The World Bank

The Power of Institutional Legacies

Decentralization in Francophone Africa

Presented by:Presented by:Zoé Druilhe, Helene GrandvoinnetKai Kaiser, Stefanie TeggemannAfrica Public Sector Group (AFTPR)Public Sector Group (PRMPS)Poverty Reduction and Economic Management (PREM)

Presentation for:Presentation for: PREM Learning WeekMonday, May 1, 200612:30-2:00 pm

**** May 1st, 2006****

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Structure of Presentation

• A. Institutional Legacies and Development Outcomes• B. State Architectures and Decentralization

• Distinguishing Deconcentration/Devolution

• Political, Fiscal, Administrative Dimensions

• Implications for Accountability

• C. Decentralization in Francophone Africa• D. Common institutional legacies?

• Territorial Administration/Tutelle

• Deconcentrated/Top-down administration

• E. What does this imply for how we approach decentralization reforms to achieve development objectives?

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A. The Power of Institutions

• Institutions shape outcomes and paths– North– Colonial Origins of Comparative Economic Development

• Acemoglu, Johnson, Robinson (2001)

– Legal Traditions, Finance, and Growth• Roman (rule-based) versus Common Law (“organic”) traditions

• LaPorta et. al. (1997, 1998)

• Institutional legacies matter for decentralization reforms– Explore nature of institutional legacies, forms, pathways– Understand how these might inform operational work

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Approach of Stocktaking

•Eighteen Francophone Countries

•Four in-depth case studies

•Burkina Faso

•Guinea

•Madagascar

•Rwanda

•BNPP Supported

•Collaboration with Local/Regional Researchers

Sudan

AlgeriaLibya

MaliNiger

Chad

Egypt

Angola

EthiopiaNigeria

South Africa

Namibia

Mauritania

Zambia

Kenya

Democratic Republic Congo

Somalia

Mozambique

Botswana

Morocco

Congo

Madagascar

Cameroon

Zimbabwe

Gabon

Ghana

Guinea

Tanzania, United Republic of

Uganda

Ivory Coast

Tunisia

Central African Republic

Senegal

Burkina Faso

Benin

Western Sahara

Malawi

LiberiaTogo

Chad, Claimed by Libya

Rwanda

Djibouti

Swaziland

Egypt, Administered by Sudan

Spain

1000 0 1000 2000 Miles

N

EW

S

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Why Decentralization?

• If designed well, decentralization can– Move decision making closer to people (subsidiarity principle)– Enhance efficiency and responsiveness of service delivery– Enhance State Legitimacy/Accountability– Foster innovation/competition– Potentially help alleviate poverty

• But…– May risk diluting accountability

• Local Capture / corruption

• Unclear assignment of responsibilities

– Lack of Capacity• Human and fiscal resources

– Increased Disparities

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Deconcentration versus Devolution

Political Fiscal Administrative

DeconcentrationResponsibilities over certain services/functions transferred to branch offices with greater autonomy

Heads are appointed No fiscal autonomy

No Control over Civil Service (either local or own staff)

DevolutionTransfer of authority for decision making, finance and management to quasi-autonomous units of local government (typically across sectors)

Legislative and Executive are elected

Local Taxation

Autonomy/Local Budget Preferences

Control over Civil Service (Hiring, Firing)

Large variety of state structures and thus accountability models

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The Accountability Triangle

POLICY-MAKERS

PROVIDERS &FRONTLINE

ORGANIZATIONS

CITIZENS & USERS

CLIENT POWER

POLICY-MAKERSLocal Level

DECONCENTRATION

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C. Decentralization in Francophone Africa

Devolution remains limited in Africa (e.g., fiscal)

Francophone and Lusophone Africa rank particularly low (World Bank, 2002)

History of decentralization in Francophone Africa• Less autonomy under colonization (Direct Rule)

• After independence: • Continuation of French public administration system

• Strong/Authoritarian States • Wave of decentralization in early 1990s (political liberalization)

And today?• Gradualism • Deconcentration and Decentralization strategies in parallel• Political resistance and lack of political will• Inherited distrust towards decentralization?

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Political Devolution at the Commune level is incomplete

Assembly/Council Elected

Executive elected

100% 40-60% -30%

Benin, Burkina, Cameroon, Gabon, Madagascar, Mali, Mauritanie, Niger, Rwanda, Senegal

X X X

Guinea X No X

Cote Ivoire X X X

Congo No No X

Burundi, Chad, DRC, RCA, Togo

No No X

Elections, communes Population communalized

• Communes as building blocks of local government• Full communalization in 11/18 countries• Elections of assembly/council and executive in 11/18

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State Structure is under construction

Creation of intermediate devolved levels • But communalization is incomplete• Intermediate levels are not devolved• Intermediate levels are rarely operational

Creation of intermediate deconcentrated levels• Administrative parallelism• Lack of rationalization

The Example of Burkina Faso

For years, the state architecture was not clear, while the country was only half communalized.

