key concepts background paper-decentralisation

8/3/2019 Key Concepts Background Paper-Decentralisation

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SPRING Key Concepts: Decentralisation

Key Concepts

Decentralisation in Development Planning


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SPRING C. Woiwode 2

SPRING

Key Concepts: Decentralisation in

Development Planning

Backgroundpaper

Contents

1. Conceptualizingdecentralizationwithspecialreferenceto

developmentplanning

2. Example:Berlin deconcentrationasanewleitmotif

3. Avenuesofinterventionandreformfordecentralization

4. Majorconsiderationsaboutdesignandimplementation

5. Keyareas

of

intervention

6. Somelessonslearned

7. ConcludingRemarks


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Conceptualizing decentralization with special reference to development planning

Origin and history of the conceptDecentralization gained popularity within the last three decades, yet it is not a new idea.There is a considerable bias of studies on decentralization since most rationales as to howand why to undertake decentralization are based on normative and empirical studies inindustrialized countries. This is, among other things, due to the course of evolution politicaland economic structures in Europe:

By beginning of 21st century, the majority of the worlds developed countries hadexperienced half a century of steady growth and social stability, which resulted not only fromthe effective functioning of the market economy but also from the strengthening of the state.The growth of the economy and the evolution of the respective roles of the state and marketinstitutions created the conditions for an increasingly more sophisticated developmentapproach. These countries can now count on a multi-level and multi-functional system ofpublic-private relations and high standards of living. In this sense, the revival of thedecentralization concept is a logical outcome in the historical evolution of the role and

nature of the state in these countries (UNDP Human Development Report, Uzbekistan2005).

Naturally, government policies depend to a large extend on the notion of development, whichin turn have an impact on the understanding and practice of development planning. The past50 years of international development have witnessed continuous changes in developmenttheories and approaches, political ideologies, as well as approaches to planning. The tablebelow provides a simplified overview of these changes.


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Table:Congruenceofgovernmentpoliciesandprevalentnotionofdevelopment

(RondinelliandCheema1983,Introduction;CohenandPeterson1999)

Period Governmentpolicies Notionofdevelopment Planningorganisation

1950sto

1960s

Controlover

developmentactivities

inmost

developing

countrieshasbeen

centralizedinnational

government

Centralcontrol

compatiblewithmajor

theoriesofeconomic

development

Capitalintensive

industrializationpolicies

aimedat

maximizing

gains

ingrossnationalproduct

Trickledownofprosperity

modernisation

Centralplanning

introducedinmost

developingcountries

as

meansofproviding

rational&coherent

policies

Centralplanning

prescribedby

internationalaid

agenciestopromote

modernization,social

andpoliticalchange,

generatingemployment,

mobilizingcapital

Late

1960sto

1970s

Interestin

decentralizationa

resultofthefailureof

centralizedcontrol&

management

Reducedemphasison

nationalplanning,

growingawarenessof

needto

devise

administrative

structurethatpermits

regional

decentralization,local

autonomy

Conceptofdevelopment

extendedbeyondjust

economicgrowth

Requiredisa

transformationinsocial,

economicandpolitical

structuresthatenables

poorpeopletohelp

themselves

Basicneedsapproach

Growthwithequity

Newnotionof

developmentrequires

widerparticipationin

economic,socialand

politicalprocesses

Cannotbeeasily

centrallyplanned

Planningthroughdistrict

committees,village

councils

1980sto

1990s

Consolidationof

decentralization

paradigm:structural

adjustmentpolicies

Governanceconcept

consideredanessential

elementfor

development

programmestobe

successfuland

effective

Neoliberalnotionof

development:propagation

offreemarketsystemand

lessstate

Privatizationstrategies

in

a

marketenvironment

Promotionofgrowthof

democraticinstitutionsand

pluralisticcivilsociety

Participationbecomesa

centralconceptto

planningprocesses(PRA,

RRA,etc.)

importanceof

NGOs

and

grassrootorganizations

isrecognised

Partnershipsandmulti

stakeholderinvolvement

integralpartofmost

programmes

(institutionalpluralism)


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Conceptualising decentralization and subordinated dimensions

