What are the challenges of decentralisation, what are its goals and dimensions, and what are the myths that surround it? These questions are examined in a paper from New York University. The article provides a broad overview of several ideas about decentralisation and tries to reach answers about the best way to implement and practice it.
The article does not claim to be prescriptive about decentralisation and states that it is not a monolithic concept that is inherently positive or negative. There are three fundamental dimensions of decentralisation; fiscal, institutional and political. Whilst the first two are critical, they alone cannot bring about the major goals of decentralisation without adequate political reform.
The majority of the advantages of decentralisation can be broadly captured as improved efficiency, governance and/or equity. These results are in turn often associated with economic development and poverty alleviation. There are, however, a number of myths and misconceptions surrounding decentralisation.
- Decentralisation can work under certain circumstances if it is properly designed and applied, but it is not a panacea for public sector ills. The same degree of decentralisation is not uniformly desirable across, or even within, countries or sectors.
- The idea that there are certain individual or collective prerequisites to decentralisation is misleading. Although institutional, political and fiscal mechanisms must be in place to sustain effective decentralisation, it may take some time to develop them.
- Although political will is important for decentralisation to succeed, it is not sufficient by itself. Reform may test the resolve of central agencies to accept a loss of power and resources.
- Reform may overwhelm weak local governments, or create opportunities for poor use of resources by freeing local officials from central control.
- There is a tendency to try and decentralise too quickly in complex institutional and political environments.
What are the challenges faced by decentralising reforms? One important challenge is to outline a pragmatic implementation strategy; most decentralisation efforts, even those with a relatively clearly defined and well co-ordinated system, have not met this challenge.
- A first challenge is to define an intergovernmental system that makes sense in the context of a particular country.
- National systems have evolved in different ways, so how to decentralise more genuinely and strategically cannot be mapped out in a uniform plan.
- Create mechanisms for coordinating activities of the multiple actors involved in decentralisation.
- Ensure that linkages between the key dimensions of decentralisation will be built.
- Ensure that education and incentives for behavioural change exist.
- A pragmatic implementation strategy will contain a general vision and reform framework, it will undertake the phases of decentralisation in a logical way. It will not try to do too much, too quickly.
