47811 Decentralization and local democracy in the world First Global Report by United Cities and Local Governments 2008 Decentralization and local democracy in the world First Global Report by United Cities and Local Governments UCLG wishes to acknowledge the Support of: Generalitat de Catalunya Decentralization and local democracy in the world 80 Global First 20 Report A co-publication of the World Bank and United Cities and Local Goverments United Cities and Local Governments Cités et Gouvernements Locaux Unis Ciudades y Gobiernos Locales Unidos © 2009 United Cities and Local Governments Avinyó 15 08002 Barcelona - Spain Telephone: +34 933 428 750 Internet: www.cities-localgovernments.org E-mail: info@cities-localgovernments.org All rights reserved 1 2 3 4 5 13 12 11 10 09 This volume is a product of an international network of experts associated with United Cities and Local Governments initiative. 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ISBN 978-0-8213-7734-5 -- ISBN 978-0-8213-7735-2 (electronic) 1. Decentralization in government. 2. Local government. I. United Cities and Local Governments. JS113.D426 2008 320.8--dc22 Printed in the U.S.A. Coordinated by the Research Network on Local Government in Europe (GRALE) Under the scientific direction of Gérard Marcou, Professor at the University Paris 1 Panthéon-Sorbonne, Director of GRALE CONTENTS Decentralization and Local Democracy in the World 7 CONTENTS Foreword 8 Preface 10 Editorial Project 12 Acknowledgments 14 Introduction 18 Africa 22 Asia-Pacific 50 Eurasia 94 Europe 128 Latin America 168 Middle East and Western Asia 204 North America 234 Metropolitan Governance 256 Conclusion 284 Postface 308 Bibliography 318 FOREWORD 8 Decentralization and Local Democracy in the World FOREWORD Decentralization and Local Democracy in the World 9 1st UCLG World Report on Decentralization and Local Democracy in the World Foreword This publication of the UCLG on Decentrali- Many developing countries seeking to res- zation and Local Democracy comes at a pond to the challenge posed by these timely moment. The world has just passed a demographic shifts will choose decentrali- significant threshold: it is now more urban zation and local democracy in various than rural, with a greater number of people forms as one tool to achieve basic social living in cities than at any time in history. ends. Regardless of the degree of decen- Furthermore, over the next 30 years most tralization, in an increasingly urbanized world population growth will be in develo- world governance and management in ping country cities. Highly visible mega- cities and towns will take on heightened cities will continue to grow, but more slowly importance. The World Bank applauds the on the whole, while cities under 1 million in work of the UCLG in underscoring these size are projected to absorb a population key functions and we welcome this Report increase of nearly one half billion in the next as input to our collective thinking on the 15 years. subject. This demographic shift constitutes the While many of the problems facing cities maturation of the urbanization process and and towns may be global, the solutions will, poses a tremendous challenge for poor and in large measure, be local and unique to the middle income countries. The challenge is to specific circumstances on the ground. Good provide the services that are essential to the solutions will result from a smooth collabo- health, education, prosperity, and well- ration amongst various levels of govern- being of people living in cities, and to do so ment that is crafted pragmatically to get sustainably in the face of global challenges results. We look forward to a strong part- such as climate change. nership with UCLG. Katherine Sierra Vice President, Sustainable Development The World Bank PREFACE 10 Decentralization and Local Democracy in the World PREFACE Decentralization and Local Democracy in the World 11 Preface It is my great pleasure, as President of the for creating social inclusion, managing cultu- World Organization of Local and Regional ral diversity and ensuring human security. Authorities, to present the first World Report on Decentralization and Local This publication follows the adoption by Mem- Democracy, published in cooperation with ber States of the UN Habitat Governing Coun- the World Bank and Cities Alliance. cil of the International Guidelines on Decentralization and Strengthening of Local I hope that this Report, which is the first of Authorities: the first international corner- its kind, will contribute to deepen and stone reference to "outline the main princi- strengthen knowledge about the role of ples underlying democratic, constitutional, local governments in the contemporary legal and administrative aspects of local world, and to enrich national and internatio- governance and decentralization1". nal discussions on the relationship between decentralization and development. Both the guidelines and this Report are the fruition of longstanding efforts by local The present Report clearly shows that the governments and their partners which I world is undergoing a quiet democratic hope will complement each other promoting revolution. Therefore, even if important the ownership and implementation of the aspects of this process have yet to be Guidelines by States and local authorities all accomplished, especially in countries in con- over the world. The Report constitutes the flict (in the Middle East, Asia and Africa) first stage of the World Observatory of local democracy is gaining momentum all Decentralization and Local Democracy over the world: from the African savanna project launched by United Cities and Local villages, the highlands of Latin America to Governments and supported by the UN the barangay in the Philippines. Habitat Governing Council. In a world where more than half of humanity I am convinced that this publication ­the first now lives in cities, local authorities are also of regular triennial reports­ will enable Uni- thekeytothesolutionofmajorcontemporary ted Cities and Local Governments to become challenges of all kinds: democratic, as it is in "a major world source of information and the local sphere that the sense of citizenship intelligenceonlocalgovernment"asanticipa- is reinforced and identities are constructed to ted by its members. deal with globalization; environmental, since the preservation of our planet and the fight against global warming depends to a great extent on finding sustainable solutions to transform current models of production and consumption, particularly in the urban areas; economic, given that large amounts of wealth 1. UN Habitat, 21st and opportunities, as well as extreme inequi- BertrandDelanoë Governing Council, Decisions and ties are generated within the cities and in Mayor of Paris Resolutions, Nairobi, their surroundings; and, social, as it is at the France 16-20 April 2007: local level where the grounds need to be set President of CGLU Resolution 21/3. EDITORIAL PROJECT 12 Decentralization and Local Democracy in the World EDITORIAL PROJECT Decentralization and Local Democracy in the World 13 EDITORIAL PROJECT UCLG Steering Committee · Jean Pierre Elong Mbassi, Secretary General, UCLG Africa · Christopher Hoene, National League of Cities, USA · Béchir Odeimi, Director of UCLG Lebanon and Jordan, Lebanon · Josep Roig, Secretary General, Metropolis · Rashik Sagitov, Secretary General, UCLG Eurasia · Jeremy Smith, Secretary General, Council of European Municipalities and Regions (CEMR) · Guillermo Tapia, Secretary General of FLACMA, Latin America · Peter Woods, Secretary General, UCLG Asia-Pacific · Selahatim Yildirim, Secretary General, UCLG Middle East & Western Asia Responsibility for the Publication · Director : Elisabeth Gateau, Secretary General, UCLG · Overall Coordination: Edgardo Bilsky, Director for Programs and Research, UCLG · Advisor: Emilia Saiz, Director for Statutory Issues and Institutional Relations, UCLG · Support team from UCLG: Hélène Abet, Dominique Arrestat, Mohamed Boussraoui, Orla de Díez, Sara Hoeflich de Duque, Grégoire Husson, Thomas Meekel, Olivia Paton, Marie Laure Roa, Virginia Molina, Marcus Mayr, Renske Steenbergen Scientific Direction · Gérard Marcou, Professor at the University Paris 1 Panthéon-Sorbonne, Director of GRALE, France Editorial Committee · Mustapha Adib, Professor at the Lebanese University and at the French-Lebanese Uni- versity Center of Technology, Director of the Center for Strategic Studies in the Middle East (CESMO), Lebanon · Alex B. Brillantes, Professor and Dean of the University of the Philippines, Eastern Regional Organization for Public Administration (EROPA), Philippines · Adrian Campbell, Senior Lecturer at the University of Birmingham, School of Public Policy, United Kingdom · Vincent Hoffmann-Martinot, Research Director of the CNRS, Director of SPIRIT (CNRS), Institute of Political Studies of Bordeaux, France · Talia Iaroulovna Khabrieva, Professor, Director of the Institute of Legislation and Com- parative Law of the Government of the Russian Federation · Biram Owens Ndiaye, Director, Municipal Development Partnership, Benin · Jefferey Sellers, Professor at the University of Southern California, USA · Salvador Valencia Carmona, Professor at the Nacional Autonomous University of Mexi- co (UNAM), Director of the Center of Legal Research, Mexico ACKNOWLEDGMENTS 14 Decentralization and Local Democracy in the World ACKNOWLEDGMENTS Decentralization and Local Democracy in the World 15 ACKNOWLEDGMENTS Main authors1 by chapters: · A.V. Pavlushkin, PhD, Institute of Legis- lation and Comparative Law of the Africa: Government of the Russian Federation · A.E.Postnikov, Professor at the Institute · Mustapha Ben Letaief, Professor at the of Legislation and Comparative Law of University of Tunis 1, Faculty of Law, the Government of the Russian Federa- Director of the Public Law Department, tion Tunis · N.V.Putilo, PhD, Institute of Legislation · Charles Nach Mback, Expert, Municipal and Comparative Law of the Govern- Development Partnership, Benin ment of the Russian Federation · Jean-Pierre Elong Mbassi, Secretary · Y.A.Tikhomirov, Professor and Vice- General, UCLGA Director of the Institute of Legislation · Biram Owens Ndiaye, Director, Municipal and Comparative Law of the Govern- Development Partnership, Benin ment of the Russian Federation · V.A.Vasiliev, Professor at the Institute of Asia-Pacific: Legislation and Comparative Law of the Government of the Russian Federation · Andrew Nickson, Lecturer, School of Public Policy, University of Birming- Europe: ham, United Kingdom · Alex B. Brillantes, Professor and Dean · Gérard Marcou, Professor at the Univer- of the University of the Philippines, Eas- sity Paris 1 Panthéon-Sorbonne, Direc- tern Regional Organization for Public tor of GRALE, France Administration (EROPA), Philippines · Hellmut Wollmann, Professor emeritus · Wilhelmina L. Cabo, EROPA, Professor at the Humboldt-Universitaet Berlin, at the University of the Philippines Germany · Alice Celestino, EROPA, University of the Philippines Latin America : · Nick Devas, Lecturer, School of Public Policy, Director of the International · Mario Rosales, Director of Studies, Asso- Development Department, University ciation of Municipalities of Chile of Birmingham, United Kingdom · Salvador Valencia Carmona, Professor at the Nacional Autonomous University of Eurasia: Mexico (UNAM), Director of the Center of Legal Research, Mexico · L.V.Andrichenko, PhD, Institute of Legislation and Comparative Law of the MiddleEast&WestAsia: Government of the Russian Federation · Talia Ia. Khabrieva, Professor, Director · Mustapha Adib, Professor at the Leba- of the Institute of Legislation and Com- nese University and at the French-Le- parative Law of the Government of the banese University Center of Technology, 1. Alphabetic list. If a Russian Federation, Team leader Director of the Center for Strategic person is quoted · V.I.Lafitsky, Professor at the Institute of Studies in the Middle East (CESMO), several times, titles Legislation and Comparative Law of the Lebanon and functions are Government of the Russian Federation mentioned only with the first quotation. ACKNOWLEDGMENTS 16 Decentralization and Local Democracy in the World North America (Indonesia), Alice Celestino (Philippines), Chandra-nuj Mahakanjana (Thailand), · Jefferey Sellers, Professor at the Uni- Musharraf R. Cyan (Pakistan), Gao Xiao versity of Southern California, USA Ping (China), Mathew John (India), Ngu- yen Ngoc Hien (Vietnam), Park In-soo Metropolitan governance: (Republic of Korea), Qiao Jingjing (Chi- na), Yasuhiro Sagawa (Japan), Arkaja · Vincent Hoffmann-Martinot, Research Singh (India), Fauziah Swasono (Indone- Director of the CNRS, Director of SPIRIT sia), Mike Tumanot (Philippines), Roger (CNRS), Institute of Political Studies of Wettenhall (Australia), Ahmad Jailani Bordeaux, France Muhamed Yunus (Malaysia) · Jefferey Sellers Eurasia: Conclusions L.V. Andrichenko (Russia), Alexander V. · Tim Campbell, PhD, Urban Age Institu- Batanov (Ukraine), N.A. Ignatyuk (Russia), te, USA Leïla T. Januzakova (Kazakhstan), Artur G. Kazinian (Armenia), A.V. Pavlushkin (Rus- Postface sia), A.E. Postnikov (Russia), N.V. Putilo (Russia), Vage V. Rafaelian (Armenia), · Gérard Marcou Nizami Safarov (Azerbaijan), Akmal Kh. Saidov (Kyrgyz Rep., Tajikistan, Turkme- nistan, Uzbekistan), Kiamran Shafiev Other contributors2: (Azerbaijan), Edgar E. Shatirian (Arme- nia), V.A. Sivitsky (Russia), Paata Tzino- Africa : vadze (Georgia), Grigorij A. Vasilevitch (Belarus), V.A. Vasiliev (Russia) Chabane Benakezouh (Algeria), Mustapha Ben Letaief (Tunisia), Hassan Ouazzani Europe: Chahdi (Morocco), Jose Chivava (Mozambi- que), Lilian Dodzo (Zimbabwe), Elogne Yves Cabannes (United Kingdom), Adrian Kadja (Côte d'Ivoire), Georges Kasumba Campbell (United Kingdom), Carlo Iannello (Uganda), Sylvana Rudith King (Ghana), (Italy), Gerardo Ruiz-Rico Ruiz (Spain), Djenabou Kone (Guinea), Nadjombe Gbe- Mayte Salvador Crespo (Spain) ou Kpayile (Togo), Aliou Maguiraga (Mali), Albert Malama (Zambia), Jossy Materu LatinAmerica: (Kenya & Tanzania), Charles Nach Mback (Rwanda), Issa Moko (Benin), Mahamadou Luciana Albuquerque Lima (Brazil), Pino Ndriandy (Madagascar), Nneka Udumma Alonso (Cuba), Paola Arjona (Colombia), Nkpa (Nigeria), Jean Charles Simobang Michel Azcueta (Peru), Felix Barrios (Guate- (Gabon), Enone Théodore (Cameroon), mala), Juan Carlos Benalcazar Guerrón 2. The majority of the Ibrahima Thioye (Senegal), Khaled Zaki (Ecuador), Antonio Cararello (Uruguay), contributors (Egypt), Bureau d'études & d'ingénierie Salvador Valencia Carmona (Mexico), Fer- mentioned below Conseil CERDDEA (Niger), Cabinet Ramm- nando Carrión (Ecuador), Jesús María compiled the UCLG ble Consultancy ­ Leola Rammble (South Casals Hernández (Venezuela, R. B. de), Country Profiles Africa) Rokael Cardona Recinos (Costa Rica, El Sal- (2007). These vador, Guatemala, Honduras, Nicaragua, profiles are available Asia-Pacific: at: Panama), Daniel Cravacuore (Argentina), http://www.cities- Ramón de la Cruz Ochoa (Cuba), Ruben localgovernments. Andy Asquith (New Zealand), Chris Aulich Hernández Valle (Costa Rica), Carlos Eduar- org/gold/ (Australia), Bambang P.S. Brodjonegoro do Higa Matsumoto (Brazil), Eduardo Klin- ACKNOWLEDGMENTS Decentralization and Local Democracy in the World 17 ger (Dominican Republic), Antonio Moreira Maués (Brazil), Dalia Moreno López (Mexi- Special acknowledgments for co), Andrew Nickson (Bolivia & Paraguay), financial and advisory support: Martha Prieto Valdés (Cuba), Mario Rosales (Chile), Alejandro Socorro (Cuba), Néstor Generalitat de Catalunya Vega (Ecuador), Alicia Veneziano (Uru- guay), José Luis Villegas Moreno (Venezue- Diputación de Barcelona la, R. B. de.) Pays de la Loire Metropolis: Philip Amis (United Kingdom) Middle East & West Asia: Mustapha Adib (Lebanon), Najem Al Ah- mad (Syrian Arab Republic), Mohammad Djalali (Islamic Rep. of Iran), Yeseren Elicin (Turkey), Mohammad Hachemi (Islamic Rep. of Iran), Adnan M. Hayajneh (Jordan), Aude Signoles (West Bank and Gaza) North America: Jean-Pierre Collin (Canada), Jefferey Se- llers (United States) INTRODUCTION 18 Decentralization and Local Democracy in the World INTRODUCTION Decentralization and Local Democracy in the World 19 INTRODUCTION "Local self-government denotes the right and The Report, drawn up by a network of experts the ability of local authorities, within the limits and university academics on every continent, of the law, to regulate and manage a under the scientific direction of GRALE (Rese- substantial share of public affairs under their arch Group on Local Administration in Euro- own responsibility and in the interests of the pe)1, is not intended to be exhaustive, local population". althoughamajorityofstatesaroundtheworld (European Charter of Local Self Government, are examined. Among the countries that were Part I, Art. 3) not included in the Report were those with insufficient information sources and/or failed states lacking local institutions or affected by One of the goals of United Cities and Lo- armed conflict. The Report focuses strictly on cal Governments since its creation in the municipal level (or equivalent), or the 2004 has been to create a Global Observa- intermediate tier of government when it is the tory on Local Democracy and Decentraliza- main level responsible for local government. tion "in order to analyze on a regular basis Relations between the local level and other the advances and possible reverses to local levels of territorial administration are also democracy and decentralization around takenintoaccount. the world, to anticipate potential changes and to analyze the obstacles faced and the The Report takes readers through the se- solutions required to overcome them" (UCLG ven regions of the world, defined in accor- Executive Bureau, June 2005). dance with the continental sections that make up the structure of UCLG. Each chap- This First Global Report, as we present it ter deals with three main themes: today, is one of the results of that initiative. It is also the first global attempt to offer a a) the evolution and development of terri- comparative analysis of the situation of local torial structures; authorities in every region in the world. The b) powers, management and finance; local elected representatives who are mem- c) local democracy. bers of the governing bodies of UCLG share certain core values regarding local gover- An eighth chapter examines the forms of nance issues and support the principle of governance of the metropolises, where subsidiarity, whereby decisions should be rapid growth presents significant challen- made at the level of government closest to ges, particularly in countries of the global the citizens. This Report will contribute to South and above all in Asia. This chapter is deepening reflection of these values. of particular interest to the metropolitan section of UCLG. 1. GRALE is an international scientific network attached to the Centre National de la Recherche Scientifique (French National Science Research Center) in Paris. It was set up in accordance with an agreement between the following French universities and other bodies: the Paris 1 Pantheon-Sorbonne University, the University of Reims-Champagne-Ardenne, l'Institut d'Etudes Politiques (the Institute of Political Studies) at Aix-en-Provence, the French Ministry of the Interior, the French National Assembly, the Inter-Ministerial Delegation on Regional Development and Competitiveness and the Compagnie Générale des Eaux. Dozens of research centres in France and abroad are members of the network. The eight specialist academic centres that are GRALE partners are: CESMO (Centre d'Etudes Stratégiques du Moyen Orient ­ Center for Middle-East Strategic Studies) in Lebanon, the Institute of Comparative Law and Legislation in Moscow, Russia, the Institute of Political Sciences in Bordeaux, France, the EROPA (Eastern Regional Organization for Public Administration) in the Philippines, the Partnership for Municipal Development in Benin, the Autonomous University of Mexico, the University of Birmingham in the United Kingdom, and the University of Southern California in the United States. INTRODUCTION 20 Decentralization and Local Democracy in the World Drafting the Report raised numerous metho- Hence, the fundamental issues and ques- dological and practical difficulties. In the com- tions of the growing debate are: What hap- parative work, the terms used and above all pens to local autonomy when the level of theconceptstheyexpressoftenconcealdiffe- financial autonomy is deficient or non-exis- rent meanings and connotations that simple tent, given the tendency of central govern- translation does not uncover. In-depth analy- ments to absorb a larger share of the ses are required, notably of the essential no- resources? What is the adequate proportion tions: "The Global Report calls for, and at the of local authorities' own resources and state same time makes possible, an effort to clarify transfers? What happens when interven- the essential notions," as expressed by tions by higher tiers of government within Gérard Marcou, the scientific co-ordinator, the state weaken the ability of local authori- who raises the key question as to "What do ties to freely choose the ways they manage we understand by decentralization, local de- their services and administrative structu- mocracy or even local self-government?" An res? More broadly, to what extent do decen- attempttoclarifythesemattersisgiveninthe tralization and subsidiarity enable local postface to the Report. authorities and their communities to impro- ve access to services and to work towards As the Report clearly shows, in the last 20 development? Moreover, how can we gua- years decentralization has established itself as rantee good quality services expected by a political and institutional phenomenon in citizens? most countries around the world. These coun- tries have local authorities, consisting of local These debates explain the rising interest assemblies elected by universal suffrage and among local authorities and international an executive, both of which are expected, to organizations in the definition of the uni- different degrees, to respond to their citizens. versal principles that serve as a reference As is shown by widespread legislative or cons- on a worldwide scale. The approval by UN- titutional reform, the global process has resul- HABITAT of the Guidelines on Decentraliza- ted in wider recognition of the role and tion and the Strengthening of Local position of local authorities as well as a signifi- Authorities in April 2007 was a major step cant increase in their powers and financing, forward in this direction, for which UCLG notwithstanding the many differences betwe- has worked very hard. en countries. The emergence of new political leadership at the local level is reflected almost The Guidelines recognize that sustainable everywhere in the creation of associations of development is made possible by "the effec- elected members or local authorities in more tive decentralization of responsibilities, than 130 countries (virtually all members of policy management, decision-making aut- UCLG). hority and sufficient resources, including revenue collection authority, to local autho- "The notions of `autonomía local', `local self- rities, closest to, and most representative government', `Selbstverwaltung' and `libre ad- of, their constituencies." The Guidelines are ministration' have gradually become the norm conceived as guidance on reforms but do in territorial administration in every region. not impose a uniform, rigid model. The gui- delines integrate notions of governance and However, the picture that emerges from democracy, representative democracy and the research contains sharp contrasts. In participative democracy; they define the many countries, these reforms are either principles that govern the mandate of lo- very recent or are facing difficulties in their cally elected authorities and the powers and implementation. Two issues come into view responsibilities of local authorities, based on of particular concern for local authorities, subsidiarity. The Guidelines also call for the especially in countries of the South: finan- introduction of constitutional and legislative cing and staff. guarantees to protect local autonomy and to INTRODUCTION Decentralization and Local Democracy in the World 21 ensure that local authorities have sufficient member states. human and financial resources to meet their responsibilities. The Guidelines draw their · Contribute to furthering global reflection inspiration from the European Charter of on local government systems of financing Local Self Government, to which the Euro- and management of human resources, pean section of UCLG contributed. The which UCLG intends to pursue. Charter, adopted in 1985 by the Council of Europe and today ratified by 46 countries, is the first document of a legal nature at an We would like to thank the experts and international level concerning the status university academics who have contributed and rights of local authorities2. to this Report, in particular GRALE, which has co-ordinated the work and ensured the The Global Report will allow the reader scientific quality of the project as a whole. to consider the problems that may arise in the implementation of these princi- Mention must also be made of the support ples and the way in which these difficul- given by UCLG's regional and metropolitan ties may be surmounted. We therefore sections, which, through their secretariats, invite local authorities and their natio- have constantly defended the direction and nal, regional and international associa- approach of the project. tions to engage in action with UCLG in order to: We would also like to express our gratitude to those institutions and local authorities · Circulate this Report and to press ahead that have contributed to the production of with the dialogue with states on the this Report, in particular the Generalitat de implementation of the Guidelines on De- Catalunya, for their continued support centralization and the Strengthening of throughout the project, the Diputació de Local Authorities. Barcelona, the Conseil Régional du Pays de la Loire and the Groupe DEXIA. · Ask national governments to support the adoption of the Guidelines on De- Without the commitment and collaboration centralization and the Strengthening of all these partners, the Report would not of Local Authorities by the General have been possible. Assembly of the United Nations. · Ensure that the principles of the Guideli- World Secretariat nes are supported by the regional insti- United Cities and tutions in every continent, thereby Local Governments contributing to their implementation by 2. The European Charter of Local Self-Government focuses mainly on the following principles: · Regulation and management of a substantial share of public affairs by local authorities, through local elected representatives and citizen participation; · Right of local authorities to exercise their initiatives with regard to any matter included in their powers and responsibilities and not assigned to any other authority; · Selection and recruitment of local government staff according to merit and competence; · Conditions of office of local elected representatives to allow free exercise of their functions; · Local authorities' financial resources to correspond to the responsibilities determined by the constitution and law, of which they may dispose freely within the framework of their powers; · Administrative supervision of local authorities only to be carried out according to procedures determined by the constitution or by statute; · Entitlement of local authorities to belong to an association for the protection and promotion of their common interests; · Legal protection of local self-government AFRICA MUSTAPHA BEN LETAIEF CHARLES NACH MBACK JEAN-PIERRE ELONG MBASSI BIRAM OWENS NDIAYE AFRICA 24 Decentralization and Local Democracy in the World AFRICA Decentralization and Local Democracy in the World 25 I. Introduction increase the financial and policy capacity of public authorities and local govern- Africa encompasses some 31 million ments in certain countries, especially in square kilometers and, according to combating poverty, providing access to recent estimates, houses a population of services and improving living conditions. more than 933 million.1 This rapidly grow- ing population (2.5% per year), charac- There has been a substantial rise in the terized by its extreme youth (median number of democratic political systems age: 20), is a mosaic of peoples speaking since the 1990s, in marked contrast to the many languages. Moreover, the region is 1950s and 1960s, the two decades follow- subject to rapid urban development; the ing African independence. During that ti- rate of urbanization in African countries me, one-party political systems predo- ranges from 40% to 70%. There are minated, and access to state power was thirty-four metropolises with more than often gained by means of coups d'etat. one million inhabitants; most are beset by the rapid growth of impoverished sub- In some areas, political and institutional urbs, as well as deficiencies in infrastruc- systems remain fragile. Considerable ten- ture, public transportation and basic sion still exists in parts of Central Africa The majority of urban services. Literacy rates on average (Democratic Republic of Congo, Central range from 40% to 60%. Civil disorder African Republic and Chad), West Africa statesareunitary and military conflict are commonplace in (Côte d'Ivoire, Liberia, Guinea Bissau, republics, but there a few regions, and in some countries a Sierra Leone and Togo) and East Africa sizeable percentage of the population suf- (Ethiopia/Eritrea, Somalia and Sudan). are also three fers from pandemics such as HIV/AIDS, states with federal malaria and tuberculosis. Most political systems are now multi-party, and leaders are chosen by universal suf- systems (Ethiopia, In economic terms, after some 20 years of frage. Some categories of local officials Nigeria and South implementing structural adjustment poli- (regional governors, walis in Algeria, Mo- cies, African countries are becoming rocco and Tunisia, mouhafidhs in Arab Africa) and three financially sound again, achieving an Republic of Egypt, and government repre- average annual growth rate between 4% sentatives in Cameroon) are still kingdoms and slightly more than 6% in 2005. appointed. Over the past five years, Africa (Lesotho, Morocco Despite these positive signs, Africa is still has seen 35 electoral contests, including economically underdeveloped. With nearly 20 presidential elections, five parliamen- and Swaziland) 15% of the world population, Africa tary elections, four constitutional referen- accounts for only 2% of world trade, and dums2 and six local elections.3 The major- receives only 3% of direct foreign invest- ity of states are unitary republics; three of ment. (China received about 22% of for- these, Ethiopia, Nigeria, and South Africa eign investment). Of the world's 47 least have federal systems. Lesotho, Morocco developed countries, as identified by the and Swaziland are kingdoms. Comparisons United Nations, 18 are in sub-Saharan of constitutional systems reveal the pre- Africa. The New Partnership for African dominance of presidential systems. South Development (NEPAD) has not yet been Africa has a mixed parliamentary and 1. Internet world stats able to attract significant aid and invest- presidential system, Niger has a semi- http://www.internet ment to the continent, or to mobilize presidential system and Morocco has a worldstats.com/stats African savings of which 40%, according constitutional monarchy. 1.htm. to experts, is invested outside Africa. Nev- 2. Algeria, Egypt, ertheless, some of the measures taken by The table below provides baseline data on Kenya, Mauritania, the international community, especially the geographic, political and economic po- Tunisia. the enhanced Heavily Indebted Poor sition, and territorial organization of African 3. Datacurrentat20th Countries Initiative (HIPC), should help to countries. December 2006. AFRI Table 1 Geographic, Political and Economic Position and Territorial Organization of Each Country Country Political Type of state Regional level Provincial level Supra communal level Municipality/Metropolitan level 26 CA Population / land area system Algeria Presidential Unitary 48 Wilaya 1541 municipalities 33.4 m /2,381,741 km2 Decentrali Benin Presidential Unitary 77 municipalities 8.2 m / 112.622 km2 zationan Cameroon Presidential Unitary 10 regions 2 metropolis 11 urban municipalities 16.3 m / 475,412 km2 11 districts 316 rural municipalities dLocal Dem Arab Republic of Egypt Presidential Unitary 26 Mouhafasats 217 cities and Luxor 4617 towns 76.7 m / 1,001,450 km2 (both decentralized and (Special Status) deconcentred structures) ocracyin Gabon Presidential Unitary 47 departments 50 municipalities 1.4 m / 267,670 km2 theWorld Ghana Presidential Unitary 166 district 21.1 m / 238,540 km2 assemblies Guinea Presidential Unitary 38 urban municipalities 9.5 m / 245,860 km2 303 rural municipalities (CRD)/ 1 city (Conakry) Côte d'Ivoire Presidential Unitary 19 regions 58 departments 197 municipalities and 2 cities: Abidjan with 10 municipalities 17.9 m / 322,463 km2 and Yamoussokro with town councils Kenya Presidential Unitary 8 provinces including 175 Local Authorities (municipal councils, town councils and 35.1 m / 580,370 km2 the City of Nairobi county councils) and 3 cities: Nairobi, Mombasa and Kisumi Madagascar Presidential Unitary 22 regions 1557 municipalities, including 45 urban municipalities, 18.6 m / 587,051 km2 (Faritany) 3 cities with special status: Antananarivo with six districts- Nosy Bé - Sainte Marie Mali Presidential Unitary 8 regions 49 cercles 703 municipalities 13.9 m / 1,267,000 km2 Bamako district (with six town councils) governed by special regulations Country Political Type of state Regional level Provincial level Supra communal level Municipality/Metropolitan level Population / land area system Morocco Constitutional Unitary 16 regions 49 provinces 1497 municipalities 32.2 m / 446,550 km2 Monarchy 13 prefectures (urban areas) Mozambique Presidential Unitary 10 provinces 33 urban municipalities 19.8 m / 801,590 km2 1042 localities (rural municipalities) Niger Semi Presidential Unitary 8 regions* 36 departments* 4 urban communities 265 municipalities, including 213 rural and 52 urban 13.2 m / 1,267,000 km2 (with Niamey) and 5 sedentarized nomadic groupings Nigeria Presidential Federal 36 Federated 774 municipalities 131.5 m / 923,770 km2 States Senegal Presidential Unitary 11 regions 67 municipalities, 43 innercity municipalities (in 4 cities), 11.4 m / 196,722 km2 2 metropolitan point authority, 321 rural municipalities South Africa Mixed parliamentary Federal 9 regions 47 municipal district councils 231 including 6 metropolitan municipalities 47.4 m / 1,221,041 km2 and presidential Tanzania Presidential Unitary A self-governing unit 92 rural district councils 1) 22 urban councils, 92 rural councils, 3 townships, 38.8 m / 945,090 km2 that is not federated, Zanzibar 2) within the districts: 10,075 registered villages Decentrali Togo Presidential Unitary 6 regions* 30 préfectures* 30 urban municipalities AFRI 6.15 m / 56,790 km2 zationan Tunisia Presidential Unitary 24 governorates 264 municipalities 10.100 m / 163,610 km2 (Wilaya, (both decentralized dLocal and deconcentred structures) Dem Uganda Presidential Unitary 79 districts 1 city council , 13 municipalities in urban areas - 34.2 m / 241,040 km2 87 town councils ocracyin Zambia Presidential Unitary 54 rural district councils 1) urban areas: 4 city councils, 14 urban district councils CA 10.6 m /752,614 km2 2) rural areas: none theWorld Zimbabwe Presidential Unitary 58 rural district councils 1) urban areas: 6 city councils, 28 urban councils, 10 municipal 13.01 m / 390,760 km2 councils, 8 town councils, 4 board councils 2) rural areas: none 27 Regarding territorial organization, this table highlights only local governments in these countries and not the administrative jurisdictions. * Provided by the law, regions, departments or prefectures, as well as rural municipalities in Niger, have not been established by norm. AFRICA 28 Decentralization and Local Democracy in the World The view of decentralization in African gov- was adopted. For internal territorial ernments seems to fluctuate between administration, however, the preferred regarding it as a technique of administrative approach tended more toward decentral- organization and ­more rarely­ as a genu- ization, though not to an extent that could ine long-term policy. If decentralization is a undermine an overarching philosophy of policy, it can help to change the operation centralization. Decentralization was still of existing political systems. If, on the feared and deliberately avoided if it threat- other hand, it is thought of primarily as an ened to move beyond administrative tech- administrative technique, it is likely to lead nique toward political substance and any only to rationalization of administrative democratic content. The concern of the structures and their effectiveness. new governing elites was to consolidate their power. From this perspective, the In practice, decentralization in Africa has quest for national unity ­seen as a way of most often been conceived and imple- combating potentially damaging tribal, mented as an adminis- local or regional affinities­ was given a trative technique. high profile. Modernization, economic In practice, decentralization in Africa Indeed, when colonial development and national unity became has most often been conceived and powers controlled most the favoured slogans. of Africa, they often implemented as an administrative sought to disrupt tradi- In African countries, the concepts of politi- technique tional ties in order to cal and administrative decentralization consolidate their cen- developed along the lines of the French tralized power. In some déconcentration ­state representatives at cases a colonial power did try to preserve an the local level rather than locally elected existing administrative model, but this bodies. From the outset they were strate- approach too was adopted primarily to gic instruments intended primarily to strengthen colonial power, rather than foster ensure uniform administration of the terri- self-governance. Predictably, local po- tory by the central government. The ideal pulations perceived the few decentralized of centralization predominated for a long structures set up by colonizers as tools for time, relegating the more democratic reinforcing the colonial presence. In all model of decentralization to the back countries in the region, this colonial legacy burner. of an ad hoc and often contradictory combi- nation of centralization and decentralization The constraints on putting decentralization formed the foundation of post-colonial terri- into practice have been apparent for a long torial administration. Following independ- time, though such restrictions have occa- ence, embryonic national administrations sionally undergone nominal modifications to relied on the familiar centralized model as disarm critics. For the most part, such they confronted urgent problems of superficial alterations, however highly resources, administrative management and approved or formally enshrined in the legal the establishment of state structures. The system, amounted to little more than cos- continuation of centralized power was seen metic palliatives. as expedient not only to control data and policy orientation, but also to deal with the Today, the legal status of decentralization shortcomings and failures of new govern- policies in most African countries is stipu- ments struggling to establish national lated in one of two ways: explicitly in a authority. constitution, or by lower-level laws and regulations. To date, less than 40% of This explains why, particularly in francoph- African constitutions mention local gov- one African countries, the centralizing ernments as a specific level of gover- model inherited from the colonial power nance. In countries where decentralization AFRICA Decentralization and Local Democracy in the World 29 and local governments are defined in there have been major territorial reforms, statutes of a lower rank than the consti- including the 1984 Algerian law, and tution, three main tendencies can be Morocco's 1996 constitutional reform and seen. Some countries have relatively 1997 law on regions. Despite the long expe- elaborate legislation with many regula- rience of North African countries with tions, decrees and ordinances for imple- decentralization, the autonomy of local gov- mentation. This model is found primarily ernment there is still restricted overall in re- in francophone countries. The profusion lation to the central state. of statutes complicates the implementa- tion of decentralization and slows things A complex picture thus emerges of mul- down, causing substantial delays between tiple historic, sociological, cultural, eco- confirmation of legality, and actual nomic, political and legal influences in enforcement; delays of 10 years are not African governments. Nevertheless, unusual. The second legislative tendency movement toward decentralization and involves a relatively small number of laws local democracy can be discerned. and regulations on decentralization. Typi- cally, only about half a dozen statutes The first major tendency, if not an actual cover the various aspects of implement- trend, is quantitative. Since independence, ing decentralization. The majority of in nearly every part of the continent there countries in this category are former has been noticeable, continuous growth in British colonies. Somewhere between the the number of local governments and in French and British models is North Africa, the territory they administer. This growth where there has never really been a is especially noticeable in the African major break in the decentralization policy. urban environment. Diversification and a The process there seems to have taken more refined and complex hierarchy of root in the colonial era, and has pro- structures and territorial tiers of decentral- gressed to this day with a kind of slow, ization can also be seen. sometimes imperceptible, continuity. Some of the earliest North African The table below compares population fig- statutes date back to the middle of the ures, rates of urbanization and the number 19th century (Tunisia, 1858). However, of local governments by African region. Table 2 Local Governments: Demography and Urbanization Regions Population (millions) Rate of urbanization (%) Municipalities (number) North Africa 154 62 4200 West Africa 264 40 3000 Central Africa 98 47 1000 East Africa 245 31 1900 Southern Africa 148 36 1300 Africa as a whole 909 38 11400 Source: PDM, 2006. AFRICA 30 Decentralization and Local Democracy in the World The second major tendency is qualitative, Africa, apart from Senegal and Burkina an increasing acceptance of the substance Faso, there is no real plan to implement of decentralization as a policy. decentralization. Rather, moves to decen- tralize in this region seem to rest on policy Although in most African states decentrali- announcements made in the speeches by zation has long been regarded primarily as heads of state. In East and Southern Africa, an organizational and administrative man- the history of decentralization is closely agement technique, it now seems to be related to the end of recent social and polit- gaining true political substance in many ical crises. There, implementation of de- countries. However slowly and gradually, centralization has a high priority in govern- decentralization is gaining recognition as an ment action plans and seems to be subject effective way to give increasingly robust to a pre-established, regularly assessed independent decision-making powers to timetable. The most exemplary case is local governments. This gradual consolida- South Africa, where the end of the tion of local electoral legitimacy also apartheid policy imposed a new approach to enhances the credibility of the decentralized governance that involves the entire popula- authorities. This trend is by no means dom- tion in public management at all levels. This inant; in some areas decentralizing activi- policy of transformation is enshrined in the ties seem to be mixed with traditional sys- Reconstruction and Development Program tems and, as in Algeria, challenged to the (RDP) whose entire philosophy can be point where it is virtually non-existent. summed up in the slogan "A better life for all." With the Local Government Transition Act (1993), adopted to govern the transi- tional period, the Municipal System Act In East and Southern Africa, the history of decentralization is (2000) and the Municipal Property Rating Act (2004), the South African government closely related to the end of social and political crises gave itself 11 years to set up a system of local governance that is almost revolution- ary compared with previous practice. Many countries, especially Niger, Senegal, Apart from South Africa, African govern- South Africa and Uganda, have already ments have not relied on rigorous planning undertaken decentralizing reforms in the to implement decentralization policies. It is organization of state and public life. These not surprising, therefore, that most of countries have organized local elections, them have no mechanisms to assess the and have seen local authorities emerging conduct and establishment of such poli- as new public authority figures alongside cies. This is why United Cities and Local national authorities. Admittedly, in most of Government of Africa (UCLGA) is asking these countries, the division of public that local governance be included in the authority has caused problems. In part, good governance criteria selected by the this may simply be because such a major Peer Review Mechanism of NEPAD. institutional change can be absorbed only slowly by many incumbent national Despite resistance, decentralization is moving authorities. forward in the region. More substantial progress may be expected as the number of Implicitly, implementation of the decentral- localgovernmentsincreases,andtheircapac- ization process has rarely been properly ities are enhanced. Understandably, the vari- planned. While North African countries have ous decentralization policies have not devel- a longstanding policy of decentralization, oped in the same fashion, or in accord with the pace of implementation there is not the same timetable. Implementation as well altogether uniform. In West and Central as the content of policies is strongly influ- AFRICA Decentralization and Local Democracy in the World 31 enced by the historical context from which exerted over local governments. There is a they emerged, and the administrative tradi- discernible retreat from practices reminis- tion inherited from the colonial era. cent of the exercise of power from the top down, and a move toward restricting over- The third tendency consists of a relative sight to strictly legal aspects, allowing increase in the responsibilities of local govern- greater local autonomy. However, it is also ments in many countries. In principle, this true that, in a few African countries, the increase bears witness to greater decentraliza- situation is less fluid, and there have in tion, and fits within the logic of disengagement fact been some setbacks. ofthestateandcentraladministration.Inprac- tice, however, it has proved problematic and These various movements, obvious and tan- even counterproductive in the absence of any gible to varying degrees, and often very real transfer of powers and financial resources. gradual with pauses, checks and less fre- In virtually all cases, the central government quently, qualitative leaps, can be seen (i) at retains control of local funds and taxation, as the structural level, (ii) at the material and well as its monopoly on foreign aid and financ- functional levels of responsibility and mana- ing. gement, and (iii), more globally and sub- stantially, in the progress and limits of local The fourth tendency, which is still at an democracy. embryonic stage, looks to enlist local and foreign private-sector resources to provide II. Changes at Structural Levels and manage a certain number of urban serv- ices, such as the collection of household or Municipal structures emerged in the 19th industrial waste (Tunisia, Benin, Burkina Faso century, particularly in Senegal, Egypt and South Africa), drinking water (Morocco), and Tunisia. In the 20th century, munici- or urban transport and sanitation. palities were established and gained ground in all colonial territories. Far from The fifth tendency, which is gradually tak- respecting principles of local participa- ing shape, involves setting up networks of tion, the system was designed to ensure local authorities to foster decentralized co- the colonizers' control over the territory, operation. The creation of national associ- and their ability to oversee the local pop- ations of local governments, including the ulation. Before independence, municipal UCLGA, and the reinforcement of their role administration in African colonies differed at the national level, reflects this tendency. somewhat, depending on the model pre- Such associations provide tools to enhance ferred by the controlling European the credibility of local authorities as rele- nation: the French system of "com- vant actors in the dialogue on develop- munes," the British local government ment and co-operation in Africa. In South system, and Portuguese "municipios." In Africa, the association of local government all cases, decentralization tended to be authorities, SALGA, is recognized as a pub- purely administrative. Few local bodies lic institution. Elsewhere, national associa- were elected; local executives were usu- tions of local governments have the status ally appointed and had only limited or of associations under private law, although consultative powers. Such decentraliza- some, such as the Association of Munici- tion also enabled administrators and palities in Burkina Faso (AMBF), may be colonists in rural areas to be governed by acknowledged as acting on behalf of public the same arrangements as their compa- interest. triots in colonial capitals and in Europe. The sixth tendency now emerging and cer- Overall, two systems, direct and indirect tainly varying from one country to another, rule, predominated in sub-Saharan Africa. is a modest relaxation of the control Direct rule was favored in countries colo- AFRICA 32 Decentralization and Local Democracy in the World nized by France, Belgium and Portugal. outset, the old systems were seen as Direct rule meant administrative oversight instruments for extending central power of colonial territory organized into "cer- over local communities. It was not until cles," subdivisions and cantons under the the 1980s and the ensuing wave of responsibility of the colonial administra- democratization in the 1990s that a new tors. Local authorities played only a con- direction gained momentum. Centralized sultative role. African governments showed renewed interest in decentralization. Gradually, local governments began taking charge of more local matters. In fact, changes in In fact, changes in administrative structure went hand-in-hand administrative structure went hand-in- hand with moves toward decentralization with moves towards decentralization, which formed the core in all endeavors to modernize the state. of all endeavors to modernize the State and with it public This widespread change in public policy in Africa was expected to lead to accept- policy in Africa, supposedly leading to "local democracy" as ance of "local democracy" as a key pillar a key pillar of the entire territorial administrative organization of territorial administrative organiza- tions. Since the mid-1980s, several fac- tors have pushed African governments toward economic liberalization and adjustment policies. These factors Indirect rule, established primarily in include: budget difficulties generated by British colonies, allowed local people some shrinking resources, challenges to inter- freedom to manage their own affairs, such ventionist public administration systems, as the administration of justice or the col- the resurgence of liberal ideas advocat- lection of taxes ­to be shared with the ing the rehabilitation of market mecha- colonial government. Indigenous customs nisms, the disengagement of the state, and authority were more or less ignored as and the changing roles of the public sec- long as local leaders protected the inter- tor and private initiative. These new con- ests of the colonial power. This system siderations implied taking part in global- sowed the seeds of future decentralization ization and international competition in these countries. required genuine policies of reform and restructuring, and this rationale affected In North Africa, the colonial administrative all subsequent reforms relating to local go- process was more complex. In this region, vernment and urban policy. 18th and 19th century colonial powers encountered many established state struc- However, not all African countries chose tures. For the most part, colonial municipal the same route in adopting and imple- administration under European nations menting decentralization policies. In the rested on old, indigenous structures, albeit majority of countries, decentralization heavily influenced by the recent, European policies were adopted following citizens' occupying power. Both the British in Egypt demands for increased participation. This and Sudan, and the French in Algeria, was strongly expressed by local communi- Morocco and Tunisia sought such accom- ties in pro-democracy movements during modation. the 1990s. Because of the connection between democratization and decentral- When African countries achieved inde- ization, some people saw the adoption of pendence, the new governments chose to decentralization reforms as a corollary to retain the structure inherited from the the democratization and liberalization that colonial power, rather than move imme- some financial partners of African govern- diately toward decentralization. From the ments were imposing as a condition for AFRICA Decentralization and Local Democracy in the World 33 providing aid. In some cases, central gov- The theory and content of decentralization ernments made the adoption of decentral- policies tends to be different in federal states ization policies appear to be the result of and unitary countries. The decentralization donor conditions. In Mali and Niger, decen- concept also varies in accordance with the tralization was a response to local administrative tradition inherited from the demands, including some violent demon- colonial period. In federal states, local gov- strations and threats of secession. In other ernments come under the remit of federated countries, decentralization provided an states; these federated states define the opportunity to overcome or even eliminate content of the local government system and the stigma of a previous political and its administration. This can lead to a wide administrative organization, as in the case range of methods of organizing local govern- of South African apartheid. ment ­a circumstance which does not facili- tate a comparative interpretation of local In North Africa, changes in local govern- governance. In unitary states, the organiza- ment structures seem to have come about tion of local governments is usually the same more slowly, and the reforms to have been throughout the national territory. However, less thorough. In all countries in this re- the actual powers granted to local officials gion, the territorial administrative struc- are, again, influenced by the administrative ture seems to be fixed, tied to the struc- tradition inherited from the colonial era. ture of the governorate (Wilaya in Algeria, Tunisia and Morocco, Mouhafadha in In francophone countries, the organization Egypt), which is more a tier of administra- of local governments corresponds in princi- tive decentralization. ple to a division of powers between central and local authorities, the latter being rep- Nevertheless, almost everywhere the resented by an elected deliberative body decentralization option is perceived as and an elected or appointed executive progress and is expected to: body. Municipal terms of office are usually similar to those of national institutions · Mobilize communities to work for sus- (four or five years) and re-election is tainable local development and allowed. In these countries, the municipal improved living conditions; executive, mayor or top administrator typ- · Help democracy to take root and spread ically has real decision-making power in at the local level; local management, the powers of this office · Reform the state and rebuild the legiti- being defined by law. However, this nomi- macy of public institutions from the nal decision-making power is often bottom up; restricted by the practice of pooling funds; · Constitute the starting point for that is, all public resources are held in the regional integration genuinely rooted in Treasury under the control of the Minister African realities. of Finance. Thus, the representatives of the Ministry of Finance, such as the comptrol- To achieve this, local governments are being ler and municipal tax collector, have effec- given general notional authority over the tive power over local governments. Many territory for which they are responsible. mayors consider such fiscal power exces- Some have exclusive powers as well as pow- sive because ministry representatives can ers they share with other levels of public block expenditure even if it has been com- governance. In North Africa, the powers of mitted in accordance with all laws and reg- local governments must compete with the ulations. It is therefore a claim of national central administration and various national associations of local governments to relin- public enterprises for service delivery (edu- quish or even suppress the principle of uni- cation, health, transport, sanitation, drink- fied treasury. However in Senegal the law ing water and electricity). makes it possible to deviate from this rule: AFRICA 34 Decentralization and Local Democracy in the World local governments may be authorized to mon elements are also apparent in big deposit all or only part of their available cities whose importance is determined by funds with the Treasury. demographic or economic weight, such as Johannesburg (South Africa), Douala In countries with a British administrative (Cameroon), Kumasi and Shama-Ahanta tradition, local governments also have (Ghana). All such major cities are gov- elected deliberative bodies; executive bod- erned by distinct legal arrangements that ies are either elected or appointed. The constitute important organizational and terms of office of deliberative bodies are managerial exceptions to the more com- similar to those in fran- mon laws of municipalities. cophone countries, but those of the executive More generally, African decentralization body ­one to three In Morocco, the new commune char- systems classify lower-tier local years­ are shorter. ter of October 3, 2002 made special Furthermore, re-elec- arrangements for cities with more authorities according to their level of tion is not always per- than 500,000 inhabitants. These mitted. Mayors generally cities are managed by a single com- development or urbanization haveaceremonialrather mune with arrondissements that are than executive role. Real not legal entities. Morocco modeled executive power is its system on the French political actually held by another public official, the configuration of Paris, Lyon and Mar- Town Clerk or Chief Executive Officer, who seille (known as PLM Law). more often than not is appointed at the The Moroccan charter also decreed national level by the Minister for Local Go- special status for the urban commune vernment. As they do in francophone coun- of Rabat, the capital, and the Me- tries, national associations supporting local chouar communes where the royal governments seek further decentralizing palaces are situated. reforms in anglophone countries, including the establishment of true executive powers for mayors, and an extension of mayors' Typically, major African cities are divided terms of office. into sub-urban administrative units, which may be separate legal entities. The latter Governance of major cities is the case for the urban arrondissement communes in Douala and Yaoundé in Most countries on the African continent are Cameroon. Sub-metropolitan communes experiencing a marked trend toward created in this way are governed by the urbanization, the gradual movement of common law of municipalities. Conversely, rural populations into the cities. This phe- in some countries sub-metropolitan units nomenon is considered a vector of mod- remain sub-municipal bodies without ernization and competitiveness, not only administrative autonomy; this occurs in for cities, but also for the surrounding ter- Accra and Kumasi in Ghana, and Cotonou ritories. in Benin. In most parts of Africa, the organization of Elections also differ somewhat in major major metropolises ­particularly capital metropolises; the deliberative body is cities­ tends to display specific features. elected by direct universal suffrage, as for Such features can be identified in political example in Algeria, Nigeria, Gabon and capitals such as Rabat (Morocco), Lusaka Madagascar. Those elected then appoint (Zambia), Dakar (Senegal), Tswane one of their fellow representatives as (South Africa), Yaoundé (Cameroon), municipal executive. Another method of Accra (Ghana) and Algiers (Algeria). Com- selection is appointment by indirect universal AFRICA Decentralization and Local Democracy in the World 35 suffrage. Metropolitan councillors are African local governments continue to elected by the deliberative bodies of the experience very serious financial con- sub-metropolitan units; most candidates straints on their resources and powers. are members of that deliberative body, as is the case in Cameroon. As for the distri- The administrative capabilities of local bution of powers, sub-urban units are governments are also restricted by a responsible for local community services, shortage of qualified personnel and the and are forums for participatory democ- wherewithal to train employees properly. racy. Federative services of importance to In part, it is this dearth of skilled officials the entire city are provided by the larger, that has lead to inefficient and ineffective central government of the city. local management, particularly in the areas of strategic planning, urban develop- Many African decentralization systems ment, economics and social development. classify lower-tier local authorities accord- Lacking qualified personnel, some local ing to their level of development or urban- and urban governments have turned to the ization. For example, in decreasing rank of private sector for help in the management urbanization Cameroon has urban commu- of local affairs, public services and prop- nities, urban communes under a special erty. Recently, several African cities have scheme, urban communes and rural com- also sought private assistance with mod- munes. In South Africa, classification takes ern information and communications tech- the form of an alphabetical hierarchy with nology. category A, B and C municipalities. Such dif- ferentiation makes it easier to identify the III.1.Responsibilities most disadvantaged authorities and, through a process sometimes called equalization, to One of the most important aims of decentral- focus on their development with specific sup- ization is to provide an effective, appropriate port policies. response to the needs of local communities for public services. The density and efficiency The governmental variations observed in of public services are among the most impor- major cities point up the need to define the tant indicators of the vigor of decentraliza- minimum common content of over-arching tion, and provide a vital source of legitimacy African decentralization policies. In fact, for local governments. Unfortunately, such an African local government charter that services seem unsatisfactory in virtually all addresses this need for more standardiza- countries. The prerogatives of local govern- tion is currently being mooted. The debate ments also vary from country to country, is being driven in particular by the United with two notable tendencies: Cities and Local Governments of Africa (UCLGA) and the African Conference on · Increased responsibilities of local Decentralization and Local Development authorities for local services and urban (CADDEL). management. · More private-sector management of local III. Responsibilities, Management public services by means of various and Finance forms of devolution, such as delegation, licensing and partnerships. Undeniably, there is a trend toward strengthening the responsibilities of local Table 3 shows that a majority of countries governments. However, the transfer of grant many important powers to local go- responsibility may not be accompanied by vernments. The scope of responsibility co- a transfer of the money or other resources vers social investment ­infrastructure and required to fulfill the added duties. Most social facilities, health, education, leisure­ AFRICA 36 Decentralization and Local Democracy in the World and the provision of goods and services for African countries, as well as a few anglo- education, health, culture, leisure, trans- phone countries in West Africa. In these port, water and sanitation. Local responsi- countries, sectoral ministries are gradually bilities also cover administration, urban disengaging from the implementation planning and management, and local de- phases of their programs. The result: local velopment. governments are taking over the local departments that previously came under Successful decentralization depends on the the territorial jurisdiction of sectoral min- manner in which power is transferred to istries. This transfer of authority, seen in local governments. Invariably, transfer of Ghana, South Africa and Uganda, necessi- authority provokes resistance from man- tates changes in staff, budget resources, agers within larger regional and national assets, and decision-making power. In ministries. In North Africa, transfer of these countries, central government power may be considered only nominal. In defines strategic guidelines for sectoral this region, national ministries typically policies regarding health, water and edu- cation. Local governments, however, are The ministries concerned tend to bypass local governments responsible for implementation. Wherever such territory-wide measures have been in implementing sectoral policies. They are encouraged undertaken, as in the case of water and to a greater or lesser extent in this by the practices HIV/AIDS policy in Uganda, the effective- of development partners who are often in ignorance of the ness of these policies has increased sub- stantially. However, the decentralization consequences of applying such policies process is often hindered by national sec- tor-based policies that tend to privilege retain control of local services, or delegate deconcentration (limited transfer of them to the private sector. Sectors such as responsibilities). One of the recurrent education and health are managed directly claims of African local authorities is that by the corresponding ministries, while sector-based policies should be territorial- drinking water, sanitation and energy are ized and thus more decentralized, as in either state monopolies, or are provided Ghana, Uganda or South Africa, and that by private concerns. In virtually all cases, local authorities should be fully responsible the private providers are under contract to for their implementation. the state, rather than to local authorities. This tendency can also be observed in While public assertion of the new nominal West and Central Africa, although basic powers of local governments is widespread, services there for education, health, water, the actual transfer of real executive and sanitation and transportation are generally operational powers is still rare. The chal- acknowledged as local concerns. Even so, lenge remains to resolve the problem of the ministries in this region also tend to effectively transferring the real financial and bypass local governments in implementing managerial powers from the centralized long-range sectoral policies. The ministries ministries to local authorities. Financial are often encouraged by their private part- management is, of course, the crucial factor. ners to minimize larger policy discussions with local authorities. It appears to be of III.2.FinancialManagement small concern to private developers how their pressure for increased central control Local government finance comes from two might affect a national momentum toward main sources ­local taxes and state grants. decentralization. In some places, local governments share local tax revenues with the central govern- Nevertheless, there are promising devel- ment. The state also makes financial trans- opments in several eastern and southern fers to local governments in the form of con- Table 3 Responsibilities of Local Authorities COUNTRY POWERS OF LOCAL GOVERNMENTS (COMMUNES/MUNICIPALITIES) Planning and support to Drinking water, Security (administrative Town planning Basic services (health, Sport Culture Energy Transport the local economy waste, sanitation police and CID) and habitat basic education) and leisure and tourism Algeria X X X X X X X Benin X X X X X X X X Cameroon X X X X X X X Egypt, Arab Rep. of X X X X X X X X Gabon X X X X X X X X Ghana X X X X X X X X X Guinea X X X X X X X X Côte d'Ivoire X X X X X X Kenya X X X X Decentrali Madagascar X X X X X X AFRI Mali X X X X X X X X X zationan Morocco X X X X X X X X X Mozambique X X X X X X dLocal Niger X X X X X X X X Dem Nigeria X X X X X X X X Senegal X X X X X X X X ocracyin South Africa X X X X X X X X X CA Togo X X X theWorld Tunisia X X (waste only) X X X X X Uganda X X X X X X X X 37 Zambia X X X X AFRICA 38 Decentralization and Local Democracy in the World ditional or unconditional grants, and other tate tax in Ghana, South Africa, Tanzania, types of state financial contributions. The Zambia and Zimbabwe, and service fees in specific method of funding local development the afore-mentioned countries and Nigeria. varies from country to country. The capacity Nonetheless, local taxation in some coun- to mobilize "own revenues" is one of the fun- tries is negligible (e.g. Nigeria and Uganda, damental principles of decentralization. where tax revenue as a percentage of total revenue dropped from 30% to 11% in five III.2.1. Local resource mobilization years after the removal of the more produc- tive "graduated tax"). Local government Legislation allows African local govern- powers to create indirect duties or tariffs on ments to raise a panoply of resources in local activities are also exceptional (e.g. in their own territory from direct or indirect Zambia and Mozambique). It is however, local tax revenues, service tax, fees col- necessary to relativize the importance of lected from the operation of services, these local taxing powers, bearing in mind economic activities or municipal asset the decisive control of central governments management. Unfortunately, the law over revenue mobilization (such as the prior does not always list the necessary local approval required for rates and tariffs in government taxing powers to alter the Zambia), the low levels of own source rev- volume of their revenues; which means enues (see the case of Ghana in Figure 1) that municipal incomes generally and the percentage of own revenues making regarded as "own resources" are in fact up a small share of the whole budget (30% controlled by central government. on average, except in Zambia ­77%­ and South Africa -90%-). This imbalance can be seen most clearly in the numerous countries that apply the The level of government responsible for French administrative model, where, in collecting the revenues also varies theory, there is a more diversified local between countries: in some locations the taxation system, yet in practice, local gov- municipalities ensure the collection of ernments remain devoid of taxing powers, taxes, while in others the state collects as tax rates are set out in the law or the taxes and later distributes the rev- imposed by central government. Local enues among local governments. African governments do not administer local taxa- francophone tax revenue systems are tion systems as such, rather they depend generally centralized, although some on taxes transferred from the state, which duties may be collected locally (e.g. Mali, in some cases have become state-shared Morocco, Senegal) and some countries taxes (e.g. Côte d'Ivoire, Cameroon). The may present certain exceptions to this taxing powers of local governments in rule (as is the case in Tunisia for the col- Gabon, Niger and Togo are the exception lection of certain taxes). However, to this tendency. Except for local govern- regardless of the system in place the tax ments in Senegal, local governments are collection rates remain low in all the also not empowered to set service fees countries: approximately 50% in Kenya; and tariffs. Only in exceptional instances lower still in Nigeria; 20% of real estate can local governments collect duties on taxes in Tunisia (collected at the local certain local services or activities (as in level); and between 45-50% on average Togo, for example) with the prior approval in Côte d'Ivoire or Níger (where the state of the overseeing state authority. ensures the collection of revenues). Local governments in anglophone countries The use of a shared tax system is slowly generally enjoy broader taxing powers and spreading as the main source of local greater freedom to set service rates and government budget funding. Value Added other indirect local tariffs; such as real es- Tax (VAT) is a major component of AFRICA Decentralization and Local Democracy in the World 39 shared taxation. VAT has been estab- The principles of intergovernmental lished in almost all countries, and is transfers are sometimes listed in the divided between the state and local gov- Constitution (including procedures and ernments in proportions that vary from calculating criteria). For instance, the one country to another. In Morocco, for Ghanaian Constitution envisages the example, local governments have been existence of the District Assemblies Com- receiving 30% of the revenue since mon Fund, which should receive 5% of 1986, and about 25% in Nigeria. In the total national revenue, to be distrib- Mozambique, 75% of the vehicle tax and uted among the districts through a for- 30% of the tourist tax goes to the local governments. In Cape Verde, there is a set of unallocated taxes, and local gov- ernments receive 7% of that revenue. The two most pressing problems arising However, in most countries the central administration from this tax system management are the terms of the division, which are often has discretionary decision-making power; very unfavorable to local governments, the state may take years to pay the agreed-upon and the regularity of payments. The manner in which the share allocated to share to the local governments local governments is distributed varies considerably. In some countries, there are legal rules about the timing and amount of fund transfers. However, in most countries the central administration has discretionary decision-making mula approved by Parliament (art. 252). power; the state may take years to pay This is a unique case. Apart from practi- the agreed-upon share to the local gov- cal difficulties, this system has increased ernments. Typically, the local authorities the financial dependency of local govern- have no legal recourse to counter such ments on central government. The 1999 delays. Over and above these difficulties, Constitution in Nigeria provides that at shared tax systems cannot be considered least 13% of the country's revenue to be own revenues, as local govern- accruing to the Federation Account ments hold no power over setting the tax derived from natural resources should be base and rate; these resources, from distributed among the states, based on a both a political and economic point of sharing formula that takes the principle view, are similar to general transfers. of origin into account (in relation to the volume of production of each state). It is III.2.2. State financial transfers up to each state legislature to determine to local governments the amount of resources that will be dis- tributed among local governments, and Grants are organized in many ways, and to institute a joint account between the also vary from country to country. Simi- Federation and the state where Federa- larly, the process of transferring grant tion and state contributions for local gov- funds varies. In general, transfers can be ernment transfers are deposited (art. unconditional (local governments are 162). With no direct constitutional safe- given free use of revenues), or conditional, guards over the volume of revenues ear- in which case central government transfers marked for local government transfers, are either based on pre-established objec- the Federation decided to make direct tive criteria or have a certain margin of transfers to local governments and allo- discretion (for local spending). cated a portion of VAT for this purpose. AFRICA 40 Decentralization and Local Democracy in the World Figure 1 Local Resources/GDP 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00 a a Benin asoFa na voireI'de aliM geriN ogoT enegalS Gha fricAh abwe Ugand Burkin Côt outS imbZ Source: (i) Regard sur les finances locales dans les pays de l'UEMOA (2001-2004) ; ( ii) NALAD, Fiscal Decentralization and Sub-National Government Finance; (iii) Fiscal decentralization in South Africa, Ismail Momaniat. The figure shows that, in most countries, local government finance represents less than 1% of GDP and 5% of state-level (sub-national) expenditure. Sometimes the law provides a formula for years). While province finances depend grant allocation. One of the best examples essentially on transfers, local government is that of South Africa governed by articles finances mainly rely on own-source rev- 213 and 214 of the Constitution. All money enues (taxes, tariffs and service charges). received by national government is paid into the National Revenue Fund (art. 213). The situation in other countries is a lot less The Division of Revenues Act provides favourable. The guarantees offered to local annually for the equitable distribution of governments to access revenues also vary revenue amongst national, provincial and from country to country. Sectoral grants are local spheres of government, and balanced routine in some countries, usually condi- division of tasks to be financed. The Act also tional or purpose specific. These grants are defines the distribution of revenues easily controlled but involve central govern- amongst the provinces (regions), and ment monitoring of local governments. This finally, sets the amount of conditional pur- is the case in Uganda and Zimbabwe. In pose-specific grants for provinces and local Tanzania the government is likely to intro- governments, financed through the fund. duce calculation of grant amounts on the The division of these grants are regulated basis of fixed formulas. In Zambia, central by formulas that are also defined by law. government also transfers funds through Paragraph 2 of Article 214 in the Constitu- sectoral grants that are not calculated tion contains the criteria to be applied to the through a set formula; these transfers rep- revenue-sharing formula amongst local resent only 3% of local budgets. In a sec- governments and provinces (in principle, ond group of countries, central government the structure is determined every five transfers mainly consist of general dis- AFRICA Decentralization and Local Democracy in the World 41 bursements to local governments for oper- the experience of decentralization in 30 ations or transferred functions, while African countries revealed that expenditure investments are covered by occasional controlled by local governments is around grants. Global transfers offer local govern- 10% in South Africa, between 5 and 10% in ments more freedom over spending, though Nigeria, Uganda and Zimbabwe and the allocation criteria are usually vague, as between 3 and 5% in Kenya, Ghana, Sene- in the case of Algeria, Tunisia, Gabon, gal, Mozambique and Zambia. Generally Guinea, Côte d'Ivoire, Senegal and also in speaking, the average ratio between local Kenya (where the global transfers are com- expenditure and national budget resources bined with a sectoral grant for road works). excluding donations is below 5% and the In Algeria, the allocation of the solidarity ratio between local expenditure and gross fund grant (95% of the resources from this domestic product (GDP) less than 1%. fund) is managed with clear eligibility crite- ria: for communities where wealth indices In addition, with the exception of South are lower than the national average. Finally, Africa and North Africa, local governments' there are countries that do not have an resort to borrowing in other countries is at organized system of transfers: in Niger and a very early stage. Togo, intergovernmental transfers are inter- mittent and dependent on the political situ- In view of the weakness of their own in- ation. Similarly, particularly in UEMOA come (the insufficient flow of intergovern- (West Africa Economic and Monetary Union) mental transfers is further exacerbated by and CEMAC (Economic and Monetary Com- the allocation modalities and constraints munity of Central Africa) countries, govern- on access to loan markets), it cannot be ments are often resistent to decentralizing denied that African local governments will the financial resources in keeping with the have trouble in meeting on their own the sectoral policies that absorb, even so, large costs of their ordinary activities and the flows of aid and public investment. transferred powers, not to mention their responsibilities in local development and III.2.3. The financial weight combating poverty. of local governments One of the explicative factors is that own Two indicators usefully measure the finan- tax revenue and local finance depend on the cial significance of local government: the macroeconomic framework ­and central share of the nation's Gross Domestic Prod- governments in sub-Saharan Africa face uct (GDP) allotted for local authorities, and severe financial constraints. The poverty the actual amount of money that comes affecting large segments of the population under the control of local governments. Fig- places limits on the tax take. On top of this ure 1 (p. 40) shows the actual financial comes the frequent lack of political will to weight of local governments. The sample is redistribute the tax to ensure a better sup- small because reliable data were available port to local governments and more effec- only for certain years in certain countries. tive management of the fiscal chain par- Even so, this sample of countries at differ- ticularly in the collection of taxes. One of ent levels of development is quite represen- the top priority claims of elected bodies is a tative. better distribution of resources, with the aim of taking the share of own tax revenues In the UEMOA countries (West Africa Eco- in relation to GDP to 2% and increasing nomic and Monetary Union), total municipal financial transfers by 5 to 10%, which expenditure of the area amounted to FCFA would make it possible to double or even 150 billion (228 million) in 2004, i.e. 4.8% triple local resources, the current level of of State expenditure of around FCFA 3103 which jeopardizes the positive fallout billion (4.7 billion). A World Bank study on expected from decentralization. AFRICA 42 Decentralization and Local Democracy in the World The weak financial capacity is exacerbated Remedies proposed to date fall into one of by persistent limitations and failings in two categories: capacity-building within administrative capacities and human re- local governments themselves, and trans- sources. ferring state personnel to local govern- ments. III.3. Administrative Capacity Table 4 illustrates the position. III.3.1. Human resources III.3.2. Existence and level of training The advent of decentralization has revealed of the principal municipal officials a shortage of trained personnel in African countries, all of which lack qualified staff in Most local governments need a minimum local administrations. This dearth of trained team to assist the mayor with his or her personnel makes it all the more difficult for functions. This administrative core is made local governments to handle additional up of the secretary-general for general powers transferred to or granted them. administrative and personnel management, the director of technical services, and the Some countries such as Morocco and Mali director of financial services. Municipalities have opted to establish a territorial civil service, in the major urban centers typically have such a team, or the means to recruit it. with the aim of making local jobs look more attractive The financial weakness of municipalities and of conferring on local government staff all results in weaknesses in human resources the advantages granted to state civil servants. and management skills in local government. This is a severe drawback for the implemen- A lack of information about the qualifica- tationofdecentralizationpolicies.Strengthening tions of local government staff members project management capacities of local precludes a comprehensive accounting of government should be a crucial part of all staff numbers and skills. Still, data provided decentralization support programs. by several countries provide an instructive sample. Data from Benin, Côte d'Ivoire, III.3.3. Status of local government Morocco, Senegal and Tunisia show a very personnel low percentage of the population holding staff positions in local government. In these The most common method for addressing countries, the percentage of citizens in all this shortfall of personnel is to transfer state levels of government ranges from 0.49% to senior civil servants to local governments 3.11%. At the local level it varies from by secondment or by granting leave of 0.012% to 0.46%: below one staff member absence. Consequently, in many countries per 100 inhabitants. For the countries pro- the mayor's technical team is comprised of viding data the percentages are: senior officials drawn from the state. · Benin: 0.49% at the national level, Some countries, such as Morocco and Mali, 0.012% at the local level. have established a territorial civil service with · Côte d'Ivoire: 0.69% at the national the aim of making local jobs look more attrac- level, 0.029% at the local level. tive, and of conferring on local government · Senegal: 0.73% at the national level, staff all the advantages granted to state civil 0.06% at the local level. servants. This strategy is designed to stimu- · Morocco: 1.7% at the national level, late interest in local jobs that are perceived as about 0.46% at the local level. second-rate positions. In many countries, · Tunisia: 3.86% at the national level, state civil servants regard appointment to 0.2% at the local level. local jobs as a punishment or a disgrace. Table 4 Human Resource Situation COUNTRY Number of state Number of local Level of qualification Legal system (public or private Recruitment procedure Existing training civil servants government staff law, or mixed system)/ career (especially for higher positions) programmes job positions Benin 32,882 (1995) 4000 from which 94% are 7% qualified for conceptual and Mixed legal system Former employees of the prefectures There is no specialist institution for support staff and 6% belong supervisory work. The remainder redirected to communes training local officials to management. at average level. Côte d'Ivoire 112,707 (1994) 47,325 Category A4 Mixed system. Governed by the The line ministry appoints public Training is organized by development (engineers, administrators) service regulations for public employees. For other officials, each partners. Moreover, each commune Category B3 employees and the law establishing commune follows its own recruitment organizes its own training plan. There (administrative secretaries, service regulations for territorial policy depending on analysis of the is no training initiated by the line senior technicians, bookkeepers) authority staff in the case of public function and needs expressed. ministry. employees and the labour code plus the law establishing service regulations for territorial authority staff in the case of other officials. Morocco 537,166 145,736 Senior management: 12,109 Public and private law (employment Competitive examination ­ Regional training centres/Training Middle management: 25,020 contracts) secondment - automatic division of the Ministry of the Junior staff: 31,382 appointment by Ministry Interior/Elected local officials' Decentrali Manual workers: 76,982 of the Interior initiatives Other: 223 AFRI zationan Senegal 71,694 (2004) 6846 Approx. 3% senior officials / Public law for seconded State Commune staff recruited at the Ad hoc training programmes 4% middle management employees and private law for staff discretion of the local authorities depending on support from + 90% backup and support staff recruited by local governments development partners dLocal Tunisia 390,000 including 25,000 including 54 % managerial staff, including 70% Public Competitive examination - initial training at training centres Dem 80,000 manual 18,000 manual workers male and 30% female or applications or qualifications approved by the administration workers 26% junior staff - graduates of approved - further training training centres - ongoing training to achieve ocracyin promotion - advanced training courses CA - missions abroad theWorld 43 AFRICA 44 Decentralization and Local Democracy in the World Various Even secondment and other stop-gap parliamentary, presidential or central strategies must be considered partial, government levels. And indeed, the lively mechanisms have short-term solutions. The essential issue turnover of power increasingly seen in been tried to bring is the lack of financial resources to pay local elections remains almost unthink- for qualified, high-level staff in local gov- able at top government levels in the local ernments. majority of African nations. people and The financial weakness of local govern- Participatory democracy can be fostered community ments leads inevitably to weak human only if the cultural bedrock already favors organizations into resources and limited management consultation, debate and participation in capacity --both are grave handicaps in collective decision-making. In this regard local public implementing decentralization policies in the picture in Africa is mixed, with sub- Africa. Building local government project stantial progress in many countries but management, management capacity should therefore no movement in others, the latter includ- ranging from be one of the priorities in all measures ing Egypt, Togo, Tunisia, Central African supporting decentralization and better Republic and Chad. Overall gains in publicizing the local government in Africa. transparency and accountability remain meetings fragile. of local IV. Local Democracy The first indicator of progress is the con- government sensus regarding universal suffrage. Not The following table gives a picture of local only has the principle of election become bodies, required by democracy in each country. widely accepted for local offices, but law in many African local elections are also being held IV.1. Local Political System with a regularity unprecedented in the countries, to history of Africa4. various types of When putting democracy into practice at the community level, local governments Another indicator regards the possibility debates and often face the same difficulties as mod- of holding several local mandates at the consultation ern state systems --a variety of local, same time, or holding a local mandate tribal and family loyalties and traditions alongside a national one. This is highly between those that influence civic behavior. For exam- restricted and may even be entirely for- ple, there may be a tendency to reject bidden. In most countries political parties bodies and local the notion that "people from outside" continue to monopolize local and national people might have a right to stand for election politics, but many countries do allow locally "when they are not from around independent candidates in local elections. here". In other places, such as Senegal, Those nations include Mozambique, Be- electoral law requires candidates to have nin, South Africa and Mauritania. In Gha- party affiliation in local elections. This na political parties are excluded from affiliation with established parties local elections entirely; the list is open increases the risk that standing for elec- only to independent candidates. 4. For instance, with tion will have more to do with national the exception of Mali, party politics than with the needs and IV.2.CitizenParticipation where elections have preferences of local voters. Despite such been postponed, the difficulties, local democracy has made Signs of progress toward representative electoral timetable undeniable progress. In many countries, democracy include publicizing official has been respected one sign of increased vitality is an meetings and encouraging local people over the last three years in Burkina increase in turnover of municipal teams and community organizations to take part Faso, Niger, Guinea, from one local election to another. This in open discussion of local issues. For South Africa and turnover is apparent even in countries example, in Zambia, residents are Mozambique. where change in political power is rare at involved in the implementation of certain Table 5 Portrait of Local Democracy in Each Country Country MUNICIPAL COUNCIL LOCAL EXECUTIVE DIRECT Voting system Term of Rounds of Method of Terms of Mayor Collegiate Rounds of Vote of no DEMOCRACY (majority/ office voting appointment office voting confidence proportional /removal or mixed) from office Benin Mixed(majority 5years 2rounds Indirect 5years No Yes Several Yes No andproportional) Cameroon Mixed(majority 5years 1round Indirect 5years No Yes 2fortheMayor Yes No andproportional) and1fordeputies Egypt,ArabRep.of RelativeMajority 4years 1round Nomination No No Gabon Proportional 5years 1round Indirect 5years No Yes Yes No Ghana Majority 4years 1round Indirect 4years No Yes Guinea Majority 5years 1round Indirect 5years Yes No Côted'Ivoire Majority 5years 2rounds Indirect 5years No Yes Yes No Kenya 5years 1round Indirect Decentrali Madagascar 4years Direct 4years AFRI Mali Majority Indirect No Yes Yes No zationan Morocco Majority 6years 1round Indirect 6years No Yes Yes No dLoc Mozambique Proportional 5years 2rounds Direct 5years Yes 2rounds No No al Niger Proportional 5years 1round Indirect 5years No Yes Yes No Dem oc Nigeria Majority 3years 1round Direct 4years No Yes No Senegal Mixed(Majority/ racyin Proportionalormixed) 5years 1round Indirect 5years Yes No Yes No CA SouthAfrica Proportional 6years 1round Indirect 6years No Yes 1round No Tanzania 5years Indirect 5years No Yes theWorld Tunisia Mixed 5years 1round Indirect Yes Yes 1round No No (predominantlymajority) Uganda 4years 1round Direct 4years Yes Yes 1round 45 Zambia Mixed 5years 1round Direct 5years Yes No 1round No AFRICA 46 Decentralization and Local Democracy in the World development projects in basic service down, making it more a tool used by sectors, such as health and education. central government to control territory In Uganda, participation sometimes and urban populations and ensure the extends as far as cooperation agreements continuity of its own structures and pol- between the municipality and civil society icy than a framework for teaching and associations; the latter are given empowering residents with the goal of responsibility for running a project or for strengthening independent local govern- monitoring and evaluating such projects. ments. In some municipalities of Benin, Burkina Faso, Mali and Mozambique, elected offi- Consequently, despite constitutional or cials increasingly use community radio to legislative provisions and safeguards, keep in touch with the local population the autonomy of local governments is and continue exchanging views with them restricted by central government over- about local development issues. These sight of local government bodies and exchanges provide an opportunity for their actions. However, positive develop- community and religious leaders, teach- ments can be seen in many countries ers and civil society activists to play a role towards slackening controls and refocus- in guiding local people, and in improving ing them on legal aspects. communication between officials and res- idents. To make local government bodies Local administration in Africa rests more representative, countries such as essentially on two political pillars: a Ghana and Niger, Uganda and South deliberative body, the council, and an Africa have been developing instruments executive body comprised of a mayor to bring social, economic, or cultural assisted by one or more deputies. Such forces into local councils, ensuring that all local bodies exercise their functions sociological components of the local com- under the control of the state. These fea- munity are involved in the local gover- tures are the norm in all African countries nance system. where decentralization is on the agenda. The differences lie in the way local bod- To ensure the representation of women, ies are appointed, and the degree of several countries have set quotas by law. freedom allowed by the state, which con- In Niger, at least 10% of seats on local trols local government bodies and their councils are reserved by law for female actions. In West and Central Africa, state candidates. In Mozambique, the represen- oversight of local governments is being tation of women within local bodies has relaxed. However, in North Africa central risen from 23% after the 1999 elections to control over all the activities of local gov- 28% in 2004. South African legislation ernments persists with little change. For- favors a minimum of 50% female candi- mer colonial systems of centralized con- dates on competing lists. In Uganda, the trol are giving way to models modified by law requires that at least one third of local independent governments. This is a pos- council seats should be occupied by itive development in principle even women. Women are not, however, the only though important matters such as budg- demographic group whose specific repre- ets and land allocation are still subject to sentation is promoted by decentralization. old, colonial-style control. Neither is jurisdictional control properly organized. IV.3. Relationship between Central and Decentralized Government Regarding the transparency of local ma- Authorities nagement and accountability, many countries have enshrined classic control In the majority of African countries, mechanisms in formal statutes. In such decentralization was imposed from the top cases, councils adopt budgets and re- AFRICA Decentralization and Local Democracy in the World 47 view and approve executive bodies' ad- · Defending and promoting the interests ministrative and management accounts. of their members. These accounts must also be approved by supervisory authorities. In some LGAs provide a platform for exchanging countries, specialist institutions, such as views and discovering opportunities for the Committee on Local Government and members. Their aim is to promote decen- Chiefs' Affairs in Zambia, monitor and tralization by lobbying the state as well as oversee local government management. international development partners. In In Uganda, the amounts of financial many countries, they help to implement transfers from central to local govern- decentralization by bringing the point of ment, as well as the local development view of local officials to the attention of sectors for which the funds are intended, higher government in reports and propos- are made public. The government then als. encourages local people to ensure that the transferred amounts are used prop- However, LGAs also experience resource erly. More than that, the web site of the constraints in many countries. They have ministry for local government provides a to rely on contributions from their mem- public forum for discussion; citizens are bers to cover costs. The uncertainty of encouraged to state their opinions on such resources necessarily limits the scope any aspect of local authority manage- of the LGA's efforts. ment. In eastern and southern Africa, LGAs are However, in some countries, there is a genuine administrative bodies, but some in large gap between legal procedures and West Africa and Central Africa have no methods of operation in practice. office or permanent staff. Where resources are minimal, LGAs are less effective in IV.4. Role of Local Government implementing decentralization. Associations Regional LGAs have also been set up in Establishing associations of elected local Central, East and Southern Africa. Some of bodies, often called Local Government these regional organizations are more Associations, (LGAs) has become the effective than others. For example, The method of choice for advancing the mutual Association of Central African Mayors interests of local governments in Africa. (AMAC) presently exists in name only, but Such associations exist in almost all coun- the association of East African local gov- tries on the continent. Membership may be ernments is comparatively dynamic, offer- restricted to mayors and deputy mayors, ing a regional platform for exchanges the municipal executive, or the local between elected officials from member authority as an institution. countries.5 LGAs may sometimes be set up in accord IV.4.1. United Cities and Local with categories of local government (com- Governments of Africa (UCLGA) munes and cities, regions, rural communi- 5. The East Africa ties) and typically have a three-fold The organization known as United Cities representative on charge: and Local Governments of Africa (UCLGA) the UCLGA executive is the Pan-African local government organ- committee was · Representing member authorities ization. The UCLGA represents a combina- appointed during an speaking with a united voice, tion of three African local government extraordinary organizations previously divided along lin- meeting of that · Providing capacity-building services to guistic lines: the African Union of Local association, held in local governments, Authorities (AULA) for local governments Kigali (Rwanda). AFRICA 48 Decentralization and Local Democracy in the World The UCLGA represents all local governments in ministers decided to move the decen- tralization process forward in Africa by set- Africa and seeks recognition from the African Union ting up a political body at continental level as the voice of African local governments within known as the African Conference on De- centralization and Local Development the Pan-African organization (CADDEL). At that meeting, proponents of decentral- from anglophone countries, the Union des ization expressed the wish that the African Villes Africaines (UVA) for francophone Union should be the reference body for the countries and the União dos ciudades y Ca- new platform. pitaes Lusofono Africana (UCCLA) for Por- tuguese-speaking countries. They set CADDEL the following objectives: This initiative reflects a recognition of in- · Persuade governments to list decentral- creasing globalization, a comparatively ization among their priorities and push new phenomenon that cannot fail to affect for greater awareness on the part of local governments.6 The UCLGA founding both leaders and citizens of the central congress took place in Tshwane in May role played by decentralization in the 2005, marking the starting point of the economic development process; unified African municipal movement. The UCLGA represents all local governments in · Keep decentralization and local devel- Africa and seeks recognition from the opment on the national policy agendas African Union as the voice of African local of member states, and at continental governments within the Pan-African organ- level within the African Union; ization. · Make sure that African states maintain IV.4.2. African Conference on their commitment to the decentraliza- Decentralization and Local tion process; Development (CADDEL) · Act as liaison between the organization In the spirit of African unity, African minis- of African local government associa- ters set up a Pan-African platform for dis- tions and their central governments for cussion and sharing experience on de- all issues involving decentralization and centralization and local development in local development; Africa. · Mobilize resources from development Meeting in Windhoek, Namibia, at the se- partners in order to implement decen- cond Africités summit in May 2000, African tralization and local development pro- Ministers for Decentralization and finance grammes. 