One of the most cited definitions of decentralization:the transfer of the responsibility for planning, management, and the raising andallocation of resources from the central government and its agencies to fieldunits of government agencies, subordinate units or levels of government, semi-autonomous public authorities or corporations, area-wide, regional or functionalauthorities, or non-governmental private or voluntary organizations (Rondinelli etal. 1989: 58)

Another definition may be:The restructuring of authority so that there is a system of co-responsibilitybetween institutions of governance at the central, regional and local levelsaccording to the principle of subsidiarity. (Work 2003: 8)

Subsidiarity means, in a simplified manner: as low as possible, as high as necessary.Regarding planning, the principle is usually applied as follows: a development plan should be

formulated, whenever possible, at the level for which it is meant. That means, for instance, avillage development plan should be formulated at and by the village authority, a districtdevelopment plan should be formulated at the district, a provincial plan should be formulatedat the province, etc. Only when the respective level organisation is definitely not in a positionto carry out the function, then the immediate nextlevel organisation should come in to assistthe process. That immediate next level organisation comes in as a subsidiaryto the lowerlevel. That means, when the village level authority cannot formulate its plan, the districtcomes in to provide assistance. When the district secretariat cannot formulate a districtdevelopment plan, the provincial administration comes in and assists the district. When theprovince is unable to formulate its integral provincial development plan, national level comesin and assists the province in formulating its plan.

Rationales for introducing or promoting decentralization processes are manifold. One of themost common theoretical rationales for decentralization is to attain allocative efficiency.When it comes to equity and distributional concerns, the opinion on whether it can be donemore effectively by central or decentralized structures is divided. Political rationales arebased on the assumption that good governments are those closer to the people or that byway of decentralization to accommodate pressure for regional autonomy. None of theseassumptions has been empirically proven so far without doubts.

Generally, in the literature three types of decentralization are identified: a) political, b)administrative and c) fiscal, and four major forms of decentralization:

a) Devolution: political decentralization,b) Delegation: redistribution of authority and responsibility to local units of government

or agencies, but main accountability rests with higher level,c) Deconcentration, first step in newly decentralizing government to improve service

delivery,andd) Divestment: functions are transferred to voluntary, private or non-governmental

institutions.

It is important to note that these are theoretical distinctions, which become blurred inpractice, especially as the various forms and types are often implemented simultaneously.Depending on the form of decentralization, there may be various degrees of decentralizingfunctions, the more extensive being devolution, followed by delegation and thendeconcentration, whereas divestment is a sort of externalised decentralization.


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But decentralization takes on another form as well, which is particularly interesting for ourpurpose, that is the spatial dimension. Administrative borders such as federal states,districts, and local governments also define geographical areas of responsibilities, which aredelineated by a legislative framework, and usually describe the jurisdictions of the planningfunction.

Spatial decentralization is a term used by regional planners involved informulating policies and programs that aim at reducing excessive urbanconcentration in a few large cities by promoting regional growth poles that havepotential to become centers of manufacturing and agricultural marketing (Cohenand Peterson 1999: 22-23).

As a result, delegation has been common with regard to special regional or area-specificdevelopment authorities, semi-autonomous organizations such as public utilities, housing

and transport authorities, and urban development corporations. However, in many cases thenumber of authorities and semi-autonomous agencies with a say within a defined planningarea is overwhelmingly large, frequently adding to the confusion of vague responsibilities andunclear roles. Especially in metropolitan regions the fragmentation of stakeholders isincreasingly considered an obstacle to the planning process and implementation of plans.

Another crucial aspect in relation to decentralization is the structure and organization of thestate, usually laid down in a constitution. Often the distinction is being made between unitaryand federal states. Schou and Haug comment:

The difference between a unitary and a federal state is not that one is moredecentralized than the other, but that the former can be decentralized through

legislation whereas the latter is decentralized by constitution. In a federation,certain matters are constitutionally devolved to local units, and the centralgovernment cannot unilaterally revoke decentralized powers, unlike in a unitarystate where the power to recentralize is vested in the central government.Constitutional change affecting responsibilities and rights requires the consent ofboth levels of government. Thus, federations automatically imply a codified andwritten constitution, often accompanied at the federal level by a supreme court.(Schou and Haug 2005: 10)

Example: Berlin - deconcentration as a new leitmotif

The city of Berlin and her surrounding region provide a good case for spatial decentralization.In fact it demonstrates a combination of regional/local planning and administrative reformtools for decentralization.

