationaffecting local governments and to strengthencapabilities of local government officers and per-sonnel. As such, DILG has been the most significantexternal stakeholder in influencing LGU capacitydevelopment.

Following the Local Government Congress in 2001,the DILG assistant secretary Austere Panadero, incollaboration with the Local Government Academy

Figure 1. Local governance framework in the Philippines.Adapted from Federation of Canadian Municipalities, 1997 (Carlton, 2000).

National Enabling Institutions

Regional Enabling Institutions

National Legal and Regulatory Framework

Regional Legal and Regulatory Framework

Province, City, Municipality, Barangay

StrategicLeadership

Finance &Operations

Services

Civil SocietyOrganisations

PrivateSector

Individuals

Governance Links

Public-PrivatePartnerships

Participation

Local Government Unit Community


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and with support from UNDP and LGSP, undertooka serious review of LGU performance and CD needs.He began to develop a framework and strategies toconceptualise and enhance system capacity andultimately improve performance. DILG identifiedseveral challenges confronting LGUs in their CDefforts:

• the need to continuously assist LGUs in enhanc-ing their capacity as the challenges they are facing continue to grow and change;

• the lack of coherence and duplication amongcapacity building programmes of various donorsand government agencies;

• uneven LGU development, with some LGUs andsome areas of the country performing betterthan others;

• inadequate policies to support CD;• inadequate performance measurement and

standards for CD programmes;• insufficient involvement of and coordination

among local governance stakeholders; and• their inability to sustain CD due to their limited

understanding of the concept and the limitedfunds available.

DILG conducted research regarding LGU CD andperformance management and has developed several programmes in response to the challenges.Led by Assistant Secretary Panadero, DILG devel-oped the Local Governance Institutional CapacityDevelopment (LOGIC) Facility to 'rationalise anddirect institutional capacity building efforts in localgovernance and institute mechanisms towards sustained, responsive and progressive CD amongkey stakeholders in local governance'. Beinginvolved in the development, implementation andreview of the LGSP frameworks and programminghelped DILG to articulate its own frameworks. TheFacility, launched in 2003, focuses on enhancing the'capacity development environment'. Rather thanproviding capacity building activities directly toLGUs, the Facility is designed to strengthen orestablish mechanisms and systems that willimprove the delivery and sustainability of CDefforts provided by a variety of actors.

The LOGIC Facility views the CD environment forlocal government as including 'enablers' who steerand support CD providers and beneficiaries (nation-al government agencies and local governmentleagues); 'providers' who develop and deliver pro-

grammes and technical assistance in support of CD(academic institutions, NGOs, donor assisted projects); 'direct partners' who manage, apply andutilise the capacities being developed and providefeedback to the providers and enablers (LGUs); and'indirect partners' who express their needs and pri-orities for governance change (civil society, people'sorganisations, citizens). The Facility is attempting toenhance the enabling environment for CD by work-ing with all of these actors to: provide a clear andcommon local governance CD agenda; institution-alise an LGU performance and capacity tracking system; enact policies supportive of CD; develop apool of resource persons and institutions to providehigh-quality CD interventions; establish mecha-nisms that facilitate continuous learning and man-agement of knowledge gained from good practicesin local governance; and encourage avenues formore active participation of citizens in local governance.

To implement LOGIC, DILG has invited stakeholders,including leagues, NGOs, academic institutions anddonors to become involved in a variety of ways,including through funding, research, joint projects,sharing of resources and provision of technicalassistance. LGSP has supported DILG both in theoverall conceptualisation of LOGIC as a mechanismfor sector-wide coordination and strategic govern-ment leadership to orchestrate sector development,and by providing technical assistance to specificLOGIC components. LGSP also ensures that its CDactivities are consistent with the LOGIC framework.

The LOGIC framework has given senior DILG officialsa 'tool' to help themselves and others develop a com-mon conceptualisation and approach to LGU capacitydevelopment (see box 1). The framework has allowedthem to demonstrate their understanding of theissues and to take a more strategic leadership role instrengthening the sector, especially in dialogue withdonors.

The communities themselves are also critical stake-holders within the system. Over time, observers havenoticed a shift in the attitude of some LGU personnelin terms of their responsibility to their community.More LGU officials are concerned about what govern-ment 'should be' and make efforts to understand theneeds and opinions of citizens.

Box 1: A capacity development strategy assystem self-awareness and empowerment:The DILG experience in the Philippines

The Department of the Interior and LocalGovernment (DILG) launched the LocalGovernance Institutional CapacityDevelopment (LOGIC) Facility in 2003. Theexercise of developing a 'framework' or 'sys-tem map' for local government development encouraged a senseof self-awareness within the local govern-ment system. It has also engaged key stake-holders such as national government agen-cies, NGOs, donors, academic institutions, civilsociety movements, and private suppliers.

To encourage this self-awareness and in turn,self-organisation, the LOGIC Facility attempt-ed to provide a common capacity agenda forthe system; to improve access to informationthrough a monitoring and evaluation system;and to encourage learning and the exchangeof experiences. Finally, it tried to facilitate theconnections and relationships amongst sys-tem participants. Empowered with increasedself-awareness and a tool for explaining thecomplexity of the system, DILG officials beganto take a more active role in promotingstrategic cohesion at the national govern-ment level and in coordinating external inter-ventions.


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One mayor commented that he and his staff nowtake more responsibility for the services that they aremandated to deliver. They hold consultations withcitizens and try to address their concerns. He addedthat community participation is the only way to getacceptance of government programmes: 'Withoutcommunity support you won't be assured of success.… Before, people were not part of the planningprocess, pro-jects were identified and prioritised bythe municipal planning coordinator, there was nocommunity participation and programmes were atthe discretion of the mayor. We saw complete failurebecause they were not responsive to the communityneeds.'

As stated earlier, the Local Government Code had aprofound effect on the evolution of and demand forCD. The executive director of DILG's LocalGovernment Academy has noted a gradual shift inhow national government agencies relate to LGUs -they have become more facilitative and enablingrather than regulatory. Many agencies are stilluneasy with devolution, however, and national poli-cy does not always keep pace with innovation atthe local level, resulting in a policy bottleneck with-in the system. For example, some cities and munici-palities are experimenting with alternative servicedelivery modalities such as joint ownership of utili-ties and public service enterprises with the privatesector, but the national policy on such ventures isvague, making many LGUs hesitant to try suchinnovative alternatives. Other national policies,such as the recent Solid Waste Management Act,which was implemented without adequate consul-tation with LGUs, are unrealistic and cannot beimplemented, leading to frustration and break-downs in relationships between national govern-ment agencies and LGUs. Several of the new nation-al laws contradict each other or the LocalGovernment Code, and there is a need for omnibuslegislation and a review of the code.

Such policy issues have an impact on CD in twoways. First, it is difficult for LGUs to enhance theircapacity to meet the requirements of legislationwhen the legislation is contradictory, unrealistic oracts as a barrier to their mandate. Second, LGUs areput into a position, collectively, of needing toenhance their capacity to engage in the policyreform process so that they can advocate effectivelyfor policy change.


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Within the LGSP and LOGIC frameworks, LGU capaci-ties are considered in relation to the people (e.g.elected officials, professional, technical and adminis-trative staff), the organisation (e.g. department andstaffing structure, information systems), the institu-tion (e.g. policies, mechanisms for public dialogue)and social interactions (e.g. political parties, mayor-staff relations). Each local government is seen tooperate within an enabling environment: a commu-nity of citizens, taxpayers, businesses, industry andcommunity groups; provincial, regional and nationaloversight offices; a municipal association and otherlocal governments; educational institutions with pro-grammes in local governance or public administra-tion; and a local cultural, ecological, economic andhistorical context. This enabling environment pro-vides both the policy and regulatory frameworkwithin which the local government must operate,and the supporting organisations and institutionsthat can facilitate the local government's work anddevelopment. CD can be supported within each ele-ment of this complex system.

This broader concept of CD has been used in exam-ining the internal organisational features thatinfluence an LGU's approach to CD and its benefitfrom CD. LGSP staff found that there were signifi-cant variations in the response of LGUs to theexternal CD support offered by LGSP and other pro-grammes. Some LGUs actively sought externalassistance to address perceived capacity gaps, tookadvantage of available CD opportunities, participat-ed eagerly in CD activities and benefited from CDas measured by capacity self-assessments and per-formance indicators. Others did not initiate orrespond to CD activities or opportunities. LGSPassessments and analysis found that the evolutionof capacity within LGUs was influenced by the rela-tionship between certain internal conditions andfactors, and the characteristics of the externalassistance available. CD occurred most successfullyin LGUs where internal conditions and factorsincluded 'readiness' for or 'receptivity' to theprocess. External assistance was most effectivewhen it supported LGUs over time, was welldesigned in response to the LGU's needs, usedappropriate CD methodologies, and was integratedwithin the LGU's existing network and enablingenvironment. These characteristics of externalassistance are described in section 7.

4 Internal organisationalfeatures and resources

There are wide variations in the levels of capacityand performance among Philippine LGUs and vastdifferences in their approaches to, and understand-ing of, capacity development. Some LGUs haveundertaken CD efforts on their own, or have takenadvantage of the CD support offered by nationalgovernment agencies and educational institutions.Others have been convinced to participate in CDprojects or programmes, and some have done littleor nothing to increase their capacity or improvetheir performance - not even acknowledging theneed.

Within the local governance system in thePhilippines, CD has traditionally been perceived asequivalent to 'training' or human resource develop-ment (HRD) and has not been linked to performance.Many agencies and institutions within the enablingenvironment have strived to expand stakeholders'understanding of CD to include organisational devel-opment (OD) as well as HRD. This expanded view ofCD is widely held among professionals within educa-tional institutions and senior government officialswith DILG and within larger cities and municipalities.However, in smaller municipalities, CD is still fre-quently equated with training activities and formaleducation.

The conceptual framework for CD used by LGSP andLOGIC is an 'open systems' model that encompassesbut is broader than HRD and OD. It considers CD asa complex process at various 'levels' within a sys-tem, for example at the local or micro level; at theprovincial and regional or meso level; and at thesector, system, and national or macro level. It alsoconsiders the interconnections and linkagesbetween the levels and among the stakeholders. Ateach level the surrounding level is perceived as an'enabling environment' that can either 'enable' or'disable' the individuals and organisations within it.Within this framework, capacity is an input to, orleads to, performance, and LGU performance is aninput to, or leads to, local social and economicdevelopment.


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Leadership within cities and municipalities is prima-rily provided by local chief executives, i.e. the mayors.LGSP found that the attitude and approach of themayor was the single most important factor in deter-mining an LGU's 'readiness and receptivity' to CD.Mayors in the Philippines are extremely influential,and frequently come from historically powerful polit-ical families. The terms of office of senior administra-tive staff within LGUs are co-terminus with that f themayor, and they are heavily influenced by themayor's position on issues affecting the municipality.Therefore, mayors who were interested in, and sup-ported, CD caused others to take note of it. Mayorsthat demonstrated a developmental orientation andwere open to innovation and change were muchmore likely to be interested in, and supportive of, CDthan mayors concerned with political power andmaintaining the status quo. Mayors who were wellconnected within a network of other governmentleaders, including other mayors and leaders fromother levels of government, were also more likely tobe interested in, and supportive of CD, as they triedto learn from, and replicate successful practices thatthey learned about from others.

