Implementing Decentralized Local Governance: A Treacherous Road with Potholes, Detours, and Road Closures
During the past two decades, a silent revolution in public sector governance has swept across the globe aiming to move decision making for local public services closer to the people. The countries embracing and adapting to this silent revolution have had diverse motives and followed even more diverse approaches. This paper attempts to present a stylized view of the motivations and approaches used to strengthen local governance. The quest for the right balance, i.e. appropriate division of powers among different levels of government, is not always the primary reason for decentralizing. There is evidence that the decentralization decision may have more to do with short-term political considerations than the long-run benefits of decentralization. To take stock of progress worldwide, we take a comparative look at developments in political, fiscal and administrative decentralization for a selected group of countries. Most of the decentralization literature deals with normative issues regarding the assignment of responsibilities among different levels of government and the design of fiscal transfers. The process of decentralization has not received the attention it deserves as the best laid plans can fail due to implementation difficulties. We revisit major controversies regarding preferred approaches to obtaining a successful outcome. Key approaches examined are big push versus small steps; bottom up vs. top down; and uniform vs. asymmetric decentralization. Finally, Indonesia's 1999 big bang decentralization program is evaluated. The program should be commended for its achievements over a short period of time, however incentives are lacking for local governments to be accountable and responsive to their residents.
| Summary: | During the past two decades, a silent
revolution in public sector governance has swept across the
globe aiming to move decision making for local public
services closer to the people. The countries embracing and
adapting to this silent revolution have had diverse motives
and followed even more diverse approaches. This paper
attempts to present a stylized view of the motivations and
approaches used to strengthen local governance. The quest
for the right balance, i.e. appropriate division of powers
among different levels of government, is not always the
primary reason for decentralizing. There is evidence that
the decentralization decision may have more to do with
short-term political considerations than the long-run
benefits of decentralization. To take stock of progress
worldwide, we take a comparative look at developments in
political, fiscal and administrative decentralization for a
selected group of countries. Most of the decentralization
literature deals with normative issues regarding the
assignment of responsibilities among different levels of
government and the design of fiscal transfers. The process
of decentralization has not received the attention it
deserves as the best laid plans can fail due to
implementation difficulties. We revisit major controversies
regarding preferred approaches to obtaining a successful
outcome. Key approaches examined are big push versus small
steps; bottom up vs. top down; and uniform vs. asymmetric
decentralization. Finally, Indonesia's 1999 big bang
decentralization program is evaluated. The program should be
commended for its achievements over a short period of time,
however incentives are lacking for local governments to be
accountable and responsive to their residents. |
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