The challenge for the Informal Development Partners Working Group on Local Governance and Decentralisation
Decentralization and participatory local governance have become prominent aspects on the Development Partners (DP) agenda in many developing and transition countries for several reasons:
1. The delivery of crucial services contributing to the achievement of the Millennium Development Goals (MDGs) is not possible without effective and responsive local institutions.
2. Participatory decision-making and accountable public management are crucial for local actors to meet their development goals in the context of Poverty Reduction Strategies (PRS).
3. Participatory local governance reinforces national democratization processes and increases the legitimacy of states.
In spite of its promise, decentralization and local governance involve significant risks, dilemmas and challenges. It creates political winners and losers; requires more complex systems of financial allocation, control, and accountability; and demands more widely distributed management and technical capacities linked to service delivery. All in all, reforms on local development and decentralization have political, institutional, administrative and financial implications and therefore make high demands on intervention strategies.
Local development programmes have very different origins and characteristics. Traditionally they have been influenced by social funds and other multi-sectoral and demand-driven programmes. They aim to increase access among the poor to basic services and thereby contributing to local development and poverty alleviation. These programmes generally include financing -usually in the form of grants- to community groups, civil society organisations and more recently to local governments.
Since a couple of years a consensus has been emerging that in order to ensure sustainable local government structures and service delivery these approaches must be embedded in the decentralisation processes which are on-going in many countries. This involves processes of institutional change and good governance that strengthen the linkages and synergies between communities and democratically legitimised local governments. So that assigns an appropriate role to central government in creating an enabling environment for local development. Thus, it became more and more apparent: for a sustainable local development closely linked to local government it is of utmost importance to look into the national framework for decentralisation. In this context fiscal decentralisation is one of the major issues but also public sector reform in general. This bottom-down perspective in addition to the bottom-up approaches needs further conceptual reflection on the donor side.
DPs supporting local governance and decentralisation are still far away from a consensus about the way forward and the approaches to be followed. This even seems to be true for separate departments within the same institution who look into the matter from very different angles. Another major obstacle for achieving strategy coherence and harmonization is often due to DP specific policies and procedures. As a consequence in many countries fragmentation is the primary common feature of the different donor approaches and therefore the conceptual, methodical and procedural framework for a “local development strategy” needs to be clarified and advanced.