6. The first Pan-African summit "Africities" took place in Abidjan (Côte d'Ivoire) in 1998, gathering together various African municipal unions. During the 2nd Africities summit organized in Windhoek (Namibia) in 2000, the three main municipal organizations agreed upon the creation of an African Union of Cities. In 2003 a first founding assembly took place, during the 3rd Africities summit, in Yaoundé (Cameroon). The common declaration of Yaoundé was adopted with the following principles: · to promote to local authorities of Africa the founding congress of the association "United Cities and Local Governments" · to set up the statutes of the new Pan-African organization · to decide on the definitive name of the organization and prepare its founding congress. AFRICA Decentralization and Local Democracy in the World 49 V. Conclusion This overall picture of decentralization and Difficulties remain within states concerning local democracy in African countries shows the transfer of financial resources needed significant progress at the strictly institu- to match the devolved responsibilities. tional level. No country now publicly Local governments also face difficulties in opposes the implementation of decentral- increasing their own resources (aside from ization policies. Local governments exist in state-transfers and grants) at a faster all countries, and elections are held to pace. Ensuring the availability of qualified elect local authorities human resources at the local level and improving public access to local services Not only are there more local governments are also fundamental issues of concern. covering ever-increasing areas, but the qualitative development of decentraliza- Tangible progress needs to be made in two tion can also be observed in the form of key areas: the transfer of responsibilities, more self-government and progress with adequate human and financial toward local democracy in more African resources, and entrenching a culture of cit- nations. This trend is accompanied by an izen participation, transparency and unprecedented increase in the responsibil- accountability. These areas of complicated ities of local governments throughout most yet indispensable reform are crucial for of the continent. progress to be sustained, and for its inher- ent democratizing ideas to take root. To The extent of such progress must, how- this end it is essential that all involved par- ever, be set against a number of persistent ties continue to mobilize high-level political obstacles that continue to hinder a real commitment at both national and Pan- progression of decentralization in Africa. African levels. ASIA-PACIFIC ANDREW NICKSON NICK DEVAS ALEX B. BRILLANTES WILHELMINA L. CABO ALICE CELESTINO1 ASIA-PACIFIC 52 Decentralization and Local Democracy in the World 1. The final draft has been worked out by Andrew Nickson. The authors gratefully acknowledge the valuable research assistance provided by Mr. Jose Tiu Sanco, Ms. Frances Fatima Cabana and Mr. Prejean Prieto, research staff at the National College of Public Administration and Governance, University of the Philippines. ASIA-PACIFIC Decentralization and Local Democracy in the World 53 I. Introduction living standards in the world during the period 1950-2000. The Asia-Pacific region comprises an enormous variety in the size of nation The Asia-Pacific region also embodies states. This ranges from the two demo- great diversity of historical experience. graphic giants of the world, China and In- Many of the countries incorporated colo- dia, which together account for one-third nial models of governance to a greater or of global population, to the many island lesser extent - British, in the case of Aus- states of the Pacific that have less than tralia, New Zealand, India, Pakistan, Sri 100,000 inhabitants. The region also dis- Lanka, Malaysia and some of the Pacific plays a great variety in living standards, islands, French in the case of Vietnam, ranging from the high-income OECD Cambodia and Laos (but largely super- countries of Australia, Japan, Republic of seded by communist models in these Korea and New Zealand to a number of countries), Dutch in the case of Indonesia the least-developed countries of the and US in the case of the Philippines. world, including Bangladesh and Nepal. Recent laws in Pakistan also reflect US, It also includes some of the currently German and Japanese influences. The fastest growing economies in the world, single-party communist system adopted notably China, India and Vietnam, as by China, Laos, North Korea and Vietnam well as the country ­ Korea ­ that has owes much to the Marxist-Leninist ideol- experienced the most dramatic growth in ogy of the former Soviet Union. Table 1 Basic Development Indicators in the Asia-Pacific Region, 2004 Country Population Density People % Urban GNP per HDI (millions) per sq. km Population* head (US$) Ranking Australia 20.1 3 88.2 26,900 3 China 1,296.5 139 40.4 1,290 81 India 1,079.7 363 28.7 620 126 Indonesia 217.6 120 48.1 1,140 108 Japan 127.8 351 65.8 37,180 7 Malaysia 25.2 77 67.3 4,650 61 New Zealand 4.1 15 86.2 20,310 20 Pakistan 152.1 197 34.9 600 134 Philippines 83.0 278 62.7 1,170 84 Korea, Rep. of 48.1 488 80.8 13,980 26 Thailand 62.4 122 32.3 2,540 74 Vietnam 82.2 252 26.4 550 109 Source: World Bank 2006; UNDESA 2006; UNDP 2006a. * Data is for 2005. ASIA-PACIFIC 54 Decentralization and Local Democracy in the World This chapter reviews the results of twelve and Pakistan. The enormous size of China country case studies of decentralization means that, although it is a unitary state, and local democracy from the region: there is a considerable diversity of practice Australia, China, India, Indonesia, among provinces. To a lesser extent, this Japan, Malaysia, New Zealand, Pakistan, is also true in Indonesia. Philippines, Korea, Thailand and Viet- nam (Table 1). The sample reflects the more developed and faster growing na- II. Territorial Organization tions of the region but also those where there is a more active program of decen- II.1. Delineating Local Governments tralization, albeit of widely varying pat- terns. The chapter draws on other pu- While local governments are generally un- blished material on these countries as derstood as units of government respon- well as the authors' own knowledge of the sible for providing direct services to in- region. habitants in a given territorial jurisdiction, The term `local their classification and location in the sub- The Asia-Pacific region embraces the national government vary across the Asia- government' is most highly developed features of global Pacific countries. The term `local go- generically used urbanization and already contains 23 of vernment' is generically used in all the 40 largest metropolitan areas in the countries to refer to these sub-state/sub-pro- in all countries world (Table 2). Of the top 100 metropol- vincial units. In a few countries, other to refer to itan areas, China has 15 (with a combined terms are used such as `councils' in Aus- population of 96.2m), India has 9 (with a tralia and New Zealand, and district sub-state/ combined population of 80.1m) and administration in Malaysia. In Japan, the sub-provincial Japan has 3 (with a combined population preferred term is `local autonomy' to of 49.1m). indicate freedom from central control in units making decisions and self-responsibility in With such a diversity of population size, managing local affairs. Depending on pop- per capita income, historical experience ulation size, income and location, local and political system, it is not surprising governments in the region are variously that models of decentralization and sub- categorized as wards, districts, com- national governance should also vary munes, shires, counties, municipalities, considerably. As a result of this lack of cities, prefectures and provinces. And homogeneity, it is both difficult and ques- although all these forms are generally con- tionable to make sweeping generalizations sidered local governments, their classifica- about the Asia-Pacific region as a whole. In tion also varies such that a municipal unit fact, the recent experience of decentraliza- in one country (Indonesia) may be much tion and local democracy in the region has bigger than an intermediate local govern- been quite diverse. Nevertheless, there ment unit in another one (for example a are some common themes and issues province in the Philippines or Vietnam). across the region, which are addressed in this chapter. Four of the sample countries In federal countries like Australia, India, ­Australia, India, Malaysia and Pakistan­ Malaysia and Pakistan, local governments have federal systems of government that in general comprise the lowest level of accord states a greater or lesser degree of government. In these countries, local go- autonomy. Since, within a federal system, vernments are a function of the intermedi- local government is generally a state mat- ate level of government such as the states ter, this can produce a wide diversity of in Australia, India and Malaysia and practice within a country with regard to provinces in Pakistan. While there may be local governance. This is certainly true in some general provisions in federal consti- Australia and India but less so in Malaysia tutions concerning local governments, as ASIA-PACIFIC Decentralization and Local Democracy in the World 55 Table 2 Global Ranking of Metropolitan Areas in the Asia-Pacific Region Rank Name English name Country Population Remarks 1 Tokyo Tokyo Japan 33,600,000 (GreaterTokyoArea)incl.Yokohama,Kawasaki,Saitama 2 Seoul (Soul) Seoul Korea 23,400,000 incl. Bucheon, Goyang, Incheon, Seongnam, Suweon 5 Mumbai Bombay India 21,600,000 incl. Bhiwandi, Kalyan, Thane, Ulhasnagar 6 Delhi Delhi India 21,500,000 (National Capital Territory) incl. Faridabad, Ghaziabad 9 Shanghai Shanghai China 17,500,000 10 Osaka Osaka Japan 16,700,000 (Osaka Metropolitan Area) incl. Kobe, Kyoto 12 Kolkata Calcutta India 15,700,000 (Kolkata Metropolitan Area) incl. Haora 13 Manila Manila Philippines 15,600,000 (Metro Manila) incl. Kalookan, Quezon City 14 Jakarta Jakarta Indonesia 15,100,000 (Jabotabek Metropolitan Area) incl. Tangerang 15 Karachi Karachi Pakistan 15,100,000 16 Guangzhou Canton China 14,700,000 incl. Foshan 19 Beijing Beijing China 12,800,000 20 Dhaka Dacca Bangladesh 12,600,000 28 Shenzhen Shenzhen China 9,150,000 29 Krung Thep Bangkok Thailand 8,650,000 30 Wuhan Wuhan China 8,650,000 33 Nagoya Nagoya Japan 8,250,000 36 Tianjin Tiensin China 8,000,000 37 Lahore Lahore Pakistan 7,950,000 38 Chennai Madras India 7,850,000 (Chennai Metropolitan Area) 40 Bangalore Bangalore India 7,350,000 (BMRDA) 41 Hyderabad Hyderabad India 7,150,000 43 Hong Kong (Xianggang) Hong Kong China 7,100,000 (S.A.R.) incl. Kowloon, Victoria 44 Taipei (T'ai-pei) Taipei Taiwan 6,700,000 (Taipei-Keelung Metropolitan Area) 46 Chongqing Chungking China 6,200,000 Source: The principal agglomerations of the World (2007-09-03). City population, http://citypopulation.de/World.html. ASIA-PACIFIC 56 Decentralization and Local Democracy in the World in the case of India and Malaysia, it is ge- moving to a less prescriptive approach in nerally left to the state or provincial gov- regard to the councils' roles and functions, ernment to determine the scope of local albeit subject to greater public accountabil- government in these countries. Thus, it is ity and stricter requirements for corporate not surprising that perceptible differences planning and reporting. The recent local in local government practices exist across government reforms, particularly the Local the federated states within the same coun- Government Act 2002, undertaken by New try. The system of election for local coun- Zealand have broadened the responsibilities cils in Australia, for example, varies from of local councils practically giving them the state to state. In India, fiscal and adminis- power of general competence. Philippine trative decentralization is unevenly imple- local governments have their powers and mented across the states compared with responsibilities specifically defined in the political decentralization, while local Local Government Code. Significantly, the democracy is also at varying levels of general welfare clause in the Code allows development across the Indian states. In local governments to do practically what- contrast, local government variation in Ma- ever they think will promote the well- being laysia and Pakistan is slight. of people and community, limited only by expressed prohibition of law. In any case, Each country of the Local governments in unitary states com- the scope of powers and functions assumed region has made prise the only sub-national layers of go- by local governments in the region varies vernment, thus putting local government from country to country, and even among significant strides directly under central government over- local governments within the same country. over the past sight. Theoretically speaking, unitary go- These practices had been shaped by the vernments may incline towards centralism respective country's historical traditions, several decades in and constrain local autonomy. The experi- and increasingly by political, economic and the creation of a ence in the region shows that this is not fiscal considerations as evidenced by the necessarily so. Robust local governments decentralization programs being imple- strengthened and local democracy exist in unitary sys- mented by countries in the region. In most institutional tems like Japan, New Zealand and Philip- countries, local governments perform wide- pines, as is also the case in federal Australia. ranging functions to address local needs framework China, though unitary, exhibits a variety of and promote economic and social well- in support of local government practices between being of citizens and local areas. The func- provinces owing to the sheer size of the tions of local governments in the region will decentralization country. This is true to a lesser extent in be discussed at length in Section III.1. Indonesia. II.2. Legal Framework Local governments in all countries exercise for Local Government powers by virtue of ultra vires. The powers, roles and responsibilities are set out in spe- The legal framework for local government in cific legislation or acts promulgated by the Asia-Pacific region is contained either in national or state level government, with national constitutions or in separate laws. some countries having more or fewer local Major local government legislation in the powers and functions assigned to them. selected countries is shown in Annex 1. Japan is markedly different on this as local Most countries recognize local government governments in this country operate on the in their constitutions as well as having sep- basis of the general competence principle. arate laws for local government. However, But as reforms continue to characterize local government in Australia is recognized intergovernmental relations in the Asia- not in the Commonwealth Constitution but Pacific countries, the political and func- in comprehensive Local Government Acts tional bases of local government continue to passed by individual state parliaments and be redefined. Australia, for instance, is in a few cases, references are also made in ASIA-PACIFIC Decentralization and Local Democracy in the World 57 state constitutions. In New Zealand, which constitution of 1946, followed by several has no consolidated constitution, local go- instances of legislation to decentralize vernment was greatly strengthened by (namely 1947, 1995-1999). national legislation in 2002 granting it gen- eral competence power in marked contrast Recent constitutions in the Philippines (1987, to previous restrictions imposed by ultra Article 10), the Republic of Korea (1987, Arti- vires. Despite not offering constitutional cles 117 and 118) and Thailand (1997, Arti- protection, local governments in both cle 78) all provide for local government countries enjoy substantial powers and autonomy, but the constitutions of China responsibilities that are not observed in and Vietnam (see on the contrary: China, several countries in the region that do pro- art.110; Vietnam: art.6). In the Philippines, the vide constitutionally for local government 1991 Republic Act (Law 7160)­also known autonomy. as the Local Government Code­ fleshed out the constitutional provisions concerning Each country of the region has made sig- the principle of decentralization and local nificant strides over the past several autonomy, transferring responsibility for the decades in the creation of a strengthened delivery of many basic services to local gov- institutional framework in support of ernment and thereby fundamentally altering decentralization. The framework is estab- central-local relations. In Korea the 1987 lished variously in the basic law of the land constitution (Article 117) states that local go- and in separate national and state statutes vernments "shall deal with matters pertain- and laws. This is the case whether a nation ing to the well-being of local residents, shall is a multi-party democracy, socialist country manage properties, and may establish their or military regime. Even when local self-go- own rules and regulations regarding local vernance is promoted as a national ob- autonomy as delegated by national laws and jective, central government still intervenes decrees." However, this constitutional provi- to introduce and sustain these reforms. sion remained unfulfilled until July 1995 Such was the case in India where the 1950 when the nation elected local government Constitution (Article 40) requires that mayors for the first time in more than 30 "...states shall take steps to organize vil- years. Until then local governments were lage panchayats and endow them with no more than local administrative dis- such powers and authority as may be nec- tricts of the central government. The essary to enable them to function as units heads of local governments (in effect, solely of local self-government," but left the leg- administrative authorities) were appointed islation of local self-government to the by the central government, and their capac- states. Because the implementation of pan- ity for autonomous decision-making was vir- chayats was uneven across the states, tually nonexistent. In Thailand the 1997 decentralization reforms were promoted constitution requires the promotion of by the 73rd and 74th constitutional decentralization as a basic policy of the gov- amendments in 1992. These require states ernment and this was followed by basic leg- 2. G. Rao / N. Singh to hold elections for local bodies and to islation in 1999 in the form of the Decentral- (2000), How to think transfer fiscal and administrative responsi- ization Plan and Procedures Act. As of June about local bility for certain services and functions to 2003, eight enabling laws had been pro- government reform in India? Incentives local government in both rural and urban posed in support of decentralization goals, and institutions, areas. As a result there has been a dra- four of which had been promulgated. More Berkeley, p.9; adde: matic improvement in local democracy in generally, more tasks does not mean more G. Sethi (ed.) many parts of India but the constitutional responsibility; in India the two higher tiers (2004), Fiscal requirements for administrative and fiscal of local government are considered to be decentralization to decentralization are still not complied with "implementing agencies of state govern- rural governments in to the same extent by all states. This is ment", also after the 1994 constitutional India, World Bank, also the case in Japan with article 92 of the amendments2. p.19 ASIA-PACIFIC 58 Decentralization and Local Democracy in the World Within the Indonesia provides the most dramatic exam- traditions of self-governance to organiza- Asia-Pacific region, ple of major legislative reform for enhanced tional forms imported through the colonial local government autonomy. The `big bang' experience and Marxist-Leninism. Traditions there has been a decentralization took place on the basis of of community or grassroots self-governance Regional Government Law 22 of 1999, which have long existed in the region, though not wide range eliminated the hierarchical relationship necessarily in the more sophisticated organi- of drivers between provincial and municipal govern- zational forms of local government that ments. This significantly shifted resources exist today. For example, in Korea, local gov- of decentralization and responsibilities from the central and ernment was founded on the basis of infor- and of obstacles to provincial levels to urban (kotamad-ya) and mal, voluntary organizations for the purpose rural (kabupaten) municipalities. Under of promoting mutual assistance among citi- such changes, but Regional Autonomy Law 32 of 2004 these zens as well as the strengthening of commu- decentralization district governments were assigned 11 oblig- nity ethics (Sproats 2003). In Japan tradi- atory functions while provincial governments tional customary institutions are still has generally been were given a secondary role. In line with functioning today in the form of an extensive driven from the top these expanded responsibilities a major shift network of voluntary neighborhood associa- of staff resources (about 2.5 million civil ser- tions that in practice operate as subcontrac- vants, of whom about three-quarters were tors of local government. In those countries teachers or health workers) took place from that came under foreign rule, these old the central and provincial governments to systems underwent a process of colonization the districts during a short transition period that subsequently shaped the forms of local (2000-2001). Law 33 on Fiscal Balance administration that are in operation today. between Central and Regional Government However, national independence encouraged in 1999 (later amended by Law 25 of 2004) countries such as India and the Philippines to provided a new intergovernmental fiscal restore their traditional systems of gover- framework for general allocation grants (DAU), nance, respectively known as panchayats which represent block grants to finance the and barangays, and to integrate them into administrative and other costs associated the formal system of local government. Dur- with newly decentralized functions (rather ing the immediate post-independence period than the earmarked grants of the past). in many countries, centralization was consid- Under the previous centralized system, social ered to be the most efficient way of achiev- and public service indicators of some major ing the goals of rebuilding national identity resource-producing regions were weak, and and attaining rapid economic growth. to redress this imbalance, these regions Notwithstanding, most of these countries were now provided with a share of the rev- subsequently initiated local government enues generated. Local governments were reforms as part of wider processes of also granted the power to levy their own improving public sector efficiency and taxes supported by regulations on the type democratization (Sproats 2003). of taxes and service charges permissible and maximum tariffs (ADB 2006b). However, to Within the Asia-Pacific region, there has been date the legal framework and division of a wide range of drivers of decentralization responsibilities among levels of government and of obstacles to such changes. In some remains unclear. parts of the world, notably in Latin America during the 1980s and 1990s and in Central II.3. Evolution of Local Government and Eastern Europe following the collapse of Structures the Soviet Union, there was a widespread demand from citizens for local democracy A great variety of historical experience has and for greater citizen control over local influenced the evolution of local government affairs. This has not generally been the case structures in the Asia-Pacific region, ranging in Asia, where decentralization has more from the intermarriage of longstanding local often been driven from the top. In the case ASIA-PACIFIC Decentralization and Local Democracy in the World 59 of China, decentralization has primarily been of Indonesia, which had long felt marginal- By contrast, the about economic reform, as part of the shift ized and were threatening to secede. recent and quite towards a market-based economy, and liber- ating the economic potential of regions and In some countries of the region there has radicalprograms localities, rather than political engagement been a noticeable cyclical movement to and of decentralization and local accountability. In Vietnam, the fro between periods of centralization and massive Doi Moi (renovation) process initi- decentralization. This has especially been inthePhilippines ated in the late 1990s was also primarily the case in Pakistan, where local govern- and Indonesia have about economic and administrative reform, ment reforms were introduced in 1960, including the devolution of management 1979 and 2001. The main objective of the been more overtly responsibilities. One feature of Doi Moi was 2001 reform was an attempt by the mili- linked to to encourage and legitimize citizen participa- tary government at the center to reinforce tion in local decision-making as well as to its legitimacy and gain popularity across `bottom-up' strengthen transparency and accountability the country. But the institutionalization of mechanisms at the commune level. In this local (non-party) political accountability processes sense, the creation of decentralized struc- has been thwarted to a significant degree of democratization tures and processes is a manifestation of a by the continuing provincial control over wider movement towards democratization in local government and the difficulty of the region as it provides the enabling context implementing the provisions for recall of for broader citizen participation in local gov- officials (Cheema et al 2006). This was ernance. also, to some extent, the case with earlier failed attempts at decentralization in By contrast, the recent and quite radical Bangladesh. In Thailand, communist insur- programs of decentralization in the Philip- gency during the 1970s and 1980s rein- pines and Indonesia have been more forced commitment to strong central con- overtly linked to `bottom-up' processes of trol. Only since the 1990s, and despite democratization. In the Philippines, the sub- strong opposition from the Ministry of Inte- stantial devolution of responsibilities and rior, have governments supported decen- resources to elected local governments was tralization. By contrast, in Bangladesh and part of the radical reform agenda of deep- Malaysia there has been resistance from ening political participation and bringing the center to any substantial decentraliza- political decision-making closer to citizens tion that would strengthen the political role following the 1986 overthrow of the Marcos of local government. Thus local govern- regime. Indonesia experienced one of the ment in these countries may be regarded most radical decentralization programs in as more akin to local administration. the world from 1999, shifting major func- tional responsibilities, resources and staff Decentralization is never a smooth to local governments. This was partly a process as there are many competing response to the highly centralized state interests at play, some of which resist under Suharto, which was blamed for many decentralization. Strong resistance can come of the ills of the country. Whilst this pro- from a central ministry that perceives that gram built on an existing structure of local decentralization erodes its powers and government, the reforms devolved sub- resources. For similar reasons, central stantial decision-making powers to what civil servants may resist decentralization, had previously been little more than a sys- especially when it involves their reassign- tem of deconcentrated local administration ment to a sub-national level of govern- (albeit referred to in earlier legislation as ment, as was the case for large numbers `local autonomy'). Nevertheless, the `big- of civil servants in Indonesia and Thai- bang' decentralization was also strongly land. Party political rivalry can also be a driven by the urgent need to satisfy the major obstacle, where parties position interests of the resource-rich outer islands themselves by opposing proposals for de- ASIA-PACIFIC 60 Decentralization and Local Democracy in the World There is a centralization. This is compounded by duced in the 1990s that increasingly rec- considerable political competition at sub-national lev- ognized the importance of local autonomy, els: ruling parties at the national level including the introduction of direct election variation in the may get cold feet about decentralization if for local government executives. As in they perceive that the opposition may Japan, they were largely driven from the Asia-Pacific region gain control of large numbers of the center. One writer has described the actual in both the number decentralized units. Three-way political practice of decentralization in Korea as a conflicts among union, state and local "curious mixture of deconcentration and of tiers of local governments in India were one of the devolution" (Seong 1998:13). A unique government and in main reasons for the 1992 constitutional feature of the process was the Saemaul amendments designed to protect the Undong, a community-based movement the average interests of local governments from established during the rule of President population size excessive state interference. Such political Park Chung Lee in the 1970s. Although conflicts continue to hamper effective de- these were mobilized `top-down' by central covered by local centralization in some Indian states. government, they eventually laid the foun- government dation for a variant of `citizen participation' Finally, the OECD countries in the region, that made a significant contribution to Ko- Australia, Japan, the Republic of Korea and rean rural development. New Zealand, also emphasize decentraliza- tion as part of their ongoing administrative II.4. Tiers and Size reform process. Australia, Japan and New of Local Governments Zealand have a long history of local go- vernment; so, recent experience here has There is a considerable variation in the been of relatively modest reform to deal Asia-Pacific region in both the number of with particular problems or changed cir- tiers of local government and in the aver- cumstances. A series of reforms to local age population size covered by local gov- government acts in all the states of Aus- ernment. The territorial organization of tralia expanded the general powers of local local government in selected countries is government during the 1990s. An Inter- presented in Table 3. Two of the four fed- Governmental Agreement in 2006 eral nations in the case study countries expanded local government responsibilities have a single tier of local government in the fields of planning, health, environ- below the state level (Australia and mental protection and cultural activities. In Malaysia) while Pakistan has a triple tier New Zealand, the Local Government Act of and India has a single tier in urban areas 2002 granted local and regional govern- and a single, double or triple tier in rural ment broad general powers. areas, depending on the state. Of the eight unitary nations in the sample, four have a In Japan, House and Diet Resolutions on two tier system of local government decentralization were passed in 1993 based (Indonesia, Japan, Thailand and New on the premise that the centralized admin- Zealand), while three others have a three istrative system was unable to cope with tier system (Philippines, Korea and Viet- rapid developments at the local level. In nam) and China has four subnational gov- 1995 a Law for the Promotion of Decen- ernment layers. Furthermore, what is a tralization was passed, in 1998 a Decen- local government tier is not always clear, tralization Promotion Plan was initiated especially when there is a combination of and in 2004 the Local Government Law of modern local government structures and of 1947 was amended to strengthen the traditional or customary institutions, as is administrative authority of cities. usual in a lot of countries of the region at the village level. Even the material evidence In the Republic of Korea, a series of decen- of such basic criteria as the exercise of pub- tralization laws and policies were intro- lic and budgetary power may be uncertain. ASIA-PACIFIC Decentralization and Local Democracy in the World 61 Table 3 Territorial Organization of Local Government in the Asia-Pacific Region Country Type of Type of Federated units, Regional / Upper level Lower level government state regions or territories provincial level of local of local with special rights government government Australia Costitutionalandparliamentary Federal 6statesand2territories SingleTier:703councilsvariouslydescribedascities, democracy(Governorgeneral municipalities,shiresordistrictswith7differentslocal representingtheQueenas authoritysystems.TheAustralianCapitalTerritory(ACT)of headof State,PrimeMinisteras Canberrahasitsownlocalgovernmentsystem chiefofgovernment) China Communiststate(President Unitary Notapplicable 1)Provinciallevel: District level: Townshiplevel: (2006)2 aschiefofstate,Premier 34units 2,860units 41,040units asheadofgovernment) -23Provinces, -1,463districts(xian) -14,119townships(xiang) -4largecitiesdirectly -369citieswithdistrictright -19,369boroughs(zhen) undercentralgovernment -856innercitydistricts -10jointtownshipboards -5autonomous*regions: inlargercities (qugongsuo) InnerMongolia,Guangxi -117autonomous*districts -6,355innercitywards Zhuang,Tibet,Ningxia (zizhixian) -1,088ethnictownships Hui, XinjiangUygur -49ethnicbanners(qi) (minzuxiang) -2specialadministrative -3autonomous*banners -98tribes(sumu) regions:Hong-Kong,Macao (zizhiqi) -1ethnictribe -2specialzones 2)Regionallevel:333units: -1forestzone -644,000villagecommittees -283citiesofregionallevel (85%ofvillages)and -17regions(diqu) 71,375urbanneighborhood -30autonomousprefectures committees(70%of (zizhizhou) neighborhoodcommunities- -3unions(meng) 2004)arenotlocalauthorities India ParliamentaryDemocracy Federal 28statesand *Urbanareas:SingleTier:3,694urbanmunicipalities (Presidentaschiefofstate, 7unionterritories *Ruralareas:Single,dual,ortripletiersdependingonstate, PrimeMinisterashead 246,977ruralcouncilscomprisingof: ofgovernment) -459zillapanchayats(district:thirdtier), -5,930panchayatsamitis(block:secondtier) -240,588grampanchayats(village:firsttier) Indonesia Republic,presidentialgovernment Unitary 2specialdistricts: 33provinces SingleTier:450units(2006) (Presidentisboththechiefofstate Aceh,Papua (includingspecialdistricts) -municipalities(urban):Kotamadya(2004:91) andheadofgovernment) CapitaldistrictJakarta -regencies(rural):Kabupaten(2004:349) -Villages(Desa):(pop.approx.70,000).Theirorganization and functioningaretheresponsabilityofthe provincialauthorities(lawnº22/1999). Japan ConstitutionalMonarchywitha Unitary Notapplicable 47prefectures 1,820municipalities. ParliamentaryGovernment 779citycouncils, (Emperoraschiefofstate, Prime 844towncouncilsand197villagecouncils Ministerasheadofgovernment) Malaysia ConstitutionalMonarchy Federal 13states 144localgovernmentunits(dependingonpopulation): (ParamountRuleraschiefofstate, 3federalterritories -10citycouncils, PrimeMinisterasheadofgovernment) -36municipalcouncilsforlargetowns -98districtcouncils(areaswithsmallurbancenters) 2. Data on China from: Quio Jing (2005). La réforme de l'administration chinesse face aux rites confucéens, Thesis, University Paris 1, Panthéon-Sorbonne. (P. 125) (unpublished). Updated by Dr. Qiao. ASIA-PACIFIC 62 Decentralization and Local Democracy in the World Table 3 Territorial Organization of Local Government in the Asia-Pacific Region (cont.) Country Type of Type Federated units, Regional / Upper level Lower level government of regions or territories provincial of local of local state with special rights level government government New Costitutionalandparliamentary Unitary Notapplicable 12RegionalCouncils 74TerritorialLocal Authorities(TLA)includingamongwhich: Zealand democracy(Governorgeneral 4unitarydistrictcouncils - 4unitarydistrictcouncils), representingtheQueenashead - 15citycouncils, of State,PrimeMinisteraschief - 54districtcouncils, headofgovernment) ChathamIslandsCouncilCommunityboards: createdbyTLAat theirdiscretion:150in2006in50%ofTLA Pakistan Republic,presidential Federal 4provinces 111districtunits 396sub-districtunits: 6,125unionadministrations government(Presidentas including: - Tehsilindistricts chiefofstate,PrimeMinister - Citydistricts: - TownMunicipal asheadofgovernment) - Large metropolitanareas Administration(TMA) - Federalcapitaldistrict incitydistricts (noself-government) Philippines Republic,presidentialgovernment, Unitary Autonomousregion 83provinces 120cities 41,982villages(barangays) (Presidentisboththechiefof ofMindanao 1501municipalities stateandheadofgovernment) Korea,Rep.of Republic,presidentialgovernment Unitary Specialautonomous 9provinces 230municipalunits: Lowermunicipalunits(wards): (Presidentisboththechiefof provinceofJeju 6metropolitancities Seoul:25 Dong(urban),Erp/Myeon stateandheadofgovernment Seoul(special Metropolitancities:49 (rural)differentiatedaccording metropolitancity) Provinces: topopulation:Eup=largerunit 75cities inruralareas(over50,000,Eup 81ruraldistricts maybecomeacity) Seoul:522Dong Metropolitancities:689Dong; 10Eup/36Myeon Provinces(incl.Jeju): 942Dong,213Eup,1,112Myeon Thailand Constitutionalmonarchy Unitary 75ProvincialAdministrative 1,129municipalities(citiesandboroughs) (Kingaschiefofstate,Prime organizations PattayaCityCouncil Ministerasheadofgovernment, BangkokMetropolitan 6,744Sub-district(tambon)AdministrativeOrganizations(rural) atpresentprovisionalmilitary Administration government) Vietnam Communistgovernment Unitary Notapplicable 59provinces 662districtunits,among 10,776municipalities: (Presidentaschiefofstate, 5centrallycontrolledcities which:25provincialtowns, 1,181wards(urbanareas) PrimeMinisterasheadofgovernment) (includingthecapitalcity) 42urbandistricts(in 583districttowns(rural centrallycontrolledcities), districtcentres) 9,012communes(lowerunits inurbanandruralareas) Source: UCLG Country Profiles (2007). * Autonomous areas means a special administrative regime based on the recognition of special rights for ethnic groups. ASIA-PACIFIC Decentralization and Local Democracy in the World 63 The average population size of local go- upper local level in countries with a two tier vernments in the region is shown in Ta- local level. Therefore, the upper level has to ble 4. The relevance of this ratio depends be taken for the comparison with countries very much on whether the lower tier is de- having a single tier local level. Convention- vised as a rather large jurisdiction adequate ally, we call it a district whatever its name to perform a number of functions, or in the respective countries. whether it is closer to settlements and has to maintain a link with the people. Both may This table is probably misleading in some exist in the same countries; then, the sig- respects. It overlooks the role of the nificance of the ratio depends on the distri- provincial state administration, with its bution of functions. We have indeed to take local branches in Thailand, which allows a in to account that some countries have a two higher degree of fragmentation. It under- tier local level (most Indian states, Pakistan, estimates the role for the people of lower Philippines, Korea, Vietnam), whereas oth- level municipal administrations, and its ers have only a single tier local level (Aus- value in terms of local democracy (for tralia, Indonesia, Japan, Malaysia), and example in India or the Philippines). How- exceptionally three tiers in some Indian ever, the high ranking of the ratio suggests states and in China. To make a comparison, decentralization at the meso level rather we have to take in to account the functions than at the local level (for example in of these levels. Indeed, major local govern- Indonesia, Pakistan and Korea), and a low ment functions are usually exercised at the profile at the municipal level. Table 4 Average Population Size of Local Governments in the Asia-Pacific Region Country Population (m) Number of local Average size of governments local government Australia 20.1 703 28,592 China 1,296.5 2,860 453,147 India 1,079.7 9,624 112,115 Indonesia 217.6 450 483,556 Japan 127.8 1,820 70,220 Malaysia 25.2 144 175,000 New Zealand 4.1 73 54,931 Pakistan 152.1 396 384,091 Philippines 83.0 1,621 51,300 Korea, Rep. of 48.1 230 209,010 Thailand 62.4 7,874 7,924 Vietnam 82.2 662 124,169 Source: Table 1 and Table 3. ASIA-PACIFIC 64 Decentralization and Local Democracy in the World The changing `shape' of territorial organi- the intermediate level. This is typical for zation in the region reflects two very dis- Chinese reforms: village committees are similar processes under way. In the high- directly elected in more than 644,000 Chi- income OECD case study countries, the nese villages every three years. The com- number of local governments has fallen in mittees deal with the lease of land and the recent years as a result of amalgamation management of local affairs; however, promoted by central government in pursuit main responsibilities are carried out at the of economies of scale in service delivery. province and county levels. The same In Australia, as a result of state policies, movement can be seen in Vietnam. The the number of local authorities diminished number of communes has increased by by 200 in the last 30 years. In Japan, an 265 units between 2000 and 2004. The amalgamation policy from 2001, encour- vitality of traditional village institutions is aged by the central government to capture supported by the government and some these scale economies, reduced the num- administrative tasks can be delegated to ber of local governments from 3,229 to them by the people's committee of the 1,820. In New Zealand, a major territorial commune. Even so, the key levels of local reform in 1989 dramatically reduced the government are provinces and districts. number of local governments from 830 by Similar trends can be observed in the non- creating an upper tier of 12 regions in communist countries. For example, the addition to 74 lower-tier local govern- Indonesian reform of 1999 resulted in the ments. In Korea, the central government's transfer of important responsibilities to efforts to consolidate local governments in local governments, but in the form of very large municipal units (on average near In lower income countries, in order to support 450,000 inhabitants), whereas villages are the development of democracy and the legitimacy of political the framework of citizen participation. In the Philippines, there is less concentration leaders, local councils or authorities elected by the residents of local government functions at the upper have been restored, but at the same time major functions level; nevertheless, the municipal govern- ments are still relatively large, with more have been devolved upon the intermediate level than 50,000 inhabitants on average. The barangays, communities of pre-colonial 1994 and 1995 was undertaken not only origin reshuffled by law at the time of the to realize economies of scale but also to Spanish colonization, constitute an avenue correct the much-criticized manner of of participation and of access to some demarcating the boundaries of local gov- administrative service rather than a go- ernments. As a result of this reform, the vernment level. number of local governments was reduced from 265 to 241 (including autonomous dis- In several other lower income countries, tricts and rural districts in Seoul and metro- there has been a process of municipaliza- politan cities). The boundaries of rural dis- tion with more tasks transferred to a tricts and secondary cities were redefined local level closer to the inhabitants while to form urban-rural integrated cities sepa- nevertheless endowed with some admin- rated from newly created urban districts. istrative capacity. The major example is India, although the situation may vary In lower income countries, the picture is considerably from one state to another: much more contrasted. In order to support the lowest level, the gram panshayat, has the development of democracy and the to manage pre-school and primary educa- legitimacy of political leaders, local coun- tion, provide some local services cils or authorities elected by the residents (libraries) and amenities (sport, leisure) have been restored, but at the same time and support local agricultural and eco- major functions have been devolved upon nomic development. In Pakistan, too, ASIA-PACIFIC Decentralization and Local Democracy in the World 65 although the sub-district level is crucial, and management of infrastructure and union administrations are local govern- services across the city. ment units of a fair size and some capac- ity. In Thailand, the reforms of 1999 and A few metropolitan areas (Metro Manila, 2003 resulted in municipal-level consoli- Bangkok, Tokyo) have a functioning met- dation in cities and boroughs and in the ropolitan level of government and in China upgrading of sub-district administrative strong municipal governments that organizations into units of local self gov- encompass large rural hinterlands have ernment. These units subsumed the always governed the largest cities. In Aus- headmen that until that time had been tralia, most of the metropolitan popula- elected by the people but subordinated to tions live outside central cities and infor- the provincial administration. These mal cooperation about planning has served reforms represent an important step as a means of metropolitan governance. towards the generalization of municipal Uniquely, the city government of Brisbane government in Thailand ­ although the encompasses the whole metropolitan area government system as a whole remains (ADB 2006a). In New Zealand, 12 local rather centralized. governments representing the largest cities and peripheral districts in the six The very rapid pace of urbanization in Asia biggest metropolitan regions have joined ­ a seven-fold increase in urban popula- with local government associations to tion since 1950 (ADB 2006a) ­ presents develop joint strategies to address gover- huge challenges for urban governance. At nance issues. the same time, decentralization policies in many countries are increasingly putting Elsewhere, there may only be some form these challenges into the hands of local of coordinating mechanism between the governments (ibid. p.4). Although city and various municipal governments. But it urban municipal governments are often rarely has the power or resources to tackle some of the longest-established local gov- metropolitan-wide infrastructure and serv- ernments in these countries (some going ice needs. For example, in Jakarta, the back over a century) they have generally remit of the city government (DKI) covers been unable to keep pace with the only what was the metropolitan area until demands of urbanization. A city or munic- around the 1970s. In recent years four ipal government often covers only the his- additional city governments have been toric core that spawned a vast metropoli- created in the adjoining areas where most tan area. Although its boundaries may, in new development has taken place. some cases, have been enlarged, this has Although there is a planning framework for very rarely been sufficient to keep pace the whole metropolitan region with the rapid urban expansion. (Jabodetabek), this has to operate on the basis of consensus among the constituent As a result, the urban periphery is often authorities. governed by a multiplicity of smaller municipalities, town and village councils, A further complication is the multiplicity of without any overall system of metropoli- agencies involved in urban development, tan-wide management. The available fiscal infrastructure and service provision. This resources are often concentrated in the has been a particular issue in India where core city, while the poorly served periphery there has been a long tradition of special (where many of the poorest live) is go- purpose agencies (SPAs). Thus, in a city verned by various municipal and village coun- such as Bangalore, there is a plethora of cils that have access to minimal resources. SPAs in addition to the state government, This fragmentation of urban governance the municipal government and the munic- presents huge problems in the financing ipal and village governments in the sur- ASIA-PACIFIC 66 Decentralization and Local Democracy in the World rounding area. The SPAs include the Ban- ery of basic education, ranging from pre- galore Development Authority, the Banga- school to secondary school. The only lore Water and Sewerage Board and the exceptions are Australia, New Zealand and Karnataka Slum Clearance Board (Devas Malaysia, where basic education remains 2005). This leads to overlaps, gaps and a state or central government responsibil- the lack of a coordinated response to the ity. Some aspects of health and welfare needs of the rapidly growing population. In services are delivered by local govern- many large cities of the region, endemic ment in most countries in the region political conflict between the various levels except for Australia and New Zealand, of government ­municipal, state and cen- where these functions remain with the tral­ make metropolitan coordination state and central government respec- even more problematic. tively. In Korea, health and social welfare accounted for 31% of total local expendi- ture in the consolidated local government III. Powers and Responsibilities, budget for 2007. In the Philippines, health Management and Finances and welfare services have been fully devolved since 1992. Water supply is pri- III.1. Functions of Local Government marily a local government responsibility in several countries of the region (e.g. Aus- As in other parts of the world, local gov- tralia, Japan, Indonesia, Pakistan and ernments in the selected countries of the Vietnam). By contrast, electricity supply Asia-Pacific region have multiple roles to remains a central government responsibil- ity throughout the region except in China Education is the most notable service delivered by local where it is a municipal responsibility. government in the region. The only exceptions are Australia, In New Zealand, under the influence of New Zealand and Malaysia, where basic education remains New Public Management (NPM), there has been a dramatic increase in private sector a state or central government responsibility participation in local service delivery. The 1989 Local Government Act requires local authorities to "give due consideration to perform: service delivery, governance, the advantages and disadvantages of dif- planning and community development, ferent delivery options" in the provision of and regulation and supervision. Table 5 local services. This led to a large increase provides a profile of the functions that are in contracting out and by the mid-1990s the responsibility of local government. 75% of all services were delivered by pri- Generally speaking, all countries have vate contractors (Boston 1996). In India, decentralized some basic services to this the pressure on recruitment, together level, including planning, education, pro- with the spread of NPM initiatives at the vision of social and health services, water state level, has also encouraged many supply, public transport and business local governments take up new activities development support. In Indonesia, the and service provision arrangements 2004 decentralization legislation (Law 32) through public-private partnerships, but devolved a comprehensive list of 16 oblig- corresponding systems of contract super- atory functions to local government. vision and `public service comparators' are still not very well developed. Education is the most notable service delivered by local government in the In addition to the functions listed in Table region. Local governments in China, 5, many local governments in the region Japan, India, Indonesia, Pakistan, Vietnam also perform some public works functions and the Philippines are involved in the deliv- such as road construction (e.g. Australia, ASIA-PACIFIC Decentralization and Local Democracy in the World 67 Table 5 Services Delivered by the Local Governments in the Asia-Pacific Region Country Planning Basic Basic social Basic health Water Electricity Public Business education welfare services supply supply transport development support Australia Yes No No No Yes No Yes Yes China Yes Yes Yes Yes Yes Yes No Yes India Yes Yes No Yes Yes No Yes Yes Indonesia Yes Yes Yes Yes Yes No Yes Yes Japan Yes Yes Yes Yes Yes No Yes Yes Malaysia Yes No No No Yes No Yes Yes NewZealand Yes No No No Yes No Yes Yes Pakistan Yes Yes Yes Yes Yes No Yes Yes Philippines Yes No Yes Yes Yes No No Yes Korea,Rep.of Yes Yes Yes Yes Yes No Yes Yes Thailand Yes Yes Yes No Yes No Yes Yes Vietnam Yes Yes Yes Yes Yes No Yes Yes Source: UCLG Country Profiles (2007). India, Pakistan and Philippines) and even Local Authority Trading Enterprise (LATE). airports (Australia). In most countries of These companies, in which the local gov- the region local government also has a ernments may hold 50% or more of the responsibility for environmental protection equity, employ their own staff and are although its powers of enforcement tend subject to company taxation. They ope- to be severely limited. China is the only rate in activities such as public transport, country where local governments in shopping malls, cinemas and car parks as autonomous regions perform functions well as water utilities, property manage- normally reserved for central government ment and quarrying. Some provinces in (e.g. judicial administration, scientific re- the Philippines own major facilities such search, unemployment benefits and pen- as convention centers and shopping cen- sions). ters that are managed as `profit centers' to provide additional sources of local rev- A number of local governments in the re- enue. Elsewhere, at the very least, local gion engage directly in business activities. governments provide support services for This is especially so in China and Vietnam, business development activities. The most where local governments are major pro- common commercial activity of municipal- ducers of industrial goods. In New ities is the operation of local public enter- Zealand, the 2002 Local Government Act prises such as markets, slaughterhouses, enabled local governments to create a bus terminals and car parks. ASIA-PACIFIC 68 Decentralization and Local Democracy in the World Table 6 Relative Size of Local Government Expenditure and Income in the Asia-Pacific Region Country Total public Local public Ratio Ratio local public Tax shares + general Local tax revenues expenditure expenditure local public investment exp/ grants as % of the (= tax revenues a) as % of GDP (local and meso expenses/total total civil public total LG Income subject to a b) per capita level only) public investment local tax power) a)% GDP expenses expenditure as % of total LG b) per capita income Australia a)37% a)2% 7% 6% 52% 38% (2005) b)11,486 b)276 China a)27% a)22% 81% n/a 32% 29% (2004) b)291 b)235 India a)19.1% a)Karnataka: 2.9% Karnataka:18.5% n/a Ruralpanchayat: Urbanlocalbodies:60%of 90%(allIndia revenuesfrompropertytax (2002) b)n/a b)n/a average) (allIndiaaverage) Indonesia a)19% a)6% 33% 36% 70% <10% (2006) b)189 b)62 Japan a)22.9% a)12.3% 53.6% n/a 69% 34% (2004) b)7,243 b)3,903 Malaysia a)27% a)4% 13% 11% 35% 26% (2003) b)1,152 b)155 NewZealand a)42% a)3.9% 9.4% 16% 68% 56% (2005) b)9,693 b)380 Pakistan*(2005) a)18.5% a)2.6% 14% n/a 90% 10%** Korea,Rep.of a)36% a)16% 44% n/a 53% 34% (2005) b)n/a b)n/a Thailand a)21% a)2% 9% 15% 45% 12% (2002) b)376 b)34 Vietnam a)24% a)11% 48% 51% 44% 24% (2002) b)n/a b)n/a Sources: IMF 2006; OECD 2005; World Bank 2004, 2006; and country profiles; + Add. Sethi (2004); Weist (2004). UCLG Country Profiles (2007) * Estimates based on own calculations [sources: Cyan, M. (2006); ADB/DfID/WB (2004)]. **Estimate including all own revenues. ASIA-PACIFIC Decentralization and Local Democracy in the World 69 III.2. Local Government Finances ties and account for less than 10% of public expenditure and around 2-4% of GDP. The The relative economic size of local go- size of local government in Vietnam has risen vernment varies widely across the region, as rapidly in recent years ­ more than doubling shown in Table 6. In China, the different tiers in absolute size and increasing from 40% to of local government play a major role in 48% as a share of total public expenditure service provision and local economic devel- from 1997-2002. Nevertheless, until it opment. Local governments manage some implemented the 2004 State Budget Law, 80% of state-owned enterprises. As a result, Vietnam was formally one of the least de- they account for 81% of public expenditure centralized countries in the world, with local and 22% of GDP. In Japan, local govern- governments essentially carrying out decon- ments have wide functional responsibilities centrated functions at the behest of the cen- and account for over half of total public tral government (World Bank 2005:87). For expenditure and 10% of GDP. In Indonesia, the biggest countries of the region, global as a result of the recent `big bang' decentral- data hide enormous disparities between ization, local governments now account for regions and between local governments. one-third of total public expenditure. By con- trast, despite their long-established tradi- Local governments of the selected countries tions, local governments in Australia and in the Asia-Pacific region are all equipped New Zealand have quite limited responsibili- with powers of taxation, as shown in Table Table 7 The Scope of Local Tax Powers in the Asia-Pacific Region Country Major local taxes Australia Property China Collectiveenterprise,agriculturalandrealestate India Property,octroi(taxongoodsenteringthemunicipality) Indonesia Hotelandrestaurant,entertainment,advertisement,electricity(streetlighting),non-strategicandnon-vitalmining,parking,groundwaterandenvironment.Inaddition, proceedsfromtaxesonlandandproperty,motorizedvehicles,vehicletransferandfuelaresharedwithprovinces. Japan Individualinhabitant,business,localconsumptionandautomobile,propertytax,cityplanningtax,localtobaccotax Malaysia Property NewZealand Property Pakistan District/city:education,health,vehicles(excludingmotorvehicles)Tehsil:services,propertyandsaleofproperty Philippines Property,business,amusement,sandandgravel,printingandpublication,franchiseandcommunity Korea,Rep.of Property,business,acquisition,registration,license,inhabitant,farmland,butchery,leisure,tobaccoconsumption,urbanplanning,regionaldevelopment,motorfueland localeducation Thailand Property,landandbuilding,landdevelopment,signboard,slaughterduties,swallownestduties,tobacco,petroleumandhotel Vietnam Landandhouse,naturalresources(excludingthoseonpetroleumactivities),license,landuserightstransferandlandrent. Sources: UCLG Country Profiles (2007). National Tax Service of the Republic of Korea (2006). Weist (2001). ASIA-PACIFIC 70 Decentralization and Local Democracy in the World 7. Property taxation is by far the major from VAT, corporate income tax, income source of local taxation; in Japan it tax on high-income earners, special con- accounts for 46.2% of own tax revenues sumption tax on domestic goods and (before the "Trinity Reform"); in Australia services, and gasoline and oil tax. Other this accounts for 100% of own-revenue tax revenues are exclusively assigned to and in New Zealand for 91% of own-rev- them, namely land and housing taxes, enue. In both countries, as well as in natural resource taxes (excluding petro- China, local governments also have dis- leum), license tax and land use rights cretion over the rate of property taxation transfer tax. In Indonesia, local govern- whereas elsewhere this tends to be deter- ments share the proceeds of taxes on mined by central or state government. In land and property, and on motorized some countries, business (or enterprise) vehicles and fuel with provincial govern- taxation is also a major source of own- ment. Many municipalities also levy user revenue. Municipalities throughout the fees and charges that comprise a minor region also collect taxes on hotels, part, typically less than 10%, of their restaurants and places of entertainment. total own-source revenues. Some local taxes are peculiar to a specific country. For example, city governments While local governments all have their in Japan impose an urban planning tax, own tax sources, the degree of fiscal Pakistani municipalities impose health autonomy also varies considerably and education taxes and Chinese munici- between countries. The more developed countries, such as New Zealand and Aus- tralia generate a substantial share of their revenues locally and are hence less reliant Ideally, the financial resources at the disposal of a local on intergovernmental fiscal transfers. The government ­ whether from its own sources3 or from grants share of grants in total local government revenue has fallen in both Australia and and transfers ­ should be sufficient to cover all services New Zealand in recent years - from 23% that it is mandated to deliver in the 1980s to 16% in the late 1990s in Australia and from 18% to 10% over the same period in New Zealand (OECD 2001). In Japan the local finance reform palities impose collective enterprise and ("Trinity Reform") 2005-2007 replaces agricultural taxes. In Indonesia since targeted subsidies by tax revenues (trans- 2004, municipalities may impose a tax on fer from the national personal income tax surface water. Together with the existing upon the individual inhabitant tax, how- local tax on groundwater, this authority is ever for a lower expected yield) and the part of the government's effort to curb global tax grant, until now a major equal- environmental damage from over- izing transfer from central budget, is exploitation of water resources. being reduced drastically. By contrast, in lower-income countries of the region such In China, Indonesia and Vietnam, the as India, Indonesia, Pakistan and Thai- proceeds of some locally collected taxes land, local governments (outside the are shared with higher tiers of govern- major urban centers) generate a much ment. In China, revenue from personal smaller share of their total revenues from income tax, product tax, business tax local tax sources (typically 10-30%) and and joint enterprise tax are all shared hence are heavily reliant on central trans- between central and local government. fers and grants. In Thailand, according to In Vietnam, local governments have no the 1999 Decentralization Plan and Proce- taxing powers at all. Instead, they share dures Act, local governments were to be with central government the proceeds allocated at least 20% of the national gov- ASIA-PACIFIC Decentralization and Local Democracy in the World 71 ernment budget by fiscal year 2001 and at problem is the issue of `unfunded man- least 35% by fiscal year 2006. The latter dates,' namely the predilection of central goal has not yet been reached and these government to legislate further responsi- targets have been the subject of heated bilities that involve an additional fiscal bur- debate. However, the degree of local fiscal den on local government. This is so in the autonomy is not necessarily a function of Philippines, where local government is the overall income level of the country. For required to pay additional incentives and example, Japanese local government only allowances to devolved health sector raises 34,4% of its total income from employees and allowances to national gov- own-taxes while local governments in ernment public servants (e.g. judges and China receive only 32% of their incomes police) whose offices lie within its jurisdic- from grants and shared taxes of central tion. These unfunded mandates have put a government. This disparity reflects the strain on the finances of local government very strong role that local government in and are a burning issue in the discourse on Japan plays as an `agent' of central gov- central-local relations in many other coun- ernment in the delivery of services, espe- tries in the region. cially education and social welfare, which are financed by earmarked inter-govern- Borrowing is another source of local gov- mental fiscal transfers. In contrast, the ernment funding. In the past, central gov- much stronger practice of fiscal decentral- ernments in most countries of the region ization in China through the mechanism of have limited the access by local govern- revenue sharing is counterbalanced by ment to capital markets because of the extreme political centralization. inherent risk that over-borrowing may lead to macro-economic instability. In Korea the Ideally, the financial resources at the dis- size of local government outstanding debts posal of a local government ­whether from from bond issues hardly changed during its own sources3 or from grants and trans- 2000-2006 because of the strong control fers- should be sufficient to cover all serv- exercised over local borrowing by central ices that it is mandated to deliver. This is government. In China, the central govern- not the case in India, Pakistan and the Philip- ment placed strict limits on the power of pines. In these countries own-source rev- local governments to borrow, but the latter enues of local governments plus transfers often found ways to avoid these controls received are together insufficient to fund by obtaining loans through their munici- the delivery of local services, suggesting pally owned enterprises. Today some cen- the need for the devolution of extra tax tral governments in the region are increas- powers in order to correct this imbalance. ingly encouraging larger municipalities to By contrast, the strength of municipal borrow. In Japan, loans are no longer sub- associations in the OECD countries of the ject to authorization, but only an under- region has ensured that the corresponding standing with central government, since extra revenues required to comply with April 2006. In India, several of the larger new mandates have accompanied the cities have issued municipal bonds and in devolution of new responsibilities to local the state of Tamil Nadu arrangements government. In Australia, such `cost shift- have been made for smaller municipalities ing' to local government was a central to join together to issue bonds. Of course, point of a 2006 Inter-Governmental Agree- municipal borrowing depends on a func- ment between the Local Government tioning capital market as well as the repay- Association and the federal government. ment capacity of municipalities. In the In New Zealand, it has been one of the Philippines local governments are legally 3. Own sources: major issues that contributed to succes- enabled and encouraged to tap financial resources levied sive waves of local government reform markets and other non-traditional sources directly by local from 1989 onwards. Complicating this of finance in order to make them less authorities. ASIA-PACIFIC 72 Decentralization and Local Democracy in the World reliant on central grants. However, very 92% and 77% in China and Indonesia few have yet attempted to tap private cap- respectively to lows of only 7% and 10% ital markets. Some local governments in Malaysia and New Zealand. Most local have used variants of the build-operate- government personnel in the region have transfer (BOT) schemes and other forms of permanent positions with tenure pro- private sector participation in order to fund tected by law although chief executive major investment projects, although inter- officers in New Zealand are recruited on est in these has waned somewhat follow- seven-year renewable contracts. ing the East Asian financial crisis. The institutional and policy frameworks for Borrowing from commercial banks has recruitment, as well as the organizational been minimal because of the lack of col- responsibilities in undertaking recruitment lateral or guarantees. Loans from govern- processes at the local level, are shown in ment financial institutions (GFIs) have Table 9. Specific laws govern local public been far more common because these service in most countries of the region. In GFIs serve as the depository banks for Japan, the Local Public Service Law defines the local governments for their intergov- the criteria for recruitment of local govern- ernmental transfers. Hence GFIs can ment personnel as well as a position clas- always withhold these central transfers in sification system, remuneration and be- The degree the event of default on loan repayment by nefits, hours of work, disciplinary matters of influence the local governments. A drawback, and training. In the Philippines, local govern- though, is that such arrangements can ment personnel are covered by civil service by higher tiers encourage irresponsible lending. In laws and by the rules and regulations of Indonesia, most borrowing by local gov- the Civil Service Commission (CSC), the of government in ernments has been from the central gov- central agency for public sector personnel. the selection of ernment, often involving on-lending of In addition, the 1991 Local Government donor funds. In New Zealand, a 1996 Code has provisions regarding personnel local government reform eased the process of loan approval administration. The Code mandates all staff remains but also placed new legal restrictions on local governments to design and imple- it. In place of central government ment their own organizational structure considerable in approval, localities were required to spec- and staffing pattern, taking into account the region ify explicitly the purpose and beneficiaries their service requirements and financial of a borrowing measure and to budget capacity. It also provides for the manda- accordingly so as to cover operating tory appointment of certain posts at every expenses. In Australia, local government tier of local government and the creation borrowing is coordinated by a national of a Personnel Selection Board in each Loan Council that allocates and regulates local government unit to assist the local debt among the states. In Korea, the size chief executive in the fair selection of per- of outstanding local government debt sonnel for employment and promotion. from bond issues hardly changed during Notwithstanding these safeguards, prob- 2000-2006 because of the strong control lems such as nepotism and associated exercised over local borrowing by the non-compliance with the merit principle in central government. recruitment and promotion are endemic in the local public service system in many III.3. Administrative Capacity countries of the region. of Local Government The degree of influence by higher tiers of Data on the share of local level personnel government in the selection of local go- in total public sector employment for se- vernment staff remains considerable in lected Asia-Pacific countries is shown in the region. In China, the committees of Table 8. The share ranges from highs of the Chinese Communist Party choose, ASIA-PACIFIC Decentralization and Local Democracy in the World 73 Table 8 Size of Local Government Personnel in the Asia-Pacific Region Country Local government personnel Total public sector personnel Share of local government personnel in total public sector employment Australia 147,500 1,357,600 11% China 5,000,000(est.) n/a 92% India n/a n/a n/a Indonesia(2006) 2,781,476 3,635,816 77% Japan 1,432,494 2,311,920 62% Malaysia 58,000 829,000 7% NewZealand 21,680 227,220 10% Pakistan n/a n/a n/a Philippines(1999) 390,561 1,445,498 27% Korea,Rep.of(2006) 345,989 611,219 56% Thailand n/a n/a 20% Vietnam n/a n/a 60% Source: UCLG Country Profiles (2007): Figure 7.1. manage, discipline and dismiss civil ser- train, promote and discipline their person- vants, including those in local govern- nel and even manage pensions but all ment. The recruiting body is likewise these actions require approval by state responsible for the discipline and dis- government. Local budgets are also sub- missal of appointees. At the other end of ject to state supervision. the spectrum, in Australia and New Zealand, local councils appoint the Chief In Thailand, the strong vertical connec- Executive Officer (CEO) but all other staff tions between local officials and officials of are employees of the CEO. In Pakistan, the central government (especially in the provincial authorities largely determine Department of Local Administration of the the appointment of senior local govern- Ministry of Interior), who handed out jobs, ment personnel, with district and city have been dismantled and personnel deci- establishments composed basically of sec- sions are now largely under the power of onded federal and provincial civil ser- the local executives. Bureaucrats resident vants. In Indonesia, despite a radical in Bangkok often resist transfer to the decentralization reform, the central gov- provinces, which involves moving and ernment still exercises substantial control possibly less authority and lower pay. over local government staff appointments. However, transfers to local governments In India, selection and recruitment of local are more attractive for provincial officials government staff is done by either the given that provincial offices and district local authorities themselves or by a state offices have lost authority as a result of level body concerned with recruitment. decentralization and the transfer does not Local government in Malaysia can recruit, require a change in residence. ASIA-PACIFIC 74 Decentralization and Local Democracy in the World Table 9 Institutional and Policy Frameworks for Recruitment Processes and Human Resource Development at the Local Level in the Asia-Pacific Region Country Staffing regime (public or private Recruitment procedure, especially Institutional arrangements for training law, career or job positions) for high-level positions of local government staff Australia Publiclaw Recruitmentbyindividuallocalgovernmentunit Organizedandfundedbyindividuallocalgovernmentunits China Civilservantlaw Annualcompetitiveexamatnationalandlocallevels Organizedandfundedbylocalgovernment India Largelybypubliclaw Centralandstatelevelstaff,selectedby Notmandatedbylawbutorganizedbycentralandstate examination,areassignedtoseniorLGposts. governments Indonesia Publiclawwithcareerpositions Centralgovernmentstillexercisescontrolover Implicitlymandatedbylawandorganizedbycentraland recruitment,whichisgenerallybycompetitive localgovernment examwithseniorLGpostsfilledbypromotion ofcareer-basedofficers. Japan Localpublicservicelawforfull-timepositions, Competitiveexamsforalllocalgovernments Regulatedbylocalpublicservicelawandimplementedby careerpositions eachlocalgovernment Malaysia Localcouncilshaverecruitmentboards, Bylocalgovernmentsubjecttoapprovalof NationalInstituteforPublicAdministration(INTAN)actsas supervisedbyPublicServiceCommission. statelevelgovernment trainingarmofthePublicServiceCommission. NewZealand Fixed-termsevenyearcontractsforChief StaffinglevelsdeterminedbyeachCEOwho LocalGovernmentNewZealandprovideslimited ExecutiveOfficer(CEO)andtenurefor recruitsandactsaslegalemployerofallotherstaff professionaltraining otherpersonnel Pakistan Federal,provincialandlocalcivilservice CentralizedrecruitmentbymeritthroughPublic Variouspublicsectortraininginstitutions cadresundercivilserviceacts ServiceCommissionwithprovincialcadres assignedtoseniorpostsinlocalgovernment Philippines Civilservicelawand rules,1991local Byindividuallocalgovernment LocalGovernmentAcademy,DeptofInteriorandLocal governmentcodeandcivilservicerules GovernmentandCentreforLocalandRegionalGovernance, andregulations UP-NCPAG Korea,Rep.of Localpublicservicelawforfull-timepositions Centralgovernmentstaffassignedtolocal LocalAdministratorFormationInstitutes(LATI); government.Otherstaffrecruitedbycompetitive Otherpublicsectortraininginstitutions examinationoroncontractbasis Thailand Strongcentralgovernmentcontrolrelaxedwith Centralgovernmentsetsbroadnationalstandards Centralgovernmentandprovincialresponsibility recentrapiddevolutionofpersonnel forhiring,firing,recruiting,andsettingsalariesand responsibilitytolocalgovernment benefitsinlocalgovernments.Personneldecisions arenowlargelyunderthepoweroflocalexecutives. Vietnam Regulatedby2003OrdinanceonCadres Centralgovernmentstaffassignedtolocal NationalAcademyofPublicAdministrationandProvincial andCivilServants government.Otherstaffrecruitedbycompetitive andDistrict-levelPoliticalSchools examinationoroncontractbasis Source: UCLG Country Profiles (2007) and Brillantes 2006. ASIA-PACIFIC Decentralization and Local Democracy in the World 75 The most far-reaching management re- greater, since infrastructure and serv- Decentralization forms affecting local government in the ices are likely to be much more expen- reforms and region have been in New Zealand where sive. In turn, inadequate physical infra- the 2002 Local Government Act requires structure is often a major impediment to associatedgreater both annual and long-term plans as well industrial development and urban eco- local level as systematic consideration of outcomes nomic growth, on which national eco- for local communities. It also prescribes nomic development depends. autonomy require principles for public consultation includ- major capacity ing transparent presentation of propos- In its report on urbanization and sus- als, options and procedures. Most Aus- tainability in Asia (ADB 2006a), the building and tralian states have introduced systems Asian Development Bank identified a training of performance management for local number of examples of good urban gov- government, including performance ernance in 12 countries in the region. interventions for indicators and other benchmarking These include: innovative approaches to strategies. In particular, the introduc- revenue mobilization and capital financ- local government tion of accrual accounting has had a ing; improved administration and per- personnel in the major impact on local government man- formance-oriented management; agement because of the requirement to increased availability of information and Asia-Pacific region value assets and make adequate provi- transparency of decision-making; sion for depreciation. Elsewhere in some greater citizen participation in decision- countries of the region, significant making; collaboration between munici- decentralization programs have created palities within the metropolitan area or severe strains on the management economic sub-region; serious attempts capacity of local governments as they to tackle environmental problems and try to cope with the administrative chal- effectively enforce pollution controls; lenges caused by the rapid transfer of significant programs to address urban central government responsibilities and poverty, and support to community- personnel. based service improvements. However, such initiatives have been the excep- The challenges of limited capacity and tion. In all such cases, local leadership resources that all local governments has been the critical factor: leadership face are amplified in urban areas. The that is committed to reform and to problems of urban management are mo- improving municipal conditions, is effec- re complex and the potential for disaster tive in mobilizing support for such initia- (natural and man-made) is greater. tives and is responsive and accountable Environmental problems are particularly to local citizens. Developing such civic severe, with inadequate capacity to leadership across the region remains a treat human and industrial waste, major challenge. severe contamination of water sources and serious air pollution from both Decentralization reforms and associated industrial activity and the rapid growth greater local level autonomy require major of motor vehicles. Although city govern- capacity building and training interventions ments may be better able to recruit for local government personnel in the Asia- qualified staff compared to rural local Pacific region (Brillantes 2006). As shown in governments, their capacity to regulate Table 9, such training and capacity-building development and to effectively control programs in the selected countries of the environmental risks remains quite lim- region often form part of each country's over- ited. Similarly, although city govern- all civil service and policy frameworks. It is ments may have access to much greater noteworthy that Korea, a country that has fiscal resources than rural governments, emphasized knowledge management as a their need for resources is also much core element of the development process, is ASIA-PACIFIC 76 Decentralization and Local Democracy in the World Corruption in the pursuing capacity building in the public sector in the world while Australia is ranked ninth through the establishment of separate spe- (Transparency International 2006). Although public sector, cialized training institutes for central and local the CPI does not directly pertain to corruption including local government personnel, respectively the Cen- at the local level, local governments are not tral Officials Training Institute (OTI) and the exempted from this negative perception. In government, is a Local Administrators Training Institute (LATI). fact, there is a widespread perception in both global concern China and Indonesia that decentralization has In the context of the current decentralization increased corruption. Indeed decentralization reforms in the region, attitudinal change can increase the problem of corruption, or at among central government officials is neces- least spread it around much more widely, sary to mitigate the new challenges and diffi- making it more difficult to manage. On the culties faced by local government personnel. otherhand,democratizationandthestrength- In Japan, this process is encouraged by inter- ening of civil society may simply expose cor- governmental personnel exchanges, whereby ruption to more public view, so that citizens central government personnel from the Min- perceive that the problem has increased even istry of Home Affairs are regularly seconded when it has not. to local government, a practice that is not at all common in New Zealand. Apart from Many developing countries of the Asia-Pacific enabling these officials to appreciate the per- regionhaveseriousproblemswithcorruption. spectives of the `locals' and hence decentral- This is much less significant in the richer ize their own ways of thinking, this is also a countries such as Japan, Australia and New way of building the capacity of local govern- Zealand, because of both the much higher ment through the expertise that is shared rates of staff remuneration and the well with them. In this respect, there is growing established arrangements for public scrutiny interest in encouraging joint training insti- and control in these countries. In New tutes of public administration for both local Zealand, the State Services Commission has and central government personnel in order to since 1988 elaborated and monitored a Code promote cross fertilization and collaboration of Conduct for public ethics and conflicts of between the different tiers of government. interest in local as well as central govern- Given the continued thrust towards decen- ment. The national Auditor-General enforces tralization in the region, the relative merits of these rules and criminal charges can be separate training institutions for national and brought in the event of breaches. Elsewhere, local government employees (as in the case corruption can seriously erode the availability of Korea and the Philippines) and joint train- of resources for local service delivery and can ing institutions deserve attention. prevent citizens, particularly the poor, from gaining access to these services. III.4. Integrity and Corruption Several countries in the region have intro- duced new mechanisms to curb corruption, Corruption in the public sector, including local including greater transparency of decision government, is a global concern. Developed making. In Malaysia, improvements in local and developing countries alike are bedeviled government recruitment procedures and with corruption issues. The annual Corruption remuneration, together with e-governance Perception Index (CPI) published by Trans- initiatives, have been designed to improve parencyInternationalrevealsthatsomeofthe ethical standards and the transparency of case study countries in the region (Indonesia, local service delivery. In the Philippines, the Pakistan, Philippines and Vietnam) are near Transparent Accountable Governance Project the bottom of the ladder and strongly suggest involves a `conduct of lifestyle' check on pub- that corruption in these countries is perceived lic officials and procedural reforms in local as a major problem. On the other hand, New government transactions (procurement, ad- Zealand is ranked as the least corrupt country ministration of local public enterprises, prop- ASIA-PACIFIC Decentralization and Local Democracy in the World 77 erty tax administration and business permit- Generallyspeaking,localgovernmentsasself- Localgovernments ting and licensing). In India, many states governing institutions are both accountable to in the selected have appointed a Lokayukta (ombudsman) their citizens and to the higher levels of go- to combat corruption and malpractice in gov- vernment of which they are agents. In Pa- countries operate ernment, including local government. In kistan, local political accountability remains under a legal Japan, there were a reported 92 cases of cor- problematic because of the control functions ruption in 2004 at the municipal level. Meas- that the provincial government continues to framework that is ures to combat corruption include strength- exercise over local government on matters defined by higher ening the external audit system and check up such as local personnel management and and reform of the accounting process. But local finances. Local governments are also levels of elsewhere (e.g. Pakistan, Philippines and helpless in influencing grant-aided programs Indonesia) the capacity of central govern- in their jurisdiction because these are usually government ment to monitor and audit local governments determined by provincial and national le- remains a major concern. For example, gislators. By contrast, in Indonesia, decentral- reports from the Philippine Center for Inves- ization fundamentally altered the direction of tigative Journalism point out that up to 70% accountability. Prior to the 1999 reforms, local of local health funds disappear as a result of government was answerable primarily to the corruption. central government, but after the introduction of direct elections of provincial and local gov- III.5. Central-Local Relations ernment executives and legislatures, the directionofaccountabilityshiftedmarkedlyto- Local governments in the selected countries wards the local electorates. operate under a legal framework that is defined by higher levels of government. In In most of the selected countries, national or unitary nations such as China, Indonesia, state level agencies perform general oversight Japan, Korea, New Zealand, Philippines, of local government with regard to audit and Thailand and Vietnam, central governments probity. Nevertheless, the extent of this prescribe the powers and functions of local `upward' accountability of local government to government. In federal systems such as higher levels of government differs markedly Australia, India, Malaysia and Pakistan local among countries in the region. In China and governments are answerable to the state or Vietnam, local governments have a dual sub- provincial government. In Australia, state ordination, both sectorally (to central govern- and territory ministers for local government ment ministries and agencies) and territorially may dissolve local councils and appoint (to the people's councils). The people's coun- administrators to carry out all local govern- cils are themselves subject both to supervi- ment functions. When this happens, the sion and operational guidance from the ministers usually have to hold public national level and to guidance and inspection inquires into the alleged failings of the con- from sector ministries and agencies of central cerned council that justified the inter- government. In India, state sectoral agencies vention. Even state constitutional provisions often perform functions that overlap with local that restrict these powers can be amended government functions and preempt local gov- relatively easily (CLGF 2005:29). In New ernment responsibility4. Zealand the 2002 Local Government Act gives the minister for local government the In contrast to many countries in the region, power to initiate review of local govern- central government ministries and agencies in ments for mismanagement or deficiencies in Japan do not have direct control or supervi- council decision making. In India there are sion over local governments but may only no special avenues for intergovernmental provide information and suggestions. How- relations and there is no formal representa- ever, the Ministry of Home Affairs exercises de tion of local government in the state struc- facto central fiscal supervision and control by 4. Sethi (ed.), 2004, tures (CLGF 2005:106). way of the model budget that it presents to (pp.15-16.) ASIA-PACIFIC 78 Decentralization and Local Democracy in the World Even when major the local governments every year. When the licies if it believes they contradict or threaten central government disapproves of their deci- national policies or interests. As a result, pro- decentralization sions or policies, local governments can vincial governors and district officers still retain reforms have taken appeal to the Dispute Settlement Commis- considerable authority over local government. sion; however, authorities almost always pre- place, the power of fer further discussions. A similar situation III.6. Local Government Associations central government existsinKorea,where,despitetheirsignificant size, local governments have far less auton- The development of local governments may still prevail omy in practice than suggested by legislation. undoubtedly depends to a large extent on the over local The lack of clarity over the division of respon- "local hands" that mind these communities. sibilities with central and provincial govern- Yet there are situations when local govern- government ments ­two-thirds of enacted local govern- ments need to look beyond their parochial ment responsibilities are exercised jointly with concerns and be more forward-looking and provincial government­ is especially true in pro-active in their orientation. Oftentimes, the case of education, where local govern- local governments would need some kind of ments deliver services as agencies of central mechanism that can work for their mutual government. Provinces and metropolitan city interests and more significantly, to represent governments enjoy considerable supervisory their collective interest in dealing with higher authority over local government (cities, rural levels of government and external institutions districts and autonomous urban districts). such as donor agencies. In this respect, local government associations have become the Even when major decentralization reforms instrument that local governments in the have taken place, the power of central govern- region adopt to advance their mutual inter- ment may still prevail over local government. ests.Theseassociationsperformdiversefunc- In India the state-level Local Government Min- tions for local governments. ister may dissolve elected bodies and govern them directly for up to six months. However Onesignificantrolethattheseassociationsper- elections must be held within six months formistoactasrepresentativeandadvocateof in order to reconstitute the municipality. By local government interests in higher levels of contrast, in the case of the Philippines the dis- government. Australia has perhaps one of the solution of local elected bodies is prohibited, longest existing national local government even by the highest level of government. Such associations in the region. Established in 1947, a process can only be carried out `from below,' the Australian Local Government Association either through regular elections or through the (ALGA) sits as member in the Premiers Confer- recall process, whereby the voters themselves ence5 and Council of Australian Government decide on the fate of the elected officials. The and various ministerial councils, intergovern- principle here is that elected officials are solely mental committees6 and specialist advisory accountable to the citizens who elected them. bodies. The association has helped shape the reformagendain1990ssuchasNationalCom- In Thailand, the Ministry of the Interior is per- petition Policy and reviews of intergovernmen- ceived as the strongest opponent of decentra- tal relations. At the state level are also found lization. By pointing to local weaknesses in ad- local government associations that link the ministrative capacity and personnel, the councils in intergovernmental forums, negotia- ministry has attempted to stem the loss of its tions, and cooperative efforts in general and authority. The ministry argues that it needs to specific areas of activity. As in Australia, local 5. Member states of the retain the extensive supervisory powers that it governments in New Zealand have formed the Federation exercises over local governments through the Local Government Association of New Zealand (Translator's note). 6. Gathering together provincial administration under its control. Lo- representing the interests of 86 member local the different levels of cal governments are subjected to auditing by authorities. Since 2000 when the central gov- local representatives the ministry once a year. The ministry can al- ernment-local government forum was initiated, (Translator's note). so intervene to terminate or modify local po- the association has consistently represented ASIA-PACIFIC Decentralization and Local Democracy in the World 79 local government in discussing common issues (formerly APKASI ­ now BKKSI) and the Localgovernment and coordination of public services. Member- Association of Indonesian Provincial Go- associations work ship in Australian and New Zealand local gov- vernments (APPSI). They lobby the National ernment associations is voluntary but coun- Parliament and the central government to for the mutual cils in the two countries have chosen to be advocate local issues and interests. The asso- interests of local members because of the actual and potential ciations also serve as a forum for discussing contributions that the associations give to the common interests and forging partnerships governments and councils. The senior local authority officers in among local governments. Local government represent their this country have also formed themselves associations are more closely linked with the into a national professional body called Soci- central government in Malaysia, (the interests in dealing ety of Local Government Managers. Other Malaysian Association of Local Authorities or associations in the sub-region, recently cre- MALA), Vietnam (the Association of Provincial with higher levels ated, are the Fiji Local Government Associa- Cities of Vietnam, renamed the Association of of government as tion and the Papuasia New Guinea Urban Cities of Vietnam or ACVN) and Thailand (the Local Level Association. National Municipal League of Thailand or well as external NMLT). The youngest associations are the institutions such as In the Philippines, the Union of Local Authori- Provincial Association of Commune/Sangkat ties in the Philippines (ULAP) is a national Council (PAC/S) and the National League of donor agencies body,establishedin1997,thatiscomposedof Communes and Sangkat (NLC/S) established various leagues at the provincial, city, munici- in August 2006 in Cambodia. pal and barangay (village) levels. These leagues represent their respective interests India has several local government associa- and serve as mechanisms to articulate issues tions including the All India Council of Mayors, that directly concern them and to secure solu- representing the municipal corporations, and tions. The ULAP seeks to unite members to the Nagar Palik Pramukh Sangthen, repre- pursue genuine autonomy for all local govern- senting the other urban municipalities. Unlike ment units. Various groups of elected local Australia, New Zealand and the Philippines, officials (such as vice mayors, women mayors theseassociationsarenotrecognizedinlaw.Many and young legislators) and professional local Indian states have City Manager Associations government staff (such as treasurers, asses- for urban local government officials. Despite sors and planners) also have their respective the existence of these associations, local go- national associations. In Indonesia, six inde- vernments have no formal representation in pendent associations representing specific state government structures; meetings and levels of local government were created in dialogues with state level institutions happen 2001, following the Local Government Law on an ad hoc basis and by specific local gov- 1999/22: the Association of Indonesian ernment. After several years of effort, an Municipal Councils (ADEKSI), the Association Association of Local Governments was es- of All Indonesian Regency Legislative Councils tablished in India in 2006. In Bangladesh, (ADKASI), the Association of Indonesian Nepal and Sri Lanka national associations of Provincial Councils (ADPSI), the Association of local governments were created in the mid- Indonesian Municipalities (APEKSI), the Asso- 1990s7. By contrast, there is no local govern- ciation of Indonesian District Governments ment association in Pakistan. 7. There is ADDC/N, the Nepalese Association of District Development Committees (founded in 1995); MuAN, the Municipal Association of Nepal (established in 1995) and NAVIN, the National Association of Village Development Committees. Following the establishment of ADDC/N, a new impetus was given to the collective strength of DDCs and decentralization supporters for speeding up the process toward decentralization. After four years of hard struggle, a new Local Self-Government Act was enacted in 1999, which can be regarded as a milestone in the gradual but steady movement toward decentralization. Sri Lanka has the National Chapter of Mayors (NCM) created in 1997, the United Urban Councils Association (UCA) and the Pradeshiya Sabhas Association (PSA) created in 2002. Bangladesh gained local government associations in 2003 when both the Municipal Association of Bangladesh (MAB) and the National Union Parishad Forum (NUPF) were established. ASIA-PACIFIC 80 Decentralization and Local Democracy in the World In Japan, there are no formal associations monwealth Local Government Forum and of local governments that represent local the Asia-Pacific Regional Section of United government interests. But there exist a Cities and Local Government Organizations. number of elective position-based associ- Additionally, several countries have devel- ations such as Japan Association of City oped local government organizations aimed Mayors, Association of Town and Village at developing international cooperation with Mayors, National Association of Chairper- local governments abroad: in China, the sons of City Councils and the National Chinese International Friendship Cities Asso- Association of Chairmen of Town and Village ciation; in Japan, the Council of Local Autho- Assemblies. These organizations cooper- rities for International Relations (CLAIR) ate with the National Governors' Associa- and in the Republic of Korea the Korean tion and the National Association of Local Authorities Foundation for Interna- Chairpersons of Prefectural Assemblies in tional Relations. presenting and negotiating policy alterna- tives with central government. In China, IV. Local Democracy local governments are represented by the China Association of Mayors, created in Throughout much of the Asia-Pacific Beyond 1991. In the Republic of Korea, the new region, multi-party democracy is thriving course in favor of decentralization has at the local level. The mayor-council sys- representation to been accompanied by the creation of na- tem is the norm across the region tional associations: the National Associa- although local electoral practices vary higher levels of tion of Mayors (1996) and the Governors considerably, including whether mayors government, local Association of Korea, based on article are directly or indirectly elected (UNDP 154, paragraph 2 of the Local Govern- 2006b). In most countries citizens directly government ment Act (1999). elect their local government legislatures associations (councils) as well as their executives Another area where associations have (mayors), as shown in Tables 10 and 11 advance their played an important role is training and below. The major exception is Malaysia, respective capacity-building for councils and local where the state government appoints staff. In Australia, the state associations local councils and executives ­although concerns also act as employer bodies for councils in those appointed are intended to act as and interests industrial relations. They also provide representatives of the local community. In training and capacity-building projects for Pakistan, an electoral college of lower tier internationally councils and deliver a number of special- council members selects the higher tier of ist services such as general insurance, local administration. In China and Viet- workers' compensation insurance and nam, local communities elect their respec- retirement income schemes for their tive congresses or councils but the candi- member councils. The documentation and dates are subjected to a prior screening dissemination of local government best process. These local councils in turn nom- practices are increasingly becoming an inate representatives to higher level bod- important function that these associa- ies at the town, county, city and provincial tions fulfill for their members. levels. In Vietnam, although candidates for council elections are usually members Beyond representation to higher levels of of the ruling Communist Party, there have government, local government associa- been recent efforts to attract non-party tions advance their respective concerns members or self-nominated candidates to and interests internationally. This is espe- stand in local elections. In the 2004 local cially true in Australia and New Zealand. elections, non-party candidates won 312 Local government associations in these seats compared to 25 in previous elec- countries are members of regional and in- tions, spread among more than 10,000 ternational organizations such as the Com- municipalities. ASIA-PACIFIC Decentralization and Local Democracy in the World 81 IV.1. Electoral Systems enhance accountability because they give for Local Councils voters a specific representative with whom to identify. However, this may not It is generally believed that proportional always be true. PR systems can concen- representation (PR) electoral systems are trate power in parties rather than voters' the most representative because they hands, and having an identifiable repre- tend to produce electoral results that are sentative in a FPTP system may not ne- more reflective of actual voting patterns, cessarily translate into greater accountability whereas plurality-majority or `First Past from this person to the electorate The Post' (FPTP) systems are thought to (UNDP 2006b). Table 10 Electoral Systems for Local Councils in the Asia-Pacific Region Country Electoral system for directly Electoral system for directly Terms of mandate and Electoral turnout and trend elected lower tier LG councils elected upper tier LG councils number of terms Australia Mixedsystem­PRandFPTP 2years(2states),threeyears Compulsoryvotingin4states. (3states),4years(1state)and Elsewhereturnoutisgenerallylow, 1-4yearsinNorthernTerritory except wherethereispostalvoting China Mixedsystemthroughout. Mixedsystem 5years Declining India AllLGcouncils(ruralandurban,alltiers)haveFPTP,single-memberwardconstituencies 5years Figuresunavailable Indonesia AllLGcouncilshavePR`openList'system 5yearswithnolimitonnumber Completefiguresunavailable. ofterms Japan AllLGcouncilshavePRlistsystem 4yearswithnolimitonnumber Declining,56.23%(2003) ofterms Malaysia* Notapplicable NewZealand MostlyFPTPbutSTVinafewcases 3years 2001­50% 2004­52% Pakistan UnioncouncilshaveFPTP Notapplicable 4years Figuresunavailable +multi-memberconstituencies Philippines BarangaycouncilshaveFPTP Municipalandcitycouncils,andprovincial 3yearsandmaximum3terms Approx.80% withblockvote.arrangement boardshaveFPTP. Korea,Rep.of Korea:Directcouncilelectionbysingleroundmajorityvoteintheelectoral 4years districts,andbyPRlistsinlocalauthority territorieswithunitarywards. Thailand AllLGcouncilshaveFPTPsystem. 4years 35.39%(BangkokMet. Admin. Council) District(Councilelections) Vietnam People'scouncils(commune,districtandprovince)haveFPTPandmulti-member 5years 98.7%(2004) constituencies Source: UCLG Country Profiles (2007) and UNDP (2006b) . Note: FPTP = First-Past-The-Post; PR = Proportional Representation; STV = Single Transferable Vote. * There is no electoral system for local government in Malaysia. ASIA-PACIFIC 82 Decentralization and Local Democracy in the World The major features of the electoral system executive (or mayor) is directly elected (e.g. for local councils in selected Asia-Pacific Japan, New Zealand and Philippines). countries are presented in Table 10. In most Indonesia's two-round electoral system (bal- countries council members are directly lotage) for local executives is designed to elected according to the FPTP system via sin- ensure that they have at least received a gle-member constituencies, i.e. geographical majority (i.e. more than 50%) of the votes. areas at the sub-municipal level, known as This aims to overcome one of the disadvan- `wards' in Australia and Pakistan and as `dis- tages of the FPTP electoral system, namely tricts' in the Philippines. The only exceptions the likelihood of `wasted' votes. In Indonesia are Pakistan and Vietnam where the FPTP and Pakistan, the heads and deputy heads system is applied to multi-member con- of lower tier councils are directly elected, but stituencies. The Block Vote system is used on the basis of a joint ticket. In Indonesia for local elections in the case of barangays in this is on a party basis, while in Pakistan it the Philippines under which electoral districts is on a non-party basis. In India, the form of are multi-member and voters are given as election of panchayat and municipal leaders many votes as there are open seats in a leg- varies from state to state, depending on islative chamber. They can cast the full num- state legislation. Hence, in a few states ber of votes or as few votes as they like and council members belonging to the party with the candidates with the most votes overall an elected majority, indirectly elect the local win the election. Uniquely, New Zealand con- executive. Australia has a mixed system ­in ducts local elections exclusively by mail and three states the local executive is directly in four states of Australia voting in local go- elected, in three states the council chooses vernment elections is compulsory. between direct and indirect election and in one state citizens choose. Only Indonesia and Japan rely exclusively on PR for local elections, a system that has Where upper tier councils are themselves tended to strengthen the power of national directly elected by voters (and not by political parties over local political life. In electoral colleges), their local executives are 2004, Indonesia moved from a `closed' to an invariably also directly elected by voters `open' list PR system, in order to reduce the (e.g. India, Indonesia, Philippines and Viet- power of national party executives to select nam). Similarly, where upper tier councils local candidates. This electoral reform are indirectly elected, local executives are sought to provide voters with more `voice' in generally also indirectly elected. This is the deciding which individuals (as opposed to case in Pakistan, which has a hybrid system which parties) represent them in local gov- of indirect elections for local executives. The 8. The union ernment. New Zealand and Australia have a leader (nazim) of any town (tehsil), district administrations mixture of systems for electing council or city is indirectly elected by an electoral council is the members, which includes FPTP, PR and sin- college consisting of all the union councilors8 institution which gle transferable voting. in their respective constituencies. They are brings together thus indirectly elected by all union councilors villages or IV.2. Electoral Systems for Local (including the union council leaders (naz- neighborhoods which Executives ims) and deputy leaders (naib nazims) in have their own their respective jurisdictions. However, naib elected organs. In The method of election of the local execu- nazims at the tehsil or district tiers are indi- Pakistan there are tive also varies from country to country rectly elected by their respective councils 6,125 union within the region, but in many cases it also (from amongst themselves) and not by a administrations that varies between the different tiers of local wider electoral college. each form the basic municipal government within a country. The major administration for an features of the electoral system for the local The term of office of the local executive average population executive in selected Asia-Pacific countries varies within the region ­from a minimum of 15.000. are presented in Table 11. Typically the local of three years (e.g. New Zealand and ASIA-PACIFIC Decentralization and Local Democracy in the World 83 Philippines) to a maximum of five years restrictions on the number of executive (e.g. Australia, China, India, Indonesia office terms ­ two in Indonesia and Thai- and Vietnam). Several countries place land and three in the Philippines. Table 11 Electoral System for Local Executives in the Asia-Pacific Region Country Directly Mayors elected by council Mayor appointed Term of Maximum Provision for elected by higher tier office number citizen recall mayors of mayor of terms of mayor Australia In3states In3states No 4years Nolimit Insomestates China No No Yes 5years Nolimit No India Inmostcases Incaseofsamitiandzilla No 5years Nolimit No chairpersons Indonesia Yes No No 5years 2terms No Japan Yes No No 5years Nolimit Yes Malaysia No No Yes n/a n/a No NewZealand Inallcases Onlyincasesofregional No 3years Nolimit No chairpersons Pakistan Unionnazimandnaib Tehsil/districtnazimselectedbyallUC No 4years Nolimit No nazim-onajointticket membersintheirrespectivejurisdictions. Naibnazimsattehsilanddistricttiers chosenbytheirrespectivecouncils Philippines Yes No No 3years 3terms Yes Korea,Rep.of Yes No No 4years 3terms Yes,witheffect from July2007 Thailand Yes No No 4years 2terms Yes Vietnam No ChairofPeople'sCouncils'Standing No 5years Nolimit No CommitteesindirectlyelectedbyPeople's Councils.ChairsofPeople'sCommittees (Commune,DistrictandProvincial) electedbyPeople'sCouncils Source: UCLGCountryProfiles(2007). ASIA-PACIFIC 84 Decentralization and Local Democracy in the World IV.3. The Role of Political Parties by a broad selectorate (150 ­ 300 people), before approval by the party leadership at Partisan local elections are the norm in the county level, and final direct election by the Asia-Pacific region. The only significant citizens among selected candidates. exceptions are New Zealand and Australia Although under Party control, these elec- where non-partisan or independent affilia- tions have already changed the relation- tion is the norm except in large cities. ships between villages and lower local gov- Attempts to `de-politicize' local govern- ernment levels in favour of villages9. ment have occurred in Pakistan and the Philippines, two countries where political Local government elections throughout the parties are a vital part of political life at the region are hotly contested but are often national level. In Pakistan, political parties marred by manipulation and cheating by are banned from contesting local elections competing parties. In most countries, local and in the Philippines they are banned from political parties are branches of national barangay elections but are allowed at all political parties. Independent candidates other tiers of local government. However, are prohibited in Indonesia but are allowed in practice political parties play a major in the Philippines. Local and national elections role in local government elections in Pak- are often synchronized, with local party istan by supporting candidates who are branches receiving funds from their closely identified with one party or national headquarters to promote the elec- another. toral campaigns of candidates for national office. Throughout the region, politicians In China and Vietnam, the only political view local government as a stepping stone party allowed to contest local elections is to national political office. However, as a the ruling Communist Party. Independent result of decentralization reforms, issue- candidates may stand for election in Viet- based local elections are increasingly nam but all candidates (whether Party on transforming local politics. non-Party) must initially be screened by a range of institutions, such as the Fatherland Front, that are closely linked to the Com- IV.4. Citizen Participation munist Party of Vietnam. This effectively in Local Governance ensures that all candidates speak more or less the same `political language' (that of Local government is the closest tier of gov- the Party) and thus implies a limitation on ernment to the citizens. As such it is the first any variation in the political programs of entry point for people to gain access to candidates. In China, free and direct elec- and influence decision-making in govern- tions of village committees have been intro- ment. In all the selected countries, citizen duced since 1987, and have become com- participation in local governance is pulsory nation wide since 1997 (15th increasingly gaining importance. The most 9. Gunter Schubert Communist Party Congress); in 2004 there common form of participation is through (2003), «Democracy were committees elected in 85% of villages the electoral system. All countries allow under one-party and 75% of neighborhood communities in local citizens to select to varying degrees rule?», China urban areas. From 1995 (first experience), the leaders who manage the affairs of the perspectives n°46, township leading positions (governor, community, ranging from the consultative March-April; Lai deputy-governor and sometimes the Party people's congress in Vietnam and China to Hairong (2004), secretary) have been subject to a semi- the directly elected councils and mayors of "Semi-competitive competitive election procedure in the Australia, India, Indonesia, Japan, Korea, elections at township level in Sichuan province of Sichuan and in some counties New Zealand, Pakistan, Philippines and province", China elsewhere. This semi-competitive proce- Thailand. The level of participation in local Perspectives n°51, dure includes as a rule a kind of primary government elections varies considerably January-February. election among self-nominated candidates throughout the selected countries. The ASIA-PACIFIC Decentralization and Local Democracy in the World 85 turnout is extremely high under the one- power of councils to hold referendums; the party communist government in Vietnam 2006 Act on the Local Ombudsman Regime (98.7% in 2004) and China (80% in village and Local Petition against the abuse of local elections in rural areas). Voting is compul- finance, and the 2007 Local Recall system, sory in four states of Australia but in the by which elected mayors and councilors rest of the country turnout in local govern- may be removed from office by a local vote. ment elections is generally low at around In New Zealand around half of all municipal- 30-40%, even where postal voting has ities have introduced some form of commu- been introduced. Elsewhere in the region nity board structure as a strategy for linking the turnout ranges from a high of around communities with the local council. Al- 80% in the Philippines to 56% (2003), though these structures are authorized in 52% (2004) and 47% (2005) in Japan, the 2002 Local Government Act, the boards New Zealand and Pakistan respectively, lack formal government authority or inde- and a low of 35% in Thailand's Bangkok pendent financial resources. Metropolitan Administration. In the Philippines there has been a noticeable However, citizen participation in local go- increase in citizen participation in local go- vernance is not merely confined to voting vernance in recent years. The 1991 Local in local government elections. The pre- Government Code established new mecha- The presence sence of decentralized structures and proces- nisms of consultation and participation. of decentralized ses has been considered one manifestation Local referendums and recall of officials of a wider movement in the region towards have been introduced and there were 29 structures and democratization because it provides the recorded local recall elections between enabling context for broader citizen partic- 1993 and 1997 (Teehankee 2002). The processes has ipation and active civil society engagement Code requires all municipalities to estab- been considered in the democratic discourse. Ensuring the lish a local development council (LDC), with participation of civil society groups (NGOs at least one-quarter of its members being one manifestation and non-profit organizations), and busi- representatives of non-governmental and of a wider ness and the private sector in the local civil society organizations. The LDC draws governance process is a continuing con- up a comprehensive development plan for movement in the cern in the region. Such participation is a approval by the council. region towards sine-qua-non for successful decentraliza- tion. How to overcome the so-called `psy- Attempts at promoting citizen participation democratization chological divide' between government often challenge powerful vested interests and civil society is a challenge that is being and are not always successful. The Gram addressed in various ways by the selected Sabha (or assembly of all registered voters countries of the region. in a panchayat) is a key feature of rural local government in India, and it is manda- Japanese citizens have extensive powers to tory for rural local bodies to hold Gram demand a local referendum ­ for example, Sabha meetings where important decisions on important issues such as US military have to be approved. There is also an relocation, nuclear sites and construction of increasing emphasis on setting up user industrial waste disposal facilities. They can groups to take decisions and to participate demand formulation, improvement or elim- in the management of public services. This ination of ordinances, audits and even dis- is more controversial as it is often seen as solution of the local assembly, as well as the a dilution of the institutional role of elected dismissal of the mayor, council members or local bodies. Currently, urban local govern- officials. In Korea, citizen participation has ment in India does not have a correspond- been greatly strengthened by three legisla- ing institution to the Gram Sabha and does tive reforms in the very recent past: the not offer any institutionalized role for ci- 2005 Local Referendum Act, confirming the tizens beyond voting at election time ASIA-PACIFIC 86 Decentralization and Local Democracy in the World In several ­although there are calls to build a ward- (World Bank: 2004). However, other sur- countries much level platform for citizen engagement. As a veys show that, despite reforms, local peo- step towards greater public accountability, ple do not see much opportunity to par- attention has been India has recently enacted a Right to Infor- ticipate in decision-making or even offer mation law, overriding earlier laws that input in the decision-making process. given to the protected government policies and deci- (Alatas, Pritchett, Wetterberg: 2002). Per- villages, because sion-making from public scrutiny. Local haps better results will come in time. government laws in some states contain of their roots their own Right to Information provisions, Large city governments face particular in traditional mandating what information must be placed challenges of representation and account- in the public domain. ability. Their large size can mean remote- patterns of social ness from citizens and voters. In terms of relations and as a In Pakistan, a major objective of the responsiveness, much depends on the pre- 2001 decentralization reform was to in- vailing institutional and electoral arrange- legitimate basis, stitutionalize community participation in ments. (Rakodi 2004). One way in which owned by the local local governance. To support this objec- cities can retain a degree of responsive- tive, one-quarter of the local development ness, particularly to the poor, is through a people, for local budget is mandated for community lower tier of government at the community development organizations. Despite this, neither com- level, such as the barangays in the Philippines, munity organizations nor participation which have access to resources for local has increased significantly. Resource service and infrastructure needs (Devas et allocation for community organizations al 2004). However, with the exception of has become highly politicized within the the OECD countries Australia, Japan, local councils. Local government laws Korea and New Zealand, which have much have also enshrined traditional dispute greater resources and longer established resolution within the formal system to traditions of local democracy, the cities of facilitate citizen participation. But these Asia-Pacific demonstrate huge problems of mechanisms have proved ineffective in lack of responsiveness to the needs of defending the interests of weaker and their citizens, particularly the poor, and a poorer members in the community. woeful lack of accountability. Their lack of responsiveness can in large part be attrib- In several countries much attention has uted to their inadequate resources, both been given to the villages, because of their human and financial. But it can also be roots in traditional patterns of social rela- attributed to weak, unaccountable and tions and as a legitimate basis, owned by opaque administrative systems, political the local people, for local development. systems that are unrepresentative and Therefore barangays are promoted in the repressive, and high levels of corruption. local government system of the Philip- In addressing these problems, demands pines. In Indonesia, the military government from civil society are increasingly forcing reorganized the villages in 1979 in order to municipal governments to practice greater integrate them in its ruling system. The transparency and accountability (ibid). decentralization reform of 1999 reversed this decision in order to revive villages in IV.5. The Political Representation rural areas as a social structure, based on of Disadvantaged and Minority customary institutions and rules, that can Groups help to integrate local people in the man- agement of local government affairs. Sur- Elite representation has tended to domi- veys have shown that the village can play nate the electoral systems in the Asia- a role in local dispute settlement instead of Pacific region, even where PR has been official police and justice ­ unless formal the norm, and especially where upper authorities are involved in the conflict tier local governments are indirectly ASIA-PACIFIC Decentralization and Local Democracy in the World 87 elected. For this reason, many countries In Pakistan on directly elected village or Strong traditions have taken affirmative action in order to neighborhood councils one seat is reserved of local elite promote the political representation of for women and one seat is reserved for disadvantaged and minority groups at peasants and workers, while on directly domination the local level. In principle, the demo- elected union councils four seats are re- in many of the cratic election of local government repre- served for Muslim women, six seats (of sentatives gives all citizens a voice. But which two are for women) for workers and countriesinthe in practice, some electoral arrangements peasants, and one seat for minority com- region mean that are more inclusive ­particularly of wo- munities. For the indirectly elected zilla, men but also of minority groups and the tehsil and town councils, women must rep- the achievement of poor­ and so can produce outcomes that resent 33% of all members while peasants more inclusive are more representative. To date there and workers must represent 5% and is no legislation in any of the selected members of minority communities in the representation is a countries in the region requiring that respective local government unions must political parties ensure that a given per- represent a further 5%. The electoral col- long-term process, centage of their candidates for local lege for filling these seats consists of the although the election are representative of minority members of the union councils in each or disadvantaged groups. However, in local government. However, a large num- growth of the civil Vietnam, the law states that the Com- ber of the reserved seats remain unfilled society movement munist Party should, when selecting or are simply not contested. Following the candidates to stand for election, ensure 2000-2001 elections, 17% of councilors at and its that an appropriate number of women the union council level were women, 15% engagement with and ethnic minority people are elected at the tehsil level and 11% at the district to the People's Councils. and city level (CLGF 2005:1183). local government is helping India, Pakistan and the Philippines have Strong traditions of local elite domination adopted electoral arrangements with in many of the countries in the region quota systems and reserved seats for mean that the achievement of more inclu- women and for disadvantaged and minor- sive representation is a long-term process, ity groups. India offers the most striking although the growth of the civil society example in terms of the positive outcome movement and its engagement with local of affirmative action in favor of women's government is helping. This has been par- and minority representation. Not less ticularly the case in the Philippines, where than one-third (including seats reserved NGOs and civil society organizations enjoy for Scheduled Castes (SC) and Scheduled quite a high degree of legal protection and Tribes (ST), of seats and chairs on all rights within the local government system. local government councils in all states are The 1991 Local Government Code states reserved for women. As a result, over one that there must be three sectoral repre- million women are serving as local go- sentatives in local councils at all tiers, i.e. vernment councilors in India. SCs and STs one woman, one agricultural or industrial also have reserved council seats ­ in the worker and one representative for the same proportion as the population of SCs urban poor, indigenous cultural communi- and STs bear to the total population. The ties, disabled persons, or any other sector requirement that a proportion of senior as may be determined by the council con- positions must be reserved for women cerned. In addition, the Philippines has and minority groups has also had an one of the most overtly `pro-youth' local empowering effect although the evidence representational systems in the world. The of the impact is mixed, with states such Local Government Code provides for the as Kerala and West Bengal making much establishment of youth councils, whose greater strides on this front than others members are elected by persons between (Blair 2000). 15 and 21 years of age, in every barangay. ASIA-PACIFIC 88 Decentralization and Local Democracy in the World The presidents of these youth councils and New Zealand makes up 15% of the total of their federations represent the youth as population, it accounted for only 6% of ex-officio members at every tier of the council members in 1998-2001. Despite local government system. the absence of affirmative action in both countries, female representation at the In Australia and New Zealand the rights of local political level is considerable. In indigenous peoples to local self-govern- 2000, 26% of council members in Aus- ment is a political issue, and one that is tralia were women and only 10% of coun- more about self-determination than about cils had no women councilors. Some 15% inclusion (Sproats 2003). In Australia, of councils had a woman mayor, more in there is a long-standing difficulty in incor- metropolitan areas (21%) than in rural porating the aboriginal population within councils (11%) (UNESCAP 2005a). In the formal governmental structures. In New Zealand, women accounted for 34% some regions, there are special local gov- of city council members and 28% of dis- ernment areas to serve the needs of the trict council members in 2004. In the aboriginal population in order to achieve same year four of the 16 city mayors and a greater degree of representation for 12% of district mayors were women them. Although the Maori population in (UNESCAP 2005b). ASIA-PACIFIC Decentralization and Local Democracy in the World 89 V. Conclusion Decentralization can open the door for `money politics,' as is the case in Indone- In considering the impact of decentralization sia, where it is often money rather than and democratic local governance on service accountability that counts (Hofman and delivery, citizen voice, accountability and Kaiser 2006). In China and Vietnam, local poverty reduction, it is important to bear in democratic choice of community leaders is mind that, while some countries in the Asia- beginning to be implemented at the vil- Pacific region have undergone significant lage level, and citizens are increasingly decentralization of government functions willing to challenge and demand account- (notably Indonesia, Philippines and some ability from local officials. In Malaysia, states in India, as well as some sectors in where there is no direct line of accounta- China, and to a lesser extent, Korea, Thai- bility because local government councilors land and Vietnam), in other countries there are appointed not elected, nevertheless have been more modest reforms to the striking innovations in terms of greater existing system of local government (Aus- public access to information are under tralia, Japan ­ but significant on local way that are intended to enhance local finance system ­ and New Zealand). De- accountability. In many countries, particu- centralization and local governance also larly in the Philippines and some Indian show widely differing degrees of local dem- states, local civil society organizations are ocratic control and accountability across the increasingly ready to use that information Decentralization region. As such, it is difficult to make gener- to demand accountability. Meanwhile, in and local alizations about such a wide range of expe- countries with well-established local rience, especially where decentralization is a administrative systems, such as Australia, governancealso comparatively recent phenomenon in com- Japan and New Zealand, much effort over show widely parison to other parts of the world. Never- the past two decades has gone into theless, two broad conclusions can be made improving the management and efficiency differingdegrees about the impact of decentralization and of local service delivery, including the of local democratic local democratic reform in the region. adoption of performance management and facilitation of citizen access to infor- control and First, in terms of the impact of democratic mation through e-governance initiatives. accountability decentralization on service delivery, there These should have had a positive impact is a degree of support from within the on local service delivery outcomes. across the region region (e.g. Indonesia, Korea, Philippines and some Indian states) for the positive Second, the available data is insufficient to view that service performance improves draw any firm conclusions yet with regard when elections are introduced for local to the impact of decentralization on poverty decision-makers, who are then obliged to reduction. In principle, in combination with become more responsive and accountable an effective and equitable resource distribu- to local citizens. Decentralization should in tion system, decentralization should spread principle open up political space for citizen the benefits of growth around more widely participation and voice, and so create the and so help to reduce poverty. On the other potential for greater accountability of deci- hand, without such an equitable system for sion makers. In India, Indonesia, Pakistan resource distribution decentralization can andthePhilippines,decentralizationhasindeed lead to an increase in inter-regional greatly increased the number of elected inequality. This is typified by China where positions, thereby increasing the scope for economic reform generally, including eco- democratic accountability. But traditions of nomic decentralization, has greatly patron-client relationships between local increased living standards and substantially elites and citizens, which are strong in reduced the numbers living in absolute many countries in the region, can seriously poverty but at the same time has substan- undermine local democratic accountability. tially increased inter-personal and inter- ASIA-PACIFIC 90 Decentralization and Local Democracy in the World regional inequality. In Indonesia, decen- that decentralization has for the most tralization has increased the resources part been accompanied by enhanced going to the local level, but this increase local democracy. But the forms and pat- has been much greater in the resource- terns of local governance have varied rich regions than elsewhere. While this widely, as have the outcomes, reflecting may help to redress historic differences the diversity of country contexts. While in the levels of development between there are clearly a great many weak- regions, it may not do so in a manner nesses in the current arrangements for that systematically addresses either decentralized governance in the case poverty or inter-regional inequality. study countries, and further reforms will undoubtedly be required, it is hard to In conclusion, it is clear that decentral- imagine that any wholesale return to a ization has become a major theme of centralized system of governance would governance reform throughout the Asia- be either appropriate or politically Pacific region over the past decade and acceptable. ASIA-PACIFIC Decentralization and Local Democracy in the World 91 Annex 1 Major Local Government Legislation in Selected Asia-Pacific Countries Country Year Australia 1989 Victoria: Local Government Act 1993 New South Wales: Local Government Act 1993 Northern Territory: Local Government Act 1993 Queensland: Local Government Act 1993 Tasmania: Local Government Act 1995 Local Government (Financial Assistance) Act 1995 Western Australia: Local Government Act 1999 South Australia: Local Government Act China No constitutional or dedicated legal basis exists for local government. The following laws are relevant for the role of sub-national governments: Comprehensive Fiscal Reform (1994), Budget Law (1995) and Tax Sharing System (1994) India 1950 Constitution (Article 40) 1992 73rd and 74th Constitutional Amendments Indonesia 1974 Law 5 on Local Autonomy 1975 Law on Decentralization (decentralisatiewet) that established autonomous regions 1999 Law 22 on Regional Government and Law 25 on Fiscal Balance between Central and Regional Government 2000 Constitutional Amendment strengthening basis for decentralization 2004 Law 32 on Regional Government (amended Law 22) and Law 33 on Fiscal Balance between Central and Regional Government (amended Law 25) Japan 1947 Local Government Law 1993 House and Diet Resolutions on Decentralization 1995 Law for the Promotion of Decentralization 1999 Global Decentralization Law 2004 Revision of 1947 Local Government Law 2005-2007 "Trinity Reform" of local finance Korea, Rep. of 1949 Local Autonomy Act, amended in 1956, 1958, 1960 and 1961 1986 Local Autonomy Law 1987 Constitution: Title V111 (Articles 117 and 118) on Local Autonomy 1990 Revised Local Autonomy Law ASIA-PACIFIC 92 Decentralization and Local Democracy in the World Annex 1 Major Local Government Legislation in Selected Asia-Pacific Countries (Cont.) Country Year Malaysia 1950 Local Authorities Elections Ordinance 1952 Local Councils Ordinance 1976 Local Government Act 2003 Smart Local Government Governance Agenda New Zealand 1989 Local Government Amendment Acts No. 1 and No. 2 1991 Resource Management Act 2001 Local Electoral Act 2002 Local Government Act 2002 Local Government (Rating) Act Pakistan 1959 Basic Democracies Order 1960 Municipal Administration Ordinance 1972 Local Government Ordinance 1979 Local Government Ordinances passed in each Province 2001 Local Government Ordinances passed in each Province 2005 Amendment to 2001 Local Government Ordinances Philippines 1959 Local Autonomy Act 1960 Barrio Charter Act 1963 Revised Barrio Charter Act 1967 Decentralization Act 1983 Local Government Code (Batas Pambansa) 1987 Constitution: Article 10 provides for local autonomy 1991 Republic Act (known as Local Government Code) Thailand 1933 Municipal Administration Act 1985 Bangkok Metropolitan Administration Act 1991 National Administrative Organization Act 1997 Constitution: Article 78 provides for local autonomy 1997 Provincial Administration Organization Act 1999 Decentralization Plan and Procedures Act ASIA-PACIFIC Decentralization and Local Democracy in the World 93 Annex 1 Major Local Government Legislation in Selected Asia-Pacific Countries (Cont.) Country Year Vietnam 1958 Law on Local Governments 1994 Law on Organization of the People's Council and the Administrative Committees at All Levels of government 1996 Ordinance on Concrete Tasks 1998 Budget Law 2004 Revised State Budget Law Source: UCLG Country Profiles (2007) and Brillantes 2006; CLGF 2005; World Bank 2005. EURASIA T. Y. KHABRIEVA (CHIEF RESEARCH GROUP) L.V. ANDRICHENKO V.A. VASILIEV1 EURASIA 96 Decentralization and Local Democracy in the World 1. The authors thank professors A. Campbell and G. Marcou for their inputs in the discussion of this chapter. EURASIA Decentralization and Local Democracy in the World 97 I. Introduction The legacy is most clearly evident in regard to the relationship between local This chapter analyzes the formation, devel- government and the state. On one hand, opment and recent trends of local self-gov- Soviet-era centralist ideas continue to ernment in the states of the Eurasian color the ruling elite's view of local auton- region that were formerly member states omy. On the other, the advocates of local of the Soviet Union: Azerbaijan, Armenia, autonomy and decentralization often adopt Belarus, Georgia, Kazakhstan, Kyrgyz excessively idealistic views of local govern- Republic, Moldova, Russia, Tajikistan, Turk- ment in their zeal to break with the insti- menistan, Ukraine and Uzbekistan. tutional legacy of the Soviet period. The first group sees local government as an Until the fall of the Soviet Union in 1991, integral part of the state and entirely sub- all these countries shared a unified system ordinate to higher-standing state bodies. After the removal of of local government. The main characteris- The second group typically regards local tics of that system were that 1) local sovi- government as a social institution created partycontrolover ets (councils) were part of the state, 2) by the people of the local community and local government soviets at each level were subordinate to entirely separate from the state. soviets at all higher levels, and 3) the bodies, local executive at each level of government was The `social' or `society' view has provided a government nominally accountable to a representative basis for defending municipalities against council but in practice both representative excessive intervention from above. It was reforms have been and executive powers at each level were this view that inspired Article 12 of the subordinated to the ruling party organiza- Russian Federal Constitution, which driven by the tion at that level. declares that local self-government is not struggle between part of the state; this has been a central Taken together these attributes of the reference point in all debates on local gov- Soviet era Soviet system of sub-national government ernment in the Russian Federation. At the centralist ideas form a legacy that continues to influence same time it can be argued that the social the evolution of sub-national government view itself limits the role of local govern- and advocates of in the successor states. In the early years ment by emphasizing its role in community decentralization of post-soviet transition this legacy was representation at the expense of delivering evident in terms of the practical difficulties services. The social view can encourage basedonthe caused by the collapse of the previous sys- fragmentation into small municipal units principle that local tem. After 1991 there were difficulties due that are powerful on paper, but not in prac- to overlapping functions and shared com- tice (as occurred in several of the countries self-government petencies, as well as the lack of a clear of Central and Eastern Europe after 1989). is not part relationship between functions, responsi- bilities and resources, whether generated However, as long as the `state' view of of the state locally or transferred from higher levels. local government remains influential in The removal of party control over the governmental circles, the social view is executive and representative powers necessary as a countervailing force. The opened a power struggle between the two debate between these opposing views of branches in those countries in the region local government tends to coalesce around where genuine democratic elections were the key issue of whether mayors are applied at sub-national levels. appointed or elected ­or, in a non-mayoral system, whether the elected council has However, it is at the level of ideas ­the power over the executive. This matter is ideas that have informed the debate effectively the working litmus test of local around local government reform in autonomy. This can be seen in the recur- Eurasian countries­ that the Soviet legacy rent debate within the Russian Federation can be seen to have enduring influence. regarding appointment of mayors. On sev- EURASIA 98 Decentralization and Local Democracy in the World eral occasions in recent years, draft legis- and leaving settlement-based municipali- lation that would have introduced appoint- ties to do the rest. In Georgia the munici- ment rather than election of mayors has pal reform has transformed the districts come close to adoption, only to be with- (raiony) in municipalities and cities without drawn at the final stage. This reflects the subordination to any raion into self-govern- fact that proponents of both views of local ing cities. Raiony continue to provide the government can be found at the highest basis for central Asian local government levels of government. In the post-Soviet systems, although local self-government context the principle of local autonomy has (in the sense of local autonomy) is confined Three groups of often come into collision with that of to the sub-raion level where there are few countries can be regional autonomy. Nowhere more than in functions. In cases such as the local the Russian Federation from the early makhallas in Uzbekistan, services are pro- distinguished: 1990s onwards has conflict between vided at this level, but genuine autonomy is 1) where local regional governors and mayors of regional restricted. capital cities shaped local politics and government has development, sometimes over many Local self-government in the states of the been years. In this case regional governors have Eurasian region has attained different lev- frequently supported the state view of els of institutional development. In several established as local government, whereby local authori- states it exists as an independent institu- separate from ties would be subordinate to regional state tion; in others it is a structure combined bodies. Advocates of the social or non- with the institutions of state power. In this the state power; state view of local government may, para- respect it is possible to distinguish three doxically, be found at the higher national groups of countries. 