municipal budgets, as opposed to things like infrastructure construction that are not. This is evidenced in the survey data by several instances where municipal health projects are reported to involve the procurement and distribution of medicines and general health inputs.

The aspect of health service that the national health policy makes municipalities responsible for lends itself to providing greater benefits to the poor and reducing health inequality. Using community-based midwives and trained health workers to provide basic services, free of user charges, such as immunization, antenatal care, assisted deliveries, health outreach—have long been at the core of the primary health care approach advocated by WHO and UNICEF to reach disadvantaged populations and promote “health for all”. The bulk of municipal health spending goes towards the salaries of health personnel, predominantly nurses, midwives and community health workers that are stationed at village clinics. Using the Demographic and Health Surveys for the Philippines, Gwatkin et al (2007) show that the lowest quintile of households rely overwhelmingly on nurses or trained midwives; the richer quintiles rely instead on the services of doctors, who are not a significant part of municipal health policies or workforce.

However, despite the availability of these policy instruments, whether municipal governments indeed have sufficient incentives to avail of them to deliver services to the poor is a question of political economy. Actual benefit incidence of public health spending has been shown to be much less pro-poor than was expected given the concerted advocacy of the global health policy community (O’Donnell et al, 2007; Gwatkin et al, 2007). This paper suggests that part of the problem is that governments in developing countries, who rely on clientelist forms of political competition, have weak incentives to invest sufficiently in and effectively deliver health services to the poor.

Municipal health spending in the Philippines averages around 8 percent of total municipal spending, after more than 50 percent being allocated to general administration, and around 20 percent to the so-called “local development fund” that largely consists of infrastructure construction and repairs.<sup>18</sup> The remarkably high share of administrative spending in municipal budgets is not inconsistent with clientelist political economy arguments that governments tend to allocate significant resources to providing jobs in the public sector to friends, family and political supporters (Fafchamps and Labonne, 2012). Other political economy work in the Philippines, and internationally, suggests that spending on capital construction projects might also be politically attractive because of the relatively greater possibilities for rent-seeking and elite capture of benefits (Keefer and Knack, 2007; Khemani, 2012; Cruz and Matsuda, 2012). A byproduct of these arguments, which this paper is in a position to examine empirically, is that primary health services that are pro-poor are particularly likely to be neglected by politicians

> 18 These numbers are calculated by the author using official data on local governments’ Statements of Income and Expenditures for the years 2001-2006, published by the Bureau of Local Government Finance within the Ministry of Finance. Municipal governments are overwhelmingly dependent on fiscal grants from the center to finance their expenditures. As a condition of receiving the Internal Revenue Allotment, municipalities are required to set-aside a share for the so-called “Local Development Fund” (LDF) which typically finances capital construction projects. However, the LDF can finance non-construction, non-wage spending which in the health sector can consist of things like procuring medical equipment or medicines or nutritional supplements. In this paper, the correlation of vote buying is estimated both for reported spending on health and on health projects at the village level that might be financed by the LDF,

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