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Province of CebuIntegrity Mechanisms and Models forBusiness and Investment Promotion

CONTENTS

Cebu List of Abbreviations 4

Introduction 7Overview of the Project I4J 7Rationale 9Objectives 10Policy Framework for Integrity 11Strategies and Approaches 13

Province of Cebu Profile 17Integrity Circles 21Technical Working Group 23

Integrity Mechanisms 25FOCUS AREA 1: Local Chief Executive 26FOCUS AREA 2: Dealing with Employees 26FOCUS AREA 3: Dealing with the Public 26FOCUS AREA 4: Dealing with Business Partners 26FOCUS AREA 5: Dealing with Fiscal Administration 27FOCUS AREA 6: Dealing with Communities, Environment and other Key Stakeholders 27

4

List of Abbreviations

APCPI Agency Procurement Compliance and Performance Indicators

BAC Bids and Awards CommitteeCDPI Centrist Democracy Political InstituteCIAN Cebu Investment Assistance NetworkCIPO Cebu Investment Promotions OfficeECCP European Chamber of Commerce of the PhilippinesFGD Focus Group DiscussionGPPB Government Procurement Policy BoardHRMO Human Resources Management OfficeIC Integrity CircleICT Information Communication TechnologyISAT Integrity Self Assessment ToolIT Information TechnologyKAS Konrad Adenauer StiftungLCP League of Cities of the PhilippinesLGU Local Government UnitLMP League of Municipalities of the PhilippinesMOA Memorandum of AgreementPAC Provincial Accountant’s OfficePAD Provincial Administrator’s OfficePAS Provincial Assessor’s OfficePBIS Performance-Based Incentive System

5

PBO Provincial Budget OfficePENRO Provincial Environment and Natural Resources OfficePESO Provincial Employment Services OfficePGSO Provincial General Services OfficePIO Provincial Information OfficePMT Project Monitoring TeamPTO Provincial Treasurer’s OfficeQC/QCC Quality Circle/Quality Control CircleTWG Technical Working Group

Magellan’s Cross

7

Overview of the Project I4JBeginning January 2014, the Konrad Adenauer Stiftung

(KAS) has implemented the project “Partnerships for Integrity and Job Creation – Local Governments and Civil Society Cooperate for Integrity and Transparent, Effective Small Business Registration and Promotion Procedures” (Project I4J). The three-year Project I4J is co-founded by the European Union and the German Ministry for Economic Cooperation and Development through KAS. The Project focuses on the pilot development of integrity mechanisms and models of transparent and effective small business and investment registration and promotion procedures at selected local government units (LGUs), in cooperation with civil society and decision makers at these LGUs.

The overall objective of the project is to contribute in the reduction of poverty in the Philippines through integrity and sustainable creation of jobs. Specifically, it aims to include LGUs as key players for clean administrative procedures into the Integrity Initiative set up by the European Chamber of Commerce of the Philippines (ECCP) and the Makati Business Club. It recognizes the role of LGUs as a sustainable network for self-obligation and monitoring of transparent and uncorrupt structures and procedures. It also aims to create models of transparent, effective small business and investment registration and promotion procedures and disseminate them.

Introduction

Magellan’s Cross

8 PARTNERSHIPS FOR INTEGRITY AND JOBS (PROJECT I4J)

The Project targets local government leaders/officials, civil society, small business leaders and potential investors in the nine (9) pilot LGUs. Citizens dependent on local public services and/or seeking employment in municipalities/cities all over the country are the final beneficiaries of the Project. Three (3) cities, three (3) municipalities, and three (3) provinces across Luzon, Visayas and Mindanao are selected as pilot project locations.

MUNICIPALITIES: Naujan, Oriental Mindoro (Luzon)Tuburan, Cebu (Visayas)Iranun Cluster, Maguindanao (Mindanao)(Parang, Buldon, Barira & Matanog)

CITIES: Puerto Princesa (Luzon)San Carlos City, Negros Occidental (Visayas)Cagayan de Oro City, Misamis Oriental (Mindanao)

PROVINCES: Oriental Mindoro (Luzon)Cebu (Visayas)South Cotabato (Mindanao)

Together with KAS, the Integrity Project is implemented by the European Chamber of Commerce of the Philippines, the Leagues of Cities of the Philippines (LCP), the League of Municipalities of the Philippines (LMP), the League of Provinces of the Philippines (LMP) and the Centrist Democracy Political Institute (CDPI).

9INTRODUCTION

RationaleThe low budget share and poor quality of the education

system, the non-existence of relevant research promotion for innovative economic development, the lack of adequate supportive infrastructure for production and marketing activities in the vast agricultural areas of the country – high electricity prices, bad roads, high transportation and service costs are all directly related to the failure of national policies. However, the other key reasons are related to flaws and failures many of the LGUs in the country including too much dependence on funding from the national government.

The link between good governance, transparency and integrity, on one hand, and high levels of investment as well as business performance, on the other hand, has been recognized in the studies by the World Economic Forum in their Global Competitiveness Reports. This is because a business venture decision must begin with having trust in the community where an investment is to be made.

There is a direct connection between integrity and jobs although this is not very obvious in the short run.

Many poor farmers, fishermen, craftsmen, vendors and other small business owners face the problem of highly non-transparent, cumbersome and costly procedures at local administrations. Good progress is being reported in some models at LGUs but these are few and far between. The problems are not only caused by complicated or unclear regulations or lack of guidelines for these regulating activities at local administrations. It is also aggravated by business policy changes and the lack of long-term investments at the local government units.