2) where the reform or federal levels. process is still In the first group are Russia, Armenia and Most Eurasian countries have inherited in Azerbaijan. In these countries local self- not concluded; some form the Soviet territorial unit, the government is legally autonomous and 3) where local raion, consisting of a number of different institutionally separate from the structures settlements over a particular territory of state power, and local government is issues are still in (much like a UK district). In most coun- seen as an institution through which the the hands tries in the region this is where most local local community decides on local issues. functions and services are performed. Ini- of local tially much criticized as a legacy of the pre- In the second group ­Georgia, Kyrgyz state bodies, vious regime, the raion has proved difficult Republic, Moldova and Ukraine­ the to replace. In Ukraine perhaps the most process of the formation of local self-gov- whereas local important of the reforms designed in 2005 ernment is still not concluded. Reforms self-government (but not adopted, due to that year's split in have barely been implemented, or simply the Orange coalition) was that which would have not been achieved up to now. The exists only at have made the raions into genuine local aforesaid trend in the development of local the very lowest authorities, with the executive reporting to self-government has been changed neither the council; councils currently have no in the course of the Ukrainian "orange rev- level executive reporting to them. In Russia the olution," nor in the course of the "revolu- reform of 1995 emphasized settlements tion of roses" in Georgia. rather than districts. As a consequence, many local functions were exercised by the The third group is composed of the states state. The 2003 reform ended this anom- of Central Asia: Kazakhstan, Tajikistan, aly, creating a two-tier system with raions Turkmenistan and Uzbekistan. Local self- as the upper tier to carry out those local government there functions only on the functions that required economies of scale lowest level, in small villages. In the main, (in addition to certain delegated state func- local issues in this region are vested in tions, as in the German/Austrian model) local state organs subordinate to central EURASIA Decentralization and Local Democracy in the World 99 Table 1 General Information and Territorial Structure Countries Territory Population Administrative territorial Local units and tiers Form of government (1000 sq. km) (m) division (intermediate level) Armenia 29.74 3.21 (census 10 regions 930 municipal units Unitary state with mixed of 2001) City of Erevan presidential-parliamentary government Azerbaijan 86.6 8.4 Nakhichevan Autonomous Republic 59 districts Unitary state with presidential (Nagorno-Karabakh) 11 district cities government de facto secessionist republic 2,757 municipalities Belarus 207.6 9.75 6 regions 1.665 municipal units: Unitary state with presidential City of Minsk 1) district (basic) government 2) primary Georgia 69.7 4.661 9 districts, 1,017 municipal units Unitary state with presidential 9 cities, Abkhaz and Adjar government Autonomous republics Kazakhstan 2. 724 15.074 14 regions 1) 159 districts and 36 district cities Unitary state with presidential 3 cities 2) 45 cities, 241 boroughs, government 2,042 rural circuits Kyrgyz Rep. 198. 5 4.823 (census 7 regions 1) 40 districts and 10 district cities Unitary state with presidential of 1999) City of Bishkek 2) 11 cities and 465 rural municipalities government Moldova 33.8 4,466 1 autonomous territorial 1) 32 districts and Unitary state with entity ­ Gagauz Eri 3 cities parliamentary government 1 territorial unit ­ Stinga Nistrului 2) 907 municipalities and communities "Prednestrovye Moldavian" de facto Republic struggling for secession Russia 17,075.2 142.893 84Federationsubjects.Russiaisafederation 22.972 municipal units (at 01/01/2007) Federative state with comprised of 86 "subjects". These subjects 1) 1,802 municipal districts, and 522 district cities presidential government have equal federal rights and an equal 2) 19,892 rural municipalities and representation (two delegates each) in the 1,756 urban municipalities council of the Federation, but with varying degrees of autonomy. For the composition of legal units see Table 1 (p 97) (member states at 01/03/2008) 21 republics, 47 oblast, 8 kraj 1 autonomous oblast 6 autonomous okrugs Tajikistan 143.1 7.32 2 regions 1) 58 districts and 23 cities Unitary state with presidential 1 autonomous region Nagorno-Badakhshan 2) 47 towns, 256 settlements and 2,803 villages government Turkmenistan 491.2 5.37 (census 5 regions 1) 50 districts Unitary state with presidential of 2001) 2) Several hundred cities, settlements and villages government Ukraine 603.7 48 24 regions 1) 490 districts and 176 cities with district status Unitary state with mixed Autonomous Republic of Crimea 2) 279 cities of district subordination, 884 urban presidential-parliamentary 2 cities with the status of Regions municipalities and 28,573 rural settlements government (Kiev and Sevastopol) (however 10,227 councils) Uzbekistan 448.9 26 12 regions, 233 urban municipalities Unitary state with presidential City of Tashkent 164 rural municipalities government Autonomous Republic of Karakalpakstan About 10,000 local communities (makhalyas) Sources: UCLG Country Profiles (2007). EURASIA 100 Decentralization and Local Democracy in the World Several government. Nevertheless, first steps of tative bodies of local self-government and constitutions reform are in progress, aiming to increase dismissal of heads of municipalities. the role of local self-government and to prohibit the enlarge its functions. The constitutions of all states of the region contain separate articles, sections or dissolution of Another model of local self-government norms devoted to local self-government representative has developed in Belarus with a peculiar and to guarantees of its realization. They combination of different elements of cen- proclaim that the rights of citizens to local bodies of local tral state government, local state govern- self-government may not be restricted. self-government ment and local self-government. The constitutions of several states, includ- ing Russia and Ukraine, stipulate that the (municipal Table 1 describes the territorial structures rights of citizens to local self-government councils) of the countries of the region in relation may be suspended only in the time of war with geographic and demographic data. It or emergency. Constitutions regulate rela- distinguishes the intermediate level of tionships between central and local go- government (meso level) from the sepa- verning bodies on such principles as: sep- rate local (municipal) level; the latter may aration of state powers and powers of local be organized with a single tier or two tiers self-government, organizational and func- (see below, section 1). tional independence of local self-govern- ment in the sphere of its competence, unity and integrity of state territory, com- II. Evolution of Structures bination of centralization and decentraliza- tion in the execution of state power, bal- Territorial and institutional structures re- anced social and economic development of flect both the introduction of new political territories, and responsibility of bodies and and legal principles, and the legacy of the employees of local self-government to the past. state. Some constitutions, including that of Uzbekistan, prescribe that relations II.1. The Renaissance of Local Self- between central and local governments Government and Its Constitutional Basis shall be built on the basis of subordination and mutual cooperation. The first time the term `local self-govern- ment' was used in the law of the USSR was With the exception of Kazakhstan, all con- in the "General Fundamentals of Local Self- stitutions prescribe the principal powers of Government and Local Economies," enacted local authorities. Transfer of such powers on the wave of democratization at the end to other entities and persons is not permi- of the 1980s and the beginning of the tted. The constitutions of Russia and Ka- 1990s. zakhstan proclaim the principle of separation of state and local governments. After the collapse of the Soviet Union, each of the states has been independently devel- Several constitutions, including Armenia's, oping its own model of local government. prohibit the dissolution of representative Nevertheless, the common heritage of the bodies of local self-government (municipal past is manifest in many current legal councils). This serves as an important guar- notions including: local self-government, antee of their independence. In a number of local state government, local state adminis- states there are procedures for revocation tration, own and delegated powers, munic- and suspension of acts of local state entities ipal budgets, municipal property, programs and local self-government, and for the right of economic and social development of of citizens to lodge complaints in courts municipal entities, local public service, pre- against their decisions. Belarus and Uzbek- mature termination of powers of represen- istan provide examples of this system. EURASIA Decentralization and Local Democracy in the World 101 The constitutions of several states pro- In Armenia, the present system of local The constitutions claim guarantees for the integrity of the self-government was formed on the basis of of several states boundaries of local territories; in particular the Constitution of 1995. Between 1995 a local referendum is required to change and 1997 the Parliament enacted laws "On proclaim the boundaries of municipal units (Arme- Elections of Organs of Local Self-govern- guarantees for the nia). Although virtually all constitutions ment," "On Local Self-Government," "Tran- have detailed norms providing for the sitional Provisions for Regulating Rela- integrityofthe development of local self-government, in tionships of Organs of Local boundaries of local practice they have been implemented at Self-Government," "Organs of Territorial different degrees. Government" and some other acts. This territories; in was the period of formation of the legal and Stages of development particular a local institutional basis of the systems of state territorial government and local self-gov- referendum is Local self-government in the states of ernment. Local self-government was Eurasia has achieved different stages of defined as the right and ability of communi- required to change development. In several states it is func- ties to decide upon and take responsibility the boundaries of tioning as an independent institution, in for local issues deemed to be in the inter- others as a structure combined with, or ests of local populations. municipal units subordinated to state power. Again, the (Armenia) countries fall into three groups. In Azerbaijan the Constitution of 1995 contained a separate section devoted to In the first group of countries, including local self-government. The constitutional Russia, Armenia and Azerbaijan, local self- requirements were implemented in 1999 in government is independent: it is separate the laws "On the Status of Municipalities" from the system of state-level government and "On Elections to Municipalities," which bodies; local representative bodies inde- laid down the basis of the system of local pendently decide local issues. self-government in the republic. Later about 20 other laws were enacted, includ- In Russia the system of local self-govern- ing "On Transfer of Property to Municipal ment was launched in 1991 by the law "On Property," "On Municipal Service," "On the Local Self-government in the RSFSR." Status of Members of Municipalities," "On Later the Constitution of the Russian Fed- Fundamentals of Municipal Finances," "On eration of 1993 guaranteed local self-gov- Management of Municipal Lands" and "On ernment by providing that local self-gov- Administrative Supervision Over Activities ernment bodies shall be separated from of Municipalities." All of these laws re- the system of state power (article 12). In inforced the organizational, legal and eco- 1995 the federal law "On General Princi- nomic basis of local self-government. ples of Organization of Local Self-Govern- ment" was enacted. It proclaimed demo- In the second group of states ­Georgia, cratic fundamentals of local Kyrgyz Republic, Moldova and Ukraine­ self-government, though they have not the process of the formation of local self- been fully implemented. Therefore in 2003 government is still in progress. a new law was enacted "On General Princi- ples of Organization of Local Self-Govern- The Constitution of Georgia of 1995 pro- ment" (Federal Law No. 131), which claimed the general principle that local enlarged, in accordance with the require- issues have to be the responsibility of local ments of the European Charter of Local self-governments, subject to an obligation Self-Government, the functions of munici- to respect the sovereignty of the state. pal entities, and transferred some func- The procedure of formation and the pow- tions from member states to federal state ers of local self-governments and their bodies. relationships with state entities were regu- EURASIA 102 Decentralization and Local Democracy in the World The constitutions lated by the "Organic Law" of 1997. During known as gromada. But these principles of the states of the municipal reform of 2000­2001, the have not been fully realized. Currently a powers of local self-government were sig- mixed system exists, combining local state Central Asia nificantly enlarged, but were not ade- government and local self-government on quately supported by necessary material the levels of districts (raion) and regions acknowledge and resources. This divergence was one of the (oblast). On one side are provincial and guarantee local main themes of debates in the last local district councils as elements of local self- elections held on October 5th, 2006. government, representing the interests of self-government. territorial gromadas. On the other are But on the whole, In Kyrgyz Republic the basis for local self- state administrations of provinces and dis- government was established by the Consti- tricts ­local organs of state executive po- local matters are tution and laws "On Local Self-Government wer vested with the executive functions of not the business and Local State Administration," "On the these councils. Such a combination of Financial and Economic Basis of Local Self- municipal and state structures actually de- of local Government," "On Municipal Property" and rogates principles of local self-government, self-goverment "On Municipal Service." The new stage of leaving it in the domain of state rule. Re- the reforms has been initiated by the form projects have faltered because of po- bodies "National Strategy On Decentralization of litical divisions and are still pending. State Government and the Development of Local Self-Government in the Kyrgyz The third group is composed of the coun- Republic for the Period till 2010." Neverthe- tries of Central Asia ­Kazakhstan, Tajikistan, less, local issues are still under the control Turkmenistan and Uzbekistan. In these of the state's local administrative entity. nations local self-government functions only on the lowest level, in small villages vari- In Moldova the democratic fundamentals ously called jamoaty, shakhrak and dekhot of local self-government were laid down by in Tajikistan, and makhalya in Uzbekistan. the Constitution of 1994. In fact, the It is nevertheless necessary to note that process was launched four years later with these states are in the process of imple- the adoption of the laws "On Local Public menting reforms to increase the role of local Administration" and "On Territorial-Admin- self-governments and to enlarge their func- istrative Organization." The division of the tions. In Kazakhstan, for example, recently territory at the intermediate level has been approved legislation will introduce elections changed twice: from districts (raion) to for municipal heads (mayors). provinces (judete), and back to districts. The next stage of municipal reform started The constitutions of the states of Central in 2003, when the Parliament amended Asia acknowledge and guarantee local self- the legislation by significantly enlarging government. Some laws of these republics the powers of local self-government. Nev- contain original definitions of the notion of ertheless, many problems were not local self-government. Thus, the "Law of resolved. The material basis of local self- Uzbekistan On Organs of Self-Government government is still not sufficient and its of Citizens" defines local self-government independence from state powers is not as an independent activity of citizens in duly ensured. the solution of local issues in accord with their interests, historical development, In Ukraine the fundamentals of local self- national and spiritual values, local customs government were shaped by the Constitu- and traditions. tion of 1996 and by the law "On Local Self- Government in Ukraine" (May the 21st. But on the whole, local matters in these 1997). They proclaimed the principles of countries are not the business of local self- decentralization of public powers and the government, an autonomous or quasi- priority of territorial units or communities independent body elected by local popular EURASIA Decentralization and Local Democracy in the World 103 vote. Rather, control of local matters more republics), Moldova (Gagauz Eri, "Pred- Most countries have often falls to what is termed "local state niestrovye Republic"), Ukraine (Crimea), introduced or government" (Kazakhstan), "state power Tajikistan (Nagorno-Badakhstan) and on local level" (Tajikistan and Uzbekistan) Uzbekistan (Karakalpakstan). allowed and "local state executive power" (Turk- autonomous menistan). Russia is the only federal country in this region. However, several countries have an territorialunitsin Another model of local self-government intermediate level of government on a recognition of has been developed in Belarus. The "Law rather broad scale, distinct from the local On Local Government and Self-Govern- or municipal level of government. It is ethnic or regional ment in the Republic of Belarus" esta- generally called oblast, here translated as peculiarities, blished a peculiar combination of different "region" and it is found in Armenia, elements of central state government, Belarus, Kazakhstan, Kyrgyz Republic, sometimes with local state government and local self-gov- Tajikistan, Turkmenistan, Ukraine and ernment. Local self-government--as Uzbekistan. Georgia also has such a terri- a dimension opposed to the notion of a state-controlled torial level (mkhare). The capital city and of conflict local body ­is defined as the organization other main cities may have the status of and activities of citizens for independent province; that is, they are directly subject solution of local issues, directly or through to the central government. elected entities. This definition takes in to account the interests of the population, Usually the local government level (munic- the development of administrative territo- ipal level) is organized on two tiers, as rial units and the basis of own material and reflected in Table 1. The most important is financial resources local government can the district level, which is a rather small generate or attract. But at each of the three constituency, embracing a lot of villages levels (province, district or city with district but also some cities. Many municipal func- rights, rural or urban municipality) execu- tions for small and mid-size cities are the tive powers are integrated in the system of realm of district-level powers; large cities the state executive power, even though are independent of the district-level they are, at the same time, bodies of local authorities. Usually, the lower municipal government. Local councils therefore do level is much less significant with respect to not have their own executive powers. its functions. This pattern can be compared with the German municipal organization (Kreis-district, and cities independent from II.2. Territorial Organization a district) or to English districts; it was also and Territorial Reforms used in the Soviet era. Now, such a two- level municipal organization can be seen in The countries of the region have different Azerbaijan, Belarus, Kazakhstan, Kyrgyz forms of territorial organization of public Republic, Moldova, Russia, Tajikistan and power. As a rule, these forms are highly Ukraine. Only one municipal level, although diversified, but not all countries have a it may be differentiated, exists in Armenia, clear hierarchy of territorial units with local Georgia and Uzbekistan. In Turkmenistan, self-government organs, as reflected above local government institutions exist only at in Table 1. the district level. The level of local govern- ment autonomy varies considerably, even Most countries have introduced or allowed among similar countries. autonomous territorial units in recognition of ethnic or regional peculiarities, some- In further detail, Russia, as a federative times with a dimension of conflict: Azer- state, is composed of such member states baijan (Nakhichevan and Nagorno- (called "`subjects") as republics, lands Karabakh), Georgia (Abkhaz and Adjar (krai), regions (oblast), federal cities, EURASIA 104 Decentralization and Local Democracy in the World autonomous regions and autonomous cir- population prevails also in other states of cuits (okrug). All member states of the Central Asia. The legislation of Kazakhstan Russian Federation have equal status. Local (law of December 8th, 1993) distinguishes self-government in the Russian Federation the administration of territories and of pop- is exercised in urban settlements and rural ulated areas. Territories are provinces, dis- settlements formed as municipalities (pose- tricts and rural circuits; populated areas are lenie), municipal districts (municipalnij ra- cities, settlements and villages. This means yon), district cities (gorodskoï okrug) and that the municipal area is usually limited to the territories of federal cities (Moscow and the settlements, whereas areas between St. Petersburg). populated areas are administered by the upper level of government. The new law on In Ukraine the administrative-territorial or- local government of the Russian Federation ganization has a three-tier structure: the is backing away from this conception, and highest level includes the Autonomous Re- the territory of each subject of the Federa- public of Crimea, regions (oblast) and two tion is divided into municipalities; only in cities, Kiev and Sevastopol that have a areas of low density may the territory special status. The next level, the upper between municipalities be administered by municipal level, embraces districts and dis- the district government (law 131: article trict cities. The lowest level includes city 11, paragraph 1). districts, cities of district subordination, towns, settlements and villages. A number of countries have implemented territorial reforms after the political change, The territory of Tajikistan is divided in a aimed, inter alia, at improving state govern- Usually the local descending hierarchy into provinces (veloy- ment (Belarus, Georgia, Kazakhstan, level is two tier, with ats), districts (nohiyas), towns of republican Moldova, Russia, Ukraine and Uzbekistan). significance, towns of provincial significance, Major goals and trends of territorial reforms the raion being still towns of district significance, settlements were different. In a number of states they the key and villages (qyshloqs). resulted in the enlargement of regional ter- ritorial units (Kazakhstan, Ukraine). In other In the countries of Central Asia (Kaza- states territorial reform was called upon to khstan, Tajikistan, Turkmenistan and move the processes of public power closer to Uzbekistan), local self-government plays a the general population (Azerbaijan, Arme- limited role. Organs of local state govern- nia, Russia, Uzbekistan). ment exercise the principal functions. In Russia, Azerbaijan, Armenia, Georgia, Kyr- In the Russian Federation, territorial reform gyz Republic and Moldova, local self-gov- has been in the process of implementation ernment has greater autonomy and is sep- since 2003. According to the Law of 2003, arated from state government. the subjects of the Federation have fixed boundaries of municipal entities, and have In the majority of countries of the region defined the status of appropriate local enti- the majority of the population resides in ties as urban or rural settlements, munici- cities and towns. Statistics show that, on pal districts (municipalniï rayon) and dis- January 1, 2006, 73% of the population of trict cities (gorodskoï okrug). The year the Russian Federation resided in urban 2005 was decisive in the establishment of settlements and 27% resided in rural the two-tier model of local self-government regions. Urban population slightly exceeds in Russia. The member states of the Russ- 70% of the population in Belarus, 68% in ian Federation have fixed the boundaries of Ukraine and nearly 60% in Kazakhstan. By 23,972 local entities, including 19,892 rural contrast, in Uzbekistan, at the beginning of municipalities, 1,756 urban municipalities, 2006, 36% of the population resided in 1,802 municipal districts and 522 district cities and 64% in rural regions. Rural cities (January 1st 2007). EURASIA Decentralization and Local Democracy in the World 105 Capitals and Metropolitan Areas Table 2 Capital Cities and Main Cities In the majority of countries, capital cities Countries Capitals and metropolitan cities Population (thousand) have separate legal status as provided by constitutions and laws (Belarus, Kazakhstan, Armenia Erevan 1,104 Russia and Ukraine ­see Table 1). In the Azerbaijan Baku 1,874 Russian Federation the separate regime of Moscow is laid down by the Constitution and Belarus Minsk 1,781 the law "On the Status of the Capital City of the Russian Federation." In Uzbekistan the Georgia Tbilisi 1,103 separate legal regime of the capital city is provided only by the Constitution. By con- Kazakhstan Astana 550 trast, Baku, the capital of Azerbaijan, does Kazakhstan Almaaty 1,248 not have any special regime. Kyrgyz Republic Bishkek 799 Several states have metropolitan areas with special governance status. Under the Consti- Moldova Chisinau 660 tution of the Russian Federation two metro- politan areas ­Moscow and St. Petersburg­ Russia Moscow 10,425 have the status of the member states of the Russia St. Petersburg 4,581 federation. Law provides for specific legal regulation of their local self-government Russia Novosibirsk 1,397 forms. According to the charters of Moscow and St. Petersburg, local self-government is Russia Nizhni Novgorod 1,284 exercised by institutions of local self-govern- Russia ment formed in appropriate city territories. Ekaterinburg 1,308 The enumeration of local issues and sources Russia Samara 1,143 of revenues of the local budgets of the municipal units are determined by the laws Russia Omsk 1,139 of Moscow and St. Petersburg, taking into account the necessity of preserving the unity Russia Kazan 1,113 of the cities' economic systems. Russia Chelyabinsk 1,093 In Georgia, similar special forms of gover- Russia Rostov-on-Don 1,055 nance are applied to Tbilisi and Poti, in Belarus for Minsk, and in Kazakhstan for the Russia Ufa 1,030 cities of Astana and Alma-Ata. Expenditures of the capital cities are singled out in each Tajikistan Dushanbe 647 republic's budget; the cities receive grants Turkmenistan Ashkhabad 828 and subventions, transfers of property and state guarantees for investments. In Ka- Ukraine Kiev 2,693 zakhstan, separate governance rules are provided for Alma-Ata to support the devel- Ukraine Kharkov 1,463 opment of the city as the region's interna- tional financial center. In Georgia, specific Ukraine Dnepropetrovsk 1,047 status is accorded Poti with the aim to cre- Ukraine Donetsk 994 ate a free economic zone. Ukraine Odessa 1,002 The following table lists the capitals and main cities of the countries of the region Uzbekistan Tashkent 2,141 (2006). Source: Inter-State Committee of Statistics of the Commonwealth of Independent States. EURASIA 106 Decentralization and Local Democracy in the World II.3. Evolution of Relationships between of funds inevitably impedes the execution of Central and Local Governments local-government functions. Relationships between central government Local taxes. The principal indicator of finan- and local self-government are complex. As cial power of local self-government is the right a rule, they cooperate closely. For instance, to impose taxes. In most countries of the in Russia federal state institutions and those region, the share of local taxes in the total of local self-government have agreements of revenue of local government is extremely low. cooperation, and jointly participate in the Azerbaijan is an exception, with the share of realization of special programs. local taxes and duties in municipal budgets reaching 24.5% (of this, 22.6% is attributed Different state structures are responsible to local taxes). for local government matters. In the Russ- ian Federation, a decree of the President In Armenia, local communities may levy only established a specialized ministry ­the Mi- local fees and payments. Rates of local fees, nistry of Regional Development of the within the frameworks prescribed by law, are In theory, Russian Federation­ which is vested, inter set by municipal councils at the initiatives of resources have to alia, with the powers to determine and headsofmunicipalitiespriortotheadoptionof implement the policy of the state in the annual budgets. Rates of local duties are be sufficient for sphere of local self-government. In defined by municipal councils on the propos- functions Moldova, the Agency of Regional Develop- als of heads of municipalities in the sums nec- ment performs such functions. essary for exercising appropriate actions. On (connexity November 27, 2005, constitutional amend- In other states, matters of local govern- mentswereadoptedpermittingtheimposition principle); in ment lie mainly in the province of sectoral of local taxes. practice functions departments of appropriate state bodies. Thus, in Azerbaijan the Administration of The Constitution of Belarus (article 121) and are adjusted to the President has a division responsible for annual laws on the republic's budget enumer- resources, and work with municipalities; the Ministry of ate local taxes and duties that may be estab- Justice has formed a specialized center on lished by local councils of deputies. For adequacy depends matters of local self-government; in the instance, the law "On the Budget of the on the financial Parliament there is a standing committee Republic of Belarus for 2006" prescribes the on regional issues. following local taxes and duties for the 2006 capacity of the financial year: tax on retail sale, tax on serv- public budgets III. Functions, Management ices, special purpose duties, duties from and Finances users, duties from purveyors, and health- resort duties. The share of local taxes and In theory, resources have to be sufficient duties in state revenues is about 2.1%. for functions (connexity principle); in prac- tice functions are adjusted to resources, The Russian Federation has only two local and adequacy depends on the financial taxes: the land tax and the tax on physical capacity of the public budgets. However, personal property. Representative bodies of much has still to be done to improve the local self-government define, within the financial system and the management in framework provided by the Tax Code of the order to use scarce resources more effec- Russian Federation, tax rates and the proce- tively. dure and terms for paying taxes. Other ele- ments of local taxation are prescribed by the III.1. Financial Management Tax Code. According to preliminary data for 2005, local taxes comprise only 4.29% of rev- The most acute problem of local government enues of local budgets. Local self-govern- istheshortageoffinancialresources.Thislack ments in the Russian Federation have been EURASIA Decentralization and Local Democracy in the World 107 constantly losing their local, own sources of governments. Local budgets receive 50% of revenues.TheLawofDecember21,1991"On theincometaxoncorporateentities,and50% FundamentalsoftheTaxSystem"providedfor of the excises levied on certain specified 23 kinds of local taxes and duties. Even so, in goods. Income tax on personal property, 1998theyyieldedonaverage12%ofthetotal social, land and transport taxes, and pay- municipal revenues. Furthermore, local ments for the use of water and forest authorities could vary the rates within narrow resourcesarewhollydirectedtolocalbudgets. limits for only eight of the 23. The same num- Certain kinds of duties are also considered tax ber of local taxes and payments was pre- revenues. served by the initial version of the Tax Code of the Russian Federation enacted on July 31, Reinforcement of the revenue base of local 1998. Later this list was reduced to five in budgets is exercised by increasing the share 2000. With the amendments of 2004 to the of taxes left to local budgets at the expense of budget code, proposals to transfer the tax on statetaxes;suchisthecaseinUzbekistanand vehicles to municipal budgets and to establish Kazakhstan, for instance. In Belarus, the a local tax on retail sales were rejected, and share of state taxes and duties makes up two local taxes remain ­the land tax and the more than 14% of local budget revenue. In tax on personal property. Ukraine, since the adoptions of a new budget code in 2001, the personal income tax is fully In Ukraine, bodies of local self-government devoted to local budgets of the respective lev- may establish, in accordance with law, local els (province, district, municipality) in propor- Local bodies in the taxes and duties, which are allocated to tions fixed by the law. appropriate budgets. Meetings of citizens may states of Central introduce local duties on the principles of vol- Since Russia is a federal country, the bulk of Asia are not untary self-taxation. In 2005, local taxes and local budgets depends on the budget and the duties comprised 2.4% of the general rev- policy choices of the subjects of the Fede- permitted enues of local budgets. ration, within the framework designed by the independence in Budget Code. The tax base of the subjects of Local bodies in the states of Central Asia are the Federation has been strengthened in 2004 the tax and budget not permitted independence in the tax and and 2005 with the transfer of the transporta- spheres budget spheres. They are not able to define tion tax and of the tax on assets of legal per- tax rates or other elements of local taxation. sons. Part of the current revenues of the sub- Tax rates and other elements of taxation are ject has to be reallocated to local budgets. prescribed by central bodies for all taxes, Laws of the subjects of the Federation grant including local levies. In Uzbekistan, the Cab- additional assignments of tax revenues from inet of Ministers establishes local taxes and regional budgets. As a rule, such assignments theirrates.InKyrgyzRepublic,localtaxesand are to be made at uniform rates, except that duties may be introduced only by the Parlia- differential assignments may be established in ment.Onthewhole,localtaxesaccountforan cases provided by law for the period from insignificant share in the revenues of local 2006 to 2008. In 2005, assignments of taxes budgets. comprised 36.7% of local budget revenues. Theshareoflocalbudgetrevenuesofthetotal Tax shares. In all countries of the region, tax budgetary funds of the Russian Federation shares accrued to local government on the (including regional and local) comprises 10%. revenue from national taxes are the main source of revenue for local budgets. This is Budgetary transfer. Transfers have two generally a share of the local yield of the main functions: national taxes. · bring revenues in line with spending requirements to accommodate disparities in InKazakhstan,lawdoesnotprovideforadivi- the revenue base and in needs, sion of taxes between the republic and local · compensate the costs of duties assigned to EURASIA 108 Decentralization and Local Democracy in the World To provide subsidies local government by central or regional gov- of the Federation through district funds for for shared financing ernments.Subsidiesarespecificallyusedfor the support of municipalities, and through the latter purpose. Efficiency and equity regional funds for the support of municipal of investment require transparency and objectivity in districts and city districts. There is also a resource allocation. Budgetary reforms in regional support fund for municipalities programs and Russia, Ukraine and several other major receiving contributions from the district development countries in the region are oriented in that funds. Grants are distributed among munici- direction. However, in a number of coun- pal units in accordance with the methods of the public tries, the grant allocation formula does not approved by laws of the subjects of the Fe- infrastructure of exist, or is too complicated and cannot be deration, and in conformity with the require- supported by appropriated data. mentsoftheBudgetCodeoftheRussianFed- municipal units, eration. The provisions of the Budget Code the subjects of the In Ukraine, the equalization grant for some exclude arbitrary distribution of grants. They 700 main local budgets is calculated by the have to be distributed among municipal units Russian Federation difference between spending needs estab- in an "automatic way." The situation varies may establish funds lished from a formula devised by the central considerably from one subject to another, and government, and the revenues from tax shar- not only for geographic reasons, but also due for municipal ing. This also includes a coefficient determin- to the mechanisms and levels of redistribu- development ing the level of equalization. The only needs tion of resources between local governments, that are taken into account are those listed in and whether the transfers are based on the budget code, such as education, social spending or needs estimates. On one hand care,andprimaryhealthcare.Otherfunctions the spending power is centralized, leaving (housing, basic service delivery, infrastruc- only the management to local authorities ture, public transport) have to be funded on (e.g. the regions of Novosibirsk and Tiumen), the basis of own resources; that is, local taxes or on the other hand the expenditure respon- and fees. Although the system is sound in its sibility is delegated (e.g.in the region of basic principles, it has been biased by modifi- Lipetsk). However, the consequences of the cations by the government and by multiple reduction of social privileges by federal law decisions affecting the resources and tasks of 122 of 2004, and continuous shifts in the allo- local governments. Nevertheless, a similar cation of tasks since 2004 make any evalua- equalization scheme has been introduced at tion of the transfer and equalization system 2. Editor's note: thedistrictlevelformunicipalities.Inbrief,the prohibitively complex. according to insufficiency of own resources leads to under- definitions given by financing of functions not taken into account To provide subsidies for shared financing of the Budgetary Code of the Russian in the distribution of resources between differ- investment programs and development of the Federation (art.6), ent local governments. public infrastructure of municipal units, the grants are budgetary subjects of the Russian Federation may estab- transfers to cover In Russia, more discretion is left to the sub- lish funds for municipal development. Funds current jects of the Federation than is permitted for for mutual financing of high priority social expenditures; Ukrainian regions in the matter of resource expenditures may also be included in subject subventions are allocation to the local budgets. Basic re- budgets. Municipal units may receive other budgetary transfers sources are tax shares from personal income forms of financial aid from the federal budget aimed at financing tax and shares of regional taxes as deter- and from budgets of the subjects. The main specific expenditures mined by laws of the subjects of the Fede- requirement is the transparency of distribu- (delegated ration. But the principle of equalization is sim- tion of financial resources. functions), and ilar: there is an estimate of needs based on subsidies are budgetary transfers expenditure standards, and an equalization AccordingtodatafromtheMinistryofFinances, as participation in grant to cover the gap between the revenues in 2005 budgetary transfers to local budgets the financing of and the level of equalization required by the totaled 52.5% of local budget expenditures. In specific law. Part of the income tax is also involved in the total volume of transfers 54% were sub- expenditures. equalization. Grants are paid by the subjects ventions, 32% grants and 14% subsidies2. EURASIA Decentralization and Local Democracy in the World 109 Table 3 Local Finance Indicators (Various Years) Country Totalpublic Localpublic Ratiooflocalon Taxsharesand Localtax expenditure expenditure generalpublic budgetary transfersas revenues (%GDP) (%GDP) expenditures %ofthetotalincome as%oftotalincome Armenia (2003) 20.6% 1.3% N/A N/A N/A Azerbaijan (2003) 17.8% 0.2% 27.5% (1999) Subsidies: 10.4% 22.6% Belarus (2004) 48% 19.3 % 40.1 % Basic level budget transfers: 45.6% Local taxes and payments: 2,1% Georgia 13.9% (2003) 4.6% (2005) N/A N/A N/A Kazakhstan (2004) 22.1% 10.8% 48% Transfers: 37.1% Local gvt bodies may not establish taxes Kyrgyz Rep. (2005) 28.7% 3.4% 12% N/A N/A Moldova (2003) 25% 7.2% 29% N/A N/A Russia (2005) 18% 5.3 % 18% Transfers to local budgets: 52.5% 4.29 % Ukraine (2005) 45.2% 11% N/A N/A 2.4 % Uzbekistan (2005) 32.5% 23% 55% Subsidies covering budget deficits: 16.2% N/A (estimations) Sources: Domestic sources, UNDP, World Bank as compiled by authors; data on Tajikistan and Turkmenistan are insufficient or not available. It could not be verified whether all data are calculated on the same basis, in particular due to extra-budgetary funds. The study of the dynamics of the correla- used to cover deficits. In Kazakhstan, the tion of expenditures of local budgets to share of grants is high and has a tendency GDP shows a downward trend. Thus, in the to grow: in 2004 by 19.81%, in 2005 by Russian Federation the share of GDP allo- 25.28% and in 2006 by 37.1%. A similar cated to local budget expenditures was tendency can be observed in several coun- 6.5% in 2003, 6.2% in 2004, and 5.3% in tries, such as Ukraine and Georgia. This 2005. reflects the low buoyancy of tax shares compared to expenditure needs that are On January 1, 2006, the share of local ex- growing faster. penditures in the general volume of public services consumed 18% of the consoli- Financial provisions for certain state func- dated budget of the Russian Federation, tions delegated to local self-government and 40% of the consolidated budgets of are made with the help of subventions member states of the Russian Federation. transferred to local budgets from federal or regional budgets. Bodies of local self-gov- In other countries, too, transfers are an ernment are responsible for the use of important part of local budgets. For in- material and financial resources received stance,inBelarustheshareoftransfersinthe by them for the execution of certain state general volume of revenues reaches 58%, powers. depending on the kind of territorial units and the relationships between state local Aggregate data on the local finances of the government and local self-government. In states of Eurasia is provided in Table 3. But Uzbekistan, where law proclaims the prin- such data have to be used with care. Due to ciple of balanced local budgets, grants are the unstable economic situation of many of EURASIA 110 Decentralization and Local Democracy in the World the countries of the region, economic indica- The same functions are transferred to the tors are volatile; important differences in local level in several other states of the terms of GDP, and percentage of GDP may region. For instance, in Ukraine, health occur from one year to the next. Further- services, education and social protection more, changes in proportions may have dif- represent more than 80% of local public ferent meanings, depending on other cha- expenditures. Furthermore, Ukrainian local racteristics of the situation. For example, a authorities manage communal property diminution of the share of local government and local finances, ensure development of expenditure may be due to the centraliza- appropriate territories, provide services to tion of expenditure, or to a sharp increase of the population, ensure participation of the GDP caused, for example, by an increase in population in civic life, and protect public In Russia and most oil prices. order. of the European Functions. The functions of local authori- In the majority of the states of Central part of the ties are not clearly defined by law. Such Asia, such functions are exercised by state region,main local ambiguity is explained primarily by an executive entities integrated in a hierarchi- ongoing process of redistribution of pow- cally centralized system. Accordingly, state government ers among different levels of government. functions are distributed between different functions are Nevertheless, it is possible to distinguish levels of the vertical structure. Regulatory several models of function allocation. functions belong to central administra- education, public tions. The execution of laws is reserved for health, social Main functions. The main functions of lo- local authorities. As an example, in Kaza- cal self-government in Russia and Armenia khstan the role of local government in security, culture, are to: provide participation of the popula- health care and social aid remains signifi- local economy, tion in local matters, ensure effective cant. Kazakhstan local government expen- development of territories, provide public ditures in 2004 were: administrative func- sport and physical services, represent and protect the rights tions 4%, defense 2%, police 4%, training and youth and interests of local self-government, education 31%, health care 20%, social manage municipal property and finances, aid 7%, local economy 12%, transporta- policy. In most of protect public order and organize public tion 6% and 14% for other lesser func- Central Asia, such transportation. tions. In Uzbekistan, regional and city budgets represent 64.4% of all social functions are In Russia, in the course of the reform of spending, including 69.6% of all spending local self-government, the functions of on education and 61.4% of all healthcare exercised by state municipal units were enlarged, thus limit- spending. executive entities ing regulation by subjects of the Federa- tion. The law has reshaped the functions of III.2. Main Trends in Selected Competences integrated in a municipal units, taking into account their hierarchically nature and status. Law has also prescribed Planning. Planning is an important more clearly the economic basis of local endeavor in all the states of the region. In centralized system self-government and specified the respon- Russia, it serves as a basis for federal, sibilities of bodies and officials. Further, regional and municipal programs aimed at the law has introduced new schemes of the development of municipal units. economic inter-municipal cooperation and Instead of the former strictly centralized regulated more precisely the procedures methods of governance that were charac- for transferring certain state functions to teristic of the Soviet period, Armenia and local self-government. Today, the main Russia apply new approaches to planning responsibilities of local self-government that exclude administrative mandates. The are education, public health, social secu- states of Central Asia retain, as a rule, rity, culture, local economy, sport and centralized systems of planning for eco- physical training and youth policy. nomic and social development. EURASIA Decentralization and Local Democracy in the World 111 Education. In the majority of states, prevails in Tajikistan, where providing so- responsibility for public education is divided cial services is handled on three levels: between local state government and local that of the republic, the region and the self-government. The latter, as a rule, is en- locale. Regional and local authorities are titled to deal with pre-school and basic entitled to maintain the institutions that education. Nevertheless, central state provide assistance at home. government establishes general legal norms in this sphere, and local self-governments In Kazakhstan, local state organs pay put these norms into practice. allowances and benefits to the unemployed, large families, orphans and single mothers. In Uzbekistan, education is centralized. For They also subsidize childbirth, housing and pre-school and basic education, central funeral expenses. Ukraine has made a clear state organs approve standards, provide separation of responsibilities in the sphere resources and supervise the execution of of social services. The law "On Social Serv- laws, while other levels are engaged in ices" (2003) establishes two spheres of providing services and deploying resources. state and community services financed by different budgets. In Tajikistan, local self-government is responsible for pre-school and elementary Provision of public health services. school institutions, while cities and districts Nearly all states of the region have divided handle secondary schools and colleges. In the responsibility for public health between Ukraine, there is no strict separation of state (national and provincial) government functions in education, which results in a and local self-government. The exception is confusion of powers between local state Ukraine where powers of local self-govern- government and local self-government. ment are not clearly defined. In Russia and a number of other states, local authorities In Armenia, according to the law "On State are responsible for providing medical first- Non-Commercial Organizations," the state aid, organizing medical aid in the "zone of reserves the role of founder of educational first contact" with patients in hospitals, institutions. At the same time, as provided ambulances and medical posts, and organ- by the law "On Local Self-Government," all izing preventive medical services. facilities of pre-school education were gi- ven to municipalities and became munici- According to laws of Armenia, heads of mu- pal property. nicipalities are responsible for organizing and managing municipal health-care insti- Provision of social services. In the tutions. They promote improvement of san- majority of the states of Eurasia local self- itation and implement sanitary, hygienic, government has fairly broad functions in anti-epidemic and quarantine measures. In the provision of social services. For Kazakhstan, local state authorities adminis- instance, Russian law prescribes that local ter public health. They assist local hospitals self-government is responsible for organiz- and general polyclinics, specialized clinics, ing social protection of the population, pro- tuberculosis hospitals, diagnostic centers and viding social assistance, establishing differ- rural medical posts. They are also responsible ent social services and assisting institutions for the prevention and treatment of danger- that provide social services. ous infections. In Uzbekistan, public health is handled mainly by the state. Local self-gov- In Armenia, social services administration ernment is responsible for organizing and is assigned to the state. But even there, maintaining medical posts. local self-government has been empowered to provide social services through their The majority of states have a multi-level own social programs. The same situation system for financing social services. As a EURASIA 112 Decentralization and Local Democracy in the World rule, local state authorities and local self- Business development support. In governments do not have adequate finan- Azerbaijan, Armenia, Russia and Ukraine, cial resources for maintaining public serv- support to business development may be ices in the fields of education, public health provided at all levels: by central, regional and social aid, though total budgets grow and local state bodies, as well as by local constantly. self-government. Several countries, including Russia, not only affirm the right In Tajikistan, public health and social ser- of local self-government to support busi- vices are not handled by local govern- ness development, they also provide nec- ments. However, local budgets finance essary financial resources. 7% and 8% of expenditure on social aid and education. Another model exists in In the states of Central Asia, support for Uzbekistan: 100% of expenditure on business development comes primarily social insurance is covered by local budg- from central state entities. Nevertheless, ets. Meanwhile, social aid, public health the role of local state authorities is also and education costs are financed as fol- considerable. Local governing bodies are lows: about 20% by the state, approxi- responsible for licensing economic activi- mately 50% by regional budgets, and ties at the local level, granting permission 20% to 30% by district budgets. In 2005, for construction of community nets and Russian Federation local budgets buildings, organizing tenders for the provi- financed 22% of expenditure on public sion of social services, and managing the health, 16% on social policy and 43% on sale of community property. education. A summary table on functions of local Water, energy and public transporta- authorities is presented below (see table 4). tion. In Russia, responsibility for public transportation, and for providing water, III.3. Administrative Capacity energy, gas and heat falls to local self-gov- ernment. Organs of self-government have Efficient execution of powers by local received broad powers and may have authorities is determined not only by ade- appropriate objects in municipal property, quate financing, but also by a well-orga- which permit them to implement these nized professional municipal or state local functions. In Armenia, infrastructures of service. gas, energy and water supplies used for municipal needs may be transferred, Municipal service. The notion of munici- according to the Law "On Local Self-gov- pal service in the nations of Eurasia is ernment," to municipal property. applied to the level of local self-govern- ment. Unlike many other countries, the In Belarus, Ukraine and in the states of Eurasian countries generally do not include Central Asia, the functions of water and employees engaged in the sphere of edu- energy supplies and public transport are cation. Municipal service is regarded as a within the province of local state adminis- professional activity that has to be exer- trations. They are obligated to provide for cised independently of state bodies, the management and maintenance of local regardless of political forces and results of services, and to grant subsidies to users. local elections. Nevertheless, it is necessary to note that local budgets are not always able to pro- In all countries of the region, the executive vide adequately for the management and bodies of city municipalities function on a maintenance of these functions due to more professional level. Rural territorial shabby condition and a shortage of finan- communities have far fewer municipal cial means. employees, and their knowledge of munic- EURASIA Decentralization and Local Democracy in the World 113 Table 4 Functions of Local Government (Intermediate and Local Levels) Country Planning Education Social Public Water Energy Public Supportof services health supply supply transport business Armenia Yes No (with the No (with the exception Yes Yes Yes Yes Yes exception of of voluntary pre-school institutions) implementation of own municipal social programs) Azerbaijan Yes No Yes (in the spheres not Yes Yes. No Yes Yes occupied by the state). Belarus Yes Yes Yes Yes Yes Yes Yes Yes Georgia Yes Yes Yes Yes Yes Yes Yes Yes Kazakhstan Yes Yes (elementary, Yes Yes Yes Yes Yes Yes secondary and professional secondary education) Kyrgyz Republic Yes Yes Yes Yes Yes Yes Yes Yes Moldova Yes Yes Yes Yes Yes Yes Yes Yes Russia Yes Yes Yes Yes Yes Yes Yes Yes Tajikistan Yes Yes (pre-school and No No (though local Yes Yes Yes Yes basic educational budgets finance institutions) public health - 8%) Turkmenistan Yes N/A N/A Yes Yes Yes Yes Yes Ukraine Yes Yes Yes Yes Yes Yes Yes Yes Uzbekistan Yes Yes Yes Yes Yes Yes Yes Yes Source: UCLG Country Profiles (2007). ipal management and marketing is low. are not regarded as bodies of local self- The improvement of the professional level government and, as a result, their em- of municipal employees is still an acute ployees are excluded from municipal problem in the development of local self- service. The legal status of municipal government. employees is established by federal laws, laws of member states of the federation and In Russia, there were in 2006 about charters of municipal entities. The status of 280,000 employees (on average, one municipal employees and the guarantees municipal employee for every 500 citi- of their employment are based in the zens) (see table 5). According to Russian main on general principles, applied to the law, the municipal service is exclusively state public service. Evaluation of the comprised of persons working in local work of municipal employees is exercised self-government. Municipal institutions, on the basis of qualification exams and such as schools and healthcare facilities attestations. For non-execution or undue EURASIA 114 Decentralization and Local Democracy in the World Table 5 Staff of local government Countries Staff Regime(public Status(law Recruitmentprocedure Training or privatelaw,carrier orcontract) especiallyinhigher orjobpositions) positions Armenia N/A Public law; carrier and contract Legal status is defined by Municipal employees are The law provides for professional municipal service the law "On Municipal Service" appointed by heads of organization of training municipalities courses Azerbaijan 25,000 (average Public law; carrier and contract Legal status is regulated by Chairmen of municipalities appoint N/A 1 municipal employee professional municipal service. the law "On Municipal Service" heads of branch departments for 300 citizens) dated November 30, 1999 on the basis of the decisions of municipalities; other municipal employees are appointed directly by heads of municipalities Belarus 22,000 at the Public law; contract Legal status is defined by Municipal employees are Training courses end of 2005 state service the law "On State Public appointed by heads of local Service in the Republic government bodies on the of Belarus" basis of exams Kazakhstan 46,546 Public law; Activity of local bodies is Akims and heads of staff of N/A contract service regulated by legislation of regions, capital and city of Almaty state public service are political, appointed state employees. The majority of employees of representative and executive bodies are carrier employees (according to results of contests and attestations). Kyrgyz Republic N/A Public law; contract Legal status is defined by the Municipal employees are N/A and carrier service law "On Municipal Service" engaged according to results of contests and attestations Moldova N/A Public law; contract Application of the law on Appointment and dismissal N/A the state civil service by the mayor or district head Russia Approximately Public law; Legal status is defined by Heads of municipal units may be Training courses 280,000 (average 1 contract service federal laws, laws of elected directly by population or municipal employee member states of the appointed by representative for 500 residents) Russian Federation and bodies of municipalities. Other by charters employees are appointed by of municipal units heads of municipal units Tajikistan N/A Public law; Legislation regulating Employees of local bodies are N/A contract service state public service appointed by heads of local administrations Turkmenistan N/A Public law; Legislation regulating state Employees of local bodies are N/A contract service public service appointed by heads of local administrations Ukraine 91,925municipalemployees Public law; Legislation regulating state Election and appointment of Staff reserves for as on September 1, 2006 contract service public service municipal employees appointment and promotion of municipal employees Uzbekistan N/A Public law; Legislation regulating state Appointment by higher bodies N/A contract service public service and heads of local gvt bodies Sources: UCLG Country Profiles (2007). EURASIA Decentralization and Local Democracy in the World 115 execution of their duties municipal em- Several states of Eurasia have ratified the ployees may by subjected to disciplinary UN "Convention against Corruption" and the punishments. The new federal framework European "Criminal Law Convention on Co- law number 25 of March 2, 2007, estab- rruption." lishes a new unified legal basis for the municipal public service. It is linked to Management reforms. A number of the state public service, but clearly dif- countries, including Russia and Ukraine, ferentiated from the elected officials; it is have launched administrative reforms to aimed at professionalizing and stabilizing improve the functioning of all chains of the corps of municipal public servants. public management. The emphasis for The new law took effect on June 1, 2007, local self-government is recruiting profes- and has to be developed by laws of the sional administrators with sufficient know- subjects of the Federation. ledge and experience to resolve most local issues. In recent years, the percentage of Presently in Azerbaijan there are about such employees in the system of local self- 25,000 municipal employees: on average, government has visibly increased. These one for every 300 citizens. In Belarus, changes were directly caused by replenish- state employees function on the local ment and intensive education of municipal level. Their numbers comprise approxi- employees. The states of the region also mately 22,000 persons: on average, one adopted measures for the introduction of Mass media for every 450 citizens. modern management technologies. Em- inform the public phasis is placed on the importance of strict Integrity of elected officials and employ- registration procedures and rapid about criminal ees; prevention of corruption. Munici- responses to the requests of citizens. prosecution pal authorities face the same danger of corruption as authorities do at other levels The improvement of the quality of local of municipal of public power. Mass media inform the services is also connected with further employees public about criminal prosecution of privatization of municipal property, in municipal employees for bribes, thefts and particular in the sphere of residential for bribes, thefts other misuses of public functions. community economy. and other misuses Sociological inquiries conducted in one of of public functions the regions (oblasts) of Ukraine show IV. Local Democracy that annually 60% of respondents wit- ness at least one incident of corruption A certain indicator of progress for local (15.69 % reported `numerous,' 28.55% democracy is the increasing competitive- `several' incidents of corruption). ness of local elections at the levels where they are organized, even though this A number of countries have adopted legal occurs only at the lowest level of gover- remedies to aid the struggle with corrup- nance in some countries. Electoral partici- tion. For instance, the government of pation remains low in some countries, but Armenia enacted the decree "On Anti- is comparable to European countries in Corruption Strategy and Program of others. It is useful at this point to précis Implementation." It provides measures the legal status of local government bod- strengthening public control over bodies ies because this factor can have an impact of local self-government, creating trans- on the relationships between elected bod- parent procedures for forming local ies and the local administration. budgets and spending local funds. It emphasizes the necessity of holding local The following table summarizes the basic self-government officials personally liable institutional features of local democracy for misdeeds. in the countries of the region. EURA Table 6 Local Democracy 116 State Formation of local Local executive bodies General features of electoral Number of deputies Term of powers representative bodies systems (minimum and maximum) SIA Armenia Elections of councils of Big administrative territorial units are go- In elections of bodies of local self-government, Depending on the quantity Local self-government municipalities verned by bodies of local state government. candidates are appointed exclusively at their own of population, 5 to 15 bodies are elected for a Decentrali Municipalities (villages, settlements, cities and initiative, but most candidates are affiliated with members of municipal 4-year term. quarter communities of Erevan) are managed different parties providing them appropriate support. councils (5 members for exclusively by organs of local self-government. In the elections of heads and councils of municipalities not Heads of municipalities are elected. municipalities, majority electoral system applies. exceeding 1,000 residents zationan In 2005 elections, bodies of local self-government and 15 members for were formed in 829 out of 930 communities of municipalities totaling dLocal Armenia. more than 20,000 residents) Dem Azerbaijan Elections of members of Heads of executive power of cities and districts Majority electoral system. The number of members of Members of ocracyin municipalities (state local government) are appointed by the In the 2004 elections 2,731 municipal bodies were municipalities is deter- municipalities are President and are responsible to him. elected composed of 21,613 members of mined by law, depending elected for a term of 5 Chairmen of municipalities (local self- municipalities. on the quantity of years government bodies) are elected; they direct On October 6, 2006, by-elections were held with the population of theWorld activities of executive staff of municipalities. aim to fill 1.941 vacancies in 604 municipalities municipalities Belarus Elections of local councils. Chairmen of regional executive committees Majority electoral system. In the elections held on Local council members There are 3 territorial levels are appointed by the President of the January 14, 2007, 1,581 local councils were elected are elected for terms of 4 of local councils: primary, Republic with consent of regional councils comprising 22,639 deputies. Absolute majority of years. basic and regional (by majority of votes of elected deputies). deputies were not affiliated with any party Appointment of chairmen of district (city) executive committees is by chairmen of regional executive committees with consent of appropriate district (city) councils. Chairmen of district (city) committees may be appointed directly by chairmen of regional committees when his candidates have been twice rejected by appropriate district (city) councils State Formation of local Local executive bodies General features of electoral Number of deputies Term of powers representative bodies systems (minimum and maximum) Georgia 1,017 local councils Local councils elect mayors. Local council of the In Georgia at the local elections of 2006, 69 local councils The council of city of Tbilisi is com- Local councils are (sakrebulo) are elected city of Tbilisi elects the mayor from among its were elected in 4 self-governing cities, 60 municipalities, posed of 37 members: 25 members elected for a term of four members for a term of 4 years. 4 communities in zones of conflict and one in the capital are elected in 10 multi-member years. city, Tbilisi. A proportional electoral system was used in majority election districts. Remaining Tbilisi and a mixed electoral system in other 12 seats are distributed constituencies. 1,733 councilors were elected under the proportionally among the parties that new mixed electoral system gained 4 % of the votes in all 10 of Tbilisi's 10 districts Kazakhstan Local self-government Executive bodies of state local government (akims) have Majority electoral system is used for elections of state The number of deputies of local Local representative bodies are provided only at been until now appointed by the President of the upper local representative bodies. Second round of elections is state representative bodies is bodies and akims are the lowest level, but they akim. But they may be elected according to the procedure held when no candidate has received 50% of votes. determined with account of elected for a term of 4 are still not formed. determined by the President. In 2005­2007, elections of Elections of lower akims in administrative units with population of appropriate units in years. Elections to state local akims have been gradually introduced in rural circuits, population less than 5, 000 are held directly, with the procedure as specified by the representative bodies of villages and settlements and as an experiment in several population exceeding 5, 000, indirectly through electors. Law On Local State Government. provinces, districts and districts and city districts of Astana and Almaty Representative bodies of Astana cities of republican and and Alma-Ata are composed of district significance not more than 50 (city, 30, district, 25) deputies. EURA Kyrgyz Rep. Local self-government Executive bodies of local self-government are elected. Proportional electoral system is used for elections of local Hokims of state Decentrali functions only at the lower Hokims (heads of state administrations) of districts are councils. 6,737 members of local councils were elected at administrations of level in small settlements. appointed and removed by the President with consent of the elections of 2004. districts are appointed Bodies of representative appropriate local council, and after consultations with the Majority electoral system is used for elections of heads of for terms of 4 years. zationan and executive power are Prime Minister administrations of administrative circuits. In 2006, elections headed by hokims. were held in 34 circuits with populations not exceeding 9,000 residents. dLocal Moldova Local councils and mayors In the elections held on June 3, 2007, 899 mayors of 11,967 members of local councils were elected in 2007. The number of councilors Councilors and mayors Dem of local communities are municipalities, towns, communes and villages. A proportional electoral system was used for the elections of depends on the size of the are elected for 4-year elected. councilors, and a majority electoral system with a run off population. terms. between the two top-scoring candidates for the elections of ocracyin mayors. Second round of elections of 473 mayors was held SIA on June 17, 2007. theWorld 117 EURA Table 6 Local Democracy (Cont.) 118 State Formation of local Local executive bodies General features of electoral Number of deputies Term of powers representative bodies systems (minimum and maximum) Russia Representative bodies of Heads of municipal units according to their charters Law provides for the use of both majority and Thenumberofmembersofrepresen- The terms of powers of SIA local self-government are are elected by voters or appropriate representative proportional electoral systems. In fact, majority tativebodiesofsettlements,including local self-government formed in units with bodies. electoral system prevails. urbancircuits,isdeterminedbychar- bodies are defined by Decentrali populations exceeding 100 Local administrations are headed by heads of tersofmunicipalunitsandmaynotbe charters of voters. When there are municipal units or by persons employed on a lessthan: municipalities fewer than 100 voters, the contractual basis and with account of the results of 7 forpopulationslessthan1,000; zationan powers of representative contests for filling the aforesaid positions 10 forpopulationsover1,000andless bodies are exercised than10,000; directly by meetings of 15 forpopulationsofmorethan dLocal citizens. 10,000andlessthan30,000; However the rights of a Dem 20forpopulationsmorethan30,000 municipal authority can be andlessthan100,000; exercised only for a unit of 25forpopulationsover100,000and 1,000 inhabitants as a ocracyin lessthan500,000;35forpopulations whole (3,000 in areas of exceeding500,000. higher density). Thenumberofdeputiesofdistrict representativebodiesisdetermined theWorld bychartersofmunicipalunits,and maynotbelessthan15 Thenumberofdeputiesofrepresentati- vebodiesofinner-cityterritoriesthatare offederalsignificancearedefinedby chartersofmunicipalunitsandmaynot belessthan10. Tajikistan Local self-government Heads of local state executive power are appointed Majority electoral system is used. functions only at the lower by the President with consent of appropriate local level in small settlements. councils of people's deputies. They also act as Local state representative chairmen of these councils. bodies (councils of people's deputies) are formed in provinces and districts. TurkmenistanSystem of local self-govern- Local state executive power is exercised by hakims Local councils ment is formed by directly appointed and removed from their posts by, and (Gengeshi) are elected elected local councils (Gen- responsible to, the President. for 5-year terms. geshi) of settlements and Local councils (Gengeshi) elect from their territorial public self-govern- members chairmen (archyns). ment bodies. State Formation of local Local executive bodies General features of electoral Number of deputies Term of powers representative bodies systems (minimum and maximum) Ukraine There are two models of The law provides for the election of heads of Majority electoral system is used for the elections of rural 4 years organization of local self- settlements, villages and towns (heads of and settlement councils and heads of settlements, villages government. The first model territorial gromadas). Local councils form local and towns. In other elections (city, district, Regional at the level of villages, executive bodies upon proposal of heads of councils, Parliament of the Autonomous Republic of settlements and towns settlements, villages and towns. Districts and Crimea) proportional electoral system is applied does not provide for local provinces, Kiev and Sevastopol have local state state administrations. The administrations functioning as agents of the second model in Regions state and excluded from the system of local self- and districts provides for government. Heads of local state administrations the mixed model, including are appointed and removed from their posts by establishment of district the President upon proposal of the Cabinet of and Regional councils as Ministers of Ukraine. organs of local self- government and Regional state administrations as local state organs. Uzbekistan Councils (Kengeshi) of Bodies of representative and executive power in Majority electoral system on multi-party basis is used in the The term of powers of EURA people's deputies are provinces, districts and cities are headed by hokims elections of provincial, district and city councils of people's councils of people's Decentrali representative bodies of of appropriate territorial units deputies deputies and hokims is 5 local state government years. elected at the level of Chairmen (aksakaks) of zationan provinces, districts and councils and members of cities. Local self- councils of local self- government bodies are government are elected dLocal formed at the level of for term of 2 or 5 years. settlements, villages, auls Dem and in makhalya of cities. ocracyin Sources: UCLG Country Profiles (2007). SIA theWorld 119 EURASIA 120 Decentralization and Local Democracy in the World IV.1. Local Government Bodies in public law. They may obtain and dispose of property and enter contractual obliga- All states of Eurasia have diversified mo- tions through their own organs, acting dels of local self-government organization. within the powers as provided by norma- At the lowest (grass root) territorial level tive acts and charters of municipal units. there are no permanent bodies. Local mat- ters are resolved, as a rule, by means of The same powers are exercised by respec- direct democracy. Appropriate organs tive bodies of municipal units of Azerbai- appear at higher levels of local self-gov- jan. Unlike similar bodies in other coun- ernment. tries, such as Kyrgyz Republic, Ukraine and Uzbekistan, those in Azerbaijan do not The organizational structure of higher mu- have the rights of corporate persons. nicipal units in the Russian Federation, Ar- menia, Azerbaijan, Georgia and Moldova is IV.2. Local Political Systems composed of representative bodies, heads of municipal units, local administrations The role of political parties varies consider- and other organs and elected officials of ably according to the level of development local self-government as stipulated by laws and the extent of self-government. In the countries and charters of municipal units. The struc- ture of local administrations is established Role of political parties. Local represen- where many by the representative bodies upon propos- tative bodies exist in all states of Eurasia. elements of local als of heads of local administrations. For instance, in Georgia there are 1,017 local councils (sakrebulo). self-government As a rule, municipal units in the states of exist only at the Eurasia do not have the rights of corporate In Russia there are 252,000 elected mem- persons. Nevertheless, they take part in bers of local representative bodies; most lowest level of civil law relations on an equal basis with other members serve on a voluntary basis. Local governance, the participants both physical and corporate (in councils are composed of not less than particular, in Russia, Belarus, Kazakhstan, seven members for municipal units with participation of Tajikistan). The rights of corporate persons populations above 1,000, and not less political parties is are granted to organs of municipal units than 35 members for municipal units with acting on their behalf. They may obtain and population exceeding 500,000 persons. less significant exercise property and non-property rights and obligations and represent municipal Political parties in the countries in the units in courts. On the whole the status of region participate in local elections in dif- corporate persons is held by local repre- ferent ways and to different degrees. In sentative bodies and local administrations. the countries with developed forms of local In a number of municipal units (for instance, self-government, including Azerbaijan, in Vologod oblast of the Russian Federa- Armenia, Georgia, Kyrgyz Republic, Russia tion) this status is also granted to certain and Ukraine, major political parties take executive bodies or structural divisions of part in all elections. In most of these coun- local administrations. Organs of local self- tries, the creation of independent local government as corporate persons are sub- parties is prohibited by law. ject to obligatory state registration in the form of institutions. The main function of political parties is to support their own candidates (Belarus, Another model exists in Azerbaijan and Russia, Ukraine), or candidates who have Moldova. According to the Law of the proposed themselves (Armenia). For in- Republic of Moldova "On Local Public stance, in Russia 9% to 17% of candidates Administration," administrative-territorial in municipal elections are put forward by units have the rights of corporate persons political parties. EURASIA Decentralization and Local Democracy in the World 121 On the whole, local elections in these petitive examination. In the municipal countries take place in a highly competi- elections of 2005, more than 30% of the tive atmosphere. Thus, in Azerbaijan candi- heads of municipal entities were directly dates of 26 political parties took part in the elected. municipal elections of 1999. In Georgia, 21 political parties and blocks took part in the In Azerbaijan, each municipality has its elections of the Tbilisi municipal govern- own executive branch and executive staff, ment held in 2002. In local elections in including the chairman of the municipality, 2006, seven political parties participated; heads of agencies and departments, spe- two of them presented joint lists of candi- cialists and other employees. dates. In Moldova, 22 political parties took part in the local elections of 2007. Representation of women is increasing in local governments in Russia, Belarus, In many municipalities in Russia, Armenia, Moldova, Ukraine and some other states. Azerbaijan and Georgia, more than ten In the Russian Federation, women com- candidates compete for each vacant posi- prise about 30% of municipal leaders and tion. 47% of local council members. In the local elections of 2007 in Belarus, women took In the countries where many elements of 45.7% of the posts in representative bod- local self-government exist only at the ies. In Ukraine, 40.2% of local council Representation lowest level of governance (Uzbekistan, members are women. In Georgia's 2006 Kyrgyz Republic and Tajikistan), the partic- elections, women managed to take only of women ipation of political parties is less signifi- 11.4% of local council seats, and in Kyrgyz cant, though such participation is provided Republic after the elections of 2004, repre- is increasing in for by law. As a rule, elections for local go- sentation of women in local councils was local governments vernment offices are non-partisan. Uzbek- only 19.1%. istan is an exception: five political parties in Russia, Belarus, recently participated in the elections of IV.3. Electoral Systems Moldova, Ukraine local representatives. Legislation in Kyrgyz Republic stipulates that candidates for Election by majority vote is the rule for and some other elected municipal posts may be proposed most local governments. In Ukraine, a pro- states by voters at their place of work, service or portional electoral system has been used residence or education; by groups of vo- broadly since 2004. In particular, this sys- ters at conferences of political parties; or tem is used for the election of deputies of by the candidates themselves. city councils. At times it has caused exces- sive politicization of local government and In the states providing for separation of inappropriate transfers to the local level of representative and executive branches debates on regional, linguistic and foreign (Armenia, Kyrgyz Republic, Moldova, policy. It has also increased the number of Uzbekistan and Ukraine in district cities), inter-party clashes in some regions. candidates to the executive are directly elected by the population. In Russia the law permits the use of both proportional and majority electoral sys- In Russia there are two procedures for tems for local elections. The system of electing local-level executive officials. choice is established by the charter of a Under the first procedure, the heads of the municipal entity; most use the voter- executive branch, who are also the heads majority system. of municipal administration, are chosen by direct popular election. Under the other In Georgia's local elections of 2002 and procedure, they are appointed by council 2006, a proportional electoral system was through a contract on the basis of a com- applied in Tbilisi. In other regions of that EURASIA 122 Decentralization and Local Democracy in the World country, a majority electoral system was In Russia, law establishes such procedures used in 2002, and a mixed electoral system as local referendum, recall of local elected in 2006. officials, voting on changes of the bound- aries of municipal entities and on their In Uzbekistan and Tajikistan, the majority reform, rulemaking initiatives, public hear- electoral system is used for local elections. ings, meetings and conferences of citi- zens, and other civic activities. In IV.4. Citizen Participation 2004­2005, some 400 local referendums were held in 22 of the 89 subjects ­dis- Citizens demonstrate different attitudes tricts­ that comprise the Russian Federa- toward local political life. As a rule, they still tion; most of the referendums concerned prefer to turn to the central state for reso- the establishment or structure of local go- lution of their problems, although this is vernments. changing. In communities where local go- vernments have sufficient resources, can Belarus' Constitution and Electoral Code Local referendums decide local issues efficiently, and defend provides for local referendums and recalls of the interests of the local population, the deputies of local soviets (councils) of are only practised authority and status of local government is deputies. However, there were no local ref- in Russia on the high, sometimes rivaling state authorities. erendums, and recalls of deputies were rare. For instance, in Russia mayors of several At the same time, local meetings are broadly establishment or cities are more popular than governors of used in accordance with the Law of 2000. structure of local the subjects of the Federation. In countries such as Armenia, Georgia and Moldova, In Ukraine, the law provides for elections, governments, where local resources are limited, the pop- referendums, general meetings at the place although they are ulation typically regards local government of residence, local initiatives, public hear- as simply the lowest level of state power. ings, and recall of deputies and local elected provided for all officials. Forms most often used in practice legislations. Forms Overall, throughout the Eurasian region, include general meetings at the place of voter participation in local elections is lower residence, local initiatives and public hear- of citizen than the turnout for national elections. ings on different issues, including taxation. participation at the Referendums are held only rarely. In Russia, voter participation in elections sub-municipal level for rural representative bodies and execu- Legislation of the countries of Central Asia tive leaders was 56.43% and 54.81% does provide for elections and referen- are still most respectively. In municipal districts, voter dums. But in the main, only state-wide ref- popular turnout for comparable elections was erendums are held. In Uzbekistan, local 50.46% for the representative body and government takes the form of assemblies again 54.81% for executive posts. of citizens convened in settlements, vil- lages, kishlaks, auls and makhalyas. Man- According to official data for the 2004 elec- aging bodies of local government struc- tions in Azerbaijan, 46% of registered vot- tures are elected by, and are responsible to ers took part in municipal elections voters residing in the respective territories. there. In Belarus, local elections in 2003 saw 73% voter participation, and in Geor- The Constitution of Armenia establishes gia the turnout for elections in 2005 was two main forms of direct democracy: elec- more than 40%. tions and referendums. No referendum has yet been held. In all countries of the region, legislation pro- vides for different forms of direct democracy. In several countries, there are forms of In practice, these forms are employed with democratic participation below the munici- different levels of energy and consistency. pal level, including groups representing a EURASIA Decentralization and Local Democracy in the World 123 neighborhood, part of a residential area or in others. For instance, in Faustov (popula- a common interest. tion: 50,000) about 200 self-organized committees were created, yet in Kiev In Russia, this sub-municipal level may (population: 2,660,000) there are only 80. include groups speaking for an apartment building, part of an apartment building, a Typically, citizens receive information about residential unit or a rural settlement. Pub- the activities of local committees and gov- lic sentiments may be expressed in meet- ernments through traditional forms, such ings and conferences of citizens, as well as as mass media, posted announcements by means of local elections. This civic sub- and word of mouth. But increasingly, elec- level is responsible for such issues as tronic means of civic participation are being maintenance of residential buildings and developed, especially in Russia and adjacent territories and the resolution of Ukraine. Electronic communication net- local problems. works of local governments disseminate Typically, citizens information to the public, albeit mostly offi- receive information Azerbaijan enacted in 2001 the law "On cial information and announcements. Infor- the Model Rules of Block Committees of mation pertaining to citizen participation in about the activities Municipalities," which serves as a basis for local governmental affairs is still something of local committees establishing new organizations to assist of a rarity. municipalities with governance at the sub- and governments municipal level of apartment buildings and IV.5. Central-Local Relationships through traditional city blocks. Block committees composed of from five to 11 people are elected at civic In all countries of the region, there is a sys- forms,suchas meetings. tem of state supervision over local agencies mass media, posted of state government as well as local self- In Belarus, territorial government func- governments. Such central supervision is announcements tions not only at the level of residential exercised through executive powers, prose- and word of mouth. units ­ apartment complexes and city cution offices and courts. In several coun- blocks ­ but also in settlements as well. In tries, these controlling agencies cooperate But increasingly, all, Belarus counts 43,758 such micro- with each other; in other countries they electronic means units of governance. function without noticeable coordination. of civic In Uzbekistan, there are more than 10,000 The President and the government of Rus- local communities (makhalyas). Members sia and heads of subjects of the Federation participation are of these communities are united by place may consider citizen grievances concern- being developed, of residence, traditions and customs, ing the actions or inaction of municipal forms of communication, legal, economic employees and officials. Federal ministries especially in Russia and family relations. For centuries they may also assist citizens seeking redress of and Ukraine served as a means for elaborating and reg- grievances. ulating principles and rules of community life, for shaping ideological and philosoph- In Azerbaijan, supervision of local self-gov- ical views, forming morals, honoring tradi- ernment is exercised by the Ministry of Jus- tions and expressing public opinion. tice. This ministry is not only responsible for ensuring that local governments act in a In Ukraine, citizens may on their own ini- lawful manner, but also for controlling tiative create committees to represent expenditure of public means and supervis- apartment buildings, the residents on one ing observance of human rights. The Min- street, block committees and other groups istry of Justice provides an annual report on with the consent of appropriate local coun- these issues. In 2005, some 240 local gov- cils. Such self-organizing groups are more ernment actions were revoked and 70 acts popular in some parts of the country than of municipalities were amended. EURASIA 124 Decentralization and Local Democracy in the World In the Russian Federation, the Ministry In the countries of Central Asia, the Russ- of Justice does not have such functions. ian Federation and Armenia appointed Supervision of local self-government is employees of local governing bodies may exercised by prosecution units (proku- be dismissed by the higher officials who ratura). appointed them. Grounds for dismissal of municipal employees in Russia and Arme- In Ukraine, control over local self-govern- nia often include: court decisions pro- ment is exercised by committees of the hibiting the occupation of a particular Parliament and by local offices of state position in municipal government bodies, administrations, and the prosecution office expiration of contracts or reaching a (prokuratura). Financial control is exer- specified age limit. cised by agencies such as the Accounting Chamber, State Control and Revision Serv- In the majority of the countries of Central ice, or Fund of State Property. Asia, there are systems of central-govern- ment executive branches that ensure the In all countries of Financial control, as a rule, is held by min- conduct of uniform state policy in appro- istries of finance in Armenia, Belarus, Rus- priate spheres of activities. These central- the region, there is sia and Ukraine, and by the Ministries of government authorities cooperate with a system of state Internal Revenue in Belarus. Branch over- local governments on matters pertaining sight is carried out by appropriate depart- to execution of the functions of a local gov- supervision over ments of ministries and state agencies. ernment, adopt within their competence local agencies of Prosecution units (prokuratura) in all coun- normative legal acts and give instructions tries exercise control over strict and uni- and recommendations on due exercise of state government form execution of laws. powers on the local level. Ministries may as well as local exercise functions of coordination and con- There are also forms of popular control trol, with the exception of local organs of self-governments. over local self-government. In Russia, internal affairs (police), which have dual Such central charters of municipal entities may provide subordination, similar to the former soviet for recall of local elected officials. system of government. supervision is exercised through In Armenia, Russia and Ukraine, acts of In Armenia, Belarus, Russia and Ukraine, local self-government entities may be the impact of branch offices of executive executive powers, quashed by courts or by the entity that power (central and regional) on the activi- issued the acts. ties of local government and local self-gov- prosecution offices ernment is demonstrated in the control and courts In other Eurasian countries, local acts may over the execution of delegated state func- be revoked or suspended by the head of tions. In the event of violations, appropri- the state (Belarus), the supreme legisla- ate state officials may give in written form tive body (Council of the Republic in mandatory instructions for eliminating vio- Belarus, Parliament in Uzbekistan), or by lations. In Russia, such instructions may offices of state power, which is the way in be appealed in the courts. the countries of Central Asia. In all countries of Eurasia, bodies of local The functions of bodies of local self-go- self-government may sue a state authority vernment may be terminated ahead of or state officials for actions or decisions time on their own initiative (self-dissolu- infringing local rights. Citizens also have tion), by court decision (Armenia, Russia), the right to file a suit if they believe gov- or by decision of the Parliament (Kaza- ernment at any level has violated their khstan, Kyrgyz Republic). In Azerbaijan, right to self-government. In several coun- the dissolution of local self-government tries, conflicts between local self-govern- bodies is not provided for in law. ment bodies and private (individual and EURASIA Decentralization and Local Democracy in the World 125 corporate) persons may be resolved only Republic, local self-government is re- in the courts, unless by mutual consent presented by the Association of Cities and the dispute is relegated for resolution to Association of Local Self-government of Vil- some other body or procedure. In a num- lages and Settlements. In Ukraine, there is ber of countries as well, acts, local self- a Congress of Local and Regional Govern- government bodies and officials can also ments. In Armenia, there are about 20 be revoked by courts, as is the case in municipal associations and unions. Azerbai- Armenia, Kazakhstan and Russia. Accord- jan establishes regional associations of ing to legislation in Ukraine, implementa- municipalities on the basis of the Law of tion of local self-government actions may May 3, 2005: "On Model Charter of Regional be suspended as provided by law with a Associations of Municipalities." Several simultaneous filing of a judicial suit. Dis- countries have associations of different putes concerning local self-government in groups of municipal units, such as rural and Ukraine are heard by administrative courts. urban units. Many countries, including In several At present, only the Supreme Administra- Kazakhstan and Russia, also have associa- tive Court has been established. The func- tions of different divisions or departments countries, tions of local administrative courts are still of local self-government. including Russia performed by courts of general jurisdic- tion. In several countries, including Russia Associations and unions of municipal units and Ukraine, and Ukraine, matters of local self-govern- pursue the following goals: establishing matters of local ment are heard in economic courts ("arbi- and developing local self-government as a tration courts"). These primarily consider political institution and a basis for civil soci- self-government disputes between local self-government ety, creating favorable conditions for com- bodies and citizens or corporate entities. plex social and economic development of are heard in municipal entities, coordinating coopera- economic courts IV.6. National Associations of Local tion of municipal entities and their associa- Self-Government tions with state authorities in the interests ("arbitration of local self-government and the develop- courts"). These In the countries of Eurasia with more ment of inter-municipal cooperation. developed forms of local self-government, primarily consider there are national institutions representing Associations of councilors of representative disputes between interests of local self-government. In the bodies of local self-government are directed countries of Central Asia there are as yet to increase the authority of the representa- localself- only plans to establish such institutions. tive branches of local self-government, government bodies develop civic activity in the population, take In a majority of countries, there are unions part in campaigns before elections, and dis- andcitizensor of municipal units. For example, the Russ- cuss with the central government draft laws corporate entities ian Federation has the Congress of Munici- on matters of local state government and pal Units established by 46 associations and local self-government, as well as any policy unions of municipal units, the Union of issue regarding local government. Their Russian Cities, and the Union of Small Cities opinion is usually requested formally on the of Russia, to name but a few. In Kyrgyz drafting of laws. EURASIA 126 Decentralization and Local Democracy in the World V. Conclusion The countries of Eurasia have achieved dif- economic conditions. The general process ferent stages in the development of local of decentralization and reinforcement of self-government. But despite all differences, local self-government is also hindered they share several general tendencies and by the chronic shortage of resources, features. including those needed to exercise real power by local governments. In Kaza- First, the legal framework of local self-gov- khstan and some other states, local self- ernment has been established in all the government is only proclaimed by the countries in this region. The constitutions of Constitution. In practice, it is rare; in all states contain articles, sections and some states citizens are still wary of local norms devoted to local self-government power structures. It is possible to speak and guarantees of its realization. The con- only of the gradual rapprochement of stitutions proclaim that the rights of citizens local communities and public institutions. to have local self-government may not be In this regard, in all countries of the restricted. The constitutions of all countries region a special role must be attributed to except Kazakhstan, enshrine important po- elections of representative bodies, pro- wers of local authorities. Transfer of such vided their democratic fundamentals are powers to other persons or governing bodies constantly strengthened. is not permitted. In all of these countries, the development Beyond this fundamental and ubiquitous of local self-government is undermined by acceptance of the importance of local self- a weak financial base. To remedy this it is governance, broad themes of a common necessary to reinforce local taxes, develop heritage give rise to a similarity in the inter-budgetary relations and provide fair and problems that are being addressed objective procedures for raising and allo- throughout the region. cating local revenues and expenditures. In all of these countries, there is an in- The development and strengthening of creasing aspiration among local commu- local self-government as a rule takes place nities to decide social issues locally and within the framework of the larger, general independently through their own repre- administrative reform aiming to separate sentative bodies. This movement is, how- and distinguish clearly the powers of all ever, constrained by long-standing tradi- levels of government, as well as workable tions; in some countries decentralization principles of subsidiarity. Progress, how- is prevented by unstable political and ever, is slow and some reforms are quite EURASIA Decentralization and Local Democracy in the World 127 fragile, in part due to complicated eco- standards of the Council of Europe, espe- nomic conditions in several countries and cially those that are members of the Com- frequent political changes. monwealth of Independent States and the Eurasian Economic Community. Such shared All Eurasian countries are strongly influ- influences permit the prediction of a high enced in matters of local self-government degree of accord in future legal regulation and general democratic principles by the of local self-government. EUROPE GÉRARD MARCOU HELLMUT WOLLMAN EUROPE 130 Decentralization and Local Democracy in the World EUROPE Decentralization and Local Democracy in the World 131 I. Introduction trend toward regionalization, and prob- lems related to organizing urban areas. The Europe under study in this chapter co- vers more than the European Union (EU) The reforms of the 1960s and 1970s set and less than Europe the geographical en- the scene for two contrasting approaches tity because the area discussed here ends to local government: the council as at the eastern border of the European provider of public services (epitomized by Union. Thestatesthatmakeupthisregion(35) the United Kingdom), and the council as are more diverse than ever, yet they share public body based on a community of local two intrinsic characteristics that distinguish people (epitomized by France). The coun- them from all other geo-political regions: 1) tries that followed the second approach did Every part of their territories is adminis- not undergo territorial reforms at the time, Everypartoftheir tered by a municipal government; 2) All of but since the late 1990s these reforms are territories is these states recognize a discrete set of fun- back on the agenda because of the now damental principles on which local democ- inescapable need to rationalize local go- administered by a racy is based. These principles, drawn up vernment structures. Such reforms always municipal and implemented with the participation of aim at getting first-tier local governments1 local authorities and their organizations, to take on greater responsibilities, directly government and all were enshrined in the 1985 European Char- or indirectly, by giving them adequate ca- ter of Local Self-Government, which has pacity to do so. What has sometimes wor- of these states since been ratified by several states outside ked against this approach, however, has recognize the region defined here. Moreover, local been an avowed policy of bringing local self-government has been recognized as a government closer to local people; after a discrete set governing principle by the EU. regime changes in Eastern Europe, this of fundamental localizing trend led to the break-up of However, behind this broad agreement on many councils in the Czech Republic, Hun- principles on which basic principles lies a striking variety of gary, Slovak Republic, and the states that local democracy is institutions and practices, and quite dis- once comprised Yugoslavia, Serbia and tinctive national exigencies. The traditional Montenegro excepted for the moment. based diversity typical of the western states has now been increased by the central and The other important development in terms eastern new member states of the Euro- of territorial organization has been region- pean Union, in which the principle of local alization. Contrary to many assumptions, self-government has only been translated regionalization is much more a functional since the 1990s into institution-building. issue than an institutional one. Far more Also joining in the process are other states than a question of the number and charac- in South-eastern Europe, where reforms ter of institutions, regionalization concerns are even more recent and fragile. Despite territorial policies adopted in response to all this diversity, a number of major trends problems that are neither strictly local nor in common can be identified. national. Regionalization manifests itself very differently depending on the constitu- The first such trend concerns territorial or- tional framework of each state, and on how ganization. The European countries seem it cuts across issues peculiar to that coun- to be entering a new phase of territorial try. While it concerns urban organization in 1. The "first-tier" or reform that is significantly different from the Netherlands or institutional regionalism premier degré is those of the 1960s and 1970s. Not all in Spain, regionalization takes many other that of basic states are similarly affected by this devel- forms as well. Sometimes it is a layer community-level opment; some in fact remain outside of it. added to traditional intermediary authori- local government, In essence, the new territorial reforms are ties, without undermining them, as is the however they are concerned with strengthening the munici- case with the French département. These defined within the pal and inter-municipal frameworks, the examples also serve to draw attention to national context. EUROPE 132 Decentralization and Local Democracy in the World the potential impact of regionalization at some resistance. The Charter's legal situa- the municipal level. tion remains uncertain in Italy, Portugal, Spain and the United Kingdom, and there is The organization of large urban areas, in- an increasing tendency among local cluding their capital cities, is a key issue authorities to turn to the private sector to for all the European countries. Nor is this a deliver public services; privatization has particularly new issue. It has, however, co- been less significant in countries with a me back under the spotlight in the past 10 long record of such outsourcing, including years. The problem remains one of how to Belgium, France, Greece, Italy and Spain. structure and connect the different levels Some countries have developed a system of urban organization while allowing for of delegated powers and responsibilities, in functional needs as well as the demands of particular Austria, the Czech Republic, Ger- democracy. Responses have varied, such many, Hungary, Italy and Slovenia. This as between adapting common law and practice allows local councils to execute applying specific regulations, between in- administrative tasks under state responsi- For all the European tegration within a metropolitan authority bility. Among the sector-specific develop- and focusing on the city as a centre. ments, it is evident that local authorities countries the are becoming increasingly involved in edu- organization of The second major identifiable trend con- cation as well as in public safety, though cerns the management of local authorities, here central control is being reinforced in large urban areas, and their powers and responsibilities. countries where the local councils and and capital cities, Summarized, the powers and responsibili- mayors already exercised broad powers. ties devolved to local authorities are is a key issue increasing, though states are tending to Progress in public-sector management is strengthen their control over local finance. evident throughout the European region, Combined with this general trend are a even in the newly democratized and variety of issues specific to each state. The decentralized countries that have bene- powers and responsibilities of local author- fited from various programs developed by ities have suffered from the establishment international organizations, and through of regional autonomies2, although some bilateral cooperation projects. The pre- remedies have been put forward (e.g. the cepts of the "new public management" 2001 constitutional amendments in Italy have been differently received among and their implementation) or are being European countries, depending on individ- debated (e.g. the "local autonomy pacts" ual public service traditions, but the in Spain).The powers and responsibilities increase in responsibilities and the accom- of local authorities have suffered from the panying rationing of resources intensified establishment of regional forms of self- pressure on local authorities to find ways 2. We distinguish government. Some measures to remedy to rationalize their management in order to between regional this, such as the 2001 constitutional re- give themselves maneuvering room. "Per- self-government view in Italy, have already been taken; formance culture" has advanced and and regional others are being debated, including spread, as has its peculiar lexicon: defining autonomy: the Spain's "local self-government pacts." objectives, indicators for evaluating results latter is a much and benchmarking tools. stronger form, With regard to powers and responsibilities closer to federalism in a strictly technical sense, local authori- Another major development affecting Euro- than to classical ties have been affected by sector-specific pean local authorities concerns the dynam- local self- developments as well as more general ics of institutions and local democracy. Along government, and affecting the ones. Under the latter category, it should with the steady progress made by local constitutional be noted how the general competence democracy, local government is further dif- structure of the clause on their powers and responsibilities ferentiating, regarding the relationship state. has found widespread application despite between an assembly and the executive EUROPE Decentralization and Local Democracy in the World 133 body, between the design of the executive, 1993; Norton: 1993). Even so, in the fol- the forms of election in use (e.g. increasing lowing countries certain councils can take practice of direct election of mayors) and the on the powers and responsibilities of both place given to citizen participation. Despite government levels: the wide variety of processes and reforms involved, a common tendency can be identi- · Germany: municipality and district fied: that of seeking to establish a political (Kreis), with larger urban leadership that is clearly accountable to its municipalities having the status of a citizens. Promoting local executive power, as district and district-level concomitant distinct from the assembly, is widely powers and responsibilities. A similar regarded as a necessary means for system is now used in Hungary and strengthening political leadership and Poland; accountability, even where there is no direct election of a mayor, which is the case in the · England: district and county. Before the United Kingdom and the Netherlands. 