TYPE

FORM

Political

decentralisation

Administrative

decentralisation

Fiscal

decentralisation

DEVOLUTION DECONCENTRATION DELEGATION

RESOURCE

ALLOCATIONtosub

nationallevels

DIVESTMENT


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After the Wall came down in 1989, the transformation of former east Germany from acentralized state to a federal structure took place. This had fundamental consequences forthe practice of spatial planning organization which had to decentralize within a very shortspan of time. An entirely new legal system had to be introduced, administrative structuresand boundaries had to be redrawn, and professional planning capacities in regional and localgovernments had to be built. West Berlin, having had no hinterland for several decades,needed to be integrated with its new surrounding state of Brandenburg. For this reason anew regional leitmotif was developed to guide the spatial development in the desireddirection: decentralized concentration.

A landmark decision was made already very early in the planning process, namely that thetwo states Berlin and Brandenburg agreed to engage into joint spatial development planning.The elements of this agreement are:

Development should take place decentrally, i.e. not focused on Berlin and theimmediately surrounding area, but over the whole of the planning area;

The leading concept of spatial planning is the long-term aim of: ensuring that livingconditions are similar in all parts of the area; protecting natural working and livingconditions; exploiting the areas natural potential; and concentrated application oflimited public resources;

The basic framework is made up of different centres of decentralized concentration

(see map); In order to support this notion of a spatial leitmotif, the administrative borders of the

districts of Brandenburg state were also redrawn in such a way that they radially


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border Berlin and the outer limits of the Brandenburg state. The underlying idea wasthat all districts will then profit from close vicinity to Berlin and the immediatesuburban area.

Regional development centres are the heart of the planning concept: Six regional development centres play a key role in the spatial planning concept; They are situated at a distance of 60 to 80 kms from Berlin; These centres are far enough from Berlin to develop independently, but near enough

to profit from advantages of the metropolitan region; Improvement of these towns should be a priority matter; These centres would have a double function: a) supporting development in their

catchment areas because of their effects on surrounding areas, and b) beingcompetitive alternatives to Berlin.

This example allows reference to rapidly growing urban regions in developing countries,which are faced with inevitable adjustments in urban regional administration and challengesfor their planning systems. For instance, cities in India like Bangalore or Ahmedabad are

growing rapidly. Currently, in order to accommodate the growth and the consequences,municipal limits are extended, legal restructuration/decentralization takes place throughdelegation to zonal management, and fiscal devolution is envisaged yet still not properly inplace. But at the same time there is also a significant degree of fragmentation of planningauthorities, the overlap of old structures with new ones in the name of decentralization isreason for bewilderment about responsibilities and roles. Clearly, decentralization and thedevolution of powers take time to be implemented. If seriously pursued, it may be a processof decades, since it involves considerable transformations of the organizational andinstitutional environment.

Decentralization and other issues of development

Decentralisation is cross-cutting concept with a cross-cutting impact, and therefore it is soextremely difficult to empirically measure. Decentralisation is rarely used without focusing onone or several other dimensions of development. Some of the main issues are for instance:

Governance Participation and empowerment Environment and natural resources Conflict Planning administration Poverty and human development

Governance:

Since the 1990s governance is an omnipresent concept in development discourse, anddemocratic and decentralized governance is increasingly considered a requisite componentof development. It may be broadly defined as

the system of values, policies and institutionsby which a society organizescollective decision-makingand action related to political, economic and socio-cultural and environmental affairs through the interaction of the state, civil societyand the private sector (Work 2003: 5).

Governance, like decentralization, is a dynamic and context dependent concept. It comprisescomplex mechanisms, processes and institutions through which citizens and groupsarticulate their interests, mediate their differences and exercise their legal rights and

obligations.


