Public Administration Reform and Decentralized Governance

1. Regional Workshop, Poverty Reduction, Capacity Development and, Local Governance September 3-6, 2007 Elissar Sarrouh Senior Advisor Public Administration Reform Democratic Governance Group Public Administration Reformand Decentralized Governance

2. Part I: UNDP Support to Public Administration Reform: Sorting Out the Basics Part II: New Trends, Opportunities and Challenges in Public Administration Reform Part III: PAR/LG and UNDP Strategic Plan 2008-2011 Presentation Outline

3. UNDP Support to Public Administration Reform: Sorting Out the Basics PART ONE

4. “an efficient, accountable, effective and transparent public administration, at the local, national and international levels, has a key role to play in the implementation of internationally agreed goals, including the MDGs”. In that context, the Resolution stresses the need “to strengthen public sector administrative and managerial capacity-building, in particular in developing countries, and countries in economic transition”. General Assembly Resolution 57/277 On Public Administration & Development

5. UNDP and PARHistorical Trends, 1999-2003 • 380 projects in 112 countries and 5 regions • 63% in Medium HDI countries • 24% in Low HDI of no HDI countries

6. RBA – driven by structural adjustment and strong donor pressure; decentralization focus; CSR; ‘holistic’ approaches RBAP – UNDP increasingly crowded out; shift towards decentralization; CSR, institutional capacity building, public awareness and pro-poor reform RBAS – few countries, focus on technical reforms, anti-corruption, ICT RBEC – EU accession; transitional economy issues RBLAC – shift from focus on economic and financial management (“modernization”) to more ambitious approaches: NPM, performance-based CSR, and introducing ‘voice’ Regional Trends

7. UNDP and PARHistorical Trends, 1999-2003 (Cont’d) Trends in UNDP PAR interventions: • Promoting a Professional Civil Service, 35 interventions • Functional Reviews, 82 interventions • Training of Civil Servants, 310 interventions • ICT to Enhance Public Services, 63 interventions

8. UNDP Challenges in PAR • Sustainability of neutrality in a politically charged and changing environment • Securing cooperation among stakeholders • Ensuring continuous support ?? • Crowded Out?

9. New Trends, Opportunities and Challenges in Public Administration Reform PART II

10. Emerging Trends in UNDP PAR Interventions • PAR accounted for 40% of all democratic governance expenditures of UNDP during the last three years. • Enhancing Local Governance is an emerging trend in the PAR area.

11. Emerging Trends in UNDP PAR Interventions

12. Emerging Trends in UNDP PAR Interventions

13. PAR at Local Levels of Government

14. Decentralization/Local Governance accounts for 21% of all democratic governance expenditures of UNDP during the last three years. PAR interventions are increasingly integrated into UNDP decentralization/local governance projects. PAR interventions are components of 53 activities reported under Decentralization and Local Governance line of the Results database (total 81 activities) in 2006. It means that at least 65% of all Local Governance interventions of UNDP include a PAR component. PAR and UNDP Decentralization and Local Governance Interventions

15. Local Governance: can improve resource allocation and service provision by bringing decision makers and service providers {duty bearers} closer to service users {rights holders}; allows developing unique solutions to unique problems; allows for a greater involvement of citizens in decision making regarding public services; and is one of the predominant approaches to strengthening democracy. Why Local Governance?

16. Public Administration Reform (PAR) can achieve the following objectives: Strengthen local governance capacity through training and other capacity building tools; Establish new accountability frameworks promoting local governance; Enhance local accountability by establishing mechanisms for direct interaction between local residents and local public administrations; Clarify financial aspects of center-local government responsibilities (e.g., revenue collection, transfers, budgeting); and Strengthen local NGOs and other stakeholders in their ability to be proactively involved into local level decision making. PAR and Local Governance

17. Political decentralization transfers political power and authority to sub-national levels such as elected village councils and state level bodies. Where such transfer is made to a local level of public authority that is autonomous and fully independent from the devolving authority, devolution takes place. Under fiscal decentralization, some level of resource reallocation is made to allow local government to function properly, with arrangements for resource allocation usually negotiated between local and central authorities. Administrative decentralization involves the transfer of decision making authority, resources and responsibilities for the delivery of selected public services from the central government to other lower levels of government, agencies, and field offices of central government line agencies. There are two basic types. Deconcentration is thetransfer of authority and responsibility from one level of the central government to another with the local unit accountable to the central government ministry or agency which has been decentralized. Delegation, on the other hand, is theredistribution of authority and responsibility to local units of government or agencies that are not always necessarily, branches or local offices of the delegating authority, with the bulk of accountability still vertical and to the delegating central unit. Finally, divestment or market decentralizationtransfers public functions from government to voluntary, private, or non-governmental institutions through contracting out partial service provision or administration functions, deregulation or full privatization. Defining Decentralization