1972 reforms, certain boroughs had the attributes of a county. Since the re- A presentation of the condition of local de- forms of 1986 and 1996, some areas mocracy in Europe, however generalized, have only a single-tier local authority must account for both common tendencies ­the district in metropolitan areas, the and the diversity of institutions and prac- unitary council in others; tices. The split between shared and distinct elements underlies territorial organization, · Belgium, France, Italy and Spain: the powers and responsibilities, management municipality and province, or départe- and finance and local democracy. ment. This applied in Belgium, Italy and Spain before regions with constitutional II. Territorial Organization status were set up3. The municipal level has to be distinguished This standard depiction more or less left from the intermediate levels, but we will out countries like Finland, Greece and focus here on the municipal level, includ- Portugal, which traditionally had just one 3. In Italy, the regions ing inter-municipal institutions. Any com- level of decentralization. Nor do these with ordinary status were not set up until parative presentation of the territorial standard criteria take into account differ- 1970, although they structures of the European states must ences in size that can affect meaning at a were provided for take into account all the reforms that have higher level4. The traditional presentation under the 1947 been carried out over the past thirty years, also failed to account for administrative Constitution. as well as their many structural offspring. divisions existing exclusively to meet the 4. For example, the Such a presentation presupposes defining needs of the central government, and difference between the different levels of territorial organiza- excluded federal entities like those in the German Kreis, tion. Austria and Germany. Such shortcomings considered to be aside, the traditional form of presentation both a single local II.1. Definition of Jurisdictions did offer a certain conceptual unity for the authority and a and Government Levels concept of local government based on consortia of one or two levels. municipalities, and the British county, Traditional presentations are based on the covering a much idea that the local authorities within a These days, the picture is far more com- larger state are usually organized into two levels plicated. For one thing, regions have been administrative ­a local council and a higher level covering created in several countries but according division ­ the usual a more or less vast constituency. Powers to very different concepts that, moreover, translation of Kreis and responsibilities are usually divided have changed over time. Belgium became with county blurred between these two levels according to a federal state; in Italy and Spain, the this significant functional criteria. (Marcou / Verebelyi: development of regional autonomies put difference. EUROPE 134 Decentralization and Local Democracy in the World an end to the unitary state. The United bers as a major expression of their Kingdom has moved to an asymmetrical political autonomy; organization with regional autonomies for Scotland, and Northern Ireland, a unitary 2) the constitution sets out and guaran- regime for England and to a lesser extent tees the division of powers and respon- for Wales. (Wales has no proper legisla- sibilities between the competence of tive power after the Wales Act 2006). the central authority and the compe- Meanwhile, in France the region is a third- tence of the constituent members. tier local authority ­a model that Poland has followed. Furthermore, those coun- By convention, two of the table's cells tries that did not undergo territorial show those states that have an asymmet- reforms developed institutions for inter- ric structure; that is, regional autonomy National capitals municipal cooperation to take on the in only part of the territory, or local coun- tasks that small local councils could not cils not included in second-tier adminis- sometimes have a manage. This has resulted in further dif- trative divisions, or disappearance of the ferentiation of the municipal level (the province when the region merges with its particular status first tier). At the same time the new insti- administrative area. Inter- or supra- positioning them in tutions have become closer to the second municipal structures (including those of tier, and have begun to compete with tra- highly integrated inter-municipalities, a direct relationship ditional local authorities at that level. such as in France or Hungary) will be with their country's Analyzing authorities in terms of two-tier treated as being part of the municipal local government is thus no longer level, as will infra-municipal bodies (e.g., central authority enough to give a proper account of the the freguesias in Portugal or the "town current reality. Asymmetric patterns are councils" in Bulgaria). more frequent and the number and the nature of local governments may vary Note that territorial reform is once again from one part of the country to another on the agenda, though this time based one. This new complexity means that we more on functional criteria5. Also, there is have to consider on the one hand, the dif- a general trend toward strengthening ferent government levels of the territorial politically local governments at the basic organization of the state as a whole and level of the community as well as the guar- on the other the differences in the status antees for their self-governance; the inter- of the institutions that we find at each of mediate levels typically show a tendency these levels. to regionalization, although only a minor- ity of states is establishing strong political In an effort to present territorial struc- regions. Setting up such regions can have tures in simplified form while still account- undermining effects on municipalities. ing for the new complexity, the table below classifies states by the number of National capitals sometimes have a par- levels of territorial organization for which ticular status positioning them in a direct local governments have been established, relationship with their country's central and also according to whether they are authority (i.e., Berlin, Bucharest, unitary or composite states. Here the Budapest, Paris, Prague and Vienna). term composite states follows the defini- 5. E.g., with the tion provided by the Spanish Constitu- II.2. Basic Community-Level Local purpose to fulfil tional Court: federal states and states Government (The Local Council) specific functions. with regional self-government, which 6. This means that it aims at answering share the following features: In all countries, it is at the level of the local demands related to council that the issue of trying to balance the implementation 1) a plurality of legislative authority at political space with functional6 space of competences. the center, with the constituent mem- becomes particularly critical, especially in EUROPE Decentralization and Local Democracy in the World 135 Table 1 Levels of Local Governments by Country Levels Unitary states Composite states 3 levels: local council; département/ France, Poland Belgium, Germany, Italy, Spain province/county/district; region or federal body 2 levels: - 1) local council; province / département / 1) Croatia, Greece, Hungary, Ireland, Latvia, Netherlands, 1) none county/district Norway, Poland (cities with district status), Romania - 2) local council, region or federal body 2) Albania, Czech Republic, Denmark (at 01/01/2007), 2) Austria, Belgium (Brussels-capital), Bosnia- France (Paris), Serbia (Vojvodine), Slovak Republic, Herzegovina, German Federation (kreisfreie Sweden, United Kingdom (England, Wales) Städte), Portugal (island regions), Spain (certain uni-provincial autonomous communities), Switzerland, United Kingdom (Scotland) 1 level: local councils and consortia of local councils 1) Bulgaria, Cyprus, Estonia, Finland, Iceland, Lithuania, Germany (city States: Berlin, Bremen, Hamburg); Luxembourg, FYR Macedonia, Malta, Montenegro, Austria (Vienna) Portugal (continental), Republika Srpska, Serbia, Slovenia, United Kingdom (England: unitary councils and metropolitan districts) 2) certain capitals: Bucharest, Budapest, Prague, Zagreb the urban areas (Bennett:1989; Kersting / distinct status for cities (Central and Vetter: 2003; Baldersheim / Illner / Woll- Eastern Europe, starting from Germany mann: 2003). and the United Kingdom). Here it is useful to divide countries accord- The growing pressures of increased ur- ing to two criteria of the territorial pattern banization explain this last distinction in of municipalities: the case of England long before the re- forms of the 1970s; in the other coun- · Countries with a highly fragmented mu- tries, it is a consequence of social struc- nicipal pattern (Austria, the Czech Re- tures that for a long time made it public, France, Hungary, Italy, Spain difficult to expand municipal self-govern- and Switzerland) compared with coun- ment in the countryside. tries that have undergone municipal reorganization aimed at the establish- Today, territorial reform is back on the ment of larger units (Belgium, Eastern agenda in many countries, but from a dif- European countries from the 1950s to ferent perspective. The reforms of the the 1970s, Germany, Greece, Lithuania 1950s, 1960s and 1970s were aimed at today, Nordic countries and the United establishing minimal or optimal sizes to Kingdom); match the powers and responsibilities to be exercised. The reforms of recent years have · Countries with a uniform status of mu- instead been driven more by functional con- nicipalities (Western and Northern cerns, and can therefore take more forms Europe, except the United Kingdom), than the simple merging of municipalities; compared with countries operating a they also cover more of the civic and dem- EUROPE 136 Decentralization and Local Democracy in the World Territorial Reform and Functional Reform The great territorial reforms of the past did meet objectives of functional reform7. In Greece for example, the municipal reform of 1912 allowed for any built-up area with a population of more than 300 and a primary school to constitute itself as a municipality. In Sweden, the territorial reforms of 1952 and 1970 were devised mainly in order to help implement state education reforms at the munic- ipal level. In Germany, the municipal reforms of 1965-1975 were based on the theory of central places, whereby a whole range of services and material resources would be provided from these for a given population. These reforms also aimed at giving municipalities a territorial basis for their powers and respon- sibilities to be expanded later through further functional reforms (Germany, Swe- den). This has been the case over the last few years in Germany where the gov- ernments of certain Länder have transferred new responsibilities to the districts and cities with district status: Baden-Württemberg has undergone the most rad- ical reform, as most tasks of the field services8 of the Land government have been transferred to it. The Greek reforms of 1997 illustrate the dramatic shift that took place. This was a radical reform, decreasing the numbers of municipalities (demes and rural coun- cils) from nearly 6,000 to 1,033. But the real innovative aspect of the reform was that it was not just an amalgamation plan; it involved also a development and investment program, and the territorial reform was a necessary step to imple- ment that program. The aim was to set up local authorities able to implement it, which meant equipping them with the necessary institutions, staff and financial resources. A five-year program (1997-2001) financed by the state was thus the support framework within which the new municipalities would operate and which 7. Functional reforms: would help finance a capital investment program. The five-year program was also reforms concerning aimed at facilitating the recruitment of managers for the new municipalities and the attribution of to give them the necessary human resources for exercising a greater administra- certain powers and tive and financial autonomy. Another innovative aspect of the reform was to keep responsibilities and a representation of the old local councils in the new local authorities, and secure having the aim of their participation in the debates of the new municipal council, which doubtless improving the ways in which these are helped to get the mergers accepted by the local communities. exercised. 8. Field services are In the new German Länder on the other hand, the transfer of the territorial reform administrative realized in the west proved at first to be a half-failure. Regrouping smaller munic- services with ipalities was seen as working against the aim of restoring democracy, and inter- competence for a municipal bodies (the Verwaltungsgemeinschaft) were set up in order to try and territorial jurisdiction that are resolve this problem. However, the territorial reforms were successfully com- subordinated to pleted at the level of the districts. More recently, territorial reform has taken a central government new turn: the Brandenburg Land has removed many small municipalities by departments. In means of mergers, reducing at the same time the number of inter-municipal bod- some countries they ies, and the Mecklemburg-Vorpommern Land has carried out a radical reform of are referred to as districts, bringing their average population to 350,000. "peripheral administrations". EUROPE Decentralization and Local Democracy in the World 137 ocratic dimension of the municipal organi- regional development and planning, as Highly urbanized zation, rather than being concerned with well as some social services. countries that just technical and management issues. Integrated forms of inter-municipal coop- But in many other countries where munic- underwentmajor eration have then appeared as an alter- ipal functions are certainly less extensive, amalgamation native to amalgamation. it is mainly by developing a second level of municipal government that a solution has ofmunicipalities In the other countries of Central and been sought for difficulties municipalities are now seeking to Eastern Europe where post-war territo- encounter in performing certain functions rial reforms have endured, a form of without undermining the pre-existing mu- re-establish local representation for the old local authori- nicipalities. France and Hungary provide community ties was maintained in the expanded illustrative examples of this approach, local councils (Poland, Bulgaria). This which encourages political vitality in local institutions at the was also the strategy adopted by community institutions rather than work- Lithuania for its 1995 territorial reforms, ing against them. But, the expansion of infra-community which divided the country into only 60 the functions performed at the inter-munic- level district municipalities. ipal level raises the problem of the demo- cratic legitimacy of inter-municipal ins- However, highly urbanized countries titutions, which are at present formed by the that underwent major amalgamation of municipal councils. municipalities are now seeking to re- establish local community institutions at It seems that instituting a second level of the infra-community level (Sweden, municipal government is probably a useful United Kingdom). These various devel- optioninorganizinglargeurbanzonesbecause opments and experiences should serve urban development does not follow municipal to draw attention to the importance of and administrative boundaries (Hoffmann- "minor local entities," as these are Martinot: 1999; Hoffmann-Martinot / Sellers: termed under Spanish law (in Castilla- 2005; Le Galès: 2002). In this respect, French La Mancha), for giving voice to local law provides for the status of "urban commu- democracy, and in particular to the nity" for the biggest metropolitan areas experiences of countries like Portugal (excepting Paris); fourteen have been created. and Bulgaria, where large municipalities The law also provides for the status of work by relying on strong infra-munici- "agglomeration community" for smaller urban pal institutions. areas(164establishedtodate).IntheNether- lands, a "cooperative framework" approach By contrast, the concentration of local has been adopted following the failure of an governments that came into effect in attempt through a 1994 law to create urban Denmark on January 1, 2007, reduced regions for the seven biggest metropolitan the number of local councils from 271 to areas of the country. The "cooperative frame- 98, and the number of "administrative work" is based on an inter-municipal public municipalities" (counties) from 14 to 5 corporation ­though without own taxing pow- "regions." This effort was driven by a ers. This formula has been revised by the law concern for economies of scale, taking ofDecember2005(lawknownas"RegioPlus") into account the predictable rise in withthepurposeofextendingittootherurban social expenditure, particularly for older areas. In Germany, Länder laws have on occa- people. While the local municipalities sion instituted similar types of urban area bod- run nearly all the public services, it is ies, for example for Frankfurt, Munich and planned to run the health service at the Stuttgart. In the case of Italy however, the level of the expanded counties Città Metropolitana, introduced by the law no. (regions). The counties will also take 142of1990,hasstillfailedtomaterializeprop- responsibility for public transportation, erly, even though it was enshrined in the Con- EUROPE 138 Decentralization and Local Democracy in the World Territorial Reform through Cooperation In France, a country of 36,000 municipalities, cooperation has long been the means to run the public services that single municipalities on their own cannot provide. But since the introduction of a law in 1999, supported by a strong com- mitment from the central government and financial incentives, inter-municipal public corporations with own tax powers have developed rapidly. These inter- municipal corporations are vested by the law with various strategic functions (e.g. planning, economic development, major capital investments etc.) and have own tax powers independent of those of member municipalities. At the beginning of 2007, 33,414 municipalities and 54.2 million people had been reorganized under 2,588 intercommunalités (inter-municipalities), as they have been called. In Hungary, a law from November 2004 provided for the development of inter- municipal cooperation within 166 micro-regions in order to meet local develop- ment objectives, the main one of which was to ensure that the management of public schools would be taken on by these inter-municipal corporations. At the beginning of 2006, such consortia had been set up in 118 micro-regions, and in 90 of these, all municipalities have joined the consortium. This was also the approach followed by Italy, with its unions of municipalities, and in Spain, with the bill on local government reform following the 2005 White Paper, which aims at encouraging inter-municipal cooperation9. However, the French intercommunalités will keep the distinction of having their own tax-levying powers and a wide range of functions provided for by law. stitution by amendment (new article 114) in the 25th July 2007 the formation of nine 2001. Only three perimeters have been drawn new unitary councils, and the Law of 30th up (Bologna, Genoa and Venice), but these October 2007 created the legal conditions only constitute rather loose frameworks for for the realization and the continuation of voluntary cooperation. In some regions, the process (Local Government and Public including Campania and Piedmont, the Involvement in Health Act 2007, c.28). provinces of the regional capitals would like to turn themselves intoCittà Metropolitana, but it II.3. Intermediate Levels seems uncertain that this will actually happen. Consequences on local democracy are not It is at the intermediate level that the most one-sided; they depend on the selected insti- important changes in the territorial organi- tutional setting. zation of states have taken place over the past two or three decades. Moreover, these In the United Kingdom, first- and second- changes have been both institutional and tier reforms are linked. The White Paper functional (Marcou: 2000 and 2002). 9. Whitebook for the published in October 2006 (Strong and Pros- reform of Local Governments, perous Communities, Cm 6939) provides for Historically, the intermediate level is Madrid, Ministry a further round of unitary council formation closely linked to the creation and aug- for Public in those regions where there is still a two- mentation of the state. More specifically, Administration. tier system. The government announced on it is essential for what has been called EUROPE Decentralization and Local Democracy in the World 139 "territorial penetration," the political and was increasingly responsible for, the Gradually institutional process by which centralized intermediate tier underwent two forms of the original powers were able to establish authority institutional and functional development. over all of their territory and the people They were, broadly speaking: 1) the consolidatingand within it. This has been illustrated in very establishment of a local authority evolv- centralizing different ways by France, Prussia and the ing to become more like a municipality, United Kingdom. Not all the European both as an institution and in terms of the missionofthe countries brought this process to comple- services it performed; 2) the differentia- intermediate tier tion; sometimes it was completed very tion and reduction of the administrative late or challenged by later transforma- tasks of the state. Since the end of the of government tions of the political scene. Moreover, 20th Century, regionalization has been gave way national boundaries have shifted consid- making its mark as a practical response erably, even in the past century. Some to new socio-economic and political to incipient once-powerful European nation-states developments. The transformation some- have disappeared altogether, including times manifests itself in the emergence of democratization Austria-Hungary, the Habsburg Empire, new territorial frameworks and institu- Prussia, and Yugoslavia. But territorial tions, but it is also apparent in changes penetration proved decisive in the forma- and reforms within existing institutions. tion of certain enduring territorial frame- works, including the département in Fran- Gradually the original consolidating and ce and the provinces of neighboring centralizing mission of the intermediate countries on which the Napoleonic model tier of government gave way to incipient left its mark. Also it was decisive in form- democratization. The election of a repre- ing the county in England and Sweden; sentative assembly gradually became the the district (Kreis, powiat, okres) in most rule in all the countries. Election of Central European countries; and the provincial councils in Belgium was based "government district" or primary division on the 1831 Constitution; that same year of a Land ­Regierungsbezirk­ in Germa- France introduced elections for the ny. Similarly, this organizational process departement; the Netherlands followed in affected such typical institutions as the 1853 with elections in provincial states; préfet or regional governor; in Germany it Prussia saw district elections in 1872; and was the Landrat. This functionary, who in 1888 Great Britain allowed elections for came to be known by several different county councils. The intermediate level titles, was appointed a senior civil servant local authority institutions later became in 1872 by the King of Prussia. At about more like municipal institutions, particu- this time, the Kreis acquired the charac- larly in the election of executive officers. teristics of a local self-government ­even The exceptions are Belgium and the as it continued to serve as the framework Netherlands where these offices remain for an administrative authority of the appointed posts at both the municipal and state. Thus, the original role of the inter- second-tier level, despite the law having mediate tier was to represent and relay been able to introduce an elective ele- the authority of the central power, either ment. (see section III). These local reliant on local aristocracy, as in England, authorities progressively took on tasks Hungary and Germany, or against them, designated by law to address experimen- as in France. tally two needs: 1) providing primary or supplemental services in sectors, such as Since the end of the 19th Century, how- health, roads and schools, which did not ever, under the influence of liberalism and normally come within the remit of munic- democracy, the intermediate tier evolved. ipal services; 2) promoting community Partly to accommodate the social and solidarity and equalization of social serv- economic tasks that the modern state ices and support for small municipalities. EUROPE 140 Decentralization and Local Democracy in the World Today these kinds of tasks are carried out cond-tier responsibility, they benefit from by second-tier local authorities in Central a reinforced status within the administra- and Eastern Europe, particularly in Croa- tive system. This was the situation in the v tia (Zupanije), Hungary (megyiei), Poland United Kingdom between 1888 and 1972 (powiat) and Romania (judet). They are (the borough-counties), and again after also part of the responsibilities delegated the removal in 1986 of county councils in to the Czech and Slovak "regions" (kraj). metropolitan areas. A decade later the United Kingdom saw the constitution of Three factors differentiate these second- unitary councils. A similar ascendancy of tier local authorities: size, urban adminis- the city occurs in Hungary where 22 tration system, and the presence or ab- towns have the status of megyei, in Ger- sence of competing sector-specific many with 116 kreisfreie Städte, and in authorities. Poland which accords to 65 towns the sta- tus of powiat. A similar system existed in In countries that were significantly Denmark before that country's 1970 ter- affected by the late arrival of local self- ritorial reforms. government in rural areas, or were heav- ily influenced by Germany or Austria, se- The presence of specialized sector-spe- cond-tier local authorities are apt to be cific authorities, such as hospitals, affects small (German Kreis and Polish powiat in the powers and responsibilities at the particular). Other countries have larger intermediate level. Public hospitals are in- authorities, including France with its corporated at the intermediate level local département, England and Sweden with government in Denmark, Sweden and counties, and Hungary with its megyei. Hungary, whereas they are part of a This applies as well to provinces in Bel- national organization in the United King- gium, Italy, the Netherlands and Spain, dom (the National Health Service), in nomos in Greece, and Czech and Slovak France with the regional hospital care "regions." Except for the Czech Republic agencies (though hospitals have kept and Slovak Republic, these territorial divi- their legal status as local public corpora- sions have ancient origins and are con- tions) and in Italy though the regions nected to the administrative divisions of finance "local health units." Similar the state authorities that preceded the arrangements also characterize the edu- creation of local authorities. But differ- cation sector in many countries. ences in size do not necessarily corre- spond to differences in responsibilities. In federal states and states with regional The responsibilities delegated to this tier autonomies, it is the federated states or of governance depend more on the extent autonomous regions which have taken on and nature of powers and responsibilities responsibility for these services, directly or exercised at the municipal level, the role indirectly. In Germany, the Länder are of state authorities, and the presence of responsible for education and for the statu- sector-specific authorities. tory regulation of hospitals, and also for investment in public hospitals. However, Cities in several countries are not management in these areas is devolved to included in the territorial framework of the districts. In Spain, public hospitals were second-tier authorities, though they may transferred to the autonomous communi- have similar responsibilities. This corre- ties in 2002. In the United Kingdom, the sponds to an institutional differentiation national health system is under the super- 10. The management of the health system is between city and countryside with respect visory control of regional authorities in not part of the local to the local authority system, the signifi- Scotland and Wales, but is nonetheless governments' cance of which has been emphasised. In organized according to sector-based princi- functions. countries where cities assume much se- ples10. In Belgium, health and education are EUROPE Decentralization and Local Democracy in the World 141 designated as "personalizable" areas per- state, and more generally with higher taining to the powers and responsibilities of authorities. Managing such a system has the communautés11. become an ever more complex business, as the powers and responsibilities of local The preceding examples indicate, that the authorities have expanded to cover tasks organization of the intermediate levels now important enough to merit regional or tends to be associated with developments national legislation and policies. The chal- towards regionalization. In functional terms, lenges to be met include how to apportion it is a response to the new importance and share powers and responsibilities, how given to territories with respect to eco- to finance local budgets and how to decide nomic development. In institutional terms, what administrative capacities local it is a formal recognition of the changes in authorities should and can have. responsibilities at the intermediate levels. However, regionalization manifests itself in In theory, it is the powers and responsi- states whose size, constitutions and terri- bilities to be exercised which determine torial institutions are extremely varied, and the level of resources necessary to cover which fulfil other tasks than those con- the corresponding costs. The European nected to regional development. If we also Charter of Local Self-Government puts it take into account the political factors, then this way: The financial resources of local the very great institutional diversity authorities should be commensurate with through which regionalization can manifest the powers and responsibilities they must itself is hardly surprising. In many coun- exercise as provided for by the law, and tries, it is limited to an administrative these resources must be sufficiently regionalization, i.e. it is based on institu- diversified and progressive to allow them tions subordinated to the central authori- to keep pace with the real changes in ties (e.g. England ­as opposed to other costs (Art. 9, paras. 2 and 4). In practice, parts of the UK­, Greece, continental Por- local finances are the product of each tugal, Bulgaria and Hungary). By contrast, nation's complex history of public finance, it gave rise to autonomous regions in some as well as its particular administrative countries (e.g. Italy, Spain, the status of history. More than any others, these fac- Scotland). In many countries, regionaliza- tors explain the various characteristics of tion is reflected in the kind of powers and local finance, as well as the size, in budg- responsibilities devolved to the local etary terms, of local powers and respon- authorities or to the institutions which sibilities. These same factors pertain to depend on them (e.g. Finland, Ireland, Ne- countries that only recently introduced therlands and Romania). Finally, other local self-government institutions, or are countries have simply extended their sys- in the process of doing so. Setting up an tem of local self-government to the efficient tax system and reorganizing regional level or have invested their interme- financial networks takes more time than diate level authorities with functions of changing the law does. Therefore, con- regional scope, without impinging on the sider the financial systems of local gov- unitary nature of the State (Denmark since ernment before moving on to compar- 1 January 2007, France, Poland, Czech Re- isons of powers, responsibilities and 11. These are public, Slovak Republic). administrative capacities. constituent members of the III.1. Finances Belgium federal III. Powers and Responsibilities, system, nowadays Management and Finances Financial autonomy is the basis of local run by institutions self-government, as stated in Article 9 of shared, or largely Local governments operate within a sys- the European Charter of Local Self-Go- shared, with those tem that requires interaction with the vernment, and it has three dimensions: of the region. EUROPE 142 Decentralization and Local Democracy in the World In most European resources must be in line with the costs with three tiers of local authorities (France, associated with the duties conferred upon Poland). Despite these approximations, countries local local authorities by law; the authorities the chart reveals three fairly distinct public expenditure must be able to dispose freely of the national groups: resources allocated to them; and they varies in reality must have certain powers to determine · Three Nordic countries (Denmark, Fin- between 6 % and the level of their own resources. land, Sweden) and Switzerland, whose local public expenditure is greater than 13 % of GDP However, despite the abundance of national 20% of their GDP; and international sources, carrying out an international comparison of local govern- · a large group of countries whose local ment financial systems presents real diffi- public expenditure varies in reality bet- culties of methodology and interpretation, ween 6% and 13% of GDP: in fact in even in Europe. In the following study, re- Italy, the expenditure of local councils gional autonomies have been treated as si- and of their consortia, and of the provin- milar to federal entities and have therefore ces, was around 6.3% of GDP in 2003; in not been considered as local authorities, the same year such expenditure in the contrary to how certain international Netherlands was 8.5%; sources erroneously represent them. · a small group of countries in which Analysis of major trends concerning ex- local public expenditure is less than penditure and resources reveals the grow- 5% of GDP: Greece, Cyprus, Former ing role of local authorities in Europe (Da- Yugoslav Republic of Macedonia and fflon: 2002; Travers: 2005). However, this Malta. increase in importance is often accompa- nied by a reduction in financial autonomy. In the median group, there is a contin- uum in which it is nearly impossible to III.1.1. Local authority expenditure place a threshold. But below 8% or 8.5% of GDP, we find only fairly small countries The following chart shows the proportion maintaining a certain financial centraliza- of each nation's GDP that is allotted to tion, along with the federal states and local public expenditure, based on figures states with autonomous regions (insofar published by Eurostat. The term local pu- as part of the expenditure borne by the blic expenditure refers to the expenditure local authorities in the unitary states is of local public authorities; that is, intra- paid for out of regional budgets.) national authorities with the exception of federal entities and regional However, the amount of expenditure autonomies12. Note that although Spain is alone is not enough to characterize treated as a federal state, Italy is not, financial autonomy. Functional inde- despite high levels of powers and respon- pendence also depends on how much sibilities for public spending, as well as leg- discretion a local authority has to allo- islation devolved to the Italian regions. The cate and commit its expenditures, and same applies to the United Kingdom with to manage its resources. respect to Scotland and Northern Ireland. Wales could also reasonably be included Figure 2 shows local authority capital ex- in the matter of public finances because penditure as a percentage of GDP. This of the volume of expenditure devolved to indicator helps show the role played by it. Although the European states usually local authorities with respect to the flow have one or two tiers of local authority, the of capital investment. It relates only to 12. See above : table slightly overestimates in comparative the Europe of the 25, as there is insuffi- footnote 2. terms local public expenditure for countries cient data for the other countries. In the EUROPE Decentralization and Local Democracy in the World 143 same year, public sector investment in takes into account only local authority invest- the Europe of the 25 was 2.4% of GDP, ments, and not those of federal entities. It with figures ranging from 1.1% for Aus- does however take into account the capital tria to 5% for the Czech Republic. expenditure of the autonomous regions in countries that have such entities, leading to What emerges from the chart is that local the aforementioned overestimate of local authorities represent the greatest share of authority investment. The same applies to public-sector investment, except in 10 coun- France with respect to the first and second tries: Austria, Cyprus, Czech Republic, Es- levels, because the regions, being local tonia, Greece, Hungary, Lithuania, Luxem- authorities, have a much greater investment bourg, Malta and Slovak Republic. The chart capacity; they currently account for about Figure 1 Local Public Expenditure as % of GDP Denmark 33.00% Switzerland 25.20% Sweden 25.00% Finland 20.10% Netherlands 15.47% Italy 15.40% Poland 13.50% United Kingdom 13.20% Norway 13.10% Hungary 13.00% Czech Republic 12.10% France 11.10% Iceland 10.13% Latvia 9.50% Romania 8.50% Slovenia 8.44% Lithuania 8.10% Austria 7.90% Croatia 7.50% Germany 7.30% Slovak Republic 7.00% Estonia 6.91% Ireland 6.80% Albania 6.70% Bulgaria 6.50% Portugal 6.30% Belgium 6.10% Spain 5.90% Montenegro 5.80% Serbia 5.60% Luxembourg 5.40% Greece 3.10% Cyprus 1.90% Macedonia, FYR 1.80% Malta 0.70% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% Source: Eurostat, 2005. EUROPE 144 Decentralization and Local Democracy in the World 10% of the real capital expenditure of local than running costs. Although there has governments and their public institutions. been dynamic growth over the past few years in local authority investment across Here analysis must be put in context to take the European Union as a whole, it has been into account the wider economic climate greater in the new member states; this and the stage of development for each sit- reflects the need for new infrastructure in uation. Macro-economic policies can have a these more recently admitted countries. heavy impact on local authority invest- Between 2000 and 2005, the average ments, as is the case for Austria and Ger- growth in local authority investment across many. Over several years, capital ex- the Europe of the 15 was 2.9% a year. At penditure can show greater fluctuations the same time it was 4.9% in the new Figure 2 Local Public Capital Expenditure as % of GDP Spain 2.5 Czech Republic 2.3 Ireland 2.3 France 2.3 Poland 2.1 Netherlands 2.1 Portugal 2 Italy 1.9 Luxembourg 1.7 Finland 1.7 Sweden 1.6 Hungary 1.6 Latvia 1.3 Slovak Republic 1.2 Denmark 1.2 United Kingdom 1.1 Greece 0.9 Belgium 0.9 Lithuania 0.8 Estonia 0.8 Cyprus 0.8 Austria 0.8 Germany 0.7 Slovenia 0.5 Malta 0.2 0 0.5 1 1.5 2 2.5 Source: Dexia, 2006. EUROPE Decentralization and Local Democracy in the World 145 member states, and there was negative the requests made by local authorities to growth in Austria and Germany13. the higher authorities that their resources depend on. Increasingly, legislation is pro- In the countries of the former Yugoslavia, viding that any transfer of powers and as well as Albania, Bulgaria and Romania, responsibilities prescribed by law must be central authorities at first kept control of accompanied by an adequate transfer of investment funds, including those for local resources. In France, this principle was public investments. This started to change first stipulated by a 1982 law, and later in 2004. There has been easier access to enshrined in the Constitution in 2003 (art. loans in Bosnia Herzegovina, Croatia, and 72-2, para. 4). In Germany, the constitu- the FYR Macedonia and Serbia. In Albania, tional review of August 28, 2006, provided a call-for-tenders procedure was intro- the occasion for enshrining in the Basic Law duced to select local projects receiving (the Constitution) a ban on using federal law state funding. In Bulgaria and Romania, to devolve material responsibilities to the role of local authorities regarding municipal councils and their consortia (new investment in economic or social infra- art. 84, para. 1). This was intended to put structure has been growing thanks to an end to the practice whereby the federal access to European funds14. legislator created new costs for local author- ities without providing the concomitant III.1.2. Local government resources resources. By contrast, within Länder, con- stitutional courts of Länder ensure that the Two questions arise concerning resources: principle of connexity is respected. the level of resources with respect to costs, and the degree of control the However, financial autonomy depends on authorities have over their capacity to the resource system and structure. It is increase their resources. here that the development of local finances is now showing signs adverse to The European Charter of Local Self-Go- local self-government. vernment stipulates that local authorities 13. Dexia, Finances must have "adequate financial resources a) The structure of resources publiques of their own, of which they may dispose territoriales dans l'Union européenne. freely within the framework of their pow- In most of the European states, the tax rev- Evolutions 2000- ers," and that the financial resources of enues of local authorities consist for the 2005, November local authorities must be "commensurate most part of shared taxes, for which the 2006 [Territorial with the responsibilities provided for by central authorities hold the tax-setting pow- public finances in the constitution and the law" (art. 9, ers. But the only ordinary revenue over the European Union. paras. 1 and 2). The first provision is a which local authorities have sufficient pow- Trends for 2000- condition for local freedom; the second is ers, allowing them to vary the amount of 2005, November a guarantee for local authorities that they resources through their own direct decision- 2006]. should be given the necessary resources to making, is own tax revenue and income 14. Ken Davey (2007), finance the tasks devolved to them by law. from fee-based local public services. As Fiscal income obtained from these local public Decentralization in The requirement that legally prescribed services depends heavily on how the serv- South-Eastern Europe, in: Council functions (duties) should correlate with the ices are managed ­directly by the author- of Europe, "Effective resources allocated ­known as the princi- ity, or by a utility receiving direct payment democratic ple of connexity­ is the most difficult one from the users­ the most significant vari- governance at local to satisfy because it depends on how costs able with respect to the local authorities' and regional level", are calculated. This calculation in turn ability to determine the development of Budapest, OSI, depends on the level of services deemed their resources through their own decision- Skopje conference sufficient and practicable for the popula- making is local own tax revenue. Con- papers, 8-9 Nov. tion. This requirement is at the heart of versely, their part of shared taxes, from the 2006. EUROPE 146 Decentralization and Local Democracy in the World economic as well as the political point of elected representatives have no say in set- view, is equivalent to receiving grants ting the tax rates and there is no connection (transfers). The only difference is that the between the rate of taxation and the num- local authority's allocation is sometimes cal- ber and quality of services provided. culated on the basis of local tax revenue. For example, in Germany, the municipal The differences among the various Euro- share of income tax is related to the local pean local government finance systems yield of the income tax; the idea here is that stem from their different sources of local the taxpayer is supposed to be pleased budget resources. All draw in particular on knowing that part of their tax is helping own tax revenue, on various kinds of finance local public services. Even so, their grants, on shared taxes and on revenue Figure 3 Structure of Local Budget Resources: Own Tax Revenue and Grants or Shared Taxes 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Albania (2005) 47% 40% Germany 51% 18% Austria 36% 14% Belgium 42% 45% BosniaandHerzegovina 62% 0% Bulgaria (2005) 58% 10% Croatia (2005) 61% 5% Denmark 18% 50% Spain 55% 27% Estonia 88% 1% Finland 22% 42% France 23% 57% Greece 42% 31% Hungary 60% 34% Ireland 46% 26% Iceland 8% 70% Italy 61% 24% Latvia 73% 15% Lithuania 21% 78.30% Luxembourg 35% 32% Montenegro (2005) 32% 15% Norway (2003) 36% 43% Netherlands 57% 7% Poland 67% 33.50% Portugal 45% 32% Czech Republic 71% 3% Romania 55% 8% United Kingdom 64% 13% Slovak Republic 38% 14% Slovenia 61% 19% Sweden 13% 57% Switzerland 22% 44.35% Tax shares + general grant as % of the total income Own tax revenues (= tax revenues subject to a local tax power) as % of the total income Source: DEXIA 2002, Council of Europe, 2003 or 2005. EUROPE Decentralization and Local Democracy in the World 147 from service delivery. However, they enough to allow local authorities to estab- In only eight diverge in the different weighting given to lish their own fiscal policies. Conversely, in countries is own their income sources, and in the character- the countries where own tax revenue is istics of the most important ones. We can considerably lower than income from grants revenuegreater for example distinguish local finance sys- or tax shares, and is considerably lower than the total tems according to whether the resource than 30% of total resources, it can be said structure is governed by own tax revenue that such resource systems are governed revenuefrom or instead by grants, including allocations by grants. In this case, own tax revenue national tax shares carved from national tax revenues. Figure theoretically helps fund non-mandatory No. 3 compares these two types of expenditures, such as those for discre- and grants, and is resources against the total resources of tionary tasks, or helps pay for costs that are in excess of 40% of local authorities in the majority of Euro- insufficiently covered by grants and tax- pean countries. As in previous charts, this share revenues. But the lower own tax rev- the total revenue one takes into account only the local level, enue is as a proportion of total resources, usually one or two tiers, but three in France the more difficult it is in political terms to and Poland and not the federal entities and raise extra resources because a significant autonomous regions. This chart also increase in resources necessarily implies a includes data available on Albania and significant increase in tax rates. This politi- some states from the former Yugoslavia. cal aspect may change where the central government puts pressure on local authori- The chart shows clearly that own tax rev- ties to raise local taxes or cut expenditure 15. Lithuania is not enue is greater than the total revenue from by rationing budgetary transfers and included as there national tax shares and grants in only eight national tax shares. However, connection are clearly errors in countries15 ­Belgium, Denmark, Finland, charges and user fees paid locally for serv- the statistical France, Iceland, Norway, Sweden and ices can provide alternative non-tax classification of their Switzerland. In all these countries, the in- resources, especially at the local council resources: in 2002, come from own tax revenues comprises level. Increases in local service charges and the local tax more than 40% of the total for local budget ancillary fees are apt to be accepted more revenue of local resources. In the other countries, own tax easily than higher taxes. A final point on authorities did not revenue falls below 35% as a proportion of this matter: in the central and eastern exceed 8.4% of the total resources, except in Albania where it European countries, property revenues total of their resources (G. reached 40% after reforms took effect in (income from alienation or licensing) can Marcou, Les 2005. It rises above 30% only in Greece, continue to play an important role and to structures Hungary, Luxembourg, Poland and Portu- increase the proportion of local resources régionales dans les gal. But even in these countries the propor- kept under the control of local authorities; pays candidats et tion of grants and national tax shares re- this is only a transitional situation, but it is leur compatibilité presents a much higher percentage of just what is needed to facilitate transition. avec les fonds resources (except in Luxembourg). structurels (Europe b) Own local tax revenue centrale et Analysis suggests that there are indeed dif- orientale) [Regional ferences among the various local finance As far as the structure of own taxation is structures in systems that operate with between 30% concerned, there are several observations applicant countries and 40% of resources coming from own tax worth consideration. All countries except and their compatibility with revenues. Such resources are greater than Sweden collect property tax, and this tax is the structural funds those from grants and shared taxes. When generally held to be the most appropriate (central and eastern these two conditions are met, it can be said one for local taxation because of the local- Europe)], that the resource system is governed by ization of the tax base. This view is shared Luxembourg, local taxation. Grants then have the role of by most governments throughout the world. Parlement européen providing a basic source of funds or of fund But this tax is dependent on the existence of STOA 105 FR, 2002, equalization, or of offsetting costs pre- a fully-functioning land register. As yet no [Part B: country scribed by the law. The own tax revenue is such system functions properly in the Cen- files]). EUROPE 148 Decentralization and Local Democracy in the World tral and Eastern European countries, some Overall, the general tendency has been to of which have no register at all. Local taxa- squeeze own tax revenues as a proportion of tion of households is rarely based on a local the total resources of local authorities, to income tax, though it is the practice in the benefit resources whose variations are con- Nordic countries and in Switzerland; these trolled by the central authorities. In France countries also have the highest levels of as in Germany, the tax base for the business local governmental expenditure. In many tax has been reduced. In France, the busi- other countries income tax is a shared tax ness tax rate was capped at 3.5% of value whose yield is partly or wholly allocated to added, a move that affects nearly half of local budgets. For example, shared income those qualifying to pay the tax. In the taxes account for part of the local allocations Netherlands in 2006, local property taxes in Austria, Germany, Hungary and Poland; were abolished for tenants and capped for all income tax revenue is used to fund local landlords, resulting in a reduction in financial budgets in Bulgaria, Croatia and Romania. autonomy. Sweden and Italy, each within In some countries, local governments can very different contexts, have proved to be vote for an additional income tax, calculated remarkable exceptions to this general ten- on top of the state tax (Switzerland) or dency to shrink own tax revenues. The same based on the income tax revenue leveled has been true since 2005 in Slovak Republic locally (Croatia). One advantage of channel- where new local taxes have replaced the The general ing income tax revenue to the local level is allocation of grants. In Sweden, own rev- the taxpayers' increased perception of a enues still provide more than 70% of the tendency has been direct connection between taxes paid and resources of local authorities. Italy, since services used. In Greece, local taxation 1992, has continued the process of restoring to squeeze own tax mainly comprises taxes that represent fund- own taxation, which was virtually abolished revenues, and to ing for public services, and not taxes in the in 1971 in an effort to promote equalization. strict sense. This was also the case in France All this means that in most countries, secur- prioritize securing with the taxe d'habitation (community char- ing resources is prioritized over financial revenues over ge), that is now a direct tax; there is also responsibility. The rules used for calculating the same process with the tax for household shared tax allocations, insofar as these are financial refuse collection that has in recent years relatively stable or negotiated (as in Austria responsibility been used as an adjustment variable by or Germany) and the guarantees pertaining many local and intercommunity councils to changes in grants (as in a "stability pact") voting rates higher than needed by the ser- ensure that there is a certain balance vice costs. between resources and costs ­ within the limits allowed by the economic situation. By contrast, fewer than half of the Euro- pean Union countries have a local tax c) Other funding techniques specifically levied on economic activity: Austria, Cyprus, Denmark, France, Ger- Among the alternatives to public budget many, Hungary, Ireland, Luxembourg, Por- funding that have emerged and developed tugal and Spain. The tax base for eco- in recent years to fund investments are the nomic activity is variable, but considering various forms of public-private partnerships local tax revenues and budget levels as a (PPPs) inspired by the British Private Finance whole, this tax is only a significant Initiative (PFI) of 1992. Since the end of the resource in France, Germany, Hungary, 1990s, many countries have adopted legis- Ireland, Luxembourg and Spain. More- lation on PPPs which, under the various legal over, it is vulnerable to economic policy formats in different countries, nonetheless measures aimed at reducing the burden of follows the same basic process: the public businesses; such measures have reduced authority entrusts a company or a consor- this tax base in recent years, particularly tium with an overall mission of designing, in France, Germany and Spain. realizing, financing and operating or main- EUROPE Decentralization and Local Democracy in the World 149 taining a public works on the local govern- responsibilities, before reviewing the func- ment's behalf. This widens the possibilities tions (Committee of Regions: 2002; Mar- traditionally offered with the system of con- cou, 2007). cession. The real reason for the develop- ment of PPPs is a budgetary one. III.2.1. Categories of powers and responsibilities Results have been mixed. Even in the United Kingdom, PPPs do not account for The first thing is to note how the general more than 11% of public investment. This clause on the scope of local self-govern- limited success can be explained by the ment as provided under article 4.2 of the fact that conditions for local authorities' European Charter of Local Self-Govern- access to credit were very restrictive until ment has found widespread application, at the Local Government Act of 2003, so that least at the level of municipal authorities. the PFI represented the possibility of This clause is not concerned with the divi- accessing extra resources. sion of powers and responsibilities. Rather, it defines a principle of freedom. This prin- Although PPPs often help speed funding for ciple is of paramount importance, even if certain operations, they also have certain dis- the activities it sanctions remain modest in advantages. One is that capital raised by the budgetary terms. Most of the European sta- contract partner on the market will be tes at the Council of Europe level now re- obtained under less favourable terms than cognize the principle of the general clause those usually given to public authorities. Addi- as applying to local councils, through their tionally, the fees payable by the public author- constitutions or laws. A few countries, ity have to cover all costs, including the finan- including Portugal, the United Kingdom and cial ones, so that the PPP in effect turns the some Central and Eastern European na- debtintooperatingcosts,thoughthisdoesnot tions, are exceptions; Spain and Italy raise in itself assure an overall saving. Another questions of interpretation. point of concern is the private companies' push for higher profit margins for additional The fact remains that most of the powers risks they pretend to bear, and it is difficult for and responsibilities exercised by local public authorities to control these margins16. authorities are established by law. There is a In the other countries, the share of PPPs in noticeable general inclination to extend the 16. Numerous inquiries public investment continues to be fairly mod- scope of local authority, sometimes in the reported by the est, even if governments sometimes set form of "powers and responsibilities for spe- Committee of Public ambitious targets, as for example in France cific purposes" (as stated in art. 4 of the Accounts of the where the avowed goal is 10% by 2010. Charter) exercised in the name of the state House of Commons and under its direction. This is particularly suggest Such limitations of the PPP as a tool for the case in Germany, Austria, Italy, the cautiousness funding may explain the re-emergence of Czech Republic, Hungary and Slovenia. It regarding benefits funding bodies aimed solely at local author- leads to local councils exercising administra- that can be ities. Founded on a cooperative basis, they tive tasks traditionally performed by the expected by public are modeled on Kommuninvest, a coopera- state. This does contribute to the overall authorities from PFI tive body founded in Sweden in 1986 to empowerment of local government, but the (for example HC 567, 16 July 2003 ; provide funding to local authorities17. Until it real reach of this type of extension of pow- HC 446, 31 March was absorbed in a 1996 merger, Belgium's ers and responsibilities depends on the con- 2005 ; HC 553, 14 Crédit Communal was similar. trol exercised in practice by the state. June 2005 ; HC 694, 3 May 2006). III.2. Powers and Responsibilities In the Central and Eastern European 17. Kommuninvest states, the range of material tasks for consists of 196 It is necessary to make clear the status of which local authorities are responsible is municipalities and 7 the different categories of powers and vast, especially where they are the heirs to county councils. EUROPE 150 Decentralization and Local Democracy in the World local bodies formerly controlled directly by certain tasks are carried out by local coun- the central state. Exceptions are countries cils or their consortia in virtually all Euro- where a separate state administration has pean countries. Providing a slight variation, been re-established or maintained in some Portugal delegates these tasks to sub-divi- domains at the local level. The "powers sions of the local councils. These local tasks and responsibilities for specific purposes" typically include: town planning (urban plan- are then predominant in the mission of ning, planning permission, development local government, and can effectively keep projects), the allocation of social benefits local authorities in the position of being and the management of social institutions agents of the state. This is the case, for for certain categories of the population, par- example, at the regional level in the Czech ticularly for the elderly. They also include Republic. Because the resources provided roads and public transport, water distribu- to local authorities are hardly enough to tion (with the notable exception of England), finance the tasks delegated to them by the accommodation and housing (with the state, there is little time or occasion for notable exception of the Netherlands, Italy local bodies to exercise their autonomy. and Switzerland), and the construction and The most maintenance of school buildings. These days A more detailed study of the system gov- we can add to this list education support in important erning local powers and responsibilities all countries, along with actions for eco- variations relating also raises the question of how relevant nomic development, that can be carried out some commonly held distinctions are. Basic also through powers that are not specifically to powers and powers and responsibilities are always reg- deemed to this function, when they are not responsibilities ulated by law wherever they affect domains listed by the law. Together, these tasks can or tasks that have a national dimension be considered the common substance of occur in the fields (and are therefore mandatory). What then local powers and responsibilities in Europe. of education, determines the degree of local autonomy are the fine details and the scope of the The most important variations relating to health, and social pertinent legal regulations. In extreme powers and responsibilities occur in the security cases the regulations can make the system fields of education, health, and social governing such functions almost indistin- security or benefits. Broadly, local go- or benefits guishable from the system governing dele- vernments by national law are responsi- gated tasks. Such a situation led to reforms ble for such services in the Nordic coun- undertaken in the Nordic countries in the tries and to a large extent in the United 1980s. These reforms were often grouped Kingdom. As of this year, regional author- under the term of "free municipality," and ities in Denmark have overall manage- their aim was reducing the heavy burden of ment of healthcare and the health insur- national regulations and financial controls ance system, which had previously been on local governments. In some countries run to a great extent by the counties. In the courts occasionally can ensure that Sweden, social security is managed at the regulations respect the rights of self-gov- national level, but the counties run the ernment by censuring provisions deemed hospitals and the healthcare system. In to exceed the stated aims of the regula- Germany, France, Italy and Spain, on the tions, as in Germany, but such judicial other hand, local governments exercise intercession is unusual. only partial or marginal powers and responsibilities in these areas. The same III.2.2. Functions applies to education: the recruitment and management of staff is generally the task Regarding functions effectively exercised in of state or regional authorities. This is a application of the law, we will limit our study duty of German and Austrian Länder, of to the level of municipalities and their con- the autonomous communities of Spain sortia. A detailed comparison reveals that and in Belgian communautés. In the EUROPE Decentralization and Local Democracy in the World 151 Nordic countries it is the responsibility of III.3. Administrative Capacity municipalities, as it is still to a large extent in the United Kingdom. In Italy, Administrative capacity depends on the education is outside the domain of human resources and style of management, regional authorities. both of which have undergone important changes in the past few years. Public safety responsibilities are also devol- ved to local governments in many, though III.3.1. Human resources not all, European countries. In Belgium, the Netherlands and the United Kingdom public There are substantial differences in the safety by tradition is an important responsi- staffing levels of local governments. Unsur- bility of the mayor or other local authorities. prisingly, these differences reflect those al- By contrast, in Germany, Hungary and Swe- ready noted for the powers and responsibili- den, public security hardly appears at all in ties: countries in which local government and the remit of local governments. particularly municipalities manage both essential public services and the human re- In the Eastern European countries, respon- sources they require, are the countries with sibility for education and health varies con- the highest staff levels. In the Nordic coun- siderably, even within individual nations tries, Switzerland and the United Kingdom, over time. In Bulgaria for example, man- local government staff represent about 80% agement of the health system and the of the total for public sector employees (63% schools was first assigned to municipalities, in Norway). These employees for the most but was returned to the state level in 2003. part work in education and the health serv- In Albania, these tasks have been financed ices. Despite an extensive range of functions, out of the state budget since 2003, even local governments in Eastern Europe have far though the local councils administer the lower staffing levels (around 40%), except in staff payroll. In Hungary, Lithuania, Poland Hungary (69%) and Slovak Republic (90%) and Romania, the management of schools (CNFPT: 2005; Pollitt / Boukaert: 2004). and education staff is decentralized. In Estonia, Latvia, the Czech Republic, Slovak The political structure of a state hardly Republic and Slovenia, on the other hand, impinges on these staffing issues. In fact it it is divided between the state and local tends to be in unitary states that we find governments, the state retaining responsi- the proportionally highest levels of staff bility for staff management. employed by local governments. For the most part, levels of employment for local Movement toward centralization can be governments are similar: for example they seen in several countries in the areas of are 28% in Germany, 31% in France, 24% education (United Kingdom), health in Spain, 34% in Belgium, 19% in Italy and (Norway) and public safety (Belgium, 18% in Portugal. Federal states and states Netherlands). However, in many other with autonomous regions, for their part, countries local councils are getting more are distinguished by the lower staffing lev- involved in education, as well as public els of their central civil service. Local safety. Previously, local councils in these staffing is also comparatively low because countries had had only limited adminis- the bulk of their human resources are trative responsibilities in these areas. A employed at the regional level18. The lower third approach is favoured in the Nether- staffing levels of local governments in lands, Sweden and the United Kingdom: Greece and Ireland also reflect their limited enlisting the private sector. In these three powers and responsibilities. countries, management reforms focused on attracting the private sector have In recent years, local governments of many 18. Pollitt/Bouckaert reduced the remit of local governments. countries have had to cut staff levels be- (2004), p.44 et seq. EUROPE 152 Decentralization and Local Democracy in the World cause of budgetary constraints and the ment conditions and incentive-based re- outsourcing of many activities. Outsourcing muneration, thus taking their inspiraton increased markedly after the implementa- from the message of "New Public Manage- tion of strategies inspired by the "New Pub- ment", they continue to take different lic Management" philosophy, and measures forms depending on specific national tradi- aimed at improving performance. tions. While some countries have gone more determinedly down the path of con- Staff skills and qualifications are also im- tract-based employment, others have portant factors affecting the quality of local maintained the professional career struc- public service. Best practices include re- ture as their main system. In many cases, cruitment based on merit so the impartial- the outcome has been hybridization, mi- The countries that ity of the public service is protected. A rea- xing features from both models. sonable level of personnel mobility among have gone furthest local governments makes it easier for small The countries that have gone furthest in in aligning the and medium-size governments to attract aligning the status and conditions of local qualified staff. There are many ways of government staff with those of the private status and achieving these objectives, but equally, sector under labor laws include the United conditions of local authorities can fail to achieve them because Kingdom (where there is no history of a of an inappropriate employment system. legal distinction between public and pri- government staff vate sector employment) and a group of with those of the In the employment structures of local go- countries that have almost entirely aban- vernments, as is the case for public admin- doned their old career employment struc- private sector istration in general, we can identify two tures in favor of a contract-based system. under labor laws types of system: These countries are Sweden (1974), Den- mark (1969) and Italy (1993). In most include the United · A career employment structure gover- countries, the contract-based system has Kingdom , and a ned by public law, essentially characte- been partially introduced while maintain- rized by a system of appointment and ing a career employment structure for group of countries job security; managerial posts. Such "mixed" systems, that have almost with their strong element of career · A contract-based employment structure employment structure, are particularly entirely abandoned with private law as the reference, and common in Germany, Finland and Switzer- no guarantee of job security. land. In Germany, this system has long their old career been a feature of local governments, the employment But the employment systems in the Euro- great majority of staff being employed on pean countries vary widely, and often fixed-term contracts; but the two systems structures in favor include a mix of methods. Moreover, certain have ended up converging: after 15 years of a contract-based situations can be misleading, and public law of fixed-term work, staff are given a per- structure and career employment structure manent post. system do not always come to the same thing in practice. In the Netherlands for example, a In the post-communist countries of Central contract employment system prevails and Eastern Europe, building employment within a public law structure, while in Italy systems for local government was an un- and the Czech Republic, local authority certain process throughout the 1990s. The employees have access to a career path form of local employment system that each within an employment structure determined country chose, often after going through by collective agreements. various changes, depended on specific national traditions, different reactions to Although local government employment the post-communism transformation, and systems have been developing in the efforts focused on training qualified staff direction of increased flexibility of employ- and preventing corruption. In addition, EUROPE Decentralization and Local Democracy in the World 153 Table 2 Typology of European Countries According to the Employment System of Local Governments Public or private law career structure Public law career structure [Contract-based] private for executive and managerial posts applied generally or public law employment Albania Belgium Bulgaria Austria Cyprus Denmark Bosnia and Herzegovina France Macedonia, FYR Croatia Greece Netherlands Czech Republic Hungary Norway Estonia Ireland Poland Finland Latvia Slovak Republic Germany Lithuania Sweden Italy Luxembourg United Kingdom Serbia Malta Switzerland Montenegro Portugal Romania Slovenia Spain countries preparing for accession to the management and a key role in the relations The career system European Union made changes to accom- between managers and the political staff. tends nevertheless modate the process of accession itself. The Furthermore, in many other countries, we combination of all these factors yielded dif- find the vast majority of staff employed toprevail,in ferent results in different countries. Thus, under a public law career structure. These particular for some systems lean more toward contract- observations can be summarised as in based employment, particularly in Bul- Table 2 according to the dominant feature executive and garia, Poland and Slovak Republic, while of the employment system. managerial the career employment structure predomi- nates in Hungary, Latvia, Lithuania, Ro- A major criticism of public administrations positions mania and Slovenia. based on the career employment structure is lack of recognition for good performance by The fact remains that overall, the career the remuneration system. Another is that employment structure governed by public promotion tends to be heavily based on law is still predominant. Applying labor law to length of service and seniority. The aim of public service presupposes that there is a policies to move from career employment system of strict collective agreements in structures to a contract-based system was place, which cannot exist without powerful made in order to introduce elements of in- local authority associations and equally ternal competition and a system of incentive- powerful trades unions. However, this is the based remuneration. Systems with the case in only a handful of countries. We strongest focus on incentives seem to be should not be misled by the coexistence of those introduced in the United Kingdom, two employment systems, because when Sweden and Italy. However, a move towards this is the case, the public law career struc- incentive-based remuneration can be noted ture does in fact apply to the executive and within career employment structures as well. managerial positions, even if staff on fixed- term contracts are sometimes employed in In countries where employment systems such posts. It has kept therefore a decisive continue to be dominated by public-law place in the system of human resources career structures, the move toward more EUROPE 154 Decentralization and Local Democracy in the World flexible payment and promotion systems of 2001: management based on programs has been slower and less marked. and directed to results) is discussed. Nonetheless, they are now making demon- strable headway in Germany and France. In the Central and Eastern European coun- tries, the traditional model was first used to III.4.1. Management Reforms set up the new administrative structures, so the managerial model has been slower From the beginning of the 1980s, the to filter through. process of modernization has been driven by New Public Management (NPM) ideas, In the debate on modernizing the public sec- though the vogue for these seems to be tor, two arguments were advanced to pro- diminishing (Pollit / Boukaert: 2004; Ker- mote privatization and the market (Lorrain / sting / Vetter: 2003). Stoker: 1996). The key idea of NPM was to overturn the First, turning to privatization was advo- inflexibility and inefficiency traditionally cated as a means of reducing the weight of attributed to public administration ("let the central functions of the "welfare state" managers manage") and to replace its sys- by letting market forces take over. The idea tem of hierarchical control with manage- of the "lean state" (Etat modeste, European ment based on indicators, feedback and schlanker Staat...) has been widely pro- follow-up. moted since the 1980s at both national and Community law has international levels. In the United Kingdom after 1979, the re- a decisive influence forms forced local authorities to accommo- Moreover, turning to the market for the on how the date in their organizational structure for supply of services was advocated on the services a separation between the roles of grounds that public authorities should be management of buyer and supplier, and to open their serv- restricted to an enabling function. Actual public services ices to competition by soliciting outside performance of public services should be suppliers (competitive tendering). In 2000, contracted out to private companies on a evolves these principles came under review upon competitive basis. The European Commis- and develops the arrival of a new program dubbed "Best sion also argued for this approach with the Value Authorities," which puts a greater aim of promoting the single market. stress on performance over costs. The sep- aration of the roles of buyer and supplier These tenets had perhaps their greatest was also introduced for local authorities in impact in Sweden and the United King- Sweden. In Germany, this trend took the dom, because it was there that the local form of a "new management model" (Neues public sector monopoly was most exten- Steuerungsmodell), which challenged the sive. But in Sweden, only about 15% of traditional primacy of legality and hierarchi- municipal services have been effectively cal control. In France, the 1983 elections contracted out. In the Central and Eastern led to the election of mayors claiming to be European countries, where social services inspired by a new concept of municipal were wholly delivered by the state or by management, whereby a town was to be public bodies under the communist sys- governed like a commercial company. How- tem, there have been fundamental ever results of municipal elections have changes in the management and range of indicated that this model has lost its attrac- services offered. The private sector now tion. Even so, they have not signaled a plays an increasing role in their delivery. In move away from modern management Germany however, where most social techniques. At present, the extension to services have traditionally been delivered local budgets of the principles of the state by private non-profit bodies (freie budget reform (organic law on budget laws Wohlfahrtsverbände), the local authorities EUROPE Decentralization and Local Democracy in the World 155 concentrate on organizing and monitoring other countries have sought to restrict the tasks. The impact of NPM was thus rather freedom of local authorities in this respect, limited, though it did later lead to a diver- in the name of opening up the market (Italy sification of "suppliers." In countries like and the United Kingdom, in particular). In France and Spain, with a long tradition of the same way, the new regulation devolving the operation of local public 1370/2007 (23rd October 2007) concerning services to the private sector, the NPM public rail and road transport puts an end to principles did not seem of much relevance, the exception that preserves urban and although new tools to facilitate recourse to regional public transport from open compe- the private sector have more recently been tition. However, competent local authorities created. But the focus on performance as still have the possibility to provide public the driving force has gained a lot of transport services directly or through a sep- ground, both through state interventions arate entity over which they exercise a sim- (for example, reforms in France of local ilar control as for their own services and to accounts models) and through initiatives which they may assign the service directly. taken by the local authorities themselves. The urban transport systems of numerous large European cities will necessarily be European Community law has a decisive reviewed when the new regulation comes influence on how the management of public into force (3 December 2009). The free The election of services evolves and develops. This is choice of local authorities regarding the municipal councils because all services that can be classified as operational system will therefore be limited. services of general economic interest ­as By contrast, most Services of General Inter- or local defined under article 86.2 of the Treaty on est (SGI) should not be affected by the governments, by the European Community­ are subject to application of the so-called "Services" direc- the rules on competition, unless these rules tive of 12 December 2006. direct, free and impede the realization of their mission in secret universal conditions compatible with the viability of the enterprise. According to the Court of IV. Local Democracy vote is today Justice, if a local authority decides to a reality in all the devolve the operation of a public service to The main trends we can identify can be a private company, that local authority presented by distinguishing among local countries of the must use a competitive [tendering] proce- political systems, supervisory structures, dure. This applies even if the authority itself the impact of decentralization on national Council of Europe has created a local enterprise specifically to policies, and the role of the associations of deliver the service in question, unless it can local councilors and mayors, and of local establish that it exercises the same control governments. over this enterprise as it does over any of its administrative services (known as the IV.1. The Local Political System "in-house" exception). For the Court, it suf- fices that the company has external share- The election of municipal councils, or holders, even if only minority ones, to inval- more generally of community-level local idate this latter condition. The result is that governments, by direct, free and secret integration through the market, as inter- universal vote is today a reality in all the preted by the Court of Justice, means that countries of the Council of Europe. A look the freedom of local authorities to choose back over even recent history is enough how to manage the public services they are to show what important gains have been responsible for is restricted. This applies made. As far as intermediate-level local even though this freedom has long been governments are concerned, the situation considered an important part of local self- is a little more complex: In some cases, government in many countries, including indirect elections seem to be a better France, Germany and Spain. Of course, option for linking intermediate-level tasks EUROPE 156 Decentralization and Local Democracy in the World with local-level responsibilities. This is executive body is a collegiate executive desirable to prevent legitimate interests body whose other members are elected by at the middle level from competing and the council. conflicting with those of local councils, and also to protect the independence of In the United Kingdom, the Local Govern- the latter, as exemplified by regional ment Act 2000 led local authorities to aban- authorities in Ireland, regional councils in don the traditional system of council com- Finland and Romania, and provincial del- mittees exercising executive tasks, to egations (deputación provincial) in Spain. differentiate the executive and non-execu- The provincial delegations in Spain are tive roles and, in some circumstances, to considered part of the local level and are submit to referendum proposals for a local meant to serve the local councils. How- constitution that could include direct elec- ever, it was decided in Norway and Hun- tion of a mayor. But these reforms did not gary not to use indirect elections for the receive the expected support. Among the county-level councils. 386 local authorities potentially qualifying for an elected mayor, referendums had The most The most significant developments have been held by only 31 local authorities by the significant taken place in the executive ranks of com- end of 2006. The results favored the direct munity-level local governments, namely election of a mayor in only 12 referendums. developments have for a certain personalization of the execu- However, a feature of these reforms is that taken place in the tive role and for direct elections (Bäck / local residents can take the initiative to hold Heanelt / Magnier: 2006; Szücs / Ström- a referendum on the role of mayor by sub- executive ranks of berg: 2006). The most typical changes mitting a petition, signed by 5% of regis- community-level here occurred in Italy, Germany and the tered voters, to their local authority. A less United Kingdom. In Germany, the former well-known aspect of the reforms, but one local governments, variety among municipal institutions has with perhaps a greater impact over the long namely for given way to a unique model, broadly term, is the differentiation of the executive speaking characterized by the election of and non-executive roles. This should lead to a certain mayors by direct universal vote, and the an enhanced role for local councils in pro- personalization possibility of removing them from office. viding policy guidance, and also supervision Italy has introduced the direct election of with respect to the executive bodies. The of the executive mayors, provincial presidents, and October 2006 White Paper has resumed regional presidents. In the United King- revitalizing institutional reforms by reinforc- role and for direct dom, following the election of a mayor of ing political leadership in the local authori- elections London by direct vote, the law has also ties. "The Local Government and Public provided for other cities to adopt a similar Involvement in Health Act 2007 (c.28) model, along two variant forms. In Central makes possible the election of the council in and Eastern Europe, mayors are elected by one ballot and requires the choice between direct vote, except in the Baltic States, two alternative executive formulas: a leader Poland, the Czech Republic and Croatia. elected by the council or a directly elected The question is being debated in Belgium mayor, who, in either case, then forms his and the Netherlands. In the Netherlands, a cabinet by appointing at least two members draft bill to amend the Constitution to allow of the council". the election of burgomasters failed in 2005, so these officials continue to be Useful parallels emerge here with the Ne- appointed by central government on the therlands reforms known as "dualization" basis of nominations from the municipal (dualisering), introduced by the laws of councils, but with the nominations being March 7, 2002, governing municipalities open to citizen consultations. Mayors con- and January 16, 2003 governing provinces tinue to be appointed in Belgium and Lux- (amending the law of September 10, embourg, but, as in the Netherlands, the 1972), providing for a separation of the EUROPE Decentralization and Local Democracy in the World 157 executive branch from the assembly. tion) meant that the councils could have Henceforth, the aldermen (at the province their own choices on their administrative level, the deputies) can no longer be mem- organization in relation to their functions; bers of the council, and nearly all adminis- they have also reinforced the executive trative powers are concentrated in the council's management lead role in the va- executive body. To balance this, the legisla- rious specialized sectors. tors wanted to reinforce the assembly's role of policy guidance and supervision. For local assemblies, the changes are less The split timing of the different mandate clear. There appears to be a definite ten- terms also contributes to this dualization: dency toward what is called "parliamenta- four years for the council and aldermen, six rization." This condition is characterized years for the mayor (the Queen's commis- by a reinforcement of the rights of coun- sioner). cilors, and the possibility of calling the executive branch to account politically. Behind all these developments and re- This is particularly evident in Spain in the forms, apparently very different in spirit, devolving of powers and responsibilities In all of these lies the same key goal: restoring or rein- from the council to the mayor. One countries, forcing political leadership in local govern- avowed aim of this reform is strengthen- ments, and above all at the municipal ing the executive branch's capacity for there is a clear level. Of course this has not been an issue action, particularly in the major cities trend toward in countries like France or with the Länder (laws of 1999 and 2003). Calling the in the south of Germany. In both places, mayor to account can in some countries professionalizing the figure of a strong mayor is deeply require a procedure for recall by the citi- the status of local rooted in history. But it should be noted zens. This kind of procedure is seen in that all of the Western European countries most of the German Länder as well as executiveofficers, mentioned here have either traditionally some Central European countries, includ- and toward had a collegiate local executive body, or ing Poland, where several such cases have not had an executive body that was have occurred. In a more general form, strengthening distinct from the council. In most countries we are seeing political groups gaining the professional in Eastern Europe, it was the desire for official recognition in local assemblies of democracy that drove the introduction of the larger local governments. As in safeguards directly-elected mayors. However, it is France, these political factions have cer- clear that the various countries have very tain rights recognized by the law in larger necessary for the different approaches to this issue. In most councils. This is a form of legal acknowl- exercise of their cases, direct election of mayors has edgment of the role of political parties in seemed the best way to guarantee political the running of local institutions. mandate accountability, to the extent that their mandate is renewable. But in the Nether- The increasing responsibilities of local go- lands and probably in the United Kingdom, vernments have inevitably affected the the preferred approach to reinforcing polit- status of elected officials (Guérin-Lavig- ical leadership is to focus on strengthening notte / Kerrouche: 2006). In all of these the political role of the councils. This ambi- countries, there is a clear trend toward tion was also in the background of the so- professionalizing the status of local exec- called "free community" reforms in the utive officers, and toward strengthening Nordic countries in the 1980s, which the professional safeguards necessary for gave municipal councils the freedom to the exercise of their mandate. This ten- determine the internal organization of dency to professionalize manifests itself local government. Previously, the execu- also in the move away from a system of tive committees had been determined by remunerative allowances to one of real law. The reforms (see in particular the salaries, complete with social security and Swedish law of 1991 on local administra- pension rights. In tandem with this, there EUROPE 158 Decentralization and Local Democracy in the World is a move toward preventing officials from IV.2. Citizen Participation assuming several executive roles. In East- ern Europe, the former classification of These developments have been accompa- local executive officers as civil servants nied by another notable change, increased has acquired a particular relevance in the citizen participation that alters traditional new institutional context. In Germany, a political dynamics. The most obvious form full-time mayor is classified as a public- is the referendum, particularly the citizens' sector employee for the duration of his referendums initiated by popular demand. mandate; in most of the other countries, This is being increasingly provided for by such status is only partial. the law, though actual use of referendums is still rare, except in Switzerland and to On the other hand, the situation for ordi- some extent in Germany where they are a nary councilors ­the members of the delib- traditional institution. erating assemblies­ is generally speaking less satisfactory. The system of leave of This should be contrasted with the increas- absence, paid leave and compensation for ing importance given to infra-municipal enti- loss of income that are thought necessary ties, which allow a representation and a par- In Eastern Europe for exercising their mandate often provides ticipation of citizens at the closest possible insufficient protection. The training of level to where they live. These entities are local elections elected officers is poorly organized, and the essentially to be found in countries with provoke system for defining ineligibility and inappro- large municipalities. They are traditional in priate practices, aimed at preventing con- Bulgaria, and in Portugal their role appears dramatically lower flicts of interest and improper use of certain to be growing, which in turn is giving rise to participation than positions, falls short of acceptable stan- criticism from council management view- dards in many countries. point. They can be found in countries that national elections, have undergone territorial reforms, but perhaps reflecting a Despite all these reforms, one trouble- without a role in local administration; in some fact continues to haunt the modern such instances they are intended more to general feeling that electoral process: low voter turnout for maintain a representation to legitimize the local authorities local elections (Gabriel / Hoffmann-Mar- amalgamations, such as parishes in Eng- tinot: 1999). Declining voter participa- land, communities in Wales and villages in don't have much of tion and stagnation in voter numbers Poland, Greece and Lithuania. These can be reflect a worrying disaffection with poli- compared to the neighborhood institutions a role to play tics at large. This new iteration of a kind in Spain. In the Nordic countries, manage- of voter torpor appears to be more a ment tasks are devolved upon infra-munici- response to high-level politics at national pal institutions with corresponding forms of level and perhaps the international lev- sector-based citizen participation. In other els, rather than a widespread unhappi- countries, neighborhood councils have been ness with local authorities. An exception set up, representing local residents; in may be found in Eastern Europe where France they are mandatory for cities with a local elections provoke dramatically population of more than 80,000, and are lower participation than national elec- optional for smaller municipalities. In Italy, tions, perhaps reflecting a general feeling neighborhood councils had some popularity that local authorities don't have much of in the 1970s, but have since declined. a role to play. Only three countries are bucking the trend: Hungary, Ireland and In fact, it has often been thanks to sector- Switzerland. The United Kingdom is also based procedures that progress has been seeing a rise in voter participation, albeit made in citizen participation, particularly from a very low benchmark. In Spain the in the fields of urban planning, environ- trend in voter participation simply is not mental protection and quality-of-life pro- clear enough to characterize. tection. Here local government has some- EUROPE Decentralization and Local Democracy in the World 159 times usefully turned to international the potential information technology has instruments and used them to raise public for improving administrative procedures. awareness and mobilize campaigns. This One factor inhibiting more computerization happened with the Aarhus Convention, of procedures is the need for increased and more recently with the environmental computer security to protect personal impact study plans and programs follow- data. In many cases this need for confi- ing the European Community Directive of dentiality prevents electronic production 2001. The real impact of these procedures and distribution of official notices and cer- on public participatory processes is diffi- tificates. With respect to local democracy, cult to assess. Particularly in light of the the Internet serves an educational function circumstances and situations where non- by multiplying the sources of information compliance of procedures leads to the that citizens can consult. Of course, it does With regard to annulment of the decisions already taken, not guarantee that relevant information administrative thus providing citizens with a more realis- will be made available to them for assess- tic appreciation of the room for participa- ing local management or policies. That controls,thereis tory maneuver and its subsequent bearing would require regulations governing what a general tendency on the decision-making process. information should be made available to citizens, as is the case in the United King- tolimittheseto Progress in the area of citizens' right to dom for performance indicators. legal checks on the information should not be forgotten either. This does not just concern the publication of Restrictions, active and passive, still exist lawfulness local public records. It also speaks to the in some countries on the voting rights of of actions right of access to administrative documents, part of the population. For example, which is an essential condition for trans- Latvia, Estonia and Lithuania restrict vot- and procedures, at parency in local government. Europe has ing by their Russian-speaking citizens. Sweden to thank for the widespread recog- Such voter exclusion is difficult to square least as far as the nition of this principle. Although it has not with the European Convention on Human own powers and been implemented in the systematic way Rights. Conversely, the Netherlands and seen in Sweden, improved access to local Sweden are extending voting rights to fo- responsibilities of government data does give citizens, associ- reign residents (non-European Union na- local authorities ations and the media a more complete pic- tionals), under certain conditions. ture of the workings of their administration. are concerned This is, of course, a prerequisite for effective IV.3. Supervision participation and supervision by civil society. Over the past few years, several Central and The supervision of local governments is Eastern European countries have passed usually exercised by the state, though in legislation to improve public access to federal states this is usually done by the administrative documents, most recently federal members and in self-governing and particularly the Czech Republic and Slo- regions supervision is at least partially de- vak Republic. The United Kingdom also volved to the regions. recently adopted such a law, The Freedom of Information Act. With regard to administrative controls, the- re is a general tendency to limit these to One related development is the advent of legal checks on the lawfulness of actions electronic administration in all the Euro- and procedures, at least as far as the own 19. Chatillon, G. / Du pean countries. This trend is not restricted (or basic) powers and responsibilities of Marais, B. (dir.) to local authorities, and has several local authorities are concerned. However, (2003), Electronic aspects19. The most important relates to one recourse is the "jurisdictionalization" of administration at the authorities' intention to simplify supervision. This trend is beneficial for local the service of administrative procedures. The de-mate- self-government. However, a closer consid- citizens, Bruxelles, rialization of the public markets illustrates eration does reveal that in most of the Bruylant. EUROPE 160 Decentralization and Local Democracy in the World states, the administrative authorities have niques based on the accountability of staff the power to first censure the act under and officials, and on performance evaluation dispute, after which the local authority may can translate into heavier controls. These submit the case to the courts. The admin- controls can be an even more sensitive issue istrative authority also has the power to given that the performance indicators and suspend any act it submits to the courts. objectives will have been defined in greater Few countries limit the power of the super- detail. When such controls are carried out by visory authority to the submission of cases a higher authority, they are by their nature to the courts. In France, Hungary and potentially harmful to local self-government, Spain, the act under dispute remains no matter that the official aim is to improve enforceable ­subject to a few exceptions. effectiveness. In Italy however, the 2001 constitutional review led to the total removal of the legal The case of the United Kingdom (England) is checks that had previously been carried out exemplary on this. Recent developments at the regional level, though not by the there have led to a reinforcement of the region. There remains a power of substitu- inspections carried out on local authorities, tion (stepping in for the lower authority) either directly through the audits effected by that the government can exercise in cases the Audit Commission for Local Authorities, where Italy's international and European which can submit cases to the courts, or Increasingly Community obligations in particular are at indirectly through procedures aimed at pro- worthy of note are stake. The government also has the possi- moting better public sector management bility of appointing an "extraordinary com- (Best Value Inspection, with the mission of the widespread missioner" to resolve a problem on behalf inspecting all services on this basis). If local forms of of a local authority that has proved unable authorities, bound by the Local Government to do so. This procedure has been used to Act 1999 to constantly improve their results, cooperation among resolve problems related to water supply improve their performance and obtain the various levels of and refuse disposal services in a few cities qualification of "best value authority," they in the south. are rewarded with a greater freedom of government based action, particularly in what use they can on contractual Regional authorities can also exercise cer- make of the grants they receive. The Best tain controls, as is the case for urban plan- Value Performance indicators are set by the arrangements ning and development in Italy and Spain, various ministries when these are preparing where they have the power of prior approval the annual budget. The Audit Commission of local council plans and can stipulate cer- (pursuant to the Audit Commission Act tain amendments as a condition for 1998) must publish to that purpose a report approval. on its evaluation of the performances of local authorities, and classify these accord- In some countries, the power of higher ing to their performances into different cat- authorities to dismiss or dissolve local bod- egories defined by the Secretary of State for ies is only very rarely regulated by the law, Communities and Local Government (pur- and could lead to abuses. Such cases are suant to the Local Government Act 2003, in steadily decreasing under the influence of particular sections 99 and 100). The October the Council of Europe and through monitor- 2006 White Paper provides for reducing the ing of the implementation of the European number of indicators used in the evaluations Charter of Local Self-Government. from 1,200 down to 200. Controls on financial management can affect Increasingly worthy of note are the wide- local self-government. While there has been spread forms of cooperation among various a tendency to decrease the traditional audits levels of government based on contractual for checking the lawfulness of accounts, the arrangements. Such agreements are used development of new management tech- under many different conditions for a va- EUROPE Decentralization and Local Democracy in the World 161 riety of purposes. These arrangements are There is also the phenomenon, well noted found in the various areas of shared po- for a long time now, by which the more wers and responsibilities, where coopera- national policies depend for their imple- tion creates interdependence. They are mentation on local authorities, the more used in Belgium, France, Germany, Italy, these are in a position to influence de facto the Netherlands, Portugal, and Poland (see the national policies. Or they may cause in particular the 1999 law on territorial distortions at the local level, forcing the development). They even appear in national government to anticipate things Ukraine (see the adoption in 2005 of the by, at least partly, taking into account the law on regional development and the adop- demands of the local authorities. This tion in 2006 of its implementing provi- phenomenon has often been studied, and sions). In England the regional offices of was illustrated a few years ago in France the government have since 2004 been by a report of the Cour des Comptes negotiating "Local Area Agreements" with (national audit office) on the "city con- the local authorities in order to implement tracts." The report showed how the con- some 40 programs set by ten ministries. tents of the contracts and their imple- There is also the The October 2006 White Paper provides mentation strayed from the priorities phenomenon, well for this to apply to all authorities, setting initially set out by the government (Cour out a legal framework for these agree- des Comptes, 1992). noted for a long ments that would make them mandatory time now, by which across the country. This approach has However, we should not extrapolate too raised considerable interest, which is much from this analysis, which only themorenational understandable because it sets an official applies to countries where the local policies depend framework for negotiations, and facilitates authorities, and in particular the mayors, the monitoring of how the mutual undertak- have acquired sufficient political weight to fortheir ings are honored. Developing cooperation reduce the scope of the methods of control implementation on between the various levels of government available to the government. In particular, represents a step beyond the notion of there are no indications that similar obser- local authorities, local self-government as something vations could be made about the local the more these are defined in opposition to the state. Instead, authorities of Eastern Europe, despite the it redefines it positively along the lines of a progress made there. in a position to general participation by local authorities in the different collective responsibilities that Connections between national and local po- influence de facto the public system must carry out. This litics should not be overlooked. An extreme the national highlights how relative the idea of local case of intermingling is France, where the self-government is in modern states. practice of politicians being elected to sev- policies eral mandates exists. This has allowed some IV.4. The Impact of Decentralization and local issues to permeate debates in the Local Democracy on National national parliament, but has also slowed Policies the renewal of the political scene by allow- ing elected officials to keep at least one It is paradoxical that apathy toward local mandate if defeated in election for another. institutions, as reflected in the increasingly This practice makes it difficult to introduce low voter participation in local elections, is global reforms that would challenge the manifesting itself at a time when the po- collective interests of local representatives. wers, tasks and independent decision-ma- The extensive reach of this system stands king of local authorities have markedly in- in contrast to the countries where radical creased in most countries. Again, evidence reforms have been carried out, such as the suggests that generally speaking this United Kingdom (particularly the reforms of development cannot be blamed on the 1972 and 1996). The British system is local institutions themselves. famous for the separation it maintains EUROPE 162 Decentralization and Local Democracy in the World between national and local institutions, and of the goals of local self-government build- between politicians of both levels. ing in Central and Eastern Europe was to establish associations of local govern- In the other countries, although multiple ments capable of representing their collec- mandates are usually excluded, at least at tive interests to central government. These the level of executive roles, the practice associations in the Western European nonetheless appears in several countries in countries provided crucial support for diluted or indirect forms. In Germany for their establishment. example, municipal or district councillors may also be elected as members of the The role of these associations in the Euro- regional parliaments (Landtag); the regional pean countries can be evaluated by their parliaments do in fact play an important role status and by the work they carry out. in local administration and finances. With respect to their status, legally they The growing influence of national political are always associations governed by pri- parties in local elections ­at least in coun- vate law. Even so, they are increasingly Local government tries with a system of political parties with being given official recognition, to a greater well-established local presence­ works or lesser degree. In most countries there is associations are both ways, but more in favor of centraliza- just one organization representing the local playing a greater tion. Political loyalties do lead to a certain councils, or respectively the intermediate homogeneity in the playing out of issues, level local governments. This is the situa- role in Europe, in even if local candidates for office try to put tion in Belgium, Denmark, Italy, the forward issues specific to their con- Netherlands, Spain and Sweden where, particular with stituency or area. This has long been since 2005, only one association has repre- respect to the EU. observed in the United Kingdom, espe- sented the local and county councils. In cially since the Labour party established Austria and Germany, certain differences Four main itself at the local level. But for the same between cities and municipalities are functions may be reasons, local elections are often consid- reflected in the two different associations ered as a test for the government in they have. Added to this is the association distinguished in power, which means that national issues representing the districts (Landkreis). Aus- their activities, tend to predominate over local ones. tria for its part is the only country where the role of the associations has been ensh- none of them being It is harder to assess the role local politics rined in the constitution: article 115.3 stip- exclusive play in the careers of politicians. Even in ulates that the Austrian Federation of Local France these days, national political Councils and the Austrian Federation of careers are more frequently consolidated Towns are bound to represent the interests by a local mandate, a likelier option than of the local councils. A few other constitu- getting into parliament after having tions enshrine the right of local councils to become known as a mayor. In the other form associations to represent their inter- countries, there are few examples of local ests (Bulgaria, Estonia and Hungary). In political leaders who went on to the France and Hungary there has been a def- national level. At most, this applies to the inite increase in associations forming along mayors of a few large cities. sectorial or partisan lines. IV.5. The Role of Local Government From the functional perspective, four cate- Associations gories of associations can be distinguished by what they do in practice. None of these It can safely be stated that local govern- activities is exclusive; on the contrary, ment associations are playing a greater most associations take over several jointly. role in Europe, even though their impor- However, the weight taken by one function tance varies from country to country. One compared with others allows distinctions EUROPE Decentralization and Local Democracy in the World 163 to be made among four categories of asso- it is these associations that sign the collec- ciations. The first is that of the associa- tive agreements legally required for fixing tions whose activities are essentially to the employment terms of local personnel. represent the collective interests of local This concerns the countries where the governments to the central government, employment of local government staff is or to the regional authorities. These are governed by private law, in particular Den- found particularly in Austria, Belgium, mark, Norway, Sweden, the United King- France, Germany, Greece, Italy and Spain, dom, and more recently, Italy. This does as well as most associations from the east- not mean that the other associations are ern countries. The second category is not interested in such matters; they just associations that have developed a role of do not have any legal responsibilities for representing the local authorities as the staff. Third, some associations have employers, and thus play a part in labour developed a role as agents for consultancy relations with the local government's staff; and other services to the local govern- EUROPE 164 Decentralization and Local Democracy in the World ments; these are often the same ones that associations of local and regional authori- appear in the second category, though ties of 35 European States. The mission of with the addition of associations in Austria, the CEMR is to promote a European Union Germany, the Netherlands, Ireland, Fin- founded on local self-government, and it land, and most of the Central and Eastern lobbies to be permitted input on European European countries. In the latter countries Community legislation and EU policies. It the associations receive support for this regularly publishes documents describing from their counterparts in the Western its position on EU initiatives or projects in European countries. The fourth category is progress, for example on the Commis- Today, the Council characterized by the difficulty of distin- sion's Green Paper on energy efficiency of European guishing the associations that represent (February 15, 2006), on the urban contri- specific interests from those that are legal bution to growth and jobs in the regions Municipalities and tools for facilitating cooperation between (March 10, 2006), on the proposal for a separate local councils in jointly carrying regulation of the European Parliament on Regions (CEMR) out shared work on specific tasks (Bul- public passenger transport services by rail is a garia, Estonia, Lithuania). This last cate- and by road (April 2, 2006), on the role of gory reflects some confusion, at the same local and regional governments in relation non-governmental time obscuring distinctions that absolutely to migration (October 23, 2006), and on umbrella must be clear if inter-municipal coopera- the directive proposal establishing a tion is to develop on a stable foundation. framework for the protection of soil (April organization for the 14, 2007). The CEMR is also the European national We can expect that the growing interde- branch of United Cities and Local Govern- pendence of different tiers of government ments. There are other European-level associations of ­financial as well as functional­ will lead local authority associations, in particular local and regional to the development of the role of local Eurocities, a network of 130 big European government associations in all the coun- cities in 30 countries that has existed since authorities of 35 tries. 1986, and whose aims and forms of action European States are similar, though more from the point of Moreover, local government associations view of the big cities. These organizations have been developing cooperation at the can find a support and a relay for their European level since the 1950s. Today, the proposals in the Committee of the Regions Council of European Municipalities and of the European Union, though this institu- Regions (CEMR) is a non-governmental tion is not their only channel for making umbrella organization for the national representations. EUROPE Decentralization and Local Democracy in the World 165 V. Conclusion This panoramic presentation of decentral- However, similarities can be observed at ization and local democracy in the European the level of values and tendencies, rather countries has shown how local self-govern- than between systems. The principles of ment has become the general rule, what- local self-government at present in Europe ever the diversity of institutions through form a corpus to which all states adhere. which it manifests itself. In this respect, One seeks to rationalize territorial divi- there are greater similarities between sions and their scale to make them ade- states at the local government level than at quate to their functions. Local government the regional level, which does not exist in all responsibilities can no longer be devised countries in institutional form and displays a with regard to a local public interest, but great variety where it does. more and more to their participation in EUROPE 166 Decentralization and Local Democracy in the World functions of overall national interest in a excepted, if under these terms are meant framework established by the law. The the resources of which local governments distance that existed formerly between are entitled to vary the yield, at least European countries, in broad terms within some limits. From the institutional between Northern and Southern Europe, point of view, the tendency to stronger is shrinking. This convergence can be political leadership and the development found also in the spreading of contractual of participation procedures can be relationships between government levels. observed everywhere. In sum, Eastern The role of local government has and Western Europe are becoming closer. increased considerably, from the economic point of view, in the performance of major The major ground for these convergences collective functions, as well as their auton- has to be found, without any doubt, in the omy in it. But own resources tend to growing integration and interdependence decrease, although some countries are between the various government levels, EUROPE Decentralization and Local Democracy in the World 167 whatever the differences in legal status. financing of local government budgets be This is the consequence of the extension of led by transfers and tax shares or by own local government functions and of correla- tax revenues. Local institutions further tive increase of their budgets. Local self- differentiate markedly between countries government is not the Asterix' village; this with traditions of representative demo- is a relative notion that has to be built cracy and countries with participative through a network of relations, resulting traditions. In Central and Eastern itself from the functions and powers Europe, and even more in South-East assigned by the law. Europe, the burden of the transition is still there; local government is indeed only By contrast, local government systems one piece in the state-building process. are not converging. They further differ- Nevertheless, differences do not impede entiate regarding the forms of regional- cooperation or exchanges of experience. ization and the role of the intermediate level of local government. Countries with Lastly, if decentralization contributes to large municipal units further contrast the development of political democracy, with countries with small municipal units. it would be an illusion to think that the The understanding of central-local rela- confidence crisis reflected in the lower tionships is still marked by historical fac- rates of participation in local elections tors, reflected in local government func- be solved by decentralizing more. Local tions. Only history can explain that in government is part of a whole. Local some countries a function is considered government may suffer a loss of sense local whereas in others it is considered as of politics at the national level that can- national. Local finance systems are not be ascribed to it. But it can demon- marked by the structure of national tax strate that it can contribute to give it systems; it derives from this that the sense again. LATIN AMERICA MARIO ROSALES SALVADOR VALENCIA CARMONA* LATIN AMERICA 170 Decentralization and Local Democracy in the World * In developing this study, the support, information and suggestions kindly provided by Edgardo Bilsky of CGLU, Iván Finot of CEPAL and Néstor Vega of FLACMA have been extremely important. The authors wish to acknowledge their contribution and express their gratitude. Nevertheless, the authors are entirely responsible for all statements and data. LATIN AMERICA Decentralization and Local Democracy in the World 171 I. Introduction verty line. The inequality has an unfavor- In Latin America, able impact on the advance of democracy the presidential Latin America is made up of a large group of and full exercise of citizenship (Human countries located in the territory extending Development Report, UNDP, 2005). regime is the most from Mexico's Río Bravo in the north to prevalent form Tierra del Fuego at the southernmost tip of The forms of states are diverse as would South America. Latin America for the pur- be expected in a vast area containing 100 of governance, poses of this report is divided into four sub- states or provinces in federal countries, with a clear regions: Mesoamerica, including Mexico and 250 regions or departments, and more the Central American nations of Belize, than 16,000 local governments --munici- predominance Costa Rica, Guatemala, Honduras, palities, districts or cantons-- across the Nicaragua, Panama and El Salvador; the subcontinent. Several countries, including of the national Antilles with Cuba and the Dominican Brazil, Mexico, Argentina and República executive over Republic1; South America, which comprises Bolivariana de Venezuela, have adopted a the Andean countries of Bolivia, Colombia, federal system with at least two levels of other state powers Ecuador, Peru, and República Bolivariana de sub-national government. The other Venezuela; and the Southern Cone, which countries have unitary state systems. encompasses Argentina, Brazil, Chile, Paraguay and Uruguay. In Latin America, the presidential regime is the most prevalent form of gover- An estimated 540 million people live in Latin nance, with a clear predominance of the America. Predominant cultures include national executive over other state po- those embodied by descendants of Native wers. From 1980 onward, the authorita- Americans, Spanish and Portuguese colo- rian regimes that dominated the area for nizers, African slaves and successive wa- generations have slowly given way to de- ves of European immigrants during the mocratic governments that foster popular past two centuries. It is the most urban- election of local authorities. ized of the developing regions. Although levels of urbanization vary between 93% A few Latin American countries did have in República Bolivariana de Venezuela and democratically elected local governments 42% in Haiti (see Table 1), an estimated before 1980, and now all of the nations 77.8% of all Latin Americans live in cities. have municipal governments elected by universal suffrage (see Table 2). The Latin American countries present very dif- majority of the countries are demo- ferent degrees of development. While the cratizing and reforming their states average regional GDP is $4,044 (CEPAL, through institutional, political and legal 2005), it is a continent with great inequal- transformations, of which decentraliza- ity in the distribution of wealth. Almost tion2 and strengthening of sub-national 40% of the population lives below the po- governments are part3. 1. The English-speaking countries (Antigua, Barbados, Granada, Jamaica, Saint Lucia, Trinidad and Tobago) are not included in this study. Nor is Puerto Rico or the overseas territories of France, the United Kingdom and the Netherlands. Only brief mention will be made of Haiti. 