Other local leaders who were able to influence anLGU's response to CD opportunities, although to alesser extent than mayors, were vice-mayors, localgovernment operations officers (DILG-appointedstaff) and local planning and development coordina-tors. When these officials had good planning, man-agement and human relations skills, CD activitieswere more likely to be supported and to lead to benefits in terms of HRD, OD and improved LGU performance.

Another influencing factor within an LGU was thequality of teamwork. In the Philippines, the mayorheads the executive and the vice-mayor chairs theelected council. In LGUs where the mayor and vice-mayor have a good working relationship there wasmuch more overall support for CD. This happenedmostly in LGUs where the mayor and vice-mayorwere from the same political party, but was also evi-dent in some municipalities where the mayor andvice-mayor were from opposing parties but hadforged a relationship that allowed them to worktogether toward common goals and where themayor made concerted effort to work collaborativelywith the council and the captains from constituentbarangays. Teamwork among LGU department heads,interdepartmental cooperation and a concerted

Within an LGU, a variety of organisational featureswere identified as 'indicators' of how ready it was todevelop its own capacity and how receptive it was toexternal assistance to enhance its capacity andimprove its performance. These 'readiness and recep-tivity conditions or criteria' were related to leader-ship, teamwork, community participation and peaceand order (see box 2).

Box 2: Readiness and receptivity for capacity development within local government units

LGSP phase II worked with over 200 local govern-ment units in seven regions in the southernPhilippines during the period 1999 to the present.Over time some local governments showed signifi-cant improvements in capacity and performancewhile others did not. Through observation andanalysis LGSP staff were able to identify a set ofconditions that were relatively reliable 'predictors'of success in facilitating development and changewithin the LGU. They developed a basic 'checklist'of conditions that indicated a rough sense of thereadiness or absorptive capability of a local government for capacity development. This listwas useful for assessing new LGUs joining LGSP,and was later used by Agriteam for assessing newLGUs in another CIDA project, the LocalGovernance Support Program in the AutonomousRegion in Muslim Mindanao (LGSPA). These condi-tions included• the level of interest and awareness of the mayor

in local social and economic development;• the level of internal teamwork between the

mayor, the elected council and staff;• the level of community involvement and partici-

pation in LGU affairs;• the level of interconnections between the LGU

and other LGUs involved in development andreform;

• the state of the security situation in the LGU;and

• the perception of LGU of the relevance of theexternal assistance offered.

About 20% of participating LGUs were rated ashaving a 'low' overall readiness. These LGUsrequired a very particular approach to supportingtheir capacity development that started withaddressing these 'readiness' conditions.


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effort by the mayor to involve department heads andother staff in planning and decision making werealso evident in the LGUs that were actively involvedin CD. Again, the attitude and approach of the mayorin his/her willingness to share decision-makingpower and to consult with staff and colleagues werecritical factors in the development of trusting andcollaborative working relationships among staff.Trust and collaboration proved to be conducive toorganisational development.

An LGU's motivation to undertake CD also seemed tobe influenced by the level of community participa-tion and consultation. LGUs that communicated frequently with constituents and invited the involve-ment of community groups, NGOs and the privatesector in government decision making and servicedelivery seemed more interested in CD as a means tobetter fulfil their mandate and meet the needs of citizens. These LGUs had a relationship that wasmore cooperative than confrontational with civilsociety and business organisations. LGU officials thatconsulted with citizens became more aware of theirneeds and more committed to improving servicedelivery to meet those needs. They became interest-ed in developing their own capacities, learning newskills, acquiring new technologies and adopting better systems so that they could contribute more toprogrammes that would benefit citizens.

Lastly, the peace and order situation in LGUs influ-enced their participation in CD activities. LGUs in astate of crisis due to armed conflict, large numbers ofdisplaced people, and natural and man-made disasterswere not in a position to participate meaningfully insustainable CD initiatives. In parts of Mindanao, forexample, armed conflict between Islamic separatistgroups and the armed forces of the Philippines hascontinued sporadically for three decades. In theseareas, LGUs' performance in delivering basic services isgenerally poorer than in the rest of the country, andtheir interest in CD is low. Local officials in these areasare frequently too overwhelmed with post-conflictchallenges to think about capacity development, andlack of security and military rule makes normal government functioning and cooperative government- community interaction almost impossible.

In LGUs where these four organisational features(leadership, teamwork, community involvement andpeace and order) were positive, external CD opportu-nities offered by the LGSP and other programmes

were maximised by the LGUs. For example, MayorDavin of Magsaysay showed leadership in his firstterm of office and recognised the need to build thecapacity of his LGU on two fronts - HRD for LGU staffand relationship building between the LGU and thecommunity. He searched for local organisations toassist him in building these capacities but was onlyable to solicit support from DILG. According to themayor, DILG's support was helpful but too generaland not focused on his LGU's specific needs. The LGUdid not have the resources to hire external consult-ants to provide technical assistance tailored to thelocal situation.

During his second term, Mayor Davin eagerly tookadvantage of the opportunity to participate in LGSP.He found LGSP CD initiatives to be high in technicalquality, tailored to his LGU's needs, and helpful inempowering local people to become involved in government activities. The support that LGSP provid-ed to the LGU in developing an 'executive agenda'that outlined the development priorities of the com-munity over the three-year term of office helped tostrengthen the existing teamwork and shared goalswithin the LGU and increased the level of communityparticipation in governance. Magsaysay participatedin LGSP-supported CD projects related to food securi-ty, financial management, management informationsystems, barangay governance, community participa-tion, public economic enterprise management andagricultural extension. The LGU also undertook CDinitiatives on its own related to the environment andsolid waste management. The LGU has since wonseveral national awards and its programme to bringgovernment services closer to citizens in isolatedbarangays has been selected as an exemplary prac-tice for replication in other LGUs.

LGUs that have been assisted by LGSP are more likelythan non-assisted LGUs to identify the link betweenCD, improved LGU performance and better servicedelivery to the community. LGSP-assisted LGUs arealso more likely to allocate LGU resources to CD, ODand HRD activities than non-assisted LGUs. Themajority of non-assisted LGUs do not have formalstaff development or HRD plans or CD plans.

Many newly elected mayors and vice-mayors havelittle experience with government, management orCD. Although they receive an orientation sessionfrom DILG's Local Government Academy, it is notenough to provide them with all of the knowledge


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and skills that they need to manage the operationsor the CD of their LGU, including their own profes-sional development. Mayors that have an advantageare those that have a business or management back-ground. These mayors bring with them a results-based approach that includes an interest in perform-ance and capacity improvement.

The executive director of the Local GovernmentAcademy noted the emergence of a new crop of localgovernment leaders in recent years. She frequentlyfinds them to be younger, more development orient-ed, more open to new ideas and more genuinelyinterested in effecting change in their municipalitiesthan the traditional leaders who were interested inpatronage politics and kept all decision making tothemselves. She attributes these positive changes tothe evolution of leadership within communities andLGUs through the investments of years of trainingand capacity building efforts of the national govern-ment and donor agencies, the higher educationalbackground of the new leaders and their broaderexposure to outside systems and other ways of doingthings. Newly elected mayors that have an opportu-nity early in their term of office to receive additionaltraining and to interact with successful second andthird-term mayors and mayors with a developmentorientation and business approach to governmentmanagement are more likely to take an interest in,and be supportive of, CD than newly elected mayorswho struggle in isolation in their early months.

Investments in local government leadership over thepast few years have come from a variety of donor-funded programmes, including the long-termCanadian investment through LGSP, the USAID-fund-ed GOLD and GEM projects, Asia Foundation pro-grammes for good governance, the UNDP andAusAid facilities for local governance strengthening,and Asian Development Bank investments in localgovernment. Training for local leaders as well asresearch in local governance have been provided bythe schools of public administration and governanceat the major Philippine universities. The AsianInstitute of Management (AIM) in Manila providesleadership and good governance courses for electedlocal officials, and the Centre for Local and RegionalGovernance (CLRG) at the University of thePhilippines in Quezon City provides academic leader-ship and conducts research related to local govern-ment and decentralisation. DILG relies on donor-assisted programmes and the academic institutions

when developing its own programmes and strategiesfor local government capacity building.

LGSP found that the enhancement of capacity wasslower in LGUs where some or all of the four readi-ness conditions (leadership, teamwork, communityinvolvement and security) were weak or absent. SuchLGUs needed different types of CD interventions inorder to help them prepare for intensive and compre-hensive capacity building activities. The importanceof gearing the external support to the existing inter-nal conditions was emphasised by LGSP personnel.The approach recommended that external agentsadopt the following strategies to develop 'readiness':

• Invest in the development of the mayor. Help themayor gain an appreciation of the developmentchallenges facing the LGU and inspire him or herto address them. This may be done through studytours to excellent LGUs with 'model' mayors;tapping development-oriented peers of the mayorwho can influence and encourage him/her; expos-ing the mayor to examples of LGUs that haveimproved their performance through focused CD;and helping the mayor to see that 'good gover-nance' is 'good politics'.

• Include comprehensive team-building activitiesduring the consensus-building stage. Plan activi-ties that will bring the mayor, the council and theLGU staff together for activities that are produc-tive, enjoyable and that build working relation-ships among them. Be prepared to provide andmodel conflict resolution facilitation if necessary.

• Focus first initiatives around the interest of themayor to gain his/her support. Develop rapportwith the mayor and other staff and slowly intro-duce and advocate for capacity and performanceimprovements in good governance, cross-cuttingthemes, etc., as the relationships and trust develop.

• Work with civil society and the communitytowards positive interaction and cooperation withthe LGU. Help build CSO capacity for dialogue andconstructive advocacy so that the 'demand' sideleads to LGU improvement rather than alienation.Encourage the CSOs to work with the LGU andsupport small joint undertakings. Tap traditionalleaders to get involved in governance and workwith NGOs to educate the citizenry about theirrole in governance.

• Ensure that early interventions lead to quick,observable benefits and 'small victories' so thatthe mayor and LGU officials experience success


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and are motivated to participate in and supportfurther CD activities. Local officials in thePhilippines only have a three-year term of office.During this time they are scrutinised carefullyand criticised harshly by their opponents. Oneelection campaign seems to run into the next.Politicians investing in something new, such ascapacity development, will need to demonstratethe benefits quickly in order to win and keep thesupport of staff, counsellors and citizens. If com-puter training and new computer software leadsimmediately to faster and more transparent pro-cessing of business licences and building permits,citizens are happy. If the same exercise also leadsto increased licence and permit revenue for themunicipality, LGU officials are happy. Such quick,observable benefits can make it easier to gainsupport for more complex organisationalchanges.