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Over the years, the governance paradigm has been qualified by the attribute good: what isgood governance? Apparently, many conceptual frameworks have been formulated thatdelineate what good governance is. All of these refer invariably to the specific topic, contextand place they are meant to serve. Hence the concept of good governance is as contextdependend as decentralization. This, however, does not mean that some notions areconsidered the centre of this search for the Good:

Accountability

Responsiveness

Transparency

Participation in decision-making

Administrative and bureaucratic capacity and efficiency

Respect for human rights

Political openness

Tolerance

Partnerships

Inclusion of the poorest and marginalized section of society

Etc., etc.

Participation and empowerment:Participation and empowerment gained prominence in the past twenty years.Decentralization is increasingly viewed as a means to involve communities directly in thedevelopment of social programmes. There is a tendency of decentralization not only fromcentral governments to local governments but also to civil society organizations (delegation).Again, in which way decentralization policies contribute to the enhancement of participation,and what kind and degree of participation that is (an entirely different discourse), depends oneach case. There is broad agreement that local accountability and local political participationby the poor may affect equity in terms of distribution and greater balance in service provision,resource allocation, and the redistribution of resources.

This topic of participation is particularly relevant in local government reforms, where thenotion and methods of participatory planning have to be introduced (varying types anddegrees of participation at regional, district and local level). It is here that one of the mostfrequently uttered purpose of decentralization comes in, namely that local governments andcommunities are the most effective institutions for solving local problems of the people. Inthis way decentralization facilitates the promotion of democracy and increased participationof the population in the life of the society.

Conflict:By the mid 1990s sub-national ethnic or religious conflict attracted Western governments andaid agencies to strategies of decentralization. It was recognized that the type of conflicts

changes from nation-state-based ideological conflict to cultural conflict. Hence, it is argues,governments need to consider decentralization strategies that might assist in holdingtogether fragmented groups within their borders: attention was drawn to federalism andconfederalism as possible political solutions.

Schou and Haug (2005: 4) write:The purpose of decentralization in terms of ethnic conflict managementdiffers significantly between governments in unitary and federal statesrespectively. In unitary states governments often use decentralization as a toolfor eroding ethnic identity and solidarity. Federal governments often apply theexact opposite approach; they explicitly recognise the rights of ethnic groups in anational system of ethnic accommodation. They believe that accommodation of

national minorities holds the key to stability and unity. The evidence is mixed withregard to the impact of federalism on conflict. Some authors (based on largecase studies) argue that federal solutions may have a conflict mitigating potential


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in the short term, while in the long term secession is a distinct possibility.Findings from comparative qualitative case studies provide a mixed picture.Some argue that true autonomy prevents secession while others point to thedismal track record of federal states.

In contexts in which decentralization succeeds, the process could have a significant conflictmitigating potential through the mechanisms identified below:

a) a broadening of popular participation, in particular by inclusion of minority groups inpolitical processes;

b) bringing sub-national groups into a bargaining process with the government;c) increasing state legitimation through broadened local popular participation;d) establishing state outreach and control in remote areas;e) building trust between groups that participate in local governance institutions;f) redistribution of resources between regions.

During recent years multiethnic federations have been proposed for a significantnumber

of divided societies, including Indonesia, Philippines, Iraq, Sri Lanka,Afghanistan,Burma and Nepal. Devolution within a unitary state is also considered an optionin someof the above mentioned cases and this model has been high on the politicalagenda inNepal and Afghanistan. Moreover, governments in several unitary multiculturalstates inSub-Saharan Africa such as Ghana, Ivory Coast, Uganda and Malawi haveembarked on adecentralization process and used devolution as a conflict management tool.(Schou and Haug 2005: 16)

Decentralization may be utilized as conflict mitigation potential:1. Political inclusion of new groups2. Deepening of democracy as a means of national integration3. State legitimation4. State penetration

But decentralization may also be the reason for an intensification of conflicts:1. New political spaces and new political forces2. Coping with regional differences3. Conflict over resources4. Tension between national and sub-national governments

Planning administration:Planning is a key function of governments. The implementation of decentralization within theplanning system goes often hand in hand with local government reforms in respectivecountries and the devolution of powers. In order for a decentralized planning organization tofunction, the instruments of planning administration have to be adjusted, such as theformulation of a district planning framework and participatory guidelines, establishment ofdistrict development funds, and so forth. This involves at a minimum level a higher degree ofautonomy and involvement of the respective planning levels (district, region, local), andshould also include fiscal devolution. The case study on Sri Lanka (see below) illustrates howcomplex and contradictory such a process can be.

