"(Representative democracy) must be combined with direct democracy of the citizens, so the people can control the state."

Ubirata de Souza, Rio grande do Sul state official

By Daniel Drosdoff, Porto Alegre, Brazil

The subject was street lighting. the venue was City Hall. But the decision makers were not the mayor, not the City Council, not even a group of senior municipal officials.

At a participatory budget meeting in Brasil's Rio Grande do Sul state, local residents prepare to discuss spending priorities with municipal officials. (Photo: State of Rio Grande do Sul)

Instead, the 32 “counselors” making the critical decisions on street lighting were delegates sent by neighborhood assemblies to defend local budget priorities.

The meeting culminated a year-long process for 16 neighborhood assemblies in Porto Alegre, a city of 1.3 million that is the capital of Brazil’s Rio Grande do Sul state. In each case, the assemblies drew up their investment budget priorities and then chose delegates, known as counselors, to convey them to the city administration.

The counselors at the meeting were people of modest means, dressed informally in shirtsleeves, windbreakers and an occasional gaucho hat. The tenor of the discussion was businesslike and technical. Vera Chiminazzo, director of Porto Alegre’s Division of Public Lighting, answered questions for an hour in a subdued monotone.

One counselor wanted to know why street lighting in one part of the city costs three times more than in another part. Chiminazzo replied that the difference was due to higher infrastructure costs. Another counselor cited a budget item that called for “lighting in all the green areas of communities” in Region 6B. He wanted to know the exact location of these areas. The city officials promised to find out. The meeting ended with a show of hands giving unanimous approval to the budget, even though 53 of the 75 budget items requested by the neighborhood assemblies were rejected with the simple notation sem recursos— no money. The lighting projects would be incorporated into a detailed budget proposal prepared by the municipality’s executive branch. Eventually, the elected City Council would vote the budget up or down.

Local priorities. The meeting on street lighting was one of dozens held in Porto Alegre every year as part of an innovative form of citizen involvement in municipal affairs called “participatory budgeting.” The system was put into practice 11 years ago when the local branch of Brazil’s Workers Party won control of the municipal government with participatory democracy as a central plank in its campaign platform. Today, the Porto Alegre experience is being held up as a model for cities elsewhere in Latin America.

While the participatory budgeting process has detractors, the concept is rapidly spreading in Brazil. According to Lenira Rueda, a researcher for the Brazilian city of Belo Horizonte who is tracking the phenomenon, approximately 70 of that country’s jurisdictions (mainly municipalities but also two states) are using participatory budgeting to one extent or another. Outside of Brazil, the cities of San Salvador, El Salvador, and Cuenca, Ecuador, have adopted participatory budgeting procedures based on the Porto Alegre model (See articles on pages 5–7).

Mayors from these and other cities discussed citizen-based budgeting at an international conference on participatory democracy held last November in Porto Alegre. Víctor M. Vergara, a municipal development specialist at the World Bank, said Porto Alegre is a starting point for studying the phenomenon of participatory democracy as it relates to the budget process. Political scientist Ramón Borges-Méndez of Johns Hopkins University called the Porto Alegre model and other experiences like it “an entirely new way of doing things” in Latin America, where “a whole new generation is getting political experience at the local level.” Augusto Dueñas, a management consultant based in Porto Alegre, said participatory budgeting is “vital for development,” because “it puts distribution of resources in synch with social priorities.”

The IDB’s Marcio Gomes da Cruz stressed the importance of citizen participation as a guarantee of transparency in public administration. “Only if a society effectively controls public administration can we see the establishment of a modern state,” he said. Gomes da Cruz is project team leader of a 12-year fiscal reform project in which $1.1 billion in IDB financing will help modernize public management in approximately 3,800 Brazilian municipalities. As part of the project, the municipalities will include citizen participation in their fiscal reform plans.

Pros and cons. Many urban experts see participatory budgeting as the wave of the future. But even strong advocates of participatory budgeting admit to a frequent weakness: a lack of involvement by the middle class. White-collar workers, professionals, business owners and the wealthy normally shun the mass meetings and assemblies at which neighborhood priorities are determined and delegates elected.

In the case of Porto Alegre, Mayor Raul Pont describes how the city government established “thematic assemblies” to counteract the notion that participatory budgeting is “only for the poor.” These meetings deal not with specific neighborhood problems, but with broad subjects such as transportation, health and social assistance, education, culture, leisure, economic development, taxation and urban development. In San Salvador, Mayor Héctor Ricardo Silva’s answer is to hold smaller meetings that have a broader scope and include issues—such as urban parks—that are more likely to interest middle-class residents.

Not everyone thinks participatory budgeting is a good idea. In the state of Rio Grande do Sul, the leader of the opposition and majority leader in the Chamber of Deputies, Cezar Busatto, can scarcely control his irritation when discussing the subject. According to him, the Porto Alegre system is “illegal,” because there is no formal law regulating it. It is also “Machiavellian,” he says, because citizens curtail their expectations when they feel themselves to be part of the established political order.

But even Busatto concedes that participation in the budgetary process adds legitimacy to public institutions. So his party has decided to fight fire with fire and has established the Democratic Forum, a parallel system of public hearings sponsored by the legislative branch that exists side by side with the participatory system established by the executive branch.

What happens when the political party that establishes participatory budgeting loses an election? The experience of the municipality of Santo André in Brazil’s São Paulo state is instructive. After winning the mayoral election in 1989, the Workers Party established a system of participatory budgeting. But four years later, when the party lost and the system was abandoned, there was little public reaction. Another four years went by, and the Workers Party retook city hall. This time, says Mayor Celso Daniel, participatory budgeting will be applied more vigorously, which hopefully will give the system more staying power. The first time, he admitted, his party took half measures, which he called a “a lack of daring on our part.”

Sustainability is a key aim in the town of Cabo de Santo Agostinho in Brazil’s Pernambuco state. There, in the arid, poverty-stricken Northeast, a far cry from prosperous Porto Alegre, Mayor Elias Gomes is trying to build staying power into participatory budgeting by forging an alliance among six political parties. Once the system is sufficiently strong and well-accepted, he would like to see the process formalized by law. This was the approach taken in Ecuador, where the highland city of Cuenca consolidated participatory budgeting and planning through a voting ordinance.

Leaders of Brazil’s Workers Party have a simple answer to the sustainability question: re-elect the same party to office, or another party that is similarly committed to the system. They say a law is superfluous because, under the Brazilian political system, the executive branch has the responsibility for drafting budgets, and it can opt to skirt a participatory framework if it chooses.

As Porto Alegre’s Mayor Pont puts it, participatory budgeting “requires political will.” But in his city it is also voluntary and open to members of all political parties. Without such openness, he contends, participants would feel “defrauded” and would refuse to participate, thereby making the system unravel. “We defend representative democracy,” says Ubiratã de Souza, coordinator of budgeting and finance for the state of Rio Grande do Sul. “But it must be combined with direct democracy of the citizens, so the people can control the state.”

Still in its infancy, participatory budgeting has a long way to go before it becomes an established political institution in Latin America. But as the roots of democracy continue to spread, a growing number of cities are likely to seek inspiration and guidance from pioneers such as Porto Alegre.

PRESS & PUBLICATIONS       PRIVATE SECTOR      PROJECTS      RESEARCH & STATISTICS