A PARTICIPATORY BUDGETING MODEL FOR CANADIAN...

A PARTICIPATORY BUDGETING MODEL FOR CANADIAN CITIES

By

Hendrik T. Nieuwland, B.Sc., M.Sc. (McMaster), M.P.A. (Queen’s)

[email protected], [email protected]

© Copyright by Hendrik T. Nieuwland, July 2003

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Abstract The quality of representation in Canadian governing structures is currently inadequate.

Low voter-turnout and the failure of pluralism have created an imbalance in James Fishkin’s four dynamic conditions of democracy – political equality, participation, deliberation and non-tyranny. In this paper, participatory budgeting (PB), a Latin American innovation, was proposed as one potential mechanism to help remedy this imbalance. This is accomplished by increasing citizen participation in deliberations on issues of local importance (within a structure of political equality and non-tyranny), and empowering citizens to make real decisions on how to address such issues. PB is a co-determinative participatory system that allocates control of a portion of a city’s budget to local citizens. Using these resources, citizens, with the aid of elected representatives and the civil service, decide the type and form of projects and services that will be undertaken by the city to meet identified local needs. At the time of writing there were two known PB models in the world. The first model was developed and implemented in the city of Porto Alegre, Brazil, and is currently being used in many other Brazilian cities. The use of PB in Porto Alegre has been shown to bring numerous benefits to the city and its citizens. Corruption, clientelism and economic inefficiency has been reduced, while local democracy, citizenship values, public works and quality of life have advanced. The second model is a hypothetical PB process designed for the city of Salford, England. A critical analysis of both models found certain common and valuable systems which should be incorporated into a Canadian PB model. However both models utilized native systems that are not compatible with the unique cultural and democratic realities of Canadian cities. Drawing on the strengths, while avoiding the weaknesses, of the two established PB models, a new Canadian PB model was developed, employing a novel citizen decision-making system called the Deliberative Budget Council.

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Table of Contents Abstract _____________________________________________________________________ ii Chapter 1_____________________________________________________________________1

1. Towards Improving Representative Democracy in Canada _____________________________ 1 1.1. Defining Democracy: A “Dynamic Balance” ______________________________________________1 1.2. The Contemporary Model: Representative Democracy _____________________________________3 1.3. Criticisms of Representative Democracy _________________________________________________4

1.3.1. Voting __________________________________________________________________________4 1.3.2. Pluralism________________________________________________________________________6

1.4. Participatory Reforms: A Means To Improve Representation? ______________________________8 1.4.1. Participatory Democracy Improves Citizenship__________________________________________8 1.4.2. Participatory Democracy Improves Decision-Making _____________________________________9 1.4.3. Criticisms of Participatory Democracy _______________________________________________10

1.5. Cities: The Ideal Venue For Experiments In Participatory Democracy _______________________10 Chapter 2____________________________________________________________________12

2. Participatory Budgeting in Porto Alegre, Brazil _____________________________________ 12 2.1. A Short History of Port Alegre, Brazil __________________________________________________12 2.2. The Participatory Budgeting Process ___________________________________________________13

2.2.1. Sizeable Participation in the Participatory Budget Process________________________________18 2.2.2. Participatory Budgeting Produces Significant Social and Political Results ___________________19

2.3. Criticisms of the Participatory Budgeting Process ________________________________________20 2.3.1. Patronage in Participatory Budget Decision-Making Process______________________________20 2.3.2. The Participatory Budget Process Usurps the Power of the Chamber of Deputies ______________20 2.3.3. Rubber-stamping Government Initiatives at Thematic Meetings ____________________________21 2.3.4. The “Too-Many-Meetings” Problem _________________________________________________22 2.3.5. Popular Movement Co-option_______________________________________________________22 2.3.6. Fragmentation of the Popular Movement______________________________________________23 2.3.7. Participatory Budgeting Is Not Sustainable During Times of Fiscal Restraint _________________23 2.3.8. Decentralization Will Diminish Budget Control, Efficiency and Planning_____________________23

2.4. Conclusions ________________________________________________________________________24 Chapter 3____________________________________________________________________25

3. The Salford Budget Matrix Study _________________________________________________ 25 3.1. Overview of the Salford PB Model _____________________________________________________25 3.2. The Salford Budget Matrix System_____________________________________________________27 3.3. Critical Analysis of the Salford Budget Matrix Study______________________________________29

3.3.1. Geographical Boundary Selection ___________________________________________________29 3.3.2. Unclear Priority Identification ______________________________________________________30 3.3.3. Unfair Budget Matrix Weighting Mechanisms __________________________________________30 3.3.4. Investment Fund Inefficiency _______________________________________________________31

3.4. Conclusions ________________________________________________________________________32 Chapter 4____________________________________________________________________33

4. A Participatory Budget Model for Canadian Cities __________________________________ 33 4.1. Participatory Budgeting in Canada ____________________________________________________33

4.1.1. Conditions Required to Successfully Implement Participatory Budgeting _____________________33 4.1.2. Canadian Participatory Budgeting Challenges _________________________________________35

4.2. A Canadian Participatory Budgeting Model _____________________________________________36 4.2.1. Phase 1 – Preparation and Mobilization (January-April) _________________________________37 4.2.2. Phase 2 – District PB Meeting (May/June) ____________________________________________39 4.2.3. Phase 3 – Budget Matrix and Project Development (May-September) _______________________39

4.2.3.1. The Budget Matrix (May/June)__________________________________________________39

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4.2.3.2. Project Development (July-September) ___________________________________________42 4.2.4. Phase 4 – Debriefing and Community Committee Establishment (October/November)___________42 4.2.5. Phase 5 – Deliberative Budget Council (DBC) Proceedings (November/December) ____________42

4.2.5.1. The DBC Must Be Representative of the Population _________________________________44 4.2.5.2. There Must Be an Incentive to Participate in the DBC ________________________________44 4.2.5.3. DBC Deliberations Must Influence Participants’ Decisions ____________________________45

4.2.6. Phase 6: Implementation and Oversight (Next Fiscal Year)________________________________46 4.3. Conclusion _________________________________________________________________________46

Bibliography _________________________________________________________________47

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Figures and Tables Figure 2-1: The Participatory Budget Cycle in Porto Alegre, Brazil ____________________________________ 15

Figure 3-1: Service Delivery Areas: City of Salford, England _________________________________________ 28

Figure 4-1: Overview of Proposed Canadian PB Model ______________________________________________ 40 Table 2-1: Delegate Selection Criteria ____________________________________________________________15 Table 2-2: Grading of General Criteria ____________________________________________________________17 Table 2-3: General Criteria For Distribution of Investment Resources____________________________________17 Table 3-1: Salford Budget Matrix: Local and City-Wide Priorities ______________________________________27 Table 3-2: Salford Budget Matrix________________________________________________________________28 Table 3-3: Salford Budget Matrix Area Allocations for “Valuing Children and Young People” ________________29 Table 4-1: Proposed Themes for the City of Kingston ________________________________________________39 Table 4-2: Examples of Budget Matrix Criteria _____________________________________________________40 Table 4-3: Hypothetical Table Outlining Kingston District ____________________________________________41 Table 4-4: Hypothetical Budget Matrix District Allocations For “Roads” Theme ___________________________42

Chapter 1 Towards Improving Representative Democracy

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Chapter 1 1. Towards Improving Representative Democracy in Canada

Indian author and activist Arundhati Roy has critically commented on the promiscuous use of the word “democracy” today:

Democracy, the modern world's holy cow, is in crisis. And the crisis is a profound one. Every kind of outrage is being committed in the name of democracy. It has become little more than a hollow word, a pretty shell, emptied of all content or meaning. It can be whatever you want it to be. Democracy is the Free World's whore, willing to dress up, dress down, willing to satisfy a whole range of taste, available to be used and abused at will.1

Democracy, it would appear, is in the midst of a metaphorical identity crisis. As Western advocates of all political stripes expound the merits of democracy and confidently encourage its spread across the globe, one could imagine “Democracy”, if Roy is correct, nervously chain-smoking, supine on a leather couch, prodding its shrink with questions of “What am I? What do I mean?” Those who are interested in improving contemporary forms of democracy must first strive to answer these questions – to give meaning back to the “hollow word”. It is to this challenge we now turn. 1.1. Defining Democracy: A “Dynamic Balance”

What is democracy? The original, or classical, democratic theorists defined democracy as a system where each individual citizen was involved in political decision-making.2 However they did not envision democracy as merely a new method of ensuring good government, but also as a system which can help develop the full human potential of its participants. Jean-Jacques Rousseau, the quintessential classical democratic theorist, felt that direct participation in a democracy was the ultimate exercise of freedom (which he defined as “obedience to a law one prescribes to oneself.”3). Intimately tied to his notion of ‘freedom’ is that of ‘control’. Carol Pateman argues that Rousseau felt freedom required “control over the course of his life and the structure of his environment. …freedom requires that he should exercise a fair measure of control over those that execute the laws and over representatives if an indirect system is necessary.”4 One can conclude that in the classical democratic world-view, the exercise of freedom (or control) is intimately linked to the development of each citizen’s potential. In the words of Lane Davis, the major purpose of democracy was “the education of an entire people to the point where their intellectual, emotional, and moral capacities have reached their full potential and they are joined, freely and actively, in a genuine community.”5

Rousseau’s theory of democracy was developed before the rise of the modern nation-state, the advent of representative democracy and the resultant transfer of majority control over decision-making to representatives. The modern dilemma, therefore, is the means by which

1 Arundhati Roy, “Instant-Mix Imperial Democracy (Buy One, Get One Free)” Common Dreams News Center (18 May 2003), online: CommonDreams.org <http://www.commondreams.org/views03/0518-01.htm>. 2 Carol Pateman, Participation And Democratic Theory (Cambridge: Cambridge University Press, 1970) at 22. 3 Jean-Jacques Rousseau, The Social Contract, trans. By Maurice Cranston (Penguin Books, 1968) bk. I, ch. 7 at 64. 4 Supra note 2 at 26 ¶ 1. 5 Lane Davis, “The Cost of Realism: Contemporary Restatements of Democracy” (1964) 17 Western Political Quarterly 37 at 40 ¶ 4.


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democracy, as a system, ensures both the exercise of freedom (and thus the full development of the citizen) and good government. Consequently, the definition of a “democracy” must reflect the rise of representation. James Fishkin identifies a modern democracy as a system which meets four conditions:

1. Political equality: citizens’ preferences count equally in a process that can plausibly be

viewed as representative of everyone. 2. Deliberation: a wide range of competing arguments is given careful consideration in

small-group, face-to-face discussion. 3. Participation: a significant proportion of the citizenry is engaged in the process. 4. Non-tyranny: the political process avoids, whenever possible, depriving any portion of the

citizenry of rights or essential interests. Even when the process is democratic in all other senses just defined, it must avoid the ‘tyranny of the majority.’6 It is immediately clear that there is some flexibility, or dynamism, in the conditions. For

example, the number and type of “competing arguments” heard, and the time given to their “consideration” during deliberations is not specified. A system which hears every possible argument but is forced by constraints to limit the time spent considering them would be very different from a system which hears some arguments and spends more time considering their quality – however both systems, all other conditions being equal, could be considered democracies. Likewise, concerning participation, it is not clear what is meant by a “significant proportion of the citizenry.” One could also envision two democracies which vary in the degree of citizen participation. It is also important to realize that these four conditions are interdependent. Changes in one condition influence and infringe on other conditions. It is easy to imagine the quality of federal deliberation diminishing in Canada if all thirty million citizens attempted to participate in every decision. Similarly, Joseph Schumpeter, in his classic hypothetical, explains how a tyranny of the majority can violently infringe upon political equality:

Let us transport ourselves into a hypothetical country, that, in a democratic way, practices the persecution of Christians, the burning of witches, and the slaughtering of Jews. We should certainly not approve of these practices on the ground that they have been decided on according to the rules of democratic procedure.7

Peter Bachrach has rightly criticized Schumpeter’s conjecture that a tyranny of the

majority is consistent with “the rules of democratic procedure”, since “(r)eligious, racial, or group persecution of any sort is in conflict with the principles of freedom of discussion and association [i.e. the condition of political equality]…(hence) mob rule and majority tyranny are outrages against both democracy and individual liberty.”8 Schumpeter’s error notwithstanding, the lesson of his hypothetical example, made clear by Bachrach, is consistent with the assertion made here that the breach of any democratic condition is inconsistent with classifying a system which perpetrates the violation as a democracy.

6 James S. Fishkin, The Voice of the People: Public Opinion and Democracy (New Haven, Conn.: Yale University Press, 1995) at 34 ¶ 3. 7 Joseph Schumpeter, Capitalism, Socialism and Democracy (New York: Harper and Row, 1942) at 242-3. 8 Peter Bachrach, The Theory of Democratic Elitism: A Critique (Boston: Little, Brown and Company, 1967) at 19-20.


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The democratic framework in which this paper will operate can therefore be summarized as follows: a democracy is a dynamic system which attempts to balance the following four conditions – political equality, deliberation, participation and non-tyranny. The quality of a democratic system can therefore be determined by assessing the means through which this balance is or is not achieved. 1.2. The Contemporary Model: Representative Democracy

In his book, The Voice of the People, Fishkin asked what is now the $1 million (and 2,500 year-old) question: “How can we achieve a democracy of engaged citizens, a democracy of face-to-face discussion, in states [and cities] that contain many thousands or even many millions of people (emphasis included).”9 Classical theorists of democracy argue the merits of direct democracy, such as the Assembly in the ancient city-state of Athens10 or the New England town hall meetings in the United States, where the citizenry directly engaged in decision-making affecting the polis. However, Robert Dahl argues that true direct democracy, in the classical sense, has become impracticable in modern times:

The essential point is that nothing can overcome the dismal fact that as the number of citizens increases the proportion who can participate directly in discussions with their top leaders must necessarily grow smaller and smaller. The inherent constraint is neither evil men nor evil institutions, nor any other eradicable aspect of human life, but rather a dimension of all existence that is morally neutral, because it is implacable, unswerving, and inescapable – time.11 (emphasis added)

Even Rousseau recognized this limitation, saying, “If there were a people of gods, they

would govern themselves democratically. A government so perfect is not suited to men.”12 The Athenians addressed the “time-problem” through random selection by lot. Five hundred citizens were selected to legislative commissions, and seven hundred were randomly assigned to other public service posts. There was also random selection for the Council, which set the agenda for the Athenian Assembly, where issues of public importance were debated. 13 As already mentioned, contemporary systems all utilize citizen-elected representatives as a means to address the “time-problem”. Both the Athenian and contemporary representative institutions “identif(y) groups of manageable size who could gather, deliberate on the issues face to face, and speak for the entire citizenry.”14 The engagement of citizens in the democratic process in a representative system is limited to the selection of competing elites by voting, and through participation in interest group lobbying of elected officials, what is called the pluralist model.15 Citizens, it is argued, therefore exercise indirect control of their government, rather than the direct control called for by classical theorists, since, at least in theory, “elected officials keep the real or

9 Supra note 6 at 18 ¶ 2. 10 It is important to note that the Athenian Assembly was not a ‘pure’ direct democracy. The Assembly at the Pnyx seated 6,000 citizens, whereas the total population of Athens at the time ranged from 30,000 to 60,000 citizens; Ibid. at 18. 11 Robert Dahl, “The City in the Future of Democracy” in Terrence E. Cook and Patrick M. Morgan, eds., Participatory Democracy (San Francisco: Canfield Press, 1971) at 93 ¶ 3. 12 Jean-Jacques Rousseau, Du Contrat Social (Paris, Editions Garnier Freres, 1962) at 280. 13 Supra note 6 at 18-20. 14 Ibid. at 20 ¶ 2. 15 George Perlin, The Democratic Citizen: Canadian Democracy in Critical Perspective (Toronto and Kingston: CBC Newsworld and Queen’s University, 2002).