2. The notion of decentralization is broadly understood as the process of transfer of power and functions from the central state to the intermediate and local levels of government and administration. We make a distinction between political decentralization or devolution --with the transfer of responsibilities and resources in the framework of local autonomy-- and administrative decentralization or "deconcentration," which refers only to the transfer of functions and resources without autonomy. Both processes are accompanied by varying degrees of fiscal decentralization, i.e., the capacity to establish, collect and administer financial resources, to fulfill functions and provide services. Complex forms arise from the various combinations of these three processes. 3. Valadés, Diego and Serna, José María, 2000; Carbonell, Miguel 2004; Fix, Héctor and Valencia, Salvador, 2005. LATIN AMERICA 172 Decentralization and Local Democracy in the World Table 1 Development Indicators in Latin America Country Type of state GDP per GDP per inhabitant IHD ranking % population % urban inhabitant PPP 2006 * below poverty population in $ US in $ US line 2005 Argentina Federal 4.747 13.298 36 26.0 91,8 Bolivia Unitary 990 2.720 115 63,9 64,2 Brazil Federal 4.250 8.195 69 36,3 83,4 Chile Unitary 7.085 10.874 38 18,7 86,6 Colombia Unitary 2.663 7.256 70 46,8 76,6 Costa Rica Unitary 4.632 9.481 48 21,1 62,6 Cuba Unitary 2.797 ------ 50 --- 76,1 Ecuador Unitary 2.761 3.963 83 48,3 62,8 El Salvador Unitary 2.469 5.041 101 47,5 57,8 Guatemala Unitary 2.492 4.313 118 60,2 50,0 Haití Unitary 454 1.892 154 --- 41,8 Honduras Unitary 1.139 2.876 117 74,8 47,9 Mexico Federal 7.239 9.803 53 35,5 76,5 Nicaragua Unitary 896 3.634 112 69,3 56,9 Panama Unitary 4.797 7.278 58 33.0 65,8 Paraguay Unitary 1.201 4.813 91 60,5 58,4 Peru Unitary 2.841 5.678 82 51,1 72,6 Dominican Rep. Unitary 3.815 7.449 94 47,5 65,6 Uruguay Unitary 4.860 9.421 43 18,8 91,9 Venezuela, R. B. Federal 5.275 6.043 72 37,1 92,8 Latin America 4.471 39,8 77,8 Source: CEPAL, 2006; United Nations Development Report, 2006. * Index of Human Development: High is from 1 to 63; Medium is from 64 to 146; Low is from 147 to 177. LATIN AMERICA Decentralization and Local Democracy in the World 173 Nevertheless, the depth of the reforms II. Evolution of Local and their impact differ from one country Governments to another. Argentina, Brazil and Mexico --the three biggest nations in the re- Tension between centralization and decen- gion-- have chosen federalism; in the uni- tralization existed in the region long before tary countries, the role of the municipalities the emergence of the nation states. The has been expanded, and intermediate go- colonial era saw only the centralism of the vernments have been organized in the re- Spanish and Portuguese Crowns. Decen- gions and comparable departments. tralization first appeared during the wars for independence and in the time of the Argentina, Bolivia, Brazil, Chile, Colombia Cabildos Abiertos (People's Councils). and Ecuador have redistributed functions Struggles to preserve the colonial system and resources in favor of sub-national or to discard it have flared periodically governments.4 In Peru, the process of de- throughout the region ever since. centralization that began in the 1980s was reversed in the 1990s, and restarted During the 19th Century, wars and conflicts Duringthe19th after 2000. In República Bolivariana de took place in the nascent Latin American Century, wars and Venezuela, the decentralization of the nations setting federal tendencies against 1990s has, in recent years, been muddled unitary ones. Throughout the 20th Century, conflictstookplace by contradictory reforms that could affect many emerging nations opted for political in the nascent Latin the nature of local institutions. In and economic centralization, to the detri- Uruguay and Paraguay, decentralization is ment of the intermediate and municipal or- American nations still in the early stages. ganizations. After the Second World War, setting federal national planning and new policies to Mexico has moved forward with a "new replace imports coveted by the pro-de- tendencies against federalism," through the opening of the velopment sectors, reinforced centralizing political system and democratic alterna- tendencies. The tide of centralization began unitary ones tion. Legal and financial reforms favor sub- to change in the 1970s as a consequence of national governments; progress is slower successive economic and political crises. at the municipal level. II.1. Decentralization Cycles The Central American countries are evolving to a lesser extent. Guatemala and Nicaragua During the 1980s and 1990s, the demo- are passing decentralization laws. Honduras cratic transition saw state reforms and and El Salvador are increasing the amount decentralization. The centralist model of money transferred to the municipalities. was deemed outmoded and inefficient as Costa Rica and Panama are progressing a way to liberalize economies and reduce comparatively slowly: in Costa Rica, the po- state costs. It is customary to distinguish pular election of mayors was introduced only between two decentralizing cycles: one in 2002; in Panama, decentralization is more economic and neo-liberal, the other being raised to a constitutional level. with greater emphasis on social and de- 4. The concept of mocratic aspects5. sub-national For the past ten years, decentralization in the governments refers both to state or Dominican Republic has been on the public The first decentralizing cycle developed from intermediate agenda, and there has been a gradual the 1980s in a context of debt crisis and governments and increase of municipal resources as well as high inflation. One of its avowed goals was municipalities, also enactment of new legislation favoring the to reduce the size of the central administra- known as local municipal regime. Cuba remains centralized, tion in order to eliminate the fiscal deficit governments. and Haiti, though still facing severe problems and drive the market. The economies made 5. Finot, Ivan, 2001 at all levels of government, recently held its strong structural adjustments, delivery of and Wiesner, first local elections in several years. services was transferred to the sub-national Eduardo 2003. LATIN AMERICA 174 Decentralization and Local Democracy in the World governments or privatized by passing such as Argentina, Bolivia, Brazil, Ecuador, responsibility to privately held or state com- Mexico, Peru and República Bolivariana de panies. Results were mixed at best. Venezuela. It involved strategies to correct the Although this first policy cycle did not pro- neo-liberal paradigm with more democratic duce the hoped-for results, it did cause seri- and social policies. The decentralization move- ous social, economic and political problems. ment was stimulated by the progress of muni- cipal management of the region.6 Theseconddecentralizationcycletookplaceat theendofthe1990s,inthemidstofthefinan- Predictably, these great cycles translate cial and social crises that affected countries differently in each sub-region of Latin Figure 1 1980-2005: Evolution of Decentralization in Latin America7 Percentage of the Expenditure of Sub-national Governments in Total Governmental Expenditure 6. New paradigms for Brazil 2002 42.1 local government management come Brazil 1980 32.4 Argentina 2004 41.6 to light, as in the cases of Curitiba or Colombia 1982 26.3 Mexico 2000 31.9 Porto Alegre, in Brazil; Villa El Argentina 1980 22.2 Colombia 2005 29.8 Salvador, in Peru; Mexico 1980 22.0 Bolivia 2005 29.5 Bogota, in Colombia; Cotacachi and Ecuador 1980 18.3 Peru 2005 26.8 Guayaquil, in Ecuador; Santiago Bolivia 1986 14.8 Ecuador 2004 22.1 de Chile; Mérida, San Pedro Garza García Latin American average 11.6 Latin American average 18.8 or San Nicolás de los Garza, in México; Peru 1990 9.1 Chile 2005 15.0 Rafaela in Argentina; or La Paz in Bolivia, Uruguay 1980 8.6 Uruguay 2005 13.2 among many others. 7. Sub-national El Salvador 19 78 5.8 Guatemala 1997 13.0 expenditures used as indicators for Paraguay 1980 5.5 El Salvador 2005 8.7 decentralization are Guatemala 1980 4.5 Paraguay 2005 7.0 limited in nature, given that they Costa Rica 1980 4.0 Dominican Rep 2004 7.0 usually aggregate municipal and Chile 1980 3.7 Costa Rica 2005 6.0 federal level expenditures. For Dominican Rep. 1980 3.5 Nicaragua 2002 3.8 example, a higher level of expenditure Nicaragua 1988 3.4 Panama 2002 3.8 in the provinces in Argentina does not Panama 1980 2.0 represent more municipal Source: UCLG Country Profiles (2007), National Files. expenditure. Drawn up by: Mero. LATIN AMERICA Decentralization and Local Democracy in the World 175 America (see figure 1). The federal coun- In Argentina, there was an historical and Brazilisoneofthe tries mainly strengthened the intermediate troubled relationship between the federal most decentralized levels of government and, after these, the government and the provinces. The Con- municipalities. stitution of 1853 attempted to regulate countries in the this relationship by transferring support for region. It is based Brazil is one of the most decentralized the municipal government to the countries in the region8. It is based on a fe- provinces. After the military governments on a federal deral tradition that goes back to the birth of (1976-1983), the already centralized divi- tradition that goes the republic at the end of the 19th century. sion of powers and resources was The main attempts to reduce federalism to reviewed. In the ensuing decade, the back to the birth the advantage of the central state occurred national government and the provinces under the presidency of Getúlio Vargas redefined the rules of financing through of the republic (1937-1945) and during the military go- co-participation which increased transfers at the end of the vernments (1964-1985). With the end of in exchange for a decrease in local tax rev- this last authoritarian period, decentraliza- enues and the privatization of services. 19th century tion was pushed forward in order to resolve The constitutional reform of 1994 took up the state crisis. Thus, the 1988 Constitu- essential aspects of fiscal co-participation tion defined Brazil as an "indissoluble union between the central government and the of states and municipalities and the federal provinces. Thus, municipal autonomy was district." Autonomies were strengthened recognized and the city of Buenos Aires, and local responsibilities and powers were capital of the country, was granted an increased. The municipalities received fe- autonomous local government. However, it deral entity status and were granted full was still within the provinces' power to autonomy by the Federal Constitution. In define the municipal regime, allowing 1993, hyper-inflation and state indebted- great diversity among them.9 ness pushed the national government to fiscal recentralization, and to reorganizing Mexico, throughout the 20th Century, lived and privatizing the states' banks and pub- through a process of expansion and lic services. In 2003, the government of enlargement at the central level, in accord Luiz Inácio Lula da Silva promoted greater with provisions of the 1917 Constitution. dialog and coordination between the fed- The national government absorbed local eral level and the municipalities responsibilities and their sources of through the Secretariat for Federal Mat- income, to the detriment of the sub- ters. The Ministry for Cities was also cre- national governments. As recently as 1977, 8. With over 40% of ated to establish a national urban devel- 1983 and 1999, constitutional reforms public expenditure opment policy that would guarantee the favored municipalities, particularly in order delegated to states "right to the city," relying on the munici- to introduce party pluralism into the coun- and municipalities, palities to carry out policies to redistribute cils, and to strengthen the treasury and Brazil has the most income and social programmes like "Zero local public services. During the 1990s, the equitable distribution Hunger." In March 2003, during the VI national government undertook policies to of resources between March in Defence of the Municipalities, the favor sub-national bodies through a "new the two levels of the federal government and municipal entities federalism." In turn, pluralism and political state in the region. signed a protocol for the creation of the alternation facilitated local reactivation. In 9. Many provinces usually restrict the Committee of Federal Articulation --CAF. 1994, the statute of the Government of the local autonomy of This committee became the main instru- Federal District of Mexico City was small municipalities. ment for negotiations between the Federal approved, and three years later its Head of For example, in the Union and the municipalities, helping to Government was elected by popular vote. province of Santiago further advance municipal interests in Mexican municipalities were organized by del Estero only five Brazil in matters such as teacher salaries, the states, but continued to depend on the out of 126 school transport, and fiscal and pension national government. However, innovative municipalities enjoy reform. changes were taking place in many munic- full autonomy. LATIN AMERICA 176 Decentralization and Local Democracy in the World ipalities, which were demonstrating mod- Decentralization in the Andean countries ernization in local management. has taken place through far-reaching con- stitutional and legislative reforms, in a rel- Although República Bolivariana de Venezuela atively brief time. officially has a federal system, it is a strongly centralized country, heightened by the model In Colombia, after the extreme centraliza- of sustained development in financing tion of the 1960s and 1970s, and the politi- public expenditure through the distribution cal crisis expressed in the civil strikes of the of oil income. In 1989, the Ley Orgánica de 1970s and early 1980s, a clear decentraliz- Descentralización, Delimitación y Transfer- ing process began in the middle of the encias del Poder Público (Decentralization, 1990s. The 1991 Constitution laid the bases Delimitation and Transfers of Public Power for a unitary and decentralized territorial Act) drove the decentralization process, of government, with autonomy of the territo- which the first achievement was the rial bodies: departments, municipalities and direct election of mayors and governors. districts. Moreover, indigenous territories, The process ground to a halt in the second regions and provinces were created to half of the decade. In 1999 the Bolivarian regroup bordering departments and mu- Decentralization Constitution seemed to re-launch the nicipalities. Direct election of mayors process, but subordinated municipal (1986) and of departmental governors in the Andean autonomy to the Ley Orgánica del Poder was thus established by 1992. Throughout countries has Público Municipal (Organic Law of Munici- the 1990s, abundant legislation was pal Public Power) and its fiscal responsibil- passed regulating different aspects of taken place ities to a Ley Nacional (National Law) in local management, such as the mecha- through 2005. The tension between centralism and nisms of transfer and participation, dis- local autonomy increased with the Ley de tribution of responsibilities and territorial far-reaching los Consejos Comunales (Community organization. By the end of the 1990s, prob- constitutional Councils Act of 2006), which set up a net- lems of indebtedness and the economic cri- work of local organizations directly con- sis made it necessary to review the transfer and legislative nected to the presidency in order to chan- system and impose a regime of austerity on reforms, nel local financing. At the start of 2007, sub-national government spending, along the Ley de Habilitación Legislativa (Enabling with a redistribution of competences. in a relatively Act) was passed, authorizing the national government to regulate the provincial Bolivia implemented an original decentral- brief time states and municipalities. izing process that recognized its multi-eth- nic and multicultural character by streng- In the unitary countries, the debate thening two levels of sub-national about decentralization focused on the re- government: the municipalities and the lationship between the national govern- departments. After many election-free de- ment and the municipalities. The process cades, in 1987 municipal elections were advanced more slowly at the intermedi- held. In 1994, the Ley de Participación Po- ate level which, in fact, worked in tan- pular (Popular Participation Act) was dem with the national level. In the passed, strengthening the municipalities majority of South American and Central politically and financially and strongly pro- American countries, intermediate admin- moting the participation of grassroots istrations depend on the central power communities. In 1995, the Ley de Descen- and are the responsibility of an official tralización Administrativa (Administrative appointed by the latter. Despite this, Decentralization Act) benefited the depart- there is a growing tendency toward the ments at the intermediate level, granting popular election of intermediate authori- them elected assemblies. In 1999, the new ties, as already occurs in Colombia, Peru, Ley de Municipalidades (Municipalities Act) Ecuador, Bolivia and Paraguay. was passed. The departmental prefect was LATIN AMERICA Decentralization and Local Democracy in the World 177 initially appointed by the national govern- Ley de Descentralización Fiscal (Fiscal De- ment, but in 2006 he was elected by popu- centralization Act) and the Ley Marco de lar vote. In that year, after a prolonged Presupuestos Participativos (Framework social and political crisis, Evo Morales' go- for Participatory Budgets Act). In Novem- vernment took power and convoked a new ber 2006, regional governors were elected Constituent Assembly, in which questions for the first time by popular vote. Peru now pertaining to the regions, municipalities and has several levels of government: indigenous communities took priority. The national, regional, as well as distinct levels richest departments, in particular those in for both provincial municipalities (cities) the east, demanded greater autonomy. and district municipalities. In Ecuador, mired in a deep political and social The unitary states of the Southern Cone crisis that led to the fall of various presidents ­Chile, Uruguay and Paraguay­ have also andthedollarizationoftheeconomy,the1998 carried out reforms shaped by their Constitution ratified the decentralization, de- respective characteristics. concentration and participation prescribed by previous laws. La Ley de Juntas Parroquiales Chile has been a centralized country since (Parish Councils Act) of year 2000, the De- the middle of the 19th Century. However, in centralization Plan and the regulation of the 1891 following a brief civil war, the Ley de The unitary states Ley de Descentralización y Participación Social la Comuna Autónoma (Autonomous Com- de 1997 (Decentralization and Social Partici- munity Act) was passed, and it was very of the Southern pation Act of 1997) in 2001, as well as the advanced for the time. Nevertheless, the Cone ­Chile, reforms to the Ley del Régimen Municipal ruling did not work and the Constitution of (Municipal Government Act) of 2004 further 1925 recentralized the country. During the Uruguay and mandated improvements in services and the 1980s, the military regime applied an obligation to transfer responsibilities. Two administrative decentralization that handed Paraguay­ have main levels of autonomous government were over to the municipalities the administra- also carried out recognized: provinces and cantons (munici- tion of primary health care, primary and palities). However, the provincial level was secondary education, and the management reforms shaped by limited by its scanty responsibilities and of social funds. With the return of democ- their respective resources, and by the coexistence of two racy in 1990, the country moved toward a authorities: a popularly elected Prefect and a more political decentralization with the characteristics governor appointed by the central go- direct election of mayors and town council- vernment.Insmallmunicipalities,mayorsand lors in 1992. In 1993, 13 regional govern- council presidents had been elected since ments were created, although intendentes 1935; since 1988 all mayors have been dem- (mayors) were appointed by the national ocratically elected. government. In later years, new responsi- bilities, tasks and resources were allocated In Peru, the Constitutional Reform of to the municipalities by reforms to the Ley March 2002 placed emphasis on the cre- Orgánica Municipal (Organic Municipal Law) ation of regional governments, effectively of 1999-2000. restarting decentralization plans that had been blocked under the authoritarian gov- In Uruguay, local government is identified ernment of Alberto Fujimori. That same at the departmental level, which includes year the Ley de Bases de la Descentral- various centers of population, and pos- ización (Bases for Decentralization Act) sesses an extension and population far was passed, followed in the period from above the average for Latin American 2002 to 2005 by various rulings, including municipalities (table 2). After the return to the Ley de Gobiernos Regionales (Regional democracy in 1985, the constitutional Governments Act), a new Ley Orgánica de reform of 1996 for the first time confirmed Municipalidades (Municipalities Act), the the obligation of the state to formulate LATIN AMERICA 178 Decentralization and Local Democracy in the World decentralizing policies in order to "promote 1999-2004. A law was passed in 1998 to regional development and social well increase financial transfers to the municipali- being." It was set down that departmental ties (revised in 2005), and recent reforms elections should be held on a different date have been made to the Municipal Code from the national elections. Now the ten- (2005). A new General Decentralization Act is dency is to dissociate the local level ­Jun- nowindiscussionintheParliamentandaCivil tas locales (Local Councils)­ from the de- Service law was approved. partmental, although no legislation has been passed to this effect. The 19 depart- In Guatemala, the Ley General de mental intendentes (chief executives) have Descentralización (General Decentraliza- been directly elected since 196610. tion Act) was enacted through Decree 14- 2002. In 2002, the new Municipal Code In Paraguay, after 35 years of dictatorship and Ley de Consejos de Desarrollo (1954-1989), the first elections for munici- Urbano y Rural (Councils for Urban and pal intendentes were held in 1991, and the Rural Development Act) also came into first elections of departmental governors force in 2002; the Ley del Catastro (Land and councils in 1992. The constitution of Registry Act) (2005) was enacted; the 1992 recognized the political autonomy of Política Nacional de Descentralización del municipalities in handling their affairs, col- Organismo Ejecutivo (National Policy of lecting taxes and managing their expendi- Decentralization of the Executive Organ- ture. The autonomy of the departments ism) was passed in 2005. was far more limited. In 2000, the National Council for Decentralization of the State In Honduras, the National Plan for Decen- was set up. However, despite the new con- tralization and Municipal Development was stitutional framework for democratization, passed in 1994, the Executive Commission the municipal code has not yet been for Decentralization was established and reformed, and national officials in concert the Plan of Action 1995-1998 was drawn with the legislature continue to exercise up, though it was not put into effect. The strong control over the municipalities. topic was taken up again in 2000 and linked to the eradication of poverty. In The Central American countries have 2003, a new Ley de Ordenamiento Territo- passed decentralizing laws, and their main rial (Decentralized Spatial Planning Act) challenge now is to implement them. Above was issued. Then in 2004 the Ley de all, they need to broaden the scant finan- Descentralización del Servicio de Agua cial capability of the municipalities. (Decentralization of the Water Service Act) 10. The term was issued. Other reforms to the Ley de intendente was In Costa Rica, the reform of the Municipal Municipalidades (Municipalities Act) are coined during the Code (1998) allowed direct election of ma- underway. colonial reforms of yors for the first time in 2002. It also the 17th Century. approved, through the constitutional reform In Nicaragua, the constitutional reforms of Such officials of 2001, a gradual increase in responsi- the beginning of the 1990s strengthened displaced the bilities and transfers to the municipalities, the power and self-financing of the munic- greater mayors. In rising to 10% of the national budget. How- ipalities, and reaffirmed the autonomy of Uruguay the ever, strong resistance has arisen and there the two regions created in 1987 along intendentes are in is not yet any legislation to achieve its Nicaragua's Atlantic Coast. In 2003, a charge of the implementation. decentralization policy was defined as the departments, crux of the Estrategia Reforzada de Com- assisted by a council of El Salvador made a concerted effort to draw bate y Eradicación de la Pobreza (ERCERP) aldermen, to the up its National Strategy for Local Develop- (Reinforced Strategy to Combat and Erad- detriment of local ment, with strategic guidelines for decentral- icate Poverty). Between 2002 and 2004, bodies. ization to be implemented during the period the Ley de Régimen de Presupuesto Mu- LATIN AMERICA Decentralization and Local Democracy in the World 179 nicipal (Municipal Budget Regime Act), the or departments --some, such as São Paulo Ley de Participación Ciudadana (Civic Par- and Buenos Aires, possess populations and ticipation Act) and the Leyes de Transfer- productive capacities surpassing those of encias Financieras y de Solvencia Fiscal many nations; many others are small and Municipal (Financial Transfers and Munici- have quite limited resources. pal Fiscal Solvency Acts) were passed. Nearly 90% of the 16,000 Latin American In Panama, decentralization of the state municipalities have fewer than 50,000 in- was included in the constitution through the habitants. Some administer broad terri- constitutional reform of 2004 and a new tories, some are meager in size. The ma- legal framework was developed for jority have to deal with considerable provinces, town councils and corregimien- financial difficulties, and restrictions on tos (mayoral jurisdictions)11. human technical resources. In the Spanish-speaking Caribbean, Where local autonomy is a goal, legislation authorities at the provincial level in the in many countries sets minimum require- Dominican Republic are appointed by the ments for a municipality: population and central government. The town council is territory of reasonable size, and sufficient the only elected level of local government. economic, social and political capacities to Among recent reforms, mention should be ensure adequate institutional consistency. made of the division of the National District As a practical matter, many municipalities into various municipalities in 2001, and the are nevertheless established without these law of 2003 that made it possible to minimum requirements, giving rise to increase transfers to the municipalities. what is often referred to as municipal The convocation of a Constituent Assembly fragmentation. Such inconsistencies often in 2007 is being contemplated; among its generate problems in the delivery of prerogatives would be the deepening of the municipal services and in coordination decentralization process. The new Law of between the intermediate and national go- the Participatory Budget has been enacted vernmental authorities. and a Municipal Bill is under debate. Sometimes called the "atomization" of mu- 11. The corregimientos are elected sub- In Cuba, the Constitution in force since the nicipalities, fragmentation is to some municipal entities. mid 1970s recognizes the legal status of degree endemic throughout Latin America. In effect, the 14 provinces and 169 municipalities. They Consider: In Brazil, out of a total of 5,562 Panamanian are administered as representative institu- municipalities, 1,485 were created Constitution tions whose leaders are elected in the Pop- between 1990 and 2001. This gave rise to decrees that there ular Power Assemblies with their own elec- a constitutional amendment ­the 15/96­ must be a municipal toral division. These are governed to specify the requisites for creating council in every according to the principles of "socialist municipal corporations. Mexico now has district, and this democracy," have very limited autonomy, 2,438 municipalities, and it may cause lit- council must and generally defer to higher levels of gov- tle surprise that in many of its states include ernment. municipal fragmentation is the norm12. representatives of the corregimiento who have been Fragmentation has also been observed in elected in this II.2. Municipalities, Cities some unitary countries, especially those electoral division. and Metropolitan Areas with numerous municipalities. Colombia, 12. In Oaxaca there are for example has 1,099 municipalities, Peru 570 municipalities; The sub-national administrations and go- more than 2,000 provincial and district 217 in Puebla; 212 vernments of Latin America are extremely municipalities. In Bolivia, the 1994 Law of in Veracruz and 124 heterogeneous. Among the intermediate Popular Participation created 198 new mu- in the State of levels of government --states, provinces nicipalities, bringing the total to 327. Mexico. LATIN AMERICA 180 Decentralization and Local Democracy in the World Table 2 Number of Sub-National Governments and Population Population Federal countries Unitary countries Democratic Country (milions) Average States Municipalities Departments Municipalities municipal population per elections following municipality authoritarian rule Brazil 190.127 34.183 26 5.562 1986 Mexico 107.537 44.091 32 2.439 1977 Colombia 47.078 42.837 32 1.099 1986 Argentina 38.971 17.531 23 2.223 1983 Peru 28.349 13.695 25 2.070 1981 Venezuela, R. B. 27.031 80.690 24 335 1992 Chile 16.436 47.641 15 345 1992 Ecuador 13.408 61.224 22 219 1935 Guatemala 13.018 39.211 22 332 1986 Cuba 11.400 67.456 14 169 ---- Bolivia 9.627 29.440 9 327 1987 Dominican Rep. 9.240 60.789 32 152 1978 Honduras 7.518 25.228 18 298 1982 El Salvador 6.991 26.683 14 262 1984 Paraguay 6.365 27.554 17 231 1991 Nicaragua 5.594 36.803 15 + 2 regional 152 1990 autonomies Costa Rica 4.399 54.309 7 81 1948 Panama 3.284 43.787 9 75 1996 Uruguay 3.478 183.053 19 1985 Total 549.851 33.548 105 10.559 251 5.831 Sources: CEPAL 2005. UCLG Country Profiles (2007). Drawn up by authors. More than half of the population of Latin excess of 5 million; the 3 million mark has America dwells in cities with more than a been surpassed in Brazil by Belo Horizonte, million inhabitants. No fewer than 50 Latin Salvador de Bahía, Fortaleza, Porto Alegre American cities have populations of a mil- and Recife; Caracas in República Bolivariana lion or more; of these, four rank among the de Venezuela, Santo Domingo in the ten largest cities on earth: São Paulo (17.8 Dominican Republic, and Monterrey and million), Mexico City (16.7 million), Buenos Guadalajara in Mexico also have passed this Aires (12.6 million) and Rio de Janeiro (10.6 population milestone. Many more cities in million). Three other cities, Bogotá, Lima Latin America are of intermediate size and Santiago de Chile, have populations in ­between 100,000 and one million inhabi- LATIN AMERICA Decentralization and Local Democracy in the World 181 tants­ and generate significant demo- created a Metropolitan Consortium, which graphic and economic dynamism. encompasses the municipal councils of the departments of Canelones, Montevideo and The great size of most big cities in Latin San José, with, altogether, 2,000,000 inha- America and the Caribbean means that bitants. In most metropolitan areas only they typically encompass many municipal mechanisms for sectoral coordination of li- territories and, in some cases, an entire mited scope are in operation15. state or province. Mexico City and its Met- While various Latin ropolitan Area, as defined in 1995, In Central America, some coordinating envelops more than 41 municipalities in institutions also function: the Corpora- Americancapital two states, as well as the Federal District. tion of the Metropolitan Area of San Sal- cities have special Buenos Aires covers the territory of the vador (COAMSS) and in Costa Rica the autonomous City of Buenos Aires plus that Metropolitan Federation of Municipalities regimes, such as of 32 municipalities in the province of of San José (FEMETROM) whose aims are Bogotá, Buenos Buenos Aires; Gran Santiago (Greater limited to spatial planning and land use- Santiago, Chile) takes in 52 municipalities, management. Aires, Caracas, and São Paulo in Brazil has 39 prefeituras (prefectures). Lima, Mexico City Given the level of urban and territorial complexity, various countries are trying and Quito, few have Territorial administration and management policies to realign land use. Others, such of the big cities poses a major problem. as Argentina, Bolivia, Brazil, Colombia, a metropolitan While various Latin American capital cities Ecuador and a few other Central American government that have special regimes, such as Bogotá, countries, are promoting the creation of Buenos Aires, Caracas, Lima, Mexico City mancomunidades (associated municipali- allows them to and Quito, few have a metropolitan gov- ties) and other associative forms to help manage the urban ernment that allows them to manage the solve the problem of the small size of urban territory in an integrated manner. many municipalities, which is limiting their territoryinan Among this latter type are the Metropolitan capacity to respond effectively to the integrated manner Municipality of Lima13, with a special demands of their communities and citi- regime that grants it the faculties and func- zens. tions of Regional Government within the jurisdiction of the Province of Lima; the More than 70 municipal mancomunidades Metropolitan District of Quito, created by have been set up to develop and provide law in 1993, and the Metropolitan District services in Bolivia. In Argentina, there of Caracas, created in 200014. In Montev- are 72 inter-municipal bodies which ideo, the national government has recently group 770 local governments of 22 13. The Metropolitan Region of Lima is created by Artícle 33 of Law Nº 27783, on Bases for Decentralization. Artícle 65 and following of Organic Law Nº 27867, on Regional Governments (modified by Law Nº 27902). Article 151 of Organic Law Nº 27972, on Municipality. The Mayor of Metropolitan Lima carries out the functions of Regional President, as executive organ; the Metropolitan Council of Lima, exercises functions of Regional Council, as normative organ and inspector; the Metropolitan Assembly of Lima, made up of the metropolitan mayor, the district mayors and representatives of civil society and base organizations of the province of Lima, exercises competencies and functions of the Council of Regional Coordination, as consultative and coordinating organ. 14. Quito has a relatively decentralized configuration, endowed with a council and a metropolitan mayor with responsibility over most of the territory. Caracas has a system of municipal government on two levels with a metropolitan mayor and a legislatively elected council, covering the zones of Libertador (the federal district of Caracas has been eliminated) and the muncipalities of the neighboring state of Miranda. 15. See the Comité Ejecutor del Plan de Gestión Ambiental y Manejo de la Cuenca Hídrica Matanza-Riachuelo (Committee to carry out the Plan for Environmental Management and Handling of the Matanza-Riachuelo River Basin) in Buenos Aires. Or else partial and incipient experiments in inter-institutional cooperation, such as the ABC Chamber of São Paulo (with Santo André, São Bernardo and São Cayetano). LATIN AMERICA 182 Decentralization and Local Democracy in the World Argentinian provinces, aimed mainly at countries, the states and provinces take the promotion of micro-regional eco- up the largest share of expenditure, nomic development, tourism develop- while local government expenditure is ment and the preservation of the envi- lower than 20% in Brazil and less than ronment. In Ecuador, there are more 10% in Argentina and Mexico17. than 20 mancomunidades, bringing together more than 100 municipalities16, · A second group of nations ­with an inter- with a similar number of associative mediate degree of centralization­ with arrangements between provincial, sub-national public spending between regional and micro-regional entities to 10% and 20% includes República Bolivar- promote development. There are more iana de Venezuela, Chile, Uruguay and than 60 regional, sub-regional and sec- Guatemala. toral local government associations oper- ating in Chile; and in Colombia there are · A third group of countries has only incip- over 44 local government associations ient decentralization, with public expen- representing 454 municipalities that diture less than 10%. These are Costa work jointly for the provision of public Rica, the Dominican Republic, Nicaragua, services, public works and/or carry out Panama, Paraguay and El Salvador. administrative functions that are dele- gated to the municipal associations. All the same, the indicator for municipal expenditure shows (Table 3: column 3) III. Finances, Responsibilities that only three countries exceed 15% of and Management Capacities general government expenditure: Ecuador, Colombia and Brazil. They are III.1. Progress in Decentralization followed by Chile, Guatemala and and Financing Capabilities Uruguay at 13% (in Uruguay, the Depart- ments, given their size, are closer to the The progress in financing sub-national go- intermediate rather than municipal vernments may be seen as a whole in Table 3, level). Next come Argentina, Bolivia, though the figures used --based on data from Peru and El Salvador with between 7% the IMF and World Bank, national accounts and 9% of general government ex- and others-- are not always homogeneous penditure. The remaining countries range 16. Example in and must be considered with caution. Never- between 3.8% and 7% of this indicator. Ecuador: the theless, the positive impact which decentral- Mancomunidad of ization has had on all of the countries is obvi- Brazil stands out in the first group of coun- Municipalities for the Rehabilitation of ous. The simple average decentralized tries mentioned above; not only is it the the Ecuadorian expenditure in Latin America went up from country with the greatest degree of fiscal Railway, created 11.6%oftotalgovernmentalspendingaround decentralization, but it is also the country through an 1980, to 18.8% between 2002 and 2005. that demonstrates the greatest balance in agreement signed expenditure (vertical equity) between the in June 2005 by 33 Drawing from the information for aggre- three levels of the state. municipalities. gated expenditure in the table below (see 17. One criticism of this column 2 in Table 3), the following classifi- Argentina, Brazil and Colombia have had classification is that cation can be made: to overcome critical processes arising out in federal countries of the excessive indebtedness of their the index for sub- · The first group of countries with sub- sub-national and central governments. national national public expenditure greater than This has made it necessary to make expenditures usually conceals the 20% includes federal countries severe adjustments, especially in Colom- level of ­Argentina, Brazil and Mexico­ and the bia. Even so, in Colombia the fiscal bal- centralization by unitary countries, Colombia, Peru, ances in territorial governments have state agencies. Bolivia and Ecuador. However, in federal shown important improvements. At the LATIN AMERICA Decentralization and Local Democracy in the World 183 Table 3 Evolution and Distribution of Expenditure by National, Intermediate and Local Governments in Latin America Countries 1. Non-financial 2. Evolution of Distribution of total governmental expenditure between national government, public expenditure by intermediate governments, and local governments, 2002-2005 expenditure sub-national ( % GDP) governments 3. Local 4. Intermediate 5. National 6. General (% expenditure government government government government of central government) Argentina 25.2 41.6 7.8 33.0 59.1 100.0 Bolivia 30.0 29.5 8.5 21.0 70.5 100.0 Brazil 24.6 (CG) 42.1 16.6 25.5 57.8 100.0 Chile 34.2 15.0 13.2 1.8 85.0 100.0 Colombia 35.2 29.8 17.0 12.8 70.2 100.0 Costa Rica 25.5 6.0 6.0 ---- 94.0 100.0 Dominican Rep. 19.3 (CG) 7.0 7.0 ---- 93.0 100.0 Ecuador 24.5 22.1 17.2 4.9 77.8 100.0 El Salvador 17.5 8.7 8.7 ---- 91.3 100.0 Guatemala 11.7 (CG) 13.0 13.0 ---- 87.0 100.0 Honduras 34.1 5.6 5.6 ---- 94.4 100.0 Mexico 23.3 31.9 4.3 27.5 68.1 100.0 Nicaragua 30.3 3.8 3.8 ---- 96.2 100.0 Panama 24.8 3.8 3.8 ---- 96.2 100.0 Paraguay 33.3 7.0 5.2 1.8 93.0 100.0 Peru 19.2 (GG) 26.8 8.5 18.3 73.2 100.0 Uruguay 29.6 13.2 13.2 ---- 86.8 100.0 Venezuela, R. B. 32.2 ---- ---- ---- ---- ---- Sources: IMF Finance Yearbook 2002 to 2006; World Bank; Central Bank of Colombia; General Audit Office of Chile; "Descentralización Fiscal en C. América", G. Espitia. CONFEDELCA, GTZ, 2004. "Descentralización en Ecuador", CONAM; Ministry of Economy of Ecuador; State Bank of Ecuador, 2006. Country Profiles. GC = Gobierno Central. GG = General Government. Drawn up by: MERO. end of 2004, the sector of regions and budget, and because frequently their self- local governments presented a high sur- administered revenue is not significant. plus of 1.1%, and repeated that mark in In general, in these countries progress 2005 and 2006. toward decentralization is subject to the rhythm of the municipalities or local gov- In the unitary states, the weight of the ernments. intermediate bodies is less. This is the case because they usually depend wholly Overall, the nations that have carried out or in part on the central government more decisive decentralizing processes have LATIN AMERICA 184 Decentralization and Local Democracy in the World In the unitary visibly improved the situation of infrastruc- vehicles (64%, 14.5%, 7% and 6%, ture, services and degrees of participation in respectively, in 2004). countries that have the poorer, more remote and rural areas. intermediate Bolivia provides a notable example: there · Brazilhasallowedthestatestoreceivethe has been a substantial increase in the sales tax (Circulation of Goods and Serv- entities, only a few resources which reach the outlying territo- ices Tax - ICMS), which represents 26% of types of tax revenue ries, as well as in the degree of organization the national revenue. and participation of rural communities. are allocated to the · In Mexico, some states receive taxes on middle level In the countries with a medium degree of personal income and from the acquisition decentralization there are contradictory of used cars. Since 2005, local taxes on situations, as in Chile. While there are professional services, transfers, and tem- notable advances in the democratization of porary usufruct of property or business the municipalities, the intermediate level activities have been permitted. continues to depend to a great extent on the central government. Curiously, Chilean · República Bolivariana de Venezuela grants legislation uses the term "regional govern- to the states only the tax revenue from ments" to refer to the de-concentrated stamps and salt mines. intermediate level, and the expression "lo- cal administration" to refer to the munici- Intheunitarycountriesthathaveintermediate palities, even if they possess autonomy entities, only a few types of tax revenue are and their own resources, and deliver a allocated to the middle level. For example, in wide range of services. Colombia intermediate entities receive rev- enue from the sale of alcoholic beverages, III.2. Income and Taxation Capacity of tobacco and lottery tickets, plus vehicle regis- Intermediate and Municipal Bodies tration fees18; road, highway and harbor taxes in Chile, in Bolivia, departments receive royal- In essence, the political autonomy of any tiesforexploitationofhydrocarbons.InBolivia, sub-national government depends largely the amount of the income and the system of on its financial strength. Self-administered compensation to departments that do not pro- revenue comes primarily from local taxes, ducehydrocarbonsexplainstherelativeimpor- over which autonomous local governments tance of the intermediate-level expenditure. exercise direct control. But in Latin Amer- ica, restrictions on local taxation powers Most countries do not grant municipalities the 18. In Colombia, in are one of the main limitations of decen- right to determine taxation. Usually, the 2000 the tax income from the tralization processes. In most countries, intermediate governments in the federal departments the municipalities do not have the power to countries, or the national governments and corresponded to impose duties and local taxes. Rather they parliamentsintheunitarycountriesretainthe 10% of the national have a high level of dependence on central right to approve the respective values for total, 1.8% of the funds transfers, and although the degree of municipal income laws. GDP, while that of dependence varies from one country to the municipalities another, the overall trend appears to be With some exceptions, taxation powers are rose to 15%, 2.7% moving toward increasing dependency. similar in federal and unitary country munici- of the GDP. (Jaime palities. The most common taxes are those Bonet, In the federal countries, most local income on property, vehicle circulation and economic Descentralización is derived from fiscal co-participation, al- activities, including licenses for businesses fiscal y though important revenues are sometimes and industries or income from industry and Disparidades en Ingreso Regional, set aside at the intermediate level. commerce. Throughout the region, the most Banco de la important source of municipal revenue is the República, CEER, · In Argentina, the provinces receive taxes tax on property. The exceptions are Nov. 2004). on income, property, fiscal stamps and Argentina, where it is a provincial tax; El Sal- LATIN AMERICA Decentralization and Local Democracy in the World 185 vador, where it is the responsibility of central the self-administered resources. In Argentina, government; and the Dominican Republic, local tax collection amounted to 48% of rev- which does not have property taxes. As far as enue in the year 2000, although in some the tax on vehicle circulation is concerned, provinces it did not reach 10%20. In Colom- Argentina and Brazil are also exceptions; in bia, taxes collected by Bogotá represented those countries it is managed by the interme- 40% of total municipal revenue in 2000. diate government. Mexico allocates it to the Something similar occurred with the metrop- national government. olises of the Central American countries. In general, taxation pressure in Latin America This inequality in taxation capacity translates, is low (16.9% of the GDP, CEPAL19), and this in many countries, into a tendency toward is especially critical at the local level where stagnation in the collection of municipal taxes the capacity to collect taxes is weak. What is and local duties. This typically leads to an collected generally represents a limited per- increaseintransfers,asinBolivia,Colombia21, centage of the local budget. Because of the Ecuador, El Salvador, Guatemala, Mexico, heterogeneity of the territories, population Nicaragua and República Bolivariana de and wealth of the municipalities, the yield of Venezuela. In Mexico, self-administered taxes and duties is extremely unequal. The municipal taxes did not increase from most developed urban municipalities have 1994 to 2004, but transfers increased access to significant resources of their own, three times22 during those years. but this is certainly not the case in poor or rural municipalities. However, there are some clear indications that decentralization does not necessarily In Brazil, self-administered fiscal resources induce fiscal laziness. Territorial revenues in represented almost 32% of the budget in Colombia have grown steadily over the past municipalities with more than 500,000 inhab- decade, and as regards revenue behavior itants in 2000, but only reached 5% of the patterns, the municipalities have done bet- budget in municipalities with fewer than ter than the departments23. Increases in ter- 20,000 inhabitants, yet the latter comprise ritorial entities' share of national income 72% of all the nation's municipalities. In have often been accompanied by an República Bolivariana de Venezuela, 50% of increase in regional tax collection efforts. the municipalities with fewer than 50,000 Between 1996 and 2004, the great majority inhabitants depend on 80% of the national of municipalities enjoyed a real increase in transfers, while 2% of the municipalities with tax revenues. There is no evidence, given a greater number of inhabitants have 90% of the experience of the municipalities over the 19. Cited by Oscar Cetrángolo, "Descentralización y Federalismo Fiscal: aspectos teóricos y práctica en América Latina," Seminario internacional, Arequipa, 30 and 31 October 2006. The country with the highest fiscal pressure is Brazil (35.9%) and the lowest is Guatemala (10.6%). 20. The main sources of resources are the taxes for services of lighting, sweeping and cleaning, environment and health regulations for companies and industries, road maintenance and improvement of infrastructures. 21. The percentage of self-administered taxes collected from the Colombian municipalities went from 76% in 1984 to 44% in 2000 and that of the departments from 97% to 45% over the same period. 22. Peru is in a similar case: local collection increased at a rate less than the transfers (21% and 82% respectively between 2003 and 2006), which is due to the acceleration of the process of transferring responsibilities and resources since 2002, National Decentralization Council, Report 2005. 23. In real terms, municipal revenues increased by 28% between 1996 and 2004, compared with 20% at the department level. Source: la Comptroller General's Office of the Republic: "Informe social. Evaluación a las transferencias intergubernamentales 1994-2005" and Boletín de Coyuntura Fiscal 3 CONFIS, Ministry of Finance and Public Credit, Colombia. LATIN AMERICA 186 Decentralization and Local Democracy in the World The collection of past years, to support the hypothesis that on central transfers. In Nicaragua, local an increase in transfers causes a reduction taxation had great importance in the last property tax is far in local tax collection24. decade, thanks to the Municipal Sales from efficient Tax (ISV), but this decreased from 5% to Frequently, the municipalities do not have 1% of gross sales. because of the mechanisms needed to increase collec- outdated property tion, either because they are not the ones In Costa Rica and Panama, the weakness who do the collecting or because they do of the transfers, and above all the reduced registers and real not have the authority to set levels of taxa- municipal responsibilities and levels of estate evaluations, tion. In particular, the collection of property spending mean that local revenue ­local tax is far from efficient because of outdated taxes and duties­ represents between excessive property registers and real estate evalua- 96% and 75% of municipal income. Some- exemptions, and a tions, excessive exemptions, and a culture thing similar occurs with Paraguay in the rife among municipalities and citizens of tol- Southern Cone where transfers represent culture rife among erance for not collecting or paying taxes. just 11% of municipal budgets. But in this This matter should be a priority and is a key group, local budgets are mostly low. All the municipalities and issue in decentralization25. However, the si- same, within this group of countries, good citizens of tuation varies from country to country, and levels of income are not synonymous with among municipalities. In Costa Rica, for greater autonomy; rather, it points to a tolerance for not example, when the municipalities assumed lack of interest and efficiency in the central collecting or paying cadastral management, their revenues governments' systems for redistribution of increased considerably; however, the cen- revenue to less favored territories. In this taxes tral government changed the rules of the sense, the high percentage of own-source game, to the detriment of the municipalities revenues stands out against the limited that are making a greater fiscal effort26. The budget and responsibilities for local gov- law in Ecuador imposes a bi-annual review ernments. of the cadastral evaluations, from a mini- mum 2/1000 up to 5/1000. III.3. Transfers and Compensatory Financing Local taxation structures ­often archaic and inefficient­ also have much to do Transfers from central governments ­or in- with the low level of tax collection. For termediate governments in the federal example, in the Dominican Republic, the countries­ to local governments have local tax structure includes 70 taxes, but increased in recent years. These may be the municipalities only bring in 30% of free of use or directed and tend to include these monies. In Central American compensation mechanisms to limit regional municipalities, tax revenue represents, imbalances. Free transfers support on average, 0.58% of GDP. The municipal autonomous sub-national decisions and are contribution to the GDP is what is financed through tax revenue co-participa- reflected in minimum local taxation. In El tion systems. Directed transfers address Salvador, Guatemala and Nicaragua, the the operational costs of national policies, municipalities depend to a large extent such as those for health and education 24. Different studies show that there is not sufficient evidence to support the existence of fiscal laziness. rather, it has been proven that in regions with greater economic activity, the decentralization process tends to revitalize the tax collection process. 25. Nickson, Andrew, 2006. Certain cities make an effort to improve the outdated register of the commercial values of properties (Bogotá, La Paz, Quito, Nicaraguan municipalities). Among the measures are: restructuring the legal framework, modernizing collection, computerized systems and self evaluation. 26. Information provided by the National Union of Local Governments in Costa Rica, UNGL. LATIN AMERICA Decentralization and Local Democracy in the World 187 Box 1 Transfer Systems in Latin America · Argentina. The Regime of Federal Co-participation with the provinces contributes 57% of the collection of taxes on income, wealth and sales27. The provinces transfer part of these funds to the municipalities, to which they add two transfers: a) maintenance of schools, hospitals and specific projects, and b) discretional resources. Together it adds up to more than 50% of municipal revenue. · Brazil. The two main sources are the Municipalities Participation Fund (FPM) and the States and Federal District Participation Fund (FPE); both are fed by national taxes28. Furthermore, the municipalities receive transfers from the states (25% tax on the circulation of goods and services, 50% tax on vehicles and the exportation of goods). Some municipalities receive royalties for the exploitation of natural resources. Transfers over the municipal budget have increased in the past decade, reaching 90% of the budget for the smallest municipalities. · Mexico. Allocates participations and contributions to draw on federal income. The former are transferred to the states and municipalities through the Municipal Promotion Fund. The latter are for restricted use by the states and municipalities29. Other transfers exist through oil and export revenue in certain states. Transfers go from 52% of municipal resources in 1990 to 90% in 2005, in particular thanks to "branch 33." · Venezuela, R. B. Municipal dependency on transfers rose from 35% in 1986 to 48% in 1998. It is based on the Treasury Fund (20% of tax income) and extraordinary contributions (Inter governmental Decentralization Fund, with resources from VAT and the Law of Special Economic Assignations, with oil resources). · Colombia. The General Participations System (articles 356 and 357 of the Constitution) provides the resources transferred by the state to territorial entities (departments, municipalities and districts, and indigenous reserves) to finance the services that are their responsibility. The resources are divided into: sector allocations for education (58%), health (24.5%), drinking water and basic sanitation (17%), and special allocations (4%). The distribution of resources is based on population, attended population, population to be attended, equity, fiscal efficiency, administrative efficiency and relative poverty. · Bolivia. Tax co-participation transfers to the municipalities amount to 20% of the national taxes, less the Special Hydrocarbon Tax. To this are added resources from debt cancellation (HIPC I y II) for education, health and investment in infrastructure and the Fund for Productive and Social Investment (FPS). The transfers contribute two thirds of the municipal budgets; 85% is used for investment. · Ecuador. The transfers derive from the Sectorial Development Fund (FODESEC) and the distribution of 15% of current income from the central government budget. Both sources allocate 80% and 70% respectively of their funds to the municipalities and 20% and 30% to the provincial councils. The transfers represent between 47% and 74% of the municipal budgets (1998-2000), and are generally conditional --they are usually earmarked for public investment, not for current expenditure. · Chile. The Common Municipal Fund redistributes 30% of municipal taxes (zoning tax, commercial patents, vehicle tax) with the role of addressing imbalances between rich and poor municipalities. The Ministries of Health and Education allocate transfers to finance the corresponding responsibilities. The National Fund for Regional Development, FNDR, and the National Fund for Social Investment, FOSIS, deliver resources to projects for social investment and to reduce poverty. Various other sectorial funds exist. The transfers constitute half of the total municipal resources. · Peru. Free availability transfers more than doubled between 2003 and 2006 and the municipalities were the main beneficiaries. Of these transfers, 36% come from the Municipal Compensation Fund based on the national taxes collected, 16% of the Canon (levy) and royalties for exploiting natural resources, and 2% for participation on Customs Duty. The regional governments receive 2% from FONCOR, 4% from the Canon and 1% from Customs Duty. In addition there are transfers of funds from sectorial programs and projects (FONCODES, PRONAA, PROVIAS, etc.) · Uruguay. Transfers account for between 33% and 16% of departmental budgets. · Paraguay. Limited transfers derive from royalties from bi-national hydroelectric companies. · Central America. The legislation allocates a growing percentage of the national budgets to the municipalities: 10% in Guatemala, 7% in El Salvador, 6% in Nicaragua (it will reach 10% in 2010)30, 5% in Honduras, although the government failed to meet the targets. In Costa Rica the constitutional mandate (2001), which allocated 10% of the national budget to the municipalities, has not yet been implemented. In Panama there is no norm for transfer to the municipalities. · Dominican Republic. Although Law 166 (2003) raises transfers to the municipalities from 6% to 10% of the national budget, only 8% had been transferred (2005). Even so, resources have more than doubled in two years. The Dominican Municipal League, in charge of the transfers, fulfils a controlling and inspecting role over the town councils. Transfers represent 90% of the local budget in most municipalities. 27. Moreover, through fiduciary funds for provincial development, the provinces receive resources for debt reduction programmes, in exchange for greater fiscal control. 28. They receive 22% of income tax, 21.5% on industrial products, 50% of the rural property tax and 30% of the tax on financial operations. In addition, the Compensation Fund for the Exportation of Industrial Products (FPEX), the Fund for the Maintenance and Functioning of Teaching (FUNDEP) and the Rural Property Tax (ITR). 29. Branch 33 of the budget includes 7 funds for municipal activities: primary and normal education; health; social infrastructure; strengthening of municipalities and delegations of the Federal District; multiple contributions; technological and adult education; public safety. To these are added specific funds from branches 25 and 39, such as resources for state infrastructures and for natural disasters. 30. The Law of Financial Transfers of 2004 stipulates that, beginning with 4% of the current revenue of the state, transfers to the municipalities must increase annually to 10% of the budget in 2010. The municipalities also receive resources for investment from the FISE and the Institute of Rural Development (IDR). LATIN AMERICA 188 Decentralization and Local Democracy in the World services. These services are delivered by emergency situations or reconstruction, or sub-national governments with transfers as social compensation for national macro- carried out through difficult systems of economic adjustments. However, they have monitoring, control and evaluation. become permanent and now channel investment into infrastructure, basic In Latin America, different transfer systems services or the promotion of productive are used ­over fiscal income or the national development. Frequently, they handle budget­ with varying fixed or variable per- resources that surpass those of the centages, distribution criteria by levels of municipalities without being subject to government and other conditions (see the democratic and civic control of the box)31. Distribution criteria for transfers latter34. involve different factors ­population, levels of poverty, access to services, economic po- The excessive proliferation of bidding tential, efficiency in management­ but they funds for projects has a negative impact have limited impact on limiting regional gaps. on intermediate and small municipalities. Smaller cities often can not partake of Directed transfers encompass a wide range such funds because the terms are too of objectives that respond to national poli- complex, and the local staff lacks the cies, and only collaterally to the strengthen- ability to draw up sufficient projects. In ing of democracy and local governance. The Chile, it is calculated that there are some majority of countries have sectorial funds for 200 funds and sectorial programs related carrying out projects, which in federal coun- to municipal management. tries may be administered by the intermedi- ate governments32. In the unitary countries Recently, systems of direct transfer from they are usually administered by the national government to poor families autonomous institutions that manage re- and people are taking on greater impor- sources from the central government and in- tance. Some of them bypass sub-national ternational financing in a centralized way33. bodies, or tolerate little intervention.35 In For example, the Fund for Productive and Mexico these transfers give rise to the Social Investment (FPS) in Bolivia co- "Opportunities" program; in Argentina to finances the provision of infrastructure and the "Heads of Household" program; in Brazil equipment for educational establishments. the "Family Grant"; in República Bolivariana de Venezuela it gave rise to "Different Mis- In Central America, the funds were created sions"; and in Colombia to "Families in through peace agreements to deal with Action." In Chile a new National System of 31. Martín, Juan and Martner, Ricardo, 2004 pp. 77 and following; Finot, Iván, 2001, pp. 87 and following. 32. This is what occurs with the National Funds for Housing, Provincial Roads and Rural Electrification in Argentina, the transfers from the Single Health System and the Social Contribution to the Education Salary in Brazil, and the Funds for Contributing to Primary and Normal Education and the Health Services in Mexico. 33. Fund for Productive and Social Investment (FPS), Bolivia; Fund for Compensation and Social Development in Peru; National Fund for Regional Development, FNDR and Fund for Solidarity and Social Investment, FOSIS, in Chile; Fund for Social Investment (FIS) and Solidarity Fund for Community Development (FDSC), in Guatemala; FISDL, in El Salvador; FHIS, in Honduras; FISE in Nicaragua; Fund for Indigenous Guatemalan Development, and Fund for Agricultural Development and Guatemalan Housing Fund. 34. The Fund for Social and Economic Investment (FISE) in Nicaragua is another example: an autonomous organization which depends on the Presidency of the Republic, with funding from the central government, bilateral donations from foreign governments and loans from the Inter-American Development Bank and the World Bank. Something similar occurs with the Social Investment Fund for Local Development (FISDL) in El Salvador, which finances strategies for the eradication of poverty and local economic development, along with the Honduran Fund for Social Investment (FHIS). 35. On occasion they are even manipulated for election purposes. LATIN AMERICA Decentralization and Local Democracy in the World 189 Social Protection was organized for the uni- the municipalities, the audit would be car- fication and better coordination of the dif- ried out by the Court of Auditors of the ferent social subsidies granted to poor fa- Union. The state legislatures are the milies through the municipalities. organs of oversight of the municipalities, although control of federal resources is III.4. Control Systems and exercised by the Superior Auditor of the Difficulties of Indebtedness Federation's Office, which in turn depends on the Union Congress. The expenditure of Latin American munici- palities is subject to internal and external In recent years, the problem of debt has controls. For internal control, the bigger been a priority. Different countries face fis- municipalities establish a municipal accounts cal problems through the indebtedness of office or audit unit ­organs granted a cer- the sub-national entities. Although in most tain technical autonomy. In municipalities countries sub-national government borrow- with a weak structure, this task is entrusted ing must be approved by national govern- to the municipal treasurer or the person in ment, this does not guarantee discipline; charge of finance. some countries are trying more innovative solutions to avoid excessive borrowing36. There are different models of external con- trol. In some countries there is still a control In 1997, Colombia established a `traffic of the budget by national institutes whose light' system for regulating sub-national function is to support, control and inspect. borrowing relative to the level of debt This is the case with the Dominican Munici- incurred by the regional entity. The law pal League, but also with the Institutes for establishes the basis for territorial fiscal ad- Municipal Promotion or the Comptrollers justment through borrowing performance Offices in some Central American countries. agreements that are controlled at national In Costa Rica, for example, municipal budg- level. These not only limit the debt capac- ets have to be approved by the controlaría ity, but also manage the repayment of before they can be allocated. loans, essentially duplicating the IMF sys- tem internally. Other laws have comple- In many unitary states, the external control mented this policy with good results. 36. Law of fiscal responsibility in over the intermediate-level local govern- Brazil (2000), the ment bodies is exercised by the Controlaria. III.5. Public Services "semaphore Bolivia, Chile, Costa Rica, Ecuador, Gua- system" in temala, Nicaragua, Paraguay and República The financial capacity of the municipalities is Colombia ­ by Law Bolivariana de Venezuela still maintain this closely connected to the delivery of public 358 of 1997, in form of external control. In El Salvador and services. In the second half of the 20th Cen- Ecuador, the Law of Honduras, control is exercised by the audit tury, national and intermediate govern- Responsibility, board or the superior auditor body. ments absorbed public services which, Stabilization and according to the principle of subsidiarity, are Fiscal Transparency In the federal countries, external control is most effectively provided by the municipali- of 2002. more complex, since both international ties. New support for decentralization has 37. Martín, Juan and and national entities intervene. Thus, in begun to reverse the old approach37. Martner, Ricardo (coordinators), Argentina and Brazil external scrutiny of "Estado de las the mayor --intendente or prefeito-- is The public services generally attributed to finanzas públicas: conducted by the Deliberating Council or municipalities include the provision of: América Latina y El Town Council with the assistance of the urban cleanliness, refuse collection and Caribe", cit. pp. 62 provincial or State Court of Auditors or the treatment, drinking water, drainage and and ff, see table 9 Municipal Court of Auditors, created by the sewers, public lighting, town planning, on revenues and provincial or state government. Should the parks, gardens and spaces for sport, mar- total expenditure at federation have transferred resources to kets, cemeteries and slaughterhouses, government level. LATIN AMERICA 190 Decentralization and Local Democracy in the World traffic regulation, roads and civic safety, private sector operators39 in the major mu- public shows and culture (see table 4). nicipalities of La Paz, Cochabamba and Guayaquil. Nevertheless, the management Bolivia, Brazil, Chile, Colombia and Mexico of some services is returning to public have transferred to intermediate and local authorities at the local (as is the case in levels responsibility for managing health Bolivia and shortly in Guayaquil) and care, primary and secondary education, national (Buenos Aires) levels. and social assistance38 . In Brazil, there is some overlap of responsi- Latin American municipalities also share bilities between levels of government in the management of public services with some regions; others have some inadequate the intermediate entities and the national services or lack certain services entirely. government. The specific services differ in While responsibility for education and health each country, but among the most com- is transferred to the intermediate govern- mon are planning, education, health, civil ments and municipalities with sufficient protection, environmental protection, sport administrative capacity, small municipalities and culture. When these are shared by dif- give up part of their responsibilities, such as ferent levels of government, each level ta- construction and maintenance of roads, in kes responsibility for certain components exchange for a portion of the fuel tax. The of the policy. However, problems of coordi- division of responsibilities usually follows nation as well as ambiguities with respect sectorial logic (water and sanitation and to management responsibility are fairly education are dealt with by the states; the common at each level. financing of health, housing and sanitation is done by the federal government). Under the influence of neo-liberalism in the 1990s, many countries opted for the con- In Argentina in the 1990s, while services cession or privatization of local services. In managed by the national Government and Argentina all of the local public services in provinces were privatized, the municipali- the metropolitan area of Buenos Aires and ties held onto the services for which they the provinces in the interior were granted in were responsible. Furthermore, those with concession: mainly water, sanitation and greater capacity40 took on new responsibil- energy services. In Chile, the basic services ities41. In addition, through delegation of of water, sewers, electricity, gas and tele- the upper levels of the government, some phone systems were privatized and taken municipalities administer social policies and over by regional and national companies. In temporary work programs, programs offer- Bolivia and Ecuador, the management of ing assistance to micro-companies, and drinking water and sewers has been priva- small and medium companies, and the de- tized, granted in concession or delegated to velopment of sanitation. 38. There are important differences among countries. In Chile, the municipalities administer integrally primary health care, and primary and secondary education. In Bolivia, they are only responsible for the administration and maintenance of infrastructure and equipment of the establishments. In Argentina, the municipalities carry out complementary actions for infrastructure maintenance, and in the health sector they share primary health care. 39. The concept of "privatization" is generally avoided as it tends to generate strong resistance. Bolivia, for example, opted for "capitalization" where private firms bring capital to public enterprizes, taking over their control. 40. The municipality of Rio Cuarto, in the province of Cordoba took on the water supply company --first national, then provincial; through excellent management of the water service, self-financing has been achieved for the first time in years. 41. Among the new responsibilities: environment, civic safety, economic promotion, access to justice and resolution of conflicts between family members and neighbors without recourse to the law; social promotion (young people, senior citizens, gender equality, disability), health, promotion of culture and sport; and education insofar as it complements the efforts of other levels of government. Table 4 Municipal Responsibilities in Latin America Basic services Food distribution Urban planning Social services Economic development City safety UO W DW SS SL Cem M B P RI TRNS T PS PHC H SS C S/L ED J Tourism CS FB RP E LATIN Argentina X X S S X X X X X S X S S X X X S S S X X Bolivia X X X X X X X X X S X S S S X X S X X X Brazil X X X X X X X X S X S X X X X X X S S S S S X S Chile X X X X X X X S X X S S S S S X S S S S S S S Colombia X X X X X X X X X X X S S S S S X X S X S S X Costa Rica X X * X X X X X S X S S X Dominican Rep. X X X X X X X X O X X O O Ecuador X X X X X X X X X X Conv Conv X AMERI El Salvador X X Pil exp X X X X X X C X Decentrali Guatemala X X X X X X X X X X X S X Honduras X X X X X X X X X X X X X X X X zationan Mexico X X X X X X X X X X X X X X Nicaragua X X S S X X X X X X X S X X X X X S X dLocal Panama X X X X X X Dem Paraguay X X S S X X X X X S S X X Peru X X X X X X X X X X S S X S X S S S ocracyin CA Uruguay X X X X X X X X X X X S X X X X X X Venezuela, R. B. X X X X X X X X X X S X X X X X X X X theWorld S: Shared; O: Optional; Pil exp: Pilot experiencies; Conv: Convention; UO: Urban ownership ; W: Waste; DW: Drinking water; SS: Sewer system; SL: Street light; Cem: Cemetery; M: Market; B: Butchery, slaughterhouse; P: Urban planning -land regulation and territorial planning; RI: Road infrastructure; TRNS: Transport; T: Traffic; PS: Primary school; PHC: Primary health care; H: Housing; SS: Social services ; C: Culture; S/L: Sport and leisure; ED: Economic development; J: Job offer; Tourism: Tourism; CS: City safety; FB: Fire brigades; RP: Risk prevention; E: Environment. 191 * In rural areas. LATIN AMERICA 192 Decentralization and Local Democracy in the World In Mexico, the state institutions and occa- more social services (primary health care), sionally federal ones intervene in the deliv- environmental protection and cultural de- ery of local services. Responsibility for velopment. drinking water, the management of town planning, roads and the collection of taxes In Central America, with the exception of has often been taken over by the states. Guatemala, the majority of local govern- The participation of local governments in ments take on the basic services with dif- administering education is limited to the ficulty and, in many cases, in precarious maintenance of certain infrastructures. By conditions. The activities that involve contrast, since 1997 the financing of social greater responsibility and require greater programs has been decentralized. The investment ­education, health, social well granting of services to the private sector is being, housing, aqueducts and sewers­ less common than in other Latin American are delivered at the national level, in the countries. majority of cases. In Bolivia, a uniform strategy of decentral- The municipalities frequently take on ization has been applied to all public serv- responsibilities not anticipated in the legisla- ices, including health, education, roadways tion. The municipality of San Pedro Sula in and micro­irrigation. Most are now allo- Honduras allocates resources for the main- cated to the municipalities. Since 2001, tenance of the hospital and payment of the decentralization policy in Ecuador has salaries to doctors, nurses and skilled work- opted for voluntary transfers of responsi- ers, in addition to providing refuse collection bilities through the signing of individual services to the hospitals free of charge. In agreements between the central govern- several countries, the municipalities take ment and the municipalities involved. New part in the construction and maintenance of responsibilities of special interest to local the basic infrastructures of education and governments are: the environment, health. In Honduras, water management, tourism, social welfare and, to a lesser previously in the hands of a state company, extent, education, housing and health42. was decentralized in 200345. In Paraguay, the municipalities provide a Regrettably, there are few studies that limited number of basic services43. The cen- make it possible to measure the impact of tral government assures the provision of all these processes of transfer on access most of the services, in particular drinking to, or quality of basic services. Neverthe- water, education and public transport44. In less, the existing data is promising: in Uruguay, these services are delivered at the Ecuador, for example, it is calculated that departmental level, including more and since the beginning of decentralization the 42. Fernando Carrión, "El proceso de descentralización en Ecuador," July 2006. Interest in new responsibilities for local governments is centered on three topics: environment 31.5%, tourism 24.6% and social well being 23.3%. To a lesser extent, education at 7%, and housing and health at 4%. 43. Hygiene, waste management, public lighting, slaughterhouses, markets, cemeteries, transport terminals. 44. At the end of the 1990s, agreements were made between the Ministry of Health, the departments and the municipalities to create departmental and local health councils with limited responsibilities in planning and management. In 2005, only 25% of the municipalities had signed agreements with the Ministry of Health. In 1996, the Department of Itapúa created a Rotating Fund for Medication for Social Pharmacies, which administers 70 social pharmacies in 30 municipalities (2002). Paraguay File. 45. In El Salvador, around 15 pilot projects have been set up transferring the management of water to mancomunidades or local companies. In Nicaragua, there are municipal companies or franchises at the municipal or regional level. Also in El Salvador and Nicaragua, in the social areas, a limited direct de-concentration is taking shape, aimed at the community and designed centrally (Ministries of Education, Health, Public Works). Ex: EDUCO program ­Education with Community Participation"­ in rural zones of El Salvador, and Co-management of Education and Health in Nicaragua. LATIN AMERICA Decentralization and Local Democracy in the World 193 percentage of houses connected to the Another group of countries ­República Boli- public sewer system has risen from 39.5% variana de Venezuela, Mexico, Uruguay, in 1990 to 48.5% in 2001; homes with Colombia and Argentina­ present civil serv- electricity went from 78% to 91%; domi- ice systems that are not particularly well ciliary connection to the drinking water organized. The situation is more critical in supply rose by 10%; and refuse collection the remaining Central American countries went up 20% at national level46. and particularly in Bolivia, Peru, Paraguay and Ecuador, where the degree of politiciza- In Chile, the favorable impact of local tion is higher48. This situation is worse at management is expressed in the positive the level of sub-national governments. evolution of the main indicators of social and human development (education, basic In the best-qualified countries ­Brazil, sanitation, health). For its part, the system Chile, Costa Rica­ local officials have gen- of directed subsidies, applied from the erally become integrated into national municipalities, has contributed decisively career systems that are now being to reducing poverty from 38% in 1989 to matched by systems at the municipal 18% in 200247. level. In Brazil, the 1988 Constitution allowed local governments to define their National Planning observed that in Colom- own statute for their three million employ- bia decentralization has improved the ees, but application of this is limited. rates of educational provision, literacy and coverage of health services. Nevertheless, In Chile, the 185,000 municipal employees 46. Ponce, Juan. La according to the same source, progress is (54% of public personnel, including teach- vivienda y la insufficient in basic social infrastructures ers and health workers) are mostly inte- infraestructura and provision of services, and regional dis- grated into different national personnel básica en el parities have increased. Improvements in evaluation systems and career services Ecuador: 1990- management have been significant, but statutes49. 2001. SIISE. Cited are still not adequate, although pre-exist- by F. Carrión, el ing imbalances have influenced this factor, Costa Rica had 10,755 municipal workers proceso de as have the difficulties related to the in 2004 (4.7% of public personnel), of descentralización armed conflict and lack of governance of whom 25% worked in San José50. In 1998 en Ecuador, July 2006. certain territories. a municipal administrative career path was 47. Ministry for National established, but it has not yet been imple- Planning in Chile mented to any effect. Similarly, in 2004 (MIDEPLAN). III.6. Local Government Personnel Nicaragua adopted the Ley de Carrera 48. See the Report on and Civil Service Career Administrativa Municipal (Municipal the Civil Service in Administrative Career Act). Latin America, For the intermediate sub-national entities AIDB, 2006. and municipalities, the absence of a civil Ecuador and Colombia have a legal frame- 49. Departmentof service career is a serious failing. In the work concerning the career civil service for Studies of the majority of countries the predominant sys- the public sector as a whole. In Colombia, Chilean Association tem in sub-national government is the it is calculated that in the 1990s municipal of Municipalities spoils system which gives rise to a large staff accounted for less than 10% of pub- (Asociación Chilena de Municipalidades scale rotation of staff, in particular at the lic personnel. In Mexico it was 5%. ­ ACHM). upper and intermediate levels, every time 50. Ministère des there are political changes that affect the In some provinces of Argentina, the Affaires Etrangères- administration. regime of employees is uniform between DGCID, Bilan des the provincial and the municipal level; in politiques de The best performing countries in terms of others, local governments have their own Décentralisation en development and institutions at the state regime, although mixed situations are the Amérique Latine, level are Chile, Brazil and Costa Rica. most common. décembre 2005. LATIN AMERICA 194 Decentralization and Local Democracy in the World In recent years, In most countries, public employees are sub- mixed systems are regularly established ject to national workers legislation and a spe- (example: single names and lists in República the great Latin cial employment status for public or munici- Bolivariana de Venezuela). The specifics American pal employees, although these practices are observed in different countries are influenced rarely applied in practice. Unfortunately, the by respective norms and traditional customs. metropolises have majority of these countries does not possess driven processes precise statistical data on public employees. The duration of the mandate of mayors and representative councilors varies from country of partial In theory, in the majority of countries, sub- to country. The majority tend to have man- decentralization national government officials and employees dates of four years (Central American coun- are covered by the national work law and by tries, Argentina, Brazil, Chile, Colombia, or deconcentration statute as public or municipal employees. Dominican Republic, República Bolivariana de into delegations However, in practice this is rarely fulfilled. Venezuela), but there are also some with Regrettably, most countries lack precise sta- three-year terms (Mexico), two and a half tistics about personnel in the intermediate (Cuba), and five-year terms (Bolivia, Peru, governments and municipalities51. Uruguay, Paraguay and Panama). Re-election of the mayor and councilors is usually allowed, except in Mexico and Colombia IV. Local Democracy where re-election to office is prohibited. IV.1. Local Electoral Regimes The municipalities of each nation possess their own territorial division, with sub-municipal With regard to municipal government, the entities with different names. Such entities are terms cabildo, town council, council or mu- beginning to be granted greater participation, nicipal corporation are used, with different and direct election of municipal authorities is national nuances. In most cases the municipal now taking place in various countries. Promis- institution is made up of: the mayor, inten- ing results have been observed in the cor- dente, síndico (trustee),municipalpresidentor regimientos of Panama; in the Neighborhood prefeito (prefect), who presides over it, repre- Associations' legal status and election through sents it and is in charge of the administration. direct suffrage in Chile; with the Juntas Veci- The concejales, regidores or vereadores (town nales (neighborhood associations) in Bolivia; councilors) act as a legislative body, although the Juntas Parroquiales electas (elected parish at times they receive specific commissions. associations) in Ecuador, which were briefly interruptedin1980;theelectedauxiliarypres- Direct election of mayors predominates in the idenciesofTlaxcalaandthemunicipalcommu- region, generally through a majority system, nities of Tabasco, in Mexico. 51. In Paraguay there on different dates from those designated for are 13,250 the national elections (Chile, Ecuador, In recent years, the great Latin American municipal Argentina, Uruguay, Brazil, Peru, Dominican metropolises have driven processes of partial employees (7.7% Republic, El Salvador, Nicaragua). In the fed- decentralization (18 community centres in of the public eral countries, local elections tend to coincide Montevideo and 15 communes in Buenos workforce), half with the provincial or state elections (Ar- Aires) or deconcentration into delegations, concentrated in the gentina, Brazil, Mexico). In Bolivia, the mayor sub-mayoral areas or sub-prefectures (16 in city of Asunción is elected indirectly from among the mem- Mexico City, 31 in São Paulo). In Mexico City, (6,500 employees). bers of the Municipal Council who are elected the delegation chiefs are elected by direct In Nicaragua, the by direct universal suffrage. Recently, the vote; in Buenos Aires community councilors number of method of election has changed from indirect are to be elected for the first time in 2007. municipal employees rose to to direct in Chile (2001), Costa Rica (2002), 8,648 in 2000; Nicaragua (1995), and República Bolivariana In the unitary countries, the process of elect- 31% of them work de Venezuela (1989). For the town coun- ing intermediate government authorities has in Managua. cilors, proportional representation or the been slow. In 2004, only half of the de- LATIN AMERICA Decentralization and Local Democracy in the World 195 partments or regions held elections (Colom- there were 838 women mayors serving in 16 bia, Bolivia, Ecuador, Peru and Paraguay). In Latin American countries, representing only the federal countries, the duration of go- 5.3% of the total (Table 5). The ratio of vernment terms of office does not always women to men councilors is slightly higher. coincide with those of the municipal authori- ties. In Mexico, for example, the governors There is open public debate in all the coun- have a mandate of six years, as opposed to tries throughout the region on the under-rep- three years for the mayors. resentation of women at local levels, and measures have been taken to improve the As for women's participation in local go- proportion of democratically elected women vernment in Latin America, recent studies officials in local government. The quota sys- show that women's political representation tem is the most common mechanism used to remains very low. Between 1999 and 2002, improve women's political participation52. Table 5 Women Mayors in Latin America (between 1999 and 2002) Country Number Percentage 1. Panama 1999 11 14.8 2. Costa Rica 1998 10 12.3 3. Chile 2000 39 11.4 4. Honduras 2002 29 9.7 52. In Argentina, for example, the law 5. El Salvador 2000 22 8.3 provides that women candidates 6. Nicaragua 2000 11 7.2 must be positioned 7. Colombia 2002 76 7.0 in proportions sufficient to get 8. Argentina 1999 136 6.4 elected; in Bolivia, a minimum of one 9. Bolivia 2002 19 6.0 in three candidates has to be a woman; 10. Brazil 2000 317 5.7 and in Paraguay, one in five 11. Paraguay 2002 12 5.6 candidates has to be a woman; by law 12. Venezuela, R. B. 2000 16 4.7 in Mexico no more than 70% of the 13. Mexico 2002 80 3.3 candidates can be of the same 14. Peru 2002 52 2.6 gender; and in 15. Ecuador 2000 5 2.3 Peru, at least 25% of the candidates 16. Guatemala 1999 3 0.9 must be women. There are electoral Latin America 832 5.3 gender quotas also in Ecuador and Source: "Participar es llegar", Alejandra Massolo, INSTRAW. Dominican United Nations. Dominican Republic, 2006. Republic. LATIN AMERICA 196 Decentralization and Local Democracy in the World IV.2. Civic Participation cal competition has emerged, and in just a few years it has overtaken the institutional Latin American democracy has made quasi-monopoly exercised by a single party, progress. According to the Index of Electoral contributing to the democratization of national Democracy (IED) ­whose values vary political life. New local and regional parties, between 0 and 1­ the region goes from supporting new leaders, have also emerged. 0.28 in 1977 to 0.93 in 2002. Moreover, 89.3% of the potential voters are registered In Peru, the new Ley de Partidos Políticos on the electoral rolls, 62.7% actually vote (Political Parties Act) allows the appearance and 56.1% cast a valid vote. These percent- of regional political groupings and the for- ages for participation in elections are below mation of provincial and district political those of European countries, but are supe- committees that obligate the national politi- rior to those recorded in the United States53. cal parties to review their structures and But significant progress is still needed in renew their leaders. In Colombia and other many respects: transparency in the financ- countries, national political figures are start- Multiple procedures ing of parties, the struggle against corrup- ing to emerge from the local level. tion, and in overcoming clientism. for citizen Multiple procedures for citizen participation At the local level, participation in elections is have been formally introduced into almost participation have high, although in some countries it is tend- all the countries, although these are not been formally ing to decrease. In Argentina, Brazil and always effective or really used. The constitu- Uruguay, where participation exceeds 80%, tions and legal reforms define a broad range introduced into voting is mandatory. of forms of participation. almost all the In Bolivia, participation in local elections has In Brazil, the Constitution of 1988 mentions countries, although oscillated between 59% and 63% from the the plebiscite, referendum, popular tribune, these are not mid-1990s to the present. In Paraguay, par- popular councils, and the right to popular ini- ticipation declined from 80% between 1991 tiative with the support of 5% of the voters. always effective or and 1996, the first period of democratically But it is the participatory budget that has really used elected local authorities, to 50% between achieved world recognition as the expression 2001 and 2006. In the local elections of 2005 of direct democracy whereby the community in República Bolivariana de Venezuela, up to becomes involved in formulating the plan for 69% of the voters abstained, because of the municipal investment. This procedure has political situation and the call by opposition been applied in Porto Alegre since 1989, and sectors to abstain from voting. However, his- is used in more than 100 Brazilian cities. It torically the level of participation in municipal has also been extended to some municipali- elections in Venezuela has been quite low. ties in Argentina, Ecuador, Colombia, Uruguay, the Dominican Republic, Paraguay In Central America, general average partici- and Chile, albeit in simplified form. In the pation is near 50% of the population of vot- Dominican Republic, in 2006, more than 110 ing age, except for Nicaragua where partici- municipalities (two thirds of the country) were pation exceeds 70%. In Guatemala in the applying the participatory budget. election of 2003, 58% of registered voters voted in the municipal and general elections. In Bolivia, the Ley de Participación Popular In Costa Rica, in the first local elections for (Law of Popular Participation) of 1994 has mayor in 2002, abstentionism reached 48% generated new participatory practices in the of the electorate in some municipal cantons. municipalities through the Territorial Base 53. La democracia en Organizations (OTBs). Through these, the América Latina Political pluralism has taken root throughout communities take part in the municipal PNUD, 2004, pp. 77 the region, except in Cuba. In Mexico, for development and annual operating plans and following. example, at the local level a genuine politi- that are required in order to access co-par- LATIN AMERICA Decentralization and Local Democracy in the World 197 ticipation funds. The oversight committee offered for organizing the population elected by the OTB monitors the implemen- through Neighborhood Associations, com- tation of development plans, along with the missions or neighborhood councils and other sub-mayors and social syndicates. The result forms of association (Argentina, Chile, has been encouraging in most municipalities, Paraguay, Ecuador, República Bolivariana de above all in the regions of Chapare and Venezuela, Colombia, Uruguay). In Chile, Santa Cruz. But in many cases, legal require- more than 65,000 local organizations linked ments have given rise to bureaucratic prac- to the municipalities manage requests and tices that get in the way of genuine partici- projects. Regrettably, the level of participa- pation, reinforcing clientism and corruption. tion in neighborhood elections and in the life of the organizations is tending to decrease55. In República Bolivariana de Venezuela, the Constitution and the law are fairly careful in In Uruguay, the neighborhood councils in setting up mechanisms for civic participation, Montevideo are elected and have a consul- but do not clearly define the ways to make tative role. Moreover, "defenders of the peo- them operational. The recently passed Ley de ple" (ombudsmen), have been created; this los Consejos Comunales (CommunityCouncils post is also included in the Argentine consti- Act) of April 2006 creates a new framework tutional reform of 1994. for participation through the Community Councils responsible for bringing together dif- Popular initiatives and consultation are ferent community organizations, social groups provided for by law in various Latin Amer- and citizens for the direct management of ican countries, including Chile and publicpoliciesatlocallevel.Thisinitiativedoes Uruguay. For its part, the cabildo abierto however present the risk of displacement to ­open session of the Municipal Council­ these Community Councils, which are highly with a broader participation by the com- dependent on presidential authority, of pro- munity, serves to sound out the commu- grams and resources that should be chan- nity with respect to certain impending neled through the municipalities, as the pri- decisions. This last modality has spread mary political unit of the national organization particularly in Central America (Costa Rica, 54. See "La Asamblea and democratic participation. Nicaragua and El Salvador), and since Cantonal de 2004 Guatemala has instituted popular Cotacachi" - International In Ecuador, in a context in which national consultation with neighbors and indige- Experiences institutions have lost their legitimacy, citizen nous peoples. Such processes are, how- www.municipium.cl participation has been channeled toward ever, still in the earliest developmental 55. UNDP: Social local governments through strategic plan- stages56. capital Map of Chile. ning in formulating provincial plans (18), 56. Procedures of social municipal plans (more than 100) and partic- Procedures for the recall of municipal elected participation have ipatory budgets, and through local sectorial officials also exist. In Colombia, the program- also been instituted committees for public works and service matic vote is taken into account: the mayor in local planning: provision; one outstanding example is the submits his program and if he does not carry community participatory experience in the municipality it out, revocation may take place. In development of Cotacachi54. República Bolivariana de Venezuela, the leg- councils, COCODES, islation allows for a revocatory referendum and municipal development Also in Peru, recent legislation has promoted for the mayors. In other countries, revocation councils, the creation of Councils for Regional and is allowed for cases of corruption or non-ful- COMUDES, in Local Coordination as spaces in which to fillment of the municipal development plan Guatemala; participate, and Development Plans and Par- (Ecuador, Costa Rica). In Bolivia, the mayor is Councils for ticipatory Budgets in the different levels of removed from office by the constructive cen- Municipal government (districts, provincial municipali- sure vote of 60% of the councilors, who then Development, ties and regional governments). choose from among themselves the person CODEM, in In the majority of countries, incentives are who will replace him. It is often used in Honduras, etc. LATIN AMERICA 198 Decentralization and Local Democracy in the World response to party political issues rather than ties and Colombian nationals abroad, questions of bad management. with five representatives in Congress. In the interests of greater transparency in · Guatemala recognizes the multi-ethnic management, Brazil and other countries and multicultural character of the munic- have legislated to oblige local governments ipalities, as well as the indigenous may- to publish their public accounts, and are oralties, councils of Mayan Advisers and exploring other mechanisms for the diffu- the law of national languages. sion of public information. · As a result of the Chiapas uprising, in In Cuba, "socialist democracy" establishes Mexico indigenous rights are included in the principle of presenting accounts once a the Constitution. Among state legisla- year, and revoking the mandate of the dele- tures, Oaxaca stands out with 480 gates elected to the Popular Power Assembly. municipalities electing their authorities by use and custom. IV.3. Minority Rights · Nicaragua grants constitutional auto- The rights of Native peoples are an important part of the nomy to two regions on its Atlantic population in numerous Latin American Coast by means of a Statute of indigenous peoples countries. In Bolivia, Ecuador, Guatemala, Autonomy and each region's own Ley and of other Peru and some regions of Mexico, they make de Propiedad (Property Law). In this up between 12% and 70% of the popula- way, native indigenous peoples live minorities are tion. Significant minorities constituting 10% alongside Afro-descendants and other moving forward or more of the population live in specific social groups. regions of Belize, Chile, Paraguay, El Sal- through different vador, Honduras, Nicaragua and Panama. · In Panama, the Comarca de San Blas options, although The rights of indigenous peoples and of (Indigenous Community of San Blas) has other minorities are moving forward through constitutional autonomy because that is the process is still different options, although the process is where the Kuna people live, having been incipient and does still incipient and does not apply in all coun- granted their own charter. Their highest tries. authority is the Congress of Kuna Cul- not apply in all ture. They are entitled to two legislators in the parliament. countries · In Bolivia, the Ley de Agrupaciones Ciu- dadanas y Grupos Indígenas (Civic Asso- ciations and Indigenous Groups Act) of · In República Bolivariana de Venezuela, 2004 gives electoral guarantees, the the law recognizes that in the municipali- right to present candidates, and recogni- ties where there are indigenous commu- tion of the traditional authorities. The nities, their values, ethnic identity and practice of old forms of direct democracy traditions must be respected. The figure inherited from the ayllus, agricultural of the indigenous municipality is estab- syndicates, neighborhood associations, lished, and through it the indigenous peo- and other forms of community participa- ples and communities define, execute, tion is very common in local life. control and evaluate public management. · Brazil recognizes indigenous rights in the IV.4. Municipal Associativism and constitution. Defence of Municipal Autonomy · In Colombia, indigenous territorial enti- The transformations in local governments ties may be formed with their Council, caused by decentralization processes per- and a special circumscription is antici- mit the creation and strengthening of pated for ethnic groups, political minori- national and regional associations of local LATIN AMERICA Decentralization and Local Democracy in the World 199 Table 6 Associations of Municipalities in Latin America Country / Region Name of the association Acronym Year founded Regional Associations Latin America Latin American Federation Cities, Municipalities and Local Government Associations FLACMA 2003 Sub-regional Associations Central America Federation of Municipalities of the Central American Isthmus FEMICA 1991 Mercosur Mercocities 1995 National Associations Argentina Argentine Federation of Municipalities FAM 1997 Bolivia Federation of Municipal Associations of Bolivia FAM 1999 Brazil Brazilian Association of Municipalities ABM 1946 National Confederation of Municipalities CNM 1980 National Front of Prefects FNP 2001 Colombia Colombian Federation of Municipalities FCM 1989 Costa Rica National Union of Local Governments UNGL 1977 Chile Chilean Association of Municipalities ACHM 1993 Ecuador Association of Ecuadorian Municipalities AME 1940 El Salvador Municipal Corporation of the Republic of El Salvador COMURES 1941 Guatemala National Association of Municipalities of Guatemala ANAM 1960 Honduras Association of Municipalities of Honduras AMHON 1962 Mexico Association of Local Authorities of Mexico AALMAC 1997 Mexican Association of Municipalities AMMAC 1994 National Federation of Municipalities of Mexico FENAMM 1997 Nicaragua Association of Municipalities of Nicaragua AMUNIC 1993 Panama Association of Municipalities of Panama AMUPA 1995 Paraguay Paraguayan Organization of Inter-municipal Cooperation OPACI 1964 Peru Association of Municipalities of Peru AMPE 1982 National Association of District Mayors ANADIS 2003 Network of Rural Municipalities of Peru REMURPE 1997 Dominican Rep. Dominican Federation of Municipalities FEDOMU 2001 Uruguay National Congress of Intendentes CNI 1959 Venezuela, R. B. Association of Venezuelan Mayors ADAVE 1996 Association of Boliviarian Mayors ADABOVE LATIN AMERICA 200 Decentralization and Local Democracy in the World authorities. With the exception of Brazil, structures of aldermen or town councillors Ecuador and various Central American (Colombia, Paraguay, Uruguay). countries, the majority of regional and national associations of municipalities in The governors of provinces and states, Latin America were established between and more recently of regions or depart- 1980 and 2000 (see table 6). ments, create their own organizations, such as CONAGO in Mexico, and the In some countries, the associations enjoy National Conference of Governors in a legal status recognized by national legis- Colombia. At the end of 2004, the Latin lation (Argentina, Bolivia, Ecuador, Colom- American Organization of Intermediate bia, Paraguay, Uruguay). However, their Governments, OLAGI, was set up, bring- representative and institutional capacities ing together governors, intendentes, pre- are uneven. In general they offer advisory fects and regional presidents from 14 services, information and training, main- Latin American countries that administer tain contact with the governments and intermediate governments. channel resources from international coop- eration. Many of them have incipient insti- A number of local-government women's tutional structures. organizations have been formed in Latin America, including: the Association of In some countries, the associations enjoy a legal status Women Councilors of Bolivia (ACOBOL); the National Association of Women Coun- recognized by national legislation. The majority of countries cilors and Mayors of El Salvador also have sub-national associations of regional municipalities (ANDRYSAS); the Ecuadorian Association of Female Municipal Employees (AMUME); and the Paraguayan Network of Women in The Latin American Federation of Cities, Municipal Government (RMMP). In other Municipalities and Local Government Asso- countries, there are organizations operat- ciations (FLACMA), whose roots date back ing at sub-regional levels, such as the to 1981, brings together the majority of Network of Women Councilors of Ayacu- national associations in the region. In cho in Peru. Additionally, a bi-annual Con- addition, two sub-regional organizations gress of women mayors and councilors is operate: FEMICA with the six national held within the organizational framework associations of Central America (AMHON, of the Chilean Association of Municipali- AMUNIC, AMUPA, ANAM, COMURES, ties. In 1998, the Latin American and UNGL) and the Mercocities Network with Caribbean Federation of Women in Local 181 associated cities in Argentina, Brazil, Government (FEMUM-ALC) was set up; Paraguay, Uruguay, República Bolivariana the organization is linked to FLACMA. de Venezuela, Chile and Bolivia. Recently, a network of Andean cities has been set V. Achievements, Limitations and up, and COSUDAM, another organization Perspectives on Decentralization made up of local government associations, was established. Although progressive and sometimes contra- dictory, the decentralization and strengthen- The majority of countries also have sub- ing of the municipalities and intermediate national associations of regional munici- governments of Latin America is a reality. In palities. Bolivia's FAM is, in fact, a fe- just over two decades, there have been deration of departmental associations of important achievements. municipalities. There also exist associa- tions of indigenous mayors (AGAAI in Gua- · Election by the people of local authori- temala, Coordinator of Alternative Local ties has become common, changing the Governments in Ecuador) and associative way that parties operate, bringing LATIN AMERICA Decentralization and Local Democracy in the World 201 about renewal of leadership and trans- · In various countries, such as Bolivia, forming the municipality into a space in Brazil, Chile, Colombia and Ecuador, which leaders are formed, from which the positive results attained through various Presidents of the Republic have decentralization are reflected in the already emerged; increases of local investment, ex- tension of basic services, improvement · Multiple constitutional and legal in human development indicators, reforms have transformed the states, decrease in poverty and broadened with competencies and resources being citizen participation. transferred to sub-national governments, although not always with clear strate- However, the decentralizing process shows gies and methods; gaps and faces obstacles, such as: · Sub-national resources have increased · Unequal relations and frequent subordi- significantly, although unevenly, and nation of the intermediate entities and the average decentralized continental municipalities to the central govern- expenditure has risen from 11.6% in ments, heightened by the increase in 1980 to 18.8% of total government fragmentation and municipal hetero- expenditure between 2002 and 2005; geneity; A bi-annual Congress of · The new responsibilities of the local · Gaps between the proliferation of legisla- governments translate into progressive tion and weakness in its application, womenmayors institutional development ­ though which may be attributed largely to pre- and councilors is uneven ­ where some municipalities vailing political and institutional cultures; stand out because of their capacity for held within the initiatives and innovation, while others · Limited financial capacity of local go- organizational still cling to their traditional structures vernments, because of central resist- and practices; ance to handing over resources in a framework context of macro-economic instability, of the Chilean · The local spaces for civic democracy lack of financing policies and adequate have given rise to new experiences of credit, citizens not used to paying for Association of participation by citizens, such as the subsidized services, but also because of strategic participation plan and partici- the lack of political will to strengthen Municipalities patory budgets; the local capacity to collect taxes; · Experiences in municipal de-concentra- · Low efficiency of many local adminis- tion or decentralization have also been trations in delivering services, because developed to share management with of the absence of human resource poli- the communities and open spaces to cies and bad handling of personnel groups that were previously marginal- (rotation, lack of career paths), result- ized (indigenous populations below the ing in a low level of efficiency and pro- poverty line); fessionalism in local personnel; · The new responsibilities of the local · Limitations in civic participation in de- governments and the transformation velopment management due to a lack of relations with the national govern- of adequate financial and local human ments are expressed in the creation resources, poor adaptation of central and strengthening of the national and laws and policies, and difficulties in regional associations of local authori- organizing and mobilizing the actual ties; communities. LATIN AMERICA 202 Decentralization and Local Democracy in the World The decentralizing process in Latin Amer- the local, regional and state levels, gener- ica has shown diverse and contradictory ate tensions between the municipal and signs, and is passing through a moment of departmental levels. In the framework of uncertainty. In big countries like Brazil, the current Constituent Assembly, the to- there is a need to review the federal pact pic of decentralization and regionaliza- and transfer policies in order to deal with tion is at the heart of the national politi- the growing cost of the new responsibili- cal debate. ties of education and health. However, in Peru, Ecuador and the Domini- In Argentina, party political centralism con- can Republic, intended constitutional tinues to be a limiting factor for local auton- reforms have positive implications for local omy, particularly at the provincial level. In governments. In the Dominican Republic, República Bolivariana de Venezuela, it is a new Law of Presupuesto Participativo or feared that the government will intervene Participatory Budget has been passed, and increasingly in the provincial states and a new Municipal Law is expected. municipalities, cutting down their autonomy. Meanwhile, in Chile the national govern- In Mexico, where democratization of ment and the Chilean Association of national and local political life has made Municipalities are negotiating a new Munic- significant advances, strong pressure per- ipal Reform to increase the responsibilities sists on the federal government to move and resources of the municipalities with forward with questions of federalism and the hope of stimulating local development decentralization. and reducing social and territorial inequal- ities. In some unitary states, this process has been slowing down. In Colombia, local In those countries with more incipient government spending is controlled in processes, the situation seems stable. In order to reduce the fiscal deficit of the Paraguay, control from central govern- central government. During the last ment continues to be decisive in the years, decentralization has not been action of the sub-national governments, intensifying. In Colombia, sub-national although the Paraguayan Organization of expenditure is controlled to alleviate the Inter-municipal Cooperation, OPACI, has deficit of central government, and the presented a project to the national go- decentralization process has not deep- vernment to pass a law reforming muni- ened over the last years. In Ecuador, the cipal legislation. transfer of competencies is at a standstill; local authorities are asking the govern- In Uruguay, various "Intendencias Depar- ment to undertake concrete measures to tamentales" (department executives) insist re-launch the process. In Peru, local that the Local Commissions or Juntas be authorities have shown concern about further strengthened, and propose new recent unwelcome measures taken by the mechanisms of citizen participation. There national government57. is a new bill in parliament for Local Decen- tralization, which intends by 2010 to bring In Bolivia, where local governments now the public administration closer to the peo- 57. Centralized administer half of the national public ple through the municipal authorities in establishment of investment, the rigidity of the transfer sys- towns or villages with more than 2,500 in- remunerations by tem and the overlap of responsibilities at habitants. local authorities, cutting of transfers and centralization of decisions to finance projects. LATIN AMERICA Decentralization and Local Democracy in the World 203 Despite advances in decentralization, Latin America is still a continent with a high degree of political, territorial and economic centralization, exacerbated by concentration in the metropolises and immense social and territorial disparities VI. Conclusion Despite advances in decentralization, Latin control, condition and restrict municipal America is still a continent with a high autonomy. degree of political, territorial and economic centralization, exacerbated by concentra- The decentralizing experiences have tion in the metropolises and immense so- reignited the debate about the impor- cial and territorial disparities. tance of local development for sustain- able and socially equitable development In the near future, new debates are envis- at the national level. The issue of good aged. New centralizing trends have emerged local governance is emphasized and that are curtailing local self-government, understood as a form of territorial self- such as the accreditation of local capacities government based on participatory net- needed in Costa Rica to qualify for the trans- works of local actors, public-private fer of responsibilities and resources. Public alliances and the mobilization of own ter- purchase58, information and monitoring sys- ritorial resources to activate the endoge- tems ­through administrative mechanisms­ nous processes of development. 