No region left behind under federal setup–Alvarez

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House Speaker Pantaleon Alvarez. (Facebook grab)

SPEAKER Pantaleon Alvarez on Tuesday said no region or state would be left behind under a federal system of government.

In an ambush interview, Alvarez said a formula could be adopted in creating the regions or states under a federal setup to ensure every region would have adequate potential and resources for development.

Concerns were raised that poorer regions may be left out after the Department of Finance (DOF) provided data to the House Committee on Constitutional Amendments showing that aside from the National Capital Region, Region VI-A and Region II, the rest of the country’s regions are largely dependent on their IRA (Internal Revenue Allotment) share.

“May formula kasi doon, yung mga regions na talagang mahirap pwede natin yang isama doon sa region ng mayaman para kaya silang buhatin nung region na yun,” Alvarez said.

For instance, Alvarez said, the relatively poor CARAGA region and the prosperous Davao region could be grouped together as a state. Likewise, he said the poor areas of Region VIII may be grouped with the more economically strong Region 7.

“Tulungan lang,” Alvarez pointed out.

Alvarez also said that a Special Equalization Fund may be established by the federal government, similar to the system in Malaysia, to assist “poor” or less developed component states and enable them to catch up with economically advanced ones until they are able to stand on their own.

“Sa ibang bansa like Malaysia may tinatawag silang Special Equalization Fund para doon sa halimbawa nahihirapan yung isang region sinu-subsidize nila hanggang makabangon talaga,” Alvares said.

Alvarez said that under the federal setup envisioned by the administration, the IRA would likely be scrapped but replaced by a revenue-sharing arrangement where the lion’s share would go to the component states.

“Tingin ko wala nang IRA yan, dahil 80 -85 percent nung income mo maiiwan na sa iyo. Sobra-sobra na yun kung i-compute mo sa IRA mo yan, di ba? Kailangan lang talaga magsipag yung region na yun,” Alvarez pointed out.

However, Alvarez said it was up to the framers of the new federal constitution to determine the final revenue-sharing ratio between the states and the federal government.

What is more important, according to Alvarez, is that the federal system of government will help unleash the development potential of the regions.

“Nakikita ko, every region in this country may mga potential, ang laki. Ang laki ng potential. Kaya lang sila hindi nakakausad dahil nga, like for instance sa Caraga, sinong nakikinabang doon sa mga minerals nila? It’s the National Capital Region, hindi sila. Magkano lang yung nakukuha nilang shares doon sa mga minerals na mini-mina doon sa area nila? Napakaliit,” Alvarez said.

Alvarez said that under the concept of federalism, there would be healthy competition among the regions or states and they were free to adopt economic policies to attract investors.

For instance, Alvarez noted that Bicol Region and Region VIII were currently producing cheap electricity from their geothermal resources but their people remain saddled with high electricity prices.

He said the power produced in these regions was sent first to satisfy the demand in the National Capital Region before the excess was returned for local use, subjecting the power rates to double charges of system loss.

Under a federal setup, Alvarez said these regions could offer lower power rates to entice more investors to relocate their business operations in these areas.

“Syempre, pagka ganun maraming mga industries na lilipat doon, maglo-locate sa region nila dahil mababa yung kuryente. Now you create economic activities, now you create jobs, now you generate business, now you create opportunities. Now, they can chart their own destinies—yun ang kagandahan doon,” Alvarez said. p: wjg

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