Introduction

1. Introduction • Local Economic Development is being implemented within the broad framework of decentralisation • One of the objectives of Uganda`s decentralisation is to enhance local economic development in order to increase local incomes and expand local revenue bases. • This policy shift in implementation of decentralisation was meant to address the apparent gap in the original design of the decentralisation policy which did not take full account of local economic development.

2. Structure of Government System in Uganda • Central Government responsible for Policy setting, monitoring, support supervision • Local Governments responsible for Sub-national development and delivery of services • All done is in a decentralized framework

3. Objectives of the Decentralisation • The objectives of the Decentralisation policy in Uganda are to: • Transfer real power to districts and thus reduce the load of work on remote and under resourced central officials. • Bring political and administrative control over services to point where they are actually delivered, thereby improving accountability and effectiveness, promoting peoples feeling of ownership of programmes and projects executed in their districts. • Free local managers from central constraints and, as a long-term goal, allow them develop organisational structures tailored to local circumstances. • Improve financial accountability and responsibility by establishing a clear link between the payment of taxes and the provision of services they finance. • Improve the capacities of the councils to plan, finance and manage the delivery of services of their finance and manage the delivery of services of their constituencies. • Support local economic Development in communities

4. Powers Devolved to LGs • The powers devolved include: • Political powers – Councils are headed by politically elected leaders by universal adult suffrage • Financial powers – Councils collect and appropriate resources in their budgets • Administrative powers – Councils manage staff in their districts • Planning powers – Councils make development plans for their areas • Legislative powers – Councils make ordinances or bye-laws • Judicial powers – Executive committees at the village and parish also double as local council courts. At sub-county/town council there is also a local council court.

5. Strategic Role of LGs: Range of LG System Outputs Local Government System Policy, Legal & Regulatory Framework Institutions, Systems & Procedures Capacities & Financing Specialized LG System Outputs Basic Social Services Natural Resource Management Local Economic Development Food Security Social Protection Other M D G Local Development

6. Local Economic Development - Objectives • Local Economic Development Focuses on: • Enhancing Competitiveness of a Local Economy; • A Diversified Local Economy; • Which is Agile & Responsive • Efficient at Utilizing Resources (human, natural & financial) • and has a Highly Productive/Efficient Labour and Enterprises • Achieving Sustained Growth of a Local Economy; • Sustained Growth of Outputs of an Economy’s Sectors, Clusters and Value Chains • Sustained Growth in Quality Employment • Sustained and Growth in Household Income • Ensuring Equity/Inclusiveness of Economic Growth; • Equitable Distribution of Growth in an Economy’s Formal and Informal Sectors • Equitable Access to Employment and Growth Opportunities by all

7. Local Economic Development Framework Model by Mutabwire 2010 • National Government: • Policy and Legal Framework • Political Support and Advocacy • Resources • Planning (National Development Plan) • Regulatory Framework • Local Governments • Planning • Resources • Implementation • Review LED Services Regulation PPP • Community • Indigenous knowledge • Social Capital • Livelihood and Safety net systems • Resources • Private Sector • Business knowledge • Value chain • Financial Institutions Market

8. Local Economic Development: Four Main Pillars • Locality development, • strengthening competitiveness and enterprise development, • promoting local economic governance • building community conscience and improvement of their well-being.

9. Local Economic Development (LED) and Decentralisation Framework Source: P. Mutabwire 2010 Decentralisation Framework Decentralisation Framework Decentralisation Framework Decentralisation Framework LOCAL ECONOMIC DEVELOPMENT LOCAL ECONOMIC DEVELOPMENT LOCAL ECONOMIC DEVELOPMENT LOCAL ECONOMIC DEVELOPMENT Local Economic Governance Local Economic Governance Local Economic Governance Enterprise Development Enterprise Development Enterprise Development Local Economic Governance Enterprise Development Community Economic Development Locality Development Locality Development Locality Development Locality Development • A conducive regulatory and physical business environment realised • PS involved in Planning and decision making • LG business • Capacity development • A conducive regulatory and physical business environment realised • PS involved in Planning and decision making • LG business • Capacity development Small and Medium Enterprise Small and Medium Enterprise • A conducive regulatory and physical business environment realised • PS involved in Planning and decision making • LG business • Capacity development Small and Medium Enterprise Small and Medium Enterprises • Strengthening of Private Sector • Increase Business • Increased tax base for LGs • Employment Creation • Strengthening of Private Sector • Increase Business • Increased tax base for LGs • Employment Creation • Strengthening of Private Sector • Increase Business • Increased tax base for LGs • Employment Creation • Strengthening of Private Sector • Increase Business • Increased tax base for LGs • Employment Creation • A conducive regulatory and physical business environment realised • Private Sector involved in Planning and decision making • LG business • Capacity development • Increase Household incomes and quality of life • Increase Household incomes and quality of life • Increase Household incomes and quality of life • Increase Household incomes and quality of life