5 CapacitiesAs capacity development is often regarded as beingequivalent to training or HRD, capacities are frequent-ly perceived to be the skills, knowledge and attitudesof personnel and elected officials. In the Philippines,as elsewhere, there is little understanding of thenotion of 'organisational capacities' or 'system capaci-ties'. There is little consensus within the local gover-nance sector about what organisational capacities arenecessary or desirable in order for LGUs to performtheir functions well or about how to measure the linkbetween LGU capacity and performance. There is evenless appreciation of the concept of system capacities,other than among some donor groups. However, LGSPattempted to identify and assess the components ofthe local governance system in order to plan andimplement activities to strengthen system capacityand enhance the enabling environment for local governance. LGSP's efforts to develop system capaci-ties are described in section 7.2.

Based on an analysis of the phase I of LGSP (1991-1998), during which more than 300 LGUs were assist-ed to develop their capacity, LGSP phase II staff identified four areas or clusters of capacities thatappeared to be critical for improving LGU perform-ance. These were: local government leadership and

management; service delivery; resource generationand management; and participatory governance. Ineach of these areas personnel and organisationalcapacities were identified and indicators selected tomeasure the level of capacity within each LGU.Performance indicators were also selected in eacharea to try to measure the impacts of increasingcapacity on LGU performance.

LGU personnel capacities that were assessed andstrengthened through LGSP activities includedknowledge and skills in each of the four performanceareas, for example knowledge and skills in manage-ment, planning, revenue collection and communityconsultation. Knowledge and skills related to cross-cutting themes such as gender equality, environmen-tal sustainability and promoting community harmo-ny were also assessed and measured.

LGU organisational capacities that were assessed andstrengthened through LGSP included the plans, locallegislation, systems, procedures, processes, structuresand technologies required by the LGU to functioneffectively in each performance area, for exampleland use plans, fisheries ordinances, computerisedaccounting systems, transparent permit procedures,community advisory committees and proceduresmanuals. The application or implementation of per-sonnel and organisational capacities in each areawas supported and assessed through the measure-ment of LGU performance. Performance measures ineach area included quality of plans,systems and structures, the level of effectiveness, e.g.the amount of revenue collected, number of pro-grammes offered, percentage of households reached,level of citizen involvement, as well as the level of citizen satisfaction.

To measure changes in the capacities and perform-ance of each partner LGU, LGSP developed a per-formance information system (PIS) consisting of 49indicators, each with criteria or elements to helpmeasure the indicator and give it a numeric value.The PIS was computerised and data about each ofthe 49 indicators entered twice per year from 2000to 2005. This allowed the programme and its part-ners to track the progress of each LGU in developingits capacities in each performance area as well as theprogress of the programme itself (by combining theprogress of all 205 LGUs). The information about eachLGU's capacity and progress was used by the LGUsand the LGSP staff to plan further capacity develop-


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ment initiatives. The information was also sharedwith DILG so that they could also plan appropriatecapacity development assistance for the LGSP-assist-ed LGUs and for other LGUs in the country.

DILG, through LOGIC and the Bureau of LocalGovernment Supervision, has invested considerableresources in identifying the LGU organisationalcapacities that need to be in place in order for anLGU to perform well, and in developing a system tomeasure the LGU 'inputs', the resulting 'outputs' orperformance, and, ultimately the long-term 'out-comes' or development impact of improved local

government performance. To this end, DILG devel-oped the Local Productivity and PerformanceMeasurement System in 1999 and revised it in 2003,with LGSP and ADB assistance, to become the LocalGovernment Performance Measurement System(LGPMS). LGPMS includes five performance areas inwhich LGU inputs and outputs are measured: gover-nance, administration, social services, economicdevelopment, and environmental management. Theinputs in each service area describe the 'organisa-tional capacity' that should be in place if the LGU isto be able to deliver the 'outputs' or governmentfunctions and services.

Performance Area 1 : GovernanceService area Input or organisational capacity Indicators1.1 Local legislation Effective legislative mechanisms, • effective legislative agenda

systems and procedures • effectiveness of legislative tracking system1.2 Transparency Effective systems and mechanisms • presence of performance billboard

for making information available to • presence of public information office orcitizens desk

1.3 Participation Effective consultation mechanisms • presence of CSO desk or other mechanism and systems for constituent to support the development of local NGOsparticipation and POs

• effective process to conduct independentsurveys of citizen satisfaction

• Quality of gender and development planPerformance Area 2: Administration2.1 Development Effective structures, consultative • effectiveness of local development council

planning mechanism, and tools to support •adequacy of database to support local development and land-use planning development planning

2.2 Revenue Viable plans, tools and systems for • presence of comprehensive revenuegeneration increasing LGU revenues generation plan

• efficiency of system for real property tax assessment and collection

2.3 Resource allocation Viable plans, tools and systems for • presence of executive budget approvedand utilisation budgeting within the budget calendar

• percentage of departments maintaining a record of appropriations and expenditures

2.4 Financial Effective guidelines, systems, and • quality of internal control systemaccountability structures for accounting, internal • effectiveness of financial management

control and procurement system• effectiveness of bids and awards

committee2.5 Customer service Customer-oriented administrative • effectiveness of customer service

systems • streamlined civil application systems2.6 Human resource Effective structures, systems and • effectiveness of HRMD

management and programmes for managing and • quality of HR policies, plans and supportdevelopment developing human resources materials

• effectiveness of HR selection, appraisal and promotion system


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Performance Area 3: Social Services3.1 Health and Appropriate structures, human • effectiveness of local health board

nutrition resources and facilities to provide • percentage of barangays with functioning health and nutrition services barangay health centres

• ratio of public health workers to population3.2 Education Appropriate structures, human • effectiveness of local school board

resources and facilities to provide • percentage of barangays with functioning education services daycare and preschool centres

• ratio of elementary school teachers to pupils

• ratio of elementary school classrooms to pupils

• Quality of non-formal and extension programmes

3.3 Housing Effective structures and programmes • Effectiveness of local housing board andto provide socialised housing and housing task force or coordinating unitbasic utilities • Quality of socialised housing program

3.4 Peace, security and Effective structures and plans for • Effectiveness of local disaster coordinatingdisaster peace and order, fire prevention and councilpreparedness disaster preparedness services • effectiveness of local peace and order council

• effectiveness of women's and children's desk

• quality of integrated area community public safety plan

Performance Area 4: Economic Development4.1 Agriculture and Relevant policies, strategies, • Presence of development activities to

fisheries programmes, facilities and resources support improvement in faming and fishingdevelopment to support improvements in farming practices

and fishing practices • quality of research and developmentfacilities to support farmers and fisher folk to test and adopt new products, practices and technologies

• Quality of LGU support for farmers and fisher folk

4.2 Enterprise, business Effective policies, structures and • Effectiveness of small and medium and industry resources to promote private sector enterprise development councilpromotion investment • Presence of basic infrastructure and utilities

in areas zoned for business and industry• Quality of local investment incentives

Performance Area 5: Environmental Management5.1 Natural resources Effective policies and programmes to • Quality of environmental legislation

management protect, conserve and rehabilitate • percentage of barangays reached by IEC natural resources conservation campaigns

• conservation and rehabilitation of mangroves

5.2 Waste management Effective structures and programmes • Effectiveness of solid waste managementand pollution to manage waste and pollution boardcontrol • percentage of solid waste collected that is

properly disposed of.


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The first two areas, governance and administration,can be considered 'core' or 'generic' capacities as theydescribe 'how' local governments work. The otherthree areas can be considered 'specific' or 'technical'capacities as they describe 'what' the local govern-ment does.

Although primarily a performance measurementsystem, LGPMS illustrates how system leaders in thePhilippines conceptualise and categorise LGU organi-sational capacities. The LGPMS organisational capaci-ties, or 'inputs' for each performance area, along withcorresponding indicators are presented in table 1.

Each service area also has outputs and output indica-tors, as do the final three performance areas. The out-come indicators attempt to measure the impact of theLGU programmes and services on overall social andeconomic development in the municipality or city bymeasuring such things as crop yield or fish catch, per-centage of malnourished children and infant mortalityrate, percentage of households with potable watersupply, and secondary school graduation rates.

The LGPMS is primarily a tool for LGU self-assess-ment. It forms part of an LGU management informa-tion system that provides data to LGU managers sothat they can make better decisions. LGSP staff foundthat by providing LGUs with a self-assessment tool(the LGSP PIS, which was similar to LGPMS), LGUsbecame empowered to identify their own strengthsand weaknesses, and to gather the information theyneed to plan ways to move forward, including areasin which they needed to develop their capacity.

LGSP staff initially found that LGUs had only a vaguesense of their capacity building needs. Throughoutthe life of the programme, however, this changed.Staff found a significant difference between LGSP-assisted and non-assisted LGUs in terms of theircapacity assessments. LGSP-assisted LGUs were muchmore likely to identify capacities they wanted tostrengthen that cut across all government functionsand services such as 'participatory planning' and'community involvement', whereas non-assistedLGUs were more likely to identify capacities relatedto specific sectors such as health or livelihood assis-tance. This difference seemed to arise as LGSP-assist-ed LGUs discovered that skills learned and strategiesused in one area could readily be applied or gener-alised to another.

6 Endogenous organisational change and adaptation

As stated earlier, organisational change is usually afunction of internal and external factors. The rateand scope of change within an LGU are functions ofthe social, political and economic context; pressuresand support from within the enabling environment;and various internal organisational features. Overall,however, the process of change seems to be similar.LGSP staff found it useful to describe LGU organisa-tional change and adaptation as a dynamic four-stage developmental process.

Organisational change within LGUs is viewed broadlyas a CD process that takes place over time, each stepor stage building on the one before, and the stepsrepeating themselves in a cyclical, upwardly spirallingmanner in response to internal and external influ-ences. Cycles in different parts of the organisationoccur simultaneously and go through the process atdifferent rates. Results, or milestones, can be identifiedwith each stage of this developmental process:

• Consensus: increased agreement among LGUstakeholders about the need to enhance capacityin order to improve governance and/or perform-ance; and about what capacities and whosecapacities to develop.

• Strengthening capacities: strengthened individualand organisational capacities - personnel compe-tencies and organisational processes, structuresand systems.

• Application: improved application of strength-ened capacities; improved implementation ofprocesses, structures, and systems to improve per-formance.

• Institutionalisation: regulatory support for newsystems; culture of continuous improvementinternalised; increased ability of the enablingenvironment to support and sustain CD.

LGSP analysis found that CD efforts that did not fol-low the four stages did not result in sustained organ-isational change or adaptation. LGU and DILG offi-cials and other local governance experts cited manyexamples of 'one-off' training activities and uncoor-


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This process was directly linked to the developmentand implementation of an executive agenda (EA) ineach LGU that identified the development prioritiesfor the LGU during the three-year term of office ofelected officials. LGSP assisted each LGU to developits EA in a participatory way involving staff and com-munity stakeholders not only to ensure communityconsensus about LGU priorities, but to encourageLGUs to 'own' their municipal development plans aswell as their CD plans. Each LGU's plan for CD wasprepared to guide the enhancement of skills, sys-tems, policies, plans and mechanisms most neededto carry out its mandate and fulfil its three-year EA.

Regardless of the scope of a CD initiative or activity,without early consensus among stakeholders aboutthe why, what, who and how of CD, there is littlehope that it will have the support, or meet the needs,of the organisation.