Poverty and human development:In 1990s, the argument that decentralization can help ensure human development foundgrowing support. Human development is understood by UN organizations as individual well-


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Avenues of intervention and reform for decentralization

On account of the multi-dimensional and contextual nature of decentralization processes, it isnot easy to identify generic elements for policy formulation. At least three implications forpolicy makers may be suggested:

1. decentralization changes the mobilization and allocation of public resources, thusaffecting a wide range of issues from service delivery to poverty reduction,

2. the management of decentralization requires an intimate knowledge of localinstitutions and understanding of processes of decentralization,

3. Limited empirical evidence exists about what works and what not (context dependentdimensions).

For policy makers to keep in mind: the main goal of public sector activities is to meet citizensneeds.To achieve this, decentralization is one of the main tools for public administration reforms.

Three major areas of intervention do exist, according to the types of decentralization:

PoliticalPolicy making systemsInter-institutional relationsOverlooking bodies

AdministrativeDe-concentrate administrationInter-governmental administrative relationsCivil service structuresCompetencies & ProceduresICT (information-communication technology)

FiscalRevenues collection & managementTax collection & managementInvestment planningPublic expenditure management systemFiscal transfers & compensatory mechanisms

Major considerations about design and implementation

The following recommendations may be considered for the design of a decentralization

policy: successful decentralization depends on institution specific design (World Bank

1998: 7), Designing a decentralization policy is particularly difficult in developing countries,

since institutions, information and capacity are very weak, The design of policy can considerably alter the impact of decentralization, Characteristics of the political and administrative environment, Specificity of the public sector task to be decentralized, Levels of efficiency, effectiveness, and accountability that are sought, Actors and means essential to carry out roles related to the task, Possible changes in actor, institutional and organizational responsibilities that can

and should take place.


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promising. However, special measures are needed to include marginal groups.(Schou and Haug 2005: 4)

Selected References(for more see reading list in the reader)

Cohen, John M. and Stephen B. Peterson, 1999, Administrative Decentralisation: strategiesfor developing countries, published for and on behalf of the United Nations, WestHartford, Conn.: Kumarian Press; recommended reading Chapter 1 (Evolution ofDecentralisation Concepts) and Chapter 2 (Current Frameworks of Decentralisation).

Gemeinsame Landesplanungsabteilung Berlin-Brandenburg, 2000, Best projects practice:two federal lands a European region on its way to sustainable development,Potsdam.

Litvack, Jennie, Junaid Ahmad and Richard Bird, 1998, Rethinking decentralization indeveloping countries, World Bank -Sector Studies Series, Report No: 21491,http://www-wds.worldbank.org/

Rondinelli, Dennis A. and G. Shabbir Cheema, 1983, Implementing decentralization policies:an introduction, in their edited Decentralisation and Development: PolicyImplementation in Developing Countries, Beverly Hills/London/New Delhi: Sage.

Rondinelli, Dennis A., James S. McCullough and Ronald W. Johnson, 1989, AnalysingDecentralization in Developing Countries: a Political-Economy Framework,inDevelopment and Change, Vol. 20, pages 57-87.

Schou, Arild and Marit Haug, Decentralisation in Conflict and Post-Conflict Situations,Working Paper: 2005:139, Norwegian Institute for Urban and Regional Research, Oslo.

Smith, Brian, 2002, Decentralization, in Kirkpatrik, Colin, Ron Clarke and Charles Polidano(eds.), Handbook on Development policy and management, Cheltenham: Edward ElgarPublishing, pp. 389-399.

United Nations Development Programme, 2005, National Human Development Report,

Uzbekistan: Decentralization and Human Development, www.undp.orgWork, Robertson, 2003, Overview of Decentralization worldwide: a stepping stone to

improved governance and human development, in Brillantes, Alex B. et al. (eds.),Decentralization and Power Shift: an imperative for good governance, Asian ResourceCentre for Decentralization, University of the Phillipines.

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