It is common to hear efforts of powerful families and clans at many places to use the local administrations, controlled by them through the linkage of economic power and political positions, to protect their dominant market positions against potential competitors. As a result many local markets are closed markets with low competition and comparatively high prices. The Philippines has a very low rate of only about 10% of their total active labor force employed in the formal sector.

Investors – whether large scale capitalists or small entrepreneurs – must strongly believe that a particular social and political setting will produce returns for their ventures and investments. Integrity and the availability of information promote accountability and greater predictability of outcomes.

ObjectivesAt the end of the project, it is expected that:

1. Integrity mechanisms and small business registration and promotion models are implemented in the nine pilot places;

2. The time and costs for delivery of public services to citizens at the nine pilot places have been reduced;

3. The increase of small business registrations and investment projects has led to the creation of new jobs at the pilot LGUs;

4. A high number of LGUs has joined the Integrity Initiative;5. A network of Integrity Circles has been set-up countrywide;

and6. Results of the models in the pilot places are accessible for

all LGUs in the Philippines and these are disseminated by the three Leagues to their members for replication

11INTRODUCTION

Specifically, the project aims to include LGUs as key players for clean administrative procedures into the Integrity Initiative set up by the European Chamber of Commerce of the Philippines (ECCP) and the Makati Business Club. It recognizes the role of LGUs as a sustainable network for self-obligation and monitoring of transparent and uncorrupt structures and procedures. It also aims to create models of transparent, effective small business and investment registration and promotion procedures and disseminate them.

Policy Framework for IntegrityTo combat systematic corruption, institutionalizing

transparency and accountability in governance, with rules in place that pertain to full disclosure, freedom of information, public declaration of personal assets, and open invitation to public scrutiny is a better and doable alternative.

Existing Philippine laws and regulations are not wanting in putting in place good governance and integrity in public service. The following are the national laws and policies that provide the policy framework for the institutionalization of integrity in Philippine governance and systems. • 1987 Philippine Constitution: Article XI – Accountability of

Public Officers • Revised Penal Code: Title VII – Crimes Committed by Public

Officers (1930) • Republic Act No. 1379 – An Act Declaring Forfeiture in Favor

of the State Any Property Found to have been Unlawfully Acquired by any Public Officer or Employee (1955)

• Republic Act No. 3019 – Anti-Graft and Corruption Practices Act (1960)


• Presidential Decree No. 46 – Making it Punishable for Public Officials and Employees to Receive, and for Private Persons to Give Gifts on any Occasion, including Christmas (1972)

• Presidential Decree No. 749 – Granting Immunity from Prosecution to Givers of Bribes and other Gifts and to their Accomplices in Bribery and other Graft Cases Against Public Officers (1975)

• Republic Act No. 6713 – An Act Establishing a Code of Conduct and Ethical Standards for Public Officials and Employees, to Uphold the Time-Honored Principle of Public Office being a Public Trust, Granting Incentives and Rewards for Exemplary Service, Enumerating Prohibited Acts and Transactions and Providing Penalties for Violators Thereof and Other Purposes (1989)

• Republic Act No. 7080 – An Act Defining and Penalizing the Crime of Plunder (1991)

• Republic Act No. 9160 – An Act Defining the Crime of Money Laundering Providing Penalties Therefor and for Other Purposes (2001)

• Republic Act No. 9485 – An Act to Improve Efficiency in the Delivery of Government Service to the Public by Reducing Bureaucratic Red tape, Preventing Graft and Corruption, and Providing Penalties (2007)

• Republic Act No. 10365 – An Act Further Strengthening the Anti-Money Laundering Law, Amending for the Purpose Republic Act No. 9160, otherwise known as the Anti-Money Laundering Act of 2001”, as amended (2013)

13INTRODUCTION

Strategies and ApproachesThe Integrity Circles Strategy

The Integrity Circle (IC) is the formation of networks of friends: representatives of government, business, and civil society organizations who are active in the community, are committed to the ideals of honesty, simplicity and professionalism, and could contribute good ideas on integrity. The IC approach is similar and complementary to the Quality Control Circles (QCCs or QCs) that was introduced by the Japanese in the business sector in the 1960s which helped Japanese companies achieve world-class product quality.

In the context of this project, as ICs are created among stakeholders, a collective action among them will be created to safeguard the integrity standards of the locality. By bringing all these ICs, a local Integrity Consortium can be formed to promote exchanges of best practices and improved coordination as well as enhance cooperation among stakeholders. Accountability for behavior and integrity is the cornerstone of the circle-building process. Within the circles, people are held accountable for their actions and commitments.

The External Assessment Tools External Assessment is conducted using two methods:

a) focus group discussions (FGD) and b) in-depth interviews. Third party experts conduct FGDs at the pilot places, providing assessment reports with the outcomes of the discussions, evaluation of the results and recommendations. In addition, in-depth interviews are conducted by the key technical staff of the project (Project Director, Project Manager, Project Coordinators of CDPI and ECCP) with selected personalities from the local


government unit, local business and civil society at the pilot places. During these interviews, identification of potential members of the Integrity Circles takes place too. The draft reports based on the results of the FGDs and additional interviews are communicated and discussed with the LGU and key members of the local business and civil society involved before the final version is produced.

The outcomes and results of the assessment studies are the basis for designing the models for transparent, efficient and effective small business and investment procedures at the pilot LGUs. The models are designed on concrete observations and facts in these fields in order to actually measure the improvement during the trial implementation process.

The Self-Assessment Tool The Integrity Self-Assessment Tool (ISAT) for LGUs aims

to assist signatories of the Integrity Pledge in examining the scope and effectiveness of integrity policies and practices in their respective LGUs. This tool provides a framework that examines focus areas known to be susceptible to corruption and puts forward a set of control measures that can address these vulnerabilities. It gives LGUs an idea on how they fare in terms of integrity practices. More importantly, the assessment tool provides areas for improvement to strengthen the LGUs‟ overall integrity practices.