6.2 Stage 2: strengthening capacities The second stage was to put the CD plan(s) intoaction by carrying out capacity strengthening activi-ties such as human resource development, skills train-ing, introduction of new systems and technologies,and improvements in policies and procedures. In LGSP,CD activities strengthened the administrative capaci-ty of LGUs as well as the competencies required tofunction as effective governing bodies, public entre-preneurs, managers of change, and advocates forpeace, gender equality, social equity and sustainabledevelopment. A key component of stage 2 washuman resource development to enhance the skills ofelected officials and LGU staff in order to ensure theavailability of appropriate and sustainable leadership,managerial, technical and professional expertisewithin LGUs. Local service providers were frequentlyengaged to provide technical expertise and to coordi-nate CD activities. Much of the technical expertisewas provided through technical exchanges and peercoaching from colleagues in other cities and munici-palities in the Philippines and in Canada.

Another important element of stage 2 involved thestrengthening of participatory mechanisms such aslocal development councils, health boards, educationboards, and peace and order councils. LGSP activitieswere implemented to strengthen community-basedstructures and people's organisations, and toimprove communication and linkages between thesemechanisms and government officials.

dinated and externally driven CD initiatives that didnot result in any significant or sustainable change inthe way LGUs functioned or operated. Researchersheard numerous stories of new skills, new plans andnew technologies that were acquired but never putto use within the LGUs.

The LGSP implementation strategy emphasised theimportance of facilitating and coaching participatingLGUs through the CD stages to ensure that CD initia-tives would lead to sustainable change. Assistancewas provided on an 'as-needed' basis. Only LGUs thatrequested assistance from LGSP and indicated theirwillingness to participate actively in their own devel-opment process were provided with direct technicalassistance. LGSP felt that it was important that par-ticipation be voluntary as a precondition for Stage 1 -consensus about the need for change began with theLGU coming forward. It also was in keeping with theLGSP concept of capacity development that includesempowering LGUs to manage their own develop-ment, so respect for LGUs' own decisions was prac-tised from the beginning of the programme.

6.1 Stage 1: consensus The first step in the process is for LGUs to assesstheir CD and institutional strengthening needs andto come to consensus on organisational develop-ment priorities and a plan for change. This may be acomprehensive plan for the whole LGU or a smallplan for a department or unit. For LGSP, this key stageincluded an assessment and analysis using an infor-mal 'appreciative inquiry' approach that providedbaseline data on the performance and existingcapacity of the LGU (both strengths and weakness-es), and provided the information on which furtherCD interventions were planned. The appreciativeinquiry approach was introduced informally bycoaching the LGSP staff to ensure that assessmentsfocused on what LGUs were doing well, not just onwhat was 'wrong' so that officials did not becomediscouraged, or 'lose face' in front of their peers andstaff, when confronted with the many weaknesses oftheir organisation. Rather, LGSP staff members werecoached to help LGUs believe that if some thingswere going well, then the LGU had the untappedcapability to do other things well. The extent towhich the appreciative inquiry approach was actuallyused varied among staff members.

An important element of this stage is choosingappropriate CD methodologies. Many capacity-strengthening activities fail because they rely on traditional training methods instead of appropriateadult learning methodologies, or plan training ses-sions even when the capacity gap is related to organ-isational structures and not personnel competencies.

6.3 Stage 3: application The third stage of the CD process is the applicationof new skills and systems to local government workso that staff, elected officials and LGUs can achievetheir change objectives. LGSP assisted LGUs to usetheir new or enhanced skills, systems and proceduresto implement new development programmes and toimprove the delivery of services. Pilot and demon-stration projects were supported in many LGUs inorder to develop models of effective local governancethat could be replicated from barangay to barangayand in other LGUs throughout the Philippines.

LGSP programme officers played a critical role duringstage 3 by providing on-site mentoring to LGUs andother partners to help them apply new capacities,implement new plans and programmes, and monitorand evaluate progress. LGSP developed manuals andtools to support the systematic documentation,dissemination and replication of exemplary practicesin local governance and collaborated with DILG andthe leagues of cities and municipalities to implementa pilot national replication programme.

In order for CD to be applied and institutionalised,there must be linkages between individual andorganisational capacities. For example, it is vital to beaware of how individual personnel capacity buildingis supported by organisational and institutional com-mitment. Many CD initiatives do not result in organi-sational change and adaptation because they do noprovide support beyond stage 2. In many cases, train-ing, study tours, planning sessions and new tech-nologies are provided without any follow-up supportto ensure that they can be applied on-the-job, ormodified and further strengthened or adjusted asnecessary. Frequently personnel and organisationsneed assistance to lobby senior officials or oversightagencies for authorisation or resources to use newcapacities to bring about change.


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6.4 Stage 4: institutionalisation The final stage in the process is to institutionalise newprocesses and to internalise the process of CD itself. AsLGSP draws to a conclusion it anticipates that manyLGUs will have created an endogenous culture of continuous improvement and will have systems inplace to elicit client feedback and to respond to theneed for their own further development. LGSP staffsupported LGUs to internalise institutional improve-ments through local ordinances or other formalisationprocedures, and to establish participatory mechanismsfor continuous assessment and improvement.

As part of the programme's sustainability strategy,LGSP staff helped each participating LGU host a'recognition conference' that presented a report onthe improvements in the LGU's capacity and per-formance over the life of the programme andacknowledged individual and LGU accomplishments.The conferences have been successful in helping toinstitutionalise changes and motivate newly electedand re-elected officials to continue to strive toimprove government functioning and to develop thecapacity they need in order to do so. They lead toconsensus about next steps to continue progress,allowing the cyclical process to start again, with eachcycle of capacity development experience ideallyleading to increasing levels of capacity and perform-ance. One LGSP study found that the communityplayed a key role in institutionalisation. As citizensand community groups became accustomed todecent levels of LGU service and to certain opportu-nities for civic participation, they began to expect,and demand, more. Thus they contributed to thecapacity development spiral - citizen demand, con-sultation and assessment, consensus building, plan-ning for change, capacity development, performanceimprovement, citizen benefit, citizen demand ... .

It is often difficult to measure whether or not CD ini-tiatives have resulted in sustainable organisationalchange and adaptation because it takes a long timefor LGUs to reach this final stage. Few externalagents supporting CD, whether donors, national government agencies or academic institutions,assess or evaluate the effectiveness of their interven-tions over long time frames. For example, it may takeseveral years to observe whether or not an LGU isable to adapt a new system on its own in response tochanging circumstances within the community.


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LGSP uses the following diagram (figure 2) to illustrateits programming framework. The programme supportsthe CD process through all four stages in each of thefour capacity areas. It also integrates four cross-cuttingthemes and involves the enabling environment at eachstage and in each capacity area. The circling arrowdenotes the repetitive, cyclical, or spiralling nature ofthe process. The process, in reality, is not smooth, nor isit frequently visible to outsiders without keen observa-tion. Different departments and projects within an LGU

will be at different stages of the cycle simultaneously.For example, consensus on the need to improve proper-ty tax collection may not have been reached when newskills and technologies for solid waste managementare already being implemented.

LGSP found the framework most helpful when train-ing its own staff and other external capacity develop-ment facilitators. It did not become a 'template' thatforced a standard capacity development strategy or

Figure 2. LGSP capacity development (4x4x4) framework

OUTCOMESEffective Local Governance

Outputs

Outputs

INSTITUTIONALIZATION

APPLICATION

CAPACITY STRENGTHENING

CONSENSUS BUILDINGLocal Government Service Resource Participatory

Management Delivery Generation Governance

Local Government Service Resource ParticipatoryManagement Delivery Generation Governance



SupportingInstitutions

Private Sector

MunicipalLeagues

Civil SocietyOrganizations

National &Regional

Government PovertyReduction

Gender Equality

EnvironmentalProtection

Peace and Unity

ENABLING

ENVIRONMENT

CROSSCUTTING

PRINCIPLES

Outputs

OutputsStage 1:

Stage 2:

Stage 3:

Stage 4:

plan on every local government unit. Rather, it pro-vided a conceptual guide for LGSP staff that helpedthem keep the principles of sustainable capacitydevelopment in mind as they worked. It remindedthem that in every interaction with partners to startwith 'consensus building' to ensure that all the keyplayers agree on what is to be done and why, and toensure that local governments take ownership of thecapacity development process, believing the externalinterventions to be based on their needs and not thepriorities of the donor or other external agent. Theframework also reminds staff that providing newskills or systems is not going to result in change untilthey are applied, implemented and internalised, andthat effective external intervention will support part-ners to overcome barriers to application, implemen-tation and internalisation. The framework alsohelped staff to remember and to describe to othershow important cross-cutting issues such as genderequality needed to be considered at various steps inthe process. The framework became a tool for LGSPto help ensure that its role continued to be one ofaccompanying an LGU on its journey of endogenouschange, rather than leading or directing change fromoutside.

The framework, therefore, helped LGSP staff andpartners to design capacity development supportthat incorporated and respected the concepts high-lighted in the programme's approach by presentingthem in a one-page 'snapshot', informally referred toas the '4x4x4 framework'.

Researchers noted that LGSP-assisted LGUs realisedthe need for continuous learning within their LGU.They recognised that capacity building was an ongo-ing process in which the development of certaincapacities gives rise to the emergence of the need forfurther CD, and the four-stage cycle of capacitydevelopment repeats itself in an upwardly expandingspiral.

According to several mayors, LGUs were already tapping outside sources of assistance for capacitybuilding before joining LGSP. It was fairly common formayors that had identified the need to improve theway the LGU worked or delivered services to seekoutside assistance. The greatest constraint that theyfaced was limited financial resources to pay for theservices. In addition, many commented that they didnot know how to find appropriate external assis-tance. They were unaware of which donor agencies,

educational institutions and NGOs provided techni-cal assistance to LGUs, and did not know how toapproach them. They also noted that the assistancethey received often did not meet their needs.

LGSP was able to assist these mayors in a number ofways. The programme provided the LGUs with aresource kit listing potential service providers andresource partners, helped them to identify the mostcritical and strategic areas in which to focus CDefforts and to find appropriate service providers, andpaid for some of the initial technical assistance. Inmany cases, the relationships that were developedbetween the LGU and local agencies providing tech-nical assistance continued well beyond the assis-tance provided by LGSP, with the LGU picking up thecosts of the service provider when LGSP fundingended. Strengthening an LGU's 'network' and abilityto network was an important part of LGSP's capacitydevelopment strategy. Formal networking eventswere planned as part of the programme, and oppor-tunities for informal networking were consciouslybuilt into the design of others.

Some LGUs did find innovative ways to improve theirLGUs on their own. Some initiated internal activitiessuch as local contests and school programmes thatgot local people together to share their expertisewith each other and LGU personnel and to jointogether to implement improvement projects. It waswidely recognised that there was limited capacitywithin the enabling environment to document, dis-seminate and support replication of locally initiatedinnovative and exemplary practices with other LGUsin the country. LGSP addressed this by working withDILG, the League of Municipalities and the League ofCities of the Philippines to establish mechanisms andsimple systematic procedures for replication.

