Reference Document Nr. 2: Supporting Decentralisation and Local Governance in Third Countries

This document was drafted in January 2007. Although its content is for most part still valid, for up-to-date information on procedures and current thinking on the topic, please refer to (among others)  the Public group on Decentralisation, the group on Capacity Development and Technical cooperation and the Political economy in practice group.

This Reference Document should serve as a practical tool to help EC staff to better understand the ‘politics’ of decentralisation and local governance processes; to support the formulation and implementation of nationally and locally owned decentralisation policies; and to improve the coherence between the sector support being provided by the European Commission (e.g. in health or education) and ongoing decentralisation processes.

It should not be seen as a cookbook with well-tested recipes to be applied universally. The field of decentralisation does not lend itself to ‘one size- fits-all’ models. In many countries promising experiences are taking place, and the EC intends to develop a comprehensive policy framework to underpin its strategic support to decentralisation and local governance processes in a hugely varying set of country contexts.

This Reference Document therefore reflects ‘work in progress’.  In order to ensure its relevance for staff in the field, the Reference Document was elaborated in a highly participatory manner. Efforts were made to start the process from realities on the ground; the day-to-day concerns of staff in charge of managing programmes; as well as the emerging good practices. These ‘frontline actors’ were involved through a series of electronic Discussion-Group (‘D-Group’) consultations which fundamentally shaped the focus and content of the Paper. A brainstorming seminar was organised in Brussels with staff from eighteen EC Delegations from the various regions which helped to further refine and define future ‘homework’ for the EC in the area of decentralisation

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Table of contents

Acknowledgments

Abbreviations

Executive Summary

Why this Reference Document may be of interest to you…

Chapter 1: Why invest in decentralisation?

Chapter 2: Main concepts and the ‘open-systems’ approach

Chapter 3: Understanding the decentralisation arena

Chapter 4: Designing a coherent support strategy

Chapter 5: Implementing decentralisation support

Chapter 6: Assessing outcomes and impact

Chapter 7: Enabling the European Commission

Introducing this Reference Document 1

1 Why invest in decentralisation?

1.1 Why is decentralisation high on the development agenda?

1.2 What is different compared to previous attempts?

1.3 What are the opportunities and risks?

1.4 What support is the European Commission providing?

1.5 No shortage of strategic and operational questions

2 Main concepts and the ‘open-systems’ approach

2.1 Unpacking the decentralisation process

2.2 Dimensions of decentralisation and related concepts

2.2.1 Political decentralisation

2.2.2 Administrative decentralisation

2.2.3 Fiscal decentralisation

2.2.4 ‘Local government’

2.2.5 ‘Local governance’

2.2.6 ‘Local (economic) development’

2.2.7 ‘Territorial planning’ (aménagement du territoire)

2.3 Seeing the broader picture: Adopting an ‘open-systems’ perspective

2.4 Can decentralisation be considered a ‘sector’?

3 Understanding the decentralisation arena

3.1 A complex field

3.2 Decentralisation and changing lines of accountability

3.3 Civil society and decentralisation

3.4 Guiding principles for the design and implementation of support programmes

4 Designing a coherent support strategy

4.1 Programming

4.2 Identification

4.3 Formulation

4.4 Sector support programmes in a decentralised context (‘indirect support’)

4.4.1 Potential risks

4.4.2 Linking sector support with decentralisation

4.4.3 How can ‘classic’ sector programmes support decentralisation?

5 Implementing decentralisation support

5.1 Five key functions

5.2 Dialogue with partners

5.3 Monitoring

5.4 Coordination and harmonisation

5.5 Supporting implementation

5.6 Communicating and reporting

5.7 Open questions

6 Assessing outcomes and impact

6.1 Getting evidence: A complex job

6.2 Lessons from experience and innovative approaches

6.3 Challenges ahead

7 Enabling the European Commission

7.1 Capacity to act as a ‘change agent’

7.2 Capacity to ensure coordination, complementarity and coherence

7.3 Adapting management approaches, processes and procedures

7.4 Becoming a ‘learning organisation’

Annex

Annex 1: List of ongoing EC projects and programmes in support of decentralisation and local governance processes (December 2006)

Annex 2: Thematic note on gender in public administration reform and decentralisation

Annex 3: Assessing risks and opportunities with decentralisation

Annex 4: Some research findings on decentralisation effects

Annex 5: Diversity of entry points for EC support

Annex 6: Tools for political, institutional and organisational analysis

Annex 7: Capacity building in support of decentralisation

Annex 8: Financing Modalities and the Seven Key Assessments

Annex 9: Managing multi-actor and multi-level design processes

Annex 10: Performance indicators for sector budget support in Jordan, Honduras and Mali

Annex 11: Europeaid decentralisation indicators for reporting purposes [work in progress]

Literature

Useful resources on support to decentralisation and local governance