PJD 2017 Vol. 44 No. 2d
Enhancing the Philippine Legal, Regulatory, and Policy Framework for Distributed Energy Resources
PJD 2017 Vol. 44 No. 2c
Possible Effects of China's Belt and Road Initiative on Philippine Trade and Investments
PJD 2017 Vol. 44 No. 2b
Effect of Supply Chain Integration on Business Performance and Competitiveness of Philippine SMEs
PJD 2017 Vol. 44 No. 2a
Role of Subjective Perceptions and Migration Culture in the Formation of Migration Intentions: Evidence from a Rural Village in the Philippines
Publication Detail
DP 2020-05: Assessment of the Performance Challenge Fund and the Seal of Good Local Governance: Perceptions from Municipalities

The Performance Challenge Fund (PCF), established by the DILG in 2010, is a performance-based incentive program that gives financial subsidies to local government units (LGUs) that are awarded with the Seal of Good Local Governance (SGLG). Almost a decade after its introduction, how has the PCF evolved and been appreciated by local governments? Facing challenges such as budgetary constraints and the presence of other national government programs that offer support to local governments, is there a need for improvements in the design of the PCF and what are these areas that might foster improved governance for all local governments? To answer these questions, this study uses the results of a nationwide survey of all municipalities in the Philippines, focusing on the perceptions of the core members of the municipal planning team on the usefulness and importance of the PCF. Survey showed that majority of the local government respondents appreciated the PCF and recognized its importance. But the evidence also showed that about 20 percent of surveyed municipalities were never eligible to receive the PCF. Most of these municipalities were from the 5th and 6th income class, concentrated in the Bicol, Central and Eastern Visayas regions. In addition, there were some LGUs that were either consistently or not consistent recipients of the PCF. These results must be considered by policymakers especially with the recent passage of the Seal of Good Local Governance Law. Comments to this paper are welcome within 60 days from date of posting. Email

Philippine Institute for Development Studies
Authors Keywords
Diokno-Sicat, Charlotte Justine; Mariano, Maria Alma P.; Castillo, Angel Faye G.; Maddawin, Ricxie B. ; incentives; local governance; asymmetry; Performance Challenge Fund; Seal of Good Local Governance;
Download PDF Number of Downloads
Published in 2020 and available in the or can be downloaded as full text Downloaded 259 times since March 17, 2020