The ISAT is organized around six (6) focus areas. The first focus of the tool enumerates a series of statements regarding the local chief executive‟s policies and practices that promote and institutionalize integrity in the LGU. The other five focus areas are composed of statements related to the ways in which the LGU ensures that integrity is practiced when dealing with employees,

15INTRODUCTION

the public (clients), business partners, fiscal administration and communities, environment and other key stakeholders.

The Web of Institutionalization Model The Project I4J established a Technical Working Group

to draft the design for integrity mechanisms and models for business and investment promotion.The TWG adopted the Web of Institunalization Model as the conceptual framework to integrate the value of integrity in the government. The model uses 13 elements which provide a means not only for guiding and even structuring a diagnosis of the existing status of integrity institutionalization, but once assessed, can indicate room for maneuver for change and provide a means for directing action to promote institutionalization.

Implementation of the Integrity Model and Mechanisms Once the Integrity Model or Mechanisms is formulated

and validated by the Integrity Consortium, the reform models of integrity mechanisms for business registration and investment promotion will be implemented in a trial process step by step with the participation of the civil society and the local business sector.


Sumilon Island

17

Province of Cebu ProfileCebu is located 365 miles south of Manila, the capital of

Philippines. The province belongs to the country’s Central Visayas Region. It can be reached in an hour by air travel or 22 hours by cruising the sea.

Cebu is characterized by narrow coastlines, limestone plateaus, coastal plains but with predominant rolling hills and rugged mountain ranges traversing the northern and southern lengths of the island. Although Cebu’s steep mountains reach over 1,000 meters, the island lacks substantial forest cover. In the towns of Bogo, San Remigio, Medellin, and Daanbantayan at the northern tip of the province, considerable tracts of land are found. Of the three biggest islands, Mactan and Bantayan are relatively flat while Camotes is hilly.

Cebu Province has a total population of more than 4.2 million. Cebuano is the native tongue. While Filipino is commonly understood and spoken, the English language is widely used in business transactions and education.

Even before the Spanish colonization, Cebu already played a vital role in trade and commerce in Asia because the island has been gifted with a natural harbor. Its channel is deep enough to accommodate the flow of goods through international cargo sea vessels, and the Mactan island serves as protection from winds and current.

Sumilon Island


Cebu’s weather promises to be good for business because typhoon activities are minor and rainfall is evenly distributed throughout the year. Moreover, the island is not located within any earthquake belt, there is no known active volcano, and its international airport has been large enough to connect the island to several continents.

The public administrators of the province have been known to be development-oriented, steering Cebu to greater heights by putting in place infrastructure facilities needed for economic growth. Cebu has at least nine economic zones that offer to cut bureaucratic red tape by providing a much easier system for investors, plus incentives.

It is number one because of good fiscal management: it ranks highest among the country’s provinces in terms of assets and cash in bank. Most importantly, Cebu ranks number one because of the current unity that has never been seen before in any province: unity among elected officials, unity among business groups, unity among its people, and unity between the private and public sectors.

There are many universities and other educational institutions that serve as magnet to students from other provinces, a major factor of a highly skilled and efficient workforce in Cebu.

Overall, Cebu continues to excel and investors are drawn to Cebu because of the culture of professionalism and craftsmanship among its people, the vast highly skilled manpower resources resilient amid trying times, its fair weather, relative peace and business-friendly atmosphere.

19PROVINCE OF CEBU PROFILE

Pilot LGU in VisayasIn coordination with representatives from the three local

government leagues (League of Cities of the Philippines, League of Municipalities of the Philippines and League of Provinces of the Philippines), three (3) cities, three (3) municipalities and three (3) provinces across Luzon, Visayas and Mindanao were chosen as the pilot LGU partners of Project I4J.

The pilot areas were selected based on the results of a Preliminary Assessment that was conducted by the Project I4J Team. The preliminary assessment of the nine (9) pilot areas also intended to provide a situationer and reference for succeeding activities and interventions.

There are three (3) parts in the preliminary assessment. The first is a brief profile of each pilot LGU where industries in the area, problem areas and possible solutions are also outlined. The second part is classification matrix classifying each pilot LGU based on the profiles. The indicative scale is intended to offer possible intervention approaches based mainly on the conditions revealed in the profiles. The third main part is a look at the pilot LGU’s local revenue generating capacity and thus the rate of dependence on their share from national taxes or the Internal Revenue Allotment. Any study on local governance, particularly in assessing performance requires a look at revenue generation. This does not only show the fiscal capacity of each LGU but also reveals the policy and program orientation of the LGU.

From the foregoing profiles, the conditions and needs of each pilot LGU are further classified to determine the appropriate intervention and initiatives on integrity could be best implemented for each pilot LGU. To easily have a handle of these varying conditions, problem areas and development


opportunities, particularly where, a matrix is formulated as easy reference.

The matrix consists of five (5) main characteristics necessary to assess the situation in an LGU were provided as follows:1. Politically Stable - this means that there may be political

opposition but it does not necessarily affecting the work of the LGU;

2. Law and Order - simply means there is rule of law and that violence and conflict is not a concern;

3. Relatively Structured Local Bureaucracy – there is indication of coordination among local departments and therefore organized as institutions and not significantly affected by personalities;

4. Stable Power Situation and Adequate Infrastructure, meaning electricity is not a problem as in some areas outside Manila and that roads, bridges, even ports show adequately able to provide accessibility; and

5. Varied industries, where the local community enjoys a dynamic local economy where there is a good mix of merchandising, possibly manufacturing and or food processing and even tourism and not dependent on limited agricultural production.