• 1998. Province is deconcentrated and devolved• 2001. Region is deconcentrated and devolved

In 2004, the New Code des Collectivites states that BF has 2 devolved levels (Regions, Communes) and 3 administrative levels (Regions, Provinces, departments)

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Fiscal Devolution is Limited

• Low rates of fiscal devolution (<5% national fiscal rev.)• Transfers are low (or inexistent) and not timely• Transfers rarely transparent, predictable, formula- based • Investment transfers are scarce

% of budget (2001)

% of current revenue (2001)

Transfers determined by

the law?

Discretionary (D) or

Automatic (A)

Amount is according to or

ad hoc

conditional (C ) or unconditional

(Unc)

Benin 3% 2% no D Ad hoc Unc

Burkina  NA 7% yes D Formula Unc

Cote d'Ivoire 14% 15% yes D Formula both

Mali 14% 9% yes D Ad hoc Unc

Niger 4% 2%  Yes  A  Formula  Both

Senegal 9% 11% Yes A Formula Unc

Togo 0% 0% Yes D Ad Hoc Unc

Transfers to local governments, 2001

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D. Common institutional legacies?

•French Legacy of Centralized State•A uniform, unitary and centralized State•Apparent distrust of decentralization

•Prevalence of Tutelle and Territorial Administration•Strong emphasis on rules based controls•Territorial administration (with Préfet playing prominent role) and

sectoral deconcentration with different geographical areas•Mixed models of decentralization•Bias for deconcentration over devolution?

•Financial Management practices•Human Resource Management practices

•Ensuing state structure increases complexity of decentralization

=> top-down administration impacts incentives and capacity

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LG autonomy limited by the Tutelle

Country Tutelle authority

Benin, Burkina, Chad, Congo, Côte d'Ivoire, Guinea, Mauritania

Ex Ante administrative control

Cameroon, Gabon, Niger, Togo

Ex post control (theory)

Senegal Limited ex ante control

Madagascar Ex-Post Control

Central African Republic Direct administration

In a majority of countries, the Tutelle system operates ex-ante over LG’s financial decisions

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Financial Resource Management

Characteristics (vs. Anglophone):• Strong involvement of MoF at every step (ordonnateur)• Separation Ordonnateur/Comptable (multiple visas)• System emphasizes ex-ante controls

Challenges for decentralization:

- Centralization of resources and management– Limited transparency as to spatial incidence of public resources– Weak capacity for budget preparation/execution at local level– Weak ownership, autonomy and accountability at local level

- Bottlenecks and opportunities for corruption

Decentralization: risks appear higher (amounts/capacity)

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Human Resource Management

Characteristics:• One single scheme of service for all civil servants• Accountability to the center• Post not linked to geographical areas• HRM wholly centralized

– recruitment, evaluation, sanction, salaries, career management…

Challenges for decentralization:• Capacity often low at local level

– Concentration of staff in urban/central areas– Difficulties in attracting/retaining quality staff, notably in remote regions

• Low downward accountability of staff • Disincentives for staff to join the LG

– Limited trust towards new structures– Living conditions outside capital/urban centers

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Resulting Complex State Structure

Deconcentration and Devolution• Regional experience is varied but tendency to have parallel structures• Dual architectures (territorial, sectoral deconcentration). Sometimes,

without coherence between levels

Challenges for decentralization:

- Proliferation of levels of administration• Confusion or uncertainty on respective roles• High costs of decentralizing if no parallel effort at rationalizing

- Perverse incentives• Deconcentration perceived as a leverage towards more

decentralization, yet lack of incentives and capacity

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E. Operational Challenges for Decentralization Reforms

Political interests drive (and shape) decentralization reforms

• Strengthening democracy or appeasing opposition?

• Greater equity or preventing fragmentation of the state?

• Who drives? Champions? Winners and losers (including in bureaucracy)

However, World Bank/donors advice mostly centered on technical aspects

• Useful to understand objectives for devolution and deconcentration

• Identify and work with champions in government but also ensure consultation, information and participation of local communities in formulation and execution of decentralization policy

• Knowledge gaps on both formal/informal practices and local dynamics

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Operational Challenges for Decentralization Reforms (cont’d)

• Deconcentration versus devolution: Accountability and Capacity Matter– No model inherently superior, but need to reinforce accountability and be

equipped with sufficient capacity• Devolution offers greater downward accountability; however, if structures are

new, not rooted in local context and have little capacity not necessarily effective• Need to strike effective balance between upward and downward accountability

– Number of deconcentrated / devolved levels needs to be commensurate with capacity

• Too many layers of government is inefficient• Creation of many rural communes has significant cost implications

– Need to clarify roles and responsibilities (conventions/contracts), otherwise accountabilities blurred

• Sequencing of reforms needs to account for institutional legacies – Leverage both (deconcentrated and devolved levels) to build accountability

and capacity– Deconcentrated structures can help build capacity. However, they may be

adverse to greater devolution -> Avoid future lock in– Plan ahead for local capacity building and pace reform accordingly

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Q & A

Further Reading

Decentralizing Francophone African administrations for better service delivery: specificities, status and challenges , Zoé Druilhe, Hélène Grandvoinnet, Kai Kaiser, Stefanie Teggemann, draft