Integrating Environmental Considerations into the Economic Decision-Making Process

Volume I

East and Southeast Asia

Philippines


		II. MECHANISMS FOR INTEGRATING ENVIRONMENTAL CONSIDERATIONS INTO OVERALL ECONOMIC POLICIES [ II-A \| II-B \| II-C \| II-D ] A. Mechanisms and experiences in integration [ A-1 \| A-2 ] 2. Other mechanisms Other mechanisms exist for integrating environment into overall policies at all levels and aspects of economic decision-making, i.e., investment programming (including programme/project approval, review and implementation); and policy formulation, implementation and review. (a)Investment programming The incorporation of environmental concerns into investment programming is manifested in the mechanism for project evaluation and approval of projects by ICC. Part of the ICC guidelines is a requirement for the submission of the EIS system and the ECC before ICC clearance is given for proposed development projects. That is a clear-cut mechanism of coordination between NEDA as the economic planning body and the Department of Environment and Natural Resources which issues ECCs. Effective coordination, however, is constrained by problems related to the synchronization of the ICC approval process and ECC processing. The latter normally takes some time to complete. On the other hand, in view of the urgent nature of some development projects, conditional approvals are sometimes issued. Moreover, since the Department of Environment and Natural Resources membership is confined to the ICC-Technical Board and not the ICC Cabinet Committee, there may be a significant gap in providing the Department with ample avenues for influencing final decisions on a project. The ICC review excludes projects below P300 million. Technically, all projects have environmental effects in varying degrees, but the ICC process effectively leaves out a great number of locally-funded projects in its review. Nevertheless, there are ongoing efforts to improve the ICC guidelines in terms of strengthening the integration of environmental concerns, including an effort to "green the Economic Internal Rate of Return" which is aimed at studying and recommending methodologies for establishing environmental costs and benefits in the economic and financial analyses of projects. Another initiative is geared towards assessing the current social discount rate and examining whether the rate incorporates the environmental dimensions. ICC is also in the process of developing a framework for financing local, environmentally-oriented projects. The integration of environmental concerns into project development and implementation by the various departments may have been facilitated byExecutive Order 291 in 1995 which called for the establishment of in-house environmental units in all agencies and GOCCs. The functions of those units are seen as: Assisting in EIS preparation to ensure that their respective agencies conform with the procedural requirements of the EIS system, facilitating the securing of ECCs for the respective projects, and ensuring compliance with the conditions in ECCs; Ensuring, for GOCCs, that loans or related funding applications by government and private institutions have complied with the EIS system. The creation of EUs in all agencies has enhanced the coordination and reduced the potential for conflict between those agencies and the Department of Environment and Natural Resources. In the past, approval of projects proposed by some government agencies were delayed because issues arising from EIS came late in the cycle of project development. As agencies became pressured to pursue a certain project, in view of urgent and pressing concerns such as road and transport projects, delays in ECC clearance resulted in the Department of Environment and Natural Resources being perceived as adversarial or obstructionist. EUs are therefore expected to strengthen the capacity of agencies in addressing environmental concerns as they require those agencies to be more active in the preparation of EIS. Moreover, conducting feasibility studies and EIS simultaneously is required, facilitating the integration of environmental concerns into project decision-making. That also affirms current thinking that to effectively integrate environmental considerations into the choice of development projects, EIS should be used as a planning tool and not as a regulatory tool. (b)Policy formulation, implementation and review Coordinating policy formulation and implementation is mainly done through the regular meetings of the various committees and units under the NEDA Board, the Cabinet Cluster and LEDAC as well as the various ad hoc bodies created to address pressing issues, urgent matters and strategic concerns. Coordination is facilitated by the NEDA in almost all of the subject units, giving it an overall vantage view of the matters under discussion and, to a great extent, leverage for influencing the agenda in the various units to ensure consistency and continuity. This can also be said of other agencies that are consistently represented in such bodies. Coordination may be effective among the Cabinet-level bodies (especially since they are chaired by the President), because of the consistency in the level of representation (at least under-secretary level). Moreover, for decisions at the Cabinet level, the President requires the doctrine of complete staff work which means prior consultation with all relevant sectors and agencies. Therefore any conflicts should already have been resolved through the deliberations at the meetings of those bodies. Conflict resolution is basically achieved through a negotiation process among the agencies and entities concerned during discussion meetings and wider consultations. The doctrine of complete staff work has effectively forced agencies to be more open to compromise and in seeking options. However, in the case of the other ad hoc bodies, in which representation maybe irregular, temporary and inconsistent, coordination is more difficult as it becomes dependent on the efficiency of the reporting and monitoring mechanisms within a particular agency. Conducting policy forums also provides a good alternative venue for soliciting the views of a wide range of sectors and stakeholders on a particular issue. The results of those forums provide the basis for firming up or establishing the position of an agency on a certain issue. Top