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imagined preferences of constituents constantly in mind in deciding what policies to accept or reject.”16

This paper will not consider the theoretical question of whether there should be representation or whether democracy would be best served by returning to the direct, classical form. For the purposes of the present work it is conceded that representative institutions are likely here to stay. The analysis therefore becomes two-fold: first, assess the quality of representation in the context of the democratic framework outlined above; second, if a deficiency is found, suggest reforms that could help remedy the defect. We now move to the first part of this analysis. 1.3. Criticisms of Representative Democracy

There have been numerous criticisms of modern representative institutions and the pluralist system that supports it. These include general claims of corruption against representatives17, the inability to adequately respond to citizen demands, and the concentration of political power to various elites, leading to the general disempowerment and apathy of citizens.18 The foundation of a representative democracy, as noted above, rests upon the vote and pluralism. Keeping in mind the criticisms already mentioned, the current state of voting and pluralism will be analyzed. 1.3.1. Voting In a representative democracy, the exercise of voting contributes directly to two conditions, namely political equality and participation, in the democratic framework outlined above. If a “significant proportion” of the citizenry engage in voting, it could be argued that “citizens’ preferences count equally in a process that can plausibly be viewed as representative of everyone.” Indeed, in the words of George Perlin, “If democracy is to work it is essential that citizens vote.”19 An analysis of voting patterns can therefore shed light on the quality of representation in Canadian democratic institutions. The results of studies of Canadian voting patterns is not encouraging. Voter turnout for federal elections has dropped steadily from a high of 77 percent in 1972 to a low of 61 percent in the most recent election of 2000 (the lowest turnout of any election in 73 years). Turnout in provincial elections vary from province to province, but have ranged from 47 to 88 percent over the last 20 years.20 In Canada’s most populous province of Ontario, voter turnout has averaged 61 percent over the same time period.21 Turnout for municipal elections is generally worse at less than 50 percent.22 To cite a specific example, in the city of Kingston, Ontario, average voter

16 Robert Dahl, Who Governs? (London: Yale University Press, 1961) at 164 ¶ 2. 17 “Representatives of the people are hard to deceive, but easy to corrupt; and it rarely happens that they are not so corrupted.” Jean-Jacques Rousseau, “The Social Contract (III, XV) and Poland (VII)” in Terrence E. Cook and Patrick M. Morgan, eds., Participatory Democracy (San Francisco: Canfield Press, 1971) at 118 ¶ 3. 18 Some contemporary democratic theorists argue that citizen apathy is essential for the stability of democracy. See Bernard Berelson et al., Voting (Chicago: University of Chicago Press, 1954) and Seymour Martin Lipset, Political Man, 2nd ed. (London: Heinemann, 1983). This argument has been challenged by other theorists; see especially Peter Bachrach, supra note 8. 19 Supra note 15. 20 Ibid. 21 “Statistics from the Records”, online: Elections Ontario <http://www.electionsontario.on.ca/en/Results_and_Stats_en.shtml >. 22 Joseph Kushner, David Siegal and Hannah Stanwick, “Ontario Municipal Elections: Voting Trends and Determinants of Electoral Success in a Canadian Province” (1997) 21 Canadian Journal of Political Science 539 at 542; for specific numbers on voter turnout in major Canadian cities see George Perlin, supra note 15.


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turnout ranged from 35 to 43 percent (for all 12 districts and for Mayor) over the last three municipal elections (1994, 1997, 2000); the number of eligible voters who actually voted for the eventual winner were much lower, ranging from 18 to 23 percent.23 It is therefore difficult to justify labeling an election victory as a ‘mandate’ endorsing the winners’ policy objectives as representing the ‘will of the people.’24 There are numerous theories which try to explain this drop in voter participation. Some argue that it is a product of Canada’s ‘first-past-the-post’ electoral system which, since it requires a candidate only receive a plurality to win, has led to distortions in election outcomes that discourage citizens from voting. There are numerous examples of such distortions. In the 2000 federal election, the Liberal Party received twice as many votes as the Canadian Alliance in the Province of Ontario but received fifty times the number of seats.25 In the 1988 election, the Progressive Conservative (PC) party won a majority government with 43 percent of the popular vote and thereafter implemented the Free Trade Agreement (FTA). However, a majority of voters (52 percent) cast their ballot for parties that opposed the FTA (Liberals and New Democrats), thus raising the argument that the PC government did not have a mandate to implement the FTA.26 Another explanation is the observed correlation between low levels of political knowledge, or civic literacy, and low voter turnout in Canada.27 Others, like American author Ruy Teixeira, argue that there is a correlation between a lack of ‘social connectedness’ and non-voting: “The idea is that interpersonal, community, and general social ties provide a substantial proportion of an individual’s motivation to vote, because these ties provide external encouragement to vote, as well as an enhanced sense of an elections’ meaningfulness.”28 He feels that this explains why non-voting is so prevalent among young people.29 In addition, there appears to be a correlation between non-voting and low socio-economic status (SES), such as lower levels of education and poverty. Teixeira speculates that this occurs because low-SES citizens have little time and energy to vote (since they must focus all their activities on surviving), or that they feel the system does not respond to their needs.30 Canadian national election studies from 1965 to 1997 appear to support the latter assertion, since it found that a growing number of Canadians believe that the government is indeed unresponsive.31

Finally, Anthony Downs’ theory of ‘rational ignorance’ may also explain the observed decrease in voter turnout. Operating from a cost-benefit framework, Downs finds that the incentive to invest time and energy to overcome ignorance such that, for example, one can determine who would be the best candidate in an election, is directly proportional to the amount of influence that person feels they have on the outcome of the activity they will take part in. Sticking with the example of voting, in a large city, province or country, with tens of thousands of voters, one person’s vote is not likely to be determinative. Therefore, he concludes, there is

23 Jim Purser (Clerk’s Office), City of Kingston Election Summary Report (1994, 1997, 2000) [unpublished, archived and the City of Kingston Clerk’s Office]. 24 Supra note 15. 25 Judy Rebick, “PR Can Help Solve Canada’s Democracy Deficit” (July-August 2001) Policy Options 15 at 16. 26 Supra note 15. 27 Henry Milner, “Civic Literacy in a Comparative Context: Why Canadians Should Be Concerned” (2001) 2 Policy Matters 1. 28 Ruy A. Teixeira, The Disappearing American Voter (Washington: Brookings Institution, 1992) at 36-7. 29 Ibid. at 39-42. 30 Ibid. at 33-4, 57. 31 Supra note 15.


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little incentive to take the time to determine how to best cast that vote.32 Terrence Cook and Patrick Morgan, in their book Participatory Democracy, appear to concur: “For some, the ideal of universal suffrage loses its luster when suffrage means no more than the right periodically to cast one vote among thousands or even millions.”33 What can be concluded about the quality of our representative democracy in light of this information? Clearly participation (i.e. the act of voting) is suffering. This is likely having a direct and harmful effect on the democratic condition of political equality in Canada. Even though, with voting, “citizens’ preferences count equally”, low voter turnouts, particularly among the young and those of low-SES status, do not create a “process that can plausibly be viewed as representative of everyone.” The condition of deliberation is also likely to be adversely affected. Since citizens elect representatives to deliberate on issues of importance on their behalf, if a certain sector of society is not voting, like youth and low-SES groups, there is no guarantee that the representatives selected will deliberate on issues that are of concern to that non-voting sector. Admittedly deliberation does occur, yet the representative quality of those deliberations becomes dubious.

Finally, the condition of non-tyranny may also suffer because of non-voting. Recall that non-tyranny ensures “the political process avoids, whenever possible, depriving any portion of the citizenry of rights or essential interests…it must avoid the ‘tyranny of the majority’.” While many rights are guaranteed in the Canadian Charter of Rights and Freedoms, essential interests, particularly social or economic interests, are not legally protected. As an example, let us examine the Ontario PC government’s actions on social assistance after its victory in the 1995 provincial election. With a majority in the Legislature (64 percent of the seats with only 45 percent of the popular vote34) the government followed through on its campaign promise and reduced social assistance payments by 21 percent. These payments can be considered an “essential interest” to low-SES citizens who depend on them. Since 1995, total welfare income, as a percentage of the LICOs poverty line, fell by 16 percent for single persons, 12 percent for disabled persons, 17 percent for a single parent and 16 percent for a couple with two children.35 In all cases social assistance payments made prior to the 1995 cut were already below the poverty line – the 21 percent cut therefore further exacerbated the income deficiency of welfare recipients. Here, the political process has deprived a portion of the citizenry of an essential interest, and since the PC party is traditionally supported by the business sector and more well-off Ontarians, one could declare that on this issue the “tyranny of the majority” had become the “tyranny of the affluent.” 1.3.2. Pluralism

“(C)ontemporary theories of democracy focus on the activity of organized interest groups, competing to persuade government to respond to their claims, as the principal means through which the interests of individuals are represented in the policy-making process (emphasis added).”36 It could therefore be argued that pluralism may mitigate some of the deficiencies caused by non-voting in the quality of representation in Canadian democracy. To vindicate this 32 Anthony Downs, An Economic Theory of Democracy, (New York: Harper and Row, 1956). 33 Terrence E. Cook and Patrick M. Morgan, “An Introduction to Participatory Democracy” in Terrence E. Cook and Patrick M. Morgan, eds., Participatory Democracy (San Francisco: Canfield Press, 1971) at 3 ¶ 1. 34 “Summary of Valid Ballots Cast”, online: Elections Ontario <http://www.electionsontario.on.ca/en/Results_and_Stats_en.shtml >. 35 National Council of Welfare Reports, “Welfare Incomes 2002” (Spring 2003), online: National Council of Welfare <http://www.ncwcnbes.net/htmdocument/reportwelfinc02/WelfareIncomes.pdf> at 62. 36 Supra note 15.


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argument it is necessary, according to Perlin, “that all interests with a stake in an issue must have an equal opportunity to influence government decisions about that issue.”37 For this to occur, three conditions must be met. First, all interests must be able to freely organize and lobby the government. Second, there must be fair competition between interest groups to influence the government; implicit with this condition is that all interest groups have “equal access to the political resources necessary for success.”38 Finally, the government, when making decisions, will consider the views of each group solely on the merit of their claims.39 Studies of Canadian pluralism have shown that not all of the conditions have been fully met to allow “all interests…an equal opportunity to influence government decisions.” It is generally accepted that the first condition, the freedom to organize, has been met in Canada. However with the recent release of the Canadian Security Intelligence Service (CSIS) 2002 Public Report40, which named “certain elements of animals-rights (and) anti-globalization” organizations as sources of domestic terrorism, it could be argued that certain interests can no longer freely organize without fear of state interference. The strongest criticisms of pluralism are that the second and third conditions, namely the assumption that there is fair competition between groups and that governments assess the views of each group solely on merit, are simply not being met. A study by Robert Presthus found that groups representing major economic or industrial interests (like the auto and tobacco industries41) had a lobbying advantage over other groups.42 Presthus’ study was corroborated by Fred Thompson and William Stanbury43, who concluded their report by quoting Elmer Schattschneider: “The flaw of the pluralist heaven is that the heavenly chorus sings with a strong upper-class accent.”44 Government assistance directed at ameliorating inequality between interest groups has helped some organizations, such as women’s and aboriginal groups, but others, like anti-poverty organizations, still suffer from a lack of political influence.45

It can therefore be concluded that Canadian representative democracy is supported by a “slanted pluralism”46, in that it has predominantly benefited powerful economic interests. Consequently, pluralism cannot be said to have mitigated the damaging effects of non-voting on the quality of representation in the Canadian democratic system. How, then, do we improve the quality of representation in Canada? Commenting on the institutions entrenched in the American Constitution after the revolutionary war, Hannah Arendt observed: “Only the representatives of the people, not the people themselves, had an opportunity to engage in those activities of ‘expressing, discussing and deciding’ which in a positive sense are the activities of freedom.”47

37 Ibid. 38 Thomas R. Dye and Harmon Zeigler, The Irony of Democracy: An Uncommon Introduction to American Politics, 7th ed. (Toronto: Macfarlane, Walter and Ross, 1987). 39 Supra note 15. 40 “2002 Public Report” (5 June 2003), online: The Canadian Security Intelligence Service <http://www.csis-scrs.gc.ca/eng/publicrp/pub2002_e.html#3a>. 41 Supra note 15. 42 Robert Presthus, Elite Accommodation in Canadian Politics (Toronto: MacMillan of Canada, 1973). 43 Fred Thompson and William T. Stanbury, The Political Economy of Interest Groups in the Legislative Process in Canada (Montreal: Institute for Research on Public Policy, 1979). 44 Elmer E. Schattschneider, The Semisovereign People (New York: Holt, Rinehart and Winston, 1960) at 35. 45 Supra note 15. 46 Amitai Etzioni, “The Fallacy of Decentralization” in Terrence E. Cook and Patrick M. Morgan, eds., Participatory Democracy (San Francisco: Canfield Press, 1971) at 66. 47 Hannah Arendt, “On Revolution” in Terrence E. Cook and Patrick M. Morgan, eds., Participatory Democracy (San Francisco: Canfield Press, 1971) at 124 ¶ 1.


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One possible remedy may therefore come from the work and practice of advocates of participatory democracy, who argue, in agreement with Rousseau and other classical theorists, that democracy is improved by empowering citizens to engage in what Arendt referred to as “activities of freedom.” 1.4. Participatory Reforms: A Means To Improve Representation?

Cook and Morgan define a participatory democracy as a system which meets the following two conditions: (1) decentralization or dispersion of authoritative decision-making and (2) direct involvement of amateurs (laymen) in the making of decisions. Representation can exist in a participatory democracy, but it is “kept close” to the people. There are two forms of participatory democracy, termed co-determination and self-determination. Co-determination involves joint decision making by laymen and experts (or elected officials), usually by creating new structures for amateur participation within the existing structure which previously excluded participation (e.g. a municipal government). The experts’ main role in co-determination is to help facilitate the decision-making process. To do so, argues Frantz Fanon, it is important that experts speak in layman’s terms:

It is true that if care is taken to use only a language that is understood by graduates of law and economics, you can easily prove that the masses have to be managed from above. But if you speak the language of the everyday, if you are not obsessed by the perverse desire to spread confusion and to rid yourself of the people, then you will realize that the masses are quick to seize every shade of meaning and to learn all the tricks of the trade.48

In contrast, self-determination involves decision-making by laymen alone. Examples include New England town governments, Israeli kibbutzim, ancient city-states of Rome and Greece and the anarchist ideal of the fragmentation of nation-states into community control units.49

Two types of arguments are put forward in support of participatory democracy: (1) those that contend the process leads to beneficial learning, or the development of citizenship values; (2) those that stress that better decisions are made in a democratic system that is participatory. Each will be dealt with in turn. 1.4.1. Participatory Democracy Improves Citizenship Theorists argue that increased citizen participation accrues three benefits. The first is that participation spurs civic literacy.50 John Stuart Mill recognized that when citizens have a real stake in the decision-making process, when there is a venue for the exercise of political participation, an incentive to gather political knowledge is created:

A person must have a very unusual taste for intellectual exercise in and for itself who will put himself to the trouble of thought when it is to have no outward effect, or qualify himself for functions which he has no chance of being allowed to exercise. The only sufficient incitement to mental exertion, in any but a few minds in a generation, is the prospect of some practical use to be made of its results.51

48 Frantz Fanon, The Wretched of the Earth (New York: Grove Press, 1968) at 188-9. 49 Supra note 33 at 4-5. 50 Supra note 15. 51 Marshall Cohen ed., The Philosophy of John Stuart Mill (New York: Modern Library, 1961) at 403.


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Second, participation would advance social cohesion and foster a greater sense of community by improving citizen awareness of their shared interests.52 Third, participation may make participants more aware of the consequences of actions; rather than isolated “cogs” who are “ignorant of or simply indifferent to the impact of the wheel…(p)articipatory democracy may be able to contribute to meeting the psychological and ethical problem of relating personal conduct to social consequences.”53 Finally, it is argued that a citizen’s “capacity to effectively manipulate his environment through political participation”54 will build his or her sense of political efficacy, and act as a counter to contemporary feelings of cynicism and alienation which contribute to political apathy in the population.55 1.4.2. Participatory Democracy Improves Decision-Making Cook and Morgan concede that when they argue that participatory democracy improves decision-making, they mean it leads to more effective problem-solving, and not necessarily to more rapid decisions or improved efficiency in the energy required to come to a resolution.56 It is argued that decision-making is improved in three ways. First, greater participation increases the probability that an effective idea for solving a problem will be heard, particularly from those individuals who directly experience the fallout of the problem. Quoting Aristotle:

There is this to be said for the Many. Each of them by himself may not be of a good quality; but when they all come together it is possible that they may surpass – collectively and as a body, although not individually – the quality of the few best.57

Therefore “it could be argued that students are best situated to evaluate the teaching of faculty members; the poor may have much to contribute to the diagnosis of the causes of their own poverty and that of their neighbours on welfare rolls; and workers may have fresh insights for raising the efficiency of economic enterprises.”58 Second, the empowerment of citizens would make the government more responsive and accountable to public interests.59 Third, participation will help insure that decisions do not infringe on the interests of minorities by allowing such groups to take part in the decision-making process; such an assertion presumes that the participatory structure meets the conditions of non-tyranny.60 This is achieved, in part, by the decentralization of decision-making power, eliminating “the setup that enables some [groups] to become very efficient devils.”61 The anticipated effect of such a participatory decision-making system (what Mill called the “school of public spirit”62), is the general enhancement of the legitimacy of governing institutions.63

52 Supra note 15; note 33 at 9. 53 Supra note 33 at 15 ¶ 3. 54 Ibid. at 7 ¶ 3. 55 Ibid. at 9. 56 Ibid. at 12. 57 Ernest Baker, ed., The Politics of Aristotle (New York: Galaxy, 1962) at 123. 58 Supra note 33 at 12 ¶ 2. 59 Supra note 15. 60 Supra note 33 at 14-5. 61 Ken Knabb, “The Joy of Revolution – Chapter 1: Some Facts of Life,” online: Bureau Of Public Secrets <http://www.bopsecrets.org/PS/joyrev1.htm>. 62 Supra note 51 at 419-20. 63 Supra note 33 at 10-1.