Integrity Circles Integrity Circles are set up in the pilot LGUs. Personalities

from key organizations belonging to each of the target group (local government unit, business sector, civil society) were identified through well prepared visits and small informal meetings during the Assessment Phase (June 2014 – March 2015).

The members of the Integrity Circle are chosen based on the following criteria: 1. Good reputation 2. Professional competence 3. Independence 4. Strong belief in the necessity of integrity and good

governance in the local administration; and 5. Willingness to fruitfully cooperate with the local

administration

Responsibility of the Integrity Circles1. Serve as supervisory and partner bodies in the integrity and

good governance efforts of the local administration; and 2. Help improve the promotion of business and investment at

the pilot places by monitoring and supporting the efforts of the local administration.

3. Review the draft Integrity and Business and Investment Promotion Mechanisms designed by the LGU and external experts before a final version of these mechanisms are put into place; and

4. Regularly monitor and evaluate the implementation of the Integrity and Business and Investment Promotion Mechanisms.


Composition of LGU Integrity Circle

Atty. Mark C. Tolentino Provincial Administrator’s OfficeBenigno Christopher V. Lucero Provincial Planning and Development OfficePeter A. Polestico Provincial Planning and Development OfficeRocelyn T. Zosa Provincial Social Welfare and DevelopmentJone Siegfred L. Sepe Provincial General Services OfficeEmmanuel G. Guial Provincial Treasurer’s OfficeBenjamin Joseph C. Yap Cebu Investment and Promotions Office

Composition of Business Sector Integrity Circle

Perry Fajardo Cebu Business ClubFred Escalona PhilExport-CebuLeonardo Toledo Rotary Club of CebuRosemel Calderon European Chamber of Commerce and IndustryMarlene Bedia Mandaue Chamber of Commerce and IndustryMay Elizabeth S. Ybanez Cebu Chamber of Commerce and IndustryJose Mateo Metalworking Industries Association of the

PhilippinesVanessa Ybanez Cebu Furniture Industries Foundation, Inc.Gina Yosores Cebu Fashion Accessories Manufacturers and

ExportersJefferson Phil Tan Wellmade Motors and Development Corp.


Composition of CSD Integirty Circle

Thelma Choing Cebu Women’s NetworkJean Nica Bacaling ECSEMCOMargaret Ann Gravador Ramon Aboitiz Foundation, Inc.Leny Maramara Eversley Child SanitariumAlma Baoc Happy Horizons Children’s RanchCatherine Ruiz Kaabag sa Sugbo FoundationVirginia Santiago Legal Alternative for Women Center, Inc.

Technical Working GroupA technical working group at the pilot LGUs is constituted

from select LGU personnel to draft the design for integrity mechanisms and models for transparent, efficient and effective small business and investment promotion adapted to the respective contexts of the LGUs. The output of the TWG will be presented to the Integrity Consortium – composed of selected LGU representatives, business representatives and civil society representatives in the LGU, Civil Society and Business Circles – for their review and inputs. A final draft validated by the Integrity Consortium is sent for final review of the Project I4J Team, and final approval of the Local Chief Executive for implementation.


Composition of Technical Working Group

Rusty John Y. Abello Provincial General Services OfficeChona Christine G. Cobarde Provincial Assessor’s OfficeCeferino R. Faunillan, Jr. Provincial Administrator’s OfficeJuly Anne C. Guibone Cebu Investment and Promotions OfficeTimi-Lou Q. Manalili Provincial Environment and Natural

Resources OfficeEdna T. Obeñita Provincial Treasurer’s OfficeHartini H. Salvia Public Employment Services Office

25

Integrity MechanismsResults of the external assessment activities conducted

through focused group discussions and in depth interviews with selected stakeholders show that although there are efforts from the Provincial Administration to institute integrity in its operations, there are still areas that can be improved. Among issues raised are the following:• the availability, reliability and integration of data,• the awareness of civil servants on the laws promoting

integrity and• the monitoring of law implementation and processes

promoting integrity. Specifically, in the case of the Provincial LGU, its supervision and monitoring role over municipal and component city LGUs remain to be unclear and underutilized.

During the Project I4J orientation seminar, there were suggestions coming from the civil servants which can be serve as one of the basic documents that can be considered in drafting the integrity mechanisms for the Province of Cebu. Also, the results of the Integrity Self-Assessment Tool (ISAT) developed by the project for the LGUs can serve as indicators for areas that need attention. The survey revealed the following concerns:


FOCUS AREA 1: Local Chief Executive• The LGU has an effort to cascade RA 3019 (Anti-graft and

Corrupt Practices Act), RA 6713 (Code of Conduct and Ethical Standards for Public Officials) and other relevant laws related to ethical practices.

FOCUS AREA 2: Dealing with Employees• The LGU has programs to educate and train employees on

ethical decision making.

FOCUS AREA 3: Dealing with the Public• The LGU has integrated the Civil Service Code of Conduct

in the formulation, monitoring and updating of the Comprehensive Development Plan.

• The LGU has clear written rules on receiving gifts from the public.

• The LGU actively solicits feedback from the public on the performance of its employees.

FOCUS AREA 4: Dealing with Business Partners• The LGU has clear written rules on receiving gifts from

suppliers and other third parties.• The LGU encourages suppliers to enter into integrity pacts.• The LGU has procedures to audit suppliers’ compliance to

integrity pacts.• The LGU engages procurement/logistics representatives

in the regular risk assessment process including the identification of fraud risk areas.

