The draft 12th Five Year Plan (FYP) has seen a doubling of capital budget resources for the local government from Nu 25 bn in the 11th FYP to Nu 50 bn in the 12th FYP.
One of the key aims of the 12th FYP is to enhance and empower local governments. The final guidelines of the 12th FYP approved by the cabinet says that in keeping with the government’s decentralization efforts, greater responsibility and resources are being shifted from the center to the local governments.
Given that the local government will be getting more budget and responsibility in the 12th plan the government is bringing about a decentralization policy to help strengthen not only the capacity but also the accountability of the local government.
Another key aim of the policy is to ensure better local awareness and participation of the local people in their local governments.
The decentralization policy which is currently in the draft stage has been sent to the Gross National Happiness Commission for review by the Ministry of Home and Cultural Affairs.
In 2016, the Prime Minister had directed the Home Ministry to study and submit a proposal to achieve the initiative of fiscal decentralization introduced in 2008/2009, 2013 and 2016 in the form of annual capital grants, and capacity development of the Human Resource respectively in the Local Governments.
The National Council after an LG Assessment Study in 2016 also recommended to the Ministry of Home & Cultural Affairs to develop a consolidated National Decentralization Policy – that would enable the government to formulate a clearer pathway and future direction of decentralization in the country
The main objective of the Policy is to deepen and sustain grassroots-based democratic, accountable and equitable development and governance system by enhancing citizen participation and strengthening the local governments, while maintaining effective, functional and mutually accountable linkages between central and local governments.
The policy aims to strengthen good governance through determining a clear system for accountability, transparency and participation in the overall framework of decentralized approach.
It looks to develop a framework to promote fiscal decentralization.
It will aim to to ensure effective participation of citizens for sustainability and ownership of development infrastructure and services.
It will clearly define the functional roles, responsibilities, accountability and authority of LGs and communities with respect to development plans and programs.
The policy will determine a clear pathway for strengthening the capacity of Local Governments, including authority for the Local Governments over Human Resource.
It will adopt a proper coordination mechanism among the stakeholders for effective and efficient implementation of plans and programs.
Issues to be dealt with
The concept note on the policy identifies current weaknesses too. One of them is inter-agency coordination. It says turf protection continues to remain a challenge. There is inadequate coordination of public sector institutions, resulting in duplication of effort and inadequate provision of services to citizens.
Another problem is a ‘One-size-fits-all’ policy approach. It says the prevailing practice for allocation of Human Resources, budgets, etc. not taking into account the local context in terms of population, development status, has at times yielded undesirable outcomes.
It identifies weak LG information management systems saying that at present, most plans of the Local Governments are not backed by information and it leads to loose interpretation.
A problem is the the low and weakening community or citizens’ participation. This, the policy says is largely because there is weak critical awareness of the citizens on the importance of their participation for their own betterment.
Inadequacy of capacity and resources is also identified as an issue to be solved.
All of these are drawbacks are in the absence of a consolidated national strategy for implementation of decentralized plans and programs according to the policy note.
It says to ensure effective oversight role for decentralization processes, there is a need for developing strategic implementation mechanisms, which is currently non-existent.
The note says that the proposed policy should, among others, provide clear strategic way forward for decentralization, which, at the moment, is disjointed and sector-specific.
The need for such policy is to empower local governments to exercise control over their local affairs through decentralization of powers and authority.
It says that in order to streamline decentralization, it is necessary to transfer authority, functions and responsibilities with matching transfer of financial and human resources.
Key policy recommendations proposed in Decentralization Guidelines 1993, Bhutan 2020, and the Local Governance Assessment Study Report 2016 (key findings and recommendations attached for information) will also be integrated into the proposed Decentralization Policy.
The note says that with increasing devolution of powers and functions to the LGs, there is a need for such a policy to facilitate the vitalization of relevant legal frameworks to strengthen the LG systems and structures for efficient and effective delivery of public services.
The government, it says, must put in place an adequate measure of citizens’ participation to enable citizens to actively participate in their local governance affairs and service delivery activities, and take responsibility for their own development.
It says that local leaders should in turn also be able to ensure that citizens have access to information on services and respond to citizens’ needs.
The government, it says, should foster a proper mechanism to allocate (plan) budgetary resources and develop framework for fiscal decentralization.
The note says that crosscutting issues, at the moment, are driven by specific sectors/agencies. However, the Government putting in place an overarching policy that encapsulates all these crosscutting issues will provide a common, funneled direction for implementation.
Putting in place this policy will also mean the government is well-informed of these cross-cutting issues and takes ownership of them through endorsement of the policy according to the note.
It points out that having this policy will lead to political stability which will be secured by active participation of the citizens in matters affecting their lives and it will also build political leadership at the community level.
It says accountability of the government will be enhanced because of its close proximity to the local populace and constant scrutiny.
According to the note, responsiveness of the government will be improved because local representatives will be best placed to know the exact nature of the local needs and how they can be met in a cost effective way.
Another benefit is that local specific plans will be tailor-made for the communities using detailed and latest information.
It says that there will be higher motivation with enhanced responsibility. Likewise, once the awareness or implementation of programs on cross-cutting issues reach out to the grass-roots through this policy, there will be better ownership of these issues and this, the note says, could have huge positive impact in the long run.