LGUs have also been successful in increasing theirown capacity to perform more effectively by enteringinto associations or alliances with other LGUs.Neighbouring LGUs that formed agreements to worktogether on issues of joint concern were able to pooltheir resources to address the issues. One suchalliance involved several LGUs establishing a coordi-nating unit to share equipment, funds and technicalpersonal for the maintenance of farm to marketroads. According to one mayor, the LGUs were able toidentify their respective strengths and weaknessesand find ways to complement each other. Collectivelythey became more effective at leveraging external


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resources to help fund the coordinating unit's activi-ties. This cooperative practice has been successfullyreplicated in several other LGU alliances followingthe LGSP replication methodology.

According to LGSP area managers, the impact of thesystematic replication methodology on LGUs' capaci-ty has been significant. When LGUs hear about howto make changes from another LGU, rather than froma training organisation, it is easier for them tobelieve and understand. When they visit the 'host' ordemonstration LGU and see the results of what hasbeen done with their own eyes, they are much morelikely to be able to plan and carry out similar changein their own LGU, especially if the host LGU providesfollow-up advice and support.

As stated earlier, LGSP found the mayor to be the keyfactor in organisational change. Mayors with a'development' perspective were much more likely toinitiate and support capacity development effortswithin their LGU. This support from the mayor, how-ever, did not grow out of an interest in capacitydevelopment per se, but rather from an interest in ora passion for change. In the Philippines, some localleaders have a vision of a brighter future, a desire forbetter health care, a wish for less poverty, or a yearn-ing for peace that motivates them to do a better job.These mayors believe that local governments canmake a difference in people's lives and set out tomake sure their LGU officials provide the best servic-es possible. When they realise that some officials,some services or some departments are not func-tioning or performing effectively they look for waysto improve. Frequently they see staff training as ameans to increase effectiveness, and then, whenexposed to a broader view of capacity developmentthat includes staff, organisational and institutionaldevelopment, become keen to develop and pursue acapacity development agenda.

Of course, not many mayors are motivated by purelyaltruistic goals. However they are encouraged byFilipino religious and political leaders who promote'righteous leadership' as a duty of good Christian andMuslim leaders. Many admit that they are learningthat 'good development equals good politics' - inother words, programmes that help citizens also helppoliticians get re-elected. LGSP found that in LGUswithout a development-oriented mayor, there waslittle interest in helping people, and hence littleinterest in doing a good job, resulting in little inter-

est in developing organisational capacity to dothings differently. External incentives, even financialones, would not entice a disinterested mayor toembark upon a sustained capacity development pro-gramme as 'old-style' patronage politics was suffi-ciently lucrative. The strategy suggested by LGSP forsuch mayors was to provide opportunities for themto interact as much as possible with development-oriented mayors and other leaders with the expecta-tion that some of them will learn to see their roleand responsibility differently.

7 External interventionMany LGUs have sought external assistance for CD,and others have been included in capacity buildingexercises imposed upon them by others. As discussedearlier, the effectiveness of the external interven-tions has depended upon the interaction of the char-acteristics and quality of the external interventionwith the characteristics and readiness of the LGU.LGSP is widely viewed as one of the most successfulprogrammes in providing external support to LGUs.

LGSP is the most extensive donor-assisted pro-gramme supporting CD for local governance in thePhilippines. It is a collaborative effort of CIDA, thePhilippines National Economic and DevelopmentAuthority (NEDA) and DILG. The programme has beenimplemented in two phases, phase I, from 1991 to1998, and phase II, beginning in 1999 and scheduledto be completed in June 2006. Total funding for bothphases is approximately CDN$60 million. The goal ofLGSP is to assist the government of the Philippines inrealising its objectives of equitable growth andpoverty reduction through effective local governancewith stakeholder participation. The programme sup-ported more than 300 LGUs in phase I with the num-ber reduced to 208 LGUs in phase II. LGSP Phase IIfocused on developing capacities in four outcomeareas that are aligned with the four key features ofthe Local Government Code. The phase II target out-comes are: (i) more efficient and effective local government leadership and management; (ii)enhanced access to and improved quality of services,especially for poor and disadvantaged groups; (iii)more equitable, efficient, transparent and sustain-able generation and utilisation of resources; and (iv)


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more effective and equitable participation by individ-uals, the private sector and civil society organisationsin local governance.

Fundamental to LGSP is the belief and assumptionthat local governments play a strong role in fosteringequity, security, inclusiveness and collaboration forsustainable social and economic development andpoverty reduction in communities in the Philippines.To be effective in fulfilling these roles, local govern-ments must work in collaboration with a wide variety of community groups, NGOs and the privatesector. To be sustainable, they need to be supportedby a well functioning regional administration andnational government agencies and other supportinginstitutions.

Phase I of LGSP was managed locally with oversightprovided by the Canadian Embassy in Manila. It wasimplemented initially in three administrative regionsin the southern Philippines and then expanded toinclude all six regions in Mindanao as well as theregion of Western Visayas. These regions were target-ed because of their high rates of poverty and ongo-ing conflict between rebel groups and the ArmedForces of the Philippines. Within each region an LGSPregional management committee was establishedunder the regional development council, chaired byNEDA (the government of the Philippines mecha-nism to coordinate development planning and pro-gramming at the regional level). Each managementcommittee hired a coordinator and was assigned alocally hired CIDA advisor to manage the implemen-tation of CD activities. Anchored in the regionaldevelopment councils, the programme responded toregional thrusts and worked with cities and munici-palities selected by the councils, resulting in a verystrong sense of local ownership. A mid-term evalua-tion of phase I recommended more coordinationamong the seven regional sub-programmes toincrease effectiveness, efficiency and sustainability.An LGSP National Programme Management Office(NPMO) was established in 1996 to create synergywithin the programme, streamline managementfunctions, and to improve results. Phase II wasdesigned to build on the achievements and lessonslearned in phase I, and to incorporate more compre-hensive strategies for CD, results-based manage-ment, replication and sustainability.

Phase II of LGSP is being implemented by AgriteamCanada Consulting Ltd, in association with the

Federation of Canadian Municipalities (FCM).Contracted by CIDA as an executing agency,Agriteam has assigned a programme director andemploys a team of Canadian and Filipino manage-ment, CD and governance specialists to implementthe programme in the field. The professional andtechnical Filipino staff from LGSP phase I were kepton to provide continuity and to ensure that theknowledge and expertise gained from implementingLGSP I would be applied to phase II. Direction setting,quality control, monitoring, assessment and report-ing are managed from the National ProgrammeManagement Office in Manila, but the majority ofthe CD activities continue to be planned and imple-mented by the regional LGSP offices in order to beresponsive and accessible to the partner local governments.

In phase II the programme works with 185 municipaland city governments and 22 provincial governmentsacross the seven selected regions (roughly 10% of thecities and municipalities in the country). LGSP man-agers, advisors and programme officers meet withLGU officials to identify and design specific sub-pro-jects that will meet the LGU's priority CD needs.Sub-projects are frequently subcontracted in wholeor in part to local experts, organisations and institu-tions referred to as local resource partners (LRPs).Sub-project activities are coordinated by a combina-tion of LGU and LGSP officials and results areassessed collectively by LRP, LGU and LGSP staff. Sub-projects frequently involve the participation of civilsociety and business groups, and include activities todevelop the capacities of community and private sector organisations to participate effectively in localgovernance.

The programme works closely with DILG at thenational, regional and local levels, as well as with theregional government of the ARMM, and with twonational leagues of LGUs. These partners are viewedas the key players within the enabling environmentfor local governance in the Philippines. They have acritical role to play in the dissemination, replicationand sustainability of exemplary practices in localgovernance and in local government CD. DILG, as thenational agency mandated to support LGU CD, hasbeen strategically involved in LGSP since its incep-tion. It chairs the programme steering committeethat oversees programme and provides strategicdirection and policy guidance to the programme.LGSP staff collaborate directly with DILG personnel in

programme implementation, regularly consultingDILG representatives at all levels. DILG also partici-pates as a programme partner to develop its owncapacity to assist LGUs and to provide national lead-ership within the local governance sector.

7.1 LGSP success factorsThere are several unique features of LGSP that havemade it successful in promoting and facilitating localgovernment CD in the Philippines.

1 The programme's size, scope and longevity haveallowed it to test, evaluate, document, refine andreplicate good practices in local government CDboth within and beyond programme-assistedregions. Begun in 1991, extended in 1999 with asecond phase to 2006, and replicated by a sisterprogramme, LGSPA, that will last until 2010, theprogramme represents a 20-year commitment onbehalf of CIDA to local governance strengtheningin the Philippines. This long-term programme hasallowed Canadians and Filipinos to develop a rela-tionship of respect and trust and knowledgeabout each other's approach to local governanceand capacity development. Filipinos within thelocal governance system understand LGSP andknow how, as an external agent, it can assistthem to meet their own goals.

2 The programme's use of in-depth system analysisand the development of comprehensive frame-works have been used to guide management, CDpractices and good governance principles.Programme managers and staff have extensiveexpertise in programme management, capacitydevelopment and local governance gainedthrough work and study in the Philippines andinternationally. The '4x4x4' CD framework andextensive performance information system andrelated resource materials and tools have not onlyguided project staff and partners in how they goabout their work, but have influenced govern-ment agencies and NGOs in the way they concep-tualise and support local government CD and performance improvement throughout thePhilippines. The programme's in-depth under-standing of local governance capacity develop-ment led to the development and use of effectiveCD strategies and knowledge products.

3 The programme's use of appropriate and innova-tive delivery methodologies that go far beyondthe traditional training sessions that so oftencharacterise CD assistance programmes. The pro-gramme relies on techniques such as peer-to-peerexchanges and on-site coaching to provide con-text-appropriate and cost-effective support.Learning experiences are designed to incorporateadult education methodologies that promoteactive learning and learning-by-doing. LGSP pro-vided training and professional development toits LRPs - the local individuals and organisationsthat it subcontracted to deliver capacity buildingactivities - to ensure that they were able to pro-vide high-quality experiences. LGSP staff ensuredthat capacity building experiences and materialsintegrated cross-cutting themes, and were cultur-ally appropriate.

4 The programme's embeddedness within local,regional and national CD efforts ensures localownership. From the fortunate historical begin-ning of phase I when programme managementwas under the direction of government ofPhilippines officials, to phase II where the man-agement team has ensured that the programmeactivities are in support of the development prior-ities of the partner LGUs, DILG and the nation,LGSP has been perceived as a 'donor-assisted' butnot a 'donor-driven' programme. LGSP phase IIhas worked alongside DILG and local resourceinstitutions to respond to each LGU's unique situ-ation and to support and assist LGUs to compre-hensively assess and identify their own prioritiesand to develop and measure changes in their owncapacity, performance and ultimately the benefitsto constituents. It has attempted to do this inways that are culturally appropriate and locallysustainable.

