Promoting E-Govt in the Context Of New Public Management - Mirandilla (Dec 5 08)


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A USAID-funded e-government project on digital land titling initiated in Cebu, which features a promising multi-stakeholder and market-driven approach.

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  • Promoting E-Govt in the Context Of New Public Management - Mirandilla (Dec 5 08)

    1. 1. Promoting e-Government in the context of New Public Management: The Case of the Cebu City Government in the Philippines Mary Grace P. Mirandilla CPR south 3, BUPT, Beijing, China December 5-7, 2008
    2. 2. New Public Management <ul><li>Public sector reform approach </li></ul><ul><ul><li>introduce or simulate performance incentives and disciplines found in market environment </li></ul></ul><ul><li>Main drivers : </li></ul><ul><ul><li>autonomy and accountability of public managers </li></ul></ul><ul><ul><li>decentralized control; variety of alternative service delivery mechanisms </li></ul></ul><ul><ul><li>competition; incentives </li></ul></ul><ul><ul><li>increased efficiency; client- and results-driven </li></ul></ul>
    3. 3. Local Gov’t & Real Property <ul><li>Real Property Taxation (RPT) </li></ul><ul><ul><li>Revenue-raising power of LGUs </li></ul></ul><ul><ul><li>administration, appraisal, assessment, levy and collection of real property taxes </li></ul></ul><ul><ul><li>major source of revenue but declining in trend (%) </li></ul></ul><ul><li>Many commercial transactions premised on titled property, BUT land administration inefficient and problematic </li></ul>Year All LGUs Provinces Cities 1989-1991 58.2 54.4 63.1 1992-2000 55.4 49.0 59.7
    4. 4. Uncertain Property Rights <ul><li>Only 20% of privately owned land “registered,” some rely on deeds; most rely on informal systems </li></ul><ul><li>10 million registered titles, but… </li></ul><ul><ul><li>about 6% remains unclassified </li></ul></ul><ul><ul><li>duplicate and overlapping titles </li></ul></ul><ul><li>Reliable or not, LAND used as collateral for bank loans and investment! </li></ul><ul><li>Private sector engineered “work-arounds” but… </li></ul><ul><ul><li>Poor system encourages tax delinquencies and non-compliance, erodes credibility, and increases cost! </li></ul></ul>
    5. 5. “ What are we trying to solve?” <ul><li>Getting bank loan with land as collateral involves… </li></ul><ul><ul><li>Verification of Land Title </li></ul></ul><ul><ul><li>Tax Declaration </li></ul></ul><ul><ul><li>Tax Clearance </li></ul></ul><ul><li>… several not-so-easy steps: </li></ul><ul><ul><li>Verification of Land Title – 6 steps </li></ul></ul><ul><ul><li>Tax Declaration – 4 steps </li></ul></ul><ul><ul><li>Tax Clearance – 7 steps </li></ul></ul>
    6. 6. Verification – Cebu City RoD <ul><li>Get an application form from a Register of Deeds clerk </li></ul><ul><li>Proceed to the vault keeper – Vault keeper, together with two assistants/ helpers, looks for the title. Once found, title is photocopied. </li></ul><ul><li>Recording - Transaction is recorded by the records officer </li></ul><ul><li>Certification of title – Certified copy is duly signed and certified by the Register of Deeds records officer </li></ul><ul><li>Pay cashier – Photocopying and </li></ul><ul><li>Certification fees </li></ul><ul><li>Release of Certification from RoD </li></ul>
    7. 7. Verification - Cost Costs Photocopying = $ 4 cents/page (titles usually have 4 pages) Verification fee = $ 0.27 Certification fee = $ 0.80 TOTAL = $1.24 Personnel 1 Clerk (receives applications) 1 Vault keeper 2 Helpers 1 Records Officer (concurrently admin officer) 1 cashier (same for all transactions) TOTAL = 6 personnel (total City RoD personnel: 22) Average number of verifications 40-50/day Average Length of Time per transaction If all in order : 20 minutes If not all in order: 3 days to 1 week
    8. 8. Tax Declaration – Cebu City Hall <ul><li>Get an application form from the counter (tax assessor on 2 nd level of city hall) </li></ul><ul><li>Pay cashier (ground level of city hall) </li></ul><ul><li>Get signatures of the following: </li></ul><ul><ul><li>Administrative Officer </li></ul></ul><ul><ul><li>Chief of the Building and Machinery Division of the specific district the building is located (if living in a building); Chief of the Land Division of the specific district the property where is located (Cebu City has 80 barangay or villages separated into districts) </li></ul></ul><ul><ul><li>City Assessor </li></ul></ul><ul><li>Get Documentary Stamp </li></ul>
    9. 9. Tax Declaration - Cost Costs Documentary Stamp = $ 0.44 Tax Declaration fee = $ 0.67 Total = $1.10 Personnel 1 Clerk (receives applications) 1 Cashier 3 Signatories Average number of verifications 40/day , sometimes 70/day if tax declarations involve subdivisions Average Length of Time per transaction For single property (certified true copy): 30 minutes For all properties in a subdivision : 3 days max. For an owner with many properties: 3 days max.
