Introduction
Proponents of decentralization argue that it is a tool for increasing accountability among decision-makers. This is by correcting the problems that come with poor information and incentives which lead to poor public spending decisions (UNDP, 2005). Devolution of power to local governments leads to changes in the way public funds are spent. For instance, local governments are more likely to spend on education, health, and civil works rather than sectors like tourism, industry, and hydrocarbon.
This results in public output that is closely related to the things that people want. The local government is in a position to do this because it is more familiar and has a greater understanding of the capacity, incentives and challenges that will give the public output desired by people.
Decentralization is commonly a feature of a democratic system. The government in a democratic system has certain functions that it should fulfill. Among these is the provision of security, ensuring that all are treated equally under the law and the provision of public services among other functions. There is therefore a contract between the government and its citizens for the accomplishment of these functions. This contract usually exists in the form of a constitution which contains broad principles of how the government will work.
There are also national laws and other laws that may be considered sub-national and other regulations which are specifications of the broad operating principles. The contract, therefore, becomes more operational at a local level with citizens participating in government to provide some management and monitoring of the contract. For a decentralization process therefore to begin, it has to have some legislation to carve its path. The formulation of policies and directives coupled with the creation of institutions to enhance the decentralization process then follows.
Models of decentralization
The various dimensions of decentralization have been addressed in different ways in different countries around the world. For instance, Indonesia has a policy statement for the urban sector that gives the local government the responsibility of delivering basic services. The central government however has not awarded autonomy to the local governments. Most people employed by the local government view themselves as still employed by the central government and most even hope to be promoted into the central government. The Philippines is one of the countries where a high level of autonomy has been attained by local governments.
The local government has a code that makes provision for assignment of responsibilities, selection of officials and that also makes provision for systematic sharing of resources and taxes. The local government has the authority to collect taxes and make charges (Johnson and Minis, 2005).
The model of decentralization in most Eastern European countries involves re-assigning responsibilities that have never been done before by the municipalities or local governments. The central governments have however retained most of the control over resources such as taxes. This makes it difficult for the local governments to perform their new responsibilities (Johnson and Minis, 2005).
India is a country in which the decentralization strategy has resulted in a sort of mixed situation where certain functions of urban development are the responsibility of local government but the state has most of the control. In many regions, the control of the local government is almost minimal and there is great difficulty in getting the development agencies of the state to select certain programs for investment. The constitution in this country, however, is such that the state is required to develop a mechanism for empowering local governments (Johnson and Minis, 2005).
The major elements in setting up a decentralization program include, first assigning the expenditure and revenue systems while giving consideration to the intergovernmental system that will be in operation. The second issue to deal with is the systems of administration that will enable the local government to have adequate autonomy. Third, incentives need to be put in place so that the different institutions and individuals have the motivation to do what is expected of them. Human resources also need to be strengthened so that the individuals who have been elected and appointed to various positions are able to perform their duties well.
Community participation is important if the decentralization process is to be successful (Johnson and Minis, 2005). Community participation coupled with NGO involvement allows local government systems to provide a reflection for the preferences of the citizens making the chances for success higher.
Steps of decentralization in Bolivia
The first step in the decentralization program of Bolivia will be to identify the main dimensions of decentralization. This will ensure that the program stays within its objectives and empowers local government adequately enough to ensure effective functioning. Decentralization cannot exactly be defined as a single model or an all-or-nothing approach, hence the importance of identifying various dimensions of decentralization. These dimensions are political accountability, functional responsibility, and access to resources (Johnson and Minis, 2005). Functional responsibility refers to a clarification of all the different responsibilities of various levels of government.
This is important for the purposes of assigning expenditure to different departments. Common practice is for local government to be concerned with providing certain basic services such as a collection of solid wastes, sweeping of streets, maintenance of public markets and also planning for and providing various social services and physical infrastructure. Decentralization will lead to an increase in the responsibilities of local government. These new activities in every department need to be well described.
Resources also need to be assigned to these responsibilities. When there is an increase in resources that can be allocated to the local government, the effect is stimulation of the public to participate in government and decisions that involve investment (UNDP, 2005). Political accountability is the third dimension which refers to a system whereby the central government can regulate the local government as well as a system whereby there is downward responsibility amongst local office bearers to the local community members. This provides for a higher level of regulation using local political processes.