• The LGU has processes to regularly evaluate the effectiveness of integrity policies when dealing with suppliers and third parties.

27INTEGRITY MECHANISMS

• The LGU provides procurement officers/agents trainings on business ethics appropriate for their rank and responsibilities.

FOCUS AREA 5: Dealing with Fiscal Administration• The LGU engages finance and accounting employees in

regular risk assessment process.

FOCUS AREA 6: Dealing with Communities, Environment and other Key Stakeholders• The LGU has programs and mechanisms to inform

communities and stakeholders about rules on bribing and other unethical practices including sanctions and penalties in relation to committing unethical practices.

• The LGU has clear levels of authority and procedures when dealing with communities and key stakeholders on cases of unethical conduct.

Integrity ModelThe Integrity Model guides the direction of future actions

which can be taken to reshape the elements to strengthen the web and thereby promote, reinforce and consolidate the institutionalization of integrity. The model contains a set of mechanisms which could be in the form of:• Policies and procedures• Capacity building activities• Risk assessment• Documentation • Streamlining of procedures


• Good governance programs

Cebu’s Integrity Model consists of mechanisms and strategic interventions that needs implementation to improve organizational operations and strengthen good governance by promoting integrity, transparency and accountability in every aspect.

Strategic Priorities1. Improve customer service for all frontline service agencies

a. Adopt Officer-of-the-Day Policy in all officesb. Establishing a hotline number/email address for

client’s assistancec. Monitoring of Client Feedback Surveyd. Service with a HEART

The RA 9485 known as Anti-Red Tape Act of 2007 requires government agencies to adopt working schedules to serve clients even during lunch break and after regular working hours. Each office or agency shall establish a public assistance/complaints desk in all their offices. The adoption of Officer-of-the-Day Policy in every office ensures that all clients who are within their premises are attended to and served with utmost satisfaction. The Officer-of-the-Day has the following responsibilities:• Acts as the main point of contract for visitors and callers

including reception duties• Responsible for the day-to-day general administration of

the organization supporting the staff team.


Along with officer-of-the-day policy, offices should establish a hotline number to handle customer queries and complaints. By providing a hotline number or official email address, this provides more assistance to the clients. Easy communication in the office enables good relationship with the public thus greater trust with the services. Furthermore, all employees transacting with the public shall be provided with an official identification card which should be visibly worn during office hours. Proper identification of employees strengthens transparency and accountability for the services rendered.

A feedback mechanism shall be established in all agencies and shall be incorporated in their annual reports as well as suggestion boxes. Monitoring of client feedback ensures consistency in customer service and provides essential feedback on areas that needs to be improved. Through feedback mechanisms, quality of service will not be undermine and thus bring service to a higher level.

A genuine public service starts when an employee provides service with a HEART. This encompasses Honesty, Work Ethic, Accountability, Social Responsibility and Teamwork.• Honesty/ Pagkamatinud-anon – Being open and honest

in all dealings and maintaining the highest integrity at all times

• Work Ethic/ Kaligdong sa Panarbaho – Positive and productive approach towards work

• Accountability/ Tulubagon o Kaauhan – Taking ownership of our customers’ needs and being accountable for delivering friendly and professional service

• Social Responsibility/ Pagkabana – Duty of every individual to maintain balance between economy and the environment

• Teamwork/ Panaghiusa – Listening to and respecting


each other whilst working together to achieve mutually beneficial results

2. Installation of Information Board and Signagea. Establishment of bulletin boards b. Standardization of signage

Information boards provide latest information in the organization. However, it may seem ineffective when information boards are not place prominently. It is important that these information boards are placed strategically where all clients and employees can them. Communicating with the public about up-to-date information, new policies and announcement improves transparency and effective information dissemination.

Moreover, standardized signage should be institutionalized in order to effectively communicate and provide directions to the different locations in the building. Placing proper directional signage, floor plan directory conspicuously in the different areas provides easy navigation for clients and visitors in the building. With this, it boosts client satisfaction.

3. Standardization and Streamlining of Business Procedures in All Component LGUsa. Unified business registration proceduresb. Harmonization/Standardization of business

requirements and application formsc. Develop computerized/electronic business

registration in LGUs


One major drawback in business registration and investment promotion is the inefficient and complex procedures across the component local government units. The government has taken actions to deliver better business processes. Initiatives in making the business registration and renewal process as simple and efficient as possible continues to slow down due to different forms of corruption and unethical practices.

Long processes that are often accompanied by such inconveniences as long queues, uncomfortable office surroundings, or long distances between offices from which signatures are required, discourage business persons from registering. Simple business registration and renewal processes, which minimize steps and signatures, attract more businesses to register. These translate to more revenues for the LGU. These also result in better quality service in the eyes of the clients as well as those of other stakeholders.

Reducing the procedure is crucial in achieving a business-friendly environment for investors. It is essential that the current processes undergo thorough review to determine which steps and signatures are necessary, making as simple and short as possible through reduction in the process (e.g. steps, signatures and requirements).

By streamlining business procedures, this enables harmonization and standardization of business requirements and application forms in the component municipalities and cities of Cebu. Easing up of procedures provides clear and standard system. This encourages and attracts investors to register their businesses without availing services from fixers and using connections for speedy facilitation of processing.


Moreover, the introduction of information and communication technology (ICT) hardware and software applications in the BPL process provides more efficient approach to generating more business for the LGU. Enabling electronic forms reduces time and provides more convenience to the business people. Some LGUs have implemented electronic system to increased efficiency and delivery of services however, some have partially utilized the system causing slow processing and difficulties due to manual procedures.

