"reconstruction
must not be at the expense of transformation"
Workshop on
Decentralization and Local Development
Summary of Major Themes
Stockholm, Sweden 25-28 May 1999
Hurricane Mitch has highlighted the abilities and limitations
of municipalities and other local actors in Central America to act in the immediate
aftermath of a disaster and in the period of reconstruction. Local actors have mobilized a
remarkable effort following Mitch; however they were often forced to respond in an ad-hoc
fashion due to the inadequacy of both disaster preparation and internal capacities, and
the lack of financial resources. As a result, the Hurricane has also re-energized the
debate on decentralization as a factor in the region's reconstruction and long term
development.
As part of the Consultative Group Meeting on Reconstruction
and Transformation of Central America, a workshop was held to take stock of the status of
decentralization and local development on the region. Pierre Schori, Minister for
International Cooperation and Deputy Minister of Foreign Affairs of Sweden, presided over
the session. This summary represents a synthesis of the main issues discussed and actions
proposed.
Findings
- By definition, decentralization distributes power, resources,
decisions and capacities from central overnrrient to sub-national governments
(mainly municipalities) and communities. The potential benefits of this process are
related to the comparative advantages of local institutions: greater understanding of
local problems, better control and accountability during execution and operation of
projects, and better ability to involve the community and to mobilize their resources.
- Within the region, support for decentralization has reflected
general beliefs about its role in strengthening democracy, overcoming social imbalances
and improving the provision of services. But the form of the decentralization process in
each country reflects specific national conditions, policies and priorities.
- In order for decentralization to succeed, there must be
willingness on the part of central government to share power and on the part of local
governments and communities to assume new responsibilities
- Decentralization is a test of the commitment of national
governments to participatory democracy. To be relevant, the decentralization agenda has to
be defined by a large group of actors. While central -overnments play a key role in
defining and managing the decentralization process, the inclusion and support of civil
society and local governments is a condition for its credibility.
- Decentralization does not imply the weakening of central
governments. On the contrary, central governments are likely to be strengthened by the
decentralization process as they can better focus on national policy issues and central
functions.
- Local authorities and communities need assistance in
strengthening their capacity to fulfill decentralized functions. Capacity building of
sub-national governments needs to be a continuous and long-term investment, and will
require government and third-party support. Assistance may also be provided by a range of
support institutions.
- Smaller municipalities warrant special attention. Often
ill-prepared to tackle new and expanded responsibilities, they can often enhance their
effectiveness by associating with other municipalities to provide or contract services.
- At its best, decentralization does not simply transfer
centralized functions to the local level but simultaneously reorganizes the roles and
responsibilities of central government, local government and communities and opens
government processes to greater involvement by the people. The recent decentralization
experiences of social investment funds are positive steps in this direction.
- Decentralization raises a range of financial issues. Central
governments worry that decentralization can lead to an increase in public expenditure and
a reduction in tax collection. At the same time, local actors feel constrained by the
limited financial options available to them to carry out their obligations and functions.
- In a number of countries in the region there is no clear
agreement on the decentralization agenda or the process to be followed to achieve
objectives. This has led to conflicts due to differing expectations about the nature and
pace of the decentralization process. For example, concern exists about the level of input
invited from civil society and local governments into the development of the national
reconstruction plans following Mitch.
Suggestions for Action
In the course of discussions, participants identified the
following issues which may provide guidance to governments and donors in their support to
the decentralization process.
Lack of articulated strategy. In
each country, there is a need for a stronger and verifiable political commitment to
decentralization. This commitment should be' expressed in an articulated strategy,
operative tools and a detailed plan of action that includes a time schedule. The plan must
be the result of a collaborative process among central government. local governments and
civil society. The plan should include inter-institutional coordination mechanisms.
Need for monitoring systems.
Against this plan, a monitoring system with clear indicators of progress should be set up.
This monitoring system can be an important tool to be used by governments, donors and
civil society to review and adjust the decentralization process.
Reguirement for capacitv building.
Capacity building is critical to successful decentralization. Capacity building activities
should include professional development, training, technical assistance and educational
components, as well as the design of support systems. Decentralization can take place
simultaneously with capacity building and should not be postponed until capacity is built.
Maintaining sound fiscal management.
Governments must organize the decentralization process so that there is a correlation
between the transfer of responsibilities and financial resources, so that the process does
not undermine fiscal outcomes at either the national or local level.
Cooperation at the local level.
Smaller municipalities should be encouraged to work together to structure cooperative
arrangements that improve the cost-effectiveness and quality of public services.
