Can the National Government interfere with how the local government units allocate their own

resources?

No, jurisprudence expressly provides that local governments are given the power to allocate their
resources in accordance with their own priorities.

Under Section 25 of Article II of the 1987 Constitution, which provides that The State shall ensure the
autonomy of local governments. Further, in Congressman Mandanas, et al. v. Executive Secretary Ochoa,
et Al. (G.R. No. 199802, July 03, 2018), the constitutional mandate to ensure local autonomy refers to
decentralization. Furthermore, it is provided under the abovementioned case that as a system of
transferring authority and power from the National Government to the LGUs, decentralization in the
Philippines may be categorized into four, namely: (1) x x x; (2) x x x; (3) fiscal decentralization; and (4) x x
x. Fiscal decentralization means that the LGUs have the power to create their own sources of revenue in
addition to their just share in the national taxes released by the National Government. It includes the
power to allocate their resources in accordance with their own priorities.

However, fiscal decentralization does not signify the absolute freedom of the LGUs to create their own
sources of revenue and to spend their revenues unrestrictedly or upon their individual whims and
caprices. Congress has subjected the LGUs' power to tax to the guidelines set in Section 130 of the LGC
and to the limitations stated in Section 133 of the LGC.

Under Section 130. Fundamental Principles of the LGC

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(d) The revenue collected pursuant to the provisions of this Code shall inure solely to the benefit of, and
be subject to disposition by, the local government unit levying the tax, fee, charge or other imposition
unless otherwise specifically provided herein; x x x

The concept of local fiscal autonomy does not exclude any manner of intervention by the National
Government in the form of supervision if only to ensure that the local programs, fiscal and otherwise, are
consistent with the national goals.

Therefore, the above stated principles clearly provides that local governments are given the power to
allocate their resources in accordance with their own priorities and that the National government only
exercises supervisory powers in ensuring that the former’s local programs are consistent with the latter’s
national goals.