58. In Chile, Chile Compras, as the only public sector purchasing website, is presented as an example of procedural transparency and rationalization of public purchasing for central government and municipalities. Yet it is not very practical for local governments, as it displaces local providers, favors national companies and slows down the administrative process, to the detriment of municipal responsiveness to the demands of the community. MIDDLE EAST / WESTERN ASIA MUSTAPHA ADIB MIDDLE EAST / WESTERN ASIA 206 Decentralization and Local Democracy in the World MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 207 I. Introduction the West Bank and Gaza, the restoration of The religious factor mayoral elections by universal suffrage in is omnipresent The geographical region of Western Asia/the Jordan, and the 2002 constitutional reforms Middle East encompasses Turkey, the Near in Bahrain. Under pressure from elite seg- throughout East1 ­with the exception of Israel­, the Ara- ments of their populations, Islamic Republic the region, in the bian Peninsula, and Western Asia, including of Iran and Kuwait have also begun tentative Islamic Republic of Iran. The region has, for changes in this direction. Turkey, which has constitution and many decades, undergone political, military, had a modern municipal system since 1930 ethnic, and religious tensions that have and whose citizens as a whole support across private and affected its stability. Of the countries that we decentralization as one of the criteria for political spheres will be examining, seven are monarchies membership of the European Union, is some- (Bahrain, Jordan, Kuwait, Oman, Qatar, Saudi thing of an exception to this description; Arabia and United Arab Emirates), six are three new laws favorable to decentralization republics (Islamic Republic of Iran, Iraq, were adopted in Turkey in 2004-2005. Lebanon, Syria, Turkey and Yemen) and the autonomous territory of Palestine, which has These changes, however, cannot conceal not yet all the attributes of a state. Indeed a broader trend throughout the region Turkey is the only country that has enjoyed ­Turkey excepted­ toward the gradual stability, for several decades, based on secu- confiscation of local authority by central lar and democratic institutions. The religious governments. In certain cases, even the factor is also important and omnipresent tasks of providing street cleaning, sewer throughout the region, in the constitution and maintenance, and public health meas- across private and political spheres. ures, are being taken away from local go- vernments. The most extreme case is This grouping of over 260 million inhabitants Jordan where the provision of 13 differ- is dominated from the demographic stand- ent types of service has been taken back point by Turkey (74.7 million inhabitants) by the state. This form of centralized and Islamic Republic of Iran (69.5 million). control typically involves privatization, The population is now predominantly urban under the pretext of improving efficiency (Syria 50.1%, Islamic Republic of Iran 67%, and overall services. Iraq 67.2%, Turkey 67.3%, Oman 77.6%, Jordan 79%, Lebanon 87.5%, Kuwait Decentralization only appears in the consti- 1. Insofar as there does 96.3%), with the exception of Yemen tutions of Lebanon, Syria, Islamic Republic not exist any (25.6%). But the existence of a few indus- of Iran, and Turkey. Turkey has a middle- generally accepted trialized economies and the wealth gener- level local government, but in the other definition of the ated by oil revenues must not lead one to three countries decentralization applies to terms `Near East' overlook either the huge differences that only the lowest tier, municipalities. and `Middle East,' exist between the countries of the region, or we shall refer to the their sometimes mediocre performances in Apart from the Sultanate of Oman, Saudi former Levant, terms of education, governance, and free- Arabia, and Bahrain, where the roles of the (Lebanon, Syria, the dom ­performances which were highlighted municipal councils have been defined from West Bank and by the 2004 UNDP report. the start as purely and openly consultative, Gaza, and Jordan) legislation in other countries in this region as the `Near East,' and the countries of Nevertheless, in spite of the ceaseless polit- ­ especially Kuwait and Turkey ­ does the Arabian ical, military, and religious tensions, wars grant certain powers to local authorities. Peninsula, Iraq, and and other perennial obstacles to the regions' Islamic Republic of stability as a whole, and certainly to the Nevertheless, the existing laws rarely Iran, as the `Middle development of local autonomy and decen- present a precise list of local powers, such East.' Turkey for tralization, some advances deserve recogni- specifics being the province of future our purposes here is tion: the first local elections in Saudi Arabia, implementation orders promised but never considered part of the holding of democratic local elections in published. The vagueness of such laws Western Asia. MIDDLE EAST / WESTERN ASIA 208 Decentralization and Local Democracy in the World With the exception creates overlapping areas of responsibility supported by civil society. Within the re- in practically all fields. The central govern- gion, the voice of civil society is sometimes of Turkey, local ment uses this vagueness to retain most of hesitant to make its opinions heard, and authorities' limited the powers, leaving municipal authorities this in turn has repercussions for decen- with only derisory duties. tralization and local government. financial independence is Reliance on conveniently vague laws typi- This trend toward centralization has expe- cally results in a paucity of financial re- rienced an unprecedented intensification coupled with sources for local authorities, and the con- since the first Gulf War. In fact, because of a priori comitant restriction of the services local a particularly unstable geo-strategic situa- governments can realistically provide. Apart tion due to the upsurge of armed conflicts, administrative from Turkey, the only economy in which the heightening of community and sectar- control of local local authorities have decent (although not ian tensions and the interplay of interna- large) resources at their disposal is the tional pressure, the governments of the council West Bank and Gaza, where they keep up to region are haunted by the fear of the proceedings, as 90% of the taxes they collect plus income break-up of national entities. This is partic- provided by non-government organizations ularly the case where the ethnic or reli- well as a posteriori (NGOs). In the majority of nations in the gious groups in power are a minority, or region, obtaining money for operations and comprise a very slight majority. In Islamic control of all work services requires unceasing appeals to the Republic of Iran, which is a mosaic of 80 by local authorities central government, or to the organizations communities, 51% of the population is that manage national finances. One result: Persian; in Lebanon, 18 communities, each increasing levels of debt. with a different religion, live together; Jor- dan has a very strong Palestinian minority; A single figure is enough to describe the and several countries in the region have a scale of the problem. Whereas the local large Kurdish community. government share of public expenditure represents 20% of the gross domestic II. Evolution of Local Government product (GDP) in OECD countries, money Structures for local government averages only about 5% of GDP in the Arab countries. The following table presents local govern- ment organization in the region. Furthermore, with the exception of Turkey, local authorities' limited financial inde- Before going further with an analysis of the pendence is coupled with a priori adminis- region's governmental structures and their trative control of local council proceedings, recent evolution, it is necessary to empha- as well as a posteriori control of all work by size that Turkey is unique in this part of the local authorities. Together, these two mea- world. Turkey is included in this study of the sures ensure complete control of local po- Near East and Middle East because of its wers by central government. geographical location at the gates of the Levant, and its majority Muslim religion. By contrast with Turkey, there is, in Islamic However, as Yves Lacoste has stressed, Republic of Iran and Syria, `cascading' super- "The North-South model experiences a vision of lower councils by higher councils. In stumbling block in the very exceptional case the West Bank and Gaza repeated outbreaks of Turkey"2. Turkey is a secular state adja- of violence often make it impossible to sub- cent to Europe, but most of its residents are mit matters to the central power, leaving Islamic. Turkey is geographically part of the 2. Yves Lacoste, local authorities with de facto autonomy. Middle East; its topography affects many Géopolitique, Middle Eastern states, and has done so for Larousse, 2006, Local governance is underpinned by local countless millennia. Within the framework p. 227. democracy, which is itself boosted and of a secular state, Turkey is relatively cen- MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 209 Table 1 Administrative Organization Country/ Population / land area Political regime Federal entities or Second tier Local level territory autonomous regions Bahrain 0.727 m 690 km2 Constitutional monarchy Municipality (12) GDP (per capita): 14,370 USD* Iran , Isl. Rep. 67.7 m 1,648,200 km2 Islamic republic Province (28) City/town (931) GDP (per capita): 2,770 USD Department (314) Small town Village Iraq 26.5 m ** 438,320 km2 Parliamentary republic Kurdistan Region Municipality GDP (per capita): 928 USD*** Governorate District Jordan 5.4 m 88,800 km2 Constitutional monarchy Governorate (12) Municipality (99) GDP (per capita): 2,500 USD Kuwait 2.5 m 17,818 km2 Absolute monarchy (Emirate) Governorate (5) Municipality GDP (per capita): 24,040 USD* Lebanon 3.6 m 10,452 km2 Parliamentary republic Region (6) (Mohafazah) Municipality (930) GDP (per capita): 6,180 USD Department (Caza) Oman 2.6 m 309,500 km2 Absolute monarchy (Sultanate) Municipality (43) GDP (per capita): 9,070 USD* Qatar 0.813 m 11,000 km2 Absolute monarchy (Emirate) Municipality (10) GDP(percapita):28,833USD*** Saudi Arabia 24.6 m 2,149,700 km2 Absolute monarchy Province (13) Regional council (7) GDP (per capita):11,770 USD Governorate Principal council (5) Center (A or B) Council (107) Group of villages (64) Syria 19 m 185,180 km2 Authoritarian presidential Department (14) Town (107) GDP (per capita): 1,380 USD republic Small town (248) Village (207) Rural unit Turkey 72.6 m 783,820 km2 Parliamentary republic Special departmental Municipality (3,519)3 GDP (per capita): 4,710 USD administration (81) 16 Metropolitan Municipalities Village (35,000) United Arab 4.5 m 83,600 km2 Federation of absolute Emirates (7) Municipality Emirates GDP (per capita): 23,770 USD* monarchies (Emirates) West Bank 3.5 m `Palestinian Authority' Governorate (14) Municipality (74) and Gaza 5,842 km2 (The West Bank) (9 in the West Bank (63 in the West Bank +365 km2 (Gaza Strip) 5 in the Gaza Strip) 11 in the Gaza Strip) Yemen 21 m 527.970 km2 Authoritarian presidential Governorates Municipality (326) GDP (per capita): 600 USD republic Provincial municipality (20) District municipality (326) Source: World Bank 2005, except: * Source: World Bank 2004. ** Source: World Bank 2003. *** Source: World Bank 2002 3. Beside these ordinary municipalities, the metropolitan municipalities provide urban services at the metropolitan level to ensure greater efficiency, as well as harmonization and coordination between municipal districts. The metropolitan municipalities supervise and provide assistance for district municipalities. MIDDLE EAST / WESTERN ASIA 210 Decentralization and Local Democracy in the World Turkey is the only tralized, but its local government system is U.S.A. policy in the region. The United Sta- pluralist secular subject to a constitutional jurisprudence tes maintains a military presence in the re- that is extraordinary in the region. gion, particularly in Iraq. The promotion of democracy, the principles of « good governance » and Turkey is the only pluralist secular demo- democracy have become the declared US and has always cracy, and has always attached great im- policy in the region. With the on-going attached great portance to developing its relations with support of different countries, the United European countries. Historically, Turkish States sustains its regional policy through importance to culture has had a profound impact over direct and indirect means. developing its much of Eastern and Southern Europe. Af- ter the First World War and the proclama- Economic pressures. Along with political pres- relations with tion of the Turkish Republic in 1923, the sures and within a context of neoconservative European countries Kemalism, to which the present Turkish globalization, the non-petroleum-producing state is heir, deliberately distinguished its countries ­ Lebanon, Jordan, and Palestine ­ political and social system from that of the face demands from international backers for Arab countries. This was particularly em- the restructuring, not only of their weak phasized by the abolition of the Caliphate economies, but also of their societies. The and the adoption of the Latin alphabet, strengthening or the establishment of local modified only slightly4. Turkey's modern government is one of the pillars of these democratic conception and acceptably reforms in that it constitutes the first step in functional institutions present more con- applying the principles of good governance. trast than similarity to other Middle Eastern nations. This contrast is no less apparent in b) Internal factors regard to decentralization. Internal population pressure. Although ci- II.1. The Objectives of Decentralization vilian society is not accustomed to making its voice heard, there has recently been an By means of constitutional and legislative increasing demand for local democracy by reforms during the past ten years, all the two groups whose interests converge only countries in the region have embarked in this single area. Both appear to see in upon a change of direction toward moves toward democracy the means of increased administrative decentralization. bringing victory to their overall concept of However, far from being uniform, the the state. One group, often referred to as underlying motives and results are quite radicals, wants a more rigid system of go- different and wide-ranging. vernment. The other group, the intellectual elite, wants to establish real democracy. An a) External factors example of this urging toward democracy is the 100 Saudi intellectuals who in January Membership of the European Union. As a 2003 presented the Crown Prince with a peti- country where decentralizing reforms are tion requesting changes; similar pressure led increasing in scale, Turkey has been moti- the Jordanian government to restore the vated by its desire to gain membership of election of mayors by universal suffrage. the European Union, whose criteria for 4. These reforms also membership include respect for human Coming to terms with demands for auto- fell within the rights. It is therefore within the framework nomy. In the specific case of Iraq, where in- framework of the of the European Charter of Local Self-Go- ternal pressures are nationalist in nature, `Six Arrows' as vernment, signed in 1988 and ratified in decentralization has enabled the granting of Ataturk's general nationalist policy 1992, that this wide-ranging renovation of extensive autonomy, including legislative po- aimed to ensure the state structures ­ including new local go- wers, to Kurdistan. However, these powers modernization of vernment laws and constitutional do not grant or imply independence for that Turkey. changes ­ is taking place. region. MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 211 The need for economic restructuring. With II.2. Encouraging Progress the exceptions of Turkey, Lebanon, Jordan, and Yemen, the economies of the region are In Turkey, where the decentralization based on oil; only Syria and Turkey can be process is most advanced, three new considered industrialized countries. reforms6 were passed in 2004-2005. Fur- thermore, the 2005 union of municipali- Yet the exhaustion of oil reserves in the near ties' law7 will finally make the villages a future appears likely5. The governments of real tier of decentralization. It is now pos- oil-producing nations are therefore trying to sible for the local authorities, on their own anticipate a profound structural change in initiative, to organize referendums on spe- their economies to facilitate rapid expansion cific local issues --an interesting system of of private initiative. This concerns Syria in direct democracy. particular. Dubai, which does not have any oil, but which benefits from oil revenues Likewise, Iraq's 2004 constitution establi- through the federation of the Emirates, re- shes decentralization as a priority, (Iraq's presents a striking example of success in 1990 constitution did not) devoting an this type of restructuring. entire chapter to "regions, governorates, and municipalities." This document sanc- 5. On this subject, it is Restoring impetus to governance in ge- tions the autonomy of Kurdistan, which interesting to neral. After almost 30 years of system- becomes a "region" with a regional govern- compare the official atic destruction of Palestinian state ment, parliament, and judicial authority. figures provided by structures by Israel, the Palestinians, Moreover, it encourages the creation of the governments according to the 1993 Oslo Accords, regions by the grouping together of gover- and the large oil wanted to set their state structures back norates. In addition, and in contrast to companies with on their feet in order to construct a state. other countries of the region, except those provided by However, as it is impossible to establish a Turkey, where administrative decentraliza- ASPO. real central government inasmuch as tion (déconcentration) and delegation pre- 6. Onthemunicipalities there is no territorial continuity between vail, Iraq's new constitution organizes (no. 5393 of 3 July the West Bank and the Gaza Strip, the decentralization on the basis of the admin- 2005), on the only way of providing services to the istrative and financial autonomy of local metropolitan people and to enable them to take effec- authorities, including regional and muni- municipalities (no. 5216 of 10 July tive action regarding the affairs which cipal councils8. 2004) and on the concern them is through the local gov- special ernments. This removal of central Following this same trend, in 1999 Islamic administration of authority has greatly increased public Republic of Iran finally achieved a long- the department (law confidence and trust in local Palestinian standing reform: the elections of councils. no. 5302 of 22 government, the institution closest to its This reform was first presented as far back February 2005). citizens. as the 1907 Constitutional Revolution, and 7. Lawno.5355of26 was again championed after the revolution May 2005. It is surprising that providing better public of 1979. Some 92 years after it was first 8. In actual fact, this is services is mentioned as a concern only in proposed, this change took effect under only really applied in Turkey. One explanation may be that, for the presidency of the reformer Khatami. the north, in this purpose, administrative decentraliza- Kurdistan. Elsewhere, the local tion (déconcentration) in Saudi Arabia, and Another important reform is currently in authorities only a rather authoritarian management are progress in Jordan, a country whose king enjoy a weak level perceived as quite effective. In fact, the has made good governance principles one of autonomy, and it management of the city of Dubai, which is of the national objectives. This reform is not uncommon to a resounding success in terms of town aims to divide the country into three find that municipal planning, infrastructure, economic deve- regions, each of which will have its own councilors and lopment, and service provision, results so- regional parliament as well as local man- mayors are lely from the will of the Emir. agement of its own affairs. appointed directly. MIDDLE EAST / WESTERN ASIA 212 Decentralization and Local Democracy in the World Lebanon used to have properly functioning in 2002, states that13 the law "will do so as municipal governance, but this lost all sub- to ensure the independence of local author- stance during the 1975-1990 war, as secu- ities under the supervision and direction of rity concerns led to the centralizing of all the State," and "will do so as to ensure that services within the different ministries. the local authorities are able to manage Executive power was concentrated9 in the and supervise local affairs." In Saudi Ara- office of a President of the Republic, who bia, the first election of half the municipal was always a Maronite Christian. However, councilors was organized in 2005. at the end of the war, the Taëf Pact, a con- stitutionally valid document signed to put an Yet in Turkey the reform of the executive end to the war, made more room for all committees (encümen) ­the entities communities. In the first place, executive responsible for municipal management­ power passed to the Council of Ministers, still raises concerns. In fact, each tier of whose members represent different faiths in decentralization ­Special Provincial Admin- proportion to their demographic importance. istrations (SPA), ordinary and metropolitan The document also mentions administrative municipality and village­ has a deliberative decentralization as one of the main areas for body called a council, which is elected by reform, thereby distinguishing itself from universal suffrage. At the municipal and the constitution, which does not mention it village level, the executive officer (the at all. The new accord directs that "a more mayor or the Muhtar respectively) is also extensive decentralization be adopted at the elected by universal suffrage. On the other level of the smallest administrative units"10 hand, at the top provincial level is a gover- and that "the municipalities, agglomera- nor appointed by the state. Moreover, each tions, and unions of municipalities see their council works in conjunction with an exec- resources strengthened by the provision of utive body called the `executive commit- the necessary financial resources"11. Within tee.' Before the reform, this executive this framework, it became far easier for local committee was fully appointed in the me- communities to voice their demands for a tropolitan municipalities, fully elected in greater degree of self-government; the cre- the SPA and half was elected and half was ation of 25 municipalities since 2004 tes- appointed in the ordinary municipalities. tifies to the acceptance of this reform at high The new legislation directs that, without levels of the Lebanese state. exception, half of all executive committees must be elected and half must be appointed. In a similar case, the Palestinian Authority, Although this measure is based on a man- which was formed as a result of the Oslo agerial vision of local government man- 9, Lebanese constitution, art. 17. Accords, was especially keen to proceed agement, the presence on an executive 10. Taëf Pact [III : A, with the strengthening of local government. committee of members appointed by the art. 3]. The population naturally made these bodies mayor or the governor runs counter to the 11, Id. Art. 4 its favorite forum for public expression of full exercise of local democracy and decen- 12. Maire de quartier. demands, including practical requests tralization. It is, moreover, the interpreta- This institution regarding services. All this was in a situ- tion that the Turkish Constitutional Court exists in many Arab ation where the increasingly weak states, or gave of it14 in 1988: all deliberative bodies countries, including the mokhtars12, who had lost the confidence must be elected. It is therefore not impos- Lebanon. of the population because of their suspect sible that these texts will be amended in 13, Art. 50. role during the occupation, were not in a the near future. 14. Notice no. 1988/23 position to ensure the provision of services. of 22 June 1988 and As viable power centers, these municipali- Likewise, according to the new law15, the decision no. 1988/19 of 13 June ties are becoming increasingly autonomous. SPA council now elects a chairman from 1988. among its own members. Although this 15. Law no. 5302 of 4 Two other cases also deserve mention. In chairman is responsible for the council agen- March 2005, art. 11. Bahrain the new constitution, promulgated da, it is the governor who stays at the MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 213 head of the executive committee and who governor; in Bahrain, Oman, and Lebanon represents the SPA16. up to 80% of the decisions must be checked by the Ministry of the Interior, or by a gov- In Islamic Republic of Iran, the new law ernor with regional executive powers. regarding councils, which was adopted at its first reading by the Islamic Consultative Other governments practice a more insidi- Assembly, also seems intended to restrict ous form of control. Under the guise of a the councils' room to maneuver. nominal freedom to make decisions, an arsenal of measures appreciably limit the decision-making powers of local authori- II.3. The Persistence of the Centralized ties. Model `Cascading supervision.' In Syria and Islamic a) Central state supervision Republic of Iran, there is `cascading supervi- sion' of lower-tier councils by higher-tier These advances toward further decentral- councils. In Islamic Republic of Iran, the ization are quite significant, even though, constitution specifies, moreover, that "the for the most part, they are still reforms on provincial governors and the mayors [...] paper or are restricted to administrative must apply, within their jurisdiction, the decentralization only. Most such reforms decisions of the Higher Provincial Council"17, still await the fiscal and economic decentral- a fact that clearly calls into question public ization that is essential for their implemen- professions of a desire for decentralization. tation. Consequently, the standard system of government in the region remains The executive committees. Two countries strongly centralized. Moreover, it bears have, in addition to local councils, municipal mentioning that some countries, such as legislative bodies vested with executive Oman and Qatar, do not even mention local powers; these are called executive commit- powers in their constitution. In Saudi Ara- tees in Turkey, executive bureaux in Syria. bia, provisions for local governance are also While the members of local councils are 16. Id. Art. 25 et 29. absent from the constitution; instead, they elected by the people, the members of 17. Art. 103 `Of the are specified in a separate text, the 1992 executive committees or the executive bu- power [of the Higher Provincial Council] `law on the provinces.' Even this document reaux, are appointed by more or less direct on local does not deal with municipalities. Rather it procedures18. In Turkey, the constitution19 government.' addresses only provinces, all of which are defines local authorities as bodies that have 18. In Turkey, the controlled by princes of the royal family. a legal personality, and whose legislative appointed half of the bodies are elected. This, in fact, opens the executive council is Independent decision-making by local way to the election of all or part of the selected by the authorities is allowed in Turkey, the West members of the executive committees, as mayor from among Bank and Gaza, and Iraq, but in other coun- much at the Special Provincial Administra- the municipality's tries in the region, real decisions are made tion level as at the municipality level20. chief officers, within only by higher authorities, either a single the framework of designated official or some lesser officials Syria's case is slightly different. There a the `strong mayor holding power through a complex of arcane third of the members of the executive system.' 19. Art. 127. laws. Where there is a clear, single channel body can be recruited from outside the 20. The Turkish of authority, municipalities are subject de municipal council ­on the basis of criteria Constitutional Court facto and de jure to government authority which are far from clear. has ruled that the through their relevant ministry. This is the executive councils case in Saudi Arabia, where local authorities The ambivalent role of popular councils. In are governing are dependent on the Ministry of Rural and addition to the municipal councils, the bodies and that their Municipal Affairs. In Jordan, little can be mahalle muhtarligi (neighborhood coun- members must be done without the backing of the territory's cils) chaired by a muhtar have existed in elected. MIDDLE EAST / WESTERN ASIA 214 Decentralization and Local Democracy in the World Turkey since the Ottoman Empire. They slow, particularly because of the uneven are very similar to the Lebanese mokhtar. level of involvement in decentralizing re- The role of these local community leaders forms."22 In fact, it is difficult not to see in was made official by Article 9 of the new the persistent strong centralization a municipal law.21 This law gives them offi- reluctance on the part of the governments cial functions, notably in the field of the of the region to accept local governance registration of births, marriages, and and the independence inherent therein. deaths, and in tax collection. In addition, they ensure contact with the municipality The refusal of a loss of sovereignty. The and represent their local community area main reason for government distrust of lo- on the `town councils' by passing on the cal governance is fear of a loss of sover- requests and comments of the people from eignty. Excluding Turkey, where power their administrative area. Introduced by belongs to the institutions, governing tra- the new municipal law, the "city council" dition is based on the personal exercise of ­kent konseyi­ is a consultative institu- power, with the government, on its own tion, an outcome brought by the success of initiative, delegating a part to people of its the Turkey Local Agenda 21 Program. This own choice. Given this context, to put in constitutes a unique mechanism of gover- place real decentralization would require a nance in Turkey that brings together the complete overhaul of state structures, central government, local government and beginning in some cases with a separation civil society within a framework of partner- of powers and election of legislative bodies ship. In general, this participatory mecha- by universal suffrage. nism encompasses a broad spectrum of local stakeholders, representatives of In the particular case of Lebanon, which working groups, neighborhood commit- nevertheless satisfies these conditions, the tees, women and youth councils. only area of agreement of the traditional community leaders is their wish to put a In other countries, however, authorities brake on the resumption of municipal go- working in parallel with the municipal vernance. In fact, they consider local mu- council can represent an important opposi- nicipal authorities to be usurping some of tion force in the hands of the central go- their prerogatives. They seem to believe vernment, particularly when they have the that municipal authorities are only potential to report on and perhaps slow intended to provide services for their sup- down the work of the municipal councils. It porters in exchange for their votes. This is this second situation which applies for vicious circle keeps the local councils in a the Syrian `popular organizations,' which state of lethargy. Members of parliament, represent various socio-professional cate- who are themselves traditional leaders or gories, such as manual workers, farmers, who owe allegiance to them, use their leg- and women, and which must make up at islative position to gradually weaken the least 60% of local councils. Furthermore, power of the municipalities. 21. Law no. 5393. their elected representatives, even those 22. ELISSAR SARROUH, not on the municipal council, have the This analysis is equally valid for those Decentralized right to monitor their activities. states where members of the ruling fami- Governance for lies, or those of a political party, or of a Development in the b) The weight of the political dominant movement have all the power. Arab States, report and social system presented during The security factor. The other factor which the forum on governance in the The report of the United Nations Develop- hinders the decentralization of the states is Arab states, Sana'a, ment Programme (UNDP) indicates that security. Some large fault-lines cross the 6-9 September "the progress in the field of decentraliza- region, the main one being the community 2003. tion in the Arab countries has been very organization. In fact, the risk of subversion is MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 215 far from negligible in those states with a large jurisprudence will be one of the main Shiite community, as in Saudi Arabia, Iraq, sources of legislation." The exceptions are and Bahrain. Neither are Islamic Republic of Turkey and Iraq, which are secular states, Iran, Lebanon, and Iraq safe from implosion. and Lebanon, where a hybrid system entrusts private legal matters to the reli- The inertia of civilian society. Again excep- gious tribunals of each religious commu- ting Turkey, those in power are not alone in nity, Christian or Muslim, but takes as its their indifference to decentralization. In the basis secular business and public law. general population, it is mostly identifiable groups who desire increased decen- The original feature of Islam in comparison tralization. Such groups include the cultured with other religions is that it provides guid- urban elite, extremist parties, and those ance not only on private life, but also on who see it as a means to autonomy or even the system of government. This, however, sovereign independence. does not mean that its interpretation is totally unequivocal, and the two famous Civilian society reduced to its most simple ayets --"Consult them in the affairs which expression is typically comprised to a concern them"23 and "Let them consult greater or lesser degree of client net- each other"24-- gives rise to a wide range works, which are perceived as being more of interpretations. It is on the narrowest of efficient and more reliable than the state, these interpretations that Saudi Arabia, sharp divisions among different cultural Bahrain, and Oman have based their deci- and religious communities, and a wide- sion to replace the legislative bodies with a spread tradition of submission to central consultative assembly, the Majlis-al-Shu- authority. Indeed, in this region the desire ra; the same ayets have, on the other for freedom is embodied far more in reli- hand, given rise to the election of councils gion than in politics, suggesting that the in Islamic Republic of Iran and Jordan. larger citizenry plays an insignificant role as a driving force for change. Evidence for The perception of a supranational identity. this is the absence of political parties in With the exception of Oman and Turkey, all six of the 14 countries studied (Saudi Ara- the countries of the region claim in their bia, Bahrain, the United Arab Emirates, constitutions to be an "Arab nation," Kuwait, Oman and Qatar). In Jordan, (Bahrain, Jordan, Lebanon, Kuwait, Qatar, political parties were not legalized until Syria, and Yemen), or an "Islamic nation" 1992. Further support for the weakness of (Islamic Republic of Iran); both in the case political systems for expressions of popu- of Saudi Arabia. This is seen as the ulti- lar will can also be seen in the rapid mate goal toward which the national struc- expansion of radical religious movements. ture would be a stage. It is a question of It is through religious organizations that the translation into political terms of the we receive calls for reform, the popular sense of belonging to the Umma (the com- expression of demands that can not be munity of Islamic believers). This mythic voiced successfully by political means. identity would in no case succeed in result- ing in a federal reality, but it tells us a good The influence of the religious factor. Most deal about religious aspirations and about of the countries in the region base their the dominance of the group over the indi- legislation on the Sharia. This is the case vidual, and of global over local policy. of Saudi Arabia, (Const. art. 1), Bahrain (Art. 2), Islamic Republic of Iran (Art. 2), Between necessary change and an inward- Jordan (Art. 2), Kuwait (Art. 2), Oman looking identity: Most of the countries of (Art. 2), Qatar (Art. 2), and Yemen (Art. the region are recent in origin, and are 3). The Syrian Constitution establishes a currently grappling with two major trends: 23. Koran,[3:159]. slight nuance by indicating that "Islamic the wish for change and modernization, 24. Koran,[42:38]. MIDDLE EAST / WESTERN ASIA 216 Decentralization and Local Democracy in the World and the influence of Islamic movements. the different municipal councils that make Caught in the crossfire between globaliza- up the metropolitan municipality. If this tion and an inward-looking identity, and reform has indeed successfully strength- faced with real threats of destabilization, a ened the metropolitan municipalities' number of leaders prefer to play the stabil- range of activities, some balance remains. ity card to the detriment of structural On one side, a mayor elected by direct uni- reforms ­ all the more so because such versal suffrage; on the other, the presence reforms are sometimes perceived as being of members of the first-tier ordinary encouraged by the West. municipality councils within his council. In other countries, there is no special sta- II.4. Specific Structures for tus for big cities, although this has been the Organization discussed, but never undertaken in Jordan. of the Metropolitan Cities Only Amman, Beirut, and Damascus have The region of Western Asia/Middle East en- special status, and this only in matters of compasses 28 big cities of more than a security. Their municipal councils are million people25. In 2006 these cities essentially deliberative bodies with no real 25. In decreasing order together had 77.14 million people which power. of their population in represents 37% of the whole population of 2006: Tehran, the region26.The metropolis experienced a Regarding the organization of metropo- Istanbul, Baghdad, very fast growth: 10.6% between 2005 and lises, some are based on a hierarchical Riyadh, Ankara, 2006 compared to only 2.56% experienced model, e.g. a central municipality vested Ispahan, Jeddah, Amman, Izmir, Alep, by the population of the whole region. with the executive authority and lower Mashed, Damas, level municipalities the functions of which Kuwait, Beirut, Only Turkey in 1984 granted its major are mainly licenses (such as delivering Sana, Mosul, La cities the special status of `metropolitan building permits) and administrative work. Mecca, Damn, municipalities,' a status that was reformed This is the case, for example, in Amman. Dubai, Tabriz, in 200427. Turkey's 16 metropolitan munic- Others follow a "horizontal" model, with Bursa, Gaza, Basra, ipalities have a total population of 25.9 equal status, as for example Mashad in Shiraz, Andana, million inhabitants ­38% of the country's Saudi Arabia. Gaziantep. Qom and total population. Ahvaz. However, in most cases there are big cities 26. In Yemen 8% of the This special political status enables Turkish with a municipal council vested with exec- population, in Syria cities to be run with comparative effi- utive and legislative functions; there exist and in Islamic Republic of Iran ciency. Big cities are divided into two lev- sometimes inner city district municipali- 25%, in the els: the proper metropolitan municipality, ties, whose status goes from pure execu- Emirates 30%, in and the ordinary first-tier municipalities. tive bodies (Tehran) to consultative bodies Iraq 37%, in West The metropolitan municipality is responsi- (Baghdad). In this case, surrounding munic- Bank and Gaza ble for urban services: urban planning, ipalities located in the metropolitan area 38%, in Saudi large parks and green areas, collection and are subject to the regional authority (re- Arabia 43%, in disposal of household and industrial gion or governorate). Jordan 46%, in wastes, water, sewerage, natural gas and Lebanon 55% and in public transportation, establishing and The case of Dubai is exceptional. The mana- Kuwait 72%. operating marketplaces for wholesalers gement of the city has been devised as for Bahrain, Oman and and slaughterhouses, sports, leisure and an enterprise, the head of which is a ge- Qatar don't have large recreation areas. neral director. any city of more than one million inhabitants. Nevertheless, the latest reform was keen It is clear that, apart from the exceptions of 27. Law no. 5216 of 10 to encourage coordination and cooperation Turkey and some cities elsewhere, such as July 2004. between the two levels, as well as among Amman and Dubai, the exponential deve- MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 217 lopment of metropolises has taken authori- accounting data. Jordan has become a ties by surprise. Most have to establish an member of the International Monetary urban planning considering all aspects of Fund's Government Data Dissemination this expansion, in particular socio-economic System and has started to communicate aspects. verifiable data. Saudi Arabia and Oman ha- ve also started to publish their accounting data, and Turkey has achieved remarkable III. Responsibilities, Management transparency, partly due to government and Finances efforts and partly because of a citizens' ini- tiative called `Society Follows the Budget.' III.1. Local Authority Finances The weakness of local taxation. In Turkey, The lack of reliable data and the issue of local expenditure amounts to 4% of the transparency. First, it must be acknowled- Gross Domestic Product (GDP), 75% of this ged that obtaining reliable up-to-date data share goes to the municipalities and 25% to on the finances of local authorities in this the SPAs. This is the highest share of GDP region is a formidable challenge. Several in the region, except Jordan (which is 6% factors limit accessibility to pertinent data: according to UN-POGAR). Practical obstacles to data collection: In Turkey, the Constitution and the laws · The lack of reliable data compiled in require the national government to con- accord with international standards; tribute to the financing of local functions. international organisations have not State funding covers little more than 50% been able to publish comparative data of municipal budgets; 55% of these state on public finance in relation to the funds represent a 6% share of national countries examined in this report. taxes, redistributed to the municipalities in · Lack of training for municipal employees proportion to their population. Moreover, in the principles of accountancy and in the metropolitan municipalities receive a the exacting standards of accurate share of 4.1% of the taxes collected in the book-keeping. region, revenues which in turn are redistrib- · Lack of computerization of data, al- uted to the metropolitan municipality itself though some countries are on the right (55%) and to the municipalities (35%). A track. further 10% is allocated to water and sani- · In the case of the West Bank and Gaza, tation. In addition, 15% of the municipal the destruction of the archives by Israel. budget is paid as subsidies from the various ministries. National government subsidies Informal obstacles: and transfers assure a more balanced distri- · A tradition of secrecy that pervades the butionoffinancialresourcesamonglocalgov- entire region. ernments throughout the country. · Lack of cooperation from some munici- pal officers. The share of local taxes, those collected within the municipalities' own financial re- Few national governments in this region source base, remains rather small, reach- have demonstrated sufficient concern about ing only 12.4%. To that are added various accounting practices to cause a discernable taxes paid directly by the municipalities, decline in the widespread public perception including taxes on property ownership, of corruption. However, some progress is gambling, public shows and activities, as apparent in a few countries. In Lebanon, well as on electricity and gas consumption. Prime Minister Fouad Sanioura introduced Although small, this local share of tax rev- an annual independent audit of all the mi- enue collected locally has been increasing nistries, along with the computerization of since 1988. MIDDLE EAST / WESTERN ASIA 218 Decentralization and Local Democracy in the World The system's stumbling block is that As we mentioned earlier, this is partly due local authorities have no taxing rights, to weak or non-existent local taxing po- with the exception of the tax on property wers. The second problem is the low level ownership, because they are members of of state subsidies, which are haphazard the committee that fixes the tax base. and arbitrary. Most of the time, state fund- All the rates, including those for the ing barely covers operating expenses property ownership tax, are fixed by the ­ sometimes not even that ­ in economies central government, in accordance with such as Jordan, Lebanon, and the West article 73 par. 3 of the constitution, Bank and Gaza. This does not leave much which states that "All types of taxes and leeway for investment potential or the rights are to be established by the law," financing of cultural and social activities. and that the Council of Ministers can be For that the municipalities have to rely on empowered by law, and within the limits the good will of wealthy locals ("evergets") laid down by law, to fix the exemptions, or people living abroad. There are even reductions and rates. Between 1980 and local authorities that are so deprived of 1990, the Constitutional Court delivered decent resources that the mayors are paid several rulings which interpreted these by central government, and all the serv- constitutional provisions as meaning the ices are provided by other bodies. termination of any local authority taxing right. Moreover, the financing of local authorities is under no circumstances considered to A bill currently under consideration predicts be a priority; services such as health, edu- an increase in municipal and SPA revenues cation, civil engineering, and water and as well as a real equalization; however, it power supply, are run either by the min- stops short of granting taxing rights to these istries or by centralized sector-based bod- bodies. ies. In Islamic Republic of Iran, the pres- ent law on municipalities does not even In Lebanon, own taxation only reaches mention finances. For that, the earlier law 30% at best. However, the legislation since of 1982 must be consulted. It is also per- 1992 has gone in the direction of reducing haps interesting to note that in Bahrain's this type of taxation, and replacing it with annual budget for 200628, the items taxes collected by central government ­a `Municipalities' and `Agriculture' appear good example of the political desire to under the heading of `Miscellaneous,' along weaken the municipalities. In Syria, local with the upkeep of the royal stud farms. finances can hardly be said to exist, as all public expenditure is included in the In the West Bank and Gaza, there was a national budget. Local governments slight improvement in 2002, since the may- receive funding from central government ors then obtained the right to collect for running expenses, to which unspent directly taxes on fuels and road traffic, in balances are eventually returned (POGAR). addition to an education tax, the only tax they were allowed to collect directly until Insufficient and haphazard resources. One then. The Palestinian Authority is supposed of the recurring problems of the region's to pay back to the municipalities 90% of municipalities is the lack of resources, these local taxes, but it does not do so. which prevents them from successfully Result: the municipalities are becoming carrying out their functions. In Syria, increasingly poor. Furthermore, Palestinian Lebanon, Jordan, the West Bank and Gaza, cities are not able to collect taxes in the sur- and Yemen, the municipalities are poor, or rounding areas. Realistically, tax revenues 28. Figures provided by even very poor. In Jordan the total budg- can be collected only in villages, to which the Bahrain Finance ets of 99 municipalities increased, in 2006, many people who now live abroad send Ministry. to 161 million dollars. money, or towns with longstanding strong MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 219 commercial activities. Until recently, 90% of The high level of municipal debt. Borrow- local investment expenditure was funded by ing is standard practice for a modern local the Palestinian Authority, thanks to funding authority, especially for infrastructure. from outside organizations, such as the Bahrain31 and Kuwait32 have included in World Bank, the European Union for the their constitutions provisions for munici- urban areas, and the UNPD for the rural palities to "take out, agree to, or secure a areas, as well as bilateral technical aid from loan". Such borrowing power is also possi- the G8 countries. However, unhappy about ble for the executive body of municipal the recent takeover by Hamas, most administration in Islamic Republic of Iran, sources of outside funding have stopped all though not for the municipal councils. aid, and there is now a movement toward a fragmentation of services. But such measures in municipal funding can lead to disaster, particularly when they Similarly, in Lebanon municipalities are are used to compensate for a lack of oper- supposed to receive a percentage of rev- ating revenue, when they are not used for enues collected by the electricity, tele- investments, and when local authorities do phone, and water services. This percent- not have the means to repay the loans. age is supposed to be redistributed to This is the case in Jordan and the West them by the relevant ministries in propor- Bank and Gaza, and both economies are tion to the amount collected in each geo- incurring increasingly high levels of debt. graphical area. In reality, these ministerial Following the Hamas election victory, the organizations return the money only in withdrawal of international donors from the dribs and drabs. West Bank and Gaza, as providers of direct financial assistance to local governments, In theory, a significant part of the munici- led to the rapid deterioration of the munic- palities' revenues comes from a percent- ipalities. In Lebanon, due to scarcity of fis- age of tax revenues allocated to the state cal resources, some municipal govern- where they are managed by an organiza- ments have to resort to advance payments tion called the `Independent Municipal from the Independent Joint Municipal Fund, Fund'29. However, this fund has never ma- which are disbursed at high interest rates. terialized so revenues payable to munici- palities go directly into the national treasu- In Jordan, new measures address this bo- ry. By some estimates, in 2002 this rrowing crisis. Where municipalities have represented 0.75% of Lebanon's GDP and borrowed to cover operational costs, espe- 2% of the general budget30. Despite the cially salaries, and are overwhelmed by modest percentages, the money takes interest and service fees, the state has years to be paid, and typically flows only paid off the loans. Thanks to a reduction of after intervention by a local leader. The sit- about 20% in its general administrative 29. Establishedby uation is improving, but the state, bank- expenses, the government has wiped the decree no. 1917 of 6 rupt and heavily in debt, is still two years slate clean for third- and fourth-class April 1979. behind in its payments. municipalities (the smallest), and has 30. Al-Dawlyia lal committed itself to do the same for the Maalumet Those municipalities with a theoretical right remaining 27 municipalities by 2011. (International Journal of to collect local taxes often encounter reluc- Information). tance among citizens to pay the levy, ho- The increase in the need for public services 31. Art. 108, `On public wever legal the tax may be. Particularly in in Turkish metropolitan municipalities has lending.' Lebanon, Jordan, and the West Bank and led to an increasing level of debt. In 2002, 32. Const. Art. 136 and Gaza, most local authorities lack the this debt was the equivalent of 4% of the 137. `On public means of compelling payment. For a vari- GDP ­a full year's revenue for the munic- lending' and `On ety of practical, social, or security-linked ipalities. However, there is no legal local authority reasons, tax collection is at best uncertain. requirement that municipalities balance lending.' MIDDLE EAST / WESTERN ASIA 220 Decentralization and Local Democracy in the World their budgets, and the state has always responsibility that they have been allocated, made up the shortfall with agreeably flex- makes local authorities dependent on the ible loans from the Bank of the Provinces. state, transforming them into central gover- nment go-betweens. The central govern- State supervision of local authority finan- ment also manages in an authoritarian and ces. State monitoring of local authority fi- arbitrary way the money that is actually dis- nances is a normal, necessary and healthy tributed to local treasuries. Unequal dis- measure as it ensures that finances are tribution is often the rule rather than the managed not only efficiently, but also with exception. For example, the money allo- integrity. However, this monitoring should cated for street cleaning in just the city of not immobilize the decision-making Amman amounts to a third of the entire process. In Lebanon, for example, three budget for all Jordanian municipalities. In a separate entities monitor public municipal similar case, over the past few years the finances: the comptroller general, the audi- Lebanese government has withdrawn huge tor-general, and the State Audit Office. The amounts of money from the Independent State Audit Office carries out a priori and a Municipal Fund to pay for street cleaning in posteriori inspections of local authority metropolitan Beirut. In the same way equal- finances, focusing particularly on municipal ization is nonexistent in numerous coun- property management above a specified tries,such as Jordan and Lebanon. threshold, the signing of public contracts, public works, and service provision. In III.2. Responsibilities effect, such oversight power negates local governmental autonomy for municipalities. III.2.1. Extensive theoretical areas Jordan, Saudi Arabia, and Bahrain have sim- of responsibility ilar systems; budgets are proposed by municipal councils, but the councils can not In most countries in this region, municipali- vote to approve their budgets. ties have official responsibility for a wide range of tasks, including infrastructure and With the aim of reconciling decentraliza- many human services. On paper, municipal- tion and the careful management of ities are responsible for highways, public municipal finances, Turkey has set up a buildings and drains, outdoor lighting, and supervision system based on internal bod- waste collection, and also health, education, ies called audit committees. These consist culture, sports, and social services. of from three to five council members who Lebanon's law on municipalities33 gives must be elected annually by their respec- municipal councils extensive prerogatives in tive municipal councils in towns with more all these areas, including the support of des- than 10,000 inhabitants, and the SPAs. titute and disabled people. Similarly, the Their role is to provide a check on the Palestinian and Jordanian municipalities34 income and expenditure of local authori- are supposed to have, respectively, 27 and ties. As such, they make up a form of dem- 39 different areas of responsibility. ocratic counterweight to the established authority, particularly in those places III.2.2. A reality often out of step where the mayor is both the municipality's with the legislation highest authority and the official with the power to authorize expenditure. However, in many countries, there is a gap 33. Art. 47 and between legislation and its implementa- following. A posteriori checks are carried out, as in any tion. Many factors prevent municipalities 34. The law of September 1997 modern country, by the State Audit Office. from meeting their official responsibilities. gives them a discretionary power This lack of resources, combined with their The overlapping of areas of responsibility in many sectors. incapacity to implement the areas of with central government. In Saudi Arabia, MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 221 the Ministry of Rural and Municipal Affairs confirmed the pre-existing situation of the has drawn up a very precise list of munici- involvement of the municipalities in the palities' areas of responsibility35. In Oman, maintenance of school buildings and the pro- the Ministry of Regional Municipalities, vision of the necessary supplies. However, Water, and the Environment has done the the provision permitting municipalities to same. But several national constitutions open preschool establishments was sus- remain vague on the subject, mentioning pended by the Constitutional Court36 on the only the major sectors of planning, health, grounds that this runs counter to the spirit of and education: or nothing at all. Where the constitution, for which education is they exist, ordinary laws and statutory strictly a state prerogative. instruments for their implementation retain this legal vagueness. The predictable result Everywhere else, almost all the responsibili- is overlapping of areas of responsibility, ties are carried out by the central govern- which is highly prejudicial to the efficiency ment through its ministries, leaving the of local government work. municipalities only planning tasks and basic functions such as lighting, drainage, high- Again, Turkey provides the exception. There way maintenance, and waste collection. Of a modus vivendi seems to have been es- course, there are exceptions, most notably tablished between the municipalities and Jordan where 13 essential service responsi- 35. For the precise list, the Special Provincial Administrations (SPAs), bilities were taken away from the municipal- see the `Saudi with each providing services according to ities by the law of 1995. Beirut, Lebanon, is Commerce and its ability. Such is the case for environ- also a special case. There the provincial gov- Economic Review', mental concerns shared by municipalities ernor has executive power, the municipal November 2004. It and the National Administration for the council being a deliberative body. Also in can nevertheless be Protection of the Environment, and also Lebanon, the mokhtar has supplanted most noted that street for collective housing issues addressed municipal authorities in the registration of cleaning, public jointly by local authorities and the births, marriages, and deaths. It should be health, town National Administration for Collective noted that this is the mokhtar's only real planning, (vice- Housing. The distribution of responsibili- responsibility, though in theory their remit37 minister of town ties is also organized on a territorial basis. covers public order, health, and education. planning) and the In territories where there is a metropolitan maintenance of public buildings, municipality, the municipality is responsi- In Jordan, some of the responsibilities that public transport, and ble for most services; this accounts for the have been taken away from the municipali- traffic management present explosion in expenditure. This also ties have been taken over by private national (Department of occurs within the administrative area of a and foreign companies. Similarly, in Transport and Traffic normal municipality; in areas not depend- Lebanon the state has begun to sign con- Planning) all come ent on either, the SPAs are responsible for tracts directly, not only without the consent under the authority providing services. The recently legislated of the municipalities, but sometimes without of the Ministry of reorganization of responsabilities has also even informing them. Such was the case Rural and Municipal contributed to this development. with contracts for street cleaning, public Affairs, with water lighting, and street paving in Beirut and distribution Unlike Lebanon and Jordan, Turkey does not Mount Lebanon. The money for these con- infrastructures and have a general competence clause of munic- tracts is directly withdrawn by the state from the building of sewers being ipalities. At the present time, the main the funds of the theoretical Independent administered by a responsibilities of local bodies, particularly Municipal Fund. Hope for more profitable special service that the municipalities, are urban planning, public public services induced Palestinian central has seven regional transport and communications, water supply, government to enlist the private sector to branches. sanitation, and the treatment of solid waste. manage services that require a high level of 36. Notice no. 2005/14. Law no. 5302 added economic action, al- investment for infrastructure construction 37. Art. 25 and following though what exactly this covers is less clear and maintenance --water, electricity, and of the law on the for municipalities than for SPAs. The law also sanitation. mokhtar. MIDDLE EAST / WESTERN ASIA 222 Decentralization and Local Democracy in the World Administrative checking and central govern- sentatives, to convey concerns to national ment supervision. In a decentralized country, authorities. The Higher Provisional Council the state exercises three checks on local is responsible for the monitoring and coordi- decisions: legal, financial and administrative. nation of the lesser councils. It also drafts When this type of checking is carried out a bills that concern local authorities, and pres- posteriori it is the sign of a state that is con- ents the bills to the National Assembly. cerned about good local management. On the other hand, checks conducted a priori In Turkey, on the other hand, central go- entail the infringement on local autonomy; vernment supervision has been reduced by this is so, even when some local authorities the latest reforms, with the provincial gover- ­ particularly those in Lebanon ­ who are nor no longer having direct control over faced with depleted resources, interpret it as council proceedings or their finances. His a sign of protection and guarantee. powers are now restricted to submitting a case to the administrative tribunal when Taking a broader perspective, two fairly there is a suspicion of malpractice. In addi- distinct systems emerge in the region. In tion, within the framework of a new mana- Saudi Arabia, Kuwait, and Oman, munici- gerial vision of municipal management, the palities are branches of their controlling new laws emphasize the importance of a ministry, though they occasionally function performance audit based on modern audit as go-betweens. Elsewhere in the region, methods, rather than on a legality oversight. laws and regulations delineate a minimal, quasi-autonomous status for local authori- The comparative administrative autonomy ties, albeit with significant political and fi- of local governments in the West Bank and nancial constraints. Gaza is offset by significant fiscal control by the central government. Communication dif- We have seen how much a priori financial ficulties make centralized administrative con- monitoring weighs heavily on the autono- trol impractical, but most financial resources my of municipalities, preventing them flow downward from the central authorities. from performing their functions. Similarly, with the exception of Turkey, municipal In Syria, Islamic Republic of Iran and council discussions are also subject to a Saudi Arabia, there is an additional admin- priori monitoring by the central govern- istrative check in the form of an electoral ment or by one of its representatives, such system requiring that candidates for local as the provincial governor in both Lebanon posts be approved by an ad hoc electoral and Jordan. Technically, this monitoring of committee; this could be called an virtually all discussions may even be illegal `absolute a priori check' since it takes place in some countries where it occurs routinely. prior to the discussions themselves. Indeed, in Jordan and Lebanon, the consti- tutions state in almost identical terms that The security factor. The Palestinian Authori- all local affairs must be managed by the ty's exclusive powers apply only to 20% of its municipal councils. Yet in Lebanon, on territory (the category A areas, which are average only 20% of municipal council mainly urban), the rest being run jointly with decisions are immediately enforceable, Israel or by Israel alone. As a result, the 33% require the prior approval of the municipalities only rarely see their decisions, provincial or regional governor, and 47% whether about urban planning or tax collec- need approval from the Ministry of the tion, applied in their area. The use of law Interior and the Municipalities38. enforcement personified by the Palestinian Police is subject to the prior authorization of 38. ABDELGHENI IMAD, In a similar way, local councils in Islamic Israel, which retains control of the vast Municipal elections, Republic of Iran rely on the Higher Provincial majority of the rural areas. In addition, Jarrous Press, p. 20. Council, an assembly of all the local repre- everything to do with heavy infrastructures MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 223 and land use planning is dependent on an reform should lead to an improvement and outside body: the State of Israel. increased local management of services in the rural areas. Thanks to these, all Turkish On the whole, local authorities throughout villages should benefit, before the end of the region have only nominal, if not fake, 2007, from water supply, drainage, and autonomy. At best, national leaders either access roads. There are two types of coop- retain a traditional concept of the role of erative structures: unions of municipalities local authorities, or consider them unable to and unions for irrigation. deliver higher-quality services; at worst, they do not want them to gain increased impor- Neighborhood committees. During the Israeli tance. As usual, the exception is Turkey, occupationinthe West Bank and Gaza,Pales- where a certain number of responsibilities are tinian neighborhood committees were gradu- actually carried out ­ some since the latest ally created to deal with those services that law ­ by decentralized local authorities. wouldordinarilybeprovidedbymunicipalities. They still continue to provide some services, III.2.3. External solutions to the municipal suchaswastecollection,intheAlMahâtaarea framework of Khan Younès in the Gaza Strip, for exam- ple. This system exists also in Iraq, where in The myriad formal and informal arrange- the city of Basra 170 local informal commit- ments that prevent local governments in tees sustain the municipal council not elected the region from representing their citizens to be distributed food and fuel. in a meaningful way, lead with little sur- prise to increasing interest in alternative In Turkey, on the other hand, the neigh- means of civic participation. borhood committee consists of a tradi- tional structure organized by the latest law Unions of municipalities. Some municipalities as a direct link between the inhabitants in the West Bank and Gaza and Lebanon have and the municipality. sought a solution in the pooling of their resources. In the West Bank and Gaza, for Private benefactors. Despite the informal and example, `Joint Service Councils' have been seemingly haphazard nature of private aid, set up by the Ministry of Local Government to private benefactors ("evergets") have always construct and run communal infrastructures. played an important role in Middle Eastern This has obvious appeal to the mayors of municipal life, Turkey again excepted. At small local communities, but worries city times private funds make up for state inade- authorities. The higher municipal authorities quacies, but more often private benefactors understandably fear the loss of their preroga- provide cultural and social services. Primarily tives, and would rather bring pooling activities in the West Bank and Gaza and Lebanon, to a halt. In Lebanon, on the other hand, it is though sporadically throughout the Middle the lack of resources which prevents the com- East, most municipalities are reduced to rely- munities of municipalities from functioning, as ing on private benefactors for grants for state subsidies are never fully paid out. schools, health centers and some hospitals, free meals, and cultural centers. During the In Turkey, where the municipalities work well, July 2006 war in Lebanon, traditional leaders inter-municipal cooperation occurs primarily and businessmen took responsibility for in rural areas where there is a marked short- financing the reconstruction of bridges. age of skilled administrative personnel. The 2005 reform39 reorganized inter-municipal III.3.AdministrativeCapacities organizations, making them a new tier of decentralization, with the responsibilities re- After finances, recruitment methods and trai- cently granted to the Special Provincial Ad- ning for local government employees is the 39. Lawno.5355of26 ministrations and with a proper budget. This least transparent administrative element. It is May 2005. MIDDLE EAST / WESTERN ASIA 224 Decentralization and Local Democracy in the World difficult, if not impossible, to obtain precise, 2004, and nearly doubled to 43,132 in reliable figures on the people employed by 2005. local authorities. A tradition of patronage makes such information especially difficult to In Turkey, a new municipal law sets dead- obtain. However, certain major trends are lines for payment of salaries, and fixes a becoming apparent. ceiling for staff expenditure, making it the personal responsibility of the mayor if Central government supervision. In Leba- these limits are exceeded. At the same non, only lesser municipalities are permit- time, municipalities have been given more ted to draw up their own organization flexibility in their staffing structure. charts40. Government employees in provin- cial capitals and in important towns are Jordan too launched a series of training pro- public servants dependent upon the grams after an assessment showed that National Council of the Public Service, lack of skills and low productivity among which answers directly to the Prime Minis- municipal employees was slowing the gene- ter. In Jordan the recruitment of public ral restructuring of the municipalities. sector employees, for which the Civil Serv- ice Office is responsible, has been decen- By contrast, Lebanon has effectively tralized, to each governorate, by the cre- imposed a freeze on municipal hiring since ation of councils run by the governor. 1975. True, a 1977 law on the municipali- ties directed the Minister of the Interior to In the countries where some or all munic- organize training seminars for local ipal councillors are appointed by the cen- employees, but it also seems that nothing tral government, they are public servants substantive has been done since. An indi- in the service of the central government; cator of decline in the public sector is the municipal employees who report to them average age of local municipal employees: cannot therefore be considered local gov- 55 years. As a result, the number of local ernment personnel. This has been the case government employees is insufficient, as it in Saudi Arabia, Jordan, and Kuwait since also is in all branches of the civil service. the last elections in those countries. In Syria, as in most countries in the The issue of the training of local govern- region, skilled people are moving out of ment staff. The lack of training for most local authority jobs, and into the private local authority employees is a serious im- sector where pay and career prospects are pediment to efficiency. Aware of this, sev- much better. eral countries of the region, with the encouragement of the UNPD, have Malfunctioning recruitment methods. Many launched extensive training programs for local authorities actively circumvent arcane local government personnel. official hiring regulations. Instead, they hire increasing numbers of local people on In Saudi Arabia, the `Municipal Chairmen's short-term contracts. In principle, this Performance Improvement Service,' a spe- strategy allows the municipalities to have cial department of the Ministry of Rural more local management of their affairs. and Municipal Affairs, has created a pro- gram to improve the skills of municipal Practices in Turkey are illustrative. Al- personnel, and to encourage their geogra- though recruitment of public servants has phical mobility. This is taking place within a high priority in the national legislature, the framework of a long-standing training and a competitive examination has been 40. Law on the program for public servants. The number established for government employment, municipalities in of those who have received training has the number of official public servants has Lebanon, art. 88. risen from 12,649 in 1989 to 23,056 in remained more or less stable. At the same MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 225 time, the number of temporary workers, election law, they are still in the process of most of whom are not well-qualified, and development. are employed for an average of one year, is steadily increasing. From 1995 to 2003, In Saudi Arabia, Prince Mansour Bin Mitab, the percentage of temporary municipal a firm supporter and the main organizer of employees increased from 21.4% to 35%. municipal elections, did not hesitate to These temporary workers can be far more describe them as the first stage, empha- easily taken on and dismissed. sizing that improvements are still needed, including women having the right to vote. Throughout the region, the recruitment of As evidence of the newness of the election, municipal employees is not done on the the electoral districts themselves had to be basis of their skills and experience, but ra- drawn up after the registration of voters on ther through patronage based on political electoral lists. or community factors. Jordan, since the first local elections in 1999, This practice results in an excess of staff, has been going backward and forward. The many of whom are poorly qualified or un- government went back on the nomination of qualified. Officials simply award jobs in lo- mayors in 2003, but promised to hold new cal government as a means of establishing elections on the basis of universal suffrage their personal influence. Though to some before the beginning of 2007 ­ except in the degree ubiquitous, this practice is espe- city of Amman, which has special status. cially common in Lebanon and Jordan. There were until now 360 appointed council members compared with 920 who are Inefficiency is by no means the only harm- elected. The number of municipalities has ful effect of pervasive nepotism and been reduced from more than 300 to 99. patronage. Such practices perpetuate a With the new municipal law of 2007, all system of corruption whereby the person council members are elected, except in who provided the job expects favors in re- Amman. Indeed, the municipal elections turn. The perception of corruption is strong in took place on the 31st of July 2007; about the region. When citizens in a 2002 Turkish 2,300 candidates ran for 1,022 seats. survey assessed their confidence in local authorities at only 5.2 out of 10, the In Lebanon, the election by universal suffrage national government was moved to create of mayors and their senior deputies was abol- a special ethics committee to investigate ished just before the 1998 elections by an corruption, and three new laws41 were amendment in extremis of election law. May- passed to address the situation. But this ors are now elected by the municipal council. requires a strong political will. It should also be noted that the countries that Inthe West Bank and Gaza,thevotingmethod obtain the best scores regarding corrup- is not fixed. Since 2005, when municipal elec- tion are also those, such as Dubai, with the tions were conducted in five successive stages, most visibly proactive state policies. there have been changes to the procedure, passingfromvotingforasinglecandidatetopro- portional representation. Moreover, the right to IV. Local Democracy vote is not the same throughout the Palestinian territories. In the Gaza Strip, all refugees can 41. Law no. 3628 of 4 IV.1. A Changing Local Democracy vote, regardless of their place of residence; in May 1990 amended the West Bank, refugees who live in the towns by law no. 5020 of Table 2 summarizes significant advances in take part in the voting, but those who still live in 26 December 2003, local democracy in the Middle East region. the refugee camps indicate their wish to return law no. 5237 of 26 Note that if the local elections in some to their homeland by unanimously keeping well September 2004 of countries are based on specially devised away from local political life. the penal code. MIDDLE EAST / WESTERN ASIA 226 Decentralization and Local Democracy in the World Table 2 The Lack of a Democratic Tradition Country/ Date of the last local council elections Date of the first election of a municipal council Political parties territory Saudi Arabia 2005 1963 in Riyadh ­ but no elections between 1963 and 2005 (First election No on a national scale) Bahrain 2006 1921 in some towns ­ but no elections between 1921 and 2002 (First No election on a national scale) United Arab No elections No elections No Emirates Iraq 2004 (Dhi Qar province) 1869 ­ but no elections between 1957 and 1999* Yes 2000 & 2001 (Kurdistan)* 1999 (Rest of Iraq) Iran IslamicRep. 2006 1999 Yes Jordan 2003 187842­ but no elections between 1957 and 1989 Yes (since 1992) Kuwait 2006 (partial) 1932 No Lebanon 2004 1878­ but no elections between 1963** and 1998 Yes (2001 for the villages in the south) Oman No elections No municipalities No Qatar 2003 1999 No Syria 2003*** 1878 ­ but no free elections between 1972 and 2007*** Yes Turkey 2004 1856 (for Istanbul); 1878 (for Ottoman Empire); Yes 1930 (for the Republic of Turkey) West Bank 2005 1927 Yes and Gaza No elections between 1934 (Gaza Strip) or 1976 (West Bank) and 2005 Yemen 2006 2001 Yes 42. This refers to municipal * February 2000 for the areas dominated by the Kurdish Patriotic Union and elections held in certain May 2001 for those areas under the control of the Kurdish Democratic Party. municipalities of the ** First significant municipal elections carried out on a national scale. Ottoman Empire in *** That is to say without a closed list. 1878 in accordance with the Law on Municipalities in the Provinces of 18 May 1877. MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 227 Syria, where the municipal councillors have Republic of Iran, candidates are accepted long been elected by universal suffrage, now only after an examination validates the wants to move toward real pluralist local intensity of their faith, or their belief in the democracy. The 2007 reform law stipulates authority of a jurisconsult, the Velâyat-é- that people may elect the candidates of their Faghih ­ a situation which continues to choice, and not, as has been the case so far, arouse strong suspicion. In Syria, according just one from a list drawn up by the National to the present law, the party in power com- Progressive Front ­a coalition led by the piles the list of candidates. Baath party currently in power. Election into office. This type of election lim- IV.2. Partially Kept Promises: its the number of candidates to the number The Central State and Local Politics of vacant posts, ensuring that all candidates will attain public office. Seen as a cost-sav- The only two states in the region where ing measure, it is reserved for unusual cir- there is absolute centralization are the cumstances. When, on the other hand, it is United Arab Emirates and Oman. There are the result of pre-electoral bargaining, it can no elections in these two states, though be detrimental to the exercise of socially the possibility of introducing elections is aware democratic principles. being considered on an official level. Pre-election arrangements influenced Leba- Municipal elections have been established non's most recent elections; 121 municipal in all the other countries. For all that, sec- councils and 400 mokhtar were elected into ular traditions, which are more based on office following an alliance between the the voluntary `consultation' by the sover- political parties and traditional leaders; in eign than on the sovereignty of the people, effect, the two factions merged. In Jordan, are not easy to circumvent. The electoral a similar approach was observed in 17 mu- process in many places is still marked by nicipalities. central government intervention. b) A posteriori intervention a) A priori state intervention The modification of municipal councils. In Nominations. The clearest and most official Jordan in 1999, the king changed the com- type of intervention is, of course, the nom- position of municipal councils to include a ination of all or part of a municipal council, woman in each of them ­ a rather positive including mayors. This is presently the action. By contrast, in Kuwait in 1986, the case in Saudi Arabia, Jordan, Bahrain, and Emir simply dissolved all the municipal Kuwait. councils. In Syria, as we have seen, it is the exis- In Syria, once the local councils are tence of an `executive council' or `execu- elected, they in their turn elect an execu- tive bureau' parallel to the municipal coun- tive bureau; a third of the executive cil which embodies this central control. bureau candidates can be recruited from the local councils themselves. Further- Prior examination of the candidates. Another more, after an election, certain specific form of interference is the prior examination public service-related issues can be placed of the candidates by the central power. This in the hands of permanent or temporary permits the central government to effectively committees that include people from out- steer the election in a particular direction. It side the municipal government. is this process that caused the extraordinary length (from February to mid-December) of Intervention in the election of the mayor. the 2005 elections in Saudi Arabia. In Islamic This form of tutelage of the State is MIDDLE EAST / WESTERN ASIA 228 Decentralization and Local Democracy in the World harmful to democracy and to good gover- disappointment with the outcome of pre- nance. In Lebanon, the abandonment of vious ballots, or the subsequent ineffec- direct elections has contributed to this tiveness of elected officials, does take a tutelage. toll. Disillusionment with elected officials and the process by which they come to IV.3. The People's Participation power has been noted especially in Jor- dan and Islamic Republic of Iran. The 2005 Palestinian elections were the first in 71 years in the Gaza Strip, and the However, voter disinterest can vanish first elections in 29 years in the West when the vote is perceived as an expres- Bank. Voter turnout was extraordinary: sion of popular demand or a form of appro- average turnout was 82% and rose to 98% bation. The 2006 municipal elections in in certain areas. The elections were widely Bahrain thus had a turnout -- a clear perceived as the restoration of the right of increase -- of 72% because of the involve- the Palestinian people to self-determina- ment of the Shiites. Similar elections in tion after years of the systematic destruc- Islamic Republic of Iran saw a 60% tion of their state structures. turnout because of immense discontent with the policies of President Ahmadinejad. In Turkey also, the turnout percentage is generally quite strong, proof of the popu- IV.4. A Specific Problem: lation's involvement in local life. In 2004, The Representation of Women average voter turnout reached 72.3%. A low representation. Unsurprisingly, in its In the rest of the region, voter turnout is 2005 report Transparency International much lower. There are two main reasons severely criticizes the Middle East as being for this. The first is the widespread per- the region of the world where the political ception that the game is corrupt. The representation and participation of women second, which must not be underesti- is the lowest43. mated, is public disappointment with most of its elected officials. When dis- Turkish women were given the right to honesty is expected, whether by pre- vote in 1930, and since 1934 the right to election selection of candidates with be elected44. Saudi women, on the other reserved seats --the case in Saudi Arabia hand, will only be given the right to vote in and Syria-- or by manipulation of elec- 2009, whereas nothing of the kind is tion results or even election law, turnout planned in the Emirates. Kuwaiti women is apt to decline. Allegations of corruption obtained the right to vote in 2005. were particularly strident in Yemen after the last election there; the Shiites of Elsewhere, their representation figures are Saudi Arabia, and most Lebanese elected derisory, hardly reaching 2% of the munic- officials are widely suspected of cheating. ipal councils in Lebanon, 1.53% in Islamic In Lebanon, however, low overall turnout Republic of Iran, 3.4% in Qatar, 6.6 % in 43. www.transparency.org. figures (33.3%) can mask wide dis- Syria, and an unabashed 0% in Bahrain. 44. The right to vote parities in local turnout, depending upon was given to women what is at stake or the extent of candi- In most of these countries, entering the in 1948 in Syria, dates' mobilization. Thus, the low figure political arena requires strong-willed wo- in 1952 in Lebanon, of a 21.4% turnout in Beirut contrasts men at a time when merely working out- in 1963 in Islamic starkly with the 70% turnout in the side the home is still discouraged. Women Republic of Iran, in 1967 in Yemen, Bekaa, and the 65% turnout in Nabatiah; who want to take part in politics often face in 1973 in Bahrain, in both high-turnout areas, the main extremely difficult social factors, such as in 1974 in Jordan, beneficiary of the surge in participation family opposition and public disapproval. and in 1980 in Iraq. was Hezbollah. The second reason, voter Some allege that women also must over- MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 229 come the reluctance of party managers to ideologies to appear on the ballot, over- accept women, but in all fairness, such male whelming local issues with far more intransigence is hardly unique to the Mid- potent national matters. Such was the dle East. case in the West Bank and Gaza when Hamas triumphed, and in Saudi Arabia Steps towards the participation of wo- when Shiites of the Eastern Province men. Faced with a glaring lack of female boasted of having won the election in representation in local and national their regional stronghold. Similarly, the political life, several strategies have victory of Hezbollah in South Lebanon been put in place. The quota system, used local elections to effect a national which is applied in Palestine, reserves a change, and in Islamic Republic of Iran minimum of two seats per council for the 2003 municipal elections in Tehran women45. Jordan and Kuwait have cho- led to the return of the conservatives, sen the direct nomination of one woman and particularly of President Ahmadine- per council. At the same time, important jad, the city's mayor. Ironically, the 2006 campaigns in favor of women have been municipal elections rejected his policies launched in Jordan and Syria. throughout the country, with the popula- tion going to the polls on a massive scale Thus, municipal councils throughout the in order to vote for the opposition. This region face enormous difficulties, lead- was also the situation in Bahrain, which ing, in some instances, to their resigna- was the scene of a very strong Shiite tion, as in Jordan; in other countries, an upsurge in November 2006. even larger number of councils have renounced any form of concrete action. IV.6. The Role of the Security Factor and the Delicate Situation IV.5. Local Elections as an Ideological of the Governments and Community Platform The religious community issue. Many If it is necessary and healthy that a countries are currently the scene of country's political life should rest on deep-seated tensions, some attributable nationally constituted parties, it is not to the merging of religion and politics, desirable that national issues override others to centuries-old feuds between local concerns. Municipal elections are, Islam's Shiite and Sunni communities. after all, intended to create an efficient The latter is especially important where local authority management. the Sunni have held power for a long time in spite of the presence of a strong Lebanon provides an illustrative exam- Shiite minority, or indeed a majority, as ple. Although the number of national in Lebanon, Iraq, and Bahrain. Saudi parties is negligible, elections are well Arabia's government contends with a and truly fought on religious community Shiite community that could deliver a issues which are national in scope. 20% turnout ­ not the 5-15% which is generally reported. The central govern- A curious development is the way in ment there exercised strong control dur- which local elections can become a ing the election in the Eastern Province 45. There are 15 seats forum for banned national parties or fac- where the Shiites are a clear majority, in the cities, 13 in tions. Because local elections are consid- and where, it is useful to note, there are medium-sized towns ered less of a threat to the central gov- important oil-fields. Likewise, the King and 8 in small towns ernment, they may not be as tightly of Bahrain faces the risk of destabiliza- according to the controlled as national elections. Local tion by the Shiite majority there, as the electoral law of elections therefore present an opportu- results of the recent parliamentary elec- 1996, amended in nity for disapproved or illegal parties and tions showed. 2005. MIDDLE EAST / WESTERN ASIA 230 Decentralization and Local Democracy in the World The risk of destabilization is real. This is Religious extremism. The other factor why the Lebanese and Iranian governments which must not be neglected is the rise of (the Persians in Islamic Republic of Iran are hard-line religious extremism. Such reli- only in a majority of 51%) exercise such gious fanaticism characterizes several fac- strong control over local governance. tions of fundamentalist Islam. Their avowed goal is to establish regimes based Kurdish nationalism. The recognition of on a particularly narrow reading of reli- Kurdistan by the transitional Iraqi govern- gious texts. These groups are not only ment, and the granting of extensive opposed to secular governments, but also autonomy which even includes legisla- to those that, like Saudi Arabia and Jor- tion, gave hope to the Kurdish communi- dan, are already governed by the Sharia. ties in neighboring Syria and Turkey. It is Even these officially Islamic states are per- clear that municipal elections provide a ceived by fundamentalists as being too convenient means for Kurdish people in inclined toward westernization. Some fun- those two countries to agitate for a damentalists in Saudi Arabia refuse to vote degree of autonomy comparable to that in legislative elections because, they say, granted in Iraq. "God is the only dispenser of law." MIDDLE EAST / WESTERN ASIA Decentralization and Local Democracy in the World 231 V. Conclusion What emerges from this study is that de- of restructuring of the State, beginning with centralization, understood as the devolu- the strengthening of national legislatures. tion of responsibilities, and financial and Broad awareness campaigns on local gover- decision-making self-government, is not nance and effective institutions are also key. yet completely operational in the countries of the region, with the exception of Turkey. Problems in service delivery and weak local Currently, the majority of municipalities management functions in general need to be have little room for maneuver, subject as addressed, as underlined by UNDP POGAR, they are to a twofold dependency ­formal through the development and strengthening and informal- on the State and traditional of local capacities as well as of transparency. leaders. The success of decentralization efforts de- At the same time, one should take into pends on the selection and training of mu- account the social organization and security nicipal civil servants and employees. That environment of the region. Limited progress requires special focus and attention. in the processes of decentralization should be considered in the overall context of ten- Local governments should be equipped with sions and conflicts, in the relations between the adequate means to carry out their tasks traditional leaders, either tribal or religious- i.e. the necessary fiscal and budgetary re- based, as well as in relation to the popula- sources accompanied by the transfer of in- tion at large. dependent decision-making authority. All these factors help explain UNDP- Finally, although many countries in the re- POGAR's46 more prudent approach to gion are on the right track towards decen- change that advocates a gradual pace of tralization, it will take some time before reform as part of a comprehensive strategy these processes become fully operational. 46. See: www.pogar.org/ governance/ localgov.asp. MIDDLE EAST / WESTERN ASIA 232 Decentralization and Local Democracy in the World Annex 1 Great Metropolises of the Region Country/ Number of Total % % Increase Existence Municipal organization territory large cities population of population population of total of a (more than the three of the of the country municipal 1 M. largest cities, country country population specific inhabitants) 2006 (in M. in 2006 in 2005 2005-2006 structure inhabitants) (1) (in %) in the three largest cities Iraq 3 10,83 37% N/A 2,8% No One single municipality and councils as advisors in Baghdad and Basra districts Iran,IslamicRep. 7 17,27 25% 23% 0,0% No One single municipality with a main municipality and many councils and district municipalities under the first level Jordan 1 1,9 34% 24% 1,8% No,but Amman has a metropolitan structure possible reformforthe largecities Kuwait 1 2,02 72% 71% 3,7% No Only one municipal council Lebanon 1 1,97 55% 50% 0,8% No One single municipality, but for security reasons the `Prefect' has the power Saudi Arabia 4 10,86 43% 36% 2,4% No a)One municipality which supervises many municipalities of district on administrative matters only (Riyadh and Jeddah) b) one single municipality (Mecca and Damman) Syria 2 4,87 25% 25% 2,6% No One single municipality with the administration in the districts Turkey 6 22,01 30% 26% 1,4% Yes Metropolitan municipalities and others of first level United Arab 1 1,42 30% 29% 4,4% No Unique structure : Dubai is managed as an Emirates enterprise under a `General Director' West Bank 1 1,43 38% 25% 5,6% No One single municipality and Gaza Yemen 1 1,92 9% 9% 2,9% No Special status for the Sana governorate Total 28 77,14 37 % 10,6% 2,56% Source: World Bank Indicators. Annex 2 Local Democracy MIDDL Municipal councils Executive local authority Country/ Form of One or Number of Participation Mayor Mayor Mayor Power in Number of Indictment by territory scrutiny several periods and estimates elected elected appointed hands of the periods and the citizens or (proportional / electoral duration of by vote by the by Mayor or in a duration of by the EEAST majority districts the terms municipal a superior collegiate the terms municipal council authority body council Bahrain Majority Several 4 years 72% for 2006 No No Yes (Ministry MHHE) (3) Ministry MHME 4 years No (increasing) 51,3% for 2002 Iraq (5) Variable Var. Var. 79% in Kurdistan in 2001 Var. Var. Var. Var. Var. Var. Iran,IslamicRep. Relative majority Unique 4 years 60% 2006 No Yes (6) No Mayor 4 years Yes by the (increasing) 49.96% 2003 Municipal Council (7) Jordan Majority Several 4 years 58 % in 2003 (decreasing) No No Yes (8) Municipal council 4 years No Kuwait (9) Majority Several 4 years 50% (decreasing) No Yes No Mayor 4 years No /WE Lebanon Majority Unique 6 years 33,3% in 2004 (decreasing) No Yes No Mayor (In Beirut 6 years Yes, by the Municipal (unlimited) the governor) unlimited (10) Council after 3 years Oman NA NA NA NA NA NA NA NA NA NA Qatar (14) Majority Several 4 years 30% in 2003 (decreasing) No Yes No MMAA 4 years No (15) (at first round) Saudi Arabia Majority Several 4 years (1) 40% in 2005 (2) No No Yes (The King) Mayor 4 years No Syria (16) (List of candidates Unique except 4 years 29,3% in 2003 No No (18) Yes, Ministry of Municipal 4 years No Decentrali with fixed seats) Damasc and Alep (decreasing) (17) Municipal Affairs Council (19) Turkey Proportional Unique 5 years 71,75 % mayors 69.97% Yes (relative No No (20) Mayor 5 years Evaluation every year by STERN metropolitan mayors majority, less than 3/4 of councils or zationan (65% in 2004) one round) motion of indictement by 3/4 United Arab - - - - - (4) - - - - Emirates dLocal West Bank Proportional (11) Several 5 years 82 % in 2005 No Yes No (12) Yes 5 years Yes by the Municipal and Gaza Council (by offence) (13) Dem Yemen Majority Unique 5 years 65% No No Yes by Ministry of local Mayor 5 years No administration (21) ocracyin NOTES ASIA 1. Only half of the councils are elected, the rest are vote, Baghdad; chosen by a group of important and 6 are appointed. 15. Only by decision of the Minister of Municipal and Rural appointed. citizens, Mosul. Affairs. 10. The election of the Mayor and that of the Mokhars 2. About 18% of the potential voters, one third of them 6. Accumulation of jobs is forbidden for Minister, Vice take place together. 16. But a new more liberal law will be passed in 2007. is registered in the electoral lists. minister, Congress Deputy and Director of Bank or theWorld 11. The number 5 Law of 1996 for the councils' election 17. 21% in cities, 34% in small towns and 33% in very Director of other public entity. 3. Ministry of Housing, Municipalities and Environment. was amended in 2004 and twice in 2005. From small villages, while 66% in 1999. General Director. 7. Article 73 of the Municipal Council Law. The Council majority, the scrutiny became proportional. 18. It should be done according to the new law can accuse the Mayor who has to present his 4. A Sharjah only, but the Municipal Council itself is not 12. From 1976 to 1993 a great proportion of the Mayors arguments in 10 days. The Council then decides if he 19. It is in fact a council of the city. elected. were appointed by Israel. is removed or not. 20. But the Executive Council has elected and appointed 233 5. There are several situations: Municipal Councils chosen 13. But the destitution has to be approved by the local 8. Ministry of Municipal, Rural and Environment Affairs. members. among the Ministry of Municipalities and Public Works Interior Ministry. 21. The government has to approve it. employees (MMPW) Basra; elected by universal 9. In each Council 10 members are elected 14. There is only one Municipal Council for all the country NORTH AMERICA (CANADA AND THE UNITED STATES) JEFFEREY SELLERS NORTH AMERICA 236 Decentralization and Local Democracy in the World NORTH AMERICA Decentralization and Local Democracy in the World 237 I. Introduction legislation or measures taken by individual states or provinces. In both federal coun- This chapter compares local government tries local government is a creature of fed- and decentralization in Canada and the eral states, provinces, or territories. In United States. These two North American Canada and a number of U.S. states, state countries share important, parallel inherit- legislatures determine the content and ances.Botharesettlersocietiesthatemerged powers of local government. The main out of British colonialization. The simi- exceptions are provisions in some U.S. larities in their local government systems state constitutions for local government have frequently led to their classification powers. In the United States, approxi- together (Hesse and Sharpe 1991; Sellers mately half of these documents specify 2006, 2007), and with other countries with some general power for local govern- similar legacies such as Australia and New ments. Zealand. Institutional practice in these countries Both countries are established constitu- also reflects the legacies of the British tional democracies with federal structures ultra vires principal that limits the general of government. Both possess highly purpose authority of local governments. Institutional developed economies and have in com- The "Dillon Rule" in the United States ­the mon legal, institutional and cultural lega- principle that local governments cannot practiceinthese cies from British colonization from the claim powers beyond those specifically countries also seventeenth to the nineteenth centuries. granted by the state legislatures--pro- Other colonial and pre-colonial legacies vides a good example. Thirty-one of the reflectsthe also mark the practice of local govern- fifty U.S. states continue to apply Dillon's legacies of the ment in certain areas of each country. Rule to all municipalities, and eight further Most notably, French influences have states apply it to some but not all types of British ultra vires been strong in the Canadian province of municipalities (Richardson, Gough and principal that limits Québec, and have also affected aspects of Puentes 2003: 17). Increasingly, how- institutional practice in Louisiana in the ever, exceptions to this principle have the general U.S. In parts of each country, indigenous been introduced. Beginning in the nine- traditions remain important to local go- teenth century, U.S. states legislated purpose authority vernment practice. guarantees of general local government of local authority in "home rule" legislation as well Local government in both countries was as in state constitutions. This trend con- governments established in the original British colonies tinued up to the 1990s. As a result, local prior to the creation of a national govern- government in all but three states has ment. The arrangements for local govern- some degree of home-rule powers, and 28 ment in what would become New England U.S. states have broad powers that in in the United States grew directly from some cases amount to grants of full local those in early colonial settlements. In autonomy to treat local affairs (USACIR Canada, provincial acts of the 1840s and 1993). In Canada, in 1994 in Alberta, in 1850s established the framework of local 1999 in British Columbia and, since 2000 government prior to the Constitution Act in Ontario and Québec have also given of 1867. broader powers to localities, even as larger cities continue to call for additional Although present-day local government in institutionalized local powers. these countries can possess considerable powers, it lacks either national constitutional These variations reflect another way that protections or a legislated grant of auton- local government in the United States, and omy. What powers local governments have to a lesser degree Canada, differs from received have come from either national that of many other countries. Because dif- NORTH AMERICA 238 Decentralization and Local Democracy in the World ferent U.S. states have established a vari- II. Local Government Structures ety of legislative frameworks, there are and Their Evolution some fifty American local government sys- tems. Even within states, the diversity of The evolution of local government structures local arrangements has produced more in Canada and the United States needs to heterogeneous systems of local institu- be understood in relation to the distinctive tions than elsewhere. Most of the largest model of local decentralization that has cities in the United States, as well as Mon- long prevailed in these countries. On the treal, Winnipeg, Vancouver and Saint John one hand, the national and other higher le- in Canada, have individual charters from vel governments have generally granted their respective state or provincial govern- local governments limited legal authority ments. compared with that permitted in continen- tal European countries, and less financial The evolution of local government Expansion of local support from above. On the other hand, powers has been local governments are also less subject to structures in Canada and the United States only one of several the direct local supervision of territorial needs to be understood in relation to the local government field offices or prefectures, and enjoy high reforms. Along with levels of local fiscal autonomy compared distinctive model of local decentralization enhanced local with counterparts in Europe and Asia (Sell- that has long prevailed in these countries powers, legislation ers 2006; Sellers and Lidström 2007). In in both countries recent years, the elaboration of policymak- has articulated lo- ing in North America, both at local and cal responsibilities in greater detail, and has higher levels, has changed this model in specified mechanisms for accountability in a several functional areas. Higher level gov- variety of specific functional domains, such ernments have introduced new responsi- as local educational services, environmental bilities in many of these areas. Although regulation, and planning. In the United this trend can be seen as a move toward States but much less frequently in Canada, centralization in one sense, new activities privatization has emerged as a more recur- and often new powers and fiscal resources rent strategy in service delivery. In various for local governments have often accom- ways, local governments have also evolved panied it. practices to address the growing horizontal interconnectedness of localities and Local government takes a variety of forms, regions. In Canada these reforms have with a different nomenclature in each often taken the form of inter-governmental country (Table 1). In the United States, consolidation or metropolitan governance; local government in many states has at in the United States, informal inter-local least two traditional tiers of government: cooperation and special district governance counties and towns. Counties play an have proliferated. important role in every state outside of New England as major providers of general In both countries, state or provincial go- services like courts, jails, land records, vernments as well as local governments welfare, health, and roads. A number of themselves, have been the sources of re- eastern and Midwestern U.S. states have forms. The extent of recent reform gener- also maintained an intermediate level of ally has fallen short of the comprehensive town or township governments between reforms passed in New Zealand or parallel counties and municipalities. The legal sta- reforms in Australia. But local govern- tus of the town level varies considerably ments in Canada and the United States according to state laws. In Canada coun- already possessed many of the powers re- ties and their equivalents generally have cently given to local governments in the less power and are only present in some two Australasian nations. provinces, but the types of municipalities NORTH AMERICA Decentralization and Local Democracy in the World 239 Table 1 Governmental and Country Characteristics Name Canada United States Inhabitants (thousands) 31,362 288,205 Area (km2) 9,984,670 9,631,420 Inhabitants/km2 3 30 GDP/capita 35,758 42,623 National Federal Government Federal Government Intermediate Provinces (10), States (50) Territories (3) Local: Upper Tier: Counties, Regions, Counties (3,034), Districts (199) consolidated Cities Lower Tier: Cities, Towns, Townships/towns (some states) (16,504) Villages, Municipalities (Cities, Boroughs, Townships (3731) Villages) (19,429) Special Districts (48,558) Note: Population and GDP data for 2002; Area (land and water) for 2006; Canada (Upper tier), United States), 2006 (Canada (lower tier). Sources: (area) CIA World Factbook (retrieved December 10, 2006 at https://www.cia.gov/cia/publications/factbook/geos/us.html); (population and GDP) OECD Statistics Portal (retrieved December 10, 2006 at http://www.oecd.org/statsportal/0,2639,en_2825_293564_1_1_1_1_1,00.html); (governments) Rivard and Collin 2006, p. 5; Commonwealth Local Government Forum 2002a, p. 2; Commonwealth Local Government Forum 2002b, p. 3; U.S. Census Bureau (2002), p. 3. vary widely. Single-tier local governments ships­ have played in providing regional predominate in all but three provinces of and inter-local governance. Especially in Canada, Ontario, Québec, and British Co- the United States, informal and specialized lumbia. inter-governmental arrangements have often taken the place of formal and gen- Local government consolidation and eral-purpose institutions. inter-local governance. Recent trends toward new regional arrangements or local In Canada, consolidation of local govern- government consolidation in much of ment units took place in Québec, Nova Sco- Europe have had mixed resonance in North tia, Ontario and a number of metropolitan America. Part of the reason for this may be regions since 2000 (Rivard and Collin the roles that established governmental 2006). More recent initiatives have rolled units ­Canadian provinces and territories, back some of these reforms in Québec and U.S. states, and U.S. counties and town- elsewhere. In the United States, the degree NORTH AMERICA 240 Decentralization and Local Democracy in the World of consolidation has always varied widely developed distinct metropolitan institu- by regions. In recent decades consolidation tions. County governments like King and annexation of territory by local govern- County in metropolitan Seattle, Washing- ments have been commonplace in faster ton, and Pima County in metropolitan growing areas of the South and West, but Phoenix, Arizona, have encompassed large have remained more limited or exceptional portions of the metropolitan area, and in the Northeast and other areas of older have often addressed issues on a metro- settlement. On the whole, recent counter- politan scale. In a few small-to-mid-sized trends toward creation of new municipal- metropolitan areas, such as Jacksonville, ities have offset counter-trends toward Florida, and Sacramento, California, con- consolidation. From 1992 to 2002, the solidation of city government into county number of municipal governments government has created what amounts increased by 150 to 16,504 (U.S. Bureau to a metropolitan government (Leland and of the Census 1992, 2002). Thurmaier 2004). Advisory regional coun- cils of governments, a legacy of federal requirements for transportation planning, Much more than in Canada and other countries, inter-local frequently provide a basis for coordina- tion of planning issues. Most states also governance in the United States has taken place through authorize cooperation among local gov- separate, special-purpose district governments that are ernments (Richardson, Gough and Puentes 2003). independent of local governments Much more than in Canada and other coun- Local government consolidation has been tries, inter-local governance in the United only one of several types of arrange- States has taken place through separate, ments that could foster inter-local gover- special-purpose district governments that nance within metropolitan regions. An are independent of local governments. The upper tier of local government or a new largest number of these (13,506 in 2002) form of functional cooperation among administered separate public school sys- municipalities may also provide mecha- tems across the country. Others deal with nisms for this task. Practical moves in water and sewers, hospital services or this direction over the past decade have transportation. Although the total number taken a variety of forms. of these districts (48,588), as counted by the U.S. Census of Governments, exceeds Canadian provinces and municipalities have the number of traditional local govern- undertaken some of the most far-reaching ments (35,933), the actual number of spe- reforms in metropolitan governance. cialty, inter-local districts is probably Mainly in eastern Canada, reorganiza- higher. The number of school districts tions in most metropolitan areas have declined slightly (900) from 1992 to 2002, produced more encompassing metropolitan typically due to consolidation among units of governance. Alongside the consoli- municipalities within metropolitan areas. dations of municipalities, regional bodies But the number of other special districts in- have been formed in three provinces, and creased by 3,500 over the same period. In metropolitan planning initiatives have Canada too, most primary and secondary taken place in a number of the largest met- education is administered by school boards ropolitan areas (Rivard and Collin). independent of local government, and a number of agencies, boards, and commis- Such a move is less apparent in the United sions see to special functions jointly shared States. Only a few of the large metropoli- among municipalities. Unlike their U.S., tan areas, such as Portland, Oregon, and counterparts, however, these boards do not Minneapolis-St. Paul in Minnesota, have have independent powers of taxation. NORTH AMERICA Decentralization and Local Democracy in the World 241 Decentralization has attracted the most and less pronounced than the conse- critical attention in the United States quences of cross-border integration across where both local government powers and Europe. The most notable impact has oc- local geo-political fragmentation have curred in the cross-border regions of Cas- remained extensive. Patterns of local cadia in the Pacific Northwest mainly governance there have been found to between the provincial and state govern- exacerbate inequalities among de facto ments (e.g., Blatter 2001). segregated groups by means of inequali- ties in local services (Joassert-Marcelli, III. Functions, Management Musso and Wolch 2001; Blakely 2000). In and Finance particular, inequalities in educational opportunities in the United States have III.1.Finance generated widespread debate and many reform initiatives. In terms of its place in public expendi- tures, public finance and functions, local The wider effects of regional integration government in Canada and the U.S., between North American countries for occupies an average place within the local governance are difficult to discern, spectrum of developed countries. In the Table 2 Financial Management Australia Canada New Zealand United States Total Public Expenditure (% of GDP) 37% 42% 42% 35% (per capita) (Euros) 11,486.56 13,717.90 9,692.57 14,507.04 Local Public Expenditure (% of GDP) 2.4% 7.5% 3.9% 9.6% (per capita) (Euros) 275.68 1,031.16 380.50 1,386.30 Local/Total Public Expenditure (%) 6.6% 17.8% 9.4% 27.4% Local/Total Public Investment (%) 6% NA 16% 8% Local Revenues: Local taxes (% of local revenues) 38% 41% 58% 38% Property tax (% of local taxes) 100% 92% 91% 72% Local tax autonomy (0 (high) - 2(low)) 0.34 0.12 0.43 0.82 Grants (% of local revenues) 16% 40% 10% 39% Sources: (Public expenditure) OECD in Figures 2005; (Local expenditure) IMF Government Finance Statistics (Australia, Canada, US: 2001, New Zealand: 2003); (Local Revenues, Taxes and Grants) IMF Government Finance Statistics (Australia, Canada: 2001; US: 2000; New Zealand: 2003): (Local tax autonomy, Supervision of borrowing) Sellers and Lidström 2007, Table 4; (public investment) U.S. Bureau of the Census, 2005 Statistical Abstract of U.S. Section 9; Compendium of Government Finances: 2002 Table 1; (Australia and New Zealand) Brilliantes et al. 2007, Table 4. NORTH AMERICA 242 Decentralization and Local Democracy in the World United States, the role of local government payer resistance in some states, other local has generally been more pronounced, but in taxes, such as sales taxes, income taxes and Canada that role still exceeds local govern- user fees grew from 22% of local tax rev- ment powers in other countries with similar enues in 1975 to 28% in 1999. Even so, the British colonial legacies, including Australia property tax has continued to supply 72% of and New Zealand. The relative discretion local tax revenues (OECD 2001). that North American local governments exercise over their own finances, and the A distinguishing feature of the property modest supervision by higher government taxes, as well as most other local taxes officials also set local government in both in these countries is the comparatively countries apart from most of their counter- large degree of discretion local authori- parts worldwide, including in Europe and ties possess in setting rates and in East Asia. assessing property. Ratings of local tax autonomy consistently show this discretion In both countries local governments have in recent years to be high compared with that seen in other countries. In the United States, the found themselves less reliant on grants from higher level laws of some individual states restrict local governments for local revenues initiatives to raise taxes or change assess- ments by requiring prior approval by local voters. In Canada, setting these rates is Expenditures. Overall, the proportion of almost always left to the discretion of local Gross Domestic Product (GDP) devoted to government but subject to control by the governmental expenditure in Canada and provinces. the U.S., remains somewhat lower than the average for the OECD (Table 2). The local In both countries local governments have government portion of this expenditure, in recent years found themselves less though it varies considerably, also remains reliant on grants from higher level govern- below levels reported for Northern Europe. ments for local revenues. In the United In Canada and the United States, 18% and States and Canada, state or provincial 27%, respectively, of public expenditure grants for education and other services was distributed to local governments. The remain considerable but modest by com- bulk of these distributions is spent on edu- parison with many other OECD countries. cation. Education consumes 57% of all local The current 39 percent of total revenues in expenditure in the United States, and 40% the U.S. represents a decline from levels of in Canada. Security services such as police up to 45 percent in the late 1970s, but has and fire represent about eight percent of fluctuated over the 1990s and early 2000s. local expenditures in the United States, nine The current 40 percent in Canada repre- percent in Canada. In both countries, local sents a decline from levels as high as 50 public expenditures as a percentage of the percent in the late 1970s, down 2 or 3% total public expenditure have also crept from levels in the 1980s (OECD 2001). upward slightly in recent years. Revenues in relation to tasks. Despite Revenues. Locally raised revenue pays dwindling access to funds from above, as for most educational and security expendi- well as local opposition to tax increases, tures. As in other former British colonies, local governments in Canada and the such as Australia and New Zealand, the United States have assumed more respon- property tax remains by far the most sibilities. Additional areas of responsibility important source of local government rev- that are increasingly being delegated to enue. In Canada, it has generated 80% to local governments include: environmental 90% of all local tax revenues. In the regulation, planning, transportation, public United States, partly in the wake of tax- health, immigration, education, emergency NORTH AMERICA Decentralization and Local Democracy in the World 243 preparedness and security. Even so, the programs in order to provide resources for fiscal autonomy of local government in the new standardized tests. these countries makes local governments especially vulnerable to unfunded man- Local government borrowing. In the dates. Higher-level governments some- face of such pressures, there have been times contribute funds for these added shifts in restrictions on local borrowing. tasks through legislation and new policies. This practice has been most widespread in But higher-ups can impose such tasks with- the United States (Sbragia 1988). out contributing funds, leaving local gov- Although often conditioned upon local ernments to cope as best they can. voter approval, borrowing by local govern- ments is subject to approval by a higher In Canada, the Federation of Canadian level government in only one state. In Municipalities has noted an increase in the Canada, local borrowing sometimes gener- delegation of responsibilities to municipali- ally requires approval by a provincial ties. Although the local government por- board, and has been more limited. In both tion of expenditures remained stable rela- North American countries, local govern- tive to the provincial level from 1990 to ments have also turned to user fees and 2000 ­increasing in some provinces but other charges to supplement revenues. declining in others (Diaz 2003)­ local rev- enues as a percentage of the whole have III.2. Functions decreased. In the United States, despite the federal Unfunded Mandates Act of 1995, the The limited role of local government in the federal government has imposed such overall public expenditure and revenue of measures as the No Child Left Behind Act of these countries reflects limits in the func- 2002, which gave state governments incen- tions that local government has assumed. tives to administer regular tests as meas- With the exceptions of local education and ures of performance for public schools. The public safety, local governments continue resulting programs in many states gave rise to play a subsidiary role to central and to accusations that the Act really just forced intermediate level governments in the broad school districts to abandon more worthwhile run of public policies (Table 3). In recent Table 3 Local Government Functions Functions Australia Canada New Zealand United States Planning Housing State, Local Province, Local (DS) Central, Territorial (DS) Federal, Local (DS) Town planning Local Province (DS), Local Regional Local Agriculture land planning State Province, Local (DS) Local State (DS), Local (DS) Regional planning Local Regional State (DS), Local (DS) Education Pre-school State Province Central Local (DS) Primary State Province Central Local Secondary State Province Central Local Vocational and technical State Province Central State, Local Higher education Federal, State Federal Central State NORTH AMERICA 244 Decentralization and Local Democracy in the World Table 3 Local Government Functions (Continued) Adult education State Province Central State, Local Other State Central Provision of social services Kindergarten and nursery State Province Central State, Local (DS) Family welfare services State Province Central Federal, State, Local Welfare homes State, Local (DS) Province, Local (DS) Central Social security Federal Province Central Federal Others Territorial (DS) Provision of health services Primary care Federal Province Central (Private) Hospital State Province Central Federal, Local (DS) Health protection Federal, State, Local Federal, Province Central, Territorial Federal, State, Local (DS) Mental hospital State Province Central State Water supply Water and sanitation State, Local Local Territorial Local (DS) Water supply State, Local (DS) Province, Local Territorial Local (DS) Energy supply Gas services State Province Central, Regional Local (DS) Electricity State Province Territorial (DS) Local (DS) Public transport Roads State Local Central, Territorial Federal Transport State Local Central, Regional, Territorial State, Local Urban roads State, Local Local Territorial State, Local Urban public transport Local Local Territorial State, Local (DS) Ports State Federal, Province, Local Territorial (DS) Local (DS) Airports State Federal, Province, Local Central(DS), Territorial(DS) Federal, Local (DS) Other transportation Federal, Local (DS) Business development support Agriculture, forests, and fisheries Federal, Province, Local (DS) Federal, Province Central, Territorial (DS) Federal, State Economic promotion Federal, Province, Local (DS) Province, Local Central(DS), Territorial(DS) State, Local (DS) Trade and industry Federal, Province, Local (DS) Federal, Province Central (DS) Federal, State, Local (DS) Tourism Federal, Province, Local (DS) Federal, Province, Local Cen(DS), Reg(DS), Terr(DS) State, Local (DS) Other economic services Federal, Province, Local (DS) Central(DS), Territorial(DS) Local (DS) Security Police State Local (generally) Central, Regional Local Fire State Province, Local Regional, Local Local DS: Discretionary Services by the local authority. For Australia, provinces includes territories. Sources: Commonwealth Local Government Forum (2002a, 2002b, 2002c); Stephens and Wikstrom. 