DECENTRALIZATION
- What is decentralization?
- Types of decentralization
- Forms of decentralization
- Overview of Ghana’s decentralization policy
- Relevance of decentralization
- Problems or challenges of decentralization
Decentralization Concept
The term "decentralization" embraces a variety of concepts which must be carefully analyzed in any particular country before determining if projects or programs should support reorganization of financial, administrative, or service delivery systems.
Different types of decentralization should be distinguished because they have different characteristics, policy implications, and conditions for success.
Definition
- Decentralization is the assignment of fiscal, political, and administrative responsibilities to lower levels of government (Litvack et al. 1991) in a prevalent but controversial institutional reform.
- According to L.C. Smith (1997) it refers to delegation or devolution of central state powers of policy making and decision taking to lower levels of government.
- Smith (1985) sees it as reversing the concentration of administration at the single center and conferring powers on local government.
It is the transfer of authority and responsibility for public functions from the central government to subordinate or quasi-independent government organizations and/or the private sector – It is a complex multifaceted concept.
Process by which a central government formally transfers powers to actors and institutions at lower levels in a political- administrative hierarchy.
It therefore involves the transfer of power, functions, means and competencies from central government to the sub-national structures.
What is the Purpose of Decentralization?
Failure of centralized systems to deliver efficiently
Decentralization has the potential to ensure a more equitable distribution of resources
It is part of the good governance/democratization agenda
It is supposed to engender popular participation in decision-making
Various Types of Decentralization
Various forms of decentralization have implications for delivery of water and sanitation services, as our experiences have indicated:
- De-concentration
- Delegation
- Privatization
- Devolution
Administrative Decentralization
Transfer of public service delivery functions from central government to local governments, field offices of MDAs, etc
Two main types:
- Delegation
- De-concentration
De-concentration
It refers to situations where the national government shifts some administrative power to its own ministry offices at the local level.
Delegation
is when the national government delegates administrative authority to ‘parastatal’ organizations at the local or regional level.
Privatization
Transfer of economic planning, production, distribution or other economic functions from government to voluntary, private or non-governmental institutions
Devolution
Transfer of political power from central government to lower-tier authorities. It is the ultimate form of political decentralization
Full transfer of resource mobilization and allocation responsibilities from central government to an quasi-autonomous, sub-national public authority that is fully independent of the devolving authority
Usually culminates in the establishment and empowerment of local governments that is accountable to the local population.
Usually involves the establishment of a legal and regulatory framework
Devolution refers to national governments handing over administrative authority to legally recognized, geographically identifiable units of local government with their own elections.
TYPES: Fiscal Decentralisation:
Financial responsibility is a core component of decentralization.
If local governments and private organizations are to carry out decentralized functions effectively, they must have an adequate level of revenues –either raised locally or transferred from the central government– as well as the authority to make decisions about expenditures.
The restructuring of existing systems of resource mobilization and allocation with the aim of empowering local government authorities to perform their decentralized functions
Fiscal Decentralization may include:
Formulas for transferring revenue to local governments;
Legally empowering local governments to collect and retain some taxes, fees, etc;
Legally empowering local governments to prepare their own budgets and disburse funds
It is a key ingredient for successful devolution.
Fiscal decentralization can take many forms, including:
self-financing or cost recovery through user charges,
Co-financing or co-production arrangements through which the users participate in providing services and infrastructure through monetary or labor contributions;
expansion of local revenues through property or sales taxes, or indirect charges;
intergovernmental transfers that shift general revenues from taxes collected by the central government to local governments for general or specific uses; and
Authorization of municipal borrowing and the mobilization of either national or local government resources through loan guarantees.
In many developing countries local governments or administrative units possess the legal authority to impose taxes, but the tax base is so weak and the dependence on central government subsidies so ingrained that no attempt is made to exercise that authority.
Political Decentralization
Political decentralization aims to give citizens or their elected representatives more power in public decision-making.
It is often associated with pluralistic politics and representative government, but it can also support democratization by giving citizens, or their representatives, more influence in the formulation and implementation of policies.
Advocates of political decentralization assume that decisions made with greater participation will be better informed and more relevant to diverse interests in society than those made only by national political authorities.
The concept implies that the selection of representatives from local electoral jurisdictions allows citizens to know better their political representatives and allows elected officials to know better the needs and desires of their constituents.
Political decentralization often requires constitutional or statutory reforms, the development of pluralistic political parties, the strengthening of legislatures, creation of local political units, and the encouragement of effective public interest groups.
Administrative Decentralization
Transfer of public service delivery functions from central government to local governments, field offices of MDAs, etc
Overview of Ghana’s Decentralization Policy
Re-demarcation of administrative jurisdictions (metropolitan areas, municipalities and districts)
Establishment of Metropolitan, Municipal and District Assemblies
Establishment of sub-district structures: Town/Area Councils, Unit Committees,
Restructuring of resource allocation & resource sharing b/n central & local governments
E.g. District Assemblies Common Fund, land rates and minerals royalties, grants, transfers, and external credits to local governments
Designating M.L.G.R.D as the agency responsible for implementation of the decentralization policy
Establishment of N.D.P.C to co-ordinate decentralized development planning
Establishment of structures and mechanisms to enhance probity, accountability and transparency in public administration at all levels of government
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