4. Easy Facilitation of Investment Processesa. Establishing Green Lane for All Investorsb. Strengthening and Capacity-building of Cebu

Investment and Promotions Office

To expedite the applications for setting up investment projects, Cebu will established a Green Lane for all investors in Cebu. Signing of a Memorandum of Agreement (MOA) between key agencies would further enhance frontline services to existing investors and prospective investors in the province. There is already an initiative that licensing of investors will now be in the Green Lane unit that caters to registration of corporations and partnerships, including subsidiaries of foreign corporations wherein in one day they would expect approval. With the Cebu Investment Assistance Network (CIAN), establishing Green Lane and inter-agency networking for investment promotion is a fundamental step in enhance the business and investment climate in Cebu.

The Cebu Provincial Government has created the Investment and Promotions Office to strengthen and sustain Cebu’s attractiveness to global investors. Established last November 2014, the office lacks personnel to handle different functions of the office and logistics support. The responsibility is a daunting


task however CIPO aims to build an integrated information database for investors and businesses as well as a one-stop-shop for domestic and local investors. However, in order to implement the strategies mentioned above, it is important to build capacity to design specific action plans and skills to set up a system to realize these plans. Training workshops and consultation with key industry experts will be highly beneficial for the organization. It is through these capacity-building activities that strategic objectives for nation-wide promotion for investments can be set up and operated.

5. Increasing Transparency and Accountability of Financial Releasesa. Creation of an Independent Internal Control Office

The Cebu Provincial Government has been releasing funds to the LGUs in accordance with Section 287 of the Local Government Code requiring LGUs to appropriate in its annual budget no less than twenty percent (20%) of the Annual Internal Revenue Allotment for development projects. It may be utilized to finance the priority development projects and programs as embodied in the duly approved local development plan that directly support the Philippine Development Plan and the Medium-Term Public Investment Program. All projects to be funded shall contribute to the attainment of desirable socio-economic development and environmental management outcomes and shall partake the nature of investment or capital expenditures.

Government auditing is an analytical, systematic examination and verification of financial transactions, operation, accounts and reports of any government offices for the purpose of determining their accuracy and authenticity and satisfying the requirements of law rules and regulations. By this definition, we


are not certain if these releases has been properly implemented according to plan and specification. Though the pre-audit exists, it does mathematical pre-audit but not the normal internal audit and do not carry full blown internal audit in the field.

Having this in mind, Cebu Province would like to strengthen the monitoring system of the implementation of the Financial Assistance and Cash Advances by creating an Independent Internal Control Office who will oversee the operations audit and monitor the proper implementation of the projects. The purpose for the creation of the Independent Internal Control Office is to identify the strength and weaknesses of the implementation of Financial Assistance/Cash Advance by benchmarking its processes to the institutional standards for the professional practice of internal control.

The Independent Internal Control Office should clarify with LGU the internal audit activity and build rapport to ensure that those at the top should have a clear picture of the internal audit functions. The opportunity is to learn about management views as to the greatest risks of the organizations. The Internal Control Office should:• Discuss with stakeholders on the audit findings which may

have identified during the audits.• Benchmark the audit against the criteria for an effective

internal audit organization and assists in identifying gaps in the current organization’s policies and procedures.

• The Internal Control Office working closely with accounting should map the major processes/operations within the organization. Meet with chief executive including heads of offices in order to understand the risks and concerns that would cover the following: (a) a risk assessment for the organization; (b) a risk based audit methodology, and (c) audit plan.


• The Internal Control should benchmark the internal control framework using the Guidelines on Internal Control Standards for effective internal control.

6. Information, Education and Communicationa. Strengthen existing ICT infrastructureb. Capacity building for PIO and ICT Officec. Information Campaigns

The Provincial Information Office (PIO) of the Cebu Provincial Government is primarily responsible in providing relevant, adequate and timely information to all stakeholders. The office is the forefront in providing up-to-date information especially during and aftermath of calamities and disasters in the province of Cebu. The office disseminates information to newspapers and media organizations on the provincial government’s policies, programmes, initiatives and achievements. It functions as an interface between the government and the media and communicates through press releases, feature articles, photographs and other information made public on their website and other social media sites.

Communicating important information about the policies and programmes of the government increases public awareness of the government’s initiatives. The rise of social networking sites gives citizens, organizations and other government units more opportunities to communicate and discuss issues openly on a large scale. With the internet, it becomes easier for people to access more information yet there are challenges in the structure and organization to successfully support the function of the office.

By strengthening its Information and Communications Technology (ICT) infrastructure, the Office can meet the current and future challenge and do their roles efficiently and effectively.


Along with this, capacity-building activities must also be included to the ICT and PIO employees. Such initiatives will build the capacity of the PIO to share and disseminate information at their local, practical information and prediction services in the effective communication sector for improved decision making and better arrangements of the services. Information officers must be provided access to computer facility and networks, and adequate training in the use of computers and information systems for retrieval of information may also be provided to them.

In addition, a series of multimedia information campaigns will be established to fast track the development of the Cebu Province. The information campaigns will • disseminate the correct information about the on-going

development projects of the Province;• increase public awareness• generate support (financial and resource) from the private

and public sectors for the development projects.