Sustainability of local finances.
Governments must ensure that municipalities are financially sustainable and autonomous.
This requires policies, tools and mechanisms to allow professional and modem financial
practices (i.e., tax collection, management of indebtedness and budgets).
Institutional development requirements.
Resources should be committed to the development of institutions that support the
decentralization process. This may include governmental, private or non-governmental
financial intermediaries, training institutions and associations. The existing social
investment funds can be adapted to serve this role, but they should be encouraged to
deepen the decentralization of their project cycle management.
Local involvement in disaster prevention.
Because the burden of disaster prevention and response falls on local officials and
communities, participatory methods should be used to design decentralized disaster
prevention and response systems.
Local involvement in reconstruction and
transformation plans. Participation of local actors in the
implementation of reconstruction and transformation plans is key to their successful
implementation. Thus, it is important to involve local actors in project identification,
prioritysetting, execution, financing, supervision and/or maintenance. Bilateral and
multilateral development strategies and programs should be designed to encourage local
effort and to avoid a culture of long-term dependence on donor assistance.
Papers Presented in the Workshop
"Que Lecciones Nos ha Dejado El Mitch?," Jorge
Roberto Alfaro, Alvarado, Gerente, Instituto De Fomento Municipal, Guatemala. Mayo de
1999.
"Los roles
y relaciones entre los Fondos de Inversion Social, los Gobiemos Locales y la ciudadania en
Centroamerica." Patricia Durdn de Jager, Directora Ejecutiva, Federacion de
Municipios del Istmo Centroamericano (FEMICA), Guatemala. Mayo de 1997.
"The Roles and
Relationships of the Social Investment Funds, Local Governments and Communities in Central
America," Patricia Duran de Jager, Executive Director, Federacion de Municipios
del Istmo Centroamericano, (FEMICA), Guatemala. May, 1997
"Descentralizacion y Desarrollo Local en Centroamerica:
una mirada despuds del Huracan Mitch," Alfredo Stein, Nicaragua. Mayo de 1999.
"Retos de
la Implementacion de Descentralizacion en Honduras y el Rot de Entidades No Gubemamentales,"
Guadalupe Lopez R., Asociacion de Municipios de Honduras. Mayo de 1999.
"Decentralization
and Strengthening Of Local Government," The International Labour Organization in
collaboration with UNDP and HABITAT, Dr. Ian Chambers. Director, ILO Office for Central
America, Panama and the Dominican Republic. May, 1999.
"Descentralizacion
y Fortalecimiento del Gobierno Local," La Organizacion Intemacional del Trabajo
en colaboracion con el PNUD y HABITAT, Dr. Ian Chambers, Director, Oficina de la OIT para
America Central, Panama y Republica Dominicana. Mayo de 1999.
"Descentralizacion y Desarrollo Local en Centro America:
Que lecciones nos ha dejado el Huracan Mitch?," Dr. Jaime Castro, Asociacion de
Municipios de Nicaragua. Mayo de 1999.
"Municipalidades
en la Reconstruccion y Transformacion de Centroamerica y el Caribe," Sr. Mark
Schneider, Assistant Administrator for Latin America and the Caribbean, USAID. Mayo de
1999. (english)
"Descentralizacion para la Provision y el Mantenimiento
del Inversion Social," Sr. Carlos Lacayo, Technical Director, Emergency Social
Investment Fund (FISE), Nicaragua
Panelists
Mr. Pierre Schori. Minister, International Development
Cooperation, Sweden (Chairman)
Mr. Alfredo Stein, Consultant (Facilitator and presenter)
Mr. Otton Solis, Consultant (Rapporteur)
Mr. Mark Schneider, Assistant Administrator for Latin America and the Caribbean, US Agency
for International Development
Dr. Jaime Castro, Mayor, Municipality of Matagalpa and Member of the Board of Directors,
Nicaragua Association of Municipalities (AMUNIC)
Mr. Guadalupe Lopez Secretary, Honduras Association of Municipalities (AMHON)
Mr. Jorge Escotto, Subsecretary, Secretariat of Planning and Programming (SEGEPLAN),
Guatemala
Mr. Luis Castillo, Executive Director. Salvadoran Foundation for Integrated Support
(FUSAI)
Mrs. Vilma de Castellanos, Mayor, Tegucigalpa, Honduras
Mr. Carlos Lacavo, Technical Director, Emergency Social Investment Fund (FISE), Nicaragua
For more information on the workshop, contact
Mr. Lionel Nicol (lioneln@iadb.org)
Inter-American Development Bank
(202) 623-1079 |
