Federalism concerns ‘not insurmountable’: Palace

Although the President is the foremost proponent of Charter change towards federalism, Roque said he wants it done in a manner that will not “put the country in trouble.” (PNA photo)

MANILA — President Rodrigo R. Duterte is “aware”of concerns of both his economic managers and business groups that a shift to federalism would be risky but noted that these concerns were “not insurmountable.”

Earlier, Philippine economic managers urged lawmakers to carefully review the proposed shift to a federal system of government.

Department of Finance (DOF) Secretary Carlos Dominguez III earlier said he found the fiscal provisions in the draft federal Constitution as confusing and sought for clarification on revenue and expenditure assignments.

National Economic Development Authority (NEDA) Secretary Ernesto Pernia also said the shift might be too costly and may disrupt economic momentum.

At least seven business groups, in a joint statement, echoed concerns of the economic experts about “ambiguous provisions” on the division of revenue and expenditure responsibilities between federal government and its federated regions.

These groups include Cebu Business Club, Employers Confederation of the Philippines, Financial Executives Institute of the Philippines, Makati Business Club, Management Association of the Philippines, Philippine Chamber of Commerce and Industry Inc., and Philippine Exporters Confederation Inc.

“He is now aware of this concern. And he has said that it is not insurmountable,” Presidential Spokesperson Harry Roque told a Palace briefing.

Roque said Duterte has been listening to all inputs and is “looking for solutions.

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Although the President is the foremost proponent of Charter change towards federalism, Roque said he wants it done in a manner that will not “put the country in trouble.”

“That’s why he is exploring now all options and has ordered that everyone should study it,” Roque said.

Roqe said Duterte is asking members of the Congress to look into the matter very seriously because ultimately, it is Congress that will submit to the people the proposals.

“Pupuwede naman po iyan pag-aralan at hanapan ng solusyon. Hindi naman po complete na balakid iyan para sa Charter change (It can be studied and we can find solutions. It’s not a complete obstacle to Charter change),” Roque said.

Roque reiterated that discussions on federalism are always welcome from everyone.

“We want this kind of discussion. We want people to think deeply about the ramifications.

And we welcome all sorts of inputs from all members of society,” Roque said.

“So this is, of course, an input that the President will consider. And we’re hoping that the legislatures who will tackle Charter change will also consider the position of the business community,” he added.

The Consultative Committee (ConCom), which drafted the federal constitution, earlier allayed fears of the economic managers, noting “the fiscal administration is quite clear in the draft Constitution.”

ConCom spokesperson Ding Generoso said under the ConCom’s draft federal charter, the federal (national) government retains the taxation power, except for selected taxes and fees wherein the collection of which will be transferred to the regional governments.

Sharing of the collections from top four sources of revenues shall be 50 percent for the federal government and 50 percent for the regional governments, he said.

Internal revenue allotment will no longer be a concern of the federal government since the power to distribute the shares of local government units will belong to the regional government, he added.