10

1.4.3. Criticisms of Participatory Democracy Numerous criticisms have been launched against theories of participatory democracy. It is

argued that participatory theorists have not adequately dealt with Dahl’s “time-problem”, mentioned above. Between work, family life and recreation, many citizens may not have the time to engage in a lengthy participatory process.64 Some argue that participatory theorists over-estimate the capabilities of citizens to engage in the process65, and point to surveys of Western nations that show widespread apathy and illiberal attitudes throughout the population.66 Still others contend that “(generally) a truly decentralized participatory system… will tend to neglect inter-local, inter-regional and national needs, both of the allocative (e.g., social justice) type and those which are best served collectively (e.g., a priming of the economy).”67 Though the concerns just raised pose a serious challenge to the viability of wide-spread participatory institutions, some critics do concede that there is one area where a participatory system could be feasible and beneficial – cities. 1.5. Cities: The Ideal Venue For Experiments In Participatory Democracy Hannah Arendt, recounting Thomas Jefferson’s democratic ideals in her essay “On Revolution”, summarized his view of private and public morality, “Love your neighbour as yourself, and your country more than yourself.” She continued,

(H)e knew that this maxim remained an empty exhortation unless the “country” could be made as present to the “love” of its citizens as the “neighbour” was to the love of his fellow men. For just as there could not be much substance to neighbourly love if one’s neighbour should make a brief apparition once every two years, so there could not be much substance to the admonition to love one’s country more than oneself unless the country was a living presence in the midst of its citizens.68

To Mill, the ideal venue to create the polis as a “living presence” for citizens was the city:

“(I)t is only by practicing popular government on a limited scale, that the people will ever learn how to exercise it on a larger.”69 This sentiment is echoed by Dahl: “(A)s the optimum unit for democracy in the twenty-first century, the city has a greater claim, I think, than any other alternative.”70 He cites four main reasons to support this claim. First, cities are generally small enough to allow citizen participation. Second, cities do not make trivial political and economic decisions. Third, cities are an opportune unit for civic education. Finally, the problems dealt with by municipal governments are within reach of the average citizen since these problems affect many aspects of the community where people live, work and play.71 Bachrach concurs, saying that “political education is most effective on a level which challenges the individual to engage cooperatively in the solution of concrete problems affecting himself and his immediate community.”72

64 Supra note 15. 65 Ibid. 66 Supra note 2 at 3. 67 Supra note 46 at 64 ¶ 2. 68 Supra note 47 at 130 ¶ 2. 69 John Stuart Mill, in Gertrude Himmelfarb ed., Essays on Politics and Culture (New York: Doubleday, 1963) at 186. 70 Supra note 11 at 104 ¶ 2. 71 Ibid. at 105-8. 72 Supra note 8 at 103 ¶ 3.


11

For participatory democracy at the municipal to be successful and meaningful, says John Goodman, “participation” must move beyond mere consultation and delegate real power to citizens: “The say of a neighbourhood in its destiny can be meaningful only if the neighbourhood has begun to be conscious of itself as a community. For this, mere ‘consent’ or ‘participation’ is not enough; there must be a measure of real initiating and deciding, grounded in acquaintance and trust.”73 Is such a system practically possible? Archon Fung and Erik Wright argue that it is, and call such a system an “Empowered Deliberative Democracy (EDD).” These authors outline three fundamental principals of EDD: “(1) a focus on specific, tangible problems, (2) involvement of ordinary people affected by these problems and officials close to them, and (3) the deliberative development of solutions to these problems.” These principles are stabilized by three institutional design features:

(1) the devolution of public decision authority to empowered local units; (2) the creation of formal linkages of responsibility, resource distributions, and communication that connect these units to each other and to superordinate, more centralized authorities; and (3) the use and generation of new state institutions to support and guide these decentered problem solving efforts rather than leaving them as informal or voluntary affairs.74

Fung and Wright point out that a city-level EDD system (i.e. a co-determinative participatory system) already exists, but to find it we must look to the South American state of Brazil, where municipal governments have implemented a radical system of participatory decision-making which they call “participatory budgeting”. The next chapter introduces, outlines and analyzes in detail the participatory budgeting (PB) system currently operating in the city of Porto Alegre, Brazil. We will see that it provides a compelling precedent for the possible development of PB in cities outside Latin America as a means of improving representative democracy.

73 John Goodman, “People or Personnel” in Terrence E. Cook and Patrick M. Morgan, eds., Participatory Democracy (San Francisco: Canfield Press, 1971) at 53 ¶ 7. 74 Archon Fung & Erik Olin Wright, “Deepening Democracy: Innovations in Empowered Participatory Governance” (2001) 29 Politics & Society 5 at 17 ¶ 3.

Chapter 2 Participatory Budgeting in Porto Alegre, Brazil

12

Chapter 2 2. Participatory Budgeting in Porto Alegre, Brazil

Participatory budgeting (PB) is a unique democratic innovation that was first implemented in 1989 by the governing Worker’s Party (Partido dos Trabalhadores – PT) in the city of Porto Alegre, Brazil. The system strives to involve the general populace in the prioritization and allocation of municipal resources outlined in the yearly city budget, with the primary goal of redistributing these resources from the advantaged to the disadvantaged.1,2 Since 1989, PB has been implemented in over 140 Brazilian cities (90% of which are run by the PT3) and 6 states4, however the system in Porto Alegre stands as the most sophisticated and successful to date. Awareness of the cultural and political conditions which led to the inception and successful implementation of PB in Porto Alegre is important if one wishes to export the process for use in North American municipalities. Therefore this chapter begins with a brief history of Brazil and Porto Alegre prior to the overthrow of the military dictatorship in 1988 and the founding of Brazilian democracy. Next, I examine the budgeting powers of Brazilian municipalities under their Constitution, followed by a detailed discussion of the PB process itself. Finally, results of the PB in Porto Alegre are analyzed, followed by an examination of PB criticisms. 2.1. A Short History of Port Alegre, Brazil

Brazil has a long tradition of authoritarian regimes, with the popular classes marginalized or co-opted by clientelism5 (defined as a system where “those in power use their access to state resources to provide personal favors to a broad-based clientele who, in turn, mobilize votes for their patrons”).6 “Outrageous inequality” amongst citizens has increased over the last two decades, making Brazil, according to the World Bank, one of the most unjust societies in the world.7 In the words of author Boaventura de Sousa Santos, “Brazilian society and politics are, in sum, characterized by the predominance of the state over the civil society and by huge obstacles against the construction of citizenship, the exercise of rights, and popular autonomous participation.”8 Nevertheless, many cities, including Porto Alegre, had a strong and organized civil society9 that resisted the military dictatorship through the 1960’s and 70’s. During that period many unions, neighbourhood associations, soccer clubs, co-operatives, mothers’ clubs, 1 Boaventura de Sousa Santos, “Participatory Budgeting in Porto Alegre: Toward a Redistributive Democracy” (1998) 26 Politics & Society 461 at 462. 2 Jeremy Heimans, “Strengthening Participation In Public Expenditure Management: Policy Recommendations For Key Stakeholders” The Organization For Economic Co-operation and Development (2002), online: OECD <http://www.oecd.org/pdf/M00037000/M00037848.pdf> at 6. 3 Supra note 1 at 505. 4 Aaron Schneider and Ben Goldfrank, “Budgets and ballots in Brazil: participatory budgeting from the city to the state” Institute of Development Studies (January 2002), online: IDS <http://www.ids.ac.uk/ids/bookship/wp/wp149.pdf> at 1. 5 Supra note 1 at 462. 6 Rebecca Abers, “From Clientelism to Cooperation: Local Government, Participatory Policy, and Civic Organizing in Porto Alegre, Brazil,” (1998) 26 Politics & Society 511 at 512 ¶ 4. 7 Supra note 1 at 463. 8 Supra note 1 at 462 ¶ 2. 9 Marta Harnecker, “Delegating Power To The People: Participatory budget in Porto Alegre,” online: The World Bank <http://www1.worldbank.org/wbiep/decentralization/laclib/harnecker.pdf> ¶ 34, 38.


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cultural groups, among others, were formed. By 1988 it is estimated that 1000 community organizations existed in Porto Alegre.10 These groups focused their attention on struggles for bus lines, sewage, street pavement, housing and health centres.11 The strongest force within this movement was the PT, which was established in 1980.12

After the fall of military rule and the entrenching of the Brazilian Constitution in 1988, the Popular Front (a coalition of left organizations in which the PT was the major player) ran for and won the mayoralty in seven large cities, one of which was Porto Alegre. Porto Alegre is a city of 1.3 million people, covering 489 square kilometers, with a GNP in 1994 of U.S. $6.7 billion.13 The city is of major economic importance in the southern state of Rio Grande do Sul. Along with being the state capital, housing 18 percent of the state’s population, Porto Alegre is the state’s largest industrial city, producing 12 percent of the industrial gross product, and is responsible for 33 percent of the income generated by the service sector in the state.14 Immediately after taking power, the PT began work to implement the PB process. 2.2. The Participatory Budgeting Process

Municipalities in Brazil have relative autonomy in determining revenue (taxes) and expenditures (mainly investment in equipment and public works). The Brazilian Constitution divides a city’s governing power between the Mayor (Prefeitura) and the Chamber of Deputies (Camara de Vereadores). Only the Chamber can approve a municipal budget. The PT has controlled the mayoralty of Porto Alegre since 1989 but has never held a majority in the Chamber. The PB process was therefore initiated by the Mayor’s office and is managed by the Executive branch of the municipal government.

The PB process is rooted in three principles: (1) All citizen’s can participate; community organizations have no special status; (2) Participation is governed by direct and representative rules decided by the participants; (3) Investment resources are allocated based on (a) general criteria established by citizens engaged in the PB process, and (b) technical criteria (viability of projects) established by the executive. Three kinds of institutions have been set up to govern the PB process. The first are numerous administrative units of the executive who manage the budget deliberation among citizens. The two most important of these are the Planning Office (Gabinete de Planejamento – GAPLAN) and the Coordination of Relations with the Communities (Coordenacao de Relacoes com as Comunidades – CRC). The CRC helps gather the demands of citizens while the GAPLAN translates those demands into technically and economically viable policy. Second are the community organizations (neighbourhood associations, popular councils, unions) who organize and mobilize the populace to engage in the PB process. These organizations are autonomous of government. The final kind of institution are those which mediate between the first two. These include the Participatory Budgeting Council (Conselho do Orcamento Participativo – COP), the Regional Plenary Assemblies (Assembleias Plenaria Regionais), the Budgeting Regional Forum (Forum Regional do Orcamento), the Thematic Plenary Assemblies (Assembleias Plenarias Tematicas) and the Budgeting Thematic Forum (Forum Tematico do Orcamento).15

10 Supra note 1 at note 10. 11 Supra note 1 at 466. 12 Supra note 6 at 516. 13 Supra note 1 at 465. 14 Supra note 1 at 465; statistics are from 1992. 15 Supra note 1 at 467-9.


14

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PB is an ongoing, yearlong process,16 and is outlined diagrammatically in Figure 2-1.17 The city is divided into 16 regions and 5 thematic (city-wide) areas. These areas are transportation, education/leisure/culture, health and social welfare, economic development and taxation, city organization and urban development.18 The process officially begins in early March with preparatory meetings of community organizations and popular councils in the regions; here, citizens prepare to select delegates and collect demands on regional/thematic issues. In late March/early April the first Plenary Assembly (Rodada) of all 16 regions and 5 thematic areas is held, organized by the GAPLAN and CRC along with citizen delegates and councillors from the previous year’s PB process. Numerous tasks are undertaken at this Rodada. There is a rendering of accounts of the previous year’s PB Investment Plan by the Executive.19 Citizens begin to discuss their regional and thematic priorities. The general budgeting criteria and methodology (referred to above) agreed upon by the previous year’s COP council is presented. Finally, citizens begin electing regional and thematic delegates. Elected delegates become members of the Fora of Delegates, who meet once per month20 and are responsible for acting as intermediaries between elected COP councillors and citizens.21 Delegates can also form oversight committees, with direct access to the Mayor’s office, to supervise the implementation of public works.22,23 The selection process is based on attendance at the meeting (see Table 2-1). Only residents of a region can vote for their regional delegate. Table 2-1: Delegate Selection Criteria24 No. of participants Proportion of delegatesattending meeting per participants

0-100 1 per 10101-250 1 per 20251-400 1 per 30401-550 1 per 40551-700 1 per 50701-850 1 per 60

851-1000 1 per 701000+ 1 per 80

Concurrent with and proceeding the first Rodada are a series of ‘intermediate meetings’

held between March and June. Delegates along with community and thematic associations in each region organize these meetings, with help provided by members of the Executive (CRC and GAPLAN). The remaining delegates are elected at the meeting with the largest quorum. Delegate committees are then established to supervise the public works-in-progress. In addition to delegate selection, the final collection of citizen demands is made, including proposals for

16 Supra note 1 at 469-74. 17 Supra note 1 at 470 [reproduced in modified form]. 18 Supra note 9 ¶ 193-4. 19 Supra note 9 ¶ 137-38. 20 Supra note 9 ¶ 157. 21 Supra note 9 ¶ 95. 22 Brian Wampler, “A Guide to Participatory Budgeting” The International Budget Project (October 2000), online: <http://www.internationalbudget.org/resources/library/GPB.pdf> at 14. 23 Supra note 9 ¶ 89. 24 Supra note 9 ¶ 82.


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public works given by the Executive.25 Citizens then engage in intense deliberations, facilitated by the Executive, to rank their priorities.26 Each region must pick and rank 5 priorities from 12 different sectors (sewage, housing, pavement, education, social assistance, health, transportation, city organization, leisure areas, sports and leisure, economic development, culture). Each priority is given points based on its rank. This information is then sent to the Executive who tally the data and identify the top three priorities (i.e. in 1997 the three priorities were housing, pavement and sewage). Sometime in June or July, the Second Rodada is co-ordinated and chaired by the Executive in conjunction with the popular organizations in the region. Here, the 16 regions and 5 thematic areas hand in priorities and demands for specific public works.27 In addition, the Executive outlines expenses and anticipated income, and the councillors for the COP are elected. Two councillors and two substitutes from each region are elected to the COP for a one-year term (each councillor can only be re-elected once28). Each regional councillor is subject to immediate recall by a 66 percent vote of regional delegates. The COP also has one representative each from the Municipal Worker’s union and the Residents’ Associations union. In addition, there are two government representatives, one from the Planning Cabinet and the other from Community Relations.29 Sometime between July and September, the COP council is inaugurated.

The COP meets at least once per week, and sometimes two to three times per week. Councillors first learn about public budgeting (similar seminars are available to citizens in the regions). In August and September, GAPLAN drafts a budget proposal based on the viable demands and priorities of the 16 regions and 5 thematic areas (generally only 30 percent of demands can be undertaken30), which it submits to the COP, the financial board of the Mayor, and the government departmental secretariats. At this time the COP does two things: it discusses (1) the budget proposal and (2) revenue and expenditure items and the criteria for resource allocation.