Decentralization needs to be supported by a legislative process so that once the decentralization program is complete it is not deemed unconstitutional. The process of decentralization in Bolivia began with the Law of Popular Participation (LPP) adopted in 1994 (Seemann, 2004). The law encompasses various aspects such as political, territorial, administration, and issues of finance. The law creates several changes, the first being the transfer of various responsibilities and revenue sources to municipalities. This is coupled with the creation of more municipal authorities in both rural and urban areas. Secondly, is the recognition of
organizations in both urban and rural areas that are territorial. This is accompanied by the creation of a committee that would be involved in planning and carrying out audits of the municipal budgets.
This law subdivides Bolivia into municipalities, paving the way for the decentralization process.
This subdivision should be accompanied by an automatic entitlement to receive a certain amount of the resources in the nation. This distribution of resources should be based on the needs of the municipality. One of the major determinants of how much each municipality will get is the population of that municipality. Calculation of resource allocation by per capita basis should be done on the basis of population figures for the current years so that the revenues allocated are not a mismatch with the population, but are able to meet the needs of the population.
Where the revenue cannot meet population needs then, alternative sources of resources are sought with the correct deficit in mind. The revenue transfers should be aimed at complementing whatever the municipality has in terms of its own source of revenue which in Bolivia mainly comes from taxes on vehicles and property. All municipalities should have their own bank accounts where they will receive money for the running of the municipality and provision of services.
To complete the legislative framework for decentralization, a law regulating the functioning of the different departments which act as intermediate levels between the local government and central government needs to be put in place. The departments will be responsible for supervision and administration of resources and aligning budgets in areas such as health, education, and social assistance.
For the purposes of strengthening local power various levels of planning should be created, for example, the National level, the Departmental level, and the Municipal level. The departmental level will have the most significant tasks such as the representation of the national executive power, formulation, and design of the plans for development as well as coordination of the national and municipal power. Legislation for the decentralization process should be such that it is seen to separate the departments and the central government. The departments should have their roles and functions clearly defined so that there is no duplication of function.
Further, legislation should also show great confidence in the departments. That is by not requiring municipalities and departments to hand over their budgets for parliamentary approval and granting the municipalities enough autonomy to make their own decisions. The officials at the departmental level should be elected by the people so that they are true representatives of the people rather than political appointees. By giving the officials the authority to collect taxes and incur expenditure, the departments will have more autonomy and will therefore be able to carry out their functions better as intended by the LPP.
The LPP will help to promote social participation at the local level. By making it possible to have institutions that will mediate relations between the Bolivian state and the civil society, the participatory government will be easier to achieve. The laws mentioned above will bring about certain changes, first will be the institutionalization of social involvement, second is the creation of new municipalities, third is the fair and equal distribution of resources from central government to local government.
The laws provide a means for monitoring the flow of funds and also provide a means by which an increase in the percentage of taxes being remitted to the local government can be increased. The fourth change is the rearrangement of the national executive in such a way that it complies with the regulations of legislation paving the way for decentralization.
Rearrangement of the national executive will be necessary so that there can be adequate support for the functions of the municipal authority while at the same time there is some degree of integration of the functions of the national executive. The second law Law of Administrative Decentralization (LAD) while attempting to preserve the national political unit will also have a regulatory role in maintaining the new political order of a municipal structure in the presence of a central government (Seemann, 2004).
This will be done through the creation of other administrative units that will oversee other departments and the definition of these units in terms of tasks that they will accomplish. The LAD also makes provision for the creation of councils for every department that will elect the councilors for each municipality. These councils will have the role of supervising departmental plans, approving the annual pre-financial plan, and coordinating governments (municipal governments).
The national institutions will mainly have the role of providing assistance. Once the legislative pathway for decentralization has been cleared as described above the next step is to ensure that the national institutions created within the legal framework for decentralization are strong enough to provide support to the local government. Most of these national institutions should include financing mechanisms and institutions of national training and technical assistance.
A system of national planning should also be put in place to ensure that planning within the municipalities is linked to the national system. This will help in the consolidation of the plans to the major public levels, that is national, departmental, and municipal.
