Local Governments, Civil Society, Democratization, and Development 125 performing local government units may not necessarily hold true in a developing country like the Philippines. The diagram shows two conditions--the initial level of development and the extent of social inclusion---that may militate against competition and participation, both of which are wanting in the Philippines. Capuno also warns that the relations exhibited would work in a governance mechanism that commits and binds local ofcials to promote the welfare of their constituency. In this diagram, such bind is additionally secured by processes that elicit the participation of citizens through local special bodies (LSBs) in the LGC, ensure the transparency of local governance transactions (again through the LSBs), and subsequently, the accountability of public ofcials, chiey through elections. Capuno stressed that ”where such mechanism is weak and thus the people not empowered, there arise government failures since local government units are susceptible to capture.” In a separate study, Capuno and Garcia (2008) note how information about local governance (transparency) increases the participation of people in local government projects or consultative bodies. In a subsequent paper, Capuno and Garcia (2009) also validated that the dissemination of performing ratings of local governance induced local governments to become more responsive. Progress in decentralization Several appraisals have been done on the outcomes of decentralization (Asia Foundation 2011; Panadero 2006). In general, the law on decentralization includes provisions that ensure the transfer of nancial resources and responsibilities from the central to the local government units. Manasan (2009) points out that the activities devolved are those that can be provided at the lower levels of government and are generally consistent with decentralization theorem. In addition, the three parameters of good local governance—accountability, transparency and participation—are also, in theory, addressed by the LGC provisions (Capuno 2005). In these assessments, it has been pointed out that the process of decentralization faced initial glitches due to the absorption of personnel who were to be devolved from national government agencies to LGUs, as well as a wait-and-see attitude among local governance stakeholders, from the elected ofcials to members of civil society groups. But the statutory terms of decentralization proceeded relatively smoothly from 1993 when the system of Internal Revenue Allotment (IRA) was set in place. This section takes on some of the indicators that decentralization has gone well. Fiscally endowed local governments For one, the IRA, an unconditional grant that constitutes 40% of national revenues, endowed all local government units, from the barangay to the provinces, with the resources required to deliver the services that had been