Recall that the distribution of investment resources is based on a general set of criteria established by the COP.31 These general criteria are (1) ‘Population’: total population of the region; (2) ‘Need’: need for urban infrastructure/services in the region; and (3) ‘Priority’: priority assigned to the sector or theme by the region. Each region receives a criteria grade for each sector (see Table 2-2). For example, under the sector ‘Pavement’, a region which requires 20 percent of its roads to be paved is given a grade of 1 under the ‘Need’ criteria, while a region which requires 80 percent is given a grade of 4. Each criterion is also given a general weight, between 1 and 3, based on the importance attributed to it by COP (in 1998, ‘Need’ and ‘Priority’ were each given a general weight of 3, while ‘Population’ was given a general weight of 2). Each region receives points for each sector (e.g. Pavement) by multiplying the criteria grade by the weight and summing the products. Investment resources are allocated to the regions according to the proportion of total points each region receives in each sector.

25 Supra note 9 ¶ 140, 142. 26 Gianpaolo Baiocchi, “Participation, Activism, and Politics: The Porto Alegre Experiment and Deliberative Democratic Theory” (2001) 29 Politics & Society 43 at 46. 27 Supra note 9 ¶147-50. 28 Supra note 9 ¶ 98. 29 Supra note 9 ¶152. 30 Supra note 1 at 493. 31 Supra note 1 at 474-75; note 9 ¶ 180-82.


17

Table 2-2: Grading of General Criteria32 General Criteria

Need Population PriorityGrade Grade Grade

0-25% 1 0-49,999 1 Fourth or lower 126-50% 2 50,000-99,999 2 Third 251-75% 3 100,000-199,999 3 Second 376-100% 4 200,000+ 4 First 4

Boaventura de Sousa Santos provides a specific example from the 1997 budget.33 In that

budget, under the ‘Pavement’ sector, the Investment Plan indicated that 20 km of road pavement was to be distributed to the regions that year. He contrasted two different regions – Extremo Sul and Centro (see Table 2-3). Extremo Sul had a small population and was therefore given a grade of 1 (out of 4) under the Population criteria. Centro, with a much larger population, was given a grade of 4. Since the general weight for Population was 2, Extremo Sul received 2 points while Centro received 8 points. Extremo Sul had a high need for pavement and was therefore awarded a grade of 4, while Centro, which did not need much pavement, received a grade of 1. The general weight for Need was 3, therefore Extremo Sul received 12 points while Centro received 3 points under the Need criteria. Finally, Extremo Sul ranked the pavement as a high priority and received a grade of 4, while Centro did not rank pavement as a priority at all and thus received a grade of 0. The general weight for Priority was 3, therefore Extremo Sul received 12 points and Centro received none. The points were totaled, giving Extremo Sul 26 points and Centro 11 points for the ‘Pavement’ sector. Since the global points for this sector was 262, Extremo Sul was to receive 9.9% of investment (26 ÷ 262 = 9.9%) while Centro was to receive 4.2% (11 ÷ 262 = 4.2%). This translates into 1,985 and 840 meters of pavement (of the allotted 20 km of pavement in the budget) for each respective region. Table 2-3: General Criteria For Distribution of Investment Resources

Criteria (General Weight)Region Population (2) Need (3) Priority (3) Total Points Global % of Metres of Extremo Sul Grade 1 4 4 Points Investment Road

Points 2 12 12 26 262 9.9 1,985Centro Grade 4 1 0

Points 8 3 0 11 4.2 840

Prior to discussions on the budget proposal, COP councillors take part in a ‘PB caravan’. They travel to all regions of the city to see for themselves what each region requires.34 After discussions, COP councillors vote on the budget proposal by simple majority35, and submit it to the Mayor (who has the power to veto the proposal) in late August/early September. Once approved by the Mayor, the budget proposal must be submitted to the Chamber of Deputies no later than September 30. After submitting the budget proposal, the COP prepares its Investment Plan (generally the COP has discretion over 20% of the entire city budget when developing this

32 Supra note 26 at 66. 33 Supra note 1 at 475. 34 Supra note 9 ¶ 111-14. 35 Supra note 1 at 491.


18

plan36). The Investment Plan outlines the allocation of resources to each region (based on the criteria described above) as well as providing a detailed list of prioritized works (utilizing the assigned resources) to be completed in each region.37 Upon receipt of the budget proposal, the Chamber is empowered to make changes to the document, and must vote on the budget by November 30, under the supervision of the COP. Prior to the Chamber vote, COP councillors actively lobby Chamber deputies and department secretariats to support their Investment Plan, and the budget is often passed with few modifications. The delegate committees, who have direct access to the Mayor’s office if any problems are encountered, oversee public works initiated under the approved Investment Plan. 2.2.1. Sizeable Participation in the Participatory Budget Process Various reports have shown that citizen participation in the PB process has steadily increased since its inception in 1989. In the first two years of the PB, less that 1,000 people participated. This rose to 8,000 participants in 199238, as citizens realized “that there is a direct connection between the time they dedicate to PB and changes in policy outcomes.”39 In 1996, 14,267 participated in the two Rodadas, however the Mayor’s office estimates that 100,000 people (8 percent of the population) participated in all the meetings combined.40 In 1998, participation was estimated to surpass 300,000 people.41

Even though Porto Alegre already had a history of strong civil society organization, since its inception the PB process is credited with spurring a dramatic increase in neighbourhood activism. A 1995 survey of participants found that 66 percent belonged to neighbourhood associations.42 Gianpaolo Baiocchi reports that after a decade of PB, the number of associations in the city has doubled.43 Rebecca Abers feels that this surge in ‘associationalism’ was nurtured by an “enabling environment” created by the PT through the PB process:

Some people are born activists, struggling for improvements even when government is not responsive to them. Others may be interested in their communities and in improving their conditions but are unwilling to go through the long, tortuous, and usually frustrating process of organization and protest. Many of those who began participating in the participatory budget policy fit into this second category. For them, the participatory budget policy provided an environment in which, for the first time, it was easy and rewarding to participate in public life.44 (emphasis added)

Though the level of participation in Porto Alegre is impressive, a study of the 1998 budget indicates that the PB is not an entirely egalitarian process. Women and persons with low education (less than grade 8) are underrepresented at the higher tiers of the process, namely at the delegate and COP council level. Women make up just over 50 percent of general

36 Alternative Federal Budget 2003 Technical Paper #4, “Democracy Counts! Participatory Budgeting in Canada and Abroad,” Canadian Centre for Policy Alternatives (17 February 2003), online: Canadian Centre for Policy Alternatives <http://www.policyalternatives.ca/afb/participatory-budgets.pdf> at 1; note 26 at 48. 37 Supra note 1 at 473. 38 Supra note 22 at 3. 39 Supra note 22 at 25 ¶ 2. 40 Supra note 1 at 486-7. 41 Supra note 9 ¶ 82, 125. 42 Supra note 6 at 511, 518, 530. 43 Supra note 26 at 55. 44 Supra note 6 at 530 ¶ 4


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participants, yet only 35 percent of COP councillors are female. This difference appears to be largely attributable to a lack of free time, given that familial household responsibilities primarily fall on the shoulders of Brazilian women. Low-educated citizens account for 60 percent of general participants yet only 18 percent are COP councillors. Although this data present a prima facie cause for concern, it has been shown that these gender and education effects are offset by increasing years of experience in the PB process and by ties to civil society organizations.45 Generally speaking, since 1993 there appears to have been an increase in income and education of PB participants, particularly those who participate in the thematic (city-wide) meetings.46 The thematic areas were, in fact, created to facilitate participation of the more affluent and educated classes (students, professors, artists, business owners, etc.).47 de Sousa Santos argues that middle class participation has increased because PB administration is more effective, is not corrupt and has improved services of interest to the middle class, such as garbage collection, public spaces, gardens and parks and cultural activities.48 2.2.2. Participatory Budgeting Produces Significant Social and Political Results Since implementing the PB process, Porto Alegre has seen a significant increase in basic services for its citizens. In 1989, basic sanitation reached 49 percent of the population. By 2001, 98 percent of households had access to water and were serviced by a sewage system. Between 1989 and 1996, the administration, under the direction of the PB, funded the construction of approximately 900 km of sewage pipe, 200 kilometers (km) short of all the sewage pipe built by every previous administration combined. In that same period, an average of 30 km of street pavement was laid per year, eliminating 50 percent of the total street pavement deficit in the city. Enrolment in elementary and secondary school also doubled between 1989 and 1996. Overall, total investments in municipal works rose from U.S. $54 million in 1992 to $70 million in 1996. Although the increase in investment was made possible in part by the increase in federal and state transfers to the city, it is argued that transparency in the budget process and the implementation of citizen demands have created an incentive for citizens to pay local taxes, which has further increased the city’s revenue base.49 Most citizens feel they have directly benefited from the PB process. A 1995 survey of participants in regional and thematic assemblies indicated that 57 percent felt they had benefited from the works and services provided by PB. The same survey shows a correlation between length of participation and identifying benefits – 73 percent of those who participated for 6 years claimed to have directly benefited from PB works and services.50 In addition, Porto Alegre was nominated by the influential business journal Exame as the Brazilian city with the best quality of life for four years in a row (1992-1996).51

The PB process also appears to have brought increasing political success to the PT party. Municipal public opinion surveys in 1996 gave the PT an ‘excellent’ or ‘good’ rating from 65 to 70 percent of those polled. If ‘medium plus’ is included as a positive indicator for the PT, its approval rating jumps to 85 percent. The approval ratings seem to have translated into greater electoral success for the PT. In 1988 the PT won 34 percent of the popular vote. This rose to 41 45 Supra note 26 at 51-2. 46 Supra note 1 at 486. 47 Supra note 9 ¶ 191. 48 Supra note 1 at 506. 49 Supra note 1 at 485; note 9 ¶ 273-74; note 26 at 48. 50 Supra note 1 at 494. 51 Supra note 1 at 464.


20

percent in 1992 and in 1996 the PT received 54 percent of the vote.52 In the most recent 2001 elections, the PT won its fourth straight mayoralty in Porto Alegre.53 Aaron Schneider and Ben Goldfrank argue that by empowering lower class citizens to participate, and making the government more transparent and responsive (and hence less corrupt and wasteful), the PT were able to secure both lower and middle class support for their administration.54 2.3. Criticisms of the Participatory Budgeting Process

The PB process in Porto Alegre has not been without its critics. A survey of the literature identifies eight separate criticisms of PB. Four of these criticisms raise valid issues and deserve consideration when assessing the utility of the PB process in Porto Alegre. These include: (1) accusations of patronage in PB decision-making; (2) PB wrongfully appropriates the power of the Chamber of Deputies; (3) accusations of rubber-stamping government policy in thematic meetings; and (4) complaints of excessive meetings, which may limit the ability of citizens to meaningfully participate in the PB process, particularly as COP councillors. The four remaining criticisms have been countered by various studies and testimonials. These criticisms include: (5) charges that the PB process both co-opts and (6) fragments the popular movement in Porto Alegre; (7) that the PB process is unsustainable during times of fiscal constraint; and (8) that the decentralization of budget decision-making diminishes government control, efficiency and planning.

2.3.1. Patronage in Participatory Budget Decision-Making Process Though the PB boasts of allowing any citizen to actively and substantively participate in the development of Porto Alegre’s budget, there are indications that key decisions, such as who is elected to the COP or to the Fora of Delegates and which demands are made at the meetings, are “captured”55 by a small number of key figures in each region, particularly those with links to the PT.56 Observing the PB process in Porto Alegre, de Sousa Santos reports that, “(t)he delegates elected in the first round of plenary assemblies and then in the ‘intermediary meetings’ are in general selected by the leaders of the associations present at the meetings, and thus there is not much of a chance for a citizen not integrated into a collective structure to be elected delegate.”57 This was confirmed in a series of interviews conducted by Marta Harnecker.58 The same process appears to occur when decisions about local projects are made: “In the intermediate meetings, there is much discussion and voting, but the real negotiations leading to proposals to be voted for tend to take place behind the scenes at informal meetings of the community leaders.”59 2.3.2. The Participatory Budget Process Usurps the Power of the Chamber of Deputies Commentators have pointed out that one of the risks of PB is the “erosion of the legitimacy of established democratic institutions such as parliaments in favour of less

52 Supra note 1 at 464. 53 Supra note 4 at 1. 54 Supra note 4 at 13. 55 Supra note 2 at 10. 56 Supra note 4 at 15. 57 Supra note 1 at 471 ¶ 4. 58 Supra note 9 ¶ 85-6. 59 Supra note 1 at 472 ¶ 1.


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accountable civil society organizations.”60 The elected Deputies of the Chamber feel that the PB process has severely limited their power to make decisions on budget issues.61 This is because,

the (Mayor), in strict legal terms, limits itself to submitting to the (Chamber) a budget proposal that the (Chamber) is free to approve, change or defeat. In political terms, however, because the executive’s proposal is sanctioned by the participatory budgeting institutions and thus by the citizen’s and community organizations and associations that participate in them, the executive’s proposal becomes a fait accompli for the legislative body in view of the political risks for the deputies in voting against the ‘will of the citizens and the communities.’”62

Therefore, in effect, the constitutionally entrenched Chamber merely becomes a rubber-stamp for the legally unrecognized, but popularly supported, PB process.

In fact, participants have questioned the value of the Chamber and wondered aloud why the scope of the decisions made by PB should not be expanded.63 The Deputies argue that this consequence is not justified, since no matter how many people participate in the PB process, the Chamber is more representative than the PB council because more voters elect the Deputies. Given the history of corruption in the budget process prior to the implementation of the PB process, the quality of the Chamber’s representation is dubious. Nevertheless, other commentators have expressed a similar concern, questioning the representative legitimacy of civil society groups making budget decisions, whose allegiances are at times unclear.64 PB defenders counter this, stating first that voting for Deputies to fill the Chamber is mandatory in Brazil, therefore compulsory democratic participation cannot be compared to voluntary participation in the PB. Second, they argue that PB councillors are more closely linked to the popular masses, therefore the quality of their representation is higher.65 Jeremy Heimans agrees, stating that the Brazilian experience suggests that PB has actually improved the “character of representative democracy (since PB has) forced old actors to respond to demands that are more representative than a few powerful lobbies and electoral constituencies.”66 However, in light of the claims of patronage in PB decision-making cited above, this criticism deserves consideration. 2.3.3. Rubber-stamping Government Initiatives at Thematic Meetings

There have been criticisms of the PB thematic meetings. Brian Wampler points out that participants in these meetings do not propose and deliberate on policies of their own design, but instead debate those proposed by the city administration. He argues that this occurs because most participants lack the requisite knowledge and experience to engage in city-wide policy development. Instead, participants often follow the lead of head civil servants or policy advocates; participant decisions in this case are often merely rubber-stamps.67 This criticism is linked to a general criticism that the average citizen cannot meaningfully contribute to budget decision-making due to their lack of knowledge or expertise. Critics argue that PB simply creates ‘shopping lists’ of demands that do not reflect an understanding of the

60 Supra note 2 at 10 ¶ 3. 61 Supra note 2 at 30; note 4 at 14. 62 Supra note 1 at 467 ¶ 3. 63 Supra note 9 ¶ 284. 64 Supra note 2 at 18. 65 Supra note 1 at 503. 66 Supra note 2 at 13 ¶ 5. 67 Supra note 22 at 16.


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scarcity of public resources. Such circumstances are inherently self-destructive, since the government’s inevitable failure to meet all the demands will most likely scuttle support for the PB process. However, Heimans argues that such a situation is not inevitable, and can be circumvented by designing the PB project to ensure that budget limitations are understood by all participants.68 2.3.4. The “Too-Many-Meetings” Problem

As described earlier, PB participants can take part in two general Rodadas, as well as many regional and thematic intermediate meetings. Though there have been no direct studies to date on the ability of average participants to attend all the relevant meetings, it is likely not irresponsible to speculate that the average citizen does not have the time to attend every meeting given work and familial commitments. Most research on this topic has focused on COP councillors. The COP council meets once per week, occasionally two to three times per week, for several months.69 This is difficult for some COP councillors to do, particularly given that they receive limited travel expenses (some are given bus fare) and no remuneration for their involvement. This makes it challenging to participate unless one is retired, self-employed, and financially stable.70 Such a scenario leads de Sousa Santos to worry that “(t)he routine of mobilization (will lead to) the mobilization of routine,”71 resulting in the replacement of common citizen participants with specialized participatory citizens. 2.3.5. Popular Movement Co-option

There is some concern from popular movement leaders, those who are not affiliated with the PT party, that the PT has co-opted the popular movement through the PB.72 CIDADE, an NGO that follows the PB, has reported that there is some uneasiness in communities since some COP councillors take positions without consulting the community and at times do not report back on PB debates and decisions. There is also concern that the administration has too much control over the PB process, if for no other reason than their privileged access to technical information.73 This is essentially a transparency problem, and likely has to do with the difficulty in grasping and disseminating the technical information used in PB decision-making74 (this may explain the increase in educated people participating in the PB).

