Strengthening the Capacity of the Local Government Academy to Coordinate and Oversee Local Government Training and Capacity Building With the objective of developing a conceptual and operational framework to better coordinate and harmonize local government capacity building programs, and strengthen the institutional arrangements to implement local government programs, this IDF proposal will addresses two main issues. First and more broadly, the proposal examines the conditions necessary to create a functioning market for LG capacity building which addresses issues of fragmentation, duplication and unmet demands. Secondly and more specifically, it will review the structure and functions of LGA, with a view to move it away from being a training provider towards a greater oversight and coordinating role. The Department of Interior and Local Government(DILG)and the Municipal Development Fund Office (MDFO) fully support this shift in the role of LGA from being a provider of training to a knowledge broker, leading to improved coordination and harmonization in capacity building interventions.  In addition, this activity would have a direct impact on the proposed Bank assistance for a Performance Grant System (FY09 deliverable) - which will provide development grants to LGUs that meet prescribed performance criteria, or provide capacity building grants to LGUs that fail to meet performance criteria (in order that they may qualify for development grants in later rounds). The proposal supports the 2006-2008 CAS objective of improving the capacity of public institutions and services to deliver on its social contract with its citizens and thus help the country achieve its development potential.  The CAS identifies two important levers for pursuing economic growth and social inclusion, namely, fiscal stability and improving governance.  This will occur at three levels of engagement, i.e. national, local and private sector.  Although the ultimate development objective is to improve the capacity of local governments in order to increase the likelihood of better outcomes across all services delivered by LGUs, the proposal identifies the LGA as the direct recipient of technical assistance given its potentially important role in creating a functioning market place for LGU capacity building as well as the development of a performance framework that is consistent across projects. It is noted that coordination and oversight are already part of LGA's existing mandate. Linking financing and capacity building to a clear performance framework in a practical way will also facilitate good governance at the local level. Capacity building to improve local government unit (LGU) competencies under decentralization remains a key development challenge for the Philippines. Although there is a large number of training institutions providing LGU training, the effectiveness of these programs is undermined by fragmentation, duplication, and lack of adequate coordination and oversight. This has resulted in poorly targeted training programs, and a mismatch between demand and supply of training. The proposed IDF grant aims to improve the institutional framework for the delivery of LGU capacity building initiatives by: (a) enhancing the role of the Local Government Academy (LGA) in the coordination and oversight of a highly fragmented market for LGU training; (b) enhancing LGA capacity to manage an updated inventory of LGU training activities/resources, and make this accessible to LGUs and training providers; and (c) conducting an exploratory study on the institutional requirements for launching a professional certification program for LGU staff linked to civil service reform. This will build on the dialogue already underway between the Department of Interior and Local Government (DILG) and the Civil Service Commission (CSC), and competence assessments funded under other programs.