Mid-term and annual assessments of LGSP have foundthat in LGUs with high levels of readiness, the CD proj-ects supported by LGSP have helped the LGUs to sig-nificantly enhance their capacities (knowledge, skills,systems, plans, procedures, technologies, etc.) and touse them to deliver more and better services to theirconstituents and to perform their functions more effi-ciently and effectively. The CD strategy employed byLGSP where the highest degree of change wasobserved had the following characteristics:


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relationship building, and local knowledge creationand dissemination.

Strengthened networks and linkages. CD projects pro-vide LGUs with structured opportunities to form orstrengthen mutually beneficial relationships withother LGUs, other levels of government, communitygroups, NGOs, donors, financial institutions, and theprivate sector. Significant benefits resulted frominformal LGU clustering, alliance strengthening,replication project relationships, joint NGO-LGU andbusiness-LGU service delivery ventures and increasedCSO involvement in non-mandated local special bod-ies and advisory committees.

As support to each LGU was individualised based onneeds, interest and readiness, there was not a com-mon set of LGSP sub-projects provided to all LGUs.However, analysis of the LGUs that have achieved thetarget outcomes of LGSP, identified the existence ofsome commonalities. All high-performing LGUs par-ticipated in at least one project in each LGSP out-come area, and projects to develop local LGU leader-ship and management and participatory governanceusually preceded projects in other outcome areas.However, as many of the LGUs in LGSP II were alsoinvolved in LGSP I, a definitive pattern of interventionis difficult to establish. The 'minimum' interventionsin high-achieving LGUs appeared to be:

• support to develop an executive agenda or medi-um-term strategic plan for the LGU using a partic-ipatory methodology and highlighting the LGU'spriority issues;

• assistance to reconstitute mandated local specialbodies ensuring the participation of civil societygroups;

• assistance to develop a comprehensive land useplan where one did not already exist;

• support for community consultation to carry outpriority LGU projects (such as barangay gover-nance, local legislation consultation, or communi-ty-based initiatives in tourism, shelter, water,peace, health, etc.);

• assistance to improve management informationsystems, usually through computerisation offinancial and/or administrative systems;

• assistance to improve net revenue generation inthe LGU usually through increasing tax collectionand business licensing and permit efficiencyand/or through the more efficient operation ofpublic enterprises;


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Responsive to the LGU's priority needs. The CD pro-jects are based upon the LGU's requests and uponthe LGU's assessment of its own most pressingneeds. The interventions are not imposed by LGSP oroversight agencies.

LGU-led. The CD projects are supported by the mayorand each project has its own 'champion' within theLGU who takes responsibility to drive the initiativeand facilitate its integration into the LGU main-stream. Small LGUs with limited human and financialresources are not burdened with more projects oractivities than they have the capacity to manage.

Staged sequence and logical frameworks. CD initia-tives follow the LGSP four-stage process: consensusbuilding, capacity building, capacity application, andinstitutionalisation. Interventions are shaped by theLGSP frameworks such as those for local governmentcapacity, local economic development, local agricul-tural development and public economic enterprisedevelopment and management. Capacity needs inthe areas of local government leadership and man-agement and participatory governance are typicallyaddressed before needs in service delivery andresource generation and management. This ensuresthat these later initiatives are well planned and man-aged and that they involve citizens in all steps. Theexecutive agenda (EA) process at the beginning ofthe programme built the foundation for all furtherinterventions. In many cases the participatory gover-nance initiatives allowed LGSP staff to interact at thelocal level, helping to build rapport between LGSPand the LGU at all levels.

High-quality technical assistance. The benefit to theLGU depends in large part on the quality of the train-ing, coaching and resource materials delivered withinthe CD initiatives. The elements of quality includetechnical expertise, CD process expertise, appropriateadult education methodologies, and the frequencyand length of support. Successful CD interventionswere those where the LRPs and the LGSP staff provid-ed both technical skills and knowledge, and expertisein transferring them to others, where they main-tained the support over a sufficient length of time(several years) and followed up with on-site coachingat regular intervals (especially frequent visits fromthe programme officer), and where the LRP and LGSPstaff had a cooperative working relationship. Theappropriate methodologies included on-site coach-ing, peer-to-peer exchanges, supported replication,

2 Increased participation of citizenry, communitygroups, NGOs and the private sector in gover-nance. Reports note more public consultationevents, improved government communications,more civil society organisations (CSOs) and busi-ness representatives serving on governmentadvisory bodies and more joint service deliveryagreements between government, communitygroups and the private sector.

One LGSP local resource partner noted thatgreater community involvement in LGSP-assistedLGUs has instilled a shift in the thinking of theconstituents, from being passive recipients of LGUservices to being active participants in setting thecourse of the LGU.

3 Improved delivery of services in priority areas. Thisis evident from the number of LGUs that have ini-tiated and implemented such things as low-costhousing projects, potable water systems,improved agricultural extension services, naturalresource protection and rehabilitation projects,solid waste management systems, and employ-ment generation (livelihood support) schemes.

At a meeting of a newly established municipalvegetable and livestock trading centre communitymembers expressed their satisfaction with theLGU's improved ability to provide agricultural sup-port services. Farmers were sent for training invegetable production and the LGU established ademonstration farm for the farmers to put tech-nical training into practice. Farmers shared theirexpertise with other farmers and now thebarangay produces enough vegetables to selltheir surplus in a nearby city. The municipality hasrecently signed a memorandum of agreementdelegating the management of the trading centreto the farmers' cooperative.

LGSP has assisted 134 LGUs to complete shelterplans. Over 1000 low-cost housing units havebeen completed and many more are under con-struction and in the planning stages in participat-ing LGUs.

4 Increased ability to generate revenue and mobiliseresources. Of particular note is the number ofLGUs that have been able to use their well formu-lated development plans and priority agendas toattract and secure funding and assistance from


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• assistance to mobilise resources from sourcesexternal to the LGU including from donors, NGOs,financial institutions and national governmentagencies;

• assistance to improve the delivery of services in atleast two areas identified as priorities by the LGU.In most cases this included at least one projectrelated to environmental protection and manage-ment (waste, coastal resources, watersheds, etc.),and at least one related to the delivery of socialand economic development services (shelter,potable water, health, livelihoods, agriculturalextension and peace building); and

• support to coordinate and create synergy amongthe various projects within the LGU (both LGSPprojects and projects supported by others).

The programme reports the following key resultswithin the participating LGUs.

1 Improved planning and decision making. This isevidenced by LGUs having more required plans inplace, developing the plans in a more consultativemanner with staff and constituents, setting devel-opment priorities that are achievable and thatmeet priority community needs, and movingmore plans into action with task forces and moni-toring groups.

LGSP assisted each LGU through a participatoryprocess to formulate an 'executive agenda' basedon a comprehensive development plan and set-ting out the development priorities for the three-year term of office of local officials. One mayorstated, 'our executive agenda is our roadmap fordevelopment; it reflects the cooperation of ourpeople translated into realisable projects …'

One municipal planning and development coordi-nator noted that 'LGUs are now able to formulatean EA that prioritises the real community priori-ties … before LGSP, people were not part of theplanning process. Projects were at the caprice ofthe mayor. We saw complete failures becausethey were not responsive to community needs …with LGSP the local special bodies have been reac-tivated and there is also the Federation of CSOs …the LGU now solicits their involvement. Now we[the staff] enjoy working with the mayor - beforewe were not part of planning and now it feels likewe are'.

the priorities that were outlined in their EA.'Filling up the performance measurement [forms]became a group effort and not the task of a sin-gle individual. This way the results are shared bykey individuals in the LGU and they have a clearpicture of where they are in terms of the goalsthey set for themselves. They also build consensuson the assessment and on how to move forward.'

Several mayors and LGU officials spoke of theirincreased confidence in their ability to identifyand address their own challenges. The systematicassessment and development processes used todevelop the LGU's executive agenda and CD plans,and the improvements and successes achieved,seems to have empowered LGU officials to tacklemore complex issues.

7.2 Enabling environment - meso and macro level results

Reports and assessments have also noted the resultsof LGSP at the meso and macro levels within theorganisations, institutions and policy context thatform the 'enabling environment' for LGUs. LGSP's CDframework and sustainability strategy include signif-icant emphasis on the importance of the enablingenvironment for local governance in ensuring thatexcellence in local government continues to be pro-moted and maintained in the long term. This macro-level environment for local government includes LGUoversight, CD agents, the policies and regulationspertaining to local governments, fiscal support forlocal government and inter-governmental relations.A key actor within this macro-local government sys-tem is DILG, although it also includes other nationalgovernment departments and line agencies, the vari-ous LGU leagues, academic and research institutions,policy makers, donors, the private sector and civilsociety organisations. Roughly 70% of LGSP resourceswere allocated to supporting LGU CD and 30% toenhancing the enabling environment.

LGSP has focused its work within the enabling envi-ronment on four key groups: DILG (and DILG-ARMM),local resource partners (individuals, institutions andorganisations contracted to provide technical assis-tance to LGUs), CSO umbrella groups and LGUleagues. It has also initiated and supported effortstowards donor coordination.


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national government agencies, NGOs, donors andfinancial institutions. In addition, LGUs haveentered into alliances with neighbouring LGUs topool limited resources and have been able toincrease internal revenues from taxation andlicensing by updating and automating systems.One mayor commented, 'LGSP has taught us howto tap foreign assistance. LGSP has a list of poten-tial resource partners and the EA identified peo-ple's priorities so we could make proposals'. Arepresentative of a local institution providing technical assistance to LGUs describedLGSP's work as 'social preparation', exposing LGUsand communities to new models and global expe-riences. 'It is now easier for other projects to go toLGUs that have been prepared by LGSP.'

A municipal planning and development coordi-nator noted that improving participatory gover-nance has resulted in more effective servicedelivery and revenue generation. 'The communi-ty people are now paying taxes because of theservices that are now delivered to them … somepeople are now paying their delinquent taxesbecause they feel like they are getting somethingin return. The community also contributes moneyand manpower to delivery of the services.'

5 Increased appreciation and capacity for capacitydevelopment. Reports have consistently noted theincreased appreciation and understanding of theimportance of capacity and performance assess-ment, the link between capacity and perform-ance, and the importance of CD as a strategy toimprove performance for more effective gover-nance.

LGSP-assisted LGUs were more likely to link theirCD plans and activities to the LGU goals andaction plans (demand-driven), whereas non-assisted LGUs were more likely to randomlyaccess any available CD opportunities (supplydriven). Case study field researchers wrote thatmost non-assisted LGUs do not see the value oruse of performance assessment. LGSP was able toshow that performance measurement benefitsthe LGU because it serves as an input to develop-ment planning and the allocation of resources toimprove service delivery and respond to the needsof the constituents. Among the LGSP-assistedLGUs there has been a conscious effort to conductregular assessments of their performance vis-à-vis

the DILG regional directors chairing or co-chairingregional programme steering committees and beingactively involved in encouraging and enabling LGUsto participate in the programme. DILG operationsofficers based in LGUs were critical partners in pro-gramme delivery at LGU level, both as participants inthe capacity building activities and as agents of sus-tainability. The Local Government Academy was apartner in the design and delivery of several majorLGSP initiatives during which it was both a benefici-ary of technical assistance provided by LGSP resourcepeople and a provider of technical assistance toregional and provincial resource partners.

