2. PUBLIC ECONOMIC ENTERPRISES-a business like
entity,wholly or partially owned by local
government that sells a product or service to meet
a perceived specific public demand.
COMMON PUBLIC ECONOMIC ENTERPRISES:
1. Public markets
3. Bus terminals
3. FUNDING-money provided, especially by an
organization or government, for a particular
MANPOWER- the number of people working or
available for work or service.
GOVERNMENT FUNDS: the public enterprises get
their capital from government funds and the
government has to make provision for their
capital in its budget.
4. CHARACTERISTIC OF A PURPOSEFUL PEEs:
• With clear vision, mission, goals and objectives
• Has a form that supports the long term LGU
sustainable development plants
• Supported by national and local policy
• Managed according to well researched business
• Managed using a performance based approach
• Demonstrates innovation
5. HOW DO PURPOSEFUL PEEs CONTRIBUTE TO
• Require less subsidy from government and generate
• Equitable delivery of products and services will
increase the access of marginalized groups to local
• Quality services such as utilities, markets and
transportation will attract potential investors to the
6. LOCAL GOVERNMENT CODE PROVISIONS ON LOCAL ECONOMIC ENTERPRISES
• Republic Act 7160, otherwise known as the Local Government Code under
Section 17 provides……….
• (a) Local government unit shall endeavor to be self reliant and shall
continues exercising the powers and discharging the duties and functions
currently vested upon them. They shall also discharge the functions and
responsibilities of national agencies and offices devolved to them pursuant
to this Code. Local government units likewise exercise such other powers
and discharge such other functions and responsibilities as are
• ….appropriate or incidental to efficient and effective provision of the basic
services and facilities enumerated.
(IX) public markets, slaugterhouses and other municipal enterprises;
(X) public cementery
Under section 17, the phare “and others” is added , which connotes that any
other utilities or revenues.
7. LOCAL PUBLIC ENTERPRISES (LPEs) include:
• Public market
• Transport terminals
• Fish landing and cold storage facilities
• Post harvest facilities
• Water supply
• Public parks
• Public cemeteries
8. • Implications of the Issues to the Country
• Efficient and effective delivery of LPEs will redound to the greater benefits
of the country. The efficiency and effectiveness of LGUs public service at the
local level have a great impact to human development outcomes and
national economic growth.
• LPEs are authorized to collect fees and charges to cover costs of
administration and operations. Unfortunately, almost all of them operate at
a loss except for few that is properly managed.
• LPEs are always part of the regular budget rather than a multi-year
economic and financial investments. Historical records show that 70% - 80%
of LGUs annual appropriations go to administrative and recurrent
• Almost all of the existing economic enterprises are subsidized by local
budget which are always unlimited. The LPEs are unsanitary, congested, fire
hazards, poorly maintained-conditions that fall short of the required
standards of public health and safety. These are evident in the 4th and lower
9. • Problems and Issues on Local Economic Enterprises
• Various problems of PEEs
1. Most operate at a loss and require heavy subsidies from LGUs
2. Most are operated according to traditional practices without regard for new
technologies, local development priorities and changing consumer demand.
3. Many are inefficiently managed, wasting previous resources
4. Many offer substandard and poor quality products and services
5. Some provide products and services below market rates in unfair competition
with the private sector.
6. Some are established opportunistically without regard for their financial
feasibility and their impact on the local ecological, economic and social
Various policy options are available to LGUs and NG to effectively address the issues.
Many developing countries suffer from endemic poverty, slow economic growth,
unequal distribution of income and wealth, low levels of agricultural and
industrial investment, and ineffective government services. Compounding, and
partly giving rise to, these problems are shocks emanating from the world