Transcript Document 7229996
Intergovernmental Aspects of Service Delivery
Public Expenditure for Human Development Course
Dana Weist PRMPS 12 November 2003
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Key Service Delivery Questions
• Who is doing what? • How is it being financed?
Answers to these questions often determine the equity, efficiency, and accountabilities of service delivery Page ‹#›
Who is Responsible for What?
• Who – determines policy?
– produces services?
– finances? – regulates, enforces, monitors, and evaluates?
• Public versus private sectors?
• Which tier of the public sector?
– Central or local government production – Contracting with other governments, private sector, community groups Page ‹#›
How is it Being Financed?
• Budget allocations • Government transfers/grants • Local taxes/charges/fees • Community charges/fees Page ‹#›
Dilemma: Clinics Lack Medicine or Schools Lack Textbooks
• What does the intergovernmental system have to do with it?
– Discrepancy between responsibility and financing: Local government responsible for providing services without resources – Insufficient funds: weak central or local revenue mobilization – Cash flow: Central Government slow to release needed funds – Weak budgeting: inability to forecast realistic costs – Leakage: corruption/malfeasance Page ‹#›
Decentralization: A World-Wide Phenomenon
• Underway in over 85 countries • Political and economic rationales • Varieties – Deconcentration – Delegation – Devolution Page ‹#›
Positive or Negative Outcomes?
• If designed well, decentralization can: – Move decision making closer to people – Enhance efficiency and responsiveness of service delivery – Potential tool to alleviate poverty • But, design is complicated, since it spans fiscal, political, and administrative policies and institutions • Design + Accountability + Capacity Page ‹#›
Four Pillars of Intergovernmental Fiscal System
• Expenditures • Revenues • Intergovernmental transfers • Subnational borrowing/debt Page ‹#›
Expenditure Design Determines Impact
• Expenditures = government services • Design affects availability, quality, access and appropriate use of public services e.g. health, education, water, roads etc.
• Can ultimately affect macroeconomic stability Page ‹#›
Efficiency
• Considerations for assignment: public goods, externalities, subsidiarity, economies of scale, public sector competition – Ultimately, no single best assignment – Ideally, services should be provided at lowest level of government where benefits lie • • Public provision doesn’t imply public production
Clarity
is critically important • Do local services respond to local needs? – Do citizens have meaningful opportunities for voice? – Do officials face incentives to respond?
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Decentralization of Functions
• Organization • Planning • Personnel • Infrastructure • Resources • Regulation Page ‹#›
Local Revenue Mobilization
• Resources often inadequate to carry out assigned functions • Simplest and most effective form of tax autonomy: discretion to set tax
rates
• Striking variations in size and capacity – one size doesn’t fit all • Mix of local revenues needed • Local revenue mobilization strengthens accountability Page ‹#›
Rationales for Intergovernmental Transfers
• Vertical imbalances • Horizontal imbalances (equalization) • Externalities (inter-jurisdictional spillovers) • Enhancing national objectives at the subnational level • Paying for national programs implemented by subnational governments Page ‹#›
A “Good” Transfer System
• • • Transfers should be transparent and predictable (formula-based) – – – – Equalization transfers should include A measure of “need” A measure of “capacity” Adequate sub-national revenue autonomy Stable but flexible financing Avoid a proliferation of conditional grants Page ‹#›
Changing Central Roles and Functions
• • Change role from “command and control” to policy guidance and facilitation – – – – “Steer the course rather than rowing the boat” Establish government’s policy framework Structure proper incentives for local governments
Stop
delivering most public services Central government plays a central role – – – – Legal and regulatory frameworks Coordination mechanisms Accurate, timely and comprehensive information Capacity building programs Page ‹#›
Setting Standards
• Central government plays coordinating role – – Ensures compatibility and consistent quality Enables various service delivery arrangements • Fine balance: standards that are too restrictive can reduce efficiency or increase service delivery costs • Establish
incentives for performance
compliance with national objectives to ensure • Central government should not use un-funded mandates to compel local government behavior Page ‹#›
•
Prerequisites for Local Accountability
Citizens leaders can assess performance of their • Citizens participate and express their views on local decisions • Civic and private partners are involved in service delivery Page ‹#›
Strengthening Accountability
• • • Participatory approaches – – – – Elected councils Locally appointed officers Participatory budgeting and planning Local civic forums Fiscal responsibilities – Local tax collections – Discretion in budget allocations Accountability to central government – – Reporting on outcomes Financial disclosure and reporting Page ‹#›
Strengthening Citizen Feedback
• • • • Surveys Citizen report cards Issue-specific,
ad hoc
councils Citizen participation in implementing decentralized programs Page ‹#›