7. Continuous Monitoring of the Procurement Activities of Bids and Awards Committeea. Application of Standard Time and Cost to Benchmark

Procurement Activitiesb. Adoption of Pricing Standards and Utilization of

Scorecards

The Bids and Awards Committee (BAC) aims to have an efficient and effective delivery of basic service through a compliant procurement process and a commitment to adhere the principles of government procurement. The BAC also aims:• To provide efficient, transparent and compliant procurement

process within the specified period of time


• To identify strengths and weaknesses of the procurement system and develop action plan for procurement improvement to address the areas of risks and weaknesses

• To comply with Government Procurement Policy Board’s (GPPB) Agency Procurement Compliance and Performance Indicators (APCPI) requirements and other government agencies that require procurement monitoring reports

The GPPB adopted the use of Agency Procurement Compliance and Performance Indicators (APCPI) System on 2012 as the standard procurement monitoring, assessment and evaluation tool which aim to determine, in a qualitative and quantitative manner, procurement strengths and weaknesses of agencies, and formulate a reasonable action plan to address identified areas for improvement while adopting measures to sustain strengths alongside a competitive, transparent, economical, efficient and accountable public procurement regime.

8. Collection of Taxes, Fees and surchargesa. Strengthen tax campaignsb. Improved tax collection

There are many responsibilities of a state to its citizenry. State is represented by the government. Hence, the government of a country performs a number of activities in order to maintain law and order, peace and security, satisfying with the requirement of basic needs and public utilities or services, including various development programs. In order to carry out all these activities and discharge its overall responsibilities towards the people, it needs sufficient revenue. Government revenue is collected through various sources according to the provisions of the financial acts and rules and regulations. Such sources of revenue are taxes, fees and charges, fines and penalties, grants etc.


The fundamental purpose of taxation is to finance government expenditure. Beyond this primary purpose, modern collection systems are also guided by principles of efficiency, equity and simplicity. The effectiveness of any government depends on the willingness of the people governed to surrender or exchange a measure of control over their persons and property in return for protection and other services. Taxation, including fees and charges, is one form of this exchange.

With the aim of raising revenues, as a medium of exchange with the taxpayers on its needed goods and services, it is then likewise proper to propagate on how taxpayer’s money is being used by the state. With this, we can convey to the people the reason of tax payment. Conducting an extensive information campaign to raise awareness of the need to pay taxes and the services received for taxpayer’s money is easily transferrable into different contexts. At the same time, to achieve impact among the population and raise visibility, the messages used must be context-specific and relevant for the audiences. Thus, the contents of the campaign must consider the local context where it is implemented.

More so, tax campaigns can raise understanding that payment of taxes enables the state to function and provide social guarantees to its citizens, instead of looking at it as a burden. An increased awareness would also result in an improved tax behaviour and readiness to pay taxes voluntarily. Having the taxpayers awareness will build the trust on the institution (government), there being one with the community as to its purpose and success.


9. Dataintegrationoffinancialrecordsa. Linkage of external records with 44 municipalitiesb. Information exchange network with PAC, PTO, PAS,

PBO

Data integration of financial records is where different data from finance offices like Budget, Accounting, Treasury and Assessor’s are incorporated altogether to form and serve as a whole. This reduces the possibility of duplicating data gathering efforts and its availability and accessibility are already known to be possible.

As financial data or information are considered to be one that demands accuracy and uniformity, it is just but right to have these data integrated, as these offices will be talking the same page, there having a unified view of the data.

Moreover, the tracking system of the financial transactions will be improved and more responsive, resulting to better client relationship and services. This will likewise manifest transparency, reflecting thereby the image of the institution.

As integration of financial data would entail linkage of records and information exchange network with, between and among financial offices, procedures are to be adopted in order to attain its success. This course of action involves extraction, transformation and loading of data or information. As mentioned earlier, financial data requires accuracy whenever it is already made available and accessible to the concerns. Hence, collection and selection of necessary data is vital in the determination of the needs of the network offices. Moreover, these data require validation, including rejection, if not acceptable and necessary, conversion, clearing the duplicates, standardizing, filtering, sorting and translating or verifying, before it shall be finally imported into a database. In this manner, the correctness of the


data or information shared between and among network offices is established and can be relied on.

10. Improve the recognition and incentives system a. Monitoring of performance: employee, department/

unitsb. On-time submission of accomplishment reports

As observed by the present national administration, good performers in government received little to no recognition for their hard work. Majority of them receive as much bonuses as their co-workers who underperform or do not take responsibility for their tasks. This prompted the Aquino administration to implement a Performance-Based Incentive System which seeks to foster a culture of fairness and excellence in the bureaucracy, where good work is duly recognized, while poor output goes unrewarded.

Under the status quo, bonuses are given uniformly to all civil servants, regardless of their performance. In some cases, this incentive system has been abused. As a remedy, the Aquino administration sought to introduce a new system that will focus on service delivery and reward the best in the bureau through incentives that correspond with the performance of employees and their offices. Thus, the establishment of a Performance-Based Incentive System (PBIS).

The present administration believes that having definite rewards for exemplary work can inspire public servants to perform better. This can even motivate their co-workers in their own units to perform well, too. Such system is designed to encourage improved performance and better accountability, in line with ensuring the accomplishment of the Administration’s development agenda.


Benchmarking from the national government’s aim to foster a culture of fairness and excellence in the bureaucracy, where good work is duly recognized, the Cebu Provincial Government adopts a fair and transparent incentives system.

Recognizing the vital role of rewards and incentives system in producing concrete and visible improvement in the delivery of goods and services to the public, this strengthened incentive system will encourage employees to be productive and creative in mobilizing their capacities parallel to the accomplishment of their department/unit’s target performance.

The (committee in-charge of the PBIS implementation) develops clear guidelines in recognizing exemplary performance of employees and departments/units. Consistent to the present administration’s emphasis on good governance, accountability and transparency. The (committee in-charge of the PBIS implementation) should:• Coordinate with the performance management team

(PMT) in identifying top performers in the Cebu Provincial Government.

• Ensure that rewards and incentives are awarded based on performance and accomplishment.

