GOLD Report I - UCLG

AFRICA34 United Cities and Local Governmentsand the provision of goods and services foreducation, health, culture, leisure, transport,water and sanitation. Local responsibilitiesalso cover administration, urbanplanning and management, and local development.Successful decentralization depends on themanner in which power is transferred tolocal governments. Invariably, transfer ofauthority provokes resistance from managerswithin larger regional and nationalministries. In North Africa, transfer ofpower may be considered only nominal. Inthis region, national ministries typicallyThe ministries concerned tend to bypass local governmentsin implementing sectoral policies. They are encouragedto a greater or lesser extent in this by the practicesof development partners who are often in ignorance of theconsequences of applying such policiesretain control of local services, or delegatethem to the private sector. Sectors such aseducation and health are managed directlyby the corresponding ministries, whiledrinking water, sanitation and energy areeither state monopolies, or are provided byprivate concerns. In virtually all cases, theprivate providers are under contract to thestate, rather than to local authorities. Thistendency can also be observed in West andCentral Africa, although basic services therefor education, health, water, sanitationand transportation are generally acknowledgedas local concerns. Even so, theministries in this region also tend to bypasslocal governments in implementing longrangesectoral policies. The ministries areoften encouraged by their private partnersto minimize larger policy discussions withlocal authorities. It appears to be of smallconcern to private developers how theirpressure for increased central controlmight affect a national momentum towarddecentralization.Nevertheless, there are promising developmentsin several eastern and southernAfrican countries, as well as a few anglophonecountries in West Africa. In thesecountries, sectoral ministries are graduallydisengaging from the implementation phasesof their programs. The result: localgovernments are taking over the localdepartments that previously came underthe territorial jurisdiction of sectoral ministries.This transfer of authority, seen inGhana, South Africa and Uganda, necessitateschanges in staff, budget resources,assets, and decision-making power. In thesecountries, central government definesstrategic guidelines for sectoral policiesregarding health, water and education.Local governments, however, are responsiblefor implementation. Wherever suchterritory-wide measures have been undertaken,as in the case of water andHIV/AIDS policy in Uganda, the effectivenessof these policies has increased substantially.However, the decentralizationprocess is often hindered by national sector-basedpolicies that tend to privilegedeconcentration (limited transfer of responsibilities).One of the recurrent claimsof African local authorities is that sectorbasedpolicies should be territorialized andthus more decentralized, as in Ghana,Uganda or South Africa, and that localauthorities should be fully responsible fortheir implementation.While public assertion of the new nominalpowers of local governments is widespread,the actual transfer of real executive and operationalpowers is still rare. The challengeremains to resolve the problem of effectivelytransferring the real financial and managerialpowers from the centralized ministries tolocal authorities. Financial management is,of course, the crucial factor.III.2. Financial managementLocal government finance comes from twomain sources –local taxes and state grants.In some places, local governments sharelocal tax revenues with the central government.The state also makes financial transfersto local governments in the form of