18. Decentralization does not automatically lead to improved developmental outcomes for the poor and other disadvantaged groups. In the absence of effective local accountability frameworks, some local officials may divert the funds for personal gain. Performance of the public service may suffer because decentralization entails new lines of accountability and reporting. Limited capacity of local governments may hamper local decision making and service delivery (e.g., revenue collection, budgeting, determining expenditure priorities). Challenges of Decentralization

19. Fiscal decentralization defines how and in what way expenditures and revenues are organized between and across different levels of government in the national polity (Source: UNDP, Fiscal Decentralization and Poverty Reduction, 2005) To be really independent in their decisions and accountable to local residents, local governments should be able to: Mobilize resources from the local community and reduce its financial dependency on the central government; Determine its own expenditure priorities; Have sufficient revenue to meet their obligations; and Be accountable to local residents for their fiscal management. Fiscal Decentralization As a Condition for Successful Decentralization

20. Support local governments in developing their capacity to set their own expenditure priorities through consultations with local residents and stakeholders. Ensure through functional and policy reviews that central ministries do not consume scarce national resources for functions that have been decentralized. Support development of local taxing and budgeting capacities. Embed results- and performance focused approaches into fiscally decentralized systems so that fiscal decentralization benefits the poor and other disadvantaged groups. How PAR Can Help in Fiscal Decentralization

21. Ensure that revenue sharing between the central and local governments is a transparent process so that citizens would understand how much is being shared and for what purposes. Take into consideration human rights implications of fiscal decentralization reforms in terms of analyzing whether public services are improved and rights better protected. Enhance local accountability and monitoring frameworks to support public participation in financial decision-making. How PAR Can Help in Fiscal Decentralization (Cont’d)

22. PAR/LOCAL GOVERNANCE and UNDP Strategic Plan 2008-2011 PART III

23. Multi Year Funding Frame (MYFF) 5 Goals MDGs and POVERTY REDUCTION DEMOCRATIC GOVERNANCE ENERGY & ENVIRONMENT CRISIS PREVENTION and RECOVERY HIV/AIDS 5 Service Lines Decentralization/LG (2.6) Public Admin Reform/AC (2.7) UNDP Strategic Plan: Old and New

24. STRATEGIC PLAN 4 Focus Areas MDGs and Poverty Reduction Democratic Governance Crisis Prevention and Recovery Energy and Environment 4 Key Results Area Outcomes Indicators Baselines Targets UNDP Strategic Plan: Old and New

25. Key Result Area or Cluster II: Strengthening Responsive Governing Institutions Key Result Area/Cluster III: Grounding Democratic Governance in International Principles Democratic Governance Focus Area Key Result Area or Cluster I: Fostering Inclusive Participation

26. GOAL {2}: To strengthen national and local capacities for democratic governance, building upon the principles of the Millennium Declaration and the World Summit Outcome Focus Area 2: Democratic Governance

27. OUTCOME {2.2.4} National, regional and local levels of governance expand their capacities to manage the equitable delivery of public services and to reduce conflict KR 2.2: Strengthening Responsive Governing Institutions

28. KEY INDICATORS {outcome 2.2.4} KR 2.2: Strengthening Responsive Governing Institutions • No. of targeted countries that have implemented initiatives aimed at strengthening local government capacities • No. of targeted countries where participatory or accountability practices in local government have been improved • No. of targeted local governments that have prepared, in consultation with all relevant stakeholders, local development plans that provide for the equitable delivery of public services

29. Capacity building in the area of PAR and local governance through: Preparing a resource guide/Tool Kit on PAR and local governance Providing training supporting the roll-out of the resource guide/Tool Kit (e.g., web casts) Sponsoring a series of regional workshops to promote the resource guide/Tool Kit Seeking feedback from communities of practice on drafts of the resource guide/Tool Kit on PAR and local governance Identifying and supporting potential South-South cooperation in the area of PAR and decentralization PAR AT LOCAL GOVERNANCE:Proposed Tools and Resources

30. A resource guide on PAR and local governance would: Review the current state of the art research on the role of PAR in decentralization Identify successful practices in UNDP interventions (e.g. world wide and region-specific, by area of focus) Include specific recommendations for teams developing decentralization and local governance projects on how to develop and implement effective PAR interventions (e.g. checklists, suggestions regarding process, including sequence, communication with stakeholders) Provide a list of indicators that can be utilized to measure success of PAR interventions in the area of decentralization PAR and Local GovernanceProposed Tools and Resources

31. THANK YOU