For there to be an optimum performance from the institutions and individuals as well, the decentralization process ought to put in place incentives that will motivate the people to work well. Incentives can be in the form of good salaries, flexible working hours. Ensuring also that the local governments truly have the autonomy that is constitutional for them to have can also serve as motivation. This is because then they are able to operate freely and effectively with enough authority over their specific regions. If the central government retains most of the control and revenue the likely situation is that local government officials will find difficulty in meeting their new added responsibilities and eventually get unmotivated.
The next step in the decentralization process is to strengthen human resources. Human resources can be strengthened by undergoing training in technical expertise, having workshops arranged for them where they can learn more about governance. Skilled human resource is effective and efficient and will most likely produce positive results for the decentralization process. Professionalism is required in things like conducting and directing meetings, organization of discussions hence the need for training and building capacity. Improvement of human resources will also lead to better accounting and reporting.
An audit system would be effective in ensuring that the employees do not mishandle public coffers and in promoting accountability. To manage the problem of inexperience in local management, those municipalities where this is a major problem could benefit from being transferred to other more experienced municipalities where they will observe and learn from those more experienced and transfer the learning to their municipality. To strengthen human resources further, the managerial and technical positions within the municipalities should be awarded to qualified professionals based on merit and not political affiliation. This will lead to greater continuity in the policies and follow-up of these policies.
Fostering and strengthening community participation is the final step in the decentralization process. This is best done by strengthening the information links between the government and its citizenry. Civil society should be given an opportunity for active involvement in the delivery of services and making decisions. This provides an opportunity for citizens to express themselves. It also means that the access and influence of the citizens will be felt in the local government, thus making sure that the local government remains relevant and in touch with the needs of the citizens.
Various strategies can be used for improving information links, among these are the creation of more linkages and capacity building. Having open elections is one of the fundamental ways in which the ability of the citizens to influence decisions is maintained. Legislation that makes it a requirement for local government to collect information from the public about their opinions and needs, gives the public access to the deliberations of the council, or provides information about a government decision that is pending should be put in place. This gives strength to the public and opportunities for expression leading to a participatory government.
Other measures that the local government can put in place to enhance participation include the creation of committees composed of citizens for advisory purposes, creation of development councils in the neighborhood for purposes of assisting in delivery and planning of services, and even publishing of budgetary information or establishment of a budget preparation process that is consultative so that the public can feel included.
Efforts to increase participation should be directed at both the local level and the national level. At the national level, the efforts should be aimed at creating an enabling environment for the local government to function autonomously, while at the local level these efforts should be aimed at capacity building for engagement in good governance. Using both entry points ensures that participation is encouraged as much as possible.
The creation of municipal associations is one of the ways in which support can be provided to areas where the municipal authority has a smaller population. Legislation is important in order to give the municipal association a more solid and legal base. The aim of these associations is the preservation of regional identities such as cultural identities, ethnic or ecological identities, improvement of the social and economic situation of the public in the particular municipalities.
This is while in the process of establishing priority lists that are similar. The associations could also provide the necessary stimulation to institutions so that a production process is set in motion from having a large bargaining base. This would mean that the municipalities will be in a better position to achieve their goals. Another advantage of well legislated municipal associations is the ability to develop their own deals for investment in the public, social and private sectors.
This would increase the revenues coming to the municipalities and thus providing a possible solution for the problem of inadequate funds. Municipal associations would also help in the improvement of human resources, especially where the municipalities with little experience in local government management are in membership together with others who have more experience.
Conclusion
The various dimensions of decentralization are demonstrated in a situation of good governance. Good governance is characterized by accountability, legitimacy, the effectiveness of management, and the availability of information. When all this is present in the decentralization program of Bolivia the government is likely to be successful in its efforts. It means that there is going to be public acceptance of those who are in power in local government, with a respect for the rules, procedures, and processes of the local government.
When public resources can be transformed into services that are useful to the public in correspondence to the priorities of the public then the decentralization process will also have succeeded. This coupled with an information flow that gives the public the power to participate, hold accountable the government, and judge whether those in authority are effective is also a sure sign of a positive working decentralized government.
References
Johnson WR and Minis HP, 2005, Toward Democratic Decentralization: Approaches to promoting good governance. Web.
Seemann M, 2004, The Bolivian Decentralization Process and the role of Municipal Associations, HWWA Discussion paper 271. Web.
UNDP, 2005, Democratic decentralization and poverty reduction, The Bolivian Case, The Democratic Governance Fellowship Programme. Web.