2000, p. 156; supplemented by author's research on government websites. NORTH AMERICA Decentralization and Local Democracy in the World 245 years, however, local governments have especially in urban areas in Canada. In become more active in a wide range of pol- both countries, cultural services, such as icy domains in both countries, mirroring museums, may also fall to local govern- certain global trends. The most wide- ment along with some responsibility for spread trend has been toward the growth local infrastructure, and fire protection or of multilevel governance as both local gov- health services. ernments and higher-level governments assume new roles in areas where they Over the past four decades, there has were less active before. been a gradual expansion in the number and types of responsibilities local govern- Local government functions. Local go- ments have taken on. However, most have vernments in Canada and the United involved some sharing of responsibilities States take on certain functions that are with higher government tiers. In several unusual in most established democracies. domains where local governments have The greater local expenditure in the North become more active, such as environmen- American nations stems largely from local tal policy, waste management, public government responsibilities in education health, and transportation, authorities at and public safety. In the United States, the national, provincial or state level may individual states assign to local govern- play as decisive a role as local authorities. The greater local ments responsibility for primary, second- ary and pre-school education, as well as Shifts in local service provision. One of expenditure in the for police and public safety. These tradition- the most far-reaching recent transforma- al areas of local responsibility have tions in provision of local services has been North American become more complex in recent years, but the shift toward privatization. Contracting nations stems have remained comparatively stable in for services with private businesses or non- recent decades. profit organizations has become a common largely from local practice among local governments in the government Canadian provinces and U.S. states vary United States. For the most part, this has widely in their responses to other functions come about without the legal mandatesthat responsibilities in relegated to local government. Several have spurred privatization in New Zealand or education and provinces and states, for instance, have Europe. In the U.S., privatization is now their own policies for land use and agricul- well-established as a pragmatic alternative publicsafety tural planning; others have set down spe- when other resource channels will not cific mandates for local planners to follow. serve. In surveys, two thirds or more of In most states and provinces, however, local managers report that privatization planning remains predominantly a local has been considered and approved as an function. Provision of health and social alternative to public provision (ICMA services also varies. Some states and 2003). After a surge in the 1990s, it seems provinces have enacted legislation that safe to say that privatization has been a gives localities more responsibility for wel- staple of local government since 2000. fare services, hospitals and other matters. Although privatization has been on the Ontario, for instance, assigns localities agenda in Canada as well, it has not been authority for administering social security pursued as aggressively as it has in the and kindergartens; other provinces do not. United States. Even so, in neither country has the shift to privatization been as dra- Environmental services, planning, building matic as it has been in Australia, New permits, land use, sanitation, and refuse Zealand, and some European countries. collection usually require some local responsibility, as they do in many coun- Local entrepreneurship, in the sense of local tries. Even road maintenance may require ownership of utilities, transport authorities, some local government participation, and facilities, is more limited than it is in parts NORTH AMERICA 246 Decentralization and Local Democracy in the World of Europe. However, it is common to find local United States more than 60% of all gov- governments generating revenue through ernment employees work in local govern- administration of airports, ports and other ment. This rate approaches that of the commercial operations. In the United States, Nordic democracies or Japan, where much special authorities controlled by local govern- of the welfare state is administered locally. ments typically take on these administrative In Canada the proportion is lower but still The overwhelming roles. The city of Los Angeles, for instance, considerable at 35%. derives a large portion of its revenue from Los proportion of the Angeles International Airport and the Port of These contrasts owe largely to the differen- additional local Los Angeles. ces in the functions local government has assumed. Although local government in personnel in the III.3. Administrative Capacity Canada and the United States is not United States responsible for large public health sectors The size of local government staffs varies and social benefits as in the Nordic coun- works in the widely. This has not prevented implemen- tries, it retains responsibility for some of localized education tation of largely parallel practices designed the most labor-intensive public social serv- to secure integrity in local government, to ices. The overwhelming proportion of the system, and in both carry out management reforms, to intro- additional local personnel in the United North American duce at least limited elements of e-govern- States works in the localized education sys- ment, and to pursue policies supporting tem, and in both North American countries countries public gender equality. public safety officials also make up much of safety officials local government staff. The additional sec- Personnel. Far more people work in local tors of social service, health, infrastructure also make up much government than might be expected in and educational provision in Canada also light of the comparatively modest expendi- employ personnel who work at provincial or of local tures at the local government level (Table national levels in Australia and New Zealand. government staff 4; compare with Table 2 infra). In the The low staffing levels in these countries Table 4 Government Personnel, by Level of Government Name Australia Canada New Zealand United States Total 1,485,800 2,552,613 227,220 19,869,558 National 248,500 357,308 205,540 2,878,819 Federal units 1,090,600 1,313,379 4,370,562 Local 146,700 881,926 21,680 12,620,177 Percentages National 17% 14% 90% 14% Federal units 73% 51% 22% Local 10% 35% 10% 64% Years: 2000 (United States), 2001 (Australia, Canada, New Zealand). Source: OECD 2002. NORTH AMERICA Decentralization and Local Democracy in the World 247 also reflect the consequences of systematic sions for ethics in local government are policies that have contracted out more of part of a more general system of norms infrastructure and local services. applied to all public employees within a state or province. Measures of this kind The growth of local government in the have helped to assure comparatively high United States has outstripped that at other standing for public officials in these coun- levels. While the federal government has tries (World Bank 2006). declined as a proportion of all government personnel, and the state governments have maintained essentially the same pro- Adistinguishingcharacteristicoflocalgovernment portion, local governments now hire four in both countries is the absence of a national civil service percent more government employees than in the 1980s (U.S. Department of Com- for local government merce 2006). In Canada, local government employment declined along with public employment over the course of the 1990s. It has been rising again since 2002 (Statis- Reforms and management initiatives. tics Canada 2006: pp. 6-7), roughly in Efforts to improve quality and efficiency tandem with growth in provincial govern- have proceeded steadily at the local level in ment employment. the United States and Canada, though it is difficult to assess how much difference these Public service rules and guarantees for efforts have made. Professional organiza- employees. A distinguishing characteristic tions like the International City/County of local government in both countries is the Managers Association have sought to pro- absence of a national civil service for local vide benchmarking studies and best prac- government. In most other developed tices guidelines for these local efforts. countries, either a national civil service or a national local civil service dominates local E-government. A growing majority of government staffing. But in North America, local governments in both countries have municipal hiring is by individual, private adopted "e-government" practices. Most law contract. Although there are civil serv- local governments now have websites; ice systems in many local governments, larger municipalities use these to distrib- the character of these varies widely (e.g., ute increasing volumes of public informa- Freyss 1995). Partly as a consequence, many tion. Local e-government varies widely in local government employees are recruited scope and amount. Studies in the United locally. Within specific domains of local States show that it is most extensive and government activity, professional creden- widespread among wealthier communities tialing and certification often provide a par- where residents can easily afford comput- tial substitute for civil service standards. ers, and are apt to be highly educated This is notably true in the United States, (Reece 2006). Several municipalities and where public school teachers, police offi- some state and provincial governments cers, firefighters and financial officials must have moved beyond passive online con- have professional accreditation and associ- tent. In Canada, Nunavet and Yukon have ated training. "introduced legislation which allows coun- cil and committee meetings to be held Mechanisms for enforcement of public electronically." (UNESCAP 2005). integrity are present in each country. Most U.S. states and Canadian provinces have Gender equality policies. In both coun- enacted codes of conduct for public ethics tries, an array of general workplace guar- that include openness and proper resolu- antees of civil rights extend protections on tion of conflicts of interest. Often provi- gender equality to local governments. NORTH AMERICA 248 Decentralization and Local Democracy in the World IV. Local Democracy mayors of lower-tier authorities are gener- ally elected. But in rural authorities, the In the workings of democracy at the munic- mayors, reeves and wardens who exercise ipal and other local levels, Canadian and executive authority are generally U.S. local governments maintain some of appointed by councils. their most distinctive practices. Non-parti- san elections, single-member electoral dis- IV.3. Council Voting Systems tricts, frequent elections, direct democracy, and greater local choice of institutions set Council voting systems vary, but display local institutions in these countries apart. A some overarching commonalities. Although number of these practices mark clear di- the single-member district method of elec- vergences from inherited British traditions, tion is part of the British local government as well as from the institutions in comparable tradition, in the United States at-large elec- countries like Australia and New Zealand. tions have grown to predominate. In a 2001 city council survey 45% of councilors in IV.1. Parties and Partisanship cities with populations over 25,000 reported this form of elections, compared to 28% In Canada and the United States the over- with ward elections and 26% with a mixture whelming proportion of local elections are (Svara 2003; p. 13). Among cities over Voters in the United non partisan. Canadian candidates tend to 200,000, however, ward elections remain States and Canada be listed either as independents, or to be most frequent. In Canada as well, the type affiliated with local, rather than national of representation varies among and within often have the parties (UNESCAP 2005b). Even when provinces. There the ward system with first opportunity to vote national politicians run for local office, the past-the-post voting generally predomi- links between local elections and national nates. more frequently for party organizations remain loose. In the local officeholders U.S., most states, particularly those in the IV.4. Citizen Participation "reform" areas of the South and West, than do their require elections to be non-partisan. In One of the distinguishing features of local counterparts in larger cities, partisan affiliations are often government in Canada and the United well known even in formally non-partisan States has been the greater extent of par- other countries elections and can play an important role. ticipatory opportunities for local citizens. Electoral terms are short, elected offices IV.2. Elected Executives often more numerous, direct democratic procedures like recall and referenda more Although a variety of arrangements char- widespread, and citizen commissions have acterize local elections, several broad insti- long been a regular feature of local gov- tutional patterns have predominated ernment. (Table 5). In the United States some 38% of municipal governments feature a Voters in the United States and Canada mayor-council system, with an elected often have the opportunity to vote more mayor who often exercises considerable frequently for local officeholders than do independent authority (MacManus & Bul- their counterparts in other countries. The lock, 2003 pg. 3). This arrangement is three years that correspond to the average most common in larger cities. A growing term in U.S. cities for elected executives majority of U.S. cities ­a 2001 survey esti- and councilors, and corresponding practices mated the proportion at 53%­ have in Canada, represent only one dimension adopted instead a council manager sys- of this additional opportunity. Even for tem. In this system the mayor is elected councils with four-year terms, the terms by the council from among its members are often staggered so as to schedule an and usually has few powers. In Canada, election for part of the council every two NORTH AMERICA Decentralization and Local Democracy in the World 249 years. In the U.S. there are often multiple Ohio and Washington State. Canada also local electoral offices, including boards, has a long tradition of referenda (Hahn local administrative officials and some- 1968). With the exception of three-year times local judges. Recall elections for council terms, these practices set both local officials are authorized in around half countries apart from fellow former colonies of U.S. states. In California these have be- Australia and New Zealand. come a regular occurrence. Term limits in a growing number of U.S. localities have Participation in local elections is relatively also prevented incumbents from holding low, conforming to the international trend on to safe seats. Finally, referenda are a of higher voter turnout for elections at more regular feature of local politics in higher levels. This tendency is particularly much of the United States than in any pronounced in the United States where country other than Switzerland. Although electoral turnout has been lower than it is resort to direct democracy varies widely by in other countries affiliated with the state and region, voting now plays a major Organisation for Economic Co-operation role in transportation, infrastructure and and Development (OECD). Local election public finance in such states as California, turnout as a proportion of the eligible pop- Table 5 Local Democracy Local councils Local executive Direct democracy Proportional/ Constituencies Term Mode of Term Collegial / Recall majority rule selection unitary Australia preferential or plurality One 3-4 years Mostly popular 3-4 years Unitary No Infrequent systems (4 states), election, some preferential or indirectly election proportional representation (2), proportional representation (1) Canada Generally, plurality Multiple 3 years, Direct election 3 years, Unitary No Frequent: for 4 years or (8 provinces), 4 years or taxes, planning 2-3 years indirect election (2) 2-3 years New Zealand Plurality Multiple 3 years Direct election 3 years Unitary No Occasional, infrastructure and electoral rules United States Mostly plurality, Multiple, one 3.3 years Direct Generally Collegial Authorized Frequent or some multimember and mixed on average election (50%), 2-4 years (5%), in half of very frequent: districts and single indirect election (3 on average) Otherwise states, revenues, nontransferable (50%), unitary occasionally infrastructure, vote systems used annexation issues Sources: Bush (1995); Commonwealth Local Government Forum (2002a, 2002b); International City/County Management Association (1997); McManus (1999); Mouritzen and Svara (2002); United Nations Economic and Social Commission for Asia and the Pacific (2002a, 2002b ); Zimmerman 1997; Canadian provincial and territorial local government acts. NORTH AMERICA 250 Decentralization and Local Democracy in the World ulation has been estimated as low as 10% municipal government in the provinces (Hajnal and Trounstine 2005). A study of and states offer a choice among a variety five major U.S. metropolitan areas from of different legal forms, as well as discre- 1996 to 2003 showed an average turnout tion to choose different voting systems, of 29% for municipal elections, compared executive forms, and other electoral with an average turnout of 57% for the processes. As a practical matter, choices presidential election of 2000 (Sellers and vary only moderately among a limited Latner 2006). In Canada, where the only number of standard types, often depend- available measures are for the major ing on population size and the rural or cities, local election turnout since the 1990s urban character of a jurisdiction. Especially ranged between 41% and 49% of the eligi- in the areas of later European settlement ble population in general election years, ­outside the northeastern region of the and between 31% and 39% in off-year United States, for example­ state laws for elections. annexation and municipal incorporation facilitate the formation of new local gov- The traditional New England town meeting, ernments as well as the public annexation a legislative assembly of citizens them- of land. Throughout the U.S. and in a num- selves, survives today in only a very small ber of Canadian cities, many larger city proportion of U.S. local governments. But governments have been maintained citizen commissions and boards remain a through a specifically legislated charter regular feature of local government under the state government. This leads to Representation throughout Canada and the United States, even more distinctive institutional and several municipalities have adopted arrangements for each such city. A charter of racial and ethnic innovative new forms of citizen participa- of this kind enables higher-level govern- minorities tion in recent years. Several larger cities of ments to establish the local government's Canada and the United States have structure, fiscal authority and other pow- continues adopted systems of neighborhood-level ers for each city. Local authority of this to pose problems councils with elected representatives kind is unusual in Europe, or even Aus- (Berry et al . 1993; Rivard and Collin tralia and New Zealand, although it is fairly in both countries. 2006: 7). Most of these councils have common in developing regions. been confined to advisory powers. In a few cases, such as the borough system of New IV.6. Local Political Representation York City and the neighborhood councils of San Antonio, sub-municipal councils of this Representation of women in local govern- sort also exercise governmental powers. A ment has increased in recent decades. In a few Canadian municipalities have also 2001 survey by the U.S National League of experimented with such innovations as Cities, 28% of city council members were participatory budgeting. New practices in female, two percent more than in 1989 such functional areas as planning have (Svara 2003, p. 5). In the city councils of also included consultations with neighbor- large cities, as well as `liberal' states like hood associations and even individual res- New York, the number has risen to more idents in the preparation of local develop- than 30% (ibid.; Anthony Center: 2006). ment plans. In 2002, 17% of mayors in cities with pop- ulations of 30,000 or more were women IV.5. Choice of Localities to Determine (Conway 2005: 60). Female repre- the Shape of Their Own Institutions sentation was highest, 44%, on local school boards (ibid.). In Canada the pro- In Canada and the United States, local portion is somewhat lower. A 2004 national governments have historically exercised survey by the Federation Canadian of considerable authority over the shape of Municipalities reported that only 21.7% of their institutions. General laws governing municipal councilors were women (Federa- NORTH AMERICA Decentralization and Local Democracy in the World 251 tion of Canadian Municipalities 2004: 9), negotiators for British Columbia to agree with much lower representation of women to a protocol that guarantees local govern- from minority ethnicities. ment representatives a place in treaty negotiations. Representation of racial and ethnic minori- ties continues to pose problems in both On the 550 Indian reservations in the countries. In the United States, with the United States, the tribal government is the rise of majority-minority jurisdictions in local government authority. Reservations many central cities, African-American, are exempt from certain taxes, such as Latino and Asian-American representatives state sales taxes, and often maintain their have in many places acquired a significant own tribal courts. The isolation and or even predominant role in local councils. poverty of many reservations makes set- In cities of all sizes ­especially in the tlements some of the poorest in the coun- largest ones­ surveys indicate that minority try (Kalt and Cornell 2000). representation doubled from 1979 to 2001 (Svara 2003: p. 7). But studies continue to IV.8. Decentralization and Oversight show under-representation of minorities in of Local Government relation to their numbers, a situation often In some cases, linked to low electoral turnout and other Adhering to the British system that influ- relations between factors (Hajnal and Trounstine 2005). Sim- enced the early development of these coun- ilarly, a 1998 analysis of council members tries, higher-level governments in Canada indigenous local in Montreal showed only 29% from the and the United States do not rely on the ter- practices and local ethnic minority groups that comprised ritorial representation of a prefect, or a com- 43% of the total population (Simard 2000: parable general representative at the local government have p. 17). level. In the federal systems of the two coun- tries, separate departments of the states, become enmeshed IV.7. Traditional Institutions provinces and territories provide general in renewed debates oversight. In Canadian provinces and territo- In particular regions in both countries, ries, Ministries or Departments of Local Go- about indigenous indigenous populations from the years vernment provide this function. In the U.S. claims to land title before European settlement continue to states, the Secretaries of State generally maintain traditional institutions that can have this responsibility. In both countries, andformsof alter or replace the workings of other the oversight activities include supervision of sovereignty local governments. In some cases, rela- local elections, administrative records, and tions between indigenous local practices other requirements including those for ba- and local government have become lanced budgets. enmeshed in renewed debates about indigenous claims to land title and forms National governments in both countries have, of sovereignty (Langton et al. 2004). for several decades scaled back direct inter- Wider systems for providing services and vention into municipal affairs. Canada elimi- maintaining infrastructure have also had nated its federal ministry of urban affairs in to be modified to accommodate local self the 1970s; the Department of Housing and government through traditional institu- Urban Development (HUD) in the U.S., has tions. also reduced its role. However, the national governments have undertaken some initia- In Canada, where there are some 1500 tives in recent decades, intervening directly in indigenous tribes, a series of treaties since local affairs. In Canada, the creation of a Mi- the 1970s has established the right of First nister of State for Infrastructure and Commu- Nations to self-government (Morse 2004). nities in 2004, which became the Minister for The need for cooperation with the local Transport, Infrastructure. In certain areas, governments has led First Nation treaty such as grants for housing or community de- NORTH AMERICA 252 Decentralization and Local Democracy in the World velopment or the administration of national and Canada, however, the public opinion of parks in the United States, direct intervention local government appears to be somewhat of this sort bypasses officials of state and more positive. provincial governments. In areas like trans- portation planning or regulation of air and Since the 1970s in the United States, the water pollution, the federal government in public has placed growing trust in local the United States has enlisted state govern- government, particularly in comparison ments in national regulatory schemes, and with government at higher levels. In 1972, sometimesworksalongsidestateofficialsatthe a Gallup survey showed that 12% placed local level. "a great deal" and 51% "a fair amount" of trust in local government ­ a total of 63%. Higher-level governments, therefore, do In 2005, 23% expressed "a great deal" of retain some broad powers to oversee local trust and 47% "a fair amount" ­ a total of affairs, and to intervene in local govern- 70%. From 2001 to 2004, the proportion ment activities. Canadian provincial minis- in both categories averaged 5 % higher ters responsible for local government, in than trust in state government, and eleven addition to broad oversight and approval percent higher than trust in the federal go- powers, can go so far as to dissolve local vernment. Since the 1970s in councils and appoint administrators to the United States, carry out local government functions. In In Canada as well, a recent survey showed the United States as well, state govern- skepticism about the performance of the fe- the public has ments are generally empowered to take deral government, but positive assessments over administration of local governments of the performance of local government in placed that default on financial obligations or oth- facing local issues (Infrastructure Canada growing trust in erwise fail. This has occurred, for instance, 2006). Fifty three percent of respondents in the takeover of the urban Philadelphia rated local governments "excellent" or local government, school district by the state of Pennsylva- "good" in addressing these issues. This com- particularly in nia. These powers are also typical of pared with 37% for provincial governments, higher level governments in other systems and 32% for the federal government. comparison with with British colonial legacies, including, government at once more, Australia and New Zealand. IV.10. Local Government Associations higher levels Among politicians, the holding of multiple As in other countries with highly devel- electoral mandates offices for local and oped systems of local governance, state or national office is rare, and is national associations of local govern- largely, if not entirely, prohibited by con- ments and local government officials play flict of interest laws. Although politicians diverse roles. The Federation of Canadian have often moved between offices at dif- Municipalities (FCM) began in 1901 as ferent levels, they do so through a succes- the Union of Canadian Municipalities. In sion of posts. In U.S. states, where term the United States, the National League of limits have increasingly restricted the Cities (NLC) was founded in 1924, and number of mandates a politician can serve, the United States Conference of Mayors moving between state office and local in 1932. Much of local government legis- office has become increasingly common. lation is a matter of state or provincial and territorial law. Local government IV.9. Public Opinion on Local Government associations formed within these inter- mediate levels of government are also As in most advanced industrial democra- very active and influential. Associations cies with longstanding institutions, skepti- of local professionals, such as the Inter- cism about public officials and politicians national City/County Management Asso- has increased. In both the United States ciation, have also been a major factor. NORTH AMERICA Decentralization and Local Democracy in the World 253 One of the most important roles that contrast, the U.S. national organizations these organizations have served is as have in recent decades scaled back corporate representatives of the inter- efforts to influence national policy. State ests of local governments in national and or provincial organizations of municipal state or provincial policymaking. The governments are often more active at U.S. Conference of Mayors (USCM), for these lower levels of government, where instance, emerged in the 1930s from the most policies and frameworks for local first successful efforts by a coalition of governments are crafted. mayors to secure a package of federal financial aid targeted to city govern- IV.11. National Organizations Also Take ments during The Depression. The Cana- on Other Roles dian Federation of Municipalities (FCM) has increasingly gained recognition as a Documenting and disseminating best prac- voice for protection of the rights of tices and information about local govern- municipalities in national debates. By ment has been a goal for all of these asso- NORTH AMERICA 254 Decentralization and Local Democracy in the World ciations. This role has been especially ally among local governments has also prominent among the national associations been an important element of these activi- in the United States. The National League ties. As part of its initiatives for local capac- of Cities (NLC) maintains a database of ity building, the FCM has established the local government practices, and a Munici- Center for Sustainable Community Devel- pal Reference Service that collects informa- opment (CSCD). The FCM also maintains a tion on local government activities around Green Municipal Fund (GMF), a unique the country. Both the NLC and the Interna- $550 million endowment from the federal tional City/County Managers Association government devoted to environmental sus- regularly conduct surveys of local govern- tainability and local capacity building. Since ments. Their surveys have become the 1987, Canadian municipalities have most important source of information on authorized an International Center for broad trends at the local level. In the U.S., Municipal Development to represent the national forums linked to the USCM and the FCM in international work. In both coun- NLC bring local officials together regularly tries, international partnerships have pro- to discuss issues of common concern. Net- liferated outside as well as within the aus- working both domestically and internation- pices of national associational activities. NORTH AMERICA Decentralization and Local Democracy in the World 255 V. Conclusion In both Canada and the United States, local of local government, the shifting of government has evolved quite far from its responsibilities to the local level, and the original British colonial legacy. Their parallel search for new inter-local and public-pri- evolution has given these settler nations a vate arrangements for governance show distinctive type of local government that few signs of abating. can be understood only partly through com- parison with contemporary British local gov- In the United States, local government has ernment, or even with local government in thrived even as it has confronted wide- other former British colonies. Long-standing spread decentralization, greater supervision, features of these systems include limited intergovernmental fragmentation and an legal status, comparative local fiscal auton- increasingly limited role in national policy. In both Canada and omy, a modest municipal role in overall Local government powers in some states the United States, public finance, a strong role in local civic include general authorizations like those of action, and an emphasis on local democ- Northern Europe, and overall, local gov- local government racy. By comparison with Europe and East ernment has one of the highest propor- has evolved quite Asia, these systems may seem to embody a tions of public employment in the world. limited role for local government. But that Both this proportion and the local govern- farfromitsoriginal role is also much more institutionalized and ment portion of public spending continue British colonial robust than in many newly decentralizing to rise. The growing trust of citizens in countries, and less subject to supervision local government suggests that this legacy from above than in most of the developed growth will continue. North. Canadian local governments traditionally Within both countries, but especially within possess more limited powers and fiscal re- the United States, considerable variety sources than do those in many U.S. states, continues to mark local governance. Local but this may be changing. Local govern- government remains subject to different ment representatives have lobbied for legal frameworks by state or province, and strengthening these powers. New go- even by individual city. Informal and for- vernmental units, and planning at the me- mal inter-local arrangements also differ tropolitan level have taken hold, and the widely, even across a single metropolitan trust of citizens in local government re- area. Such common trends as the growth mains high. METROPOLITAN GOVERNANCE JEFFEREY SELLERS VINCENT HOFFMANN-MARTINOT METROPOLITAN GOVERNANCE 258 METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 259 I. Introduction South and the North have grown into domi- nant components of metropolitan economies. Worldwide, metropolitan regions (also re- As economic globalization has increasingly ferred to as "urban regions" or "city regions") linked urban regions to each other, and cities are rapidly becoming the predominant to their peripheries and hinterlands, competi- form of human settlement. In 1800 only tion among cities and regions has intensified. 2% of the world's population lived in urban Atthesametime,widespreaddecentralization areas. Five years from today ­most likely has encouraged high-level governments to when a villager somewhere in Asia or abandon local governments within metropoli- Africa moves to an urban center there­ tanregionstothemyriadconsequencesofthe the majority of the world's population will ongoing demographic, economic and social be urban. Thereafter, humankind will be, changes. indisputably, an urban species. Social scientists have for many years linked With the industrial revolutions of the 19th urbanization with economic development, and early 20th Centuries, urban regions education and other components of "mod- became the predominant form of settle- ernization" (Ingram 1997). Of course, cities ment throughout most of the global North. are still the centers of economic and social This process of urbanization is now increas- activity worldwide, but in important ways ingly the rule in the global South as well. the dynamics of modernization have For example, most of Latin America is now changed. It is increasingly clear that today's urbanized. The United Nations predicts that metropolitan regions face unprecedented from 2005 to 2030, 90% of all global pop- governance challenges. The size of modern The size of today's ulation growth will take place in urban cities, their continued growth, their social largest urban regions of the global South (UNCHS 2005). and spatial fractures, their distinctive eco- nomic characteristics, and their institutional regions is The size and form of metropolitan regions dimensions present hitherto unanticipated unprecedented in differ considerably, both within countries dimensions of governance. As expanding and between global North and global South metropolitan regions cope with the new world history regions. The size of today's largest urban facts of governance, governments at higher regions is unprecedented in world history. In levels must also acknowledge and address 1950 only one city had a population of more metropolitan issues. Nor is it likely that than 10 million. By 1975 there were five solutions will be simple. Solutions for one cities of this size, three of them in the devel- region may not pertain in another. Each oping world. By 2000 there were 16 cities metropolitan setting, North and South, is in with populations over 10 million, twelve of important respects unique. them in the developing world. However, such megacities like these present only part II. Conditions of Metropolitan of the story. Cities with populations in Governance excess of one million are proliferating world- wide, and the number of cities with more Worldwide urbanization has given rise to than five million inhabitants is also increas- the global phenomenon of geographically ing. As more people are drawn into expand- extended metropolitan regions. This chap- ing urban regions (UNCHS 2005), the ter focuses on governance of these settings, world's metropolises grow more extensive, governance being defined as "actions and more diverse and more fragmented. institutions within an urban region that reg- ulate or impose conditions for its political Simultaneously, changes in the governance, economy" (Sellers 2002, p. 9). Despite the economicsandsocietiescontinuetotransform many forms that metropolitan governments the spatial and social structures of urban take, they confront common challenges shaped regions. Diverse service sectors in both the by parallel shifts in politics, economics and METROPOLITAN GOVERNANCE 260 As markets society. Still, fundamental differences Yetwhenthesocialandeconomicstructures for residence and between Northern and Southern cities make within a metropolitan region are inter- governance a significantly different proposi- connected, decisions and actions taken by employment in tion above and below the equator. one community can easily affect or even undermine the choices made in a neighbo- metropolitan areas Urban growth means territorial expansion ring one. This interconnectedness of metro- diversify, affluent as well as population growth. De facto met- politancommunitiesstandsatthecoreofthe ropolitan borders push thus farther and far- metropolitanproblem. households seize ther out into the surrounding rural area. At the opportunity to the same time, improved transportation Partly for these reasons, metropolitan gover- and communication technologies have nance requires vertical as well as horizontal sort themselves greatly increased the mobility of employers relations among governments. The social and into areas with and residents. Especially in developed economic problems that the higher-level gov- countries, clear dichotomies between city ernments of both developed and developing superior amenities and countryside have given way to dis- countries confront ­ from economic de- and a better quality persed, polycentric patterns of settlement velopment to reducing pollution­ are also in- and economic activity. Many developing creasingly the problems of metropolitan of life areas, such as the Pearl River Delta of regions. Opportunities for governance within China, manifest a similar evolution. these regions are often provided by national policies and institutions. For example, trans- The problem of horizontal governance portation policy determined at a higher level across an extended area confronts all of of government can be coordinated with local these urban regions. Settlement and eco- decisions about economic development. Si- nomic activity frequently expand across milarly, implementation of national or institutionalized boundaries, and beyond regional pollution laws can be facilitated by the reach of stable, pre-existing gover- appropriate local planning; or an overarching nance arrangements. This phenomenon social welfare policy can be coordinated with presents several potential problems: local educational policy. · Absenceofterritorialcontrolsandgui- Other social and economic dynamics in me- dance: Urban spread can be limited and tropolitan areas compound the need for me- restricted only by co-operative action tropolitan governance. Recent research among the affected urban areas. Local go- points to growing socio-economic disparities vernments must look beyond their pa- within many contemporary metropolitan rochial vision and strategy, and make at regions (e.g., Fainstein 2001; Segbers et al. least a minimal effort to acknowledge and 2007). As markets for residence and em- accommodate this crucial spillover di- ployment in metropolitan areas diversify, mension; affluent households seize the opportunity to sort themselves into areas with superior · Shortcomings in management ca- amenities and a better quality of life. Poor pabilities and experience: Small go- households gravitate toward areas with the vernment units find it difficult to attract lowest housing costs. Especially where the and develop the administrative and boundaries between affluence and poverty technical resources required for territo- correspond to boundaries between govern- rial management. Pooling resources mental entities, such as villages or towns, could provide increased efficiency and heightened differences in the number and economies of scale; quality of public services can reinforce social disparities. Without public measures to · Lack of structural consultation for sol- equilibrate the fiscal disparities among locales, ving common problems: Collective action governance arrangements can reinforce by local governments is still the exception. spatial advantages and disadvantages. METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 261 Even beyond the boundaries of metropoli- United States and in a number of European Concentrations tan settlement itself, increased mobility countries. In many Southern metropolitan of poverty and and communication have intensified social regions, however, poverty predominates. The and economic links between urban centers latest survey data suggest that 25% of the slumsmaystillbe and outlying areas. Metropolitan regions, urban population is below the poverty line in found in major like most central cities, function as centers India, 15% in Brazil, 30% in Tanzania, 19% in of production and distribution for the sur- Ghana, 13% in Jamaica, 57% in Sierra Leone metropolitanareas rounding regions. However, they are also and approximately 7% in Vietnam in the United States centers of consumption for outlying areas, (UNFPA:2006). If poverty in the South were providing a strong cultural economy for measured by the same standards applied in and in a number of intellectual life, education and tourism. developed countries, at least half of the urban European countries Indeed, growth inthemetropolisoftencomes populationinmanydevelopingcountrieswould at the expense of rural economies, trigger- be categorized as poor. In developing nations, ing a population influx from rural areas. the urban figure is usually less than the pro- portion of households below the relevant Differences between northern poverty line in the rural areas (UNFPA: 2007). and southern metropolitan regions The most recent UN figures also suggest Within these broad commonalities, urban that one third of the world's urban popula- regions in the developed North and those tion ­ 90% of city dwellers in the develop- in the developing South have distinctive ing world ­ live in slums, defined as areas characteristics and face markedly different with inadequate provision of infrastructure challenges. such as sewers, running water and elec- tricity (UNFPA: 2007). In parts of the South, especially in Asia and Africa, urban regions are growing at unprece- For urban residents in the South, a notable dented rates, faster even than cities grew at measure of informality characterizes em- the onset of urbanization in the North. Flight ployment and housing (cf. Gilbert 1998; from the countryside is driven by rural en- Segbers et al. 2007). While their legal sta- vironmental degradation, disappearing job tus varies with local circumstance, these opportunities and poverty. So dire are con- settlements by definition lie outside the ditions in many rural areas that growth in formal planning and legal system, and are southern metropolitan regions is simply ex- usually built on land that the inhabitants plosive. Although current rates of growth do not own. Such residential areas come in amongcitiesintheNorthvarywidely,theyare many forms and sizes, and most attain de generally lower. In much of Europe, declining facto acceptance by local authorities. Local birth rates and migration present new prob- municipal politicians often use their resi- lems among declining urban populations. dents as sources of patronage and elec- toral support. One result of this acknowl- The populations and forms of peripheral edged but unofficial status has been the settlement also differ. In most of the appearance of a full-fledged underground North, middle class and affluent residents housing market with properties (usually have led a migration from the central cities shacks) being unofficially bought and sold. (Hoffman-Martinot and Sellers 2005). In Because most settlement residents can not most of the South, however, urban regions afford to "own" property, even under such remain generally more concentrated and quasi-legal conditions, there is also a dense, and poor residents typically pre- strong rental market. dominate on the urban periphery. In many developed countries, local gov- Concentrations of poverty and slums may still ernments, planning regimes, property laws be found in major metropolitan areas in the and welfare states institutionalized at the METROPOLITAN GOVERNANCE 262 The growth national level have provided powerful spaces. Many metropolitan areas must deal patterns instruments to steer metropolitan settle- withcontinueddemographicexpansion.Many ment and address resource inequalities. In others must also overcome institutional frag- of metropolitan the South, however, even where compara- mentation due to the lack of a central, en- ble mechanisms exist, they are apt to be compassing regulatory authority. Most, to so- regions are most less extensive and less effective. me degree, also have to cope with new and usefully viewed as sometimes intense local conflicts. In confronting rapid urbanization and the products of both challenges of metropolitan governance in the III.1. Social and Territorial Diversity government and 21st Century, Southern metropolitan areas can find guidance in the growing number and The shape of metropolitan regions today private-sector range of global institutional models. These marks a clear departure from the traditional policies models incorporate international expertise form of cities. Especially in Europe, urban set- about policy in specific sectors, and accumu- tlement has long been understood to follow lated lessons about metropolitan manage- an agglomerative concentric model. Within ment garnered from previous experience with fortifications, behind gates and along great urbanization. But the sheer size and extent boulevards, the European city developed a of the largest urban regions, as well as the distinct economy and way of life. Beyond the growing influence of outside forces and met- city walls lay the economically and adminis- ropolitan interconnectedness, frequently give tratively separate sphere of rural settlement. rise to unforeseen circumstances and daunt- Modern metropolitan regions, however, have ing complexities. far more complex patterns of territorial diver- sity that often blend urban and rural ele- The growth patterns of metropolitan regions ments. Such new patterns are reinforced by are most usefully viewed as products of both social diversity that frequently outstrips that government and private-sector policies. of urban regions in centuries past. Intentionally or not, even the most diverse and expansive metropolitan areas achieved Though it may seem counterintuitive, today certain aspects of their present form partly the fastest growth often occurs in the rural as a result of governmental choices. Such communities on the fringes of urban areas. governmental efforts include extending In the developed countries of the North, this transportation systems, such as motorways, growth is fed by young families looking for trains and other forms of mass transport, homes with more space. Many of these "new designating locations for businesses and re- rural dwellers" left denser urban neighbor- sidents, providing incentives through tax hoods or even established suburbs to live in abatements and other subsidies, and plan- outlying villages. Though they move farther ning suburban habitats. At the same time, from the center of the city, these families individual businesses and consumer housing typically remain dependent on the city for preferences exert powerful, ongoing influ- employment and public amenities. ences on growth patterns. In the developing countries of the South, especially in Brasilia and Mexico City, mid- III. Key Challenges of Governing dle class and affluent households are also Metropolitan Areas moving away from the center of metropol- itan regions. However, an even larger The governance of metropolitan areas is par- number of new arrivals are poor residents ticularly difficult for a number of reasons. of rural areas and poor urban dwellers Whatever the institutional arrangements or seeking affordable housing. the peculiarities of the surrounding region, metropolitan governance must address in- As the urban fabric spreads and stretches, the creasingly extended, diverse, and divided notion of `conurbation' ­a continuous network METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 263 ofbuilt-upurbanareas­hasincreasingly failed III.2. Governmental Fragmentation The largest to capture the fluid and ambiguous nature of urban regions in peri-urban regions. It has given way to meas- Another challenge for governance stems ures of commuting intensity or patterns of from the organizational fragmentation of developed migration toward a central city. Significantly, local governments in extended metropoli- countries generally geographers and urban planners have even tan regions. Much of this fragmentation is invented special terms to describe the new geopolitical. As more people move into an featurehigher entities that are taking shape around large increasing number of communities sur- levels of social and cities: City-archipelago, emerging town, rounding central cities, more local govern- megalopolis, metapolis and metropolitan area ments are drawn into problems that beset economic are a few examples of recent additions to the the entire metropolitan region. segregation by urban-studies lexicon (Ascher 1996; Gottman 1961; Mongin 1998; Veltz 1995). Data from the 476 metropolitan regions in residence the International Metropolitan Observatory Growing social diversity in many urban re- (Hoffmann-Martinot and Sellers 2005) offer gions has contributed to the increase in the most systematic current overview of ground-level territorial diversity. The largest governmental fragmentation in OECD coun- urban regions in developed countries gener- tries; data for several additional cases are ally feature higher levels of social and eco- provided as well. Measured by the propor- nomic segregation by residence. In Europe tion of the central city population in areas of and North America, many such regions have more than 200,000 inhabitants, Israel is also absorbed the largest proportions of new one of the most fragmented countries from immigrants, including those from developing a geopolitical point of view, along with countries. Growing economic and social Switzerland (30%), Germany (31%), the diversity has often compounded metropoli- United States (34%) and France (36%). In tan segregation. Although middle class the Netherlands, about half the population areas predominate in the largest metropoli- lives in central city neighborhoods, but in tan regions of the developed world, it is usu- the other countries studied, the bulk of the ally possible to find both exclusive affluent population continues to reside in central localities or neighborhoods and concentra- towns rather than traditional suburbs. tions of poverty and social disadvantage. Overall levels of territorial segregation vary The number of communities with approxima- widely among metropolitan regions, but tely 100,000 inhabitants is a second widely range higher in the United States than in accepted measure of this kind of political- most of Western Europe or Japan. institutional fragmentation (e.g., Brunn and Ziegler 1980) in metropolitan areas. The In most southern cities, the incidence of higher this indicator is for a metropolitan poverty is determined primarily by the local area, the greater the fragmentation. In a labor market. The income, security, and majority of the countries in the International benefits linked to employment remain the Metropolitan Observatory (IMO) project, this primary means by which households can measure of institutional fragmentation is low, avoid impoverishment. Industrial firms are having a value lower than five. Such a low the major employers in the urban centers score invariably indicates that municipalities of the South, though in some places the in the region have been merged, as they service sector has been replacing them. were recently in Canada (1). Sweden and the Street trading and the informal job sector Netherlands (2), Poland and Israel (3), and have become a major source of employ- Norway (4), also merged their metropolitan ment for those not in the formal sector. The municipalities comparatively recently. In proportion of jobs in this sector varies Spain, the exurban parts of metropolitan between cities but often accounts for areas have only developed in recent years, upwards of 20% of those in employment. accounting for that country's low level of METROPOLITAN GOVERNANCE 264 As measured by institutional fragmentation (3). The highest Overall, the IMO data show geopolitical this index, France values appear in countries where pre-in- fragmentation to be highest in those devel- dustrial municipal boundaries largely survive, oped countries where metropolitanization appears as the such as France (32), the Czech Republic and has proceeded amid continued legacies of Switzerland (21), Germany (18), the United older town and village settlement and most territorially States (15) and Hungary (12). It may seem administration (France, Germany, Switzer- fragmented surprising that these values are much higher land, the eastern portions of the United in Hungary and in the Czech Republic, former States). Fragmentation is also progressing country in Europe communist countries, than in Poland (3) or in rapidly in a number of other countries where other post-communist countries such as Slo- metropolitanization is relatively new, such vak Republic. This higher level of fragmenta- as the Czech Republic, Hungary, Spain and tion is a result of planned programs for Israel. By contrast, far-reaching reforms municipal disaggregation carried out by the have succeeded spectacularly in reducing Czech and Hungarian national governments. fragmentation in Scandinavia, Canada, and the United Kingdom. A geopolitical fragmentation index deve- loped by Brunn and Zeigler (1980) com- Other than South Africa, which is included in bines the two previous indicators into a sin- the IMO project, no comparable data are as gle measurement. This enables a summary yet available to measure geopolitical frag- comparison among the IMO countries. mentation in the developing and transitional countries of the South. However, South As measured by this index, France appears Africa provides a dramatic example of gov- as the most territorially fragmented coun- ernmental restructuring in the South. Post- try in Europe with a value of 11. This indi- apartheid reforms in South Africa effectively cates considerably more fragmentation eliminated geopolitical fragmentation by than the average for the United States reconfiguring municipal boundaries to corre- (7), which is more or less the level for spond with the economic and social outline Switzerland. International comparison of of the major metropolitan areas. the Zeigler and Brunn scale shows that there is no uniform North American Similar moves toward metropolitan consolida- model: Canadian metropolitan areas are tion took place earlier in other developing institutionally very different from those in countries during the period when governmen- the United States, and recent consolida- tal consolidation was fashionable in Northern tion reforms have placed Canada closer to Europe. In 1973, the Brazilian military regime the Northern European model. Similarly, it created nine metropolitan regions that are still is not possible to put all countries in East- functioning today. In Republic of Korea, the ern Europe in the same bracket. While regime instituted metropolitan regional gov- they were all subject to waves of mergers ernments for Seoul and several other cities. during the communist period, the frag- Many Southern countries also established mentation of the post-communist Czech some form of metropolitan territorial authority Republic (3) presents a completely differ- for their capital city regions. ent profile from Hungary (1.7) or Poland (0.6). Because of a recent, less-pro- In the South, these consolidation efforts nounced metropolitanization process, have generally failed to eliminate the prob- Spain (0.5) appears to be closer to the lem of geopolitical fragmentation. There as in Netherlands (0.5), Sweden (0.3) and Nor- the North, the problem remains especially way (0.8) than to neighboring France. evident in the largest urban regions. Laqian, Germany (6) is highly fragmented, and in a recent survey of governance in Asian has higher levels in eastern metropolitan metropoles, calls political and administrative areas, as well as some western metropol- fragmentation "[t]he most serious problem itan areas, including Koblenz. that many of them face" (2007, p. 145). In METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 265 some former colonies, structures of colonial "global city regions" points instead to the ro- Since the 1970s, administration still define local district le of regional economic clusters in the high- however, much boundaries outside central cities. Elsewhere, technology and advanced service components as with the Indian panchayat or the Philip- of modern industrial economies (e.g., Scott ofthenew pine barangay, indigenous settlements shape 2001). In developed countries, a range of manufacturing municipal jurisdictions. Where metropolitan smaller and mid-size urban regions have governments are in place, spatial expansion also managed to stimulate growth by capacityinthe often continues beyond the formal adminis- attracting high technology, corporate branch developing world trative boundaries into surrounding localities. offices, and educational or administrative ser- Metropolitan governments now administer vices (Markusen, Lee and DiGiovanna 1999). has been built 50% of the metropolitan population in Mex- This new round of economic competitive- outside urban ico City, 71% in Sao Paulo, 45% in Seoul and ness has not pushed growth in just one 38% in Johannesburg. direction. Increasingly, metropolitan centers centers, usually in find that there is considerable commercial Even where the jurisdiction of metropolitan allure in a vibrant urban environment and surrounding towns governmental authority extends over the en- the cultural amenities found there (Glaeser, tire metropolitan area, other forms of frag- Kolko and Saiz 2000). Such new regional mentation can frustrate effective governance. economic dynamics further reinforce demands In Bangkok, Manila, and Mumbai, for in- for more regional collective action. stance, metropolitan authorities have se- cured extensive geopolitical jurisdiction, yet In the South, development has been compar- effectiveness is often limited by political and atively uneven. Despite greater pressures administrative interference. To some extent there to pursue economic prosperity, gover- local or high-level governments can formally nance of metropolitan regions in the South restrict the power of metropolitan institu- presents challenges that are similar to those tions. A further dilution of metropolitan intheNorth.Forthefirsthalfofthe20thCen- authority occurs where agencies or offices tury, cities in Asia and Latin America focused charged with different sectoral tasks, such as almost exclusively on industrial development roads, housing, and transit, resist directives andmodernization.InmuchofLatinAmerica, from the metropolitan government. as well as in the Asian countries of Thailand and Republic of Korea, cities absorbed much III.3. Economic Globalization of this industrialization and commanded cor- and Competitiveness respondingly large proportions of national resources. Aggravated by conditions of Increasingly, in both the North and the South, authoritarian rule in many of these countries, metropolitan regions have been recognized urban primacy had the demonstrated effect as key nodes for national economic strate- of reducing the potential for overall national gies. They are also regarded as vital hubs for development (Ades and Glaeser 1994). mobilization for rapid economic development. Alongside the globalization of trade and pro- Since the 1970s, however, much of the new duction networks, the shift to service and manufacturing capacity in the developing high-technology business has reinforced this world has been built outside urban centers, transformation of metropolitan commerce. usually in surrounding towns. New indus- trial parks and high-technology centers Most literature on "global cities" initially cen- have also been situated on the periphery of tered on the largest cities of the North, and major urban centers, such as Campinas in sought to analyze urban regions according the Sao Paulo region (Markusen, Lee and to global hierarchies based on their position DiGiovanna) and the HITEC Center outside in international finance, corporate governance, of Hyderabad (Kennedy 2007). In the face elite travel, and communication (e.g., of the underdevelopment and declining for- Sassen 1991; Taylor 2003). Other work on tunes of the countryside, new centers of METROPOLITAN GOVERNANCE 266 Services, high development in the South continue to rely bilities have increased. Conflicts now focus technology on the infrastructure, capital, and other routinely on the financing of collective goods advantages conferred by proximity to the and services, from public transportation to activities and largest urban concentrations. This stands cultural facilities to sewage treatment. Even in contrast with the North where more dis- within a consolidated jurisdiction, territorial commercial parate, smaller urban regions, including polarization between neighborhoods or development have Austin, Montpellier, Raleigh-Durham and other parts of cities can generate growing Toulouse, have seen significant growth in conflicts. In the wake of decentralization and increasingly high technology and service development democratization in Southern cities, metro- replaced (Sellers 2002). politan leaders in such diverse settings as Brazil, South Africa and India have all had to traditional A corresponding consequence of global eco- address tensions of this kind. manufacturing nomic shifts has been a general increase in inequality. According to Sassen (1991), the The socio-economic dimension of conflict can astheobjects increase in disparities between the elite in transcendterritorialbases.A classic example ofmetropolitan service businesses and the underpaid, im- is the perennial clash between the interests migrant work force employed by those busi- of capital and those of the workforce and economic nesses,resultsinanincreaseinsocialandspa- local residents. Conflicts of this type hark recruitment tial polarization. Regional strategies associated back to the mercantile origins of cities, yet with globalization are often geared more they still drive debates over metropolitan toward attracting economic development than governance institutions. Proponents of me- to addressing these new disparities. In more tropolitan governance, regardless of whe- dynamic regions, public expenditure tends to ther they are themselves local chambers of support physical infrastructure that facilitates commerce or business representatives, of- growth and new economic activities. Especially ten portray economic development as a pri- when accompanied by the fragmentation of mary objective. But in the South as well as many metropolitan regions, such strategies the North, the arguments about this objec- can compound disparities in the provision of tive have shifted. Services, high technol- local public services. ogy activities and commercial develop- ment have increasingly replaced III.4. Socio-Political Conflicts traditionalmanufacturingastheobjectsofme- tropolitan economic recruitment. In the North, The emergence of metropolitan regions local businesses now mobilize regularly has some of its most far-reaching implica- alongside governments around local initia- tions for territorial conflicts. Especially in tives to bring these activities (Sellers 2002; much of the North, as the monopolistic Jouve and Lefèvre 2002). In much of the position of central cities has declined, North partisans of growth limits or growth increasingly fierce economic and political management also regularly contest the competition pits urban centers against sur- untrammeled pursuit of regional growth rounding municipalities that refuse to be (Clark and Goetz 1994). In the South, relegated to suburbs or satellites. Experi- environmental groups usually exercise less ments in inter-local redistribution of influence, but are becoming more active. resources in Europe and North America have largely arisen out of intensified argu- Ethnicity and religion present another ments over fiscal exploitation between ex- source of conflict that can cross territorial urban communities and cities. boundaries in metropolitan regions. In both the North and South, ethnic, racial and reli- As the localities within metropolitan regions gious divisions often reinforce existing bar- have coalesced into distinctive demographic riers between the haves and have-nots. and income clusters, tensions over the terri- Where minorities, especially immigrants, torial distribution of resources and responsi- move into areas dominated by residents METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 267 with a different ethnicity or race, the inte- institutional designs for metropolitan gover- In many countries gration of the newcomers can give rise to nance. At the beginning of the 1940s, one of the number conflicts with a national majority, as well as the leading representatives of the Chicago between the new minority and the resident School of urban studies, Louis Wirth (1942), ofparties majority. Immigration and citizenship called for formal institutional consolidation: and political groups issues have thus provoked both populist "We live in an era which dissolves bound- backlashes and resurgences in minority- aries, but the inertia of antiquarian lawyers representedin rights movements in the cities of Europe, and lawmakers, the predatory interests of local assemblies Japan and the United States. In the grow- local politicians, real estate men, and indus- ing number of large cities with pervasive trialists, the parochialism of suburbanites, has grown ethnic or racial divisions, such as Mumbai and the myopic vision of planners have pre- substantially or Los Angeles, group identity regularly vented us from a full recognition of the furnishes flashpoints for social tensions, inescapable need for a new planning unit in political clashes and inter-group violence. the metropolitan region." A fourth element of the new urban strife is Up to the 1970s academic opinion through- partisan conflict over ideologies, programs out the global North reflected this view. The and strategies. The influence of distinct par- wave of reorganization of local government ties and coalitions differs considerably, in the 1960s and 1970s in Europe, North depending on location and context. Reflect- America and parts of the South drew on ing, at least in part, trends in other dimen- these critiques. Two arguments were essen- sions of conflict, political parties have also tial to the case against fragmentation. First, developed new forms. In many countries the essential tasks and responsibilities of the number of parties and political groups governance ­ from infrastructure to social represented in local assemblies has grown equity ­ spilled over fragmented jurisdictional substantially. In Europe new ecological and boundaries in ways that demanded consoli- populist parties have appeared. In the dated institutions. The second, opposing, South decentralization and the establish- concept posits that larger governmental ment of local democracy has helped foster units could take advantage of economies of new interest groups in the local partisan scale, providing public services at lower landscape. Partisan organizations tradition- cost than smaller governments. ally have exerted only limited control over local politics in many Southern cities. Now Applied to vastly different regional, national upstart religious and ethnic parties compete and socio-political contexts, a decades-old openly and with some success with the argument has coalesced around two gen- established parties. As in Europe, these new eral strategies: supra-community reforma- groups threaten traditional single ­ or two- tion and territorial polycentrism. party domination, and further complicate the already fragmented local party system. IV.1. Supra-Community Reform To those in favor of creating overarching IV. Institutional Alternatives for metropolitan governments to replace a Governance within Metropolitan multitude of existing local authorities, a Areas salient failing of the multi-government model is its weak performance as a demo- In early 20th Century North America, wide- cratic institution. This is evidenced by a spread suburbanization created some of the decline in local political and electoral par- most extensive and dispersed urban regions ticipation in many countries. In addition, ever seen. Under conditions of high geopo- many local governments are perceived as litical fragmentation, a debate emerged that inefficient and disconnected from the to this day continues to shape choices about expectations of their citizens. METROPOLITAN GOVERNANCE 268 There is The weakness of a multitude of local govern- movement emerged to defend decentralized a perceptible lack ments preoccupied with only local concerns is metropolitan arrangements. To counter the a perceived unwillingness to act on issues arguments of reformers, those against the of collective will that affect the entire region. This was the ar- formation of metropolitan governments criti- gument advanced, for example, by the Que- cizedtheirredtape,theirhighoperatingcosts among those who bec government in their White Book on mu- and their remoteness from their citizens. might effect broad nicipal reorganization (2000:20): "The limited size of the municipalities is sometimes The supporters of the political-economic changes presented as an advantage in terms of the approach known as Public Choice have pro- in metropolitan exercising of democracy because it allows for vided the main inspiration for arguments in an administration that is more attuned to re- favor of small local units as the main units boundaries sidents' needs. However, insofar as the frag- for governance in metropolitan areas (Os- mentation of the municipalities limits their trom, Bish and Ostrom 1988). This approach ability to deal with the often important issues analogizes local governments competing for that transcend their territories, e.g. land use residents to privately owned companies planning, the environment, public transporta- competing for the production or sale of goods. tion, and economic development, there is in- Proponents argue that it is more efficient stead a risk that residents will be less in- and democratic for the localities within a terested in participating in municipal life." metropolitan area to compete among them- selves for the production or sale of public The significance of these arguments needs to services than to leave those services to one be understood in light of the highly decentral- monolithic government entity. They argue ized states where they were put forth. In further that the coexistence of different gov- North America, the fragmentation of local ernment units with different combinations of authorities, including municipalities and dis- services and taxes offers inhabitants a wider tricts established for education and other choice of residential areas. Residents can services, contributes to great disparities in thus select the community within the metro- the services different communities receive. In politan area that best corresponds to the some cases these differences are caused by level of public service they seek. Resources variations in local skills and in the profession- needed by the separate metropolitan towns alism of municipal bureaucracies. In the can be shared through agreements about United States and Canada, those in favor of specific functional sectors, such as trans- integrated forms of metropolitan government portation, education and health (Marks and have generally stressed the need to reduce Hooghe 2003). intra-metropolitan area socio-economic dis- parities in such services as education and Beyond such operational concerns, there is security (Dreier, Mollenkopf and Swanstrom a perceptible lack of collective will among 2004). Reform was also held out as a better those who might effect broad changes in way to address problems that require coordi- metropolitan boundaries. Middle classes in nated collective action throughout a metro- many countries have shown little desire to politan area, in such sectors as water supply, contribute financially to the reduction of waste management and air pollution. intra-metropolitan wealth disparities, and to the quest for fiscal equity. There has IV.2. Territorial Polycentrism thus been only limited middle-class sup- port for a key principle underlying the push It was ultimately in more centralized North- for metropolitan integration. ern European countries, for example the United Kingdom, where successive waves of IV.3. The "New Regionalism" communal consolidation came closest to real- izing the goals of supra-community reform Given the imposing realities of life in large nationwid.. In the United States, a counter- metropolitan areas, a practical compromise METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 269 may be found in a flexible solution with a traditional forms of metropolitan govern- Governance is no variable scale of inter-municipal coopera- ment seem increasingly inadequate. longer confined to tion. In this case results can be manifested in different ways. The advantages of such It is therefore not appropriate to speak of thebuilt-upareas quasi-formal cooperation have been simple replacement or of the substitution of distinct urban emphasized in many empirical studies. of one model by another over time. Rather it is more useful to envision increased dif- conurbations;it By the end of the 1970s, disenchantment ferentiation among a variety of mixed sys- now extends to with conurbation institutions became tems of government. This movement can apparent in many countries. In Great be observed in most countries, both in the vast multi-polar Britain the suppression of urban counties North and in the South. urban regions that and the Greater London Council took place in 1986; the same year saw the dissolution How can these new forms of metropolitan go- continue to expand in the Netherlands of the Rotterdam and vernance be characterized? Analysis of recent Eindhoven conurbation bodies. At about institutional experience reveals five particu- and change the same time, Australian authorities larly significant aspects: acknowledged the failure of repeated fed- eral and state attempts to consolidate local · Pragmatic responsiveness in execution. authorities, and in Spain metropolitan gov- Stategovernmentstendnottoimposetheir ernments in Valencia and Barcelona were ideas any more; instead they take great dismantled. The French called an early halt care to consult, listen, put into perspective, to an urban communities' institutionaliza- harmonize and reconcile. Rather than pro- tion process, the Italian effort to create pose a single institutional model for all metropolitan areas failed to get off the urban areas, they work carefully on a ground and in Germany consolidation "made-to-measure" solution. Decisions to experiments such as the Umland Verband undertake reform respond to specific cha- Frankfurt and the Kommunalverband llenges related to the management of ur- Ruhrgebiet proved disappointing. bangrowth(Downs1994). However, the concept of metropolitan area This view makes it easier to understand government itself has substantially changed the changes in governance of the Tokyo in the past 20 years. Most of the models region. The Tokyo Metropolitan Govern- envisaged or experimented with in the 1980s ment (TMG), became one of many players are now seen from the perspective of gover- ­ prefectures, regional ministerial offices, nance, rather than government. Moreover, Japan Railway, private companies ­ in- governance is no longer confined to the built- volved in regional governance. In a similar up areas of distinct urban conurbations; it fashion, the recently created Greater Lon- now extends to vast multi-polar urban don Assembly appears to be a relatively regions that continue to expand and change. superficial mechanism. It cannot exercise anyrealinfluenceexceptinstrictcollabora- This new trend toward a more flexible, tion with the boroughs, privately owned polycentric form of governance, described public service companies (special purpose in North America as new regionalism, is agencies), two regional development firstly associated with the global decentral- agencies, and several central government ization process. This approach seeks to departments. Canada, throughout the strengthen local authorities at the expense second half of the 20th Century a leader in of large, supra-municipal organizations, integration of metropolitan governments, especially in areas of the world that are on has now turned toward a polycentric neo- the path to democracy. At the same time, regionalism. This shift comes in the wake the form, pace and scale of contemporary of spectacular de-fusion measures fol- metropolitan transformations has made lowing referenda among municipalities METROPOLITAN GOVERNANCE 270 Decentralization and Local Democracy in the World grouped within metropolitan areas. The than simply to supply services directly developmentof"lighter"governancestruc- (Harloe2003). tures built around regional districts and metropolitanmunicipalitieshasfollowed. · Theprimacyofmissionovermanagement. The metropolitan administration is com- · The adaptation of existing territorial units mitted above all to planning, coordinating and governments above the municipal le- andintegratingpoliciessetbymetropolitan vel to manage emerging challenges of area local authorities. True management metropolitan regions. For large urban tasks remain limited. As a consequence, regions, such as Tokyo, Paris and Sao Pau- expert and scientific analysis of the metro- lo, a regional or federal unit of government politan problem is more nuanced and plu- provides administration at a scale beyond ralistic than it was 20 years ago. Rather the local government itself. Similarly, in than agencies of strategic direction, the the United States county governments, newstructuresofmetropolitangovernance which are a higher level than local munici- are necessarily lighter: The Greater London palities, often provide a more encompas- Authorityhaslittlemorethan600employe- sing administrative framework for es. carrying out planning or providing social Metropolitan services across municipal boundaries. · Close association with the private sector. governments American advocates of metropolitan go- At all stages in the process of institutional can usefully be vernance increasingly look to coalitions maturity, the strong influence of private among representatives of cities and su- sector leaders and organizations can be classified by the burbs in the legislative and policymaking seen. In Europe as well as the United arenas of state and federal governments States, chambers of commerce and asso- amount of territory as a source of metropolitan policy (Dreier, ciations of enterprises are particularly where they have Mollenkopf and Swanstrom 2004). prevalent. In some countries, the role of the private sector is determined by legis- jurisdiction, · Strengthening democratic legitimacy. For lation. their institutional the supporters of new forms of metropoli- tan governance, direct popular election of depth, and their legislators and government executives has V. Panorama of Existing Metropolitan democratic a double purpose: enhancing local auto- Governance Arrangements nomy and strengthening the link between intensity citizens and their political representatives Worldwide there is great variety in metro- (responsiveness). The direct election of the politan governance. As illustrated in Table 1, leadershipforMetroTorontobeganin1988. metropolitan governments can usefully be In Stuttgart, when the political parties offe- classified by the amount of territory where red lists of candidates for election to the they have jurisdiction, their institutional Stuttgart Regional Community (Verband depth, and their democratic intensity. The Region Stuttgart) founded in 1994, party position of metropolitan regional govern- leaders took care to include the smallest ments in the overall governmental hierar- possible number of local representatives. chy, including national and other systems, This tactic limited political ties to parties in also influences the effectiveness and signifi- existing local governments, further empo- cance of metropolitan governance. Addition- wering the regional assembly. Since 2000, ally, the specific governmental functions as- the Greater London Assembly and the sumed by the institutions of metropolitan mayor are elected directly by the people. governance reveal global similarities and Unlike the former Greater London Council, contrasts, as do any trans-national arrange- theGLAhasadoptedastrategytoencoura- ments that address the challenges of de ge competition and social cohesion rather facto international metropolitan governance. METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 271 Table 1 Dimensions of Governance Institutions in Metropolitan Areas Lower Moderate Higher INTERNAL Spatial coverage Fraction of the metropolitan area Majority of the metropolitan area The entire metropolitan area Institutional thickness Inter-community co-operation Authority for metropolitan development or specific sector Metropolitan town Democratic intensity Local democracy only Multi-level democracy Compound metropolitan democracy EXTERNAL Centrality to higher level policymaking Intra-metropolitan divisions Regional capital Prime urban region Inter-metropolitan divisions National alliance of urban regions National capital Limited representation Sector-specific integration for metropolitan interests V.1. Spatial Coverage Many metropolitan governance arrange- ments are confined to limited, often socially Existing institutions may cover all of a met- and spatially distinct portions of metropoli- ropolitan territory, or only part of it. Conse- tan areas. In Argentina, the Northern Met- quently, their ability to regulate, manage ropolitan Region, a consortium created in and affect residents necessarily varies. 2000, encompasses just a portion of the Especially under conditions of rapid growth, mainly affluent municipalities in the Buenos the fluid functional and demographic Aires metropolitan area (San Fernando, Vi- boundaries of metropolitan regions make cente Lopez, San Isidro, Tigre). In the same spatial coverage a constant challenge. manner, the minimal coordination of public policy among 39 different towns in the Sao Most metropolitan governments have to Paulo metropolitan area appears to affect make adjustments to accommodate just seven of them. All seven, Diadema, changesintheirofficialterritory.Insomecases, Sao Caetano do Sul, Sao Bernardo do the metropolitan government at its incep- Campo, Santo Andre, Maua, Ribeirao Pires tion did not encompass its entire modern and Rio Grande da Serra, operate within the region; others have seen their region grown Camara Regional do Grande APC. It is well beyond their official boundaries. For symptomatic that the central town, Sao example, Metro Toronto was created in Paulo, is not a member of this consortium. 1953, but by 1991 still covered only 54% of the Toronto metropolitan area. Similarly, V.2. Institutional Thickness the Greater Bombay Municipal Corporation (GBMC) covers only 67% of the population The governance of metropolitan areas can be in the Mumbai metropolitan region, even more or less institutionally concentrated and though it serves 12 million of the region's integrated, both territorially and functionally. 18 million inhabitants. More recently, the reform that created metropolitan govern- a)Newtownormetropolitantown ments for South African urban regions suc- It is relatively rare for a single authority to ceeded in bringing only 38% of the total exercise general and multifunctional population in the Johannesburg metropoli- authority over an entire metropolitan terri- tan region under the single central metro- tory. It occurs where a merger of all com- politan government there. ponent communities has taken place. METROPOLITAN GOVERNANCE 272 Decentralization and Local Democracy in the World When this happens, the metropolitan area is ANC, which saw in metropolitan govern- likely to be structured around the metropol- ment the most effective vehicle for territo- itan town that provides most services. The rial reform and for reduction of socio-eco- Bangkok Metropolitan Administration (BMA), nomic inequities. In December 1998, the for example, was created by merging Local Government Municipal Structures Act Bangkok and Thonburi. Similar absorption of officially recognized the formation of metro- at least some functions and responsibilities politan towns, whose boundaries would be of lesser towns has occurred in Seoul, Kuala defined by a commission called the Municipal Lumpur, Surabaya and Jakarta. The Seoul Demarcation Board before the 2000 local Metropolitan Government is run by a mayor elections.Therearenowsixsuchtowns:Cape and an assembly that is more or less elected Town, Ethekwini, Johannesburg, Ekurhuleni, directly by the people, and encompasses Tshwane, and Nelson Mandela (Cameron and 25districtscalledGu.TheChinesegovernment Alvarez 2005). It is still too early to draw firm created metropolitan towns directed by conclusions from this unique effort. So far, powerful mayors who are appointed by the however, the creation of metropolitan towns The metropolitan state in Beijing, Shanghai, Guangzhou, appears to have improved the lives of resi- Chongqing and Tianjin. On the infra-metro- dents in some places but had mixed or even level of governance politan level, districts still exist, but with re- disappointing results in others. can take any one duced authority and budgets. This some- times leads to friction between the b) Co-existence of local governments of several forms: metropolitan level and the affected areas. with metropolitan structures a metropolitan This formula combines proximity between A series of mergers between communities local authorities and their citizens with trans- development belonging to two-level metropolitan sys- fers of responsibility for metropolitan issues council, tems has taken place at the instigation of to a specific supra-community entity. In prin- Canadian provinces. In 1970, the New ciple, the federal logic underlying such an a metropolitan Democratic Party, having a majority in the arrangement precludes any hierarchical or development Manitoba provincial parliament, decided to subordinate relationship between the two combine the Corporation of Greater Win- territorial levels. The Canadian provinces of authority, nipeg and its districts into a single town, Ontario, Manitoba, Quebec and British or a fully Winnipeg. The hope was that the merger Columbia created such structures for all of would alleviate socio-economic and finan- their metropolitan areas in the 1950s and empowered cial difficulties in the central town by 1960s; for a long time Metro Toronto (1953- including its wealthier suburbs in the 1997) was the government prototype. Simi- metropolitan region's resource pool. The Ontario govern- lar metropolitan governance structures also government ment in 1998 employed a similar merger play a role in Metro Manila, Sao Paulo, Lima, strategy to forge the new Town of Toronto. Rio de Janeiro, Bombay and Calcutta. Two years after that, the province of Que- bec created the new, enlarged municipal The metropolitan level of governance can areas of Montreal and Quebec. take any one of several forms: a metropolitan development council, a metropolitan devel- One of the world's most striking recent opment authority, or a fully empowered met- experiments with metropolitan governance ropolitan government. is taking place in South Africa. By its nature, the old apartheid regime with its The metropolitan development council institutionalized segregation prevented any guarantees the retention of power by com- type of metropolitan organization. The abo- ponent local governments. Members of the lition of apartheid in the 1990s led in a very local government designate their mayor, or short time to the appearance of metropoli- some other local official, as their council tan towns. Pressure for this change came member. These council members in turn primarily from the dominant party, the select a council executive from among METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 273 their number. Advisory councils with this Tokyo's TMG was created in 1943 by a type of structure can be found in most merger of the City of Tokyo and the Prefec- metropolitan areas in the United States, ture of Tokyo. Today, it is a metropolitan For example, the Metropolitan Washington prefecture consisting not only of the central Council of Governments (WASHCOG), was town and its districts, but also the Tama created in 1957 for the Washington metro- area, which includes 39 municipalities, 26 politan area. The same structure is also towns, 5 localities and 8 villages. It found in El Salvador in the Council of May- appears that the TMG gives priority to ors for the Metropolitan Area of San Sal- running the services and development of vador (COAMSS: Consejo de Alcaldes del 23 districts of the City of Tokyo guided by a Área Metropolitana de San Salvador). system of financial equalization, while run- ning the western part of its territory (Tama) The Metro Manila Development Authority in a more detached manner (Vogel 2001). (MMDA) was created by Filipino legislation in 1995. The council is made up of state The degree of institutional thickness de- representatives and 17 mayors (seven towns pends on a metropolitan structure's fi- with extended powers, and 10 municipali- nancial autonomy. The Chinese central gov- ties). It replaced the Manila Metropolitan ernment has given metropolitan areas Authority, which in 1990 had in turn replaced significant scope in taxation and the man- the Metropolitan Manila Commission, which agement of their own resources, including was set up in 1975 with relatively impor- buying and selling of land, tariffs and The degree tant powers. The MMDA is not a territorial license fees and securing loans in China and collective. It is a specific public body placed abroad. In France, the communautés ur- of institutional under the direct control of the President of bains are responsible for large budgets that thickness the Philippines. The MMDA is responsible correspond to their expanded areas of for planning, monitoring and co-ordination authority. The Communauté Urbaine de depends on a tasks, but its budgetary resources remain Bordeaux (CUB) budget is twice the size of metropolitan limited. It is considered not well suited to the budget of the City of Bordeaux, in part regulating the policies of its component because the CUB carries both compulsory structure's parts because of the weakness of its inte- and optional missions associated with the financial autonomy gration instruments. The MMDA appears to production of large facilities, the modern- be caught between the power of the state ization of urban services and the develop- authorities and the desire of the 17 munic- ment of the local economy. ipal authorities to escape from any direc- tion or restriction imposed by higher c)Intercommunityco-operation authorities. (Laquian 2001). Governing metropolitan areas can also be carried out by means of agreements between Compared with a metropolitan develop- and among municipalities. Legislation can ment council, a metropolitan development prescribe or simplify such arrangements in authority concentrates more on techno- designated sectors or services. An intermu- cratic functions than on political methods nicipal agreement, which is the most popular of governance. This model has been arrangement worldwide, can operate even in adopted by many Indian metropolitan the absence of a specific metropolitan insti- areas, including New Delhi, Bombay, tution. Such cooperative agreements have Karachi and Colombo. been established in quasi-official form within the metropolitan areas of Sydney (Kübler The model of a metropolitan government 2005), Australia, and also in Lima-Callao, superimposed on local authorities provides Santiago du Chile, and Santa Fe de Bogota in more functional integration, and its leadership South America. They also foster mutual sup- is often elected directly by the people. This port between large Russian towns and their is the case in Tokyo and in Toronto. surrounding oblasts (regions) and among METROPOLITAN GOVERNANCE 274 Decentralization and Local Democracy in the World Flexible structures many municipalities and counties in United nation: in some cities there, none at all. to coordinate local States metropolitan regions. Lack of sufficient local autonomy or capa- bility often contributes to this problem. In participation Under these types of agreements, territorial Nigeria, Ethiopia and Tanzania, the urban fragmentation persists, but specific sector- authorities have rarely experienced a level around targeted based integration overcomes it in the per- of autonomy that would allow them to initiatives are formance of specific, sometimes narrowly manage their own policies, much less forge defined sectors, such as water and sanitation, cooperative agreements with neighboring common, and have electricity, transportation and waste pro- local governments. In Nigeria, disputes become more so cessing. The resulting arrangements are over the proper application of existing gov- expected to realize economies of scale for the ernmental and professional skills have over the past few management of capital-intensive services. impeded intra-city cooperation. It was only in years 2003 that the decentralization begun by The two main agencies of Metro Manila are Ethiopian state authorities gave Addis- the Metropolitan Waterworks and Sewerage Ababa a new charter with the express aim System, and the Light-Rail Transit Authority. of ending a century of centralized develop- The Karachi Metropolitan Corporation special- ment. In Tanzania, decentralization in the izes in economic development projects in the 1970s was simply a de-concentration exer- largest of Pakistan's cities, the Karachi Devel- cise. Dar el-Salaam's new municipal structure, opment Authority manages property and operational since February, 2000, followed infrastructure and the Karachi Water Supply a long period of technocratic and central- and Sewerage Boards preside over their ized management of the town. In all three of respective tasks. Another example of inter- these African metropolitan towns, territorial community cooperation is seen in the Dhaka parceling through the creation of new metropolitan area of Bangladesh. There spe- administrative units contrasts with the uni- cialized agencies operate in parallel both in fication process seen in South Africa. the City of Dhaka, and with a set of munici- palities (pourashavas) and 42 state services. Intervention by higher level governments Among these, the most important are RAJUK can also supplant metropolitan cooperation. (Capital Development Authority), the Dhaka In Israel, for instance, despite the high pro- City Corporation and the partly state-control- portion of its population living in the four led Dhaka Water and Sewerage Authority. metropolitan areas of Tel Aviv, Jerusalem, Similar arrangements may be found in other Haifa and Beer Sheva, there are very few major metropolitan regions from Los Angeles metropolitan governance mechanisms. In to Sao Paulo (see Appendix). the Tel-Aviv metropolitan area most inter- community efforts are organizationally weak. Flexible structures to coordinate local par- At least in part, this is because central ticipation around targeted initiatives are authorities maintain strict control over ter- common, and have become more so over ritorial development, transport and regional the past few years. The State of Sao Paulo, infrastructures (Razin and Hazan 2005). for instance, has initiated a number of these arrangements since the 1990s. In conjunc- V.3. Democratic Depth tion with an NGO, the Metropolitan Forum for Public Safety created the institute "Sao The citizens' role in the appointment and Paulo Contra a Violência." The state also control of metropolitan authorities varies established a system of governance for widely. Although electoral institutions alone river watersheds, incorporating a variety of are rarely sufficient to ensure responsive- local stakeholders (Abers and Keck 2006). ness or democracy, recent local electoral reforms in many countries have been Especially in the South, many metropolitan intended to extend opportunities for elec- areas have weak intra-metropolitan coordi- toral participation. The growing size, com- METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 275 plexity and territorial connectedness of itan towns are run either by mayors (Johan- Electoral metropolitan regions increasingly poses nesburg, Ekurhuleni, Tshwane, and Nelson institutions alone what Devas (2005) calls a tradeoff between Mandela) or by executive colleges (Cape "scale" and "voice" in governance. The Town and Ethekwini). Although the latter are arerarely larger the scale of governance, the more not directly elected by the people, they are sufficient to ensure difficult it is to provide effectively for the appointed by the parties according to their participation of local units, neighborhoods, electoral score. In some cases, only some of responsivenessor civil societies or individual citizens. the representatives are elected by the peo- democracy, recent ple. The council of Bombay's GBMC, for Indeed, integrated metropolitan structures instance, is elected, but its executive is local electoral have frequently been imposed by authori- appointed by the state of Maharashtra. reforms in many tarian central governments. Alongside tech- nocratic efficiency in urban management, Democracy can be organized on an infra-me- countries have non-democratic governments have used tropolitan scale. Sub-municipal elected gov- metropolitan administration to control polit- ernments play an especially important role been intended ically "sensitive" urban regions; that is, whenthemunicipalgovernmentislarge.Thus, to extend those suspected of having potential to South African legislation allows provincial breed opposition. For example, in 1973 it authorities to create either sub-councils or opportunities was the Brazilian military regime that cre- ward committees. The sub-councils, made up for electoral ated the nine metropolitan regions of of municipal councilors and councilors from Belém, Fortaleza, Recife, Salvador, Belo adjacentwards,performaconsultativerolefor participation Horizonte, Rio de Janeiro, Sao Paulo, the municipal council, which can delegate spe- Curitiba and Porto Alegre. Though initially cific powers to them. Ward committees, made supported and tightly controlled by the gov- up of the ward municipal councilor and repre- ernment, only vestiges of this system sentatives of the people, function as instru- remained at the start of the 1990s. By then, ments of participative democracy. Sixteen, a new democratization and decentralization then 20 sub-councils have been created in process was well underway. Similarly, the Cape Town. Ward committees have been set Metropolitan Manila Commission was cre- up in Johannesburg, Ekurhuleni, Tshwane and ated by the Marcos dictatorship in 1975, its Nelson Mandela. As in many such instances of leadership entrusted to Imelda Marcos. sub-municipal participation, municipal authori- ties have generally been hesitant to transfer Association with authoritarian regimes may power to these bodies. Initial assessments of explain why metropolitan governance has to a their operation show only modest participation certain extent been neglected in some coun- by local people (Cameron 2005). tries. In metropolitan governance systems that are based on the functions of specialized agen- In the case of the Tokyo TMG, arrange- cies,managementismainlycarriedoutbytech- ments for sub-metropolitan democracy nicians or bureaucrats. This necessarily reduces have recently provided greater democratic democratic control, and with it, legitimacy. depth. The mayors of the TMG districts Appointed by the President of the Philippines, have since 1974 been elected directly by theMMDAexecutiveisoftenpoliticallyimpotent the people. Since then, the districts have in the presence of the 17 directly elected may- been transformed from administrative orsofthetownsinthemetropolitanarea.These entities into special urban governments mayors provide financial contributions to the that carry out a portion of metropolitan metropolitan authority's budget. government services. A reform to devolve financial functions and skills to the districts Direct election of a metropolitan executive, was adopted in 1998 and took effect in as in Tokyo, Bangkok and Jakarta Raya, can 2000. The metropolitan authority remains enhance the legitimacy of metropolitan responsible for fire-fighting services as political institutions. South African metropol- well as water and sanitation. METROPOLITAN GOVERNANCE 276 Decentralization and Local Democracy in the World The depth of democracy refers to an aspira- sometimes created metropolitan regions tion that may never be entirely met. with a similar kind of primacy. In the Nonetheless, governance structures that Netherlands, for instance, the national come closest are those that go beyond economy revolves around the Randstad multi-level participation procedures and region that encompasses Amsterdam, Rot- provide real empowerment to make partici- terdam and the Hague. Even with a smaller pation meaningful at each level, from proportion of the national population, status neighborhoods to metropolitan councils. as a national capital can enhance the posi- Mechanisms that allow public participation tion of an urban region in the national econ- in routine governmental planning and budg- omy and in the shaping of national policy. eting can also deepen democracy. Since the emergence of metropolitan areas as a wide- In the South, the political dominance of major spread form of settlement, democratic the- cities in the middle of the 20th Century pro- orists have advocated compound demo- voked criticism that "urban bias" in policy- cratic forms of this nature (Dahl 1969). making had rewarded the urban elite at the expenseofcitizenslivinginsmallersettlements V.4. Relations with Higher-Level and in rural areas (Lipton 1977; Bates 1983). Since Governments Although cities, especially the largest, remain the emergence more prosperous than rural areas, recent The politics of metropolitan governance plays analyses have rejected such a broad conclu- of metropolitan out at higher levels of government, as well as sion. The increasing prosperity of cities small areas as within metropolitan regions themselves. From and large, the growth of poverty within cities, the perspective of leaders in metropolitan the democratization of national and local gov- a widespread form regions, effective governance often depends ernments, and the growing inter-dependency of settlement, upon bringing wider regional and national of city and countryside have fundamentally organizations and resources to bear. As urban altered underlying assumptions of that early democratic regions have become increasingly extended analysis(CorbridgeandJones2005).Moreover, theorists have and connections with the hinterlands have accumulating evidence shows that policy inter- grown, a better understanding is needed of vention can alter economic and social dispari- advocated the changing dynamics of intergovernmental ties between cities, as well as between cities compound relations between large cities and other sur- and the countryside (Overman and Venables rounding regions. 