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Two sides to a hot issue

When citizens in the Ecuadorian municipality of Cuenca, in the Andean highlands, began taking a stronger role in government decision making several years ago, it was both an innovation and the continuation of a tradition that stretches back thousands of years.

Ecuador’s indigenous peoples have managed resources collectively for millennia. Today, Cuenca Mayor Fernando Cordero Cuevas is adapting that tradition to help solve municipal budget problems

As Cuenca Mayor Fernando Cordero Cuevas explains, the communal traditions of participation, known as the minga in the indigenous Quechua language, date back to long before the time of the Incas. Today, under Cordero’s leadership, the process in which popular assemblies and their representatives establish and analyze the budget and declare priorities has put the municipality of 420,000 persons in the vanguard of the movement in Latin America to increase local participation in decision making.

Although cities are generally the leaders in social organization, such has not been the case in Cuenca, according to Cordero. In the municipality’s 21 rural parishes, people participate more actively in the popular assemblies than do citizens in urban parishes. The reason, he said, is that “rural people live more in community.”

In one of his first moves after coming to office, Cordero revamped the parish councils. Formerly their members had been appointed by the mayor. Now they are elective offices that supplement the City Council. Parish councils have been charged with identifying public works projects, setting priorities, meeting with city technical experts to make sure that the projects are viable, requesting technical studies and budget preparations, monitoring execution of the works and evaluating the results. Projects include schools, health, roads, parks and community centers. The rural parishes are also completing 20-year strategic development plans.

Cuenca’s participatory budgeting is based on a local law that regulates the voting and membership for the parish juntas. In Brazil’s Porto Alegre, the participatory system works without a special law.

As did other municipalities, Cuenca instituted participatory budgeting simultaneously with fiscal reform measures. The first step was to bring the cadastre, or tax roster, up-to-date. The city went about the job very meticulously, going “building by building,” says Cordero.

Cuenca’s fiscal reform received a boost from a change in the Ecuadorian constitution that gives municipalities the exclusive right to determine how to spend revenue from a special tax levied on buildings or neighborhoods for improvements. Under the Cuenca system, taxpayers that directly benefit from a public work pay a larger share of its cost. According to Cordero, payments on loans to finance works paid for by this “improvements tax” are up-to-date because citizens know that early remissions will lower interest rates, and hence their taxes.

Another part of the fiscal reform process consisted of reorganizing public services, such as telecommunications and sanitation, which had been a drain on the treasury. These were taken out of the hands of the municipal bureaucracy and converted into autonomous enterprises. Although popular assemblies are held to review the rates these enterprises charge, citizens understand that the services must earn enough money to function on a sustainable basis, Cordero says.

—Daniel Drosdoff

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