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LGU Special Education Fund underutilized, inequitable – EDCOM 2


The Second Congressional Commission on Education (EDCOM 2) underscored its findings that the Special Education Fund (SEF) of local government units (LGUs) around the country remain underutilized, despite an increase in income, in a technical working group meeting on the 21st Century School Boards Act and Expanding Special Education Fund by the Senate Committee on Local Government, held jointly with Committees on Basic Education and Finance. 

“We need to ensure that the SEF can be fully utilized especially because LGUs need additional support for education. Since procurement issues and limitations on the use of the SEF have been among the reasons for its underutilization, it is crucial that we give LGUs the flexibility to use their available resources for their education needs,” said Gatchalian, author of the 21st Century School Boards Act (Senate Bill No. 155). 

Aside from expanding the use of the SEF, Gatchalian’s proposed measure seeks to strengthen LGU involvement in improving the quality of education. 

In its Year One Report entitled Miseducation: The Failed System of Philippine Education, one of the findings identified by the Commission is that “there is a marked disparity in SEF income among different types of local government units”. The Commission noted that the median SEF income of municipalities is only 4% of that of cities and provinces. Meanwhile, first class municipalities have SEF incomes 68 times more than their sixth class counterparts. 

SEF utilization remains low, accountability in monitoring is unclear

Based on analysis by EDCOM, between 2018 and 2022, SEF underutilization amounted to P15 billion in 2022. Underutilization is highest in cities (57%). “Despite this, and the presence of two policies on reporting of SEF expenditures, who is accountable in reporting these figures, and in working with LGUs to ensure that they are spent?”. 

Yee highlighted that there are two policies currently governing this: the DepEd-DBM-DILG Joint Memorandum Circular No. 1, s. 2017 tasks the Local Accountant to submit quarterly and annual reports of the SEF, while the DOF Department Order No. 8-2011 tasked the Department’s Bureau of Local Government Finance (BLGF) to maintain the Electronic Statement of Receipts and Expenditures (eSRE) as the official reporting system of the DOF on local government finances. “Oversight in and accountability for the effective utilization of SEF must be clearly established and strengthened”, he continued. 

Addressing inequity in access to resources

Dr. Yee also underscored the need for equity provision to ensure sufficient resources for lower income class municipalities – especially for laws that charge mostly or solely to the SEF, such as early childhood care and development (RA 10410 or the Early Years Act), nutrition (RA 110371 or the Masustansiyang Pagkain Para sa Batang Pilipino Act), and Alternative Learning System (RA 11510 or ALS Act), which expanded the SEF’s purpose beyond its original supplementary function. 

The EDCOM Year One Report highlighted the severe discrepancies in access to resources. Data shows that the median SEF income of municipalities is at Php 1.6 million, or 4% of the median SEF income of cities and provinces. Meanwhile, first class municipalities have SEF income 68 times more than their sixth class peers.

“It is critical that as we review the law governing the Special Education Fund, that we address significant inequities in access that are faced by low-income municipalities,” said Executive Director Yee. “For example, we should consider funds that could be accessed by poorer LGUs, clarifying the framework, responsibilities, and resource allocations between provincial and municipal local school boards, and also clarifying how these funds complement DepEd allocations.”

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