10. Local Economic Development: The new agenda for local governments • LED is also being introduced into the local governments’ portfolio of investments in a bid to enhance people’s incomes and expand the tax base for local governments. • The declining LG local revenues coupled with the weak linkage between local revenues & service delivery has created a fiscal crisis in LGs. • This crisis provides an opportunity for stimulation of a changed relationship between LGs & tax payers as well as a fertile ground for mobilization of local resources through LED.

11. National and local enabling environment • State of the Legal provisions and policy framework: • Constitution of Republic of Uganda, • Local Governments Act, • National Development Plan-Subnational development, • Decentralisation Policy Strategic Framework, • Local Government Sector Plan, • LED Policy and Strategy • Supporting Regulations-e.g Procurement and Finance regulations

12. LED policy and strategy • A LED policy and strategy for local governments is being finalised. • The overall goal of the LED strategy is to contribute to poverty eradication focusing on: • Improving local governance for sustainable local economic growth; • Employment creation; • Increased production and productivity of enterprises; • Increasing incomes; and • Broadening the tax base for local governments to deliver the mandated services.

13. Implementing LED • Local Economic Governance • Locality Development • Enterprise Development • Institutionalisation • Strengthening LG planning systems • Gender in LED

14. Previous Planning Framework National Development Plan DDP MTEF NATIONAL PLAN / BUDGET LLG PLANS

15. New Dispensation in Planning NATIONAL DEVELOPMENT PLAN NATIONAL PLAN/ BUDGET DDP / MUNICIPAL DEVELOPMENT PLANS • LOCAL ECONOMIC ASSESSMENT • Resource endowment • Investment gaps • Investment opportunities • Capacity gaps • Impact of policy framework LLG PLANS

16. Progress to Date • National LED Resource Team (NRT) • Programme in 5 Pilot districts • Local Economic and Business Assessments done in 5 Districts • Implementing Quick wins • Integration in District Development Plans

17. Local Economic and Business Assessments • Areas of Assessment • Local Economy Assessment • Regulatory Environment Assessment • Economic Infrastructures and Social Services survey • Business Assessment • Financial services sector assessment • Public private Partnership (PPPs) Assessment • Civil Society Organisation(CSOs) Assessment

18. Key strategies for Strengthening Roles of LGs in Local Development • The key strategies adopted by the Government of Uganda for deepening the implementation process of the decentralisation policy and strengthening the role of LGs in Local Development include; • creating an enabling framework for citizens, NGOs, Community Based Organisations (CBOs) and the private sector to perform an oversight role in the way public funds are being spent by Local Governments. • promoting public-private partnerships (PPPs) in service delivery; • enhancing the capacity of central and local leaders to internalize their roles and functions; • enhancing political, administrative and fiscal accountability, both vertically and downwards; and • extensive civic education on rights and obligations of all stakeholders in local development

19. CONCLUSION: Are Local Governments ready for Local Economic Development? • Yes- Preliquisites include: • National enabling laws and framework for LED • Change of mind set- LGs being focused on development of their local economies • Reviewing development planning to factor in business and economic assessment • LGs should utilize the proximity in a given locality to enhance cooperation and networking among stakeholders • local government should make conducive regulations to facilitate business and locality development activities

20. Conclusion-Looking into the future • Strong and vibrant local economies will provide a broad revenue base from which local governments can mobilize resources to finance their mandates under a decentralized system of governance. • A strategic way forward for financing decentralisation is through initiating policies aimed at wealth creation and increasing people’s incomes