    10. 10. Tax Clearance – Cebu City Hall <ul><li>Bring tax declaration/ tax receipt of property </li></ul><ul><li>Verification of the tax declaration at the verification section (1st Floor City Hall) – print-out to be generated </li></ul><ul><li>Computation of Taxes to be paid (if not yet fully paid) </li></ul><ul><li>If there are: </li></ul><ul><ul><ul><li>No payables – proceed to step # 5 </li></ul></ul></ul><ul><ul><ul><li>With payables – payment to be made at the cashier first, then proceed to step # 5 </li></ul></ul></ul><ul><li>Proceed to Miscellaneous Window for Tax Clearance payment </li></ul><ul><li>Proceed to Tax Clearance Section for issuance </li></ul><ul><li>Get Documentary Stamp </li></ul>
    11. 11. Tax Clearance - Cost Costs Documentary Stamp = $ 0.44 Tax Clearance fee = $ 0.67 Total = $1.10 Personnel 1 Clerk (receives applications) 1 Cashier Average number of verifications 100/day Average Length of Time per transaction If taxes are already fully paid : 30 minutes If taxes are not yet fully paid : 1 hour
    12. 12. Problems and Issues <ul><li>Manual system prone to human error and corruption </li></ul><ul><ul><li>Handling of records and titles have resulted to loss </li></ul></ul><ul><ul><li>A vault keeper earns US$189 per month, including allowances </li></ul></ul><ul><ul><li>Tampering of entries in a certificate of title very likely </li></ul></ul><ul><li>Worn out titles due to poor storage facilities and exposure to humidity </li></ul><ul><li>Index card filing system inefficient, </li></ul><ul><li>prone to wear and tear </li></ul><ul><li>Workflow process moves from </li></ul><ul><li>one step to the next on a </li></ul><ul><li>“ per-transaction” basis </li></ul>
    13. 13. Electronic Land Market Project <ul><li>Proponents </li></ul><ul><ul><li>USAID (funding source) </li></ul></ul><ul><ul><li>TAF (management) </li></ul></ul><ul><ul><li>ADMU (research and coordination) </li></ul></ul><ul><ul><li>DBP-DCI (technical) </li></ul></ul><ul><li>Demonstrate that… </li></ul><ul><ul><li>proper market incentives can increase efficiency and improve business confidence in land titling process </li></ul></ul><ul><ul><li>solution has long-term viability </li></ul></ul><ul><ul><li>proposed solution better than alternatives or status quo </li></ul></ul><ul><li>Land is national issue but locally driven. Thus, start reform at local level, Cebu City selected as pilot. </li></ul>
    14. 14. “ What’s in it for me?” City Government <ul><li>Cebu is place to invest; secure property rights </li></ul><ul><li>Cebu doing things differently from the rest </li></ul>City Planner <ul><li>Expand business; compete with other destinations </li></ul>City Tax Assessor <ul><li>More revenues and new sources of revenue </li></ul>City Register of Deeds (RoD) <ul><li>Checks and balance </li></ul><ul><li>Lighter workload for staff </li></ul>Bureau of Internal Revenue (BIR) <ul><li>More sources of revenue </li></ul>Taxpayers <ul><li>Credible system encourages compliance </li></ul><ul><li>Tax payment for secure property rights worth it! </li></ul>Banks <ul><li>More credible collateral for loans </li></ul>Investors <ul><li>Knowledge of good area for investment </li></ul>
    15. 15. “ Why start with Cebu City?” <ul><li>Basic system and correct mindset in place </li></ul><ul><li>Early adopter of ICT for public admin. reform </li></ul><ul><ul><li>Simple computerized database in early-1990s </li></ul></ul><ul><ul><li>Real Property Tax Information System (RPTIS) </li></ul></ul><ul><ul><li>GIS maps for land use and tax mapping </li></ul></ul><ul><li>SPRING ( S ystems & P rocedures R ationalization IN G overnment) </li></ul><ul><ul><li>systematic, step-by-step, results-driven approach to program management </li></ul></ul><ul><li>Willing and able local stakeholders in place </li></ul>