While these transparency issues must be addressed, some have argued that the close association of popular movements with the administration through the PB process has beneficially changed the political culture in Porto Alegre from one “of protest and confrontation to a culture of conflict and negotiation.”75 de Sousa Santos argues that, “institutional mediation between the executive and the community organizations was started so as to combine effective participation with the preparation of an efficient, coherent, and realistic budget.”76 She, along with direct participants77, feels that this did not weaken or marginalize the popular movement,

68 Supra note 2 at 18. 69 Supra note 1 at 490, 494. 70 Supra note 4 at 4; note 9 ¶ 295-303; note 26 at 52. 71 Supra note 1 at 506 ¶ 3. 72 Supra note 1 at 487; note 9 ¶ 325; note 26 at 54. 73 Supra note 1 at 474. 74 Supra note 1 at 488. 75 Supra note 1 at 482 ¶ 4. 76 Supra note 1 at 477 ¶ 5. 77 Supra note 9 ¶ 326.


23

given that the plurality of organizations that constitute the movement continue to be recognized as autonomous organizations vis-à-vis the state.78 In fact, one survey reports that the PB process has actually strengthened participation in civil society organizations.79 2.3.6. Fragmentation of the Popular Movement

Some have argued that the PB process would further fragment the popular movement, as different groups fight amongst themselves for the distribution of resources in the budget.80 However both Abers and Baiocchi argue that instead of causing fragmentation, the PB process has instead created and strengthened “networks of reciprocity and trust” between neighbourhood associations. Abers feels that the negotiations these associations engage in to list priorities for their region encourage alliances and networks between disparate groups. “Individuals within the networks changed the way they understood their own interests, beginning to see themselves as members of larger groups and beginning to take the interests of others into account. In these ways, the budget process discouraged long-standing traditions of clientelism and promoted what some authors would call ‘social capital’.”81 Heimans adds that the general numerical criteria for prioritizing public works employed in the PB process (described above) has limited the risk of conflict between groups.82 2.3.7. Participatory Budgeting Is Not Sustainable During Times of Fiscal Restraint

It could be argued that there is a link between the level of investment (i.e. citizen demands being met) and participation in the PB process. Therefore, if budget constraints are encountered, participation may be adversely affected.83 However there appears to be general awareness amongst participants that the availability of programs under PB are limited by the authority and revenue constraints of the municipal government.84 A study of PB at the state level also appears to counter this criticism. When the PT implemented PB in the state of Rio Grande do Sul in 1999, it invested 130 million reais (Brazilian currency) less than the previous administration. In 2000 it only invested 206 million reais on a PB Investment Plan that called for 751 million reais in spending. Nevertheless, participation grew from 188,528 citizens in 1999 to 281,926 participants in 2000.85 The authors of the study feel that the support for PB even in the face of fiscal constraint was driven by the population’s endorsement of PT spending priorities, such as education, health, housing and sanitation. 2.3.8. Decentralization Will Diminish Budget Control, Efficiency and Planning

Some have argued that the decentralization of decision-making authority that accompanies PB will lead to a loss of budget control, decrease in efficiency and inhibition of government planning.86 At the state level, the implementation of PB has led to higher deficits and an increase in taxes as a per cent of GDP, both indicators of decreased budget control. However, the increase in tax collection is credited to the PT government’s crackdown on tax

78 Supra note 1 at 478. 79 Supra note 26 at 60. 80 Supra note 2 at 10; note 26 at 54. 81 Supra note 6 at 533 ¶ 1. 82 Supra note 2 at 23. 83 Supra note 1 at 495. 84 Supra note 22 at 17. 85 Supra note 4 at 8. 86 Supra note 2 at 16; note 4 at 10-1.


24

evasion, and while an increase in deficit financing under PB is frowned upon by critics, in the Canadian municipal context such a concern would not apply given that municipalities are required by law to balance their operating budgets. With regards to efficiency and planning, PB appears to have improved both at the state level. Schneider and Goldfrank measure efficiency as the ability to meet commitments by supplying adequate funding. After the implementation of PB, the PT government increased the number of education and health projects in Rio Grande do Sul by 20 and 14 percent respectively. Planning capacity was measured as the accuracy of the planned budgetary revenues and expenses when compared to actual expenditures and receipts. In 1998, the year prior to the implementation of PB, the administration collected only 76 percent of expected receipts, and spent 37 percent more than budgeted. In 1999, the first year of PB, the government collected almost 90 percent of receipts and spent 2 percent more than budgeted. In 2000, 88 percent of receipts were collected, and the government actually invested less than what was budgeted (82 percent of expenditures).87 2.4. Conclusions Weighing the balance of evidence presented here, it can be concluded that the unique experiment of PB in Porto Alegre has been successful both at improving the material situation of Brazilians within the city, as well as balancing the conditions required for democratic institutions (recall Fishkin’s four democratic conditions are participation, deliberation, political equality and no tyranny of the majority). Since 1989, under PB clientelism and corruption within the Porto Alegre administration have been significantly reduced, thus enhancing the political equality of citizens. This has translated into improved government efficiency, enhanced public investment and an increase in the standard of living. PB has significantly increased citizen participation (both poor and middle class), not only in the governing process, but also in civil society organizations. PB deliberations, particularly in regional meetings, have enhanced government control and planning, making the budget more responsive to the needs of citizens, especially those in poorer areas of the city. Problems with thematic meetings, the role of the Chamber of Deputies, and concerns over the number of meetings during the PB process are not insurmountable and can potentially be addressed by structural changes in the process. The more serious charge of patronage is certainly a blemish on the process that must be dealt with by PB organizers. However it is not such a significant concern as to de-legitimize the entire PB process, particularly given the numerous benefits PB has brought to the city.

Given the beneficial results of PB in Porto Alegre, the export of PB to the cities of other nations becomes an appealing enterprise for those interested in improving local democracy. In the next chapter a theoretical PB model developed for the city of Salford, England, called the “Salford Budget Matrix”, will be introduced. This model is based on the Brazilian PB process but has been adapted to meet the specific political culture and needs of the British city. It is hoped that an analysis of the Salford Budget Matrix will help with the development a PB model for Canadian cities.

87 Supra note 4 at 10-2.

Chapter 3 The Salford Budget Matrix Study

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Chapter 3 3. The Salford Budget Matrix Study At the time of this writing, only one municipality outside of South America has attempted to develop a participatory budget (PB) model. The city of Salford, England, is a northwestern industrial city near Manchester, with over 220,000 citizens in an area covering 37 square miles.1 The Community Pride Initiative (CPI)2 was commissioned by the city to undertake a pilot study “to enable Salford City Council to explore a new approach to tackling poverty and social exclusion by re-invigorating local democracy in the city.”3 The result was the Salford Budget Matrix Study, which contains a hypothetical PB model based on the Porto Alegre PB process described in Chapter 2. 3.1. Overview of the Salford PB Model

Though the Salford Budget Matrix Study makes numerous recommendations on improving citizen participation through a variety of consultative measures, this chapter will deal solely with the proposed PB model which involves citizens in making actual budget decisions.

Salford is divided into nine Service Delivery Areas (hereinafter “Areas”), each containing one to three electoral Wards (see Figure 3-14). Each Area has an established Community Committee which facilitates the involvement of local citizens in the governing process.5 The PB process begins in April/May, at the start of the fiscal year, with the creation of an Investment Fund – amounting to £1 million. In the study, this theoretical fund was generated by “top-slicing” a small percentage of each city department budget.6 In June/July, an Oversight Committee, composed of one delegate from each Community Committee, is established to ensure that the PB process is carried out correctly. In August/September, each Community Committee holds neighbourhood meetings in their Area to empower citizens to meet two objectives. First, citizens must rank seven themes in terms of their investment importance for the community. Second, citizens also outline ideas for specific community projects based on these themes, and in co-operation with the Community Committee, create a Community Action Plan (CAP) outlining the projects.

In October/November, the CAP is submitted to the city directorates who assess the feasibility of the recommended projects. In the meantime, the information gathered at the neighbourhood meetings is fed into a Budget Matrix, which allocates a proportion of the Investment Fund for each theme to each Area based on four criteria – city-wide priorities, local priorities, population and deprivation. In December/January, based on the financial allocation of the Budget Matrix and the feedback from the directorates, Community Committees then select, plan and commission projects from the Community Action Plan to be implemented in each Area

1 Online: City of Salford <http://www.salford.gov.uk/about/>. 2 Venture Centre, 491 Mill St., Openshaw, Manchester, M112AD, UK. (Email: [email protected], Tel: 0161-2314111, Fax: 0161-2314555). 3 Bridget O’Rourke, Jez Hall and Ed Cox, Building A People’s Budget: Report of the Salford Budget Matrix Study (7 May 2003) [unpublished, available from Community Pride Initiative, supra note 1] at 3 ¶ 1. 4 Online: City of Salford <http://www.salford.gov.uk/council/Wardmap.shtm> [reprinted in modified form with permission from the author]. 5 Supra note 3 at 2. 6 Ibid. at 6, 17.


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6

3

5

8

9 2

7

1

4

1. Broughton and Blackfriars Pop’n: 18,700; IMD2000: 141

2. Claremont, Weaste and Seedly Pop’n: 23,000; IMD2000: 1335

3. Eccles, Winton, Barton Pop’n: 35,500; IMD2000: 917

4. Irlam and Cadishead Pop’n: 18,800; IMD2000: 1783

5. Kersal, Pendleton and Charlestown Pop’n: 22,400; IMD2000: 872

6. Little Hulton and Walkden Pop’n: 38,300; IMD2000: 1354

7. Ordsall and Langworthy Pop’n: 17,300; IMD2000: 213

8. Swinton N&S, Pendlebury Pop’n: 38,400; IMD2000:1882

9. Worseley and Boothstown Pop’n: 13,600; IMD2000: 6108

Figure 3-1. Service Delivery Areas: City of Salford, EnglandSource: Pop’n IMD2000

- population (1998)- Index of Multiple Deprivation ranking (2000)

City of Salford <http://www.salford.gov.uk/council/wardmap.shtm>

Area Electoral Ward(s) Area Electoral Ward(s)


27

over the next fiscal year. Projects are implemented by city departmental directorates or other service providers. In March, the PB process undergoes a review. Finally, Community Committees are responsible for monitoring and evaluating projects as they are implemented.7 3.2. The Salford Budget Matrix System The Salford Budget Matrix utilizes a ranking system similar to the one used in the Porto Alegre PB process. Citizens in each area are asked to rank seven themes in order of local priority from 5 (being the highest priority) to 1 (being the lowest priority). This means that two themes do not receive a rank. The themes are taken from the Salford Community Plan document and are described as follows: (1) A Healthy City; (2) A Safe City; (3) A Learning and Creative City; (4) Valuing Children and Young People; (5) Inclusive City With Strong Communities; (6) Economic Prosperity; (7) Environment and Housing. City-wide priorities are generated by adding up the local priority ranks assigned to each theme by each Area (giving “City-Wide Points”). Each theme is then given a city-wide priority rank, based on the total “City-Wide Points” received, from 7 (highest priority) to 1 (lowest priority). The amount of money from the Investment Fund expended per theme is proportional to the percentage of total “City-Wide Points” each theme receives. In the hypothetical Budget Matrix study, local priorities were derived from the Salford Community Plan document (in an actual PB process, local priorities would be established by citizens during neighbourhood meetings).8 The results are outlined in Table 3-1. Table 3-1: Salford Budget Matrix: Local and City-Wide Priorities9

ThemesA Learning Valuing Children Inclusive City

A Healthy A Safe and Creative And Young with Strong Economic EnvironmentCity City City People Communities Prosperity and Housing

Area Wards Rank Rank Rank Rank Rank Rank Rank1 Broughton and Blackfriars 3 4 2 5 12 Claremone, Weaste and Seedley 4 1 5 3 23 Eccles, Winton, Barton 1 4 2 5 34 Irlam and Cadishead 3 4 1 2 55 kersal, Pendleton and Charlestown 2 1 5 4 36 Little Hulton and Walkden 2 3 5 1 47 Ordsall and Langworthy 3 1 2 4 58 Swinton N&S, Pendlebury 4 5 39 Worsley and Boothstown 3 2 4 5 Totals

City-Wide Points 9 24 7 27 21 18 25 131Percentage 6.87% 18.32% 5.34% 20.61% 16.03% 13.74% 19.08% 100.00%Expenditure per Theme £68,182 £181,818 £60,606 £204,545 £159,091 £136,364 £189,394 £1,000,000City-Wide Priority 2 5 1 7 4 3 6 28

The theme “Valuing Children and Young People” will be used as a continuing example to

describe the Budget Matrix process. As shown in Table 3-1, “Valuing Children and Young People” is the highest city-wide priority (thus assigned a rank of 7), receiving the most points with 27 of 181 total “City-Wide Points” (or 20.61 percent). Therefore this theme is allocated 20.61 percent (or £204,545) of the £1 million Investment Fund. Each of the nine Areas will receive a portion of the £204,545 to be spent on projects related to this specific theme. The amount of money distributed to each area depends on three criteria: (1) local Priority; (2) population and (3) deprivation.

7 Ibid. at 15-8. 8 Bridget O’Rourke, The Salford Budget Matrix 2002/3 (November 2002) [unpublished, available from Community Pride Initiative, supra note 1] at 1-3. 9 Ibid. at 3 [reprinted in modified form with permission from the author].


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Local priorities have already been established and are found in Table 3-1. Each area receives a score based on the percentage of the total population residing in the area (see Table 3-2). Area 1 (Broughton and Blackfriars Electoral Wards) will be used as a typical example. According to the 1998 British Census, Area 1 had a population of 18,700, being 8 percent of the city’s total population. Based on the scoring system found in Table 3-2, Area 1 therefore received a score of 2 for the population criterion.10 The third criterion, deprivation, is based on the Index of Multiple Deprivation 2000 (IMD2000), a unique measure of infrastructure and service deprivation in England. Each of the 8414 Wards in England are ranked according to the assessed levels of deprivation – the most deprived being at the top of the list. Each Area receives a score based on where the Wards composing that Area sit in the IMD2000 ranking, with the most deprived Areas receiving a score of 5 and least deprived a score of 1 (see Table 3-2). Area 1 contains two Wards, Broughton (ranking 126 on the IMD2000) and Blackfriars (ranking 156 on the IMD2000). These two rankings are averaged, giving an “Adjusted IMD2000” ranking of 141 [(126 + 156) ÷ 2 = 141]. This places Area 1 in the second percentile of deprivation (take the Adjusted IMD2000 ranking and divide by the total number of Wards; in this case 141 ÷ 8414 = 2%). Based on the scoring system found in Table 3-2, Area 1 therefore received a score of 5 for the deprivation criterion.11 Table 3-2: Salford Budget Matrix

Criteria Scoring System12 Population DeprivationPercentage of

Population Percentile Score0-5 21+ 16-10 16-20 2

11-15 11-15 316-20 6-10 421+ 0-5 5

Before the three criteria are used to allocate thematic funds to the Areas, each criterion is ‘weighted’, in a similar fashion as is done in Porto Alegre, to ensure that Areas with greater populations or higher deprivation would receive more funding. The Salford Budget Matrix prioritizes deprivation over population, therefore deprivation scores are ‘weighted’ by a factor of 3.5 while population is ‘weighted’ by a factor of 2. In the case of Area 1, the adjusted deprivation score would therefore be 17.5 (5 x 3.5 = 17.5) and the adjusted population score would be 4 (2 x 2 = 4).13 The Budget Matrix, however, differs from the Porto Alegre model in the way it weights local priorities. Instead of assigning local priorities a similar weight as deprivation14, for each Area in Salford the local priority assigned to each theme is weighted by the city-wide rank of each theme.15 For example, Area 1 gave the theme “Valuing Children and Young People” a rank of 2. Since this theme was deemed the highest city-wide priority (with a rank of 7), the adjusted

10 Ibid. at 4. 11 Ibid. at 5. 12 Ibid. at 4-5 [reprinted in modified form with permission from the author]. 13 Ibid. at 6. 14 Boaventura de Sousa Santos, “Participatory Budgeting in Porto Alegre: Toward a Redistributive Democracy” (1998) 26 Politics & Society 461 at 474-475. 15 Supra note 8 at 7.