LGSP assisted DILG at the national level to strengthenits capacity to provide system-wide leadership withinthe local government system and to orchestrate andsupport CD programming for LGUs nationally. It pro-vided this support directly to DILG initiatives such asLGPMS, GoFAR, the national dissemination of theExecutive and Legislative Agenda (ELA) process, thestrategic organisational review, the establishment ofregional good governance resource centres. It alsoprovided support indirectly through discussions, jointprogramme planning and sharing of ideas, lessonslearned and knowledge products (manuals, trainingmodules, guide books and resource kits).

LGSP's assistance to the Local Government Academy(LGA) helped to improve the quality of its courses andprogrammes by providing several train-the-trainerprogrammes with expertise provided by theCanadian Local Government Leadership Institute.Programmes focused on increasing LGA's capacity intraining design and in delivering programmes thatwill help DILG officials become more effective men-tors, coaches and facilitators of LGU development.This increased capacity has allowed LGA to play a keyrole in implementing DILG's strategic shift from afocus on LGU supervision to a focus on assisting LGUdevelopment.

The need for support to LGUs in their capacity andorganisational development efforts will continuepast the life of LGSP. LGSP's strategy of working withpartners, and assisting LGUs to develop alliances,linkages and networks, will ensure that LGUs have avariety of partners on whom they can rely for assis-tance when needed, but without becoming depend-ent on them. Several LGU alliance councils and theirproject management offices that have beenstrengthened by LGSP will continue to support LGU


DILG has a complex and multi-faceted role in external interventions for local governance capacitydevelopment. At the same time as DILG is providingsystem-wide leadership and capacity developmentsupport to LGUs, it is itself evolving and developing.As the national agency mandated to provide LGUoversight and development, DILG provides externalcapacity building interventions for LGUs boththrough its officers at local, regional and nationallevels and through the Local Government Academy.At the same time, DILG has embarked on an endoge-nous capacity development process of its own, and isthe beneficiary of external capacity developmentassistance provided by various international net-works and donor-assisted projects including LGSP.

Over the past decade DILG has pursued a number ofcritical organisational changes, described to a certainextent in the LOGIC framework. It has attempted toshift the emphasis of its investments from oversightto development, spending less effort on enforcingLGU compliance to rules and regulations and moreeffort on supporting LGU development and promo-ting good local governance. It has modified the roleof the Local Government Academy from a provider oftraining and capacity building to a coordinator ofcapacity development assistance and provider ofresources. It has attempted to provide better infor-mation about LGU capacity and performance toLGUs, the department and other stakeholdersthrough the improvement of the LGPMS, and bettersupport for the replication of good practices throughthe Governance Facility for Adaptation and Replica-tion of Exemplary Practice (GoFAR). It has undertakena strategic organisational review, modified jobdescriptions, produced a variety of LGU resourcematerial, developed a website, set up regional goodgovernance resource centres and established a policyunit to support local government policy analysis anddevelopment.

In relation to LGSP, DILG has also had a multi-facetedrole - as a director of programming, as a partner inprogramme delivery and as a beneficiary of pro-gramme capacity development support. DILG provid-ed critical direction and leadership to the pro-gramme as the chair of the LGSP programme steer-ing committee and through the active involvementof a DILG assistant secretary and other senior staff inplanning and decision making. DILG has also part-nered in the delivery of LGSP capacity developmentactivities at national, regional and local levels, with

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development in the future. LGSP has assisted 85 localresource partners (LRPs) to develop their capacity tooffer effective training and technical assistance toLGUs. LGSP workshops for LRPs have helped themimprove their capabilities in coaching and facilitation,good governance, results-based project management,mainstreaming gender equality and environment,poverty reduction planning, peace building andpeace and conflict impact assessment. After LGSPassistance was completed, many LGUs have contract-ed LRPs on their own to continue to provide technicalassistance and capacity building services and toassist them to replicate successful LGU practices.

8 PerformanceThe causal linkages between interventions to sup-port CD and increased capacity, and betweenincreased capacity and improved performance aremore difficult to measure than to conceptualise.Performance is affected by multiple factors unrelatedto capacity, and changes in performance and result-ing client benefits may take years to observe. In the1980s DILG developed and implemented its firstLocal Productivity and Performance MeasurementSystem (LPPMS), which provided annual informationabout LGU service delivery capacities and limitations.In the late 1990s the system was revised and revi-talised as a 'self-assessment system' for LGUs to helpthem identify problem service delivery areas, takecorrective actions and detect the extent of improve-ments. The system provided useful information insome cases, but suffered from two important limita-tions. First, the technical elements of the systemwere not sophisticated enough to allow LGU or DILGofficials to tabulate and manipulate the data for thepurposes of research and analysis so the system wasrarely used as a tool for strategic decision making.Second, implementation focused primarily on com-pliance, not benefits, and the information was usedto create an LGU 'scorecard' rather than to guideinvestment in CD and performance enhancement.

Being involved in the development and use of theLGSP performance information system helped DILGto rethink and conceptualise its own system. WithLGSP and ADB support, DILG refined the LPPMS tocreate a comprehensive Local Government

Performance Measurement System (LGPMS). The sys-tem provides a framework as well as tools to meas-ure the performance of LGUs in carrying out theirmandate and in demonstrating the principals ofgood governance, and guidelines for the effective useof the information by LGU and DILG officials. LGSPassisted DILG to increase LGU participation in thedevelopment, testing and refinement of the system.The process to develop LGPMS has also facilitated theimplementation of LOGIC as the links between thetwo frameworks became increasingly clear.

LGPMS measures two performance areas related tohow LGUs carry out their functions (governance andadministration) and three performance areas relatedto the delivery of services (social services, economicdevelopment and environmental management). Eachperformance area is divided into service areas withindicators for inputs, outputs and outcomes. Theinputs refer to the systems, structures, tools, plansand human resources required within LGUs to achievethe outputs and outcomes; in other words, the organ-isational capacity required to effectively perform thefunctions and carry out the responsibilities of an LGU.The outputs refer to the quality, quantity, relevance,effectiveness and efficiency of the actions that theLGU actually takes; in other words, the LGU's level ofperformance in carrying out its responsibilities. Theoutcomes refer to the impact of the LGU's decisionsand services on its constituents; in other words, thesocial and economic wellbeing of the citizens.

The LGPMS is a self-assessment tool that assists LGUsto identify their performance strengths and gaps andto identify priority areas in which to improve. Thus ithelps LGUs define their capacity strengths and weak-nesses. As a national monitoring system, it providesDILG with information about service and perform-ance areas in which it may wish to focus CD supportthrough its own programming and by bringing areasof need to the attention of the other CD 'enablers'and 'providers' as set out in LOGIC.

Extensive user manuals and tools for data collection,input, reporting and analysis have been developed.DILG field-tested LGPMS in selected LGUs in 2004,modified and then launched the programme nation-ally in 2005. The implementation required a compre-hensive communication campaign to help LGUsunderstand the system and its usefulness. Prior toLGPMS most LGUs did not assess their strengths,weaknesses, capacities and performance related to


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general concepts such as 'good governance'. Theywere more likely to identify specific needs such ashealth services or revenue generation as areas inwhich they needed to improve their capacity andperformance. However, several key leaders withinDILG, encouraged by donor representatives (LGSP,ADB, UNDP) and by the President's Office (good governance and anti-corruption advocates), wereinstrumental in ensuring that the performance areasof 'governance' and 'administration' were includedalong with indicators for transparency, accountabilityand participation.

Developing the tool was a time-consuming processthat included consultation with DILG staff, other government departments, donors, academic experts,and representatives from the leagues of cities andmunicipalities. Every stakeholder had interests in dif-ferent data, and the first list of proposed measureshad over 1400 indicators! The DILG whittled the num-ber down by trying to focus on elements of LGU capac-ity (inputs) and performance (outputs) that wouldmost likely contribute to the attainment of nationalgoals for poverty reduction and economic growth asset out in the Government of the Philippines Medium-term Development Plan. They also discarded indicatorsthat they considered too subjective or difficult andcostly to measure. The resulting LGPMS provides man-agement information for both individual LGUs toassess their own strengths and weaknesses, planimprovements and measure change over time, and forDILG as an oversight agency.

The LGPMS provides DILG with a tool for monitoringand evaluation. DILG staff involved with LGU over-sight can use LGPMS reports to identify how LGUs areperforming in relation to standards and benchmarksand how their levels of capacity and performance arechanging over time. DILG staff involved in LGU devel-opment can analyse the reports to identify areas inwhich individual LGUs or groups of LGUs need devel-opment assistance and to identify individual LGUs orgroups of LGUs that are performing exceptionallywell and may be able to provide models of exemplarypractice for documentation and replication. Whetheror not DILG and other local governance leaders andresearchers make use of the system information toinform capacity development, investment and policydecisions in the future is yet to be seen.

The process to develop the system tools provided anopportunity to strengthen the overall local gover-


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nance system, as it helped DILG forge stronger rela-tionships with leagues and donors working in thelocal governance 'sector' and helped stakeholderscome to consensus on what capacities LGUs neededand what realistic performance standards should be.At the Philippine Development Forum annual meet-ing in 2004, bilateral donors agreed to work withDILG to finalise the LGPMS and to use 2005 nationaldata for planning and monitoring their aid pro-grammes for local governance. Some non-bilateraldonors are yet to support this consolidated effort andcontinue to use their own measures of LGU capacity.

The refinement of the LGPMS was influenced to acertain extent by LGSP. At the beginning of phase II,LGSP staff developed a comprehensive performancemeasurement framework and performance informa-tion system to help measure the results of LGSP acti-vities and to modify programme strategies and activi-ties based on successful projects and practices. Whendeveloping the system, LGSP managers and staffrecognised the opportunity to create a system thatwould not only measure the performance of LGSP butcould contribute to the achievement of programmeoutcomes by developing the capacity of LGUs andother partners in performance measurement andmanagement, a key competency identified within theoutcome area of 'local government leadership andmanagement'. Using expertise provided by Agriteamand FCM, as well as LGSP Filipino staff and DILG, LGSPdeveloped a performance information system (PIS)that included 49 output indicators (with over 300 ele-ments or sub-indicators to assist assessment) thatmeasured LGU capacity and outputs in all four LGSPoutcome areas, and all four cross-cutting themes.Many of the LGSP indicators and assessment ele-ments were taken directly from DILG's LPPMS.

Several benefits ensued from the inclusion of LPPMSdata in the LGSP system. First, by integrating LGUs'own LPPMS data into LGSP reports it emphasised theimportance and validity of self-assessment to LGUofficials and lent credibility to LGSP progress reportsat the LGU level. Second, by using tabulated LPPMSdata along with LGSP data in various types of analyt-ical reports, LGSP was able to demonstrate the use-fulness of performance data in system analysis andprogramme planning. As a result, DILG invited LGSPto assist it with the development of LGPMS.

Assistant Secretary Austere Panadero of DILG hasstated that LGSP has provided an approach to CD


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that DILG finds useful: 'The approach is participatoryand includes measurement of performance throughindicators and a database. This gives before and aftersnapshots of the LGU and is a useful tool for plan-ning and assessment'. He felt that the LGSP approachto performance management had helped clarify thelink between capacity building and performancewhich contributed to DILG's framework for LGPMS.