• Encourage reinforcement of non-monetary incentives


SPECIFIC ACTIVITIES TIMEFRAME RESPONSIBILITY CENTER

EXPECTED RESULTS MEANS OF VERIFICATION

BUDGET/PROJECTED COST

Adopt Officer-of-the-Day Policy in all offices

On going PAD/HRMO Increased satisfaction in Client Feedback Survey; Job Description/ Responsibilities of Officer-of-the-Day

Established public assistance and complaints desk with a presence of Officer-of-the-Day

P 70,000.00 (materials for the improvement of the existing information counter)

Establishing a hotline number/email address for client’s assistance

Within the year CIPO, PENRO, PTO, PAS, HRMO, PESO

Improved public assistance and handle public complaints effectively

Installation/provision of accessible public hotline number/ official email address

P 60,000.00 (telephone landline service)

Monitoring of Client Feedback Survey

On going PAD/HRMO Functional feedback mechanism

Provision of Suggestion box; Client Satisfaction Survey to be included in monthly accomplishment reports

P 6,000.00 (suggestion boxes for 6 offices)

Service with a HEART On going CIPO, PENRO, PTO, PAS, HRMO, PESO

Increased satisfaction in Client Feedback Survey; Improved service delivery

Positive Increase in Client Feedback Survey

P 1,200,000.00 (training cost)

Establishment of bulletin boards

On going PAD/PGSO Public have easy access to information (e.g. news, announcements)

Existence of information boards highly noticeable to the public

P 10,000.00

Standardization of signage

On going PGSO Signage in conformance to international standards

Uniformity of signage and posters in all departments

P 50,000





Adopt Officer-of-the-Day Policy in all offices

On going PAD/HRMO Increased satisfaction in Client Feedback Survey; Job Description/ Responsibilities of Officer-of-the-Day

Established public assistance and complaints desk with a presence of Officer-of-the-Day

P 70,000.00 (materials for the improvement of the existing information counter)

Establishing a hotline number/email address for client’s assistance

Within the year CIPO, PENRO, PTO, PAS, HRMO, PESO

Improved public assistance and handle public complaints effectively

Installation/provision of accessible public hotline number/ official email address

P 60,000.00 (telephone landline service)

Monitoring of Client Feedback Survey

On going PAD/HRMO Functional feedback mechanism

Provision of Suggestion box; Client Satisfaction Survey to be included in monthly accomplishment reports

P 6,000.00 (suggestion boxes for 6 offices)

Service with a HEART On going CIPO, PENRO, PTO, PAS, HRMO, PESO

Increased satisfaction in Client Feedback Survey; Improved service delivery

Positive Increase in Client Feedback Survey

P 1,200,000.00 (training cost)

Establishment of bulletin boards

On going PAD/PGSO Public have easy access to information (e.g. news, announcements)

Existence of information boards highly noticeable to the public

P 10,000.00

Standardization of signage

On going PGSO Signage in conformance to international standards

Uniformity of signage and posters in all departments

P 50,000





Unified business registration procedures

Within the year CIPO Harmonized business procedures

MOA with 44 municipalities and 7 component cities

P 250,000.00 (conduct of consultation workshops/meetings and transportation)

Harmonization/Standardization of business application forms

Within the year CIPO Standardized business forms

Develop computerized/electronic business registration in LGUs

Within the year CIPO Improved business registration

Establishing Green Lane for All Investors

Within the year CIPO Fast and easy investment processes

MOA with other key agencies

P 100,000.00 (conduct of meetings, meals etc.)

Strengthening and Capacity-building of Cebu Investment and Promotions Office

Within the year CIPO Knowledgeable and skilled investment and promotions employees

Calendar of activities for training and capacity-building

P 300,00.00 (meals, snacks, transportation, training kits)

Creation of an Independent Internal Control Office

Within the year PAD (Systems Audit), PPDO

Creation of Internal Control Office, Copy of Provincial Ordinance

P 4,000,000.00 (creation of a new department)

Strengthen existing ICT infrastructure

Within the year IT Improved Communication System

New systems and equipment

P 15,369,300.00 (new hardware, systems, equipment)

Capacity building for PIO and ICT Office

Within the year PIO & IT Calendar of activities for training and capacity-building

P 350,00.00 (meals, snacks, transportation, traning kits)

Information Campaignsa. Tourism Information

Campaigns

Within the year PIO No. of information campaigns disseminated

P 320,000.00 (marketing collaterals, outsourced labor)





Benchmarking of standard time and cost

On-going BAC/PGSO Transparent and efficient procurement process

Pricing Standards/Information Database/ Scorecards

P 1,500,00.00

Strengthen Tax Campaigns

On-going PTO Improved Tax Collection No. of Tax Campaigns P 200,000.00 (fuel, materials)

Linkage of external records with 44 municipalities

On-going PAS, IT Improved communication and information exchange

Centralized database and the 44 municipalities are already

P 844,000.00 (hardware equipment)

Information exchange network with PAC, PTO, PBO and PAS

Within the year PAC, PTO, PBO, PAS, IT

Monitoring of Performancea. Employeeb. Departments/Units

On-going HRMO, PAD (through Department Heads)

Improved Productivity of Employees

Performance Indicators and Matrix System

P 2,000,000.00 (every year)


For comments, questions and suggestions, contact:

“Partnerships for Integrity and Jobs” (Project I4J)Coordination OfficeKonrad-Adenauer-Stiftung5/F Cambridge Center,108 Tordesillas cor. Gallardo Sts.,Salcedo Village, Makati City1227 Philippines

Phone: (632) 819 7530Fax: (632) 893 6198

Website: www.euprojecti4j.com

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