29

local priority score for Area 1 is 14 (2 x 7 = 14). The effect of this weighting strategy is to give the four highest priority city-wide themes (“Valuing Children and Young People”, “Environment and Housing”, “A Safe City”, and “Inclusive City with Strong Communities”) more weight than the deprivation criterion, and the top five themes (ibid. plus “Economic Prosperity”) more weight than the population criterion. Continuing the “Valuing Children and Young People” example, the allocation of funds from the budget for this theme to each Area (after adjusting for local priority, population and deprivation) is outlined in Table 3-3. Adjusted criteria scores for each Area are summed, and funds are allocated to each Area based on the proportion of total points the Area received.16 Once again using Area 1 as an example, the sum of adjusted local priority, population and deprivation scores is 35.5. Since the Total Points for all Areas combined is 325, Area 1 has 11 percent of those points and therefore is allocated 11 percent (£22,343) of the £204,545 budgeted for this theme. Monies budgeted for each other theme are also allocated to each Area in a similar fashion. As explained above, these funds are then used by the Area Community Committees to commission theme-related local projects from the Area Community Action Plans. Table 3-3: Salford Budget Matrix Area Allocations for “Valuing Children and Young People”17

Adjusted Adjusted Adjusted Area Wards Local Priority Population Deprivation Total Score Percentage Allocation

1 Broughton and Blackfriars 14 4 17.5 35.5 11% £22,3432 Claremone, Weaste and Seedley 35 6 7 48 15% £30,2103 Eccles, Winton, Barton 28 8 10.5 46.5 14% £29,2664 Irlam and Cadishead 14 4 3.5 21.5 7% £13,5315 kersal, Pendleton and Charlestown 0 6 14 20 6% £12,5876 Little Hulton and Walkden 35 8 7 50 15% £31,4687 Ordsall and Langworthy 14 4 17.5 35.5 11% £22,3438 Swinton N&S, Pendlebury 35 8 3.5 46.5 14% £29,2669 Worsley and Boothstown 14 4 3.5 21.5 7% £13,531

Total Points Total325 £204,545

3.3. Critical Analysis of the Salford Budget Matrix Study With the Salford Budget Matrix Study, the CPI should be commended for making an excellent contribution to the development of PB outside of Latin America. However there are four distinct grounds on which the PB process outlined in their report can be criticized. These are: (1) geographical boundary selection, (2) unclear priority identification, (3) unfair Budget Matrix weighting mechanisms and (4) Investment Fund inefficiency. 3.3.1. Geographical Boundary Selection It is recognized that there are pragmatic reasons for utilizing Service Delivery Areas as the intra-city geographical boundaries for the PB process. One is the pre-existence of established Areas and organized Community Committees and another the close connection between PB driven Community Action Plan demands and service delivery. For practical purposes, each city must be capable of utilizing the pre-existing bureaucratic structures when first implementing a PB process (recognizing that new structures can arise after the establishment of the PB process if it is necessary). However three concerns arise with the adoption of the current geographical boundary structure. First, some Areas contain Wards which vary dramatically in their affluence (based on

16 Ibid. 17 Ibid. at 11 [reprinted in modified form with permission from the author].


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their IMD2000 rankings), which can distort the “weighting” process in the Budget Matrix (see “Unfair Budget Matrix Weighting Mechanisms” below). Second, the mechanism of accountability for the Community Committees, which play a pivotal role in the PB process due to the use of the Area boundaries, is not established.

Finally, it is not clear what the role of city councillors, who represent the Wards within the outlined Areas, play in the PB process. This question was in fact raised in the Salford Budget Matrix Study18 but not addressed in the model. A clear role for city councillors bring two important benefits. First, as will be made clear in Chapter 4, the success of PB relies on the committed support of the relevant government, in this case City Council. With no clear role that is visible to their constituents, there is little political incentive for councillors to engage or support the process. Second, since the PB process relies on the civil service for important technical knowledge and advice (e.g. project feasibility), the involvement of city councillors creates a visible line of accountability and political recourse for citizens if the civil service does not “pull its weight” in the process. With a political stake in the PB process, councillors have an incentive to ensure that the civil service completes its PB tasks in a timely fashion. 3.3.2. Unclear Priority Identification The most obvious criticism of the Budget Matrix study is the use of broad, undefined themes. What is “A Healthy City”? “A Safe City”? “A Learning and Creative City”? The question of giving meaning to the themes (and who would do so) was raised by Salford Department directorates19 but was not answered by the CPI in their study. The lack of clarity presented by the themes has several important consequences for the Salford PB model. First, the type and kind of ideas for possible projects (solicited from citizens) during the process remains unclear. What criteria must projects meet to fall under a specific theme? Second, project vagueness leads to an inability to estimate the cost of typical projects under each theme. Some themes appear, at least “on their face”, to be capital intensive (such as “Environment and Housing”), thus requiring larger sums of money for proposed projects. This leads to the final consequence being the possibility of Budget Matrix inefficiencies. Since each Area is allocated some money for each theme, there is likely to be a lack of fit between proposed projects and the monies allocated to fund those projects. This will be dealt with in greater detail below. 3.3.3. Unfair Budget Matrix Weighting Mechanisms As noted above, the Budget Matrix utilizes ‘weighting’ measures to make sure that Areas with greater populations or higher deprivation would receive more funding. However the CPI’s use of city-wide rankings to weight local priorities, and IMD2000 data to weight deprivation, in fact work counter to their stated goal in certain circumstances. As already mentioned, weighting local priorities by city-wide rank elevates the influence of four themes above the deprivation criterion, and five themes above the population criterion. Such a strategy effectively rewards Areas who had similar priorities as the city-wide priorities with greater funding, while punishing those Areas that established different priorities. This result is clearly inconsistent with the stated goal of redistributing funds according to deprivation and population.

Recall also that the Budget Matrix adjusts deprivation scores by averaging the IMD2000 rankings of the Wards within an Area. This practice causes little distortion if the Wards within an area are similarly ranked – for example Area 1 contains two Wards, Broughton and Blackfriars, 18 Supra note 3 at 4. 19 Ibid. at 4.


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which have respective IMD2000 rankings of 126 and 156. However, distortions are introduced in Areas that contain Wards with significant differences in IMD2000 rankings (‘significant’ being defined as 3-fold or greater). For example, Area 2 contains two Wards, named Claremont and Weaste and Seedly, with respective IMD2000 rankings of 2099 and 570, making Claremont three-times more affluent than Weaste and Seedly. Averaging these rankings (average IMD2000 ranking of 1335), places Area 2 within the 16th percentile of deprivation, giving this Area a score of 2 (see Table 3-2 above). Were the two Wards to be considered separately, Claremont would have received a lower deprivation score of 1 since it falls within the 25th percentile of deprivation – Claremont would therefore receive less funding from the Budget Matrix; Weaste and Seedly would have received a higher score of 4 (7th percentile of deprivation), and would have received more funding. The end result of the current weighting system is to artificially inflate the deprivation of more affluent Wards (like Claremont) while simultaneously under-representing the deprivation of poorer Wards in the same Area (like Weaste and Seedly). Such a situation exists in 5 of the 9 Areas (those being Areas 2, 3, 5, 6, and 8). This appears to be an unavoidable consequence of the geographical boundaries used in the Budget Matrix study. 3.3.4. Investment Fund Inefficiency The Salford PB model utilizes a Budget Matrix to allocate Investment Fund monies to the Areas. Both a Budget Matrix and an Investment Fund are useful tools for PB, however this author feels that the case justifying the use of a Budget Matrix to devolve Investment Fund monies has not been adequately met by the CPI. An Investment Fund can become economically inefficient when those funds are distributed by a Budget Matrix like the one described in the Salford PB model. To be efficient, the Budget Matrix must be capable of matching funding with project ideas; the reliance of the Salford system on the prioritization of broad and undefined themes, rather than specific and defined projects, significantly diminishes the probability that the Budget Matrix will distribute Investment Fund resources in an efficient way. The projected result is that some Areas may receive more money than is needed to meet project demands while other Area projects may suffer due to a lack of sufficient resources.

Nevertheless, one may counter that economic efficiency is not the primary purpose of the Budget Matrix process and that it is sufficient that the funds allocated by the Salford model will be put to some constructive use by the people of the Areas. To vindicate this counter-argument, one must first answer the question “Will theme-based funds allocated to each Area actually be spent?” in the affirmative. Unfortunately, historical evidence from Salford appears to belie this question. The CPI admits that there is evidence that a £250,000 grant fund, devolved per capita to each Community Committee to fund local group projects, has not been fully spent in recent years20, and offers no argument that this trend would not continue with the £1 million Investment Fund.

Second, the CPI argues that “(o)ne of the advantages of the budget matrix is that…each area is allocated something.”21 Yet the salutary effects of ensuring ‘everyone gets something’ are to this author not so readily apparent. The £1 million Investment Fund amounts to only 0.4 percent of the total 2002/03 Salford budget.22 Are citizens necessarily best empowered or served by diluting these funds to individual Areas, particularly given the broad theme-based goals of the

20 Ibid. at 8. 21 Supra note 3 at 7 ¶ 5. 22 “How we managed resources in 2002/03” (30 June 2003), online: City of Salford <http://www.salford.gov.uk/council/gudget/summary_variations.shtm>.


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Salford PB process? As already mentioned, one can easily imagine situations where Areas are allocated sums of money which, on their own, are too minimal to fund effective programs. The Salford study fails to demonstrate that any amount of money which the Areas receive for any theme can be utilized to fund meaningful and effective projects.

There are numerous examples within the Budget Matrix Study of funding allocations that will likely be insufficient to create effective Area programs. The top five themes received at least twice as much funding as the two lowest priority themes (recall Table 3-1 above), but compared to Salford city budget allocations in related areas, they are not substantial. The highest priority theme “Valuing Children and Young People” received £204,545 – 0.2 percent of the £118 million Salford Education budget and 0.3 percent of the Community and Social Services budget. The “Environment and Housing” theme, likely a capital intensive area, received £189,394 – 2 percent of the combined Salford Environmental Services and Housing General Fund budgets. The “Economic Prosperity” theme was allocated £136,364 – just over 1 percent of the Salford Planning & Economic Development budget.23 The two lowest-priority themes, “A Healthy City” and “A Learning and Creative City”, were allocated £68,182 and £60,606 respectively. Regarding the “A Learning and Creative City” theme, its allocation is a pittance compared to the analogous Salford Arts & Leisure budget of £15 million.24 With what appears to be so little money, particularly after the funds are distributed to the nine Areas, the ability of citizens to truly make meaningful budget decisions, and to create programs that promote these broad themes, becomes questionable.

One potential solution is to allow Areas to trade allocated resources. If, for example, Area 9 wishes to implement a capital intensive project under the “Environment and Housing” theme, but lacks sufficient funds, it could approach other Areas and seek to trade funding from another theme for more “Environment and Housing” money. Alternatively, Areas could be empowered to re-allocate funding from their own lower-priority themes to higher-priority themes. Such practices, however, diminish the integrity of the Budget Matrix process. If Areas can move funding around at will, what is the merit of the elaborate mechanism to establish citizen priorities? In addition, such practices would only multiply Area bureaucracy with no clear accountability. 3.4. Conclusions The PB model presented by the CPI in the Salford Budget Matrix Study is a respectable first attempt at theoretically adapting PB to cities outside of South America. The use of an Investment Fund to provide resources for local initiatives, as well as a Budget Matrix system to allocate resources according to citizen priorities should be incorporated into a PB model for Canadian cities. Nevertheless, there are various deficiencies in the Salford model which must be improved upon in the development of a new Canadian model. These include the use of geographical boundaries that provide a role for city councillors, clear and concise themes, a fair weighting system for the Budget Matrix and a method of resource allocation that promotes economic efficiency and project effectiveness together with citizen priorities. Based on these and other lessons, in the next chapter a new PB model for Canadian cities will be presented.

23 Ibid. 24 Ibid.

Chapter 4 A Participatory Budget Model for Canadian Cities

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Chapter 4 4. A Participatory Budget Model for Canadian Cities 4.1. Participatory Budgeting in Canada

A very limited number of Canadian municipalities have attempted to increase citizen participation in the city budgeting process. In these cases, public input was generally obtained through consultative mechanisms such as public forums, citizen advisory committees and community surveys.1 To date, no Canadian municipality has attempted to delegate budgetary decision making authority to citizens through a PB process. In this final chapter, a theoretical PB model for Canadian cities will be presented.

If PB is to be implemented in Canadian municipalities, all involved must be prepared for a slow and chaotic start2, with initial low levels of participation, similar to what was reported by Iria Sharon, coordinator of Community Relations in the first PT government in Porto Alegre: “We idealized popular recommendations a lot. We thought that by taking over the leftist government in Porto Alegre, all the people would be interested in participating in administering the city. But, in reality, this did not occur.”3

PB has been implemented successfully in Brazilian cities that range in size from 100,000 to nearly 2 million people.4 Therefore PB could, in theory, be introduced to both small Canadian cities, such as Kingston, and large urban centres like Toronto. Daniel Schugurensky, a professor at the University of Toronto (OISE) who has studied the PB process in Porto Alegre, has commented on the applicability of the Brazilian PB model to Canadian municipalities. He argues that any PB model must “take into account context, the democratic traditions and the political culture of Canadian cities.” 5 Studies of PB projects have identified a series of basic conditions that appear to be required for the successful implementation of PB. Those conditions that are relevant to the Canadian municipal context will now be considered. 4.1.1. Conditions Required to Successfully Implement Participatory Budgeting

It is argued that an essential factor required for the success of a PB project is that the relevant government (usually a progressive, or left-based party) must be committed to its implementation.6,7 The government must also have the organizational capacity (e.g. personnel, resources, analytic and political management skills8) to implement the PB program, and its

1 W. Michael Fenn, “Expanding the Frontiers of Public Participation: Public Involvement in Municipal Budgeting and Finance”; Edward C. Lesage Jr., “Public Participation in the Budgeting Process: Edmonton’s Ongoing Experiment” in Katherine A. Graham & Susan D. Phillips, eds., Citizen engagement : lessons in participation from local government (Toronto: IPAC, 1998). 2 Angie Gallop, “Porto Alegre, Canada?” (7 January 2003), online: Rabble <http://www.rabble.ca/rabble_interview.shtml?sh_itm=e48dde15c2a9b91de0db4cf72adb1fc7&r=>. 3 Marta Harnecker, “Delegating Power To The People: Participatory budget in Porto Alegre,” online: The World Bank <http://www1.worldbank.org/wbiep/decentralization/laclib/harnecker.pdf> ¶ 41. 4 Brian Wampler, “A Guide to Participatory Budgeting” The International Budget Project (October 2000), online: <http://www.internationalbudget.org/resources/library/GPB.pdf> at 28. 5 Supra note 2. 6 Jeremy Heimans, “Strengthening Participation In Public Expenditure Management: Policy Recommendations For Key Stakeholders” The Organization For Economic Co-operation and Development (2002), online: OECD <http://www.oecd.org/pdf/M00037000/M00037848.pdf> at 11. 7 Supra note 4 at 23. 8 Supra note 6 at 19-20.


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implementation should not alienate key political constituencies (e.g. the middle class).9 It is also critically important that the government cede some decision-making power to citizens. Limiting citizen involvement to a consultative role does not provide an incentive for participation. Citizens must feel that the priorities they establish will be acted upon. Without delegating some decision-making power, citizen priorities can fall prey to political or technocratic manipulation10, which often leads to the failure of the participatory model.11

Another key requirement for PB success is the timely delivery of projects selected by the participants. Brian Wampler reports that “(w)hen the government successfully implements selected projects, it reinforces the notion that participation in PB is a valuable tool for promoting change…there is a general consensus that PB stimulates participation because decisions made by participants result in actual policy changes.”12 He warns, however, that in the process participants must be mindful not to allow the PB process to inhibit long-term planning for the city by focusing primarily on district-level public works.13

The pre-existence of organized networks of social movements, community organizations and voluntary organizations, which would provide support for the PB system, is also deemed to be required. It is beneficial if these organizations are already involved in budget consultations or budget monitoring.14 Finally, discretionary funding must be available (12 to 15% of total budget expenditures15), such that citizens can participate in meaningful deliberations about new public works.16 If PB is to be imported into the governance of Canadian cities, it must be determined if the contemporary political culture satisfies or can satisfy these basic requirements.