2005). National development in much of the democratic forms South now hinges on the exploitation of joint It can not be surprising that relations bet- advantages in cities, in the countryside and in of this nature ween metropolitan regions and higher lev- the rapidly growing zones in between. els of government vary widely. At one end of the spectrum are urban regions that have By comparison with other metropolitan re- secured a central position in the national gions, those with a favored position in political process. Such cities contain the national politics can benefit from advantages bulk of a nation's urban population, eco- in policymaking as well as in economic and nomic activity and cultural production. The cultural life. Paris, for instance, has been a re- metropolitan region of Seoul, for instance, peated site of major planning initiatives since contains 47% of the Republic of Korean the 19th Century. Similar initiatives in many population; metropolitan Lima contains smaller French cities began only in the 1970s. 32% of the population of Peru; metropolitan Latin American capital cities such as Bogota Buenos Aires has 32% of the Argentine and Santiago, as well as Bangkok, Manila and population. The demographic weight of Seoul in Asia, have been leaders in efforts to such cities often goes along with economic, build metropolitan governmental institutions. political and cultural centrality. In the smaller countries of the North, the growth However, some metropolitan regions, espe- of cities into inter-connected regions has cially in the largest nations, lack a notable METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 277 degree of socio-economic and political cen- same time, political and economic diver- trality. Under these conditions, metropolitan gences between metropolitan regions can regions can still find a voice at higher levels frustrate alliances in pursuit of common of government, and secure crucial support metropolitan interests. Intra-metropolitan for governance at the metropolitan level. In and inter-metropolitan political divisions are federal countries, metropolitan dominance now a recurrent feature of governance in within one of the federal states can secure the United States, and recently have begun similar resources. The Sao Paulo region in to emerge in such countries as Canada, Brazil, for instance, dominates the larger France, Switzerland and the United King- state of Sao Paulo; the Mumbai region is the dom (Hoffmann-Martinot and Sellers 2005). metropole for the Maharashtra state in India. Officials and activists from the Sao Paulo V.5. Sectoral Diversity and Limited region helped secure state-level legislation Convergence for water basin governance that created new possibilities at the metropolitan level (Abers As Hooghe and Marks (2003) have observed, and Keck 2006). Similarly, public companies governance arrangements for local cooper- and officials from Maharashtra state have ation in specific policy sectors ­roads, The increasingly played an important role in the development education, and pollution regulation ­ dispersed, plans of localities in metropolitan Mumbai. departs fromthetraditionalhierarchicalmodel of relations between higher-level and local go- fragmented and In specific sectors of policy-making, state vernments. By and large, such arrangements divided nature of ministries or other specific organizations for governing metropolitan regions reflect a representing higher-level governments global convergence around this more sec- metropolitan may contribute to metropolitan governance tor-specific, flexible approach, which is con- regions in many in ways that need not implicate those gov- sistentwiththe"newregionalism."Toadegree ernments as a whole. National and state not seen in the earlier U.S. debates over poly- developed environmental agencies, for instance, often centric and supra-communal arrangements, countries poses play active roles in antipollution initiatives. higher-level governments have played deci- Organizations such as the Metropolitan sive roles in many sectors. But the main new problems Region Development Authorities in Karachi international commonalities in orga- for effective and Mumbai can mobilize higher-level gov- nizational practices correspond to differ- ernment resources and authority on behalf ences between distinct sectoral domains. political and of local development. (See Annex 1.) A look at the main organizations involved intergovernmental At the national level, disparate metropolitan in metropolitan governance in six major representation regionscanformalliancestorepresentcollec- metropolitan regions provides illustrative tive interests. Politically influential organi- examples of several distinctive patterns. zations of urban representatives, such as the (See Appendix.) The two examples from German Staedtetag or the Nordic local go- the developed world present both central- vernment associations, provide examples of ized and decentralized models. Los Ange- this potential (Sellers and Lidström 2007). In les has relatively decentralized governing other countries such as the United States, arrangements under a federal state, urban representatives have faced growing whereas Paris relies on a more centralized marginalization in national political processes pattern under a unitary state. The remain- (Dreier, Mollenkopf and Swanstrom 2005). ing cases include Seoul, which has experi- enced recent transitions resulting from The increasingly dispersed, fragmented and industrialization and democratization, and divided nature of metropolitan regions in the Southern metropolises of Jo- many developed countries poses new prob- hannesburg, Mumbai and Sao Paulo. These lems for effective political and intergovern- six examples include two national capitals mental representation of this sort. At the (ParisandSeoul),twocapitalsoffederalstates METROPOLITAN GOVERNANCE 278 Decentralization and Local Democracy in the World (Mumbai and Sao Paulo), and two metrop- Of course, there are significant contrasts. olises that are neither state nor national In Seoul and in the Southern metropolitan capitals (Johannesburg and Los Angeles). areas, the examples demonstrate how pub- The comparative table of the Appendix lic corporations tied to national or other focuses on the main organizations charged higher-level governments play a more per- with carrying out policy implementation in vasive role in many areas. National public nine sectoral domains, including the distri- companies in all of these countries exercise bution of public and private responsibilities. exclusive control over all airports. National or state-held development companies play Regional geopolitical fragmentation by itself a leading role in land-use planning and imposes similar problems for all of these roads. National or provincial governments different governmental structures. As is carry out secondary and ­ except in Mum- typical of other metropolises, the central bai ­ primary education. Even where local city in these cases contains between 19% governments bear much of the responsibil- The metropolitan and 67% of the metropolitan population. In ity, there is less evidence of active inter- regions every case ­even Johannesburg in the local arrangements or local initiatives in wake of the recent metropolitan reforms­ French and U.S. metropolitan areas. Espe- of Los Angeles the local governments across the metropol- cially in the rapidly developing areas outside and Paris contrast itan area divide into multiple units. If we the main urban centers, local government include the infra-local district governance in capacities remain weak. with their Johannesburg, then every configuration of counterparts in the general-purpose governments includes The metropolitan regions of Los Angeles both some local units and a second layer of and Paris contrast with their counterparts in South in their units that takes the obligations of the entire the South in their reliance on stronger local reliance on metropolitan area into account. In each institutions, particularly those commanding case, under both unitary and federal states, the greater resources available to towns stronger local an intermediate unit of government at the outside the urban centers. Yet Los Angeles institutions, regional level stands between the national and Paris differ significantly in their patterns level and these local arrangements. of organizational fragmentation. To a far particularly those greater degree than that seen in Los An- commanding the Even more striking similarities among me- geles, the 1584 communal governments of tropolitan institutions emerge from the metropolitan Paris exemplify a polycentric greater resources breakdown of specific sectors of policy. For model espoused by Public Choice proponents example, a similar configuration of agencies of territorial fragmentation. In trash collec- available to towns and firms addressing needs at national, me- tion, water or sewage and land-use plan- outside the urban tropolitan and local levels carries out transit ning, inter-governmental arrangements in services. Roads administration is also Paris have proliferated more or less in ways centers divided among national agencies responsible that Public Choice theory would prescribe. for big state and national roads, local gov- Even in these domains, however, multiple ernments charged with maintaining local municipalities often depend on unified cen- roads and other governments for the roads tralized agencies or companies. Before the in between. Municipal and inter-local decentralization of the 1980s in France, arrangements manage most trash collection even land use and planning were carried out and land use planning sectors. Against a by national field offices. backdrop of national legislation in all six countries, local or metropolitan govern- By comparison, the 180 municipalities and ments are often given the job of implement- five counties of greater Los Angeles pres- ing environmental policies. These common ent a less fragmented organizational land- trends reflect a transnational understanding scape of general purpose local govern- of best practices, as well as common influ- ments. However, numerous sectors that ences at work within each sector. are centralized in France are decentralized METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 279 and fragmented here. Primary and se- respects more fragmented than metropoli- condary schools present perhaps the tan Paris. Private contracting, a widespread biggest contrast. Unlike any other metro- practice in greater Los Angeles for trash col- politan region, in the Los Angeles area a lection, adds to the organizational fragmen- patchwork of local districts operating almost tation of local service delivery. independently share the primary responsi- bility for this area. Ownership of the area's A full comparison of metropolitan governance airports similarly belongs to four different would include other elements that would be local governments, although the central city difficult to categorize without more detailed owns the largest airport, Los Angeles Inter- comparative case analysis. These include national, and one other. Land-use planning legal norms, fiscal relations between lacks the coordinating intervention that has different levels of government, the role of typified planning at the regional level in private factors, and the dynamics of leader- Paris and in other metropolitan regions. ship. Organizational comparison nonethe- Even pollution regulation is the responsibility less demonstrates both broad global si- of metropolitan-level district organizations milarities in the practical form that created by the state government, rather governance takes and strong contrasts that than being subject to direct intervention by stand out boldly only when differences higher-level governments. The result is an between sectors of governance and policy organizational landscape that is in important are taken into account. METROPOLITAN GOVERNANCE 280 Decentralization and Local Democracy in the World VI. Conclusion: The Emerging In important respects, however, the Metropolitan Agenda problems of metropolitan governance in Southern urban regions still differ from To a significant degree, the governance of those in Northern ones. The growth of 21st-Century metropolitan regions poses si- Southern metropolitan regions has cre- milar questions both for the established ated the largest metropolitan areas in metropolis of the North and for the emerg- the world. More compact, denser and ing ones of the South. The extension and less geographically fragmented, South- increasing diversity of metropolitan settle- ern metropolises are more likely to be ment has imposed new conditions for gov- driven by security concerns born of ernance in the metropolitan areas of both great disparities between affluent and regions. In both, arrangements for gover- poor neighborhoods. Southern metro- nance present parallel dilemmas of frag- politan areas also have fewer economic mentation and coordination. North and and administrative resources to bring to South, the formal institutional alternatives bear on far more pressing and massive for metropolitan governance share similar problems. dimensions. Metropolitan governance pres- ents common problems of accommodating VI.1. Multi-Level Governance an array of diverse, conflicting interests and influences. In both the North and the South, As urban regions have become increas- growing mobility and the influence of trans- ingly extended, and connections with local and trans-national connections are their hinterlands have proliferated, a reshaping the possibilities as well as the better understanding is needed of the imperatives for metropolitan governance. changing dynamics of inter- METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 281 governmental relations between cities provision of adequate water resources and their surrounding regions. Metro- and water quality, especially in the politan regions in both the South and South, presents some of the most far- the North are not only crucial to the reaching challenges. Global and national realization of national policy in numer- efforts to assure air quality and carbon ous domains, but can take an active role conservation depend on sustainable in influencing policies at higher levels. transportation as well as solid regula- tory and energy policies at the local VI.2. Participation in Metropolitan level. Metropolitan initiatives are critical Metropolitan Governance to these efforts. governance Participation in metropolitan governance VI.4. Social and Spatial Inequalities presents common presents important issues for the rea- lization of democracy as well as for Addressing the legal informality and problems effective decision-making processes. poverty of Southern cities is one of the of accommodating Whatever institutional form it takes, highest priorities for metropolitan go- governance at the metropolitan level vernance. Concentrations of the disadvan- anarrayofdiverse, confronts the problem of incorporating taged often require more intervention conflicting the participation of a growing number of and public expenditure to combat related increasingly diverse interests. Un- problems, such as crime, inadequate interestsand derstanding the informal as well as the education and health needs (Pack 1993; influences formal dimensions of participation is Chernick and Reschovsky 1995). In crucial. The challenges surrounding par- diverse, segregated metropolitan re- ticipation are particularly acute for mar- gions, fragmented governance can exac- ginalized groups, such as the urban poor erbate the disadvantages of the poor in and ethnic and racial minorities. obtaining public services (Alesina, Baqir and Easterly 1997). Similarly, extended, VI.3. Ecological Sustainability diverse metropolitan regions can offer affluent communities opportunities and Environmental policy in many domains incentives to segregate themselves from depends on effective implementation at the rest of society. This process can also the local level, and in turn on the effi- undermine collective efforts to provide cacy of metropolitan governance. The goods to the entire metropolis. METROPOLITAN GOVERNANCE 282 Decentralization and Local Democracy in the World Annex 1 Examples of Metropolitan Organization, by Tasks Metropolitan Los Angeles Paris Seoul Sao Paulo Mumbai Johannesburg area Population 196 per km2 927 per km2 1929 per km2 2.314 per km2 4.089 per km2 1.692 per km2 (per km2) Percent in 22.29% 19.00% 44.94% 57.32% 66.90% 38.23% central city Sub-national State (1), counties (5), Regions (1), Province (1), State (1), Metropolitan State (1), municipal Metropolitan or district governments municipalities (180), departements (7), metropolitan local Regions (3), corporations (7), municipalities (3) regional councils of communes (1.584) governments (2), municipalities (139) municipal councils governments (11) City of Paris other municipalities (20) (13), state districts (4), (advisory) villages (900) Transit Amtrak (national rail SNCF (national Korail (national railway), State Secretariat for Indian Railways Spoornet (national company), Metrolink railway), RATP Seoul Metropolitan Metropolitan (national public railway), Metrobus (joint authority of (public company government, Seoul Metro Transports, Sao Paulo company), State Road (central city-owned transit agencies), with metro, bus, Subway Corporation and Seoul Transporte, SA, (private Transport Corporation, company); municipal separate county transit regional rail), Metro Rapid Transit company), Companhia Mumbai Metropolitan governments; provincial authorities (5), OPTILE (network of Corporation (city-owned do Metropolitano de Sao Region Development Department of Public interlocal authorities 39 public, private companies), provincial transit Paulo Metro, Companhia Authority (state agency Transport, Roads, and (6), municipal systems lines), STIVO authorities, municipal Paulista de Trens with participation by Works (39), private lines (network of public systems and private lines, Metropolitanos, and central city), other state and private lines) national ministries Empresa Metropolitana agencies, interlocal and de Transportes Urbanos municipal bus services (state companies), numerous private firms by concession Roads Federal Highway Infrastructure Ministry of Construction and Federal Transportation National Highways National Roads Agency Administration ministry field Transportation, Special Ministry (federal roads), Authority, Mumbai (national roads), (national roads), State offices (region, Metropolitan City Government, State Department of Metropolitan Region Johannesburg Roads Transportation department); Provincial/City/County/District Roads, municipalities Development Authority (central city-owned Department, Regional departments, Government, public (local roads), private (state agency), City company), municipal Council of Governments municipalities corporations (Korea companies by Industrial Development governments (advisory), counties, (local roads) Construction Management concession Co. (state company), municipalities (local Corporation, Korea municipal governments roads Expressway Corporation) Trash collection Private contracting Municipal and a Municipal governments and Municipal governments Municipal governments, Pikitup (central city- (42), municipal limited number of private contracting. Some (mostly), limited use of limited private owned company), other governments (13), intercommunal interlocal cooperation private contracting, contracting municipal governments some interlocal agencies: 65+ municipal firms cooperation (collection), 30+ (treatment) Water/sewage Numerous county, Municipal and a Municipal governments, Basic Sanitation Municipal governments, Johannesburg Water municipal and interlocal limited number of national public corporations Company of the State of City Industrial (city-owned company), utilities or agencies, intercommunal (Environment Management Sao Paulo (SABESP) Development Co. and other municipal private contractors agencies, private Cooperation (EMC), (state-owned Maharashtra Industrial governments, private contractors ENVICO(Korea Environment & company), state Development Co. (state contractors Resources Corporation)) and government, basin companies) interlocal cooperation directed committees of local by Ministry of Environment officials and others METROPOLITAN GOVERNANCE Decentralization and Local Democracy in the World 283 Annex 1 Examples of Metropolitan Organization, by Tasks (Cont.) Metropolitan Los Angeles Paris Seoul Sao Paulo Mumbai Johannesburg area Airports Five (two owned by Two (owned by Two (owned by Korea Airport Three (owned by Two (both under Airport Five (owned by Airports central city, others by Paris Airports Corporation (national public INFRAERO (National authority of India, one Company South Africa separate municipal or (national public company)) public company)) managed by private (national public county governments) company)) firm) corporation)) Land use Municipal governments, Municipal Municipal governments Municipal governments, Mumbai Metropolitan Municipal governments, planning counties, advisory governments, advised by Korea Land private contracting, Region Development advised by provincial council of governments interlocal Corporation (national public Empresa Municipal de Authority (state agency government cooperation, company) and Ministry of Urbanizacao company) with central city private Construction and participation), City contracting Transportation , Seoul Industrial Development Metropolitan Co. (state company), Development Corporation other state agencies, (city owned company) municipal governments Air pollution Air quality districts National Municipal governments and State Environment State pollution control Municipal governments established by state government interlocal cooperation led by Ministry, State board, municipal (2), governed by boards agency field Ministry of Environment Environment Agency governments of local officials offices (CETESB) Water pollution Water quality districts National Metro government and State Environment State pollution control Municipal governments established by state government municipal agencies and public Ministry, State board, municipal (3), governed by boards agency field corporations, Ministry of Environment Agency governments of local officials offices Construction and (CETESB), basin Transportation, K-Water committees of local (Korean Water Resources officials and others Corporation (national public company), nationally designated water test centers (usually public institutions) Primary and Local school districts National ministry National ministry of Education State Secretary of State government Provincial secondary (172) of education Education (elementary (secondary), local government education and secondary), governments Department of municipalities (primary), private Education (elementary) schools Sources: Abers and Keck 2006; Metropolis 2007; Segbers et al. 2007; and governmental and organizational websites. CONCLUSION 284 Decentralization and Local Democracy in the World CONCLUSION Decentralization and Local Democracy in the World 285 CONCLUSION Decentralization and Democracy: A Global Perspective in 2007 Tim Campbell The purpose of the First World Report on addition, recent research from a sampling Decentralization and Local Democracy of academic literature complement and ­and of this overview­ is neither norma- round out the discussion. tive nor prescriptive1. Rather, the aim is to provide a balanced view of the state of decentralization and local democracy in I. The Many Faces of the world. Decentralization and Democracy The opening section of these conclusions The nations covered in this report present provides an overview of trends. The sec- a wide variety of experiences, most of tion also frames the major issues ­the them leading toward decentralized gover- policy objectives and component issues­ nance in some form. The fact that so many that virtually all states must engage to states have chosen to move along the path achieve decentralized democracy, noting of decentralization constitutes a remark- outstanding areas of progress as well as able phenomenon, the impetus for which areas of concern. The succeeding section must connect with deep underlying struc- then reviews each of six central policy tural factors felt around the globe. issues, analyzed from the perspective of their contribution to decentralized democ- Among the more frequently mentioned racy. Next, are emerging sets of global drivers of change are the exhaustion of the issues, selected Millennium Development central state model after the collapse of Goals ­climate change, land use, health, the Soviet Union and the realization that a and gender ­ are directly relevant to local new departure towards state development governments and will require more atten- was required, one that relied on a broader- 1. Theauthorwishesto tion in the future. Another emerging issue, based pyramid of legitimacy and state acknowledge the though not an MDG, concerns metropolitan presence. Meanwhile in Europe, the extensive and detailed governance. Suggestions for next steps to process of regionalization was encouraged contributions of the address the state of inter-governmental by the European Union and many countries World Secretariat of UCLG to the relations and democracy are included in were confronting the emergence of region- preparation of this the closing section. alist demands (Spain, Italy, Scotland, and report. The present Northern Ireland). At virtually the same analysis draws from Though the regional reports provide a cen- time, and for similar reasons, the spread regional chapters from tral source of information for this synthe- of democracy was a palpable form of time to time. sis, additional perspectives are brought in reconnecting citizens and governments, Reference is made to from a variety of local, national, independ- and many actors and grass roots move- the respective chapter ent, and supra-national organizations. In ments pushed for deeper democratization whenever necessary. CONCLUSION 286 Decentralization and Local Democracy in the World in the countries of Africa, Asia and Latin · In North America, higher-level govern- America (Haggard, 1994; Campbell 2003). ments have shifted more of the respon- sibility for financing activities to the local In a related sphere, and about the same level, often cutting back on fiscal support time, liberalization of trade and the dra- from above. New substantive mandates matically increased velocity of global and procedural requirements for transactions suddenly thrust states into a accountability have often accompanied more vulnerable, more competitive envi- these shifts. To varying degrees local ronment, as compared to just decades governments operate under less regula- earlier (Swyngedouw, E. A. 1992; Amin tory restrictions than in other regions and Tomaney, 1995). One consequence of and have sought new modes of service the globalized economy has been the rise delivery through privatization and pub- of cross-state corporate connections. As lic-private partnerships. Various innova- national borders began to lose their impor- tions have introduced elements of tance as markers of comparative advan- interlocal cooperation or territorial con- tage, regions and cities became the next solidation. distinguishing feature on the economic landscape (Harris, 2003; Taylor and Watts, · In Africa, implementation of the 1995). Some authors point to the decentralization process has rarely "...opposing forces of horizontal competi- been properly planned. Many countries, tion imposing market based disciplines in especially south of the Sahara, have Europe... constrained by within-country undertaken reforms in the field of redistributive tendencies and mobility- organization of the state and public life, based competition." (Salmon, 2007). particularly by adopting decentralization Accordingly, a regional perspective on eco- policies. These countries have organized nomic development began to assume an local elections, which have seen local important place in both the process and authorities emerging as new public the outcome of decentralization. authority figures alongside the national authorities. In almost all these coun- tries, this splitting of public authority Snapshot of the Regions has caused problems, as this major institutional change has not yet been In short, looking across an extremely reflected in the behavior of most nation- diverse set of nations grappling with a al authorities. But in West and Central complicated field of issues, nations have Africa, apart from Mali, Senegal and moved on decentralization in a half dozen Burkina Faso, there is no real plan to distinct directions, and have not held close implement decentralization, which to any single normative framework to seems to rest on policy announcements. guide the formulation and implementation And in North African countries the of decentralized governance. autonomy of local government is still restricted overall in relation to the cen- · European countries seem to have tral state. embarked on a new phase of territorial reforms. Not all states are similarly · In Eurasia, the main idea of the reforms affected by this development, with was to separate the state from local some in fact remaining outside of it. In self-government. Legal reforms have essence, the reforms are concerned been approved, but for the most part with strengthening the municipal and the functions of local authorities are not intermunicipal framework, a trend to clearly defined. The Soviet system of regionalization, and the problems relat- sub-national government forms a le- ed to organizing urban areas. gacy that continues to influence the CONCLUSION Decentralization and Local Democracy in the World 287 evolution of decentralization. The prin- · In the Middle East and Western Asia, in ciple of local autonomy has often come spite of the ceaseless political, military, into collision with that of regional and religious tensions, some advances autonomy and nowhere more than in deserve recognition: the first local elec- the Russian Federation from the early tions in Saudi Arabia, the holding of 1990s onwards. It is possible to distin- democratic local elections in the West guish three groups of countries. In the Bank and Gaza, the restoration of the first ­ Armenia, Azerbaijan and Russia ­ mayoral elections by universal suffrage local governments could be seen as in Jordan, and the 2002 constitutional independent institutions. Whereas reforms in Bahrain. In Turkey, three in the second group ­ Georgia, Kyrgyz new laws favourable to decentralization Republic, Moldova and Ukraine ­ the were adopted in 2004-2005. Decentral- process of the formation of local self- ization is one of the criteria for mem- government is still not concluded. bership of the European Union. Reforms can hardly be implemented, or simply could not be achieved until now. · In Asia Pacific, decentralization has The third group is composed of the become a major theme of governance states of Central Asia (Kazakhstan, reform over the past decade and decen- Tajikistan, Turkmenistan, Uzbekistan) tralization has for the most part been where local issues in this region are accompanied by enhanced local democ- vested in local state organs subordinate racy. But the forms and patterns of local to central government. governance have varied widely, as have the outcomes, reflecting the diversity of · In Latin America, the three biggest country contexts. While there are clear- nations (Argentina, Brazil, Mexico) all fed- ly a great many weaknesses in the cur- eral systems, focused mainly on strength- rent arrangements for decentralized ening the intermediate levels of governance, and while further reforms government, although Brazil shifted more will undoubtedly be required, it is hard weight to the municipal level. In Repúbli- to imagine that any wholesale return to ca Bolivariana de Venezuela, also a feder- a centralized system of governance al country, contradictory reforms are would be either appropriate or political- actually taking place that could affect the ly acceptable. nature of local institutions. In the Andean countries, decentralization has taken place through far-reaching constitutional Framework of Issues and legislative reforms, in relatively brief processes.ColombiaandBoliviaproduced In short, decentralization has been pur- comprehensive visions of reforms in the sued by different countries with different early 1990s. But economic and political objectives ­ some political, others more crisis altered their coherence and slowed economic, still others give more weight to the pace of their implementation. In Peru, better services or democracy. Further- the process of decentralization restarted more, states have placed emphasis on dif- after2000followingareversalofdirection ferent combinations of the half dozen in the 1990s. The unitary states of the strategic areas which must be engaged to Southern Cone ­ Chile, Uruguay and decentralize successfully. These include Paraguay ­ have also carried out reforms national policy, state organization, respon- shaped by their respective characteristics. sibilities of local governments, intergov- Central American countries have enacted ernmental finance, mechanisms of par- laws on decentralization, and their main ticipation, and capacity strengthening. challenge is to achieve their implementa- Taken together, the objectives and strate- tion. gic areas constitute a framework for un- CONCLUSION 288 Decentralization and Local Democracy in the World derstanding the breadth and depth of the advice and counsel for their neighbors in decentralization experience. the region. Reviewing the uneven record, Cheema and Rondonelli (2007) point to To illustrate, from the snapshot of cases, ineffectiveness in implementation, as political reforms were mixed with economic opposed to weaknesses in the concept of restructuring in some regions, notably in the decentralization itself. They also caution transition states in Eastern Europe, the for- about the use of parallel administrations mer Soviet Union, and China and Vietnam. at the subnational level, a ploy that is Still others centered on democracy and ultimately self-defeating. The most trou- modernization of the state as in Africa, Latin bled cases, from the point of view of America and in some countries in Asia (e.g. power-sharing and democracy, are those Indonesia, Philippines). Improved services countries afflicted by armed conflict or oil were perhaps a more notable priority in wealth. They present understandable North America, Australia and New Zealand. sluggishness, even resistance. And though this categorization is far from neat, pursuit of policy and practice, espe- In the middle, a disparate collection of cially in political reforms, economic develop- countries that, with few exceptions, are in ment, and finance, has strayed even further an active tug of war over the state of afield from the avowed objectives of many decentralized democracy. Some detailed states. examples, below, are drawn from the regional chapters. Velocity of Change · The most exemplary case in this respect is South Africa, where the end Turning to the pace of change in decentral- of the Apartheid regime imposed a new ization, the nations covered in the reports approach to governance based on can be classified very broadly in three decentralization and involving the groups. At one extreme, are those coun- entire population in public management tries (many of them higher income GDP) at all levels. In most francophone coun- where decentralization has advanced quite tries of Africa, the profusion of statutes far, having built on 50 years or more of complicates the implementation of consolidated local government. In many decentralization and slows things down, countries of this group (and some coun- causing substantial delays between tries in other groups, as noted below), approval of laws and their actual deliberate if not measured progress has enforcement (delays of 10 years are been made on policy and technical issues common). In countries of North Africa, in a search for what must be called a the pace of decentralization is uneven. dynamic balance in power sharing. Shifting political preference is complicated by grad- · In Latin America, some countries, such ual improvement in institutional capacity as Bolivia, Brazil, Chile, Colombia, Peru, and occasional shifts in technological pos- and República Bolivariana de Venezuela sibilities, all of which can move the fulcrum started early and, with Argentina and of balance in central/local relations. Ecuador, went further than others in the devolution of functions and resources. At another extreme, mainly but not Peru and República Bolivariana de entirely in the Middle East, are those venezuela reversed some of the decen- countries that are taking a long, slow tralization reforms begun in the 1980- take-off, mostly in the direction of 90s. Mexico has moved forward with a improving participation at the local level. "new federalism," but progress is slower A few countries are making good faith at the municipal level. Other countries efforts and show promise to be sources of are evolving to a lesser extent. CONCLUSION Decentralization and Local Democracy in the World 289 · In Eurasia, particularly in Eastern II. Progress and Pitfalls: Europe, reforms were taken quickly to Six Core Issues dismantle the former system and move toward local self-government, Though the preceding introduction may be and at present the countries have rhetorically useful for grasping a glimpse attained different levels of institutional of the global state of affairs, it is not a tidy development. In some countries local categorization and has limitations in terms self-government exists as an inde- of understanding the tactical issues in pendent institution, while in others implementation. Countries are in various reform has not been implemented. degrees of engagement with the six areas of policy 1) national policy and strategy, 2) · In Asia-Pacific, Indonesia, the Philippines, organizational units, 3) responsibilities, 4) and India provide the most dramatic financing, 5) mechanisms of participation examples of major reform for enhanced and accountability, and 6) institutional local government autonomy. Countries capacity. This section reviews the six core such as China and Vietnam have adopt- issues, noting trends across or within ed decentralization strategies within the regions, and spotting promising areas of context of strongly centralized political progress where lessons may be useful in a ruling systems. In some other coun- wider setting. tries, like Pakistan, there has been a noticeable cyclical movement to and fro Policy and Strategy between periods of centralization and decentralization. By contrast, in This review of countries and regions Bangladesh and Malaysia resistance reveals a wide spectrum of policy positions from the center has impeded any sub- and organizational strategies for local gov- stantial decentralization that would ernments. Though few countries have full- strengthen the political role of local blown strategies, as we note below, most government. Finally, the OECD coun- make some reference to the European tries in the region, Australia, Japan, the Charter and Guidelines on Decentralization Republic of Korea and New Zealand, (see Box 1, below). Both documents refer to also emphasize decentralization as part principles that have been widely discussed, of their ongoing administrative reform synthesized and generally accepted by the processes. international community. The European Charter was published in 1985. UN Habitat With these two perspectives ­ on strategic in close collaboration with local authorities objectives and on velocity of change ­ we produced Guidelines on Decentralization. turn now to explore how the nations and local governments have approached the Only a handful of nations have framed a organization of the state. To what extent comprehensive policy on decentralization, have policy frameworks guided the design blending political reform (power-sharing), and implementation of decentralized go- economic development, and democratic vernance? What changes have been made choice-making with capacity-strengthening in assigning functions, in providing ade- and financing in order to produce a long quate finance, and arranging for participa- term solution. As noted above, Bolivia, tion and democracy? How closely have South Africa, and Indonesia have each governments adhered to international ex- mounted comprehensive elements, but not pectations and standards as expressed in a complete strategy. Bolivia and South the UN Habitat Guidelines on Decentraliza- Africa produced comprehensive visions (in tion and the Strengthening of Local 1992 and 1994, respectively), and though Authorities and the European Charter of Bolivia recently reaffirmed its intentions Local Self-Government? (Government of Bolivia 2006), neither go- CONCLUSION 290 Decentralization and Local Democracy in the World Box 1 Guidelines and Charter of Europe UN Habitat Guidelines on Decentralization and the Strengthening of Local Authorities · The principle of subsidiarity constitutes the rationale underlying the process of decentralization. According to that principle, public responsibilities should be exercised by those elected authorities, which are closest to the citizens. · In many areas powers should be shared or exercised concurrently among different spheres of government. These should not lead to a diminution of local autonomy or prevent the development of local authorities as full partners. · National, regional and local responsibilities should be differentiated by the constitution or by legislation, in order to clarify the respective powers and to guarantee access to the resources necessary for the decentralized institutions to carry out the functions allocated to them · As far as possible, nationally determined standards of local service provision should take into account the principle of subsidiarity when they are being drawn up and should involve consultation with local authorities and their associations. · Local authorities should freely exercise their powers, including those bestowed upon them by national or regional authorities, within the limits defined by legislation. These powers should be full and exclusive, and should not be undermined, limited or impeded by another authority except as provided by law. European Charter of Local Self-Government · Basic powers and responsibilities of local authorities shall be prescribed by the constitution or by statute · Local authorities shall, within the limits of the law, have full discretion to exercise their initiative · Public responsibilities shall generally be exercised, in preference, by those authorities which are closest to the citizen. · Powers given to local authorities shall normally be full and exclusive. · Where powers are delegated to them by a central or regional authority, local authorities shall, insofar as possible, be allowed discretion in adapting their exercise to local conditions. vernment has been able to sustain coher- financial assistance organizations like the ent effort to implement its strategy. World Bank and the regional development banks adhere to a market-based approach, Indonesia's sudden "Big Bang" of reform is seeking to introduce quasi-market mecha- notable for the scope of change (transfer- nisms to guide supply and demand of pub- ring several million public sector workers lic goods. The Asian Development Bank to local authorities), but not for the inte- does not have a specific policy paper on grated, long term solution needed. None of decentralization. Instead, it focuses on these countries has developed a compre- good governance and corruption. hensive decentralization plan, a blue print with concrete objectives and milestones to The Inter-American Development Bank (IDB) guide the decentralization process, includ- published its public sector strategy in 1996 ing local capacity strengthening and a cen- and last year issued a companion policy tral agency to see through the entire paper on the issues of implementing de- process. Even when piecemeal legislation centralization (IDB 1996, 2002). Like most is in place, sluggish regulation drags down development banks, the IDB policy starts the speed and limits the reach of imple- with the fiscal imperative of macroeco- mentation. nomic stability. Guarding against excessive debt, and particularly sub-national debt International institutions ­ financial, tech- held by domestic banks and even suppli- nical, and political ­ have had no shortage ers, is not merely to keep the banks in line of normative frameworks to recommend to with their primary stakeholders, national governments, yet neither do they fully governments. It is also to safeguard expo- address the practical issues of implementation sure to risk and increased cost of borrow- most governments face. The international ing on international capital markets. CONCLUSION Decentralization and Local Democracy in the World 291 A companion principle in the international under-financed decentralization schemes im- finances institutions (IFI) framework is posed on poorly-equipped local govern- management of economic systems free ments. from distortions (for instance, due to inter- ference in local decision-making). Efficient Organization of the State resource allocation places a premium on expression of demand, especially at the The inchoate nature of national decentral- local level. The banks also recommend ization policies is mirrored by piecemeal clarity in the division of labor among levels measures, either explicit or tacit, to of government. All of the development organize administration of the state at banks espouse a similar line in connection the local level. This may be partly due to with reform of the state. the dual nature of governmental units. Governments have both territorial and The World Bank recently cast decentraliza- functional aspects. They are put in place tion issues in terms of poverty alleviation to connect to citizens and they operate to and services for the poor. Building on earlier deliver services. Decentralization experi- work devoted to reform of the state (World ences sometimes get wrapped up with Bank 1995), the World Bank's World Devel- these multi-dimensional features ­ fed- opment Report (WDR) of 2000 dedicated a eral, unitary, territorial, functional ­ pro- chapter to decentralization, and the 2004 ducing a system of governance which is in- report focuses on services to the poor, argu- complete or out of sync. ing that politicians, providers and the poor must be brought into tighter juxtaposition Many federated systems accord to states, with one another in order to improve provi- with their own constitutions or legal stat- sion of and access to basic health-care and ues or both, the powers to govern, regu- education. A key mechanism is "local voice." late, sometimes even create, lower tier, Expression of demand at the local level municipal governments. For the most part goes hand in glove with the idea of partici- federated systems have been adopted in patory democracy. The Bank points out that large territories, as for instance in Russia, local government plays a key role in certain Brazil, and India, and often, national go- circumstances, for instance, when local vernments like Argentina, USA and India populations are more or less homogeneous have left many issues for the states to and when services are easy to monitor. decide. This can either compound or help These tests could prove useful in evaluating to solve problems, depending on the sys- policies of nations and roles of local govern- tem in question, i.e., states can help coor- ments. dinate, but as the regional reports have shown, they can also introduce confusion Thus, governments have the benefit of se- and interfere with national policy on both veral international sources on general prin- functional and representational issues. ciples. We shall see in the ensuing discus- sion that more practical strategies of Some states were more inclined to respond implementation might be useful. Before to a clamor for representation, as in the moving on, note should be taken of impor- majority of African, some Latin American tant areas that have been largely ignored and some Asian countries in the 1990s. and should be addressed in the future. Most states in Eurasia have created or ex- One gap is the calculation of the cost to tended local government units to accom- the nation of decentralizing in a piecemeal modate regional or ethnic groups. Other or haphazard way. None of the regional countries (New Zealand, Germany) focus chapters speak of the economic and social on the functional side, aiming to improve costs of burdens being transferred to local the extension or efficiency of services. This authorities in the shape of half-baked or sometimes means a diminution of numbers CONCLUSION 292 Decentralization and Local Democracy in the World Figure 1 Local Governments and Population Percentage Distribution, LAC 40 35 30 25 t en 20 ercP 15 10 5 0 <5,000 5,000 10,000 50,000 100,000 500,000 1,500,000> Population range Local governments Population Percentage distribution LAC Source: IDB 2006. in local government units. In OECD coun- local units ­a step that is frequently tries, a wave of amalgamation is taking allowed in national legislation. North place to reduce the sheer number of local American local governments have fewer government units in the interest of improv- constraints imposed upon them about ing efficiency. OECD Countries such as the cooperating across boundaries, both ho- UK, Belgium, and Greece, among others rizontal and vertical (with states). The have reduced the numbers of go- US is unusual also in having developed a vernmental units by substantial fractions. large number of special districts; govern- Where local units were weak in the past mental units with high target finance and (Hungary, France, Italy), new tiers have a tightly focused mandate (for instance been created to handle new tasks. in primary education, environmental con- trols or fire safety). The wide range of organizational approaches, and even conceptions of local Outside Europe and North America, Japan government, makes head to head compar- is the only country that provides examples isons between nations not just difficult, but of policies of amalgamation of municipali- also ultimately unproductive. Neverthe- ties. Horizontal cooperation among first less, it is useful to gain an appreciation for tier units of government is taken up again the variations in approaches taken by in a later section of this paper on metro- states in different regions. politan governance. Many countries are experiencing prob- It should be noted that the sheer numbers lems where units of government overlap of small local governments implies a policy in dense urban areas. Countries have ex- dilemma. The weak institutional capacity plored various kinds of partnerships among of many small local governments affects a CONCLUSION Decentralization and Local Democracy in the World 293 Box 2 Subsidiarity--an issue at the heart of autonomy--is viewed in different ways by academics, political organizations, and development institutions Oates, 1972 "Assign to the lowest level of government possible, those local public goods and services which can best be delivered at that level." World Bank "The lowest tier of government that can internalize the costs and benefits of the service." 2004, p. 189 European Charter "Public responsibilities shall generally be exercised, in preference, by those authorities which are closest Art. 4.3 to the citizen." minor share of the population, while a few ernments, in practice, states find many strong local governments of big cities hold dilemmas when implementing subsidiarity an important share of the population (see (See Box 2). Figure 1). Take the example of Latin Amer- ica, a region with 16,400 units of local States also face many temptations to push government and a population (2005) the limits, like shifting responsibilities to of nearly 550 million. Less than 5 % local governments with little or no consul- of local governments ­ those in big cities tation and without corresponding financial ­ contain more than half the popula- resources. The issues related to responsi- tion, while more than 53 % of local go- bilities can be summed up as follows: a) vernments in small towns and rural areas clarity and consistency in observing sub- cover less than a tenth of the population. sidiarity and autonomy of choice; b) Similar proportions are found in most re- achieving efficiency in allocation and in gions (see Figure 1). delivery of services, an issue that involves public and/or private provision of service; In a nutshell, the issue of organizing local and c) the impact of technology. government units is one of balancing a tension between two imperatives. Effec- Subsidiarity and Autonomy in Choice. tive representation is needed to serve Most countries have devolved a core set of democracy, but this tends to require mo- local functions, and many countries gradu- re units of government. Against this ex- ally adjust these, as circumstances pansionary push is a constricting pull to require. On the one extreme are China's reduce the number of units, or fold them big cities that handle supra-local functions into higher tier governments in order to like judiciary, pensions, and economic achieve economies of scale and more development. A more typical arrangement efficient service delivery. Virtually all involves local public services, like water countries in the middle and many in the connections, streets, solid waste, local advanced stages are engaged at some markets, urban and land use planning, and level with this issue. primary care in health and often educa- tion, social policy and sometimes economic Responsibilities development and housing. The logic of assigning responsibilities to In Europe the most important variations local governments is to achieve efficacy or relating to powers and responsibilities efficiency in delivery of local goods and occur in the fields of education, health, services to citizens. And though the guide- and social security or benefits. Broadly, line principles of subsidiarity and auton- local governments are responsible for such omy provide a normative standard for gov- services in the Nordic countries and to a CONCLUSION 294 Decentralization and Local Democracy in the World large extent in the United Kingdom. Others tral government defines strategic guide- restrict assignments to be either exclusive lines for sectoral policies regarding health, (land-use controls in many countries) or water and education and local govern- shared, such as primary education in most ments are responsible for implementation. countries and in others, police and secu- rity. Still others share responsibilities. Direct intervention by higher levels is Turkey provides an example of a modus another form of disturbing subsidiarity and vivendi in which municipalities and the violating the principle of choice. Ambigu- Special Provincial Administrations (SPAs) ous or overlapping jurisdictions sometimes share public services, including education lead to "end run" practices ­nominal (maintenance of school buildings). decentralization coupled with direct deliv- ery by central government. This repre- None of these variations necessarily vio- sents a significant slippage in the way gov- lates the principles of subsidiarity and ernments should work. Serious problem autonomy. The problem comes, as regional arose in Latin America in the 1990s when reports frequently show, when assign- central governments either delivered ments are shifted in a way that is unclear, directly to local citizens, as a means of gain- is ambiguous, or is unreasonable, arbitrary, ing political support, or simply fell short on or inconsistent. For instance, in the US, coordination, meaning that both central recent devolution of Home Security respon- and local governments were spending on sibilities suddenly imposed severe financial redundant services, resulting in the constraints on many cities. Another exam- increase of economic costs to the nation ple is found in Eurasia, where in most (Peterson, 1997). Similar problems have countries the functions of local authorities been detected in Russia. are not clearly defined by law, largely because of an unending process of redistri- Intervention from higher levels of govern- bution of powers between different levels ment in Europe is currently the focus of of government. In the Middle East, on the debate in connection with the European other hand, many countries designate local Community Laws on public service man- services in national law, but these are agement subject to competition rules. The sometimes ambiguously worded, contra- issue is the extent to which, in seeking to dicted, or ignored. The report on the Middle provide certain services, national powers East notes that formal assignments are effectively limit local self government. The "highly idealized and out of step with real- position of local governments is that they ity..." (of local authorities and institutional should enjoy complete freedom to choose capacity). the modality of service provision that best reflects the needs of their communities. In Africa, while public assertion of the new nominal powers of local governments is The uncertainty and lack of definition illus- widespread, the actual transfer of real trated in these examples ­examples which executive and operational powers is still are a few among many cited in the rare. In Northern Africa, national min- regional reports ­ effectively rob the sub- istries typically retain control of local serv- sidiarity principle of its virtues and limit ices, or delegate them to the private sec- the choice of local governments. tor. This tendency can also be observed in West and Central Africa, although basic Efficiency in Allocation and Produc- services there for education, health, water, tion. A second aspect of the assignments sanitation and transportation are generally issue is efficiency. Two distinct functions acknowledged as local concerns. In several are involved: 1) deciding on what is eastern and southern African countries, needed (allocation efficiency) and 2) actu- like Ghana, South Africa and Uganda, cen- ally delivering the services (production CONCLUSION Decentralization and Local Democracy in the World 295 efficiency). Allocation efficiency is one of structure represented a small and the principal economic rationales for decreasing proportion of the total in local decentralization. It is to ensure public sec- public and urban infrastructure in the tor decisions are made close to the citizens 1990s (Annex 2006). who use (and may need to pay for) infra- structure and services. For this reason, Technology. Finally, few if any assignments participation in choice-making ­ in voicing of functional responsibilities will hold for all preferences and voting in local elections ­ time because of shifting preferences, polit- is important. These topics are covered in a ical agendas, and administrative capacity more organic way in a subsequent section, in government. Changing technology also below, having to do with participation and plays a role. Technological change in such choice. fields as distributed solar power, health care diagnostics, distance-learning in edu- One of the front edge issues in the deliv- cation, and water purification can affect ery of services is whether and how much the placement of responsibilities. Further- to contract out, to privatize, or to dele- more, the time cycles of change ­ either gate. In the case of the Middle East, men- of decentralizing functions or bringing new tioned earlier, so-called "external solu- technologies on line ­ have similar life tions" include joint service councils for cycles. This means that a well-intentioned infrastructure in small rural areas and country might, say, centralize diagnostic neighborhood committees. A survey of aspects of health care and take three or North American local governments in 2003 four years to accomplish it, only to find showed that as many as two-thirds of the that during the period of implementation, municipalities had tried privatization of technological progress now permits so- some kind, although this trend has phisticated diagnoses to be done virtually declined in this decade. New Zealand and anywhere. For these technological and Australia have followed a steadily expand- other reasons, the assignment of responsi- ing privatization policy. In other coun- bilities is probably best viewed as a mov- tries, the reform process that has been ing target. reliant on the private sector has led to a reduction of local government competen- cies (UK, Holland and Sweden). Financing Decentralized Systems In the 1990s, public-private-partnerships When assignments change, so should fi- (PPP) were advanced by the international nance. Inter-governmental finance is financial assistance agencies (World Bank, inextricably linked with decentralization Asian Development Bank, International Fi- because the vast majority of states on the nance Corporation) as a promising solution planet have more than one level or tier, to lagging investment and poor manage- and lower tiers of government are rarely, if ment by public agencies. PPPs promised a ever, financially self-sufficient. In fact, it is practical alternative for financing the ever- worth noting that the notion of pure finan- growing demand for services. The argu- cial autonomy for local governments is illu- ment reached the point of suggesting sory. Even the richest countries, for in- that local governments should limit them- stance those in the G-8, support half or selves to a strictly "enabling function," more of local government expenditures leaving service provision in the hands of a through revenue transfers of some sort. competitive private sector (European Constraints on many local governments in Commission). In hindsight, the promise of the south ­ for instance limited or no abil- private sector investment in infrastructure ity to set rates, raise taxes, or borrow ­ was overestimated. A World Bank report make the idea of financial autonomy even shows that private participation in infra- more remote. CONCLUSION 296 Decentralization and Local Democracy in the World Figure 2 Local Government Expenditures, Sample Countries 70 60 60 55 g 50 Spendin licbuPfo 40 35 30 25 aget 20 en 15 20 ercP 10 10 5 0 1 2 3 4 5 6 7 8 Legend: 1. Costa Rica, Nicaragua, Panama; 2. Botswana; Belarus; 3. Israel, France, Belgium; 4. Albania, Bulgaria, Poland; Latin Ameri- can average; S. Africa; 5. Netherlands, Italy, UK; Uzbekistan; 6. Norway, Sweden, Finland; 7. Denmark; 8. N. Antilles. Source: World Bank 2004. National governments structure many ways upward trend over the past few decades. to finance local investment and services, At the low end of the spectrum are some and almost all of them involve issues of tax Caribbean islands (zero) and a number of (and rate setting), borrowing (or private countries in the Middle East, which range involvement), and revenue sharing. But in a few percentage points of total govern- each of these singly and in combination ment spending. The chapter on Africa entails issues of policy and practice, reports a range of five to 10 percent in 30 including mechanisms of control, capacity African countries. Most of Latin America is constraints and problems of transparency under 20 percent, but it is notable that this and discretion. The question is how have proportion has increased from 11% to current practices around the globe 18% in the past two decades. On the high engaged and solved these issues? end are countries like Denmark, Switzer- land, Finland and Sweden. More than Though regional reports document a wide- anything, these figures suggest that many spread growth in the share of spending by formulas for spending are in use. local governments relative to central gov- ernment spending, the share is small in all On the income side, central governments but a few cases. Denmark and the Nether- are in the habit of restricting the income lands Antilles are the only two countries potential of local governments. In Latin where municipal spending is over 50 per- America, local governments depend on the cent of the total sub-national spending. executive or legislative branches and some- times the states in federated systems to Figure 2 shows spending by all sub- set taxes and, in some instances, to set national tiers. Municipal-level spending tariffs. Fiscal power in the Middle East, ranges widely and on the whole is on an Africa, and Eurasia is even more limited or CONCLUSION Decentralization and Local Democracy in the World 297 nonexistent, with very low levels of rev- the willingness of national governments to enue (excluding Turkey, Zambia and South offer sub-sovereign guarantees, bond Africa). More than half the countries in the financing can be feasible for a handful of Asia-Pacific region have own-source rev- well-managed local governments. enues above 30% of the total. The same pattern holds in North America and Europe Transfers from central government, in grants (around 40%). or revenue sharing, are the most common way to cover local government costs (the so- Perhaps the most troubling trend is the called "vertical gap"). They are also useful in tendency of central governments to helping less advantaged regions ("horizontal impose spending responsibilities on local gap"). Intergovernmental finance specialists governments without loosening the con- have a multitude of tools ­automatic, for- straints on income. These unfunded man- mula-driven revenue sharing, block grants, dates are a burning issue in high income and conditional grants, for instance, that countries and some southern countries. have matching requirements and other Virtually all of the regional reports mention refinements. Fiscal specialists are learning (but did not quantify) increasing burdens about the multiplier effects of conditional on local governments. grants (Shah 2007) and the importance of hard budget constraints (Rodden, Eskeland Non-tax sources of income ­ borrowing and Litvack 2003). and private finance­ have been tightly cir- cumscribed in most countries. In the first A tension in financial imbalance is discerni- place, only a small fraction of local govern- ble in virtually every report. The theory of ments are credit worthy. Some countries intergovernmental finance is not the prob- (Chile) flatly prohibit borrowing; others lem. The problem arises more with ambigu- (Philippines) are experimenting with grad- ous or changing rules (Latin America), lack uated systems of indebtedness. In the of transparency (Middle East), and excessive European Union, the newer states enjoy discretion (Africa) on the part of central gov- fewer restrictions on borrowing. Often, the ernments in implementing revenue sharing potential for revenue mobilization varies programs. Wescott (2005) provides a review directly with city size, and the distinctive of these arrangements and the questions advantage of larger cities echoes an earlier they raise for nations and the Asian Devel- discussion about the possible practical opment Bank in the case of several Asia- advantages of managing decentralization Pacific countries. by size class of city. One more point deserves emphasis. For the Even when credit worthiness can be estab- most part, intergovernmental transfers are lished, national governments face moral formulated, promulgated, and defended by hazard issues of sovereign guarantees. India central governments, often on advice from has begun to experiment with syndicated international financial institutions (IFIs). The subnational borrowing by packaging loans to point of view of local governments is rarely groups of local governments. European given equal weight in adjusting the system. countries are discussing municipal credit, In the case of Latin America, constant tinker- somewhat along the lines of the Swedish ing with transfer formulas left local govern- and former Belgian municipal funds. Munici- ments perpetually in the dark about prospec- pal bonds are common in the US. They are tive income from year to year (Peterson, approved by voters at elections and enjoy 1997). An added problem is imprecision of tax advantages, but these arrangements data. The regional reports speak of a fiscal would be of dubious feasibility in lower squeeze in which local governments have income countries. Depending upon the state more responsibilities without the financial of capital markets, credit worthiness, and means with which to discharge them. None of CONCLUSION 298 Decentralization and Local Democracy in the World the regional reports contains data to measure ism is taking hold" and the North America the magnitude of this squeeze. Indeed, many report notes an independence from parti- reports call attention to the need for reliable, sanship. Further, in North America "...single- time-series data to document financial and member electoral districts, frequent elec- other issues (for instance, personnel). Even tions, direct democracy, and greater local fewer countries have accurate numbers on choice set local institutions in these coun- the costs of delivering local services. Objec- tries apart" from others with British tradi- tive cost and expenditure data are vital to tions like Australia and New Zealand. help decision makers formulate and defend policies on finance and spending. Yet a number of concerns persist in connec- tion with local elections. One issue signaled Local Democracy: in several regions is the tendency for national Participation and Accountability partisan issues to crowd out local concerns. Some observers feel that local and national One of the signal features of decentraliza- elections should be staggered in time in tion, and one of its bright spots, is the order to prevent local elections from be- renewed connection between citizens and coming miniature battles of national issues. government. The regional reports docu- A second issue is low turnout of voters in ment a growing tendency of involving citi- local elections. With some exceptions, zens in the decision-making process. This turnouts are in decline in North America, is important for economic reasons ­ the Europe and Eurasia and decreasing in some allocative efficiency discussed earlier ­ and parts of East Asia and the Pacific. for political reasons of legitimizing local government and holding elected leaders Still another issue, one that requires much accountable for their actions. In practice, more scrutiny, concerns the rules of elec- governments employ many modes of par- tions, not just the timing, but also how ticipation and choice-making. winners are declared (first past the post versus majority or slate lists) and the The range of issues considered in the par- issues of direct and indirect elections, the ticipatory dimension of decentralization in- periods of office (often short, three to four cludes: or five years), and whether electoral rules a) elections and electoral rules; allow for self-succession in re-election. b) the focus on chief executives and coun- Short periods and prohibitions on re-elec- cils at the local level; and tion make it difficult to design and imple- c) modalities of voice, participation, and ment significant programs at the local choice. level. Elections. The very fact that elections are Executive and Legislative. Much of the taking place at the local level in most focus of local democracy has been on the regions of the world is by itself a notable city or municipal executive ­ mayor, prin- achievement. The regional reports note cipal officer, or municipal president. Selec- "important gains" in Europe and that, "un- tion of chief executives is not always di- deniable progress" has been made in Africa, rect. Countries have structured indirect LAC, Asia, Eurasia, and MEWA. Several means to select second tier executives or reports refer to political parties and election to accommodate minority parties at the rules in connection with local democratic local level. But direct elections appear to choice-making. The Eurasia report notes have increased accountability (in Europe). that elections are "increasingly competi- Some countries ­ for instance Indonesia tive," and in Asia-Pacific, that "multi-party and Vietnam ­ are beginning to relax the democracy is thriving" and is the norm. In rules on candidacy. In Asia-Pacific and Latin LAC, the regional report notes that "plural- America, big city mayors are a well-known CONCLUSION Decentralization and Local Democracy in the World 299 stepping stone to higher political office. On cils to hear citizen opinion and deliberate. the other hand, more than half the North A good example is the Gram Sabha in American cities have adopted a council rural India, a mandatory meeting of reg- manager form of executive, separating istered voters called to decide important political functions from the day to day issues. Table 1 illustrates the many ways operations of running a large city. City that citizens at the local level take part in managers bring certified, professional planning, implementing and monitoring skills to handle the complexities of modern local government activities. city management. The disadvantage of the manager (or in Russia the hired manager) However, evaluative research reports that system, is that this arrangement puts the participation by itself does not mean that CEO of the city one step further away from governance or services are better or that direct electoral accountability, since most poverty is any more quickly reduced, or managers are hired by, and are account- even that local autonomy is safeguarded. able to, the city council. One tricky issue concerns interventions by central state actors on behalf of disad- Modes of Participation. Modes of par- vantaged people at the local level (John- ticipation by local citizens ­ i.e., expressing son et al 2005 in India; Tendler 1997 in voice and making choice ­ are the most Brazil). Other studies have focused on the colorful and innovative spots in the conditions of successful participation. unfolding story of decentralization and Crook and Manor (1998), suggest that in democracy. Perhaps the most refreshing the cases of South Asia and Africa, the message in the reports is that many impact of participation depends on pre- countries in Africa (for instance, Ghana, existing conditions and the type of partic- Niger, and Uganda) in Asia (India and ipation employed (see Table 1). Pakistan) in East Asia (Philippines) and in Latin America draw on tradition and cus- Still others argue for the importance of tom, making creative use of village coun- connecting participation to the deeper issue Table 1 Sample Mechanisms of Participation and Their Functions Area of effectiveness Participatory mechanism Policy and planning Demand preferences and budgeting Implementation and oversight Accountability Tapping into grassroots opinion Gram Sabha, India; neighborhood councils (Africa, Middle East) Mobilizing grassroots groups Participatory budgeting (several countries in LAC, Neighborhood work gangs, Comités de Vigilancia (Bolivia) Philippines, Europe). many countries Beneficiary contributions Mayor's funds (Chile) Bond measures in US Citizens initiated contact Voluntary neighborhood Rating systems India, US organizations in Japan Electoral and voting process Programmatic campaign Referenda in US, Europe, and (Colombia) Eurasia (permitted but not used). Legal and judicial system Impeachment, LAC, US, Canada Source: Adapted from Campbell 2003. CONCLUSION 300 Decentralization and Local Democracy in the World of citizenship and citizen rights (Hickey public sector (often ignoring differences and Mohan, 2005). Local leadership, cen- across countries in responsibilities tral monitoring, an articulate civil society, assigned to local governments). and the right kinds of information are all necessary, though not a guarantee that A somewhat more useful ratio is the government services will work better number of local government personnel in (Devas and Grant 2003). Several of the relation to the population. This figure, regional reports speak of serious issues in compiled from the regional reports, runs the free flow of information and the need from 2 per 1000 population in West to ensure the availability of information, as Africa to over 43 per 1000 population in represented in legislation on freedom of the US (see Table 2). information (Philippines, UK, US). Another way to normalize the data is to A somewhat deeper modality of partici- express municipal staff in relation to the pation, one that relies on the instigation responsibilities of local government, for of citizens, is in such tools as the ballot instance, per capita public expenditures at initiative, referenda, and recall elections the local level (column 2 in Table 2). The (see Campbell 2003 and Cabrero 2007). range here is 5.6 in West Africa to 348 These are widespread in North America in Japan. The implications of these ratios and Japan, and though permitted in are clear. A municipal government of many countries of Eurasia, not used. 100,000 in West Africa would have no They are "seeping down" in Europe and more than six professional staff to look Latin America. The LAC region has its after a spending program of 1 million. own innovative uses of participation, in Increased decentralization or increased the form of participatory budgeting. As assistance to African cities or both, imply a the name implies, the practice involves need to improve these ratios. The numbers community and neighborhood groups of qualified personnel per capita, would taking part in semi-formal planning ses- need to move ahead of public expenditure sions to determine the mix and scale of (the denominator) in order to expect capital investment. national governments to deepen decen- tralization. But the data are sketchy. More- Capacity over, time series data are rarely available. Nickson (1995) is a notable exception. The second most important problem after financial shortfalls, (again, except for But the regional reports are clear about the many OECD countries) is the yawning gap discouraging, vicious circle of local employ- in proficiency of administration and man- ees. In several regions, for instance, the agement in local government. The range of Middle East and Africa, there is little career issues covered includes a) the sheer num- prospect for municipal employees. As a bers of qualified staff, b) contracting and result, qualified professionals do not seek management systems, c) the need for positions in local government. One conse- merit based reforms and d) corruption, quence noted in Lebanon, admittedly an where it occurs. extreme case because of the war, is that the average age of municipal workers is 55. In the first place, the majority of regional Another consequence is that governments reports note that local governments are turn to contract workers. Turkey has undermanned and their personnel under reverted to a short term contract system. paid and in many places poorly qualified. Elsewhere, the prospects for rent seeking In purely numerical terms, the reports begin to appear in the system. The percep- from regions frequently cite local public tion is that corruption has increased in China sector workers as a proportion of total and Indonesia, and a survey in the Ukraine CONCLUSION Decentralization and Local Democracy in the World 301 Table 2 Local Government Personnel and Spending in Selected Countries Country Personnel per 1000 population Expenditure/cap/staff (euros) Africa (5)* 3 West 2 North 2 5.6 Eurasia (5) 2.5 Na N. America (US) 43.8 31.6 Canada 28.3 36.4 Europe Na Na Asia-Pacific (4 low income) 6.75 Na Indonesia 12.8 4.84 Malaysia 2.3 67.4 Australia 7.5 36.8 New Zealand 5.5 69.1 Japan 11.1 348.5 LAC 4.9 Na * Uses per capita expenditures from West African Economic and Monetary Union. Source: Compiled by author from Regional reports, Nickson (1995), OECD. established that 60 % of the respondents is not so much the nature of legal frame- had "faced one fact of corruption" in the pre- work, but rather that few governments vious year and in Turkey, the confidence have established a unified system of merit- level is only 5.2 on a scale of 10. based public employment that offers career professional employment and mobility. Different systems of management ­ public law, civil service, and private contract Other hopeful signs of progress include the law ­ can all be made to work. Public law new public administration (NPA) reforms is still the predominant career employment that have begun to influence thinking and structure in Europe. Russia has recently policy in several regions, though according taken this step (Art 86 of its public frame- to the Europe chapter it is "running out of work law of March 2007). Some countries steam." Many countries have launched ini- are in the process of extending the tiatives to improve professional compe- national civil service to local levels (ex: in tence of local public officials or to explore LAC Colombia, Brazil, Costa Rica, alternatives to direct service (such as in- Nicaragua, El Salvador.). It should be creased private provision with local public noted that the civil service is only one supervision), for instance, public transport solution of many. Certification systems are in Europe, the US, and Latin America and beginning to appear in Mexico and Thai- the swapping of national and local employ- land. In the US, certification is managed ees, as in Republic of Korea, Germany, and by professional associations of municipal Japan, so that national officials might see employees, not by government. The issue the world from the shoes of local officials. CONCLUSION 302 Decentralization and Local Democracy in the World Only a small handful of countries in the more in population. More attention needs south have framed a long term strategy to to be paid to the growth in the number of build capacity at the local level. These cir- large cities ­ those of a million or more in cumstances leave local governments weak population. Cities in this size-class num- and provide a convenient justification for bered around 200 in the latter part of the nations to hold position in the stalemated 20th century. They will reach more than tug of war. 500 by 2015 (Table 3). These are all met- ropolitan cities in the sense that they are either of great economic importance III. Metropolitan Governments (Douala, Cameroon) in their countries; or are centers of cultural heritage or reli- Cities that are comprised of more than one gious tradition; or because they are local governmental unit are of special con- national capitals (Rabat), or all of these cern to decentralization and democracy. things. Many cities have special regimes Virtually every regional report, in addition (Abuja), but not a metropolitan govern- to the dedicated chapter on metropolitan ment. Virtually all cities in this group are governance, calls attention to the special comprised of more than one municipality, problems of large, multi-jurisdictional ci- and often involve many units of local ties. National strategies and actions are government. Only about a quarter of hobbled by the lack of understanding metro cities are in advanced economies. about feasible approaches to horizontal cooperation among governments in large Emerging Features of Metro Cities: cities. The changing global environment, Flatter, More Fragmented, coupled with rapid city growth, have often In Competition made institutional arrangements obsolete soon after they are promulgated. Three features about growing metropoli- tan areas add new challenges to decen- Definition: Numbers and Growth tralized governance and democratic choice- making. First, metro cities are spreading Much attention has been paid to the grow- out. Angel et al (2005) have recently ing urban population, and to the peak reported that average densities are falling cities in the demographic pyramid ­the in cities around the globe, and particularly so-called mega-cities of 10 million or in the developing regions. Angel's data are Table 3 Cities by Population Size, 2015 Size range World total Less developed More developed 10 M > 21 17 4 5-10 M 37 31 6 1-5 M 496 378 118 0.5-1 M 507 400 107 Total >500.000 1.061 826 235 Source: National Research Council 2003. CONCLUSION Decentralization and Local Democracy in the World 303 drawn from side-by-side comparisons of A third feature of metropolitan centers is 1990 and 2000 satellite images of a repre- that they have entered a more competitive sentative sample of 120 cities. His team cal- environment. Liberalization of trade leaves culated that average density decrease is a cities much more exposed to outside com- direct function of spreading city perimeters. petition because the elimination of protec- These observations are corroborated by the tionist trade regimes no longer shields city chapter on metropolitan governance and by industries from competitors. Also, the data from East Asia (e.g. Webster 2003, increasing velocity of international transac- Laquian 2005). tions ­ in trade, exchange of capital, and investment ­ means that metropolitan Second, as settlements move beyond cities must move quickly to retain indus- established administrative and jurisdictional tries as well as to attract new ones. boundaries, they stretch the customary de- Beaverstock et al (1999) have developed finitions of city limits and often lead to new indicators which measure the growing ex- municipalities, contributing to a fragmenta- tent to which metropolitan centers are con- tion of the metro area. The Africa report nected to global places of doing business. provides a comprehensive illustration of the large number of municipal jurisdictions in Policy Challenges Africa's major cities. A well-known example of this spreading urban region is the The policy challenges for cities spanning Boston-Washington corridor, a megalopoli- more than one jurisdiction or sprawling tan region with a population of 50 million, into outlying regions fall into three familiar which extends more than 600 km, far areas: beyond the prospective planning compe- tence of any of the more than 50 metropol- 1) substantive issues of growth, poverty, itan areas in the region. and environment; 2) institutional issues of powers, organiza- The significance of spreading urban re- tion, and finance; gions is not just the growing territorial 3) issues of democratic representation. expansion, but also the increasing social distance implied in these developments. City regions have always been the centers Though many low income populations still of national GDP. For example, the cities of settle in and around the urban core of Rio and Sao Paulo in Brazil accounted for metro cities, increasingly, low income set- around 40 percent of the nation's US$800 tlements take up residence on low-cost billion dollar economy in the early 2000s. land where property values are sup- This made the economies of those two pressed because of distance or due to cities approximately equal in size to the clouded title, poor conditions of slope or economic importance of all five Andean flood. At the same time, wealthy settle- countries, combined. And although cities in ments spring up in nearby places, formed decentralized regimes all around the world as self-contained enclaves protected by are handling much more public spending, security walls. Both the poor and emerg- few nations have found the solutions and ing middle classes require services of tools to manage infrastructure and serv- health, education, water, and roads out- ices in metro cities. side the established perimeters of the city. These settlement patterns translate Handling spillovers, both positive and neg- into fragmented political units and unco- ative, is a defining feature of metropolitan ordinated actions. Metro cities increase areas. Smaller cities or units of govern- the importance of inter-jurisdictional ment cannot generate the economies of coordination in planning, infrastructure scale that are typical of production in met- investment, and services delivery. ropolitan cities. On the other side of the CONCLUSION 304 Decentralization and Local Democracy in the World coin, major cities generate negative and Peru. Cooperative regionalism might spillovers in pollution and congestion. The describe the problem-solving approach and challenge is made sharper by the need to give-and-take arrangements for large incorporate large regional hinterlands. regions in Europe and the ad hoc intergov- ernmental agreements in the US, like Seat- Few organizational models seem to hold tle's King County. An example of flexible up under the pressures of changing eco- arrangements is the growing use of "conve- nomic and political circumstances. Virtu- nios" (agreements) in Brazil, having grown ally all the European countries are from a handful in the 1990s to hundreds engaged in the question of metropolitan today (Spink 2005), or the mancomu- organization. Turkey has addressed the nidades (associated municipalities). problem directly with reforms that link municipal, metropolitan and national tiers in planning and functions and the direct IV. Role of Associations election of a metropolitan mayor. Russian and some former Soviet states have given Virtually every region reports a flowering capital cities special legal or financial sta- of regional and sometimes professional tus, as is the case with many capitals, associations involving local governments. particularly special districts, for instance, In Latin America, 28 associations are Brasilia, Canberra, and Abuja (Nigeria). listed, the oldest (in Ecuador) dating from These enjoy special spending or planning 1940, but 16 having been formed since status, often linked directly to central 1990. Further, many regions report a par- government budgets. Cities in Europe, allel growth of associations of local govern- Canada, the US, and Republic of Korea ment professionals, for instance, of ma- have all undergone a variety of configura- yors, of finance officials and engineers. For tions with mixed success. Many of the these groups, the most common denomi- cities ­ London, Montreal, and Toronto, nators functionally are: for example ­ have reversed field, going from regional councils or area-wide go- 1) representing interests of local govern- vernments to facilitate planning and ments in national policy; investment of large scale infrastructure, 2) advocating for local governments; back to small governance units, and back 3) building capacity to strengthen local again to larger areas in a quest to capture governments. a wider tax base. In the US, the policy battle has been over whether there is an They also create a platform for exchange economic payoff to cities with regional of views and experience about policy and authorities (Nelson and Foster 1999). practice. Very few countries do not have associations, but some, for instance in Recent Trends Africa, have very limited resources. The chapter on metropolitan governance At the apex of national and regional group- points out that recent trends are toward ings is the Union of Cities and Local Go- cooperative pragmatism at the regional vernments (UCLG), formed from the World level. Governments are recognizing that no Federation of United Cities and the Inter- normative solution will fit the rapidly chang- national Union of Local Authorities and ing political and economic circumstances of Metropolis. UCLG came into being officially the globalizing world, and that metropolitan in 2004 and counts on various regional governance needs to start with solutions for affiliates (known as sections), a network of basic problems and have degrees of flexibil- regional associations which is growing in ity as it moves to more complex arrange- numbers and strength. For instance, in ments, as they have in Republic of Korea Africa, the United Cities and Local Govern- CONCLUSION Decentralization and Local Democracy in the World 305 ments of Africa, a Pan-African local gov- ability of urban growth following Local ernment organization, arose from three Agenda 21 and the Aalborg Charter of local government organizations previously 1994, that addresses climate change divided along linguistic lines. The founding agendas and action plans. Scores of Euro- congress in 2005 marked a starting point pean cities have developed detailed plans for a unified African municipal movement. to achieve a smaller "carbon footprint," that is, more sustainable settlements. In National associations have had mixed suc- the US, mayors are joining a coalition to cess in mobilizing political movement to achieve or surpass Kyoto protocol tar- solve the many problems faced by local gets. More than 500 US mayors have government. A combination of approaches signed a climate protection agreement. has been tried and needs deepening; they include focused educational activities on se- Recent evidence reported by Angel et al lected topics for local and national go- (2005) shows a trend towards decreased vernments to assist national associations to density in cities, signalling an alarming do their job, documentation of good prac- move in a direction away from sustain- tice approaches and techniques, and a sys- able urban living. Brazil and China have tem of learning and information exchange begun to focus on urban remedies to the between and among local governments problems of rapid conversion of land into across nations and regions. the urban fabric. Brazil has recently enacted legislation requiring local govern- ments to meet a higher standard in land- V. Global Challenges use planning and has created land-swap- ping tools to do so. New evidence is coming to light about the impact of decentralization on the Mil- As for the MDGs, local governments have lennium Development Goals (MDGs) and an important role to play in managing related issues. Besides poverty, gender, growth for health and safety. Effective health, technology and culture, the MDGs action in these spheres would strengthen have brought out the importance of envi- the rationale for governments to mobilize ronmentally sustainable development. But lower tiers to address these issues. WHO climate change, particularly the production has recently signaled the importance of of greenhouse gasses, moves this issue to the social determinants of health, pointing a much higher and more urgent plane. particularly to issues of safety, violence, Similarly, some infectious and communica- and prevention of at risk buildings in urban ble diseases threaten to become global settings. WHO's contribution adds to the problems. already large body of work on local level action to address communicable diseases Local governments have a front line po- like HIV/AIDs, malaria and tuberculosis sition in the battle against poverty, (Kjellstrom, et al 2007). In health and cli- through social inclusion, access to basic mate change, local governments have a services, and participation. But environ- critical role to play. mental issues are increasingly at the top of the agenda: fighting greenhouse On other MDG issues, gender, culture, and gasses, for instance, land use and trans- technology, local governments are again portation, building standards, density on the front line. More than a few countries controls, solid waste recycling, and many ­ Africa, Middle East, Asia-Pacific are other aspects of urban growth that fre- notable examples among many ­ speak of quently fall under local government juris- quotas to involve woman in local govern- diction. Hundreds of cities have taken ment. Special status is accorded to women action to improve environmental sustain- in Africa; 30 to 40 % of council seats are CONCLUSION 306 Decentralization and Local Democracy in the World held by women in Eurasia, and India has associations to disseminate this Report set aside 30 % of local government and to encourage the implementation of elected positions for women and sched- the Guidelines both at national levels uled castes. Cultural issues, in heritage, and among international and regional buildings, and inter-cultural dialog, are organizations, e.g. African Union areas where cities have shown promise through the African Conference on and have great potential, for example in Decentralization and Local Develop- city to city exchanges, in cultural under- ment (CADDEL), the Organization of standing, and in informal alliances around American States (OAS) and its Inter- issues of sport and festivals. New informa- American High Level Network on De- tion technology holds great promise for centralization (RIAD). local governments in a variety of fields ­ management, information for citizens, and · Strengthening policy-making capacities education to name a few. In all of these of local government. In effect, UCLG, areas, the agenda is wide and promising. through the Global Observatory on Local Democracy and Decentralization (GOLD), should develop indicators, rec- VI. Next Steps ognized by national and international institutions, to monitor processes of In this final conclusion we have attempted decentralization and the implementa- to summarize the main points and findings tion of the Guidelines; and contribute to of the World Report, while also introducing local capacity for policy dialog vis-à-vis new elements and insights that may national governments and international enhance reflection. Quite possibly, the organizations. These indicators should study does not always provide precise, be used to shape and inform local conclusive answers to the issues and ques- development policies and national tions raised in the introduction of the strategies for poverty reduction. Report regarding the principles of local self-government and subsidiarity. · Enhancing local finance systems. Local access to adequate funding is key to The discussion remains open. Only development. In view of the fiscal through the sustained practice of running weaknesses observed at local level, local governments and continued interac- UCLG should continue to promote pro- tion with their citizens and other levels of posals and initiatives to strengthen government will concrete solutions be local finances and to draw up plans, in found. consultation with governments and re- gional and international financial institu- Therefore, the Report essentially con- tions, for new national systems in order cludes with a call for initiatives that to keep pace with urban explosion, grow- develop and deepen local democracy. In ing demands for basic services and effect, the objective should be to apply mounting environmental challenges. these core principles of local self-govern- ment, subsidiarity and participation to the This list of initiatives could, without a praxis, particularly by: doubt, be extended further to include equally as important initiatives such as · Underpinning policies favorable to local government capacity building, decentralization. The Guidelines on De- upgrading service provision and urban pol- centralization approved by UN Habi- icy for sustainable development. tat are important instruments for advancing in this direction. It is neces- Local governments have an integral role to sary for UCLG and local government play in the international development CONCLUSION Decentralization and Local Democracy in the World 307 agenda not only to articulate their own against climate change will continue to needs and have them met, but also to play guide these actions. a role in reaching the MDGs and fighting climate change. The sustained efforts of Quite plainly, change and transformation local governments to integrate their needs cannot be brought about without the direct in the international development agenda involvement and determination of local go- for the fulfillment of the MDGs and fight vernments around the world. POSTFACE 308 Decentralization and Local Democracy in the World POSTFACE Decentralization and Local Democracy in the World 309 POSTFACE Essay on the clarification of some key concepts and methodical problems Gérard Marcou1 The World Report offers, for the first time, dependent on the importance of the the possibility of clarifying the meaning of social structures. The role of local de- words used to address the term "local". Via mocracy in decentralization depends on the different situations and developments the state's political system. The scope of analyzed, the words often seem closely decentralization depends on the political related but not accurately synonymous. In weight and human and financial addition, the choice of linguistic equiva- resources available to local authorities. lents when translating may involve Decentralization does not exist out- nuances of meaning or presuppose differ- side the state but it ceases to exist ences which, in fact, are merely differ- even within where local authorities ences in terminology. The interest of the are no more than the executors of World Report is that it puts key notions policies determined by higher into context by comparing political and authorities. These are the extreme legal discourse from many countries on all positions that limit the space of local self- continents. The definitions arrived at could government; this is the space within then acquire legitimacy from the fact that which the equilibrium of decentralization they are not self-centered. The conver- must be created in each country depend- gences we have found are not alien to the ing on the conditions2. socio-political reality of each of the coun- tries concerned, even though mimetic The World Report refers explicitly to two effects may still exist, and at times arise notions: decentralization and local democ- from prescriptions imposed by interna- racy. These two terms should be clarified tional organizations. These convergences together with their status in the political and can be considered as positive effects of legal systems of states. A distinction should 1. The text below is a globalization. also be made between them and similar or part of the synthesis correlated notions. This clarification must be chapter submitted However, convergence at the level of contextual and comparative, i.e. based as by the author to ideas does not necessarily imply that the much as possible on the accepted concepts UCLG under the same occurs at institutional or practical used by states in the various regions of the title: levels. On the contrary, factors of differ- world, depending on their history and insti- "Decentralization entiation remain, resulting from very tutions. But at the same time, these notions and local democracy diverse socio-political and economic real- are part of global debates fostered by inter- at the age of ities, which should not be overlooked. national organizations and a number of globalization". 2. In what follows, the The very notion of "local" varies consid- states, contributing to the convergence of information quoted erably from one country and one conti- ideas under discussion by providing terms of comes from nent to another and with it varies the common reference. chapters in the definition of the territories constituting World Report, the framework of local self-government, Firstly, a distinction can be made between unless other sources and the concept of local-state relations. three separate semantic fields: decentral- are indicated by The sociology of local institutions is ization, self-governance and democracy. notes. POSTFACE 310 Decentralization and Local Democracy in the World The first of these three terms refers to The report then distinguishes four types of relations between the various levels of decentralization: administrative decentral- power, the second to the status of the ization, in which local authorities are authorities and the third to the way in accountable to higher authorities; political which power is exercised. We will not decentralization, in which local authorities address the expressions of these semantic are theoretically independent of the state, fields relating to federalism or to regional invested with powers and elected; budget- autonomies. The comparison between ary decentralization, which refers to the these three fields shows a convergence at transfer of the resources necessary for the the level of political ideas and legal exercise of the transferred powers and notions; even though some major states responsibilities; and lastly, divestment or have remained outside this tendency. market decentralization, which entails a transfer of functions to the private sector I. Decentralization (companies, NGOs...), including planning and administration, previously held by The notion of decentralization is under- public institutions. stood today in very different ways depend- ing on the author and institution, which However, the argument slips from decen- leads to misunderstanding and confu- tralization to governance. We recognize sion. Sometimes, overly broad defini- that improved governance might indeed tions of decentralization become con- call for the involvement of private actors, fused with governance, a notion which in but this applies to all levels of government itself is already not very precise. This is and not just to relations between local the case in a report published by the powers and higher authorities. This idea is UNDP on decentralized governance à also represented in a recent book with propos the services which ought to be contributions from various United Nations provided to poor populations: "Concep- experts. Globalization would necessitate tually, decentralization relates to the an enlarged vision of decentralization roles of, and the relations between, cen- within the framework of the new concept tral and sub-national institutions, of governance. According to these authors, whether they are public, private or civic. decentralization cannot be devised any Improved governance will require not longer as the devolution of powers within only strengthened central and local gov- government, and rather embraces ernments but also the involvement of resource and power sharing in policy mak- other actors from civil society organiza- ing in society as a whole. The enlarged tions and the private sector in partner- concept of "governance decentralization" ships with government at all levels"3. suggests a new decentralization category, According to this definition, the relations in addition to the traditional ones: "eco- between the state or local government nomic decentralization", including "market and private companies or NGOs are part liberalization, deregulation, privatization of of the problem concerning decentraliza- public enterprises and public-private part- tion. nerships"4. 3. Work, R. (2002), The Role of participation and partnership in decentralized governance: a brief synthesis of policy lessons and recommendations of nine countries on service delivery for the poor, UNDP, New York, p.3. 4. G. Shabbir Cheema / Dennis A. Rondinelli (2007), "From government decentralization to decentralized governance", p.6 in: G. Shabbir Cheema / Dennis A. Rondinelli (eds), Decentralizing governance, Brookings Institution Press / Ash Institute for Democratic Governance and Innovation. POSTFACE Decentralization and Local Democracy in the World 311 This approach is not really all that new. It blic powers, the decisions of economic comes from a critique of the "Welfare agents are not subject to democratic proce- 5. See amongst basic state", developed in particular in the dures. In addition, the fact of turning to the texts on the subject: 1980s. Such lines of thinking advocated market to produce or supply a good or a Tiebout, C.M. market competition as an alternative for service does not mean that the public (1956), "A pure the provision of services that the public authority, local or otherwise, is no longer theory of local powers could no longer provide, as well as competent. If the responsibility of the pub- expenditure", Journal decentralization so that fiscal competition lic authority is to ensure that a good or a of Political Economy, vol.64, p.416; would exercise pressure to reduce public service is offered to the population and it is Buchanan, J.M. / expenditure and so better satisfy the col- allowed by law to chose the method or form Tullock, G. (1962), lective preferences of the electorate of provision, it can then assess whether it The calculus of through competition between local author- is preferable to set up a public organization, consent: Logical ities5. Hence, a distinction could be made to conclude public procurement contracts or foundations of between "economic", "administrative" and to proceed to delegate the public service to constitutional liberty, "political" decentralization. "Economic decen- the private. However, the public authority University of tralization" refers to economic decisions remains responsible in the eyes of the law Michigan Press, Ann (decentralized when they result diffusely and the citizens for the provision of the Harbor. from the play of market forces, centralized service under the conditions it has defined. 6. Wolman, H. (1990), if they are decisions made by the govern- The case would be different, of course, if "Decentralization: ment); "administrative decentralization" privatization is decided on by the state and What it is and why we should care", refers instead to the degree of dispersion the consequences affect the local authori- p.29-42 in: Bennett, or concentration of public decisions; and, ties, or if the law obliged them to resort to R.J. (ed), finally, "political decentralization" which the private sector, even when the local Decentralization, refers to the authorities with the capacity authority continues to exercise powers of local governments to make political choices6. control and organization. It is then paradox- and markets. ical to use the expression "decentralization" Towards a post- In this framework, it has been possible to to characterize measures which result in a welfare agenda, propose a classification of all systems of reduction of the role and responsibilities of Oxford, Clarendon. decentralization based on two dimensions: the local authorities. 7. Bennett, R.J. (1990), the method of allocating resources (pure "Decentralization, market and state controlled economies repre- This is why it is preferable to reserve intergovernmental sent the two extremes) and the levels of the notion of decentralization for the relations and markets: towards a political and administrative organization to relations between the public powers, post-welfare which the resources are allocated (central, some of which are placed under the agenda?", pp.1-26 local or intermediate). Obviously, all real control of others, and not for the rela- in: Bennett, R.J. systems are mixed systems but they are tions between the public powers and (ed), op. cit.; situated somewhere between four extreme the economy or society in general. This Bennett, R.J. (1994), theoretical models as follows: the central- is not to ignore, for all that, the impor- "An overview of ized public model, the centralized market tance of relations with the economy, and developments in model, the decentralized public model and they may be addressed in an analysis of decentralization", the decentralized market model7. These governance, but they do not come under pp.11-37 in: models make it possible to assess the what is normally called decentralization. Bennett, R.J. (ed.), characteristics of real systems and to com- Local government pare their relative positions. Even within these boundaries, the notion and market decentralization. of decentralization is still likely to be Experiences in Despite its heuristic value, this global the- understood in two different ways: a broad industrialized, ory of decentralization may be criticized for meaning, which relates to the public econ- developing and leading to a degree of confusion. Firstly, the omy or to the sociology of organizations, former Eastern Bloc relations between the public powers and the or a narrow meaning, of a legal and politi- countries, United relations between the public powers and the cal nature. The former has become the Nations University economy are not the same; unlike the pu- general or commonplace meaning; the lat- Press. POSTFACE 312 Decentralization and Local Democracy in the World ter, more exact, is the only one, as we will authorities. But it still signifies, and this is see, which has a normative scope. Decen- the basis of its unity, an institutional and tralization should also be distinguished political differentiation between the state from related notions: devolution, originally and the local authorities, and the legiti- an English concept, and deconcentration, macy of representation at local level of which is of French origin and the notion of public interests distinct from those for delegation. which the state is responsible. In its broadest sense, decentralization From decentralization in its narrowest expresses a quality of the relations between sense, we must compare and distinguish levels of authority one of which is under the the English notion of devolution, which one control of the other. We say that these rela- hesitates to translate as "dévolution" in tions are more or less decentralized, French. It is a relatively imprecise notion depending on whether the inferior power which appeared at the end of the 19th cen- benefits more or less from freedom of tury as an attempt to respond to the Irish action in the exercise of its attributions independence movement through an inter- under the control of the superior power. The nal regime of extensive self-government notion of decentralization can thus apply (Home Rule). Devolution corresponds to both to the relations between the federal the transfer of wide-ranging powers to a power and the member states (for example political assembly for the management of Austrian or Australian types of federalism internal affairs. The word was used to des- are said to be more centralized than those ignate the projects in the 70s and the in the USA or Canada) and to the relations reforms of 1998, which transferred impor- between the state and local authorities in a tant powers and means to regional bodies. unitary state, or between the federated But it is also used, today, in a broader entities and the local authorities which they sense, particularly outside the UK, to des- comprise, or even to the internal relations ignate transfers of power to local or in a company or a group of companies con- regional communities. sidered as an organization. The meaning of the word devolution thus In the narrow sense, decentralization seems akin to a distinction commonly ma- means that local authorities are estab- de today between political decentralization lished by the law, have a legal personality and administrative decentralization. But and are administered by bodies through the criterion of the distinction is far from which they exercise, with a degree of lib- clear. In the typology of decentralization erty, the powers and responsibilities they proposed in the UNDP report referred to obtain from the law under the control of above, administrative decentralization is the state. This notion was first asserted in characterized by the fact that the local France. According to an English variant authorities are accountable to the higher found in many countries influenced by authority. This corresponds to what one British tradition, the law confers the could call de-concentration or delegation legal personality and powers not on the (depending on the cases - cf. infra). This communities but on the bodies; since the control relation (accountability) with 90s, it is this concept which has been fol- the higher authority does not exist in lowed, with certain differences, by Russian political decentralization nor in devo- legislation and that of other former Soviet lution, which implies a total transfer Union countries. Decentralization under- of powers and responsibilities, deci- stood in this way, depending on the variant, sion-making power and resources, has resulted in quite different regimes including the power to procure from the point of view of local institutions resources8. However, devolution does not 8. Op. cit. p.4. and the self-governance left to local necessarily imply that the local authority POSTFACE Decentralization and Local Democracy in the World 313 results from election, just as decentraliza- elections have been held over the last few tion also does not necessarily entail the years with the exception of the United election of local authorities. Arab Emirates. If the classical idea of decentralization accepts the auton- However, the distinction between political omy of local authorities in the frame- and administrative decentralization is work of the law, the modern view of more currently based on other criteria. A decentralization is today inseparable few examples follow. Political decentraliza- from the democratic norm, and no one tion corresponds to the exercise of political disputes this even if its transposition and power, as in the case of federated govern- implementation are often criticised. ments in the framework of a federal state; whereas administrative decentralization As soon as universal suffrage applies for only consists of the institutionalization of the designation of local authorities, it the legal entities responsible for managing becomes inevitable that decentralization local interests9. It is therefore the exercise will take on a political dimension, even of legislative power by sub-national terri- though, in certain countries, political par- torial units which is considered as the ties are not allowed to participate in local expression of political decentralization, in elections, and even though the official contrast with the classical case of the uni- vocabulary continues to speak of "adminis- tary state in which the unity of legislation trative" decentralization, or "administra- is the expression of the unity of power10. tive" elections à propos local elections. This Or again, political decentralization presup- is so, given that elections imply a form of poses the dispersion of political decision- responsibility of those elected vis-à-vis making power, i.e., a degree of freedom of their electorate even if the higher authority action as to the determination of policies, exercises a form of supervision. This is the the capacity to mobilize resources and the meaning (the direction) of accountability freedom to use them11. But some defini- which makes the difference, as shown in tions of administrative decentralization do the UNDP report: no longer towards the not differ greatly from this latter concept: state but towards the electorate. 9. Bourjol, M. (1975), according to Maurice Hauriou, it is the need La réforme for political freedom rather than adminis- In this case, devolution is not distinguished municipale, Paris, trative needs, which justifies decentraliza- from decentralization through its political Berger-Levrault, pp.56-58. tion12; according to Charles Eisenmann, dimension but by its possible scope. In 10. Aja, E. (1999), El administrative decentralization "consists of point of fact, the idea of devolution has no Estado autonómico. giving to locally competent authorities limit on the transfers which may carried Federalismo y powers of action, therefore firstly of deci- out, other than the point at which the hechos sion-making, independent of the central transfers would mean independence; on diferenciales, authorities"13. the contrary, the idea of decentralization is Madrid, Alianza inseparable from the idea of the unity of Editorial, pp.23 et But today, over and above these theoreti- power. Decentralized entities administer suiv. cal approaches, another criterion must be themselves without ceasing to be an inte- 11. Wolman, H., op. cit. added, that of the election of local author- grated part of the state and without the pp.29-30. ities. Although, from a theoretical point of state conceding to them part of its consti- 12. Hauriou, M. (1919), view, the notions of decentralization and tutional functions. Extended to the transfer Précis de droit administratif, Paris, devolution do not necessarily imply the of legislative powers, political decentraliza- Sirey, preface. election of local authorities, the fact is that tion corresponds in fact to a different 13. Eisenmann, Ch. today territorial decentralization is insepa- notion of decentralization in its strictest (1982), Cours de rable from the democratic legitimacy of sense. This results in the fact that, apart droit administratif, local authorities, and in all countries the from this hypothesis, devolution and Paris, LGDJ, tome 1 institution of locally elected councils is the decentralization may be considered as syn- p.278 (cours de rule. Even in the Arab Gulf states, local onymous particularly for local authorities at 1966-1967). POSTFACE 314 Decentralization and Local Democracy in the World municipal level for which there is never a administrative authorities, and exer- transfer of legislative powers. cising, in the framework of the law, their own powers and responsibilities On the other hand, a clear distinction must for which they have a degree of self- be made between deconcentration and government, under the control of the decentralization and the former must not be state. As understood in this way, assimilated to a restrictive application of the decentralization in its modern mean- idea of decentralization as is proposed within ing is inseparable from the idea of a broad concept of decentralization. Decon- local self-government and the demo- centration is originally a French notion which cratic principle. But the volume of applies to the relations between the central responsibilities exercised is not sufficient administration and their local-level offices to assess the level of decentralization in a that depend on the delegation of powers to given country; that depends also on the the latter. Deconcentration is the oppo- regime under which the responsibilities are site of decentralization in that it governs to be found and the control effectively the relations within an administrative exercised by the state. hierarchy, whereas decentralization ex- cludes any hierarchical relations In its broadest sense, decentralization between the state and local authorities. exists in almost all countries although it Deconcentration comprises two elements: has very different characteristics. But strictly defined, decentralization is lacking i) the existence of territorially competent in very many countries. Hence, when arti- services within the state administration; cle 96 of the constitution of the China states that "local congresses of the people ii) delegation of powers to these services. at different levels are the organs of the state's power", this is a form of decentral- But the term delegation may also be used ization in its broadest, and not strictest, to designate an intermediate situation: sense. This was the concept in the Soviet state powers and responsibilities are dele- Union, abandoned today under article 12 gated to a decentralized authority (i.e., of the constitution of the Russian Federa- resulting from an election and not from tion. But some states, formerly part of the nomination by a higher authority) and are Soviet Union, still adhere more or less exercised on behalf of the state and for explicitly to this concept (in general the which the decentralized authority is states of Central Asia and Belarus). In accountable to the state. This situation is Cuba, although assemblies of people's most often designated by the expression: power are characterized in the constitution "delegated powers and responsibilities". as the "higher local bodies of state power", Depending on the case, it may be that it is however recognized that they fulfil elective legitimacy weakens the control of specific functions other than the assistance the higher authority or, on the contrary, they provide in realizing the ultimate goals that the weight of the delegated powers of the state (art.102 and 103). Other polit- and responsibilities weakens decentraliza- ical concepts may also lead to principles tion because of the control exercised by excluding decentralization of the local the higher authority. administration. This is the case in Saudi Arabia, in Oman and in Qatar; in other These distinctions lead to a preference for Arab countries and in Islamic Republic of a strict definition of decentralization which Iran some moves have been made towards marks the difference from related notions. decentralization in recent laws and consti- Decentralization is thus characterized tutions. Yet the Iranian constitution, which by the existence of locally elected sets up locally elected councils, subjects authorities, distinct from the state's them to the principles of the Islamic POSTFACE Decentralization and Local Democracy in the World 315 regime and envisages their "subordina- the legal meaning of the word and also a tion" to central government authority few countries which attribute a political (article 100)14. Despite this, there is a status to municipal self-government. tendency towards the diffusion of the model of decentralization and the recog- Local self-government is expressed in nition of a sphere of responsibility specific sometimes differently coined legal to local authorities, at least regarding the notions but which are, in general, similar principles, even in countries which seem in content. In certain European coun- far removed from these principles. tries, reference is formally made to the notion of "autonomy" in the constitutions II. Self-Government (Autonomy) (Italy: art.5; Spain: art.140; Portugal: art.6; Romania: art.120; Greece: Autonomy literally means the power to set art.102.2; "administrative autonomy"). for oneself the rules by which one is gov- In all the other European countries, the erned. However, this notion may also be term used corresponds literally to the understood in at least two different ways. German expression Selbstverwaltung In the sense of political autonomy, it is a (Fundamental Law: art.28.2), defined as demand for sovereignty which stops at "the right to govern, under one's own the limit of independence, from which it responsibility, all the affairs of the local is distinct. Understood as administrative authority", which corresponds to the self-government, it expresses the possi- notion of "libre administration" in the bility for the local authority to govern its French constitution (art.72), and the own affairs and those which the law English notion of self-government15. This entrusts to it. It is in this second sense latter expression could however be dis- that it is generally understood as local tinguished insofar as its material content self-government. The regional autonomy derives only from the provisions of the statutes in different European countries law, but this limitation is receding both in (e.g. in Spain or in the UK) and on other the United Kingdom and in the USA and continents (for example the autonomy of Australia (constitution of certain feder- Karakalpakstan in Uzbekistan, or that of ated states in the latter two countries), Aceh in Indonesia) come under the first and by the link with a degree of freedom meaning. The French constitution today of organization at local level (home rule). 14. Jalali, M. (2005), "Iran: une accepts both meanings but applies them décentralisation en to entities of a different nature: the first This notion of "self-government" ("libre trompe l'oeil? Les to "overseas countries" (New Caledonia, administration" in French) is to be found fondements French Polynesia) (art.74), and the sec- in the 1993 Russian constitution (mest- essentiels de la ond to territorial communities (art.72). noe samoupravlenie, art.130 to 133), décentralisation en The European Charter for Local Self-gov- including the freedom of organization in Iran", Revue ernment as well as the "Guidelines" law 131/2003), the Ukrainian constitu- iranienne de Droit recently adopted by the Governing Coun- tion of 1996 (mitzeve samovriaduvania, constitutionnel, cil of UN Habitat both refer to the second art.140) or the Polish constitution of summer 2005, n°4, meaning. This self-government also has 1997 (samorzad terytorialny: art.163 et pp.74-86. a political dimension but it results from seq.). In Latin America, the word "auton- 15. In this sense: elections not from the statute of the local omy" is usually preferred, both in unitary Breuillard, M. (2000), authorities. states (Colombia: art.287) and in federal L'administration states (Argentina: art.123, ensuring locale en Grande- Local self-government, as under- municipal autonomy is a duty of the Bretagne, entre stood above, is more and more provincial constitutions; see for example centralisation et widely recognized on the different that of La Rioja: art.154). In Asia, coun- régionalisation, continents. The exceptions are states tries which were under British colonial L'Harmattan, coll. « which do not refer to decentralization in rule have retained the British concept of GRALE » Paris. POSTFACE 316 Decentralization and Local Democracy in the World local government and of local self-gov- municipality which makes it a component ernment, including the restoration of tra- of the state or the framework of an ex- ditional methods of local organization pression of sovereignty. Sweden is the (not only Australia and New Zealand, but only European country whose constitu- also India, Pakistan, Malaysia) but other tion declares that "self-management of countries refer rather to the wording local communities" contributes to the "local autonomy" (Japan, Indonesia, realization of "national sovereignty" Republic of Korea, Philippines). (1:1). The constitution of the Ukraine al- so states that the people's sovereignty is One can see however that these differ- exercised by the organs of power of the ences in terminology and sometimes con- state and by the bodies of local self-gov- ceptualization have no impact on the real ernment (art.5), but this formula recalls content of "autonomy" or "self-govern- the former adherence of local bodies to ment". There is nothing that allows us to the state power. In Brazil, the 1988 con- assert that the reference to "local auton- stitution, in principle, confers on the omy" corresponds to a degree of decen- municipalities (municipio) political self- tralization greater than the reference to government: the municipios, as with fed- the principle of "self-government", if one erated states, are part of the compo- compares institutions, powers and nents whose "indissoluble unity" forms responsibilities. Municipalities in Germany the Federal Republic of Brazil (art.1), and or France do not benefit from less exten- the federal constitution defines the bases sive decentralization than municipalities of their organization and their powers in Italy or Portugal; decentralization is no and responsibilities (art.29 to 31). The more advanced in the Republic of Korea practical scope of this concept seems, than in India. But decentralization is however, limited16. In Indonesia, the in- essential as a reference standard for local troduction of the reference to "auton- government. This standard is being omy" in the laws of 1999 and later laws, developed by the European Charter for corresponds on the other hand to a Local Self-government and the UN Habi- change of concept, with the transfer of tat Guidelines for Decentralization. wide-ranging powers, responsibilities and resources and the direct election of the This general tendency has however a few local executive. nuances. In African countries, the con- cepts which the constitutions and Local self-government is a con- national laws reflect follow those of the stituent element of decentralization. former colonial power. However, this con- The terms "local autonomy", "libre ception has been dominated since inde- administration" and "self-govern- pendence by the wish to ensure the unity ment" do indeed correspond to one of the state, which has upheld a central- and the same notion. It presupposes ized system and an essentially instru- freedom of action and organization 16. Franck Moderne mental vision of decentralization. How- for the local authority in the context (2006), "Le ever, for a number of years, the reforms of the laws; this freedom may be municipio comme undertaken in a certain number of states more or less extensive but this does entité politique dans bring them closer to the general trend by not affect the notion itself. l'organisation giving to decentralization a more sub- territoriale fédérale stantial content of local self-government du Brésil", pp.347- (for example: South Africa, Uganda, III. Democracy 363 in: Mélanges en Zambia, Burkina Faso, Niger, Senegal). l'honneur de Jean- Claude Douence. La The classical notion of decentralization profondeur du droit Lastly, a few countries stand out, con- does not necessarily imply democracy; local, Paris, Dalloz. versely, by the affirmation of a concept of an organization may be decentralized POSTFACE Decentralization and Local Democracy in the World 317 without being based on democratic prin- Ghana, Uganda, Niger, South Africa...). ciples17. Conversely, an organization ba- In certain Middle Eastern countries, the sed on democratic principles may be cen- authority of members of the local aristoc- tralized. racy is influential even though there are elections (UAE, Saudi Arabia and Now, the link between decentralization Bahrain). and democracy has become narrower and more direct, as in the past in Europe, Despite these surviving customs, the ge- the link between parliamentary govern- neral trend is towards the election of ment, arising out of the census system, local government bodies and to the and democracy. Decentralization, development of instituted forms of popu- understood in its strictest sense as a lar participation. Even if the election is method of organization, today im- not disputed, it is considered to be plies democracy. It presupposes the essential for the authority and the legiti- self-government of local authorities macy of the local authorities and one can in the framework of the law, but it is see that legislation tends to introduce a democracy which is the basis for degree of possibility of choice or influ- local self-government. Democracy ence for electors (Vietnam, 2004 local effectively allows citizens to express col- elections; China at village or district lective preferences which direct the exer- committee level). cise of power held by local authorities by law. This has not always been the case: In conclusion, it is obvious that a system property ownership as a requirement for of reference for decentralization is being voting or the recognized authority of the consolidated which includes recognizing traditional elite have in the past consti- local self-government and calls for repre- tuted the basis, or the driving force, for sentative elected institutions and partici- decentralization. patory institutions by which the people may express their collective preferences This has not completely disappeared. On and interests. We should underline that the contrary, in certain countries, the this system of reference is not found institutions give community leaders or everywhere, but it is challenged by any religious chiefs a controlling role in civil other reference system and continues to society and the law sometimes gives spread. 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(eds.), "Cities and Regions in the New Europe," London: Belhaven Press. E C O - A U D I T Environmental Benefits Statement The World Bank is committed to preserv- Saved: ing endangered forests and natural · 32 trees resources. The Office of the Publisher has · 22 million British chosen to print Decentralization and thermal units of Local Democracy in the World on total energy recycled paper with 30 percent post- · 2,817 pounds of consumer waste, in accordance with the net greenhouse recommended standards for paper usage gases set by the Green Press Initiative, a non- · 11,695 gallons of profit program supporting publishers in waste water using fiber that is not sourced from · 1,502 pounds of endangered forests. For more informa- solid waste tion,visitwww.greenpressinitiative.org. Decentralization and local democracy in the world The first Global Observatory on Local Democracy and Decentralization (GOLD) Report is one of the main products of United Cities and Local Governments (UCLG). It constitutes a global reference on decentralization by presenting the contemporary situation of local governments in all regions of the world. The report analyzes local authorities in each continent under three main themes: the evolution of territorial structures; responsibilities and power, management, and finances; and local democracy. An additional chapter is dedicated to the governance of large metropolises, where rapid growth presents major challenges, in particular in the fast-developing countries of the South. This report also offers a comparative overview of the different realities concerning the state of decentralization, and how the basic indispensable mechanisms for local democracy do, or do not exist in some countries. Relationships between the state and local authorities are evolving toward innovative forms of cooperation. In this context, the role of local authorities in the development of global policies is increasingly recognized. The GOLD Report is the first of what will be a triennial publication. UCLG represents and defends the interests of local governments on the world stage, regardless of the size of the communities they serve. Headquartered in Barcelona, the organization's stated mission is: To be the united voice and world advocate of democratic local self-government, promoting its values, objectives and interests, through cooperation between local governments, and within the wider international community. Generalitat de Catalunya ISBN 978-0-8213-7734-5 This publication can be obtained electronically from UCLG or the World Bank: www.cities-localgovernments.org/gold/gold_report.asp publications. worldbank.org/ecommerce SKU 17734