LGSP programme officers stated that the delivery ofcapacity building had been successful because it hadbeen translated into outcome-level impact when theLGUs eventually adopted practices and systems thatallowed them to govern better. They provided manyspecific examples of how the basic LGSP results chain(see figure 3) was realised in different sectors. Forexample, they cited CD for solid waste managementthat included the facilitation of orientations, studytours, training, public consultations, the developmentof a solid waste management plan, the adoption ofnew solid waste systems and technologies, resultingultimately in a reduction in the amount of uncollect-ed garbage in several municipalities.

The LGPMS structure follows the same basic logic ofLGU inputs (organisational capacities) leading to outputs (organisational performance) leading to out-comes (development benefit). As LGPMS is now beingimplemented in several hundred local governmentsin the Philippines, it provides an exciting opportunityto examine the causal linkages and analyse the rela-tionships between LGU capacities, performance anddevelopment impact. Analysis may well show thatsome capacities thought to be necessary for per-formance are not prerequisites at all. It may alsoshow that a small, key set of indicators is sufficientto monitor performance. LGSP, in its final year ofoperation, will assist DILG and other system stake-holders to undertake such analysis.

Anecdotal reporting by LGSP partners and staff clear-ly links increased capacity to improved performance.One municipal planning and development coordina-tor commented that 'after the capacity building forcommunity-based tourism we're now seeing results.We're very impressed with the new communitytourism sites and the way the tourism guides havedeveloped and are gaining confidence in facilitatingcommunity tours. Before they were insecure - nowthey are proud of their barangays. Now we have agood tourism plan, outlining how to manage com-munity-based tourism. Before we had a plan butnothing happened. It was top-down planning andour motivation was compliance. Now that we areaware of how much the community needs this, weare motivated by the urgency and we push forchange. This understanding came through the learn-ing during actual community consultation and com-munity involvement in planning facilitated by LGSP'.

Several mayors commented on the role of con-stituents in performance management. They agreedthat when constituents hold government account-able and demand participation in governance, localofficials are forced to make efforts to do a better job.A leader of a local NGO agreed, saying that 'theinvolvement of civil society organisation is critical.They will make noise if the mayor backslides or if theLGU administration does not respond to their needs'.

Some LGUs have noted an increase in tax paymentsthat they attribute to public acknowledgement thatbetter services are now being delivered. Somebelieved that even delinquent taxes were being paidbecause people felt like they were now gettingsomething from the government in return for theirtax payments. These LGUs felt that the improvementin service delivery was a result of performance andcapacity improvements initiated by the LGU.

Support to Capacity Development

Programme

Inputs

Enhanced LGU Capacity

Programme

Outputs

Improved LGU Performance

Programme Outcomes

Benefits to Citizens

Development

Impact

Figure 3. LGSP results chain


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There appears to be public recognition of theimproved performance of LGUs resulting from CD. InLGSP-assisted LGUs there is less political oppositionto the mayors as the people seem to be satisfiedwith them. In the local government elections in May2004, of the mayors running for re-election in theregions supported by LGSP, 78% of incumbent mayorswere re-elected in LGSP-assisted LGUs compared to58% of incumbent mayors in non-assisted LGUs.

One mayor summed up his attitude about the linkbetween capacity building, LGU performance anddevelopment as follows: 'No one is motivated to goto a training programme in order to build capacity;people are motivated to change because of theirvision for a brighter future'.

9 ConclusionThis case study describes a process of endogenouscapacity development and change that has takenplace over the past 13 years within local governmentunits in the Philippines. It illustrates the influence ofa changing social and political context and accompa-nying major national policy change - the enactmentof the Local Government Code - on the demand forcapacity development both within the LGUs them-selves and within the local governance system andenabling environment.

The case suggests that the development of capacityin LGUs and the related improvements in their per-formance are functions of the relationship betweenfeatures internal to the LGU with the features ofexternal interventions. It recognises the significantrole played by LGU leaders and community stake-holders in LGUs' approach to CD.

The concept of CD presented in the study is an opensystems model that considers CD as an ongoingcyclical process occurring at various levels within thesystem and including strengthening of the linkagesbetween the levels. The staged process includes con-sensus about the need for change, learning andcapacity strengthening activities, application ofenhanced capacity to improve performance, institu-tionalisation of organisational changes and thenanalysis and further consensus about addition needs

for change - the cycle repeating itself throughout thelife of an organisation.

Endogenous capacity development occurs in contextswhere the social, political and economic context isconducive to change. External support can be effec-tive in facilitating and enhancing the CD processwhen it is geared to the specific internal conditionsof organisations and when it helps them functionmore effectively within their institutional and sys-temic environment. The Philippines-Canada LocalGovernment Support Program was presented as anexample of a programme that was effective in pro-viding external CD support to endogenous changewithin local governments in the Philippines. The keysto LGSP's success include:

• Broad scope and longevity. LGSP worked with acritical mass of local government units in thecountry (more than 200 LGUs, representing over10% of the cities and municipalities in the coun-try) and has lasted for 16 years.

• Extensive knowledge and analysis of capacitydevelopment, local governance and programmemanagement. LGSP, especially in phase II, devel-oped and used comprehensive frameworks,strategies and tools to train staff and provide thebest possible CD assistance while ensuring localownership.

• Use of appropriate and innovative CD supportmethodologies. LGSP developed and trained staffand sub-contractors to use methods beyond typi-cal training to facilitate change, including suchthings as on-site-coaching, peer-to-peer learning,and facilitated replication.

• Embeddedness within local, regional and nationalLGU CD efforts. LGSP tried to ensure that all of itsactivities supported the endogenous efforts ofthe LGUs themselves, as well as those of DILG andother partners, thus ensuring local ownership andincreasing the likelihood of sustainability.

Appendix: List of IntervieweesMayor Arthur D. Davin, Municipal Mayor, Magsaysay, Davao del Sur Mayor Peter Melchor Arches, Municipal Mayor, Bansalan, Davao del SurMayor Ernesto Templonuevo, Municipal Mayor, Numancia, AklanMayor Raymar Reblado, Municipal Mayor, Kalibo, AklanMr Clementino Daydayan, Municipal Planning and Development Coordinator, Magsaysay, Davao del SurMr Joel Bulangkit, Municipal Local Government Operations Officer, Magsaysay, Davao del SurMs Rosario Moreno, Municipal Accountant, Bansalan, Davao del SurMr Arnel Gallardo, Council Member, Bansalan, Davao del SurMr Narciso Batingal, Municipal Engineer, Bansalan, Davao del SurMs Amor Amploquio, Municipal Planning and Development Coordinator, Bansalan, Davao del SurMr Fuller Mationg, Municipal Local Government Operations Officer, Numancia, AklanMr Rosendo Briones, Municipal Planning and Development Coordinator, Numancia, AklanFarmers' Cooperative Members, Magsaysay, Davao del SurMr Austere Panadero, Assistant Secretary, Department of the Interior and Local GovernmentMs Marivel Sacendoncillo, Executive Director, Local Governance AcademyMs Liza del Norte, Project Coordinator, Institute for Primary Health Care, Davao Medical School FoundationMs Monique Villanueva, Associate Consultant, MINPHIL ConsultantsMs Connie Pabalan, Development Academy of the Philippines Ms Luz Rodriguez, Executive Director, Galing Pook FoundationMr Rod Sollesta, National Economic and Development AuthorityMs Victoria Maglana, Programme Officer, LGSPMs Gloria Adapon, Programme Officer, LGSPMs Divina Lopez, CSO Advisor, LGSPMs Teresita Gajo, Area Manager, LGSPAtty. Evelyn Camposano-Jiz Area Manager, LGSPMr Rizalino Barandino, Programme Officer, LGSPMs Fe Salcedo, Programme Officer, LGSPMs Marion Maceda-Villanueva, Field Programme Manager, LGSPMr Basile Gilbert, Governance Advisor, LGSPMs Myn Garcia, Communications Advisor, LGSP


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Bibliography

Carlton, B., 2000. Federation of Canadian Municipalities, International Centre for Municipal Development(1997), presented in LGSP Phase II Program Implementation Plan. Ottawa: Agriteam Canada.

Lavergne, R., Lewis, E. and Pécore-Ugorji, D. 2004. Capacity Development in CIDA's Bilateral Programming: AStocktaking - Research Results. Ottawa: CIDA (draft).

LGSP. 1999. Shaping the Future: The LGSP Experience. Makati City: Philippines-Canada Local GovernmentSupport Program.

LGSP. 2000. Local Government Support Program Phase II Program Implementation Plan. Gatineau: AgriteamCanada.

LGSP. 2002. Program Progress Report: October 2001-March 2002. Gatineau: Agriteam Canada. LGSP. 2004.Program Progress Report: October 2003-March 2004. Gatineau: Agriteam Canada.

LGSPA. 2004. Local Governance Support Program in the Autonomous Region in Muslim Mindanao ProgramImplementation Plan. Gatineau: Agriteam Canada.

Lina, J. 2003. Decentralization and local empowerment: the Philippines experience, in A. Brillantes, Jr, et al.(eds), Decentralization and Power Shift: An Imperative for Good Governance, Volume II. Quezon City: Centre for

Local and Regional Governance, University of the Philippines.

Yule, A. 2002. Capacity Development for Excellence in Local Government. Presented at the InternationalSymposium on Capacity Development, Manila, October, sponsored by the World Bank Institute, UNDP, JICAand CIDA.


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The European Centre for Development Policy Management (ECDPM) aims to improve internationalcooperation between Europe and countries in Africa, the Caribbean, and the Pacific.

Created in 1986 as an independent foundation, the Centre’s objectives are:• to enhance the capacity of public and private actors in ACP and other low-income

countries; and • to improve cooperation between development partners in Europe and the ACP Region.

The Centre focuses on four interconnected themes:

• Development Policy and EU External Action• ACP-EU Economic and Trade Cooperation• Multi-Actor Partnerships and Governance• Development Cooperation and Capacity

The Centre collaborates with other organisations and has a network of contributors in the European and theACP countries. Knowledge, insight and experience gained from process facilitation, dialogue, networking,infield research and consultations are widely shared with targeted ACP and EU audiences throughinternational conferences, focussed briefing sessions, electronic media and key publications.

This study was undertaken by ECDPM in the context of the OECD/DAC study on Capacity, Change andPerformance and financed by the Canadian International Development Agency (CIDA), the UK Department forInternational Cooperation (DfID) and the Swedish International Development Agency (SIDA)

The results of the study, interim reports and an elaborated methodology can be consulted atwww.ecdpm.org/dcc/capacitystudy. For further information, please contact Ms Heather Baser([email protected]).

ISSN 1571-7577

The European Centre forDevelopment Policy ManagementOnze Lieve Vrouweplein 21NL-6211 HE Maastricht, The Netherlands Tel.: +31 (0)43 350 29 00Fax.: +31 (0)43 350 29 [email protected] www.ecdpm.org

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