Whether or not a municipal government will fully support the implementation of PB can only be assessed on a case-by-case basis. Organized municipal political parties are not widespread in Canada. One notable exception is the Coalition of Progressive Electors (COPE), who swept the November 2002 Vancouver elections, winning the mayoralty and eight of ten council seats in Canada’s third largest city.17 It is therefore possible that organizations such as COPE could promote the implementation of PB in a Canadian municipality (presuming that the party would be willing to surrender the required budgetary power). Given that Canadian municipalities are generally sophisticated organizations, they likely carry the capacity to implement a PB system if the political will exists. As explained in Chapter 2, the Brazilian experience indicates that implementing PB actually improves the electoral success of the political party and increases the legitimacy of governing institutions.18,19 Governments in Porto Alegre find broad based political support for PB programs, often because PB generally redistributes goods and services to low-income areas. In addition, PB, at least in the Latin American context,

9 Ibid. at 12. 10 Supra note 4 at 24. 11 Supra note 6 at 22. 12 Supra note 4 at 15 ¶ 3. 13 Ibid. at 23. 14 Supra note 6 at 12, 21; note 4 at 6. 15 Supra note 4 at 7. 16 Supra note 6 at 12. 17 John Ferry “New mayor gets over nightmare, but will the people of Vancouver?” Vancouver Province (17 November 2002) A4; “Vancouver's provincial role: B.C.'s biggest city turns to the left, setting the stage for a Campbell vs. Campbell battle,” Editorial, Victoria Times Colonist (18 November 2002) A6. 18 Gianpaolo Baiocchi, “Participation, Activism, and Politics: The Porto Alegre Experiment and Deliberative Democratic Theory” (2001) 29 Politics & Society 43 at 61-2. 19 Supra note 6 at 9


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has reduced corruption, decreased bureaucratic inefficiency, and improved service quality, all of which appeal to the middle classes. 20

Political parties are not the only beneficiaries of PB. Citizens benefit by gaining valuable educational opportunities regarding municipal governance21, and through the process develop the citizenship values22 predicted by advocates of participatory democracy (outlined in Chapter 1). More importantly, citizens gain access to both information and the local decision-making apparatus, empowering them to make real decisions concerning the development of their neighbourhoods.23 Both voluntary associations and non-governmental organizations (V/NGOs) benefit since they gain the opportunity to recruit more members and form broader coalitions in the community. These organizations often play key roles in mobilizing citizens to take part in the PB proceedings, and act as ‘watchdogs’ by monitoring the PB process.24 Finally, the business community can also benefit from PB through the implementation of city development projects and the more efficient use of city tax dollars.25

4.1.2. Canadian Participatory Budgeting Challenges

The two prerequisites that may present a challenge for the successful implementation of PB in Canadian cities are the availability of adequate discretionary funds, and the presence of an organized civil society willing to engage in the PB process. Municipalities generally establish an annual discretionary capital budget for public works valued at 10 percent of the operating budget. Other sources of discretionary funding can be found in the operating budget (such as department community grant funds), the control of which could be transferred to citizens through the PB, however a word of caution must be made. Municipalities, under the Canadian Constitution, are ‘creatures of the province’. The fiscal health of a municipality, and hence its ability to generate the discretionary funds required for PB, is therefore remarkably dependant on the actions of its provincial masters. Transfer cuts or downloading of service responsibilities from the province to municipalities would compel cities to make fiscal adjustments, which may have negative effects on any PB process, to ensure that they balance their budgets (recall that it is illegal for municipalities to run operating deficits). Such provincial practices have become commonplace in Ontario over the past two decades. The resulting strain placed on municipalities could make an attempt to implement PB difficult.

Fiscal constraints notwithstanding, Schugurensky has speculated that the relative affluence of Canadian cities may soften citizen’s motivation to participate.26 Such a theory is not without basis. Aaron Schneider and Ben Goldfrank conducted a study of municipal participation in the PB process for the Brazilian state of Rio Grande do Sul. They found that as industry and population in a municipality rise, participation in the PB falls. The drop in participation is not 20 Supra note 4 at 17-21, 25-6. 21 Quoting Angelica Marinha (Regional Coordinator) “We clearly learned how the city functions; how income is distributed; who has power and who doesn’t. We learned about the Chamber of deputies, the mayoralty, the councilmen; what departments coordinate the city; the issue of sewage; the taxation system, income.” Supra note 3 ¶ 275. 22 Quoting Neonilse Guimaraes (Education Consultant) “But as they got paved streets, a steady water supply and schools they began to see things from a more social point of view and that changed the relationship of these persons with their neighbourhoods and city. What began as a simple search to rapidly improve living conditions was transformed into citizen values.” Supra note 3 ¶ 189. 23 Supra note 4 at 25; note 18 at 54. 24 Supra note 6 at 6, 21-2; note 18 at 60. 25 Supra note 4 at 17-21, 25-6. 26 Supra note 2.


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directly proportional. For every 1 percent increase in industry there is a 0.12 percent drop in participation, while for every 10,000 person increase there is a decrease of 0.17 percent. However they also found that the PB process does have a built-in positive feedback mechanism. In Rio Grande do Sul it was found that municipalities that had higher proportional participation also received more investment – 0.71 reais (Brazilian currency) per capita more in investments for each percentage increase in participation.27 Clearly this study is not conclusive regarding Canadian municipalities, and the possible effects of Canadian affluence on PB participation remain speculative. Nevertheless, this issue merits consideration in the development of a Canadian PB model.

As previously described in Chapter 2, Porto Alegre already had a strong and highly organized civil society prior to the implementation of PB.28 Decima research polls indicate that 65 percent of Canadians are involved in V/NGOs. Only one-third of Canadians belong to V/NGOs pursuing social or public issues. Most importantly, members of these organizations tend to have higher levels of education and income.29 This raises two concerns. First, the capacity of V/NGOs to support a PB system, which is reported to be essential for the successful implementation of PB, becomes debatable. Finally, the class bias of Canadian V/NGOs calls into question the ability of these organizations to adequately represent the interests of lower-income citizens in PB deliberations. A Canadian PB model must be adapted to address these problems. Jeremy Heimans suggests that phasing in PB over time, as is being done in Bangladesh at the national level, may increase the chances of successful implementation. Beginning in 1995, Phase 1 of the Bangladeshi project involved a systematic review of the current budget process, including levels of participation and the allocation of resources. Phase 2 involved a participatory appraisal study, which determined citizen’s understanding of the budget process and its impact on their lives. Currently in Phase 3, the group is advocating for a PB process using a variety of instruments including decentralization of budget resources to local governments, formal consultations, citizen juries, opinion polls and social attitude surveys.30 The gradual ‘phasing-in’ of PB is a tactical issue, the analysis of which is beyond the scope of this paper. In any case, no group will proceed to ‘phase-in’ PB unless a model is available. It is to the description of this new model we now turn.

4.2. A Canadian Participatory Budgeting Model In previous chapters I presented criticisms of the two known PB models – one implemented in Porto Alegre, Brazil, the other a theoretical model developed in Salford, England. Both models contain unique and innovative structures which are essential for a successful Canadian PB model. However, both models contain components which I will argue should not, at least in the beginning, be adopted in a PB model for Canadian municipalities.

In Chapter 1 I argued that the quality of representation in Canadian governments is currently inadequate, largely due to deficiencies in the democratic conditions of participation, deliberation and political equality. That being said, the COP council from the Brazilian PB model, being a group of elected representatives of civil society (V/NGOs), would likely be no 27 Aaron Schneider and Ben Goldfrank, “Budgets and ballots in Brazil: participatory budgeting from the city to the state” Institute of Development Studies (January 2002), online: IDS <http://www.ids.ac.uk/ids/bookship/wp/wp149.pdf> at 17-8. 28 Supra note 3 ¶ 38. 29 George Perlin, The Democratic Citizen: Canadian Democracy in Critical Perspective, Chapter on Group Politics (Toronto and Kingston: CBC Newsworld and Queen’s University, 2002). 30 Supra note 6 at 26.


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more representative than city councillors in a Canadian PB model. Therefore such a council should not be imported into a Canadian model. With the current climate of service downloading and fiscal restraint it is likely that an Investment Fund generated by ‘top-slicing’ department budgets, similar to that found in the Salford model, would be strongly resisted. However an Investment Fund could be generated by pooling department funds allocated for community grants. In addition, a city’s capital budget could be placed under control of the PB. If such resources could be made available, their distribution through the use of a Budget Matrix would not be justified given the questions surrounding the efficiency and effectiveness of doing so in the Salford model, which was outlined in Chapter 3. If a “Salford-like” Budget Matrix is employed, it must use a weighting mechanism that is fair and consistent with the goals of the PB model. Unlike the Porto Alegre and Salford models, a clear role for city councillors (as a means to bolster government support for the process) must be found in a Canadian PB model. Such a role is intimately linked to the choice of geographical boundaries, therefore a Canadian model should utilize boundaries with this role in mind. A Canadian model must, at least in the beginning, integrate PB into the already existing bureaucratic structures as a means to avoid chaos in the civil service and ensure their support for the program. Therefore, bureaucratic structures like the Brazilian GAPLAN and CRC should not be initially imported into Canadian PB. Finally, the themes or areas which citizens prioritize during the PB process must reflect the concerns of Canadian citizens; this means they will likely differ from those outlined in the Brazilian PB model. Still, Canadian themes should be more focused than those presented in the Salford model, so citizens have a clearer understanding of what it is they are prioritizing.

Figure 4-1 presents an overview of the proposed Canadian PB model. I will use budget information from the city of Kingston, Ontario, to elaborate on the proposed model – it is important that readers keep in mind that the PB model presented below is not meant to be definitive and is open to adaptation and innovation.

The PB process is divided into six phases: (1) Preparation and Mobilization; (2) District PB Meeting; (3) Budget Matrix and Project Development; (4) Debriefing and Community Committee Establishment; (5) Deliberative Budget Council (DBC) Proceedings and (6) Implementation and Oversight. 4.2.1. Phase 1 – Preparation and Mobilization (January-April) Neighbourhood meetings will be organized for each electoral district in a city – in Kingston there are 12 such districts. City councillors representing each district are responsible for advertising and organizing three meetings. The first is the Preparatory Meeting. At this meeting the city councillor is responsible for introducing and explaining the PB process to their constituents. He/she must outline the themes to be prioritized, the Budget Matrix system that will distribute funds to those themes, and the rules for deliberation (e.g. speaking time limits) and priority setting (which could be simple majority voting, consensus, or a combination of both). Citizens must also be informed that ideas for large capital projects (funded by the capital budget) or smaller local projects (if an Investment Fund is generated) will be collected at the District Meeting. The DBC (see Phase 5 below) and its function in selecting capital and local projects will also be explained. Citizens must be encouraged to mobilize their district to participate in the upcoming District Meeting.


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Phase 1: Preparation and Mobilization(January to April)

City councillor chairs preparatory meetingin his/her district

- themes- deliberation rules- priority setting- ideas for projects- role of DBC

Mobilize citizens to prepare for District PB Meeting

PB process explained

Phase 2: District PB Meetings(May/June)

Citizens deliberate on priority of themesCitizens rank themes in order of priority

City councillor chairs meeting in his/herdistrict

Gather ideas for projects

Phase 3: Budget Matrix and Project Development(May to September)

Priorities entered into Budget Matrix- adjustments made for population, low-income and participation (if necessary)

Project ideas sent to civil service departments- assess feasibility of project ideas- cost-assessment for feasible projects- develop implementation strategies

Selection of DBC

Phase 6: Implementation and Oversight(Next Fiscal Year)

Community Committee oversee projectimplementationAccess to city councillor if problems arise

Phase 5: Deliberative Budget Council (DBC) Proceedings(November/December)

DBC deliberates on proposed projectsProjects are ranked by each DBC memberProjects are prioritized according to rankHighest priority projects are commissioneduntil funding is extinguished

Phase 4: Debriefing and Community Committee Establishment(October/November)

Chaired by city councillor is his/her districtReport on: (1) Budget Matrix allocations

(2) Implementation strategies for feasible projects

Establish volunteer Community Committeeresponsible for oversight of selected projects

Figure 4-1. Overview of Proposed Canadian PB Model


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4.2.2. Phase 2 – District PB Meeting (May/June) Each councillor will chair their District PB Meeting. Only citizens who live in the district are allowed to participate. At the meeting, citizens will debate the value of each theme within their community and rank them in order of importance. Themes will likely vary from city to city, however there are two general properties that themes should meet. Each theme should be (1) a service that has historically been allotted funds in the city budget and (2) a service that generally is of importance to all districts (e.g. road maintenance). As an example, the following themes are suggested for the city of Kingston: Roads, Social Housing , Street Safety, and Waste. Table 4-1 outlines in detail what services are involved in each theme and the funds allocated to them in 2002 (totaling 9.5 percent of the operating budget). Citizens would rank these themes in order of importance, 4 being the highest priority and 1 being the lowest. In addition, ideas for capital or small local projects (if applicable) will be collected at this meeting. Table 4-1: Proposed Themes for the City of Kingston31 Theme Services 2002 Budget AllocationRoads Street Cleaning $6,587,375

Road MaintenanceSidewalk MaintenanceWinter Control

Social Housing Programs $6,537,682Street Safety Street Light Maintenance $1,154,329

Traffic Light MaintenanceWaste Garbage Collection & Disposal $6,866,970

Recycling Collection & ProcessingLeaf CollectionHousehold Hazardous Waste

Total $21,146,356 4.2.3. Phase 3 – Budget Matrix and Project Development (May-September) 4.2.3.1. The Budget Matrix (May/June)

Funds from each theme will be allocated to each district using a Budget Matrix system similar to that employed in the Salford model. Other criteria, together with the district priority criterion established in Phase 2, can be utilized to adjust the percentage of funds that will be distributed to each district for each theme (see Table 4-2). Like the Porto Alegre and Salford models, districts that contain a higher proportion of the total population could be given a higher score than those with fewer citizens. Table 4-2 offers the same population scoring system found in the Salford model. It is used as an example only – these numbers can and should be adjusted to meet the needs of each individual city.

Since Canada does not currently have a ‘Needs’ or ‘Deprivation’ measure (like Brazil and England), it is recommended that, should a city so choose, adjustments be made for low-income using the new Market Basket Measure of Low Income (MBM) developed by Human Resources

31 City of Kingston, By-law No. 2002-71, A By-law To Adopt The 2002 Operating Budget (5 March 2002) pp. 13-15, 19.


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Development Canada.32 Three factors make the MBM a potentially more useful measure of low-income in Canada than the traditionally used Low-Income Cut-Offs (LICOs) and Low-Income Measure (LIM). First, MBM utilizes a more stringent definition of disposable income – that being monies available for the purchase of goods and services33 after taxes and after adjusting for essential costs.34 Second, MBM is a “goods and services” indicator of low-income (linking disposable income and the ability to meet needs through the purchase of a set ‘basket’ of goods and services) and is therefore not as relative a measure as LICOs and LIM (which look solely at income). Finally, MBM measures are adjusted to reflect differences in incomes and the cost of goods and services across various geographical locations and various community sizes.35

Kingston is a city of over 100,000 people. The MBM for an Ontario city between 100,000 and 500,000 people is $24,53936; therefore those reference families37 that have disposable incomes below $24,539 are considered low-income. In Ontario, 9.2 percent of reference families are considered low-income by the MBM measure.38 On average, those considered low-income have a yearly disposable income that is 27.4 percent lower than the MBM (or $17,815).39 It is therefore suggested that districts with an aggregate MBM of $17,815 or below receive a score of 5, while those with an aggregate MBM higher than the threshold of $24,539 (and therefore not considered low-income) be given a score of 1. Districts with aggregate MBMs in between will receive a score of 2, 3, or 4 (see Table 4-2). Of course, the use of the MBM as a criterion relies on the ability to generate district level aggregate MBM data. Since this is a new measure such data may not yet be readily available. Therefore, in the interim, cities may have to use either LICOs or LIM to adjust for low-income in electoral districts. Table 4-2: Examples of Budget Matrix Criteria

Population Low-Income ParticipationPercentage of MBM

Population (2000) # Participants Score0-5 $24,540 or greater 0-25 16-10 $22,298-$24,539 26-50 2

11-15 $20,057-$22,297 51-75 316-20 $17,816-$20,056 76-100 421+ $17,815 or below 100+ 5

Another criterion that could be used is an adjustment for citizen participation in the PB

district meeting (Phase 2). Such a ‘participation criterion’ would reward districts having higher 32 Applied Research Branch: Strategic Policy - Human Resources Development Canada, “Understanding the 2000 Low Income Statistics Based on the Market Basket Measure” (May 2003), online: Human Resources Development Canada <http://www.hrdc-drhc.gc.ca/sp-ps/arb-dgra/publications/research/2003docs/SP-569-03/e/SP-569-03_E_toc.shtml>. 33 “Goods and services” include food, clothing, shelter, transportation, personal/household needs, furniture, telephone, reading, recreation and entertainment. Ibid. at 4. 34 “Essential costs” include non-insured health spending, alimony or other support payments, mandatory payroll deductions, and Employment Insurance/Canada Pension Plan deductions. Ibid. at 36. 35 Ibid. at 35-37. 36 Ibid. at 59 [values are for the year 2000]. 37 A ‘reference family’ is defined as a two-parent family with two dependent children. The MBM can be adjusted to reflect different ‘family units’, however the ‘reference family’ is used since the two child household is still representative of the largest share of Canada’s population. Ibid. at 35. 38 Ibid. at 17. 39 Ibid. at 28.


