A Chief Justice’s Point of View: Federalism and the Philippines

Federalism is not a magic bullet that will put to rest all the problems of our people rather it is a vehicle to achieve the aspiration of our people. –Former Chief Justice Reynato Puno

Former Chief Justice Reynato Puno is in his Keynote speech in front of members of the ECOP, MBC, MAP PCCI April 24, 2017, expressed that it is crucial to get the slippery slopes of the process right for a successful shift to Federalism.

He says, we should restructure our government with care and circumspect. He finds that the root cause of the Moro issue is lack of representation in the Senate. Hence, in the new Constitution, there must be a Connecticut compromise wherein all states must be equally represented in the Senate.

Second, policy wise, we should have a central government that decisively acts. The central government must be strong but the challenge is creating such without trampling on the power of constituent states.

With regard to the division of power, aside from the need to determine which powers are exclusive to central government and shared with the states. Former Chief Justice Puno has two suggestions: reserve powers or those powers not enumerated should be given to the central government; and the central government should also be given the power to override constituent states during emergency cases.

Importantly, in forming the constituent states, a political and economic standard must be used. He advises that it must be done with extreme caution and prudence as it will spell survival or failure of the states. He suggests the following standards: fiscal capacity, physical contiguity, ethnic, language and cultural, taking into account economic, human development, labor productivity and ethno-cultural peculiarities.

He also stresses that there is a need to configure asymmetric treatment of minorities: Muslims and Indigenous Peoples. Under the new system of government, these minorities would be given the right to self-rule. However, the challenge, he says is how to slice the territory to prop them up to stand as states with their own prerogatives.    

Finally, he proposes the creation of three to four states. He also recommends two ways to make the states fiscally viable. One, fiscal transfers through loan or grants whether conditional and unconditional. Two, the use of revenue sharing where an intergovernmental agency oversees the funds to ensure its proper use.

The Panel
The issues raised by the three-member panel were diverse.  Corazon S. De La Paz- Bernardo of the Makati Business Club, focused on concerns surrounding businesses. She posits that there is lack of information on how Federalism would affect the rules governing business, trade and investment as well as the question on how economic progress would be disrupted. Dindo Manhit of Stratbase, shared his apprehension asking if the country is really ready for Federalism. He is also uneasy with the idea that political dynasties could create private kingdoms through Federalism.  He opines that federalists should look for a system where there is true responsibility and accountability of public officials. The focus after all, is the desire to attract jobs/employment and direct foreign investments. Lastly, Perry Pe, a Senior Partner Romulo Mabanta, believes that Federalism would disperse the money to the countryside or provinces. Based on jurisprudence, the unitary system hinders the countryside/provinces from reaping the benefits and direct investments situated in their area.

Look to the past, Former Chief Justice Puno says, history has the answers. He suggests that everyone should study the history of federal governments and their constitutions as most questions have or apprehensions have already been experienced and solved by these countries. Nonetheless, the questions raised by the esteemed panel illustrates the worry or anxiety in the business sector due to lack of information on Federalism and how it would affect business. He reminds though, federalism is not a magic bullet that will put to rest all the problems of our people rather it is a vehicle to achieve the aspiration of our people. A process that should be bound by time.


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