Democratic decentralisation programming handbook

This report provides an introduction to key concepts in decentralization, with a particular focus on decentralization’s essential characteristics: authority, autonomy, accountability, and capacity. It describes the primary dimensions and forms of decentralization; and the three major goals that countries often pursue through decentralization.

The report also looks at the major arenas in which USAID is likely to intervene. It provides guidance about how to assess the national, subnational, and civil society environment in a given country; and presents programming strategies that are targeted for each of these three arenas. It then describes how USAID can reliably evaluate the impacts of decentralization programs and learn from its experience.

Key findings:

The diversity of reforms labelled decentralization is nowhere more obvious than in the important distinction between deconcentration and devolution. While some reforms turn over managerial responsibility for certain functions to the subnational administrative units of central government agencies (deconcentration), other reforms completely reassign functions and revenues to autonomous subnational governments (devolution). In practice, most countries adopt some mix of these two decentralization extremes, and countries pursue the development of their particular mixes in varying ways and at varying paces. Decentralization is common in both federal and unitary countries.

The enthusiasm for decentralization that exists in the world today can be explained by the belief—common among donors, academics, and politicians of the left and right—that decentralization generates positive outcomes such as stability, democracy, and development. The causal connection between decentralization and these outcomes is mediated by the four intervening variables: authority, autonomy, accountability, and capacity. Stability, democracy, and development are the three goals most leaders cite when they decide to decentralize. But an important asymmetry characterizes these three common goals: the pursuit of democracy and development both depend on the prior achievement of stability. Consolidating democratic rule and making the right choices for long-term sustainable development are very difficult in an environment of chronic instability. If the primary objective of decentralization is to improve stability in politically fragile and crisis-plagued environments, then the provision of authority and autonomy (including corresponding resources) through deconcentration is, at least initially, the most critical requirement.

Decentralizing changes occur in three main dimensions. When decentralization is adopted in fragile states to enhance stability, it is the administrative dimension that will receive the most attention, commonly through the adoption of deconcentration. In contrast, using decentralization to deepen democracy will bring the political dimension to the fore, including reforms that make subnational politics more competitive, subnational representative bodies more effective, and subnational civil servants more responsive to subnational elected officials. The fiscal dimension of decentralization, including changes that improve subnational revenue generation and fiscal responsibility, will be especially critical where developmental goals are prominent.

Decentralization presents special obstacles and opportunities for the monitoring and evaluation (M&E) of programming activities. While M&E has previously focused on program implementation and output indicators, it will increasingly center on the measurement of actual impact of programming outcomes and on strategic objectives. Thus the first step in a successful M&E process is to define strategic objectives and outcome indicators. Once these have been defined, randomized evaluations provide the most effective strategy for M&E.