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participation rates with a greater probability of receiving more funds from the Budget Matrix (see Table 4-2). This would create an incentive for citizens to participate in and support the PB process, and thus add to the legitimacy of PB budget allocations. It is recognized that such a criterion is subject to criticism. A participation criterion would create an incentive for ‘meeting stacking’ – a situation where individuals are recruited to attend the meeting and ensure a high participation score, but either have no intention to meaningfully participate or will be actively excluded from deliberations. Likewise, some districts may have greater intrinsic organizing capacity than others – some may have greater access to resources (relative affluence), a greater concentration of V/NGOs, and have a greater concentration of people in a smaller land base (e.g. downtown as opposed to rural districts). The use of this criterion is therefore best left to the discretion of PB organizers.

Finally, as in the Porto Alegre and Salford models, each criterion can be weighted to emphasize certain criterion over others in the Budget Matrix. How a city chooses to weight criteria is entirely discretionary (criteria are generally given a weight between 2 and 4). The decision can be made by City Council, the PB participants or the DBC. I argue that the DBC would be best suited to weight each criterion, given that it is a representative sample of the city population (see Phase 5 below). For every theme, each districts’ criterion score (priority, population, low-income, participation) is multiplied by the criterion weight (between 2 and 4) to give an ‘adjusted score’ for each criterion. These adjusted scores are then fed into the Budget Matrix. For each theme, the adjusted scores for every district are summed (to give Total Points) and the proportion of thematic funds allocated to each district by the Budget Matrix is equivalent to the district’s proportion of Total Points.

As a hypothetical example, assume that Phase 2 of the PB process has been completed in Kingston’s 12 electoral districts. The results of this hypothetical are presented in Table 4-3 for the “Roads” theme only. Table 4-3: Hypothetical Table Outlining Kingston District Criteria Scores For “Roads” Theme40

THEME: ROADS Criteria Score

District Priority Population Low-Income Participation1 4 5 1 52 3 4 2 43 2 3 3 34 1 2 4 25 4 1 5 16 3 4 1 47 2 3 2 38 1 2 3 29 4 1 4 110 3 3 5 311 2 2 1 212 1 1 2 1

40 These scores are all hypothetical and do not reflect the priorities, population, low-income or participation of Kingston citizens.


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Now assume that a hypothetical Kingston DBC has chosen to give the population criterion a weight of 4, the priority and low-income criterion each a weight of 3 and the participation criterion a weight of 2. After weighting criteria scores, the adjusted scores are fed into the Budget Matrix as described above. The results are presented in Table 4-4. Each district receives a proportion of the total “Roads” budget which will be used for street cleaning, road and sidewalk maintenance and winter control (recall Table 4-1). 4.2.3.2. Project Development (July-September) The ideas for small and large-scale projects gathered at the district PB meetings will be gathered and sent by city councillors to the appropriate civil service department for feasibility assessments. These assessments must be completed in time for the debriefing meeting in Phase 4. The civil service can also develop ideas for large and small-scale projects at this time. Table 4-4: Hypothetical Budget Matrix District Allocations For “Roads” Theme

THEME: ROADS Adjusted Criteria Score

District Priority Population Low-Income Participation Total Score Percentage Allocation1 12 20 3 10 45 12% $790,4852 9 16 6 8 39 10% $685,0873 6 12 9 6 33 9% $579,6894 3 8 12 4 27 7% $474,2915 12 4 15 2 33 9% $579,6896 9 16 3 8 36 10% $632,3887 6 12 6 6 30 8% $526,9908 3 8 9 4 24 6% $421,5929 12 4 12 2 30 8% $526,99010 9 12 15 6 42 11% $737,78611 6 8 3 4 21 6% $368,89312 3 4 6 2 15 4% $263,495

Total Points Total375 $6,587,375

4.2.4. Phase 4 – Debriefing and Community Committee Establishment (October/November) The civil service will develop a document outlining (1) implementation strategies (including a cost-assessment) for projects ideas that were found to be feasible, and (2) why certain projects were not found to be feasible. This document will be sent to each city councillor, who must hold a debriefing meeting in his/her district to explain the proposed projects and the reasons for not moving forward with those projects deemed non-viable. The results of the Budget Matrix will also be presented at this meeting. Finally, citizen volunteers will form a Community Committee in each district to monitor the implementation of any local projects that are chosen to be put into action in Phase 6. 4.2.5. Phase 5 – Deliberative Budget Council (DBC) Proceedings (November/December) The DBC is a unique innovation in the proposed Canadian PB model. It is an adaptation of James Fishkin’s work on “deliberative polling.” Fishkin developed the deliberative poll in response to his and others’ criticisms of modern day polls, namely that information derived from polls is largely inaccurate because these polls “fail to distinguish between people’s top-of-the-


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mind, offhand, views (mass opinion) and their thoughtful considered judgment (public judgment).”41 Here is how Fishkin describes a deliberative poll:

The idea is simple. Take a national random sample of the electorate and transport those people from all over the country to a single place. Immerse the sample in the issues, with carefully balanced briefing materials, with intensive discussions in small groups, and with the chance to question competing experts and politicians. At the end of several days of working through the issues face to face, poll the participants in detail. The resulting survey offers a representation of the considered judgments of the public – the views the entire country would come to if it had the same experience of behaving more like ideal citizens immersed in the issues for an extended period.42

Replace the words ‘national’ and ‘country’ with ‘municipal’ and ‘city’ and Fishkin’s quote essentially describes the DBC. The distinguishing feature of the DBC, however, is its overall purpose – instead of offering an opinion on an issue, the DBC’s purpose is to deliberate on the merits of proposed city projects (those brought forward from Phase 4) and decide which projects are to be funded. Analogizing Fishkin’s description of the deliberative poll, the DBC idea is also simple. Sometime after Phase 2 a municipal random sample of the electorate is taken (this will likely have to be contracted out to a private polling company - the size of the sample will vary with city size). Immerse this sample with balanced information on proposed projects, allow for intensive discussions in small groups on the merits of the projects, and provide the sample access to politicians, civil servants and V/NGO representatives for questioning. At the end of a weekend of deliberation, have the participants individually and anonymously rank the priority of projects using a numerical scale (e.g. 1 to 10 points, with 10 being highest priority). Projects are then ordered from highest priority to lowest based on the total points received (if deemed appropriate, adjustments could be made for criteria like population or low-income as is done in the Budget Matrix). Projects are commissioned in order of priority until available funding is extinguished (as mentioned earlier, large capital projects could be funded from the capital budget, while smaller projects could be funded through an Investment Fund). The resulting prioritized list of projects is representative of the considered judgments of the public – the views the entire city would come to if it had the same experience of behaving more like ideal citizens immersed in the issues, like those participating in the DBC. Certain conditions must be met to ensure the DBC functions as outlined above. First, the DBC must be representative of the city population. Second, citizens selected to serve on the DBC must have adequate incentive to do so. Finally, the process must create an environment which increases the likelihood that deliberations will influences the participants’ final decisions – if the process has no impact on decision-making, there is little use in holding DBC proceedings. To date, there have been 19 deliberative polls (nine national, nine regional) in three separate countries (U.S.A., England, Australia).43 Of these, only two polls (the 1994 national deliberative poll on crime in England and the 1996 National Issues Convention deliberative poll in the

41 Daniel Yankelovich, Coming to Public Judgment: Making Democracy Work in a Complex World (Syracuse: Syracuse University Press, 1991) at xii. 42 James S. Fishkin, The Voice of the People: Public Opinion and Democracy (New Haven, Conn.: Yale University Press, 1995) at 162 ¶ 3. 43 Robert C. Luskin, James S. Fishkin and Roger Jowell, “Considered Opinions: Deliberative Polling in Britain” (2002) 32 British Journal of Political Science 455 at 461-2.


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U.S.A.) have been extensively analyzed. These analyses can shed light on the ability of the DBC to meet the three conditions outlined above. 4.2.5.1. The DBC Must Be Representative of the Population

The 301 participants in the 1994 deliberative poll in England were found to be completely representative of the English voting age population.44 The 459 participants in the NIC deliberative poll in the U.S.A., however, were not perfectly representative. Those 70 years or older, those with less than a high-school education, and those less interested in politics were underrepresented by 6, 8 and 6 percent respectively. Those with a college education and those with a high interest in politics were overrepresented by 7 and 8 percent respectively. This led Daniel Merkle to raise the concern that at the NIC deliberative poll, certain points of view were underrepresented.45

This is an important concern for the DBC in the proposed Canadian PB model. It is essential that DBC members carry as wide a range of views as possible about what they feel is vital for the health of their city – diversity will enrich deliberations and help prevent the ‘hijacking’ of the DBC by a specific group or ideology. Merkle speculates that the size of the U.S.A. (participants from across the country had to fly to Austin, Texas for the deliberations) may have contributed to the bias in the NIC sample.46 Therefore, assuming that a credible and professional polling company is employed to generate a random sample of a city electorate for the DBC, local DBC proceedings may not suffer the same problems as the NIC deliberative poll, given the smaller size of cities and hence shorter distances participants must travel. 4.2.5.2. There Must Be an Incentive to Participate in the DBC

Citizens selected to serve on the DBC need incentives to both show up for the proceedings as well as participate in the deliberations. The NIC deliberative poll has taught that offering participants a small honorarium (those selected were offered $325 for showing up) and paying for travel and accommodation costs (flight to Austin and hotel costs) greatly increases the probability that selected citizens will agree to participate.47 DBC participants should therefore be offered a small honorarium and have their travel costs (or other costs like daycare) covered. Another consideration is time. DBC proceedings must not create a barrier to participation by requiring a large time commitment – people should not have to miss work or spend a long period away from their friends and families (as can happen with jury duty). The suggested time of a single weekend for the DBC proceedings meets this requirement – participants do not need to miss work and are able to return home in the evenings to be with their families. Some may argue that a single weekend is not a long enough time to allow the DBC to deliberate and come to considered decisions, however the time allotted is no shorter than what City Councils currently dedicate to deliberation on budget issues involving much more money than is considered here.48 There must also be an incentive to actively participate in the DBC proceedings. The problem of “rational ignorance”, introduced in Chapter 1, is overcome since “(i)nstead of one 44 Ibid. at 466. 45 Daniel M. Merkle, “The Polls – Review: The National Issues Convention Deliberative Poll” (1996) 60 Public Opinion Quarterly 588 at 599-600. 46 Ibid. at 602. 47 Ibid. at 595. 48 As an example, Kingston City Council deliberated for one day each on the budgets for the Departments of Community Services ($108 million) and Operations ($39 million). City of Kingston, Report No. CW016, Report To Committee Of The Whole (22 February 2002) p 7.


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vote in millions, a participant in the deliberative poll [or DBC] has one vote in several hundred [or much less for the DBC].”49 Since the vote of each DBC participant does influence the outcome, there is an incentive to actively take part in the deliberations. A second problem is related to small group dynamics. Observers of the small groups taking part in the NIC deliberative poll found that some group discussions were dominated by vocal members.50 Not only does this harm the quality of debate (and infringe the democratic condition of political equality51), but it can also contribute to small group conformism; research on small groups has demonstrated that individual opinions can be shaped by “normative factors unrelated to the strength of the arguments.”52 This appears to have occurred in the 1994 deliberative poll in England. Fishkin found that “there was some modest tendency for people to change [their opinions] in the direction of their small groups (perhaps as a function of simple conformism, but perhaps also as a function of legitimate persuasion).”53 To help avoid these pitfalls in the DBC proceedings, group moderators should be utilized.54 Finally, conformist tendencies caused by group social pressures to prioritize projects in a certain way (outside legitimate persuasion) could be minimized by having DBC members rank projects privately and anonymously. 4.2.5.3. DBC Deliberations Must Influence Participants’ Decisions

Researchers have made conflicting claims about the effects of deliberation on individual opinions. Some researchers have reported that providing information to citizens, and increasing deliberation, has an influence on policy preferences and votes.55 Others say that opinion switching can occur without large exposure to treatments like deliberation.56 The results from the various deliberative polls suggests that individual attitudes and opinions are changed by the deliberative process.57 The most detailed analysis has been done on the 1994 deliberative poll in England. There, researchers found a statistically significant change in opinion, unrelated to socio-economic status (like education or income), on two-thirds of the policy items discussed. Participants were also shown to have learned more about the issues under discussion, with those who learned more demonstrating the largest shift in opinion.58 These results therefore support the holding of DBC proceedings as a useful deliberative mechanism, allowing citizens to learn about local issues and come to considered judgments on the utility of proposed city projects.

49 James S. Fishkin, “The Televised Deliberative Poll: An Experiment in Democracy” (1996) 546 Annals AAPSS 132 at 134 ¶ 5 50 Supra note 45 at 607. 51 Ibid. at 608. 52 Ibid. at 607 ¶ 3. 53 Supra note 43 at 485 ¶ 2. 54 James S. Fishkin, Robert C. Luskin and Roger Jowell, “Deliberative Polling and Public Consultation” (2000) 53 Parliamentary Affairs 657 at 660. 55 Larry Bartels, “Uninformed Votes: Information Effects in Presidential Elections” (1996) 40 American Journal of Political Science 194; Michael Delli Carpini and Scott Keeter, What Americans Know about Politics and Why It Matters (New Haven: Yale University Press, 1996). 56 Benjamin Page and Robert Shapiro, The Rational Public: Fifty Years of Trends in American’s Policy Preferences (Chicago: University of Chicago Press, 1992) at 6-7; Philip Converse, “The Nature of Belief Systems in Mass Publics” in David Apter, ed., Ideology and Discontent (New York: Free Press, 1964). 57 Supra note 43 at 485; note 45 at 612; note 54 at 663-4. 58 Supra note 43 at 466-85.


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4.2.6. Phase 6: Implementation and Oversight (Next Fiscal Year) As projects are implemented over the next fiscal year, the Community Committees will be responsible for monitoring the implementation process. If problems are observed, Community Committee members should have direct access to city councillors who must then take the necessary steps to remedy the situation. 4.3. Conclusion This paper has attempted to demonstrate that the quality of representation in Canadian governing structures is currently inadequate. Low voter-turnout and the failure of pluralism have created an imbalance in Fishkin’s four dynamic conditions of democracy – political equality, participation, deliberation and non-tyranny. Participatory budgeting (or PB), a Latin American innovation, has been proposed as one potential mechanism for improving democracy by increasing citizen participation (and subsequently deliberation) in issues of local importance. This paper outlined and critiqued the PB model currently in use in the city of Porto Alegre, Brazil, and the hypothetical PB model designed for the city of Salford, England. A theoretical PB model designed to suit the needs of Canadian cities was presented, which drew on the strengths of the Porto Alegre and Salford models while attempting to avoid their weaknesses. This model is not meant to be definitive and is therefore designed to be adapted to meet the individual needs of each city which strives to implement PB. While I feel that the proposed model is a useful and practical contribution to the development of PB outside South America, particularly in Canada, numerous challenges still remain. V/NGO capacity, at least in Canada, remains weak and must be advanced; similarly the PB process would benefit from a strategy to develop the budget-analysis capacity of citizens and V/NGOs that participate. Finally, organized political parties with the political will to implement and sustain PB must be identified and rigorously supported.

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