    16. 16. Electronic Land Market (ELM) <ul><li>Three-phased Approach </li></ul><ul><li>Phase 1 : Feasibility of interagency cooperation at LGU level (City Assessor and City RoD) </li></ul><ul><li>Phase 2 : Develop sustainable business model(s) </li></ul><ul><li>Phase 3: Develop a national roll-out strategy </li></ul>
    17. 17. Phase 1: Inter-agency Cooperation <ul><li>Probably first time that two government offices shared and integrated their respective databases! </li></ul>CEBU CITY ASSESSOR Tax Declaration ELECTRONIC DATABASE GIS map Land Title Tax Declaration CEBU CITY RoD Digital Land Titles
    18. 18. Digitizing a Document Any Internet-based Application Identification Authentication Digital Document Origination Document Delivery Document Storage Document Amendments & Cancellation Digital document is identified, authenticated, safely stored, and easily retrievable
    19. 19. Phase 1: Scanning of Titles <ul><li>DBP DCI scanned, inspected, encoded, and recorded 180,000 land titles </li></ul><ul><li>Done inside RoD vault for 3 months </li></ul><ul><li>Unit Cost: P1.39 ($ 3 cents) per image </li></ul><ul><li>Subtotal for image scanning: P250,200 ($ 5,560) </li></ul><ul><li>Total Cost for managing </li></ul><ul><li>activities in Phase 1: </li></ul><ul><li>P1 M ($22,000) </li></ul>
    20. 20. Spatial Information Reduces Risks <ul><li>Tax assessment layer </li></ul>Tax declaration GIS Map Orthogonal rubber sheet map
    21. 21. Scanning of a Picture <ul><li>Possible that not all local government officials, as commonly perceived, are corrupt. RoD opened his vault for scrutiny of outsiders! </li></ul><ul><li>Possible to link two government agencies together </li></ul><ul><li>Local government wants to initiate reform by creating a good verification environment </li></ul><ul><li>With integration of land titles and tax declarations, things are definitely better off today than yesterday </li></ul>
    22. 22. Policy Implications <ul><li>Insurance Commission </li></ul><ul><ul><li>policy that declares areas with digital land titling system as having reduced risks </li></ul></ul><ul><li>Central Bank </li></ul><ul><ul><li>policy supporting and promoting the use of the Cebu City platform for digital land titles as a standard for evaluating loan collaterals </li></ul></ul><ul><li>Local Governments </li></ul><ul><ul><li>policy promoting digital land titling as part of, and a priority in, their development program </li></ul></ul><ul><li>Policy to uphold the integrity of the system as binding and can stand in the court of law! </li></ul>
    23. 23. Next Steps? <ul><li>In Phase 2, s how proof of concept (or working system) </li></ul><ul><ul><li>Presentation to Insurance Commission in Aug 2008 successful, but … </li></ul></ul><ul><li>USAID-funded project closed, grant to ADMU ended in Sept 2008 </li></ul><ul><ul><li>Implications on momentum of reform activities and support of champions. “ Who will continue the work?” </li></ul></ul><ul><ul><li>Complete electronic land market system for Cebu pilot estimated at $89,000. “Who will foot the bill?” </li></ul></ul><ul><li>Government to finance succeeding phases? </li></ul><ul><ul><li>“ Will other donor agencies help?” </li></ul></ul><ul><li>Opportunity for private sector to invest in system? </li></ul>
    24. 24. Conclusion <ul><li>e-Gov guided by NPM principles can thrive in the Philippine context </li></ul><ul><ul><li>decentralized and market-driven approach </li></ul></ul><ul><ul><li>an understanding of incentive structure of stakeholders </li></ul></ul><ul><ul><li>strategy with potential for national leveraging </li></ul></ul><ul><li>ICT-led reforms can exist in harmony with bureaucratic institutions of developing countries </li></ul><ul><ul><li>ICT can make processes more efficient without threatening the tenure of bureaucracy </li></ul></ul><ul><li>Ultimately, innovative approach of pilots require time and sustained budget support </li></ul>
    25. 25. <ul><li>Thank you. </li></ul><ul><li>[email_address